Accenture Achieves Record Annual Revenues and EPS.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Accenture (Accenture, Chicago, IL, www.accenture.com) The world's largest management and technology consulting firm, which was spun off of Arthur Andersen & Co. in 1989 as a separate entity known as Andersen Consulting. (NYSE NYSE See: New York Stock Exchange : ACN ACN Accenture (stock symbol) ACN Accenture ACN Australian Company Number ACN Automatic Collision Notification (US DOT) ACN Acetonitrile ACN Anglican Communion Network ) --Revenues Increase 15% and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. Up 27% in Fourth Quarter; Annual Revenues Increase 14% and Annual EPS Up 28% --Company Declares Cash Dividend Accenture (NYSE: ACN) today reported financial results for the fourth-quarter and full fiscal year ended Aug. 31, 2005, with record annual revenues, operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. and earnings per share. In addition, the company announced that its Board of Directors has declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. an annual cash dividend. William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack D. Green, Accenture's CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "We're we're Contraction of we are. we're we are truly pleased by our outstanding performance in the fourth quarter and full year. Our record revenues in fiscal 2005 included our highest annual revenue growth in consulting since we became a public company in 2001. We grew revenues well ahead of the industry average, hit our operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: target of 13 percent, achieved double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. EPS growth, and maintained our strong cash flow and balance sheet. We also accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. variable compensation for our employees. "We are especially encouraged by our strong fourth-quarter performance. We achieved record growth in the Americas A·mer·i·cas , the See America. , driven by a significant increase in both consulting and outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. revenues in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , and had $5.2 billion in total new bookings, our highest in six quarters. "We're also pleased to be able to return cash to shareholders through a cash dividend in addition to ongoing share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. ." Financial Highlights Fourth Quarter 2005 --Revenues before reimbursements ("net revenues") were $3.92 billion, compared with $3.42 billion for the fourth quarter of fiscal 2004, an increase of 15 percent in U.S. dollars and 14 percent in local currency and ahead of the company's expected range of $3.80 billion to $3.90 billion. --Diluted EPS were $0.38, compared with $0.30 for the fourth quarter of fiscal 2004, an increase of 27 percent and ahead of the company's expected range of $0.34 to $0.37. --Operating income increased 37 percent to $509 million, or 13.0 percent of net revenues. --New bookings totaled $5.16 billion, representing the highest quarterly bookings in six quarters. Consulting accounted for $2.42 billion, or 47 percent, of quarterly new bookings, and outsourcing accounted for $2.74 billion, or 53 percent, of quarterly new bookings. --All five operating groups achieved double-digit revenue growth in U.S. dollars and strong growth in local currency. Growth was particularly strong in Products, with revenues increasing 23 percent in U.S. dollars and 22 percent in local currency. --The company also grew revenues in all three geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. regions in both U.S. dollars and local currency. Growth was particularly strong in the Americas, with revenues increasing 22 percent in U.S. dollars and 20 percent in local currency. Fiscal Year 2005 --Revenues before reimbursements ("net revenues") were $15.55 billion, compared with $13.67 billion for fiscal year 2004, an increase of 14 percent in U.S. dollars and 10 percent in local currency and ahead of the company's expected growth of 13 percent in U.S. dollars and 9 percent in local currency. --Diluted EPS were $1.56, compared with $1.22 for fiscal 2004, an increase of 28 percent and ahead of the company's expected range of $1.52 to $1.55. --Operating income increased 20 percent to $2.11 billion, or 13.6 percent of net revenues, compared with $1.76 billion, or 12.9 percent of net revenues, for fiscal 2004. This is the first time that Accenture's annual operating income exceeded $2.0 billion. --New bookings totaled $18.03 billion, within the company's expected range of $18 billion to $20 billion for the full fiscal year. Consulting accounted for $9.73 billion, or 54 percent, of new bookings, and outsourcing bookings accounted for $8.30 billion, or 46 percent, of new bookings. --All five operating groups achieved revenue growth in both U.S. dollars and local currency. Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. and Products were particularly strong, with Financial Services revenues increasing 23 percent in U.S. dollars and 18 percent in local currency and Products revenues increasing 20 percent in U.S. dollars and 16 percent in local currency. --The company also grew revenues in all three geographic regions in both U.S. dollars and local currency. Growth was particularly strong in the company's EMEA (Europe, Middle East, Africa) Refers to that region of the world. For example, one might see products packaged differently for the UK, EMEA and Asia Pacific markets. (Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). / Middle East / Africa) region, with
revenues increasing 19 percent in U.S. dollars and 12 percent in local
currency.Financial Review Fourth Quarter 2005 Gross margin (gross profit as a percentage of net revenues) was 33.0 percent, compared with 32.4 percent for the fourth quarter of fiscal 2004. Selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. were $778 million, or 19.8 percent of net revenues, compared with $732 million, or 21.4 percent of net revenues, for the fourth quarter in fiscal 2004. Operating income was $509 million, or 13.0 percent of net revenues, compared with $371 million, or 10.8 percent of net revenues, for the fourth quarter in fiscal 2004. Excluding reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. costs, operating income for the fourth quarter of fiscal 2005 was $515 million, or 13.1 percent of net revenues. Accenture accrued $36 million of variable compensation expense in the fourth quarter of fiscal 2005. The company's effective tax rate for the fourth quarter was 33.1 percent. Income before minority interest for the fourth quarter of fiscal 2005 was $363 million, compared with $300 million for the same period in fiscal 2004. For the three months ended Aug. 31, 2005, operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. was $567 million, and property and equipment additions were $131 million. Free cash flow, defined as operating cash flow net of property and equipment additions, was $436 million. Fiscal Year 2005 Gross margin (gross profit as a percentage of net revenues) was 32.8 percent, compared with 33.8 percent for fiscal 2004. Selling, general and administrative costs were $3.07 billion, or 19.7 percent of net revenues, compared with $2.83 billion, or 20.7 percent of net revenues, for fiscal 2004. Accenture recorded net reorganization benefits of $89 million in fiscal 2005, which included a $115 million, or $0.12 per share, reduction in reorganization liabilities offset by a $26 million, or $0.03 per share, interest expense associated with carrying these liabilities. Operating income in fiscal 2005 was $2.11 billion, or 13.6 percent of net revenues, compared with $1.76 billion, or 12.9 percent of net revenues, in fiscal 2004. Excluding the net reorganization and restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). benefit of $89 million, operating income was $2.02 billion, or 13.0 percent of net revenues, for the full fiscal year. This compares with $1.79 billion, or 13.1 percent of net revenues, for fiscal 2004. The company accrued variable compensation expense of $100 million in fiscal 2005, which was in line with its target. Accenture's annual effective tax rate for the full fiscal year was 31.6 percent, within the company's expected range of 31 percent to 33 percent. Accenture's annual effective tax rate for the full fiscal year 2004 was 32.0 percent. Income before minority interest was $1.51 billion, compared with $1.22 billion in fiscal 2004. For the full year ended Aug. 31, 2005, operating cash flow was $1.89 billion, and property and equipment additions were $318 million. Free cash flow, defined as operating cash flow net of property and equipment additions, was $1.57 billion, within the company's target range. For the year ended Aug. 31, 2004, operating cash flow was $1.76 billion, property and equipment additions were $282 million and free cash flow was $1.47 billion. Accenture's total cash balance at Aug. 31, 2005 was $2.48 billion, compared with $2.55 billion at Aug. 31, 