01—Abstract
Summary
Summary of the 10-K filed October 24, 2014. Cited figures are marked; the original filing is the authoritative source.
Accenture plc's 2014 10-K filing reveals a company with consistent revenue growth, reaching $30.0 billiona in net revenues for fiscal year 2014.
This growth was driven by both its consulting and outsourcing segments, with outsourcing showing particularly strong double-digit percentage increases in the fourth quarter of fiscal 2014. The company's diversified operating groups across various industries and geographies contributed to this performance. Accenture continues to emphasize its global delivery model, strategic growth platforms (Strategy, Digital, Technology, Operations), and commitment to innovation through research and development spending.
Key financial highlights include stable operating income and a healthy cash position, though margins experienced some pressure due to pricing challenges and increased payroll costs in the first half of fiscal 2014. The company also actively engaged in share repurchases, returning value to shareholders. Accenture faces a competitive market and various risks, including economic volatility, cybersecurity threats, and the need to adapt to technological changes, all of which are detailed in the risk factors section.
02—Key points
Key Highlights
- Accenture reported net revenues of $30.0 billion for fiscal year 2014, representing a 5% increase in U.S. dollars and local currency compared to fiscal year 2013.
- The outsourcing business demonstrated strong growth, with net revenues increasing by 8% in both U.S. dollars and local currency year-over-year, and showing a 15% increase in the fourth quarter of fiscal 2014.
- The company's five operating groups (Communications, Media & Technology; Financial Services; Health & Public Service; Products; Resources) collectively served a broad range of industries globally.
- Accenture maintained a strong global delivery model, leveraging over 205,000 professionals in its network, which is a key differentiator.
- The company invested $640 million in research and development in fiscal year 2014 to drive innovation and develop new business and technology solutions.
- Accenture's effective tax rate for fiscal 2014 was 26.1%, compared to 18.1% in fiscal 2013, with the prior year benefiting from reorganization and tax audit settlements.
- The company continued its share repurchase program, authorizing $4.7 billion for share purchases and redemptions as of August 31, 2014, indicating a commitment to returning capital to shareholders.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2014, Accenture plc kept $0.09.
- Revenue$31.87B100.0%
- Cost of revenue−$22.19B69.6%
- Gross profit$9.68B30.4%
- Operating costs−$5.38B16.9%
- Operating income$4.30B13.5%
- Interest, other & tax−$1.36B4.3%
- Net income$2.94B9.2%
Where FY2014 revenue went
$31.87B- Cost of revenue: $22.19B, 70% of revenue
- Other operating costs: $4.74B, 15% of revenue
- Net income: $2.94B, 9.2% of revenue
- R&D: $639.5M, 2.0% of revenue
- Interest, other & tax: $1.36B, 4.3% of revenue
Kept 9.2% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2014filed October 24, 2014Financial Statements
FY2014 against FY2013
| Line item | FY2014FY2013 | Change |
|---|---|---|
| Revenue | $31.87B$30.39B | +4.9% |
| Cost of Revenue | $22.19B$21.01B | +5.6% |
| Gross Profit | $9.68B$9.38B | +3.2% |
| R&D Expenses | $639.51M$715.09M | −10.6% |
| Operating Expenses | $27.57B$26.06B | +5.8% |
| Operating Income | $4.30B$4.34B | −0.9% |
| Interest Expense | $17.62M$14.04M | +25.6% |
| Net Income | $2.94B$3.28B | −10.4% |
| EPS (Basic) | $4.64$5.08 | −8.7% |
| EPS (Diluted) | $4.52$4.93 | −8.3% |
| Shares Outstanding (Basic) | 634.22M645.54M | −1.8% |
| Shares Outstanding (Diluted) | 692.39M713.34M | −2.9% |
05—Questions
Frequently Asked Questions
What was Accenture's overall financial performance in fiscal year 2014?
Accenture reported net revenues of $30.0 billion for fiscal year 2014, a 5% increase in both U.S. dollars and local currency compared to fiscal year 2013. Operating income was $4.3 billion, slightly down from $4.34 billion in the prior year, with operating margin at 14.3% compared to 15.2% in fiscal 2013 (which included a reorganization benefit). Diluted earnings per share were $4.52 for fiscal 2014.
How did Accenture's consulting and outsourcing businesses perform?
The consulting business saw net revenues increase by 2% in U.S. dollars and 3% in local currency year-over-year, reaching $15.7 billion. The outsourcing business performed more strongly, with net revenues up 8% in both U.S. dollars and local currency to $14.3 billion. The fourth quarter of fiscal 2014 showed particularly robust growth in outsourcing, up 15% in U.S. dollars.
What are the primary risks Accenture highlighted in its 2014 10-K?
Accenture identified several key risks, including the impact of volatile economic conditions on client spending, intense competition from various types of providers, cybersecurity threats and data protection failures, the need to adapt to rapid technological changes, challenges in balancing skills and resources with client demand, and foreign currency exchange rate fluctuations.
How is Accenture structured, and what are its main service offerings?
Accenture operates through five reportable operating groups: Communications, Media & Technology; Financial Services; Health & Public Service; Products; and Resources. These groups are supported by four growth platforms: Accenture Strategy, Accenture Digital, Accenture Technology, and Accenture Operations. Their services encompass management consulting, technology services, and outsourcing.
06—Continue