* Q3 sales 2.38 bln eur vs Rtrs poll avg 2.33 bln
* Confirms sales to grow 9-10 pct in 2011
* Says takes out additional 500 mln eur credit line
(Adds shares, CEO/CFO comments, analyst comment, detail)
By Gwénaëlle Barzic
PARIS, Nov 8 Capgemini stuck to its
target to grow sales as much as 10 percent and boost its margin
this year despite economic uncertainty, sending shares in the
French information technology services provider up more than 6
percent on Tuesday.
The company posted a 13 percent rise in third-quarter
revenue to 2.38 billion euros ($3.3 billion), driven by
acquisitions including CPM Braxis in Brazil and Prosodie in
France and ahead of the average estimate in a Reuters analyst
poll of 2.33 billion.
Shares in Capgemini, which have tumbled 35 percent in the
last four months, were 5.2 percent higher at 27.86 euros at 1029
GMT, the second-strongest performers on a 1.7 percent firmer
French blue-chip CAC 40 index .
Chief Executive Paul Hermelin told a conference call that
Capgemini's clients had so far not been slashing budgets,
although it was difficult to predict how the coming months would
"Today, we are still in a market that is holding up,"
Capgemini said it was continuing to target full-year revenue
growth of 9-10 percent, or at least 5 percent on a like-for-like
basis, as well as an improvement in its operating margin of more
than 0.5 percentage points.
Sales growth stripping out the effect of asset sales and
acquisitions was 4.7 percent in the third quarter, slowing from
8.8 percent in the second quarter.
"As anticipated, organic growth is gradually reducing
quarter by quarter because of higher and higher comparatives,"
CM-CIC Securities analyst Dov Levy said in a note.
Levy said that while Capgemini's sales publication contained
no surprises, the company had had a "good performance" in France
and in its technology services business.
France generated improved revenue growth of 7.8 percent,
while its technology services business had 7.2 percent growth,
Capgemini, which competes with IBM and Atos Origin
among others, added that it had taken steps to
strengthen its balance sheet, taking out an additional 500
million euros credit line.
This would be refinanced when market conditions were deemed
satisfactory, preferably through a bond issue, finance head
Nicolas Dufourcq told the conference call.
Capgemini also added that given "the unfavorable trend in
stock market prices in recent months" the redemption of its
convertible bonds due in January was now probable.
(Editing by Christian Plumb and Mike Nesbit)