2004 and $2.77 billion at May 31, 2005. Cash combined with $701 million of fixed-income securities Fixed-income securities Investments that have specific interest rates, such as bonds. classified as investments on the company's balance sheet was $3.18 billion at Aug. 31, 2005, compared with $3.15 billion at Aug. 31, 2004 and $3.48 billion at May 31, 2005. Total debt at Aug. 31, 2005 was $75 million. Consulting and Outsourcing Net Revenues Fourth Quarter 2005 --Consulting net revenues were $2.38 billion, or 61 percent of net revenues, an increase of 11 percent in U.S. dollars and 10 percent in local currency over the fourth quarter of fiscal 2004. --Outsourcing accounted for $1.55 billion, or 39 percent of net revenues, an increase of 21 percent in U.S. dollars and 20 percent in local currency over the same period in fiscal 2004. Fiscal Year 2005 --Consulting net revenues were $9.56 billion, or 61 percent of net revenues, an increase of 11 percent in U.S. dollars and 7 percent in local currency over fiscal 2004. --Outsourcing accounted for $5.99 billion, or 39 percent of net revenues, an increase of 18 percent in U.S. dollars and 14 percent in local currency over fiscal 2004. Dividend Accenture Ltd today declared a cash dividend of $0.30 per share on Accenture Class A common shares for shareholders of record at the close of business on Monday Monday: see week. , Oct. 17, 2005, and Accenture SCA (Single Connector Attachment) An 80-pin plug and socket used to connect peripherals. With a SCSI drive, it rolls three cables (power, data channel and ID configuration) into one connector for fast installation and removal. will declare TO DECLARE. To make known or publish. By tho constitution of the United States, congress have power to declare war. In this sense the word, declare, signifies, not merely to make it known that war exists, but also to make war and to carry it on. 4 Dall. 37; 1 Story, Const. Sec. a cash dividend of $0.30 per share on Class I common shares for shareholders of record at the close of business on Wednesday Wednesday: see week. , Oct. 12, 2005. Both dividends are to be payable on Nov. 15, 2005. Share Repurchase Activity During the fourth quarter of fiscal 2005, Accenture repurchased $542 million of its shares. This comprised $55 million for purchases of 2.2 million Accenture Ltd Class A common shares and $487 million for 21.4 million Accenture SCA Class I common shares and Accenture Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of Holdings Inc. exchangeable shares repurchased or redeemed re·deem tr.v. re·deemed, re·deem·ing, re·deems 1. To recover ownership of by paying a specified sum. 2. To pay off (a promissory note, for example). 3. from partners, retired partners and their permitted transferees. During the full fiscal year 2005, Accenture repurchased or redeemed 65.8 million shares, for a total of $1.6 billion. At Aug. 31, 2005, Accenture had $1.7 billion of share repurchase authority remaining, of which $581 million remained for use in connection with the company's open-market share purchase program. In September September: see month. , Accenture's Board of Directors approved the use of an additional $800 million in connection with Accenture SCA's offer to purchase or redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. up to 37,209,302 of its Class I common shares at a price not greater than $21.50 per share. The offer is expected to expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. at midnight EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT on Thursday Thursday: see week. , Oct. 13, 2005. Business Outlook First Quarter Fiscal 2006 For the first quarter of fiscal 2006, ending Nov. 30, 2005, Accenture expects net revenues to be in the range of $4.0 billion to $4.2 billion and GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of to be in the range of $0.32 to $0.34. The GAAP diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. EPS range includes the impact of adopting SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 123R. Fiscal Year 2006 For the full fiscal year 2006, Accenture expects net revenue growth to be in the range of 9 percent to 12 percent in local currency. In fiscal year 2006, Accenture will begin expensing stock options and employee stock purchase programs in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with SFAS No. 123R. The company estimates that if it had expensed stock options in fiscal 2005, the annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. impact would have been $0.16 per share. Earnings per share