Accenture Reports Second-Quarter Results.Business Editors NEW YORK--(BUSINESS WIRE)--April 11, 2002 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 ) today reported results for the second quarter, ended February February: see month. 28, 2002, that are consistent with the company's announcement in March in which it said it would exceed analysts' expectations for its operating results. Revenues before reimbursements ("net revenues") for the second quarter were $2.91 billion, an increase of 1 percent in US dollars and 3 percent in local currency over the second quarter of fiscal 2001. 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. was $388 million, or 13 percent of net revenues for the quarter. Net income before minority interest, excluding investment writedowns described below, increased 9 percent, to $236 million, compared to $216 million on a comparable pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis in the same quarter of the previous fiscal year. 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 on the same basis were $0.23, compared to $0.21 on a comparable pro forma basis in the same quarter of the previous fiscal year. Reported net income before minority interest, including investment writedowns, was $11 million for the second quarter, and diluted earnings per share on the same basis were $0.02. "Our resilience resilience (r  ·zilˑ·yens),n in what continues to be a difficult global economic environment enabled us to achieve modest revenue growth and improved operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: in the second quarter," said Joe W. Forehand forehand the head, neck, shoulders, withers and forelimbs of the horse. , Accenture chairman and 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. . "In addition, during the first half of fiscal 2002 we had an impressive $9.8 billion in new bookings, nearly half of which represents business transformation 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. engagements, demonstrating the strong demand for our unique ability to help clients improve their business performance and bring their ideas to life." In terms of the near-term near-term adj. Of, for, or involving a short period of time in the near future. outlook, Accenture said that while there are a number of positive indicators in its business, it, like most other companies, is seeing the overall economic recovery moving very slowly across different industries and 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. Accenture said, however, that it is comfortable with analysts' consensus earnings estimates of $0.26 per share for the third quarter ending May 31, 2002. As the company stated in March, it has decided to sell substantially all of its venture and investment portfolio in order to reduce volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the in future earnings. Accenture's loss on investments in the second quarter includes a charge of $212 million, before and after tax, related to the loss the company expects to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. on the sale transaction. After giving effect to the charge, the venture and investment portfolio had a net book value at February 28, 2002, of $109 million, approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. half of which was hedged hedge n. 1. A row of closely planted shrubs or low-growing trees forming a fence or boundary. 2. A line of people or objects forming a barrier: a hedge of spectators along the sidewalk. . Accenture expects to receive offers that allow it to retain a modest percentage of ownership in the venture and investment portfolio through an ongoing alliance with the buyer. Any existing alliance or client relationships with portfolio companies will not be affected. Accenture has engaged an investment bank and has completed the initial screening of prospective purchasers. The company hopes to complete the transaction by the end of the calendar year. Accenture said that, going forward, it will discontinue dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: direct venture-capital investing and will no longer accept illiquid Illiquid An asset or security that cannot be converted into cash very quickly (or near prevailing market prices). Notes: A house is a good example of an illiquid asset. See also: Cash, Liquidity Illiquid In the context of finance. securities from clients or alliance partners. Strong growth in two of Accenture's five operating groups, formerly called global market units, contributed to its solid second-quarter results. Net revenues for Accenture's Government and Resources operating groups were $324 million and $525 million, respectively, increases of 36 percent and 11 percent, respectively, over the second quarter of fiscal 2001. Accenture's Products operating group reported net revenues of $647 million, a 1 percent increase over the strong second quarter of fiscal 2001. Second-quarter net revenues for the Communications & High Tech and 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. operating groups were $751 million and $663 million, respectively, down 7 percent and 6 percent, respectively, from their second-quarter fiscal 2001 levels. The lower level of revenue decreases in these operating groups, compared to the decreases in the first quarter of fiscal 2002, suggest that the financial services, communications and technology sectors appear to be stabilizing stabilizing, v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers. . Net revenues in Accenture's 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 and Africa
(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. ) geographic region were $1.26 billion, an increase of 12 percent
in US dollars and 16 percent in local currency over the second quarter
of fiscal 2001. Net revenues in the Asia Pacific region were $178
million, a decrease of 8 percent in US dollars. In local currency, net
revenues in the Asia Pacific region were flat. Net revenues in the
Americas A·mer·i·cas , theSee America. region were $1.47 billion, a decrease of 6 percent in US dollars and 5 percent in local currency. Accenture will host a conference call at 8:00 a.m. (EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) today to discuss its second-quarter fiscal 2002 financial results and other matters. To participate, please dial +1 (877) 260-8899 (+1 (651) 291-0561 outside 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. , 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 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 ) approximately 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/investor. A replay of the conference call will be available at www.accenture.com/investor, or by dialing +1 (800) 475-6701 (+1 (320) 365-3844 outside the United States, Puerto Rico and Canada) and entering the passcode 633967 from 11:30 a.m. (EDT) Thursday Thursday: see week. , April 11 through 11:59 p.m. (EDT) Sunday Sunday: see Sabbath; week. , April 28. About Accenture Accenture is the world's leading 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 and technology services organization. Through its network of businesses approach -- in which the company enhances its consulting and outsourcing expertise through alliances, affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. and other capabilities --Accenture delivers innovations that help clients across all industries quickly realize their visions. With more than 75,000 people in 47 countries, the company generated net revenues of $11.44 billion for the fiscal year ended August 31, 2001. Its home page is http://www.accenture.com. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , the accuracy of which is necessarily subject to risks and uncertainties. Factors that could cause actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. include general economic conditions and the factors discussed under the heading "Forward-Looking Statements and Certain Factors That May Affect Our Business" in the reports and other documents that we file with the Securities and Exchange Commission, including our most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission.
