Accenture Reports Strong Third-Quarter Fiscal 2007 Financial Results

Revenues increase 15% to record $5.08 billion, including record consulting revenues of $3.08 billion and record outsourcing revenues of $2.00 billion

Company reports EPS of $0.54; raises EPS outlook for full fiscal year 2007 to range of $1.94 to $1.96

New bookings of $6.22 billion include record consulting bookings of $3.50 billion

NEW YORK--()--Accenture (NYSE: ACN) reported strong financial results for the third quarter of fiscal 2007, ended May 31, with record net revenues of $5.08 billion, a year-over-year increase of 15 percent in U.S. dollars and 9 percent in local currency. Consulting and outsourcing revenues both grew by double digits in U.S. dollars for the third consecutive quarter and were also quarterly records.

“We believe that our competitive differentiation and unique market position will continue to drive the growth of our business. The special ability to serve clients from idea through design, implementation and operation continues to show its power in delivering value to our clients — and our shareholders.”

GAAP diluted earnings per share were $0.54, compared with $0.56 in the third quarter of fiscal 2006. EPS of $0.54 represent an increase of 8 percent over adjusted EPS of $0.50 in the third quarter last year, which exclude the benefit from a $58 million reduction in reorganization liabilities for that quarter described below under Financial Review.

The company has raised its outlook for earnings per share for the full fiscal year 2007 to a range of $1.94 to $1.96 from the previous range of $1.88 to $1.93 provided during its second-quarter earnings announcement in March.

New bookings for the third quarter of fiscal 2007 rose to $6.22 billion, with outsourcing bookings of $2.72 billion and record consulting bookings of $3.50 billion.

Operating income was $682 million (13.4 percent of net revenues), compared with $690 million (15.7 percent of net revenues) in the third quarter last year on a GAAP basis and $632 million (14.3 percent of net revenues) on an adjusted basis, described below under Financial Review.

William D. Green, Accentures chairman and CEO, said, We are pleased to report another excellent quarter. Our strong performance and continued business momentum reflect the strength of our global franchise and our success in helping clients become high-performance businesses. We grew revenues in both U.S. dollars and local currency and achieved double-digit growth in both consulting and outsourcing. Moreover, new bookings of $6.2 billion, including our third straight quarter of record consulting bookings, demonstrate the strong and growing demand for our services. In addition, we are on the path to expand operating margin and achieve record EPS for the full fiscal year.

We believe that our competitive differentiation and unique market position will continue to drive the growth of our business. The special ability to serve clients from idea through design, implementation and operation continues to show its power in delivering value to our clients and our shareholders.

Financial Review

In addition to providing year-over-year GAAP comparisons, Accenture is presenting results for the third quarter of fiscal 2006 on an adjusted basis, excluding the benefit from a $58 million reduction in reorganization liabilities in that quarter, where relevant. The company believes that adjusting for this item, which affects the comparability of results between periods, provides an additional meaningful comparison.

Revenues before reimbursements (net revenues) for the third quarter of fiscal 2007 were $5.08 billion, compared with $4.41 billion for the third quarter of fiscal 2006, an increase of 15 percent in U.S. dollars and 9 percent in local currency.

  • Consulting net revenues were $3.08 billion, an increase of 16 percent in U.S. dollars and 9 percent in local currency over the third quarter last year.
  • Outsourcing net revenues were $2.00 billion, an increase of 15 percent in U.S. dollars and 9 percent in local currency over the same period last year.

GAAP diluted EPS for the third quarter of fiscal 2007 were $0.54, compared with $0.56 in the third quarter last year on a GAAP basis and $0.50 on an adjusted basis, which excludes a $0.06 benefit from the reduction in reorganization liabilities mentioned above.

GAAP operating income was $682 million, or 13.4 percent of net revenues, compared with $690 million, or 15.7 percent of net revenues, in the third quarter last year. On an adjusted basis, operating income for the third quarter last year was $632 million, or 14.3 percent of net revenues.

Gross margin (gross profit as a percentage of net revenues) was 31.7 percent, compared with 33.0 percent in the third quarter last year.