for fiscal 2005 also included a benefit of $0.12 per share from a reduction in reorganization liabilities. Adjusting for these two items, fiscal 2005 earnings per share of $1.56 would have been $1.28. The company expects GAAP diluted earnings per share for fiscal 2006 to be in the range of $1.45 to $1.50, representing 13 percent to 17 percent growth over the comparable 2005 baseline The horizontal line to which the bottoms of lowercase characters (without descenders) are aligned. See typeface. baseline - released version of $1.28. Also for the full fiscal year, the company expects operating cash flow to be $2.00 billion to $2.20 billion; property and equipment additions to be $450 million; and free cash flow to be in the range of $1.55 billion to $1.75 billion. The annual effective tax rate is expected to be in the range of 35 percent to 38 percent. Accenture is targeting new bookings in the range of $19 billion to $21 billion for the full fiscal year. Conference Call and Webcast Details Accenture will host a conference call at 4:30 p.m. EDT today to discuss its fourth-quarter and full-year 2005 financial results. To participate, please dial +1 (866) 233-3843 (+1 (612) 332-0335 outside the United States, Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. and Canada) approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 15 minutes before the scheduled start of the call. The conference call will also be accessible live on the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Accenture Web site at www.accenture.com. A replay of the conference call will be available online at www.accenture.com and via telephone by dialing +1 (800) 475-6701 (+1 (320) 365-3844 outside the United States, Puerto Rico and Canada) and entering access code 796108 from 9:45 p.m. EDT Thursday, Oct. 6 through 11:59 p.m. EDT Thursday, Oct. 20. About Accenture Accenture is a global management consulting Noun 1. management consulting - a service industry that provides advice to those in charge of running a business service industry - an industry that provides services rather than tangible objects , technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize mo·bi·lize v. 1. To make mobile or capable of movement. 2. To restore the power of motion to a joint. 3. To release into the body, as glycogen from the liver. the right people, skills, and technologies to help clients improve their performance. With more than 123,000 people in 48 countries, the company generated net revenues of US$15.55 billion for the fiscal year ended Aug. 31, 2005. Its home page is www.accenture.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This news release contains forward-looking statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc our operations and results of operations, the accuracy of which is necessarily subject to risks and uncertainties. Factors that could cause actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. include general economic conditions and the factors discussed under the "Risk Factors" heading in the Business section of our most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission. Accenture undertakes no duty to update any forward-looking statements made in this news release or to conform such statements to actual results or changes in Accenture's expectations. Non-GAAP Financial Information This press release includes certain non-GAAP financial information as defined by Securities and Exchange Commission Regulation G. Pursuant to the requirements of this regulation, reconciliations of this non-GAAP financial information to Accenture's financial statements as prepared under generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP) are included in this press release. Accenture discloses free cash flow (defined as operating cash flow net of property and equipment additions) and operating income excluding reorganization benefits and costs and restructuring costs, and provides certain additional information regarding earnings per share for fiscal 2005. Accenture's management believes providing investors with this information gives additional insights into Accenture's results of operations. While Accenture's management believes that these non-GAAP financial measures are useful in evaluating Accenture's operations, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP.
ACCENTURE LTD
CONSOLIDATED INCOME STATEMENTS
For the Three Months Ended August 31, 2005 and 2004
(In thousands of U.S. dollars, except share and per share data)
(Unaudited)
2005 2004
--------------------- ---------------------