ACCENTURE LTD
SUMMARY OF REVENUES
For the Three Months Ended February 28, 2002 and 2001 and
For the Six Months Ended February 28, 2002 and 2001
(unaudited)
(In thousands of U.S. dollars)
Percent
Percent increase/ Percent
Three Months Ended increase/ (decrease) of Total
February 28, (decrease) Local 2002 Net
2002 2001 US$ currency Revenues
------------------- --------- --------- --------
OPERATING GROUPS
Communication
& High Tech $751,366 $809,447 (7)% 26%
Financial Services 662,639 706,139 (6)% 23%
Government 323,687 237,794 36 % 11%
Products 646,975 642,423 1 % 22%
Resources 525,431 473,994 11 % 18%
Other 3,191 11,901 (73)% 0%
--------- --------- ----- ----
TOTAL Net Revenues 2,913,289 2,881,698 1 % 100%
====
Reimbursements 496,813 502,361 (1)%
---------- ----------
TOTAL REVENUES $3,410,102 $3,384,059 1 %
========== ==========
GEOGRAPHY
Americas 1,470,726 1,563,973 (6)% (5)% 51%
EMEA 1,264,846 1,124,827 12 % 16 % 43%
Asia Pacific 177,717 192,898 (8)% 0 % 6%
---------- --------- ----
TOTAL
Net Revenues 2,913,289 2,881,698 1 % 3 % 100%
=====
Reimbursements 496,813 502,361 (1)%
---------- ---------
TOTAL REVENUES $3,410,102 $3,384,059 1 %
========== ==========
Percent
Percent increase/ Percent
Six Months Ended increase/ (decrease) of Total
February 28, (decrease) Local 2002 Net
2002 2001 US$ currency Revenues
------------------- --------- --------- --------
OPERATING GROUPS
Communication
& High Tech $1,494,581 $1,674,317 (11)% 25%
Financial
Services 1,379,346 1,464,702 (6)% 24%
Government 660,206 450,897 46% 11%
Products 1,296,804 1,174,827 10% 22%
Resources 1,066,339 934,744 14% 18%
Other 4,643 13,509 (66)% 0%
---------- ---------- -----
TOTAL
Net Revenues 5,901,919 5,712,996 3% 100%
=====
Reimbursements 916,693 909,355 1%
---------- ----------
TOTAL REVENUES $6,818,612 $6,622,351 3%
========== ==========
GEOGRAPHY
Americas 2,912,064 3,115,064 (7)% (5)% 49%
EMEA 2,591,292 2,180,761 19 % 19% 44%
Asia Pacific 398,563 417,171 (4)% 3% 7%
---------- ----------
TOTAL
Net Revenues 5,901,919 5,712,996 3% 5% 100%
=====
Reimbursements 916,693 909,355 1%
---------- ----------
TOTAL REVENUES $6,818,612 $6,622,351 3%
========== ==========
ACCENTURE LTD
CONSOLIDATED INCOME STATEMENT
COMBINED PRO FORMA INCOME STATEMENT
For the Three Months Ended February 28, 2002 and 2001
(unaudited)
(In thousands of U.S. dollars except share data)
Combined Pro
Consolidated Income forma Income
Statement 2002 Statement 2001 (1)
------------------- ------------------
% of Net % of Net
Revenues Revenues
-------- --------
REVENUES:
Revenues
before reimbursements
(Net revenues) $2,913,289 100% $2,881,698 100%
Reimbursements 496,813 17% 502,361 17%
---------- ---- ---------- ----
Revenues 3,410,102 117% 3,384,059 117%
OPERATING EXPENSES:
Cost of services :
Cost of services
before reimbursable expenses 1,708,108 59% 1,791,484 62%
Reimbursable expenses 496,813 17% 502,361 17%
---------- --- --------- ----
Cost of services 2,204,921 76% 2,293,845 80%
Sales and marketing 398,900 14% 345,160 12%
General and
administrative costs 418,002 14% 391,860 14%
---------- --- --------- ----
Total operating expenses 3,021,823 104% 3,030,865 105%
--------- ----
OPERATING INCOME 388,279 13% 353,194 12%
Gain (loss) on investments, net (210,951) (7%) (29,945) (1%)
Interest income 9,255 0% 19,846 1%
Interest expense (13,774) 0% (10,680) 0%
Other income (expense) . 9,689 0% 16,838 1%
Equity in losses of affiliates (12,664) 0% (21,220) (1%)
---------- --- --------- ----
INCOME BEFORE TAXES 169,834 6% 328,033 11%
Provision for taxes 145,057 5% 129,568 4%
