Dec 19 Accenture Plc said it expected
its consulting business to turn the corner this financial year
as orders rise, building on strength in its outsourcing unit
that helped the company report better-than-expected quarterly
Accenture shares rose as much as 5 percent on Thursday.
"We think consulting could be flat to low single-digit
positive (in the second quarter) ... we see the potential for
building momentum in consulting as we go through the year,"
Chief Financial Officer David Rowland said on a conference call.
Consulting bookings rose to $4.3 billion in the first
quarter from $4.2 billion a year earlier.
Accenture's consulting business has been hit in the past few
quarters as companies cut down on discretionary spending.
Revenue from the business has declined in five of the last six
The company did report a rise in revenue from the business
in the fourth quarter but said it was too early to say if that
Revenue from the consulting business fell 1 percent to $3.94
billion in the quarter ended Nov. 30.
Rival IBM said in October that revenue from its
services business, which consists of consulting and application
management, was flat in the third quarter.
Accenture's outsourcing business has benefited, particularly
in Europe, as companies cut costs amid patchy economic recovery.
Revenue from the business increased 5 percent to $3.42
billion in the first quarter.
Outsourcing accounted for 51 percent of total bookings in
the quarter, up from 44 percent a year earlier.
"They've set the stage well for their fiscal 2014. Now they
need to execute," Edward Jones analyst Josh Olson said.
Accenture forecast current-quarter revenue below estimates.
The company said it expected second-quarter revenue of $6.95
billion to $7.25 billion, below the average analyst estimate of
$7.28 billion, according to Thomson Reuters I/B/E/S.
However, the company raised its earnings forecast range for
the year ending Aug. 31 by 2 cents to $4.44-$4.56 per share,
saying it expects less impact from foreign exchange rates than
Accenture said it expected at least 60,000 new employees in
the fiscal year. The company had about 275,000 employees as of
Net income rose to $811.6 million, or $1.15 per share, in
the first quarter from $766 million, or $1.06 per share, a year
Revenue rose 2 percent to $7.36 billion.
Analysts on average had expected earnings of $1.09 per share
on revenue of $7.25 billion.
Accenture shares were up 4.4 percent at $78.95 in afternoon
trading on the New York Stock Exchange.