% of Net % of Net
Revenues Revenues
-------- --------
REVENUES:
Revenues before
reimbursements (Net
revenues) $ 3,924,579 100% $ 3,423,107 100%
Reimbursements 384,475 10% 383,442 11%
------------ ------------
Revenues 4,309,054 110% 3,806,549 111%
OPERATING EXPENSES:
Cost of services:
Cost of services
before reimbursable
expenses 2,631,385 67% 2,314,022 68%
Reimbursable expenses 384,475 10% 383,442 11%
------------ ------------
Cost of services 3,015,860 77% 2,697,464 79%
Sales and marketing 401,166 10% 387,841 11%
General and
administrative costs 377,229 10% 344,429 10%
Reorganization costs 5,611 0% 5,915 0%
------------ ------------
Total operating
expenses 3,799,866 97% 3,435,649 100%
------------ ------------
OPERATING INCOME 509,188 13% 370,900 11%
Gain (loss) on
investments, net 2,163 0% (770) 0%
Interest income 30,977 1% 17,893 1%
Interest expense (4,984) 0% (5,074) 0%
Other income (expense) 5,125 0% (426) 0%
Equity in losses of
affiliates -- 0% (236) 0%
------------ ------------
INCOME BEFORE INCOME TAXES 542,469 14% 382,287 11%
Provision for income taxes 179,738 5% 82,676 2%
------------ ------------
INCOME BEFORE MINORITY
INTEREST 362,731 9% 299,611 9%
Minority interest in
Accenture SCA and
Accenture Canada
Holdings Inc (127,439) (3%) (115,088) (3%)
Minority interest -
other (1) (6,157) 0% (1,533) 0%
------------ ------------
NET INCOME $ 229,135 6% $ 182,990 5%
============ ============
CALCULATION OF EARNINGS
PER SHARE:
Net income $ 229,135 $ 182,990
Minority interest in
Accenture SCA and
Accenture Canada
Holdings Inc. (2) 127,439 115,088
------------ ------------
Net income for diluted
earnings per share
calculation $ 356,574 $ 298,078
EARNINGS PER SHARE:
- Basic $ 0.39 $ 0.31
============ ============
- Diluted $ 0.38 $ 0.30
============ ============
WEIGHTED AVERAGE SHARES:
- Basic 584,088,816 589,080,622
- Diluted 930,688,067 986,250,253
(1) Minority interest - other is comprised primarily of minority
interest attributable to the minority shareholders of Avanade,
Inc.
(2) Diluted earnings per share assumes the redemption and exchange of
all Accenture SCA Class I common shares and Accenture Canada
Holdings Inc. exchangeable shares, respectively, for Accenture Ltd
Class A common shares, on a one-for-one basis.
ACCENTURE LTD
CONSOLIDATED INCOME STATEMENTS
For the Years Ended August 31, 2005 and 2004
(In thousands of U.S. dollars, except share and per share data)
2005 (Unaudited) 2004
--------------------- ---------------------
% of Net % of Net
Revenues Revenues
-------- --------
REVENUES:
Revenues before
reimbursements
(Net revenues) $15,547,029 100% $13,673,563 100%
Reimbursements 1,547,391 10% 1,440,019 11%
------------ ------------
Revenues 17,094,420 110% 15,113,582 111%
OPERATING EXPENSES:
Cost of services:
Cost of services
before
reimbursable
expenses 10,454,830 67% 9,057,246 66%
Reimbursable
expenses 1,547,391 10% 1,440,019 11%
------------ ------------
Cost of
services 12,002,221 77% 10,497,265 77%
Sales and
marketing 1,558,266 10% 1,488,333 11%
General and
administrative
costs 1,511,952 10% 1,340,467 10%
Reorganization
and
restructuring
(benefits) costs (89,257) (1%) 28,891 0%
------------ ------------
Total operating
expenses 14,983,182 96% 13,354,956 98%
------------ ------------
OPERATING INCOME 2,111,238 14% 1,758,626 13%
Gain on
investments, net 21,468 0% 3,397 0%
Interest income 108,236 1% 59,939 0%
Interest expense (23,973) 0% (22,044) 0%
Other (expense)
income (10,967) 0% 160 0%
Equity in losses of
affiliates -- 0% (1,508) 0%
------------ ------------
INCOME BEFORE
INCOME TAXES 2,206,002 14% 1,798,570 13%
Provision for
income taxes 697,097 4% 575,543 4%
------------ ------------
INCOME BEFORE
MINORITY INTEREST 1,508,905 10% 1,223,027 9%
Minority interest
in Accenture SCA
and Accenture
Canada
Holdings Inc (556,485) (4%) (529,672) (4%)
Minority interest -
other (1) (11,946) 0% (2,527) 0%
------------ ------------
NET INCOME $ 940,474 6% $ 690,828 5%
============ ============
CALCULATION OF
EARNINGS PER
SHARE:
Net income $ 940,474 $ 690,828
Minority interest
in Accenture SCA
and Accenture
Canada
Holdings Inc. (2) 556,485 529,672
------------ ------------
Net income for
diluted earnings
per share
calculation $ 1,496,959 $ 1,220,500
EARNINGS PER
SHARE:
- Basic $ 1.60 $ 1.25
============ ============
- Diluted $ 1.56 $ 1.22
============ ============
WEIGHTED AVERAGE
SHARES:
- Basic 588,505,335 553,298,104
- Diluted 960,514,976 1,002,813,443
(1) Minority interest - other is comprised primarily of minority
interest attributable to the minority shareholders of Avanade,
Inc.