---------- --- --------- ----
INCOME BEFORE
MINORITY INTEREST (2) 24,777 1% 198,465 7%
Minority interest (14,166) 0% (117,572) (4%)
---------- --- --------- ----
NET INCOME $ 10,611 0% $ 80,893 3%
========== ==== ========= ====
EARNINGS PER SHARE:
- Basic $ 0.03 $ 0.20
========== =========
- Diluted $ 0.02 $ 0.20
========== =========
ADJUSTED TO EXCLUDE GAIN (LOSS) ON INVESTMENTS, NET
INCOME BEFORE MINORITY
INTEREST AS REPORTED $ 24,777 $ 198,465
Add Back: Gain (loss) on
investments, net of tax impact (211,350) (17,373)
--------- ----------
ADJUSTED INCOME
BEFORE MINORITY INTEREST $ 236,127 $ 215,838
========= ==========
ADJUSTED EARNINGS PER SHARE:
- Basic $ 0.24 $ 0.21
========= ==========
- Diluted $ 0.23 $ 0.21
========= ==========
WEIGHTED AVERAGE SHARES:
- Basic 409,576,609 412,705,954
- Diluted 1,035,794,758 1,008,163,290
ACCENTURE LTD
CONSOLIDATED INCOME STATEMENT
COMBINED PRO FORMA INCOME STATEMENT
For the Six Months Ended February 28, 2002 and 2001
(unaudited)
(In thousands of U.S. dollars except share data)
Combined Pro
Consolidated Income forma Income
Statement 2002 Statement 2001 (1)
------------------- ------------------
% of Net % of Net
Revenues Revenues
-------- --------
REVENUES:
Revenues before reimbursements
(Net revenues) $ 5,901,919 100% $ 5,712,996 100%
Reimbursements 916,693 16% 909,355 16%
----------- ---- ----------- ----
Revenues 6,818,612 116% 6,622,351 116%
OPERATING EXPENSES:
Cost of services :
Cost of services before
reimbursable expenses 3,514,289 60% 3,502,074 61%
Reimbursable expenses 916,693 16% 909,355 16%
----------- ---- --------- ----
Cost of services 4,430,982 75% 4,411,429 77%
Sales and marketing 759,135 13% 671,978 12%
General and
administrative costs 825,959 14% 797,337 14%
----------- ---- --------- ----
Total operating expenses 6,016,076 102% 5,880,744 103%
----------- ---- --------- ----
OPERATING INCOME 802,536 14% 741,607 13%
Gain (loss) on investments, net (305,688) (5%) 189,159 3%
Interest income 24,040 0% 42,395 1%
Interest expense (23,544) 0% (20,110) 0%
Other income (expense) 1,756 0% 23,513 0%
Equity in losses of affiliates (6,463) 0% (41,661) (1%)
---------- ---- -------- ----
INCOME BEFORE TAXES 492,637 8% 934,903 16%
Provision for taxes 267,722 5% 373,961 7%
---------- ---- -------- ----
INCOME BEFORE
MINORITY INTEREST (2) 224,915 4% 560,942 10%
Minority interest (132,628) (2%) (331,572) (6%)
---------- ---- -------- ----
NET INCOME $ 92,287 2% $ 229,370 4%
========== ==== -======== ====
EARNINGS PER SHARE:
- Basic $ 0.23 $ 0.56
========== =========
- Diluted $ 0.22 $ 0.56
========== =========
ADJUSTED TO EXCLUDE GAIN (LOSS) ON INVESTMENTS, NET
INCOME BEFORE MINORITY
INTEREST AS REPORTED $ 224,915 $ 560,942
Add Back: Gain (loss) on
investments, net of tax impact (269,387) 113,495
---------- ----------
ADJUSTED INCOME
BEFORE MINORITY INTEREST $ 494,302 $ 447,447
========== ==========
ADJUSTED EARNINGS PER SHARE:
- Basic $ 0.50 $ 0.44
========== ==========
- Diluted $ 0.48 $ 0.44
========== ==========
WEIGHTED AVERAGE SHARES:
- Basic 410,027,002 412,705,954
- Diluted 1,027,557,818 1,008,163,290
NOTES TO CONSOLIDATED AND COMBINED PRO FORM INCOME STATEMENTS
(1) For the three months and six months ended February 28, 2001,
Partnership Income Before Partner Distributions, as reported
under generally accepted accounting principles, was $419,539
and $1,617,980, respectively. Earnings per share were not
presented because Accenture operated as a series of related
partnerships and corporations under the control of its
partners.
