Capgemini : Solid performance in H1 2012 Growth outlook revised upwards and target increase in operating margin confirmed
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Solid performance in H1 2012
Growth outlook revised upwards and
target increase in operating margin confirmed
Paris, July 26, 2012 - The Board of Directors of Cap Gemini S.A. chaired by Paul
Hermelin, convened in Paris on July 25, 2012 to review and authorize for issue
the accounts of Capgemini Group for the first half of 2012. The key figures are
as follows:
+-----------------------------------------------------+-------+-------+--------+
|(in millions of euros) |H1 2011|H1 2012| Change |
+-----------------------------------------------------+-------+-------+--------+
|Revenues | 4,756| 5,150| +8.3%|
+-----------------------------------------------------+-------+-------+--------+
|Operating margin(()[1]()) | 289| 328| Â |
| | | | |
| as a % of revenues| 6.1%| 6.4%|+0.3 pts|
+-----------------------------------------------------+-------+-------+--------+
|Operating profit(()[2]()) | 240| 237| Â |
+-----------------------------------------------------+-------+-------+--------+
|Group profit for the period | 127| 143| Â |
| | | | |
| as a % of revenues| 2.7%| 2.8%| +0.1 pt|
+-----------------------------------------------------+-------+-------+--------+
|Net cash and cash equivalents at the end of the half-| 169| 27| Â |
|year | | | |
+-----------------------------------------------------+-------+-------+--------+
The Group reports growth in published revenues (i.e. at current Group structure
and exchange rates) on the first half of 2011 of 8.3% and like-for-like growth
(i.e. at constant Group structure and exchange rates) of 2.3%: the difference
between these two rates is mainly due to favorable exchange rate effects and the
integration of companies acquired into the Group, and particularly Prosodie in
France.
Bookings in the first half of the year totaled €5,113 million. In Q2 2012 alone,
bookings increased 7.6% period-on-period, confirming the resistance of demand.
This quarter was marked by dynamic activity in the Outsourcing Services
business, which reported a 21.4% increase in bookings. In addition, for the
Consulting Services, Technology Services and Local Professional Services
(Sogeti) businesses, the book-to-bill ratio was 1.09 for the half-year and 1.16
for Q2 alone.
The operating margin rate is 6.4%, up 0.3 points on the first half of 2011, in
line with the outlook communicated in February by the Group. Restructuring costs
- notably relating to measures implemented to turn-around Group activity in the
Netherlands - total €75 million in the first half of the year. Operating profit
is practically stable at €237 million.
After a net financial expense of €49 million and an income tax expense of €55
million, Group profit for the period is €143 million, up 12.6% on the first half
of 2011.
After payment of the dividend of €1 per share (€154 million) and given the
seasonal increase in working capital requirements, consolidated net cash and
cash equivalents total €27 million as of June 30, 2012. This balance includes
the €48.4 million payment by Caixa Participações, the public investment
subsidiary of Caixa Econômica Federal - the fourth largest Brazilian bank - for
the acquisition of a 22% stake in the share capital of CPM Braxis Capgemini.
Outlook:
Despite the macro-economic uncertainties that still remain in the majority of
countries, Capgemini is well placed to exceed its initial objective of
approximately nil annual organic growth and is now aiming for like-for-like
growth in excess of 1% for the year as a whole. Furthermore, the Group confirms
its objective of an increase in the operating margin in line with the general
consensus over the whole year.
In addition, the Group plans to buyback shares in the minimum amount of €100
million over the next 12 months, in order to neutralize all or part of the
dilution generated by the issue of new shares under the international share
ownership plan.
For Paul Hermelin, Chairman and Chief Executive Officer of Capgemini Group:
"Despite a listless macro-economic context, we have enjoyed a solid first half-
year; the quality of bookings, in particular, demonstrates that the strategy to
refocus our portfolio on high value-added services is bearing fruit. In the
second half of the year, the Group is more than ever mobilized to meet our
clients' needs, with innovative offerings focused essentially on cloud
computing, mobility, Big Data and solutions."
o0o
Appendix
Operations by major region:
* France reported revenue growth of 7.4%, thanks to the integration of
Prosodie (activity fell slightly like-for-like). The operating margin rate
is 6.2%, down on the first-half of 2011.
* The United Kingdom and Ireland reported growth of 8.3% (+2.3% like-for-
like), despite budget austerity in the public sector. The operating margin
rate improved 0.7 points on the first half of 2011 to 6.8%.
* North America enjoyed excellent performance, both in terms of growth and
profitability. Revenues surged 19.7% (9.7% like-for-like). The region also
continues to improve its operating margin rate, which reached 8.7%, double
the level reported in the first half of 2010.
* Benelux, severely affected by the crisis, reported a contraction in revenues
(-10.3%) and its operating margin rate to 4.5% (compared to 6.2% in H1
2011). The Group has defined an action plan aimed at adapting the activity
portfolio and the organizational structure of its Dutch subsidiaries to
changes in client demand and returning the region to double-digit
profitability.
* In the other regions revenue growth was 6.8% (like-for-like) - driven by the
dynamism of the Nordic countries (+12.4%) and the Asia Pacific region
(+19.8%) - and the operating margin rate is 7.7%, up significantly on the
first half of 2011 (+1.8 points).
Operations by business:
* Technology Services reported the highest growth in the Group, with revenues
increasing 4.8% (like-for-like). The operating margin rate is 6.7%, up 0.9
points on the first half of 2011, primarily driven by improved profitability
in North America.
* Outsourcing Services reported like-for-like growth of 0.9%, with BPO
remaining the most dynamic business. The operating margin rate improved
slightly on the first half of 2011 to 5.9% (+0.2 points).
* Sogeti reported moderate growth in revenues of 0.6% (like-for-like); the
operating margin rate fell back slightly to 9.5%.
* Consulting Services reported a slight downturn in activity (-0.5% like-for-
like), although it nonetheless enjoyed limited growth in the second quarter
(+1.4% period-on-period). Despite a fall of one point in the profitability
of this business on the first-half of 2011 to 10.8%, it nonetheless remains
the Group's most profitable business.
Headcount:
As of June 30, 2012, the total headcount of the Group was 121,026, up 6% on one
year previously. Capgemini recruited nearly 15,000 new employees in the first
half of the year. The headcount includes 46,105 offshore employees including
nearly 37,000 in India, representing 38% of the total headcount.
o0o
[1](()() )Operating margin is one of the Group's key performance indicators. It
is defined as the difference between revenues and operating costs, these being
equal to the cost of services rendered (expenses incurred during project
delivery) plus selling and general and administrative expenses.
[2](()() )Operating profit of the Group incorporates the charges associated with
shares or options allocated to a large number of employees, as well as other
non-recurring income and expenses such as goodwill impairment, capital gains or
losses on disposals, restructuring costs, the cost of acquiring and integrating
acquired companies, as well as the impacts of the curtailment and/or settlement
of defined benefit pension plans.
PR Capgemini H1 results:
http://hugin.info/152779/R/1629485/521916.pdf
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