(2) Diluted earnings per share assumes the redemption and exchange of
all Accenture SCA Class I common shares and Accenture Canada
Holdings Inc. exchangeable shares, respectively, for Accenture Ltd
Class A common shares, on a one-for-one basis.
ACCENTURE LTD
SUMMARY OF REVENUES
(In thousands of U.S. dollars)
(Unaudited)
Three Months Ended
--------------------- Percent Percent
Percent Increase of Total
Aug. 31, Aug. 31, Increase Local 2005 Net
2005 2004 US $ Currency Revenues
--------------------- -------- --------- --------
OPERATING GROUPS
Communications &
High Tech $1,009,356 $ 913,244 11% 9% 26%
Financial
Services 832,715 724,810 15% 14% 21%
Government 549,296 500,894 10% 9% 14%
Products 923,704 750,817 23% 22% 24%
Resources 607,397 531,054 14% 12% 15%
Other 2,111 2,288 n/m n/m --
---------- ---------- --------
TOTAL Net Revenues 3,924,579 3,423,107 15% 14% 100%
========
Reimbursements 384,475 383,442 0%
---------- ----------
TOTAL REVENUES $4,309,054 $3,806,549 13%
========== ==========
GEOGRAPHY
Americas $1,835,458 $1,503,012 22% 20% 47%
EMEA 1,805,226 1,661,709 9% 9% 46%
Asia Pacific 283,895 258,386 10% 6% 7%
---------- ---------- --------
TOTAL Net Revenues 3,924,579 3,423,107 15% 14% 100%
========
Reimbursements 384,475 383,442 0%
---------- ----------
TOTAL REVENUES $4,309,054 $3,806,549 13%
========== ==========
Year Ended Percent
----------------------- Percent of Total
Percent Increase 2005
Aug. 31, Aug. 31, Increase Local Net
2005 2004 US $ Currency Revenues
----------- ----------- -------- --------- --------
OPERATING GROUPS
Communications &
High Tech $ 4,001,347 $ 3,741,451 7% 4% 26%
Financial
Services 3,408,166 2,770,990 23% 18% 22%
Government 2,171,458 1,994,655 9% 6% 14%
Products 3,569,975 2,978,892 20% 16% 23%
Resources 2,388,845 2,178,569 10% 5% 15%
Other 7,238 9,006 n/m n/m --
----------- ----------- --------
TOTAL Net Revenues 15,547,029 13,673,563 14% 10% 100%
========
Reimbursements 1,547,391 1,440,019 7%
----------- -----------
TOTAL REVENUES $17,094,420 $15,113,582 13%
=========== ===========
GEOGRAPHY
Americas $ 6,642,082 $ 6,133,081 8% 7% 43%
EMEA 7,805,714 6,572,011 19% 12% 50%
Asia Pacific 1,099,233 968,471 14% 9% 7%
----------- ----------- --------
TOTAL Net
Revenues 15,547,029 13,673,563 14% 10% 100%
========
Reimbursements 1,547,391 1,440,019 7%
----------- -----------
TOTAL REVENUES $17,094,420 $15,113,582 13%
=========== ===========
n/m = not meaningful
ACCENTURE LTD
OPERATING INCOME BY OPERATING GROUP (OG)
For the Three Months Ended August 31, 2005 and 2004
(In thousands of U.S. dollars)
(Unaudited)
Operating Income as Reported
-------------------------------------
2005 2004
------------------ ------------------
Percent Percent Increase
of OG of OG (Decrease)
Operating Net Operating Net ----------------
Operating Groups Income Revenues Income Revenues US$ Percent
------------------ ------------------ ----------------
Communications
& High Tech $162,838 16% $123,937 14% $ 38,901 31%
Financial
Services 113,949 14% 81,995 11% 31,954 39%
Government 39,945 7% 63,511 13% (23,566) (37%)
Products 111,948 12% 42,684 6% 69,264 162%
Resources 80,508 13% 58,773 11% 21,735 37%
-------- -------- --------
Total Operating
Income $509,188 13% $370,900 11% $138,288 37%
======== ======== ========
Non-GAAP Operating Income
(Operating Income Excluding Reorganization) (1)
-------------------------------------
2005 2004
------------------ ------------------
Increase
Percent Percent (Decrease)
Non-GAAP of OG Non-GAAP of OG ----------------
Operating Operating Net Operating Net
Groups Income Revenues Income Revenues US$ Percent
------------------ ------------------ ----------------
Communications
& High Tech $164,212 16% $125,392 14% $ 38,820 31%
Financial
Services 115,144 14% 83,310 11% 31,834 38%
Government 40,780 7% 64,394 13% (23,614) (37%)