- Pro forma results for fiscal 2001 reflect adjustments to (1)
eliminate the effects of one-time events directly attributable
to our transition to a corporate structure and our initial
public offering and related transactions and (2) present
results as if our transition to a corporate structure had
occurred on September 1, 2000. One-time items eliminated
include reorganization costs of $8,000 for the three months
ended February 28, 2001 and $13,000 for the six months ended
February 28, 2001 relating to our transition to a corporate
structure, rebranding costs of $151,000 for the three months
ended February 28, 2001 and $176,000 for the six months ended
February 28, 2001 to rename the organization, and income of
$188,000 for the six months ended February 28, 2001 due to the
adoption of SFAS 133. Adjustments to reflect the transition to
a corporate structure include $329,000 for the three months
ended February 28, 2001 and $810,000 for the six months ended
February 28, 2001 of operating expenses for partner
compensation and $5,000 for the three months ended February
28, 2001 and $10,000 for the six months ended February 28,
2001 of interest expense related to retirement benefits
payable to the partners.
- Provision for taxes has been adjusted to include the tax
effect on the pro forma adjustments and to reflect an
estimated corporate tax expense to present results on a
corporate basis. Minority interest has been adjusted as if the
minority had existed for the three months ended February 28,
2001 and six months ended February 28, 2001. Minority interest
and earnings per Class A share are based on the assumption
that shares and share equivalents outstanding as of August 31,
2001, were outstanding for the entire fiscal year ended August
31, 2001.
- Additional information is provided in Accenture's filings with
the Securities and Exchange Commission.
(2) Income before minority interest represents the consolidated
income of Accenture Ltd earned through its subsidiary,
Accenture SCA, without regard to Accenture Ltd's ownership
percentage in Accenture SCA. The minority interest expense
represents the Accenture SCA income attributable to the
partners who have an equity ownership directly in Accenture
SCA. The resulting net income of Accenture Ltd represents the
income attributable to the shareholders of Accenture Ltd.
ACCENTURE LTD
CONSOLIDATED BALANCE SHEETS
August 31, 2001 and February 28, 2002
(In thousands of U.S. dollars)
August 31, February 28,
2001 2002
----------- ------------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,880,083 $ 1,131,431
Receivables from clients, net 1,498,812 1,385,721
Unbilled services 731,802 923,461
Other current assets 468,940 418,442
----------- -----------
Total current assets 4,579,637 3,859,055
----------- -----------
NON-CURRENT ASSETS:
Investments 324,139 109,170
Property and equipment, net 822,318 747,197
Other non-current assets 335,262 483,648
----------- -----------
Total non-current assets 1,481,719 1,340,015
----------- -----------
TOTAL ASSETS $ 6,061,356 $ 5,199,070
=========== ===========
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Short-term debt $ 190,669 $ 160,659
Accounts payable 371,794 409,678
Deferred revenue 810,043 508,962
Accrued payroll and related benefits 1,050,385 1,268,154
Other accrued liabilities 1,755,929 659,933
----------- -----------
Total current liabilities 4,178,820 3,007,386
----------- -----------
NON-CURRENT LIABILITIES:
Long-term debt 1,090 4,263
Other non-current liabilities 1,191,332 1,358,062
----------- -----------
Total non-current liabilities 1,192,422 1,362,325
----------- -----------
MINORITY INTEREST 407,926 567,642
----------- -----------
EQUITY:
Shareholders' equity 282,188 261,717
----------- -----------
Total equity 282,188 261,717
----------- -----------
TOTAL LIABILITIES AND EQUITY $ 6,061,356 $ 5,199,070
=========== ===========
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