Selling, general and administrative expenses were $921 million, or 18.1 percent of net revenues, compared with $816 million, or 18.5 percent of net revenues, in the third quarter last year.

The companys effective tax rate for the third quarter of fiscal 2007 was 33.3 percent, which includes the effect of the reduction in the year-to-date tax rate from 34.9 percent to 34.3 percent as a result of changes in the forecasted geographic mix of income. The year-to-date tax expense also includes a $21 million benefit recorded as a discrete item in the second quarter of fiscal 2007, which reduced the year-to date effective tax rate by 1.1 percentage points, to 33.2 percent.

GAAP income before minority interest was $473 million, compared with $499 million on a GAAP basis and $445 million on an adjusted basis in the third quarter last year.

For the three months ended May 31, 2007, operating cash flow was $978 million; property and equipment additions were $82 million; and free cash flow, defined as operating cash flow net of property and equipment additions, was $896 million.

Accentures total cash balance at May 31, 2007, was $3.09 billion, compared with $3.07 billion at Aug. 31, 2006. Cash combined with $352 million of fixed-income securities classified as investments on the companys balance sheet was $3.45 billion, compared with $3.53 billion at Aug. 31, 2006. Total debt at May 31, 2007, was $28 million.

New Bookings

New bookings for the third quarter of fiscal 2007 were $6.22 billion.

  • Consulting bookings were $3.50 billion, a new quarterly record.
  • Outsourcing bookings were $2.72 billion.

Net Revenues by Operating Group

Net revenues for Accentures five operating groups were as follows:

  • Communications & High Tech: $1.201 billion, compared with $1.079 billion for the third quarter of fiscal 2006, an increase of 11 percent in U.S. dollars and 5 percent in local currency.
  • Financial Services: $1.108 billion, compared with $922 million for the same period last year, an increase of 20 percent in U.S. dollars and 12 percent in local currency.
  • Government: $638 million, compared with $599 million for the year-ago period, an increase of 7 percent in U.S. dollars and 2 percent in local currency.
  • Products: $1.280 billion, compared with $1.117 billion for the year-ago period, an increase of 15 percent in U.S. dollars and 9 percent in local currency.
  • Resources: $850 million, compared with $687 million for the same period last year, an increase of 24 percent in U.S. dollars and 18 percent in local currency.

Net Revenues by Geographic Region

Net revenues by geographic region were as follows:

  • Americas: $2.157 billion, compared with $2.018 billion for the third quarter of fiscal 2006, an increase of 7 percent in U.S. dollars and 6 percent in local currency.
  • Europe, Middle East and Africa (EMEA): $2.468 billion, compared with $2.073 billion for the third quarter of fiscal 2006, an increase of 19 percent in U.S. dollars and 8 percent in local currency.
  • Asia Pacific: $457 million, compared with $317 million for the year-ago period, an increase of 44 percent in U.S. dollars and 37 percent in local currency.

Share Repurchase Activity

During the third quarter of fiscal 2007, Accenture repurchased or redeemed 24.1 million shares for a total of $835 million, which includes $558 million for 16.9 million shares repurchased or redeemed at a discount. As previously announced, in March of 2007 the companys board of directors approved $1.5 billion in additional share repurchase authority, bringing Accentures total remaining share repurchase authority at May 31, 2007, to approximately $2.0 billion.

Business Outlook

Fourth Quarter Fiscal 2007

Accenture expects net revenues for the fourth quarter of fiscal 2007 to be in the range of $4.8 billion to $5.0 billion.

Fiscal Year 2007

For the full fiscal year 2007, Accenture now expects net revenue growth to be close to the top of its previously communicated range of 9 percent to 12 percent in local currency. The company has raised its outlook for fiscal 2007 GAAP diluted EPS to a range of $1.94 to $1.96, up from its previously expected range of $1.88 to $1.93.

