Q4 2018

For the fourth quarter, net revenues were $10.1 billion, an increase of 11 percent in both U.S. dollars and local currency compared with the fourth quarter of fiscal 2017. Diluted earnings per share were $1.58, a 7 percent increase from $1.48 for the fourth quarter last year. Operating margin for the fourth quarter of fiscal 2018 was 14.3 percent, an expansion of 10 basis points.
Operating cash flow was $2.1 billion and free cash flow was $1.9 billion. New bookings were $10.8 billion.
Pierre Nanterme, Accenture’s chairman and CEO, said, “We are very pleased with our
outstanding financial results for the fourth quarter and the full fiscal year 2018. For the year, our broad-based revenue growth of 10.5 percent in local currency and record new bookings of $42.8 billion reflect continued excellent demand for our services. We also delivered 14 percent EPS growth on an adjusted basis, generated very strong free cash flow and returned $4.3 billion
in cash to our shareholders.
We continue to benefit from the significant investments we have made to further strengthen our leadership position in high-growth areas such as digital, cloud and security services, which accounted for approximately 60 percent of total revenues for the year. Our growth strategy and innovation-led approach are clearly resonating with our clients. With our durable business model
and disciplined management, we are very well-positioned to continue gaining market share and delivering value for our clients and shareholders.”

https://newsroom.accenture.com/news/accenture-reports-very-strong-fourth-quarter-and-full-year-fiscal-2018-results.tekdownload

A Accenture Plc (NYSE: ACN) divulgou seu resultado trimestral na quinta-feira, 27 de setembro. A empresa reportou US $ 1,58 EPS no trimestre, superando a estimativa de consenso do mercado, que era de US $ 1,56, por US $ 0,02. A companhia reportou receita de US $ 10,15 bilhões no trimestre, ao passo que a estimativa de consenso era de US $ 10,01 bilhões. A Accenture teve um retorno sobre o patrimônio líquido de 41,92% e uma margem líquida de 9,76%. A receita trimestral do negócio subiu 10,9% em relação ao mesmo trimestre do ano passado. Durante o mesmo período do ano anterior, a empresa reportou US $ 1,48 EPS.
NYSE:ACN - Stock Price, News, & Analysis for Accenture

Pierre Nanterme - Chairman & CEO
We are extremely pleased with our outstanding financial results for both the fourth quarter and full fiscal year. For the year, we continued to strengthen our leadership position in "the New", Digital, Cloud and Security Services. We gained significant market share growing about three times to market with strong growth in nearly all of our largest markets once again. And we returned very substantial cash to our shareholders.

Here are the few highlights for the year. We delivered record new bookings of $42.8 billion. We’re generating revenues of $39.6 billion, another record and of 10.5% in local currency. I am especially pleased with our balanced growth once again across the dimensions of our business. We delivered record earnings per share of $6.74 on an adjusted basis, a 14% increase.
Operating margin was 14.8%, consistent with last year on an adjusted basis. We’re generating outstanding free cash flow of $5.4 billion. We returned $4.3 billion in cash to shareholders through share repurchases and dividends and we just announced a semi-annual cash dividend of $1.46 per share a 10% increase over our prior dividend.

So, we delivered an excellent year in fiscal 2018 and I feel very good about our business, the durability of our performance and the strong momentum we have as we enter the new fiscal year.
Accenture plc (ACN) CEO Pierre Nanterme on Q4 2018 Results - Earnings Call Transcript | Seeking Alpha

David Rowland - CFO

Thank you, Pierre, and thanks all of you for taking the time to join us on today’s call.

By any measure our fourth quarter results capped off what has been another truly outstanding year for Accenture. These results were underpinned by our ability to manage our business with rigor and discipline while leveraging the full power of Accenture’s unique leadership position in the marketplace to drive significant value for our clients, our people and our shareholders.

Before I get into the details of the quarter let me summarize a few of the important highlights which once again reflects strong execution across all three financial imperatives for driving superior shareholder value. Revenue momentum continued with very strong net revenue growth of 11% in local currency reflecting our fourth consecutive quarter of double-digit growth. Our growth continued to significantly outpace the market reflecting both our leadership position in "the New" and the durability of our diverse yet highly focused growth model.

Our operating margin of 14.3% came in as expected and was up 10 basis points from last year. We were very pleased with our strong underlying profitability, which allowed us to invest significantly in our business and our people, and we delivered EPS of $1.58 in the fourth quarter up 7% from last year. And finally, we delivered free cash flow of $1.9 billion which was better than expected driven by strong growth and profitability and continued industry leading DSOs.

With those high level comments, let me turn to some of the details starting with new bookings. New bookings were $10.8 billion for the quarter reflecting our second highest bookings on record.