Products 113,313 12% 44,006 6% 69,307 157%
Resources 81,350 13% 59,713 11% 21,637 36%
-------- -------- --------
Total Non-GAAP
Operating
Income $514,799 13% $376,815 11% $137,984 37%
======== ======== ========
(1) For the three months ended August 31, 2005, Accenture recorded
reorganization costs of $5,611 related to certain reorganization
liabilities established in connection with Accenture's transition
to a corporate structure in 2001, allocated to the operating
groups in the following amounts: Communications & High Tech
$1,374; Financial Services $1,195; Government $835; Products
$1,365; and Resources $842. For the three months ended August 31,
2004, Accenture recorded reorganization costs of $5,915 related to
certain reorganization liabilities established in connection with
Accenture's transition to a corporate structure in 2001, allocated
to the operating groups in the following amounts: Communications &
High Tech $1,455; Financial Services $1,315; Government $883;
Products $1,322; and Resources $940. These amounts are excluded
from the table.
ACCENTURE LTD
OPERATING INCOME BY OPERATING GROUP (OG)
For the Years Ended August 31, 2005 and August 31, 2004
(In thousands of U.S. dollars)
(Unaudited)
Operating Income as Reported
-------------------------------------
2005 2004
------------------ ------------------
Increase
Percent Percent (Decrease)
of OG of OG ----------------
Operating Operating Net Operating Net
Groups Income Revenues Income Revenues US$ Percent
------------------ ---------- ------- ----------------
Communications
& High Tech $ 673,183 17% $ 403,698 11% $269,485 67%
Financial
Services 499,647 15% 353,904 13% 145,743 41%
Government 168,736 8% 311,050 16% (142,314) (46%)
Products 413,188 12% 414,501 14% (1,313) 0%
Resources 356,484 15% 275,473 13% 81,011 29%
---------- ---------- --------
Total Operating
Income $2,111,238 14% $1,758,626 13% $352,612 20%
========== ========== ========
Non-GAAP Operating Income
(Operating Income Excluding Reorganization and
Restructuring) (1)
-------------------------------------
2005 2004
------------------ ------------------
Increase
Percent Percent (Decrease)
Non-GAAP of OG Non-GAAP of OG ----------------
Operating Operating Net Operating Net
Groups Income Revenues Income Revenues US$ Percent
------------------ ------------------ ----------------
Communications
& High Tech $ 651,909 16% $ 410,928 11% $240,981 59%
Financial
Services 479,004 14% 360,307 13% 118,697 33%
Government 155,401 7% 315,297 16% (159,896) (51%)
Products 392,169 11% 420,857 14% (28,688) (7%)
Resources 343,498 14% 280,128 13% 63,370 23%
---------- ---------- --------
Total Non-GAAP
Operating
Income $2,021,981 13% $1,787,517 13% $234,464 13%
========== ========== ========
(1) For the year ended August 31, 2005, Accenture recorded net
reorganization benefits of $89,257 primarily resulting from final
determinations of certain reorganization liabilities established
in connection with Accenture's transition to a corporate structure
in 2001, allocated to the operating groups in the following
amounts: Communications & High Tech $21,274; Financial Services
$20,643; Government $13,335; Products $21,019; and Resources
$12,986. For the year ended August 31, 2004, Accenture recorded
restructuring costs of $107,256 related to the Company's global
consolidation of office space and net reorganization benefits of
$78,365 primarily resulting from final determinations of certain
reorganization liabilities established in connection with
Accenture's transition to a corporate structure in 2001. The net
cost of $28,891 was allocated to the operating groups in the
following amounts: Communications & High Tech $7,230; Financial
Services $6,403; Government $4,247; Products $6,356; and Resources
$4,655. These amounts are excluded from the table.