The company now expects operating cash flow to be $2.2 billion to $2.4 billion; property and equipment additions to be $335 million; and free cash flow to be in the range of $1.9 billion to $2.1 billion. The company now expects its annual effective tax rate to be in the range of 33 percent to 35 percent. Accenture continues to target new bookings for fiscal 2007 in the range of $22 billion to $24 billion.

Conference Call and Webcast Details

Accenture will host a conference call at 4:30 p.m. EDT today to discuss its third-quarter 2007 financial results. To participate, please dial +1 (800) 230-1074 (+1 (612) 288-0329 outside the United States, Puerto Rico and Canada) approximately 15 minutes before the scheduled start of the call. The conference call will also be accessible live on the Investor Relations section of the Accenture Web site at www.accenture.com.

A replay and podcast of the conference call will be available online at www.accenture.com for approximately two weeks beginning at 9:45 p.m. EDT Thursday, June 28. The replay will also be available via telephone by dialing +1 (800) 475-6701 (+1 (320) 365-3844 outside the United States, Puerto Rico and Canada) and entering access code 876610 from 9:45 p.m. EDT Thursday, June 28 through 11:59 p.m. EDT Thursday, July 12, 2007.

About Accenture

Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills, and technologies to help clients improve their performance. With more than 158,000 people in 49 countries, the company generated net revenues of US$16.65 billion for the fiscal year ended Aug. 31, 2006. Its home page is www.accenture.com.

Non-GAAP Financial Information

This press release includes certain non-GAAP financial information as defined by Securities and Exchange Commission Regulation G. Pursuant to the requirements of this regulation, reconciliations of this non-GAAP financial information to Accentures financial statements as prepared under generally accepted accounting principles (GAAP) are included in this press release. Accentures management believes providing investors with this information gives additional insights into Accentures results of operations. While Accentures management believes that these non-GAAP financial measures are useful in evaluating Accentures operations, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP.

Forward-Looking Statements

Except for the historical information and discussions contained herein, statements in this news release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied. These include, without limitation, risks that: our business could be negatively affected if we cannot expand and develop our services and solutions in response to changes in technology and client demand; the management consulting, systems integration and technology and outsourcing markets are highly competitive and we might not be able to compete effectively; our business could be negatively affected by economic and political conditions and the effects of these conditions on our clients business and levels of business activity; our work with government clients exposes us to additional risks in the government contracting process; clients may not be satisfied with our services; our business could be negatively affected by legal liability that results from our providing solutions or services; our results could be adversely affected if our clients terminate their contracts with us on short notice; our outsourcing services subject us to operational and financial risk; liabilities could arise if our subcontractors or other third parties cannot deliver their project contributions on time or at all; our results of operations may be adversely affected by the type and level of technology spending by our clients; our profitability may suffer if we are not able to maintain favorable pricing rates and utilization rates, if we cannot control our costs, or if we cannot anticipate the cost and complexity of performing our work; our global operations are subject to complex risks, some of which might be beyond our control; our growth and our ability to compete may be adversely affected if we cannot attract, retain and motivate our employees or efficiently utilize their skills; our business may be adversely affected if we cannot manage the organizational challenges associated with the size and expansion of our company; tax legislation or negative publicity related to Bermuda companies could adversely affect us; the share price of Accenture Ltd Class A common shares could be adversely affected by sales, or the anticipation of future sales, of Class A common shares held by our current and former employees; as well as the risks, uncertainties and other factors discussed under the Risk Factors heading in our most recent annual report on Form 10-K and other documents filed with or furnished to the Securities and Exchange Commission. Statements in this press release speak only as of the date they were made, and Accenture undertakes no duty to update any forward-looking statements made in this news release or to conform such statements to actual results or changes in Accentures expectations.

