Accenture Ltd, a leading global consulting firm, today posted higher-than-expected quarterly earnings on a rebound in consulting business, but projected profit for the current quarter to miss Wall Street forecasts.
Accenture 's revenue and earnings estimates for fiscal 2005 are also lower than average analysts' estimates as its outsourcing sales growth slows, news that sent the stock down about 7 per cent in premarket trade.
Accenture's CEO, Mr William D. Green, said, "We are pleased with our results, which reflect our ongoing success in helping clients become high-performance businesses. We are encouraged by the continued gains we achieved in our consulting business, and by growth in our outsourcing business, which now accounts for 37 per cent of our net revenues".
"Looking ahead, we believe we are well positioned to build on our success during the past year. We have a healthy balance sheet, a strong cash position and a positive outlook for fiscal year 2005," he added.
For the fourth quarter ended on Aug. 31, net income rose to $183 million, or 30 cents a share, from $120.5 million, or 25 cents a share, a year earlier.
Revenue before client reimbursement rose to $3.42 billion from $3.02 billion, slightly lower than analysts' view of $3.48 billion. Sales of consulting, its main business that has been rebounding from a slump for about a year, increased 12 per cent.
Outsourcing, which includes work such as helpdesk and call centers, rose 17 per cent, lower than its previous quarters.
The company noted that the payment of bonuses and a higher percentage of outsourcing business had eroded its profitability.
Gross margins, or profitability after production costs, fell to 32.4 per cent from 34.4 per cent a year earlier.
Accenture accrued employee bonuses-related expenses, of $125 million in the fourth quarter.
The company had no variable compensation expense in the year-ago quarter. The stock fell to $24.75 from a close of $26.58 in premarket trade.
Additional reporting Reuters