ACCENTURE LTD
RECONCILIATION OF DILUTED EARNINGS PER SHARE, AS REPORTED (GAAP) TO
DILUTED EARNINGS PER SHARE, AS ADJUSTED (NON-GAAP)
For the Year Ended August 31, 2005
(In thousands of U.S. Dollars, except per share data)
(Unaudited)
Per
Share
Dollar Amount
Amount (1)
----------- -------
Net income, as reported $ 940,474
Minority interest in Accenture SCA and Accenture
Canada Holdings Inc. (2) 556,485
-----------
Net income for diluted earnings per share
calculation, as reported 1,496,959 $1.56
Pro forma stock option and employee share purchase
plan compensation expense (3) (152,376) (0.16)
Reduction in reorganization liabilities (115,444) (0.12)
----------- -------
Net income for diluted earnings per share
calculation, adjusted $1,229,139 $1.28
=========== =======
(1) The per share amount is calculated as the dollar amount divided by
the number of weighted average diluted shares of 960,514,976 at
August 31, 2005.
(2) Diluted earnings per share assumes the redemption and exchange of
all Accenture SCA Class I common shares and Accenture Canada
Holdings Inc. exchangeable shares, respectively, for Accenture Ltd
Class A common shares, on a one-for-one basis.
(3) Calculated as $217,565 of pre-tax stock option and employee share
purchase plan compensation expense with an average effective tax
rate of 30%.
ACCENTURE LTD
CONSOLIDATED BALANCE SHEETS
August 31, 2005 and August 31, 2004
(In thousands of U.S. dollars)
2005 2004
----------- -----------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $2,483,990 $2,552,958
Short-term investments 463,460 285,288
Receivables from clients, net 1,752,937 1,662,211
Unbilled services 1,353,676 1,049,870
Other current assets 631,204 588,867
----------- -----------
Total current assets 6,685,267 6,139,194
----------- -----------
NON-CURRENT ASSETS:
Investments 262,873 340,121
Property and equipment, net 693,710 643,946
Other non-current assets 1,315,502 890,223
----------- -----------
Total non-current assets 2,272,085 1,874,290
----------- -----------
TOTAL ASSETS $8,957,352 $8,013,484
=========== ===========
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Short-term debt $ 31,072 $ 36,715
Accounts payable 807,317 523,931
Deferred revenues 1,284,303 980,461
Accrued payroll and related benefits 1,430,998 1,463,126
Other accrued liabilities 1,308,699 1,389,556
----------- -----------
Total current liabilities 4,862,389 4,393,789
----------- -----------
NON-CURRENT LIABILITIES:
Long-term debt 44,116 32,161
Other non-current liabilities 1,372,974 1,174,765
----------- -----------
Total non-current liabilities 1,417,090 1,206,926
----------- -----------
MINORITY INTEREST 980,959 940,963
----------- -----------
EQUITY:
Total Shareholders' equity 1,696,914 1,471,806
----------- -----------
TOTAL LIABILITIES AND EQUITY $8,957,352 $8,013,484
=========== ===========
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