01—Abstract
Summary
Summary of the 10-Q filed June 24, 2021. Cited figures are marked; the original filing is the authoritative source.
Accenture plc reported strong financial performance for the third quarter and nine months ended May 31, 2021.
Total revenues increased by 21%a in U.S. dollars (16% in local currency) for the quarter and 11% in U.S. dollars (8% in local currency) for the nine-month period compared to the prior year. This growth was driven by robust demand across all geographic markets and service lines, particularly in consulting and outsourcing, fueled by clients accelerating their digital transformation initiatives. The company demonstrated improved profitability, with operating margin increasing to 16.0% for the quarter and 15.3% for the nine months.
Net income attributable to Accenture plc rose significantly, reflecting strong revenue growth and effective cost management. Accenture also maintained a solid liquidity position, with cash and cash equivalents increasing to $10.0 billionb. The company continued its commitment to returning capital to shareholders through share repurchases and dividends.
02—Key points
Key Highlights
- Revenues grew 21% year-over-year in USD to $13.3 billion for Q3 FY21 and 11% year-over-year in USD to $37.1 billion for the first nine months of FY21.
- Operating income increased by 24% to $2.1 billion for Q3 FY21, and by 14% to $5.7 billion for the first nine months of FY21.
- Diluted earnings per share (EPS) were $2.40 for Q3 FY21, a substantial increase from $1.90 in Q3 FY20. Nine-month diluted EPS reached $6.96, up from $5.90 in the prior year.
- Gross margin improved to 33.2% for Q3 FY21 and 32.1% for the first nine months of FY21, up from 32.1% and 31.5% respectively in the prior year periods.
- Cash and cash equivalents stood at $10.0 billion as of May 31, 2021, an increase from $8.4 billion at the end of FY20, indicating strong liquidity.
- New bookings reached $15.4 billion for Q3 FY21, with consulting bookings at $8.0 billion and outsourcing bookings at $7.4 billion, demonstrating continued strong demand.
- Headcount increased to approximately 569,000 as of May 31, 2021, reflecting increased demand for services and headcount added through acquisitions.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2021, Accenture plc kept $0.12.
- Revenue$13.26B100.0%
- Cost of revenue−$8.86B66.8%
- Gross profit$4.40B33.2%
- Operating costs−$2.29B17.2%
- Operating income$2.12B16.0%
- Interest, other & tax−$569.2M4.3%
- Net income$1.55B11.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2021filed June 24, 2021Financial Statements
Q3 FY2021 against Q3 FY2020
| Line item | Q3 FY2021Q3 FY2020 | Change |
|---|---|---|
| Revenue | $13.26B$10.99B | +20.7% |
| Cost of Revenue | $8.86B$7.46B | +18.7% |
| Gross Profit | $4.40B$3.53B | +24.8% |
| Operating Expenses | $11.15B$9.28B | +20.1% |
| Operating Income | $2.12B$1.71B | +23.7% |
| Interest Expense | $28.74M$4.96M | +479.3% |
| Net Income | $1.55B$1.23B | +26.2% |
| EPS (Basic) | $2.44$1.93 | +26.4% |
| EPS (Diluted) | $2.40$1.90 | +26.3% |
| Shares Outstanding (Basic) | 635.20M636.15M | −0.1% |
| Shares Outstanding (Diluted) | 645.45M645.61M | 0.0% |
05—Questions
Frequently Asked Questions
What was Accenture's revenue growth in the third quarter of fiscal year 2021?
Accenture reported a 21% increase in revenues in U.S. dollars to $13.3 billion for the third quarter of fiscal year 2021, compared to the same period in the prior year. In local currency, revenue grew by 16%.
How did Accenture's profitability perform in the third quarter of fiscal year 2021?
Operating income for the third quarter of fiscal year 2021 increased by 24% to $2.1 billion, and operating margin improved to 16.0%, up from 15.6% in the prior year's third quarter. Diluted earnings per share (EPS) rose to $2.40 from $1.90 in the prior year.
What is the outlook for Accenture's remaining performance obligations?
Accenture had approximately $22 billion in remaining performance obligations as of May 31, 2021. The company expects to recognize about 39% of this amount as revenue in fiscal 2021, an additional 37% in fiscal 2022, and the remainder thereafter. This excludes the non-cancelable portion of contracts and variable consideration.
How is Accenture managing its cash and capital allocation?
Accenture maintained a strong liquidity position with $10.0 billion in cash and cash equivalents as of May 31, 2021. The company generated robust operating cash flows and plans to continue using a significant portion of this cash for share repurchases and dividends, as demonstrated by $2.78 billion in share purchases during the first nine months of fiscal 2021.
06—Continue