Accenture plc Quarterly Report for Q2 Ended Feb 28, 2014

Summary

Accenture plc's (ACN) Form 10-Q filing for the period ending February 28, 2014, reveals a slight increase in net revenues of 1% in U.S. dollars (3% in local currency) for both the three and six-month periods compared to the prior year. This growth was primarily driven by the outsourcing segment, which saw a 4-5% increase, while consulting revenues remained flat or slightly decreased. The company's operating income and margins experienced a notable decline compared to the prior year, partly due to the absence of significant one-time benefits recorded in the prior year's comparable periods, as well as pricing pressures and increased investments. Despite these pressures, Accenture demonstrated a strong cash flow from operations and continued its share repurchase program.

Key Highlights

• 1Net revenues increased by 1% (3% in local currency) year-over-year for both the three and six-month periods ending February 28, 2014.
• 2Outsourcing net revenues showed robust growth of 4-5% year-over-year, while consulting net revenues were flat or slightly decreased.
• 3Operating income decreased by 18% for the three-month period and 8% for the six-month period compared to the prior year.
• 4Operating margin declined to 13.3% for the quarter and 14.1% for the year-to-date period, down from 16.5% and 15.5% respectively, largely due to the absence of prior-year benefits.
• 5The company acquired Procurian Inc. for $386.3 million, significantly increasing its goodwill balance by $302.6 million.
• 6Cash and cash equivalents decreased from $5.6 billion to $3.7 billion, reflecting strong investment in acquisitions and increased share repurchases and dividends.
• 7Diluted earnings per share decreased to $1.03 for the quarter and $2.18 for the six months, impacted by prior-year tax benefits and reorganization benefits.

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