Consulting bookings were $6.1 billion, representing an all-time high and a book-to-bill of 1.1, and outsourcing bookings were $4.7 billion, with a book-to-bill of 1.0. The dominant theme continued to be strong demand for "the New" which represented more than 60% of our total bookings.
For the full fiscal year, we delivered nearly $43 billion in new bookings which represents 12% growth in local currency and we were particularly pleased with double-digit bookings growth and strategy and consulting and system integration.

Turning now to revenues. Net revenues for the quarter were $10.1 billion, an 11% increase in both USD and local currency. This was a $100 million above the top-end of our guided range. Our consulting revenues for the quarter were $5.5 billion, up 12% in both USD and local currency, and our outsourcing revenues were $4.6 billion, up 9% in both USD and local currency.

Looking at the trends an estimated revenue growth across our business dimensions, we were especially pleased with the strong balance in our growth with double-digit growth across all dimensions Strategy and Consulting Services, Operations and Application Services. And "the New" including Digital Cloud and Security related services continued to deliver very strong double-digit growth.

Consistent with last quarter, I’d also like to highlight continued strong demand for Intelligent Platform Services, which was an important contributor to our growth. These services primarily relate to deploy next-generation technologies and SAP, Microsoft, Oracle, Salesforce, and Workday.

Taking a closer look at our operating groups, resources led all operating groups with [15%] in local currency, reflecting double-digit growth across all three industries and all three geographies. Communications, Media and Technology grew 15%, driven by continued strong momentum in Software Platforms which posted very strong double-digit growth, especially in North America.

Products delivered its 13th consecutive quarter of double-digit growth with 12% growth in the quarter. We saw strong broad-based growth across all three industries in all three geographies.

H&PS grew 6%, driven by strong growth in public service, as well as double-digit growth in both Europe and the growth markets. We saw flat growth in North America primarily reflecting some pressure in our U.S. federal business.

Finally financial services grew 3% reflecting good growth in insurance and modest growth in banking and capital markets. We saw double-digit growth in the growth markets and solid growth in North America offset by some challenges in Europe. We expect a similar level of growth in the first quarter.

Moving down the income statement, gross margin for the quarter was 31.8%, compared to 31.5% in the same period last year. Sales and marketing expense for the quarter was 10.7%, compared with 11% in the fourth quarter last year. General and administrative expense was 6.7%, compared to 6.4% for the same quarter last year.
Operating income was $1.5 billion in the fourth quarter, reflecting a 14.3% operating margin, up 10 basis points, compared with quarter four last year. Our effective tax rate for the quarter was 28%, compared with an effective tax rate of 23.9% for the fourth quarter last year. The higher tax rate in the fourth quarter was primarily related to an increase in prior year tax liabilities.

Diluted earnings per share were $1.58, compared with EPS of $1.48 in the fourth quarter last year. This reflects a 7% year-over-year increase. Day services outstanding were 39 days, consistent with last quarter and the fourth quarter of last year.

Our free cash flow for the quarter was $1.9 billion, resulting from cash generated by operating activities of $2.1 billion, net of property and equipment additions of $179 million. Our cash balance at August 31 was $5.1 billion compared with $4.1 billion at August 31 last year.

With regards to our ongoing objective to return cash to shareholders in the fourth quarter, we repurchased or redeemed 3.4 million shares for $552 million at an average price of $163.24 per share. This week our Board of Directors approved $5 billion of additional share repurchase authority bringing the total to $6 billion.

As Pierre mentioned, our Board of Directors declared a semi-annual cash dividend of $1.46 per share. This dividend will be paid on November 15, and represents a $0.13 per share or 10% increase over the previous semi-annual dividend we declared in March.

So before I turn it back over to Pierre, I want to reflect on where we landed for the full year across the key elements of our original business outlook provided last September. As a reminder we had two unusual items impacting metrics for this year.

Last year we recorded a settlement charge related to the termination of our U.S. pension plan and this year we recorded charges related to tax law changes. The following comparisons exclude these impacts were applicable and reflect adjusted results.

For the full year net revenues grew 10.5% in local currency well above the top end of the guided range that we provided at the beginning of the year with strong growth across all areas of our business with many posting double-digit growth.

Roughly 80% of our overall growth was attributed to strong organic growth of 8%, and "the New" represented approximately 60% of revenues for the year reflecting our strategic focus to be a market leader in digital cloud and security-related services.

On an adjusted basis, operating margin of 14.8% was consistent with FY 2017 and in line with our updated guidance while slightly below our original guided range. As I mentioned earlier, were pleased with the continued underlying margin improvement that allows us - that has allowed us to continue to invest for long-term market leadership.
On an adjusted basis diluted earnings per share was $6.74 per share reflecting 14% growth over FY 2017 and was above the original guided range primarily driven by strong topline growth. Our free cash flow of $5.4 billion was well above our original guided range again reflecting strong operating discipline and industry-leading DSOs.

And finally, we delivered on the objective of our capital allocation model by returning $4.3 billion of cash to shareholders while investing roughly $660 million to acquire critical skills and capabilities and strategic high-growth areas of the market. So again, we had another outstanding year of broad-based growth resulting in significant market share gains underpinned by strong profitability and cash flow.
Accenture plc (ACN) CEO Pierre Nanterme on Q4 2018 Results - Earnings Call Transcript | Seeking Alpha

Pierre Nanterme - Chairman & CEO

Our outstanding results for fiscal year 2018 demonstrate that we continue to execute our profitable growth strategy of differentiation and competitiveness extremely well.

Our very strong revenue was our new bookings reflect excellent demand for our services. We are clearly leading in "the New" in the marketplace and we have gained significant market share over the last few years, demonstrating that our services and capabilities are highly relevant to our clients agenda.

Over the last five fiscal years we have delivered compound annual revenue growth of 9% in local currency and 10% compound growth in adjusting earnings per share. And I'm especially pleased that over the same period we have delivered a compound annual total return to shareholders of 21%, significantly above the 15% annual total return for the SAP-500.

Our strong and durable performance reflects the relevant investments we have made ahead of the curve to differentiate our offerings and enhance our competitiveness, as well as the rigor and discipline we bring to managing the business.

Our rapid rotation to "the New" digital, cloud and security-related services has contributed significantly to our performance. In fiscal year 2018 "the New", accounted for that $23 billion or approximately 60% of total revenues more than the double the revenues just three years ago.

In digital, I'm especially pleased with the success we have had in growing Accenture Interactive. Today we are the market leader operating at scale for many of the world's leading brands.

We're working with Radisson Hotel Group at their global experience agency to improve customer acquisition and retention for more than 1000 in 80 countries. Accenture Interactive leveraging our travel industry expertise, data analytics and digital marketing capabilities to create more personalized customer experiences.
Why is "the New" has truly become core to our business. As you would expect we continue to invest and innovate to capture new ways of growth. And indeed we are making excellent progress with Accenture industry X.O which we launched recently, where we are helping clients to range that manufacturing with advanced technologies like the Internet of Things, connected devices and digital platforms.

With ABB, the switch industrial manufacturer, we developed an IoT Solution to connect data from smart sensors embedded in its electric models to customers. With a new mobile app portal and sensor platform, ABB can now apply more advanced analytic that's deepen its knowledge about multiple performance, competitive assets and customer needs.

We continue to invest in our industry X.0 capabilities and complete its three acquisitions in the first quarter; Pillar Technology, a software firm in Columbus, Ohio, Mindtribe, a hardware engineering company in San Francisco and Designaffairs, a design firm in Germany.

At the same time, we continue to leverage our unique role in the technology ecosystem as re-leading partner of key platform players including SAP, Microsoft, Oracle and Salesforce which are also rotating rapidly to "the New".

That evolves to a new generation of cloud-enabled platforms with advanced analytic, artificial intelligence and machine learning capabilities. We are working with a broad range of clients across industries around the world to transform their businesses using SAP S/4 HANA Solution from Lion, Australia's largest brewer, to Chelsea, the Latin American utility, to Barilla, the Italian food company.

Turning now to the geographic dimension of our business, I feel very pleased that we deliver another year of very strong broad-based growth in most of our largest market. Starting with North America, I'm delighted with the acceleration in our business with revenue growth of 9% in local currency for the year driven primarily by the United States.

In Europe we continue to drive high single-digit growth. We delivered 9% growth in local currency for the year led by double-digit growth in Germany, Italy, France and Island as well as high single digit growth in Spain.

And finally our gross markets are becoming an increasingly significant contributor to our performance with 16% growth in local currency led once again by very strong double-digit growth in Japan as well as double-digit growth in Australia, Brazil and Singapore.

Before I turn it back to David, I want to share a few thoughts on our talent strategy to continue leading in "the New", which clearly sets us apart in the marketplace. Our people intimacy makes the difference in delivering high quality services to our clients.

And as we transform Accenture, we are making substantial investments to ensure that we have the most relevant and specialized skill and scale to meet our client's needs. And we are particularly focus on attracting and developing the best possible team of leaders in our industry.

And I'm extremely pleased that in fiscal year 2018 we promoted about 700 new managing directors and hired nearly 300 from outside Accenture adding very significant industry expertise and specialization.

At Accenture we continue to believe that diversity is a critical source of competitive advantage. I'm especially proud that just these months, we were named the top company, number on the Thomson Reuters Diversity and Inclusion Index which recognizing the 100 most diverse and inclusive companies in the world.

And finally, I want to thank our 459,000 people for their unique passion and energy which makes all the difference for Accenture and more importantly for our client.
Accenture plc (ACN) CEO Pierre Nanterme on Q4 2018 Results - Earnings Call Transcript | Seeking Alpha