ACCENTURE LTD
 
CONSOLIDATED INCOME STATEMENTS
 
(In thousands of U.S. dollars, except share and per share data)
(Unaudited)
 
Three Months Ended May 31, Nine Months Ended May 31,
2007  % of Net Revenues 2006  % of Net Revenues 2007  % of Net Revenues 2006  % of Net Revenues
REVENUES:

Revenues before reimbursements (Net revenues)

$ 5,081,804  100% $ 4,408,069  100% $ 14,585,730  100% $ 12,680,339  100%
Reimbursements   461,880    397,258    1,293,666    1,159,116 
Revenues 5,543,684  4,805,327  15,879,396  13,839,455 
 
OPERATING EXPENSES:
Cost of services:

Cost of services before reimbursable expenses

3,471,962  68.3% 2,954,184  67.0% 10,138,578  69.5% 9,037,354  71.3%
Reimbursable expenses   461,880    397,258    1,293,666    1,159,116 
Cost of services 3,933,842  3,351,442  11,432,244  10,196,470 
Sales and marketing 499,529  9.8% 453,709  10.3% 1,370,752  9.4% 1,255,859  9.9%
General and administrative costs 421,946  8.3% 362,051  8.2% 1,206,654  8.3% 1,101,164  8.7%
Reorganization costs (benefits), net   6,838    (51,999)   19,233    (54,030)
Total operating expenses   4,862,155    4,115,203    14,028,883    12,499,463 
 
OPERATING INCOME 681,529  13.4% 690,124  15.7% 1,850,513  12.7% 1,339,992  10.6%
 
Gain on investments, net 10,146  15  13,033  3,245 
Interest income 40,641  31,571  111,896  86,505 
Interest expense (6,841) (4,852) (18,825) (14,095)
Other expense   (16,090)   (4,971)   (21,989)   (18,113)
 

INCOME BEFORE INCOME TAXES

709,385  14.0% 711,887  16.1% 1,934,628  13.3% 1,397,534  11.0%
 
Provision for income taxes   235,968    213,088    642,818    466,777 
 

INCOME BEFORE MINORITY INTEREST

473,417  9.3% 498,799  11.3% 1,291,810  8.9% 930,757  7.3%
 

Minority interest in Accenture SCA and Accenture Canada Holdings Inc.

(121,925) (153,843) (349,049) (296,633)
Minority interest other (1)   (6,092)   (2,692)   (16,407)   (7,240)
 
NET INCOME $ 345,400  6.8% $ 342,264  7.8% $ 926,354  6.4% $ 626,884  4.9%
 

CALCULATION OF EARNINGS PER SHARE:

Net income $ 345,400  $ 342,264  $ 926,354  $ 626,884 

Minority interest in Accenture SCA and Accenture Canada Holdings Inc. (2)

  121,925    153,843    349,049    296,633 

Net income for diluted earnings per share calculation

$ 467,325  $ 496,107  $ 1,275,403  $ 923,517 
 
EARNINGS PER SHARE:
- Basic $ 0.57  $ 0.58  $ 1.54  $ 1.07 
- Diluted $ 0.54  $ 0.56  $ 1.47  $ 1.03 
 
WEIGHTED AVERAGE SHARES:
- Basic 607,421,151  589,933,994  603,403,840  587,424,108 
- Diluted 859,179,215  887,347,119  866,835,185  898,546,621 
 
Cash dividends per share $ $ $ 0.35  $ 0.30 
 
 
(1) Minority interest other is comprised primarily of minority interest attributable to the minority shareholders of Avanade, Inc.

(2) Diluted earnings per share assumes the redemption and exchange of all Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares, respectively, for Accenture Ltd Class A common shares on a one-for-one basis.

ACCENTURE LTD
 
RECONCILIATION OF CONSOLIDATED INCOME STATEMENT, AS REPORTED (GAAP),
TO CONSOLIDATED INCOME STATEMENT ON AN ADJUSTED BASIS (NON-GAAP)
 
For the Three Months Ended May 31, 2006
(In thousands of U.S. dollars, except share and per share data)
(Unaudited)
 
As Reported

(GAAP)

Adjustments Adjusted

(Non-GAAP)

% of Net

Revenues

REVENUES:
Revenues before reimbursements (Net revenues) $ 4,408,069  $ $ 4,408,069  100%
Reimbursements   397,258      397,258 
Revenues 4,805,327  4,805,327 
 
OPERATING EXPENSES:
Cost of services:
Cost of services before reimbursable expenses 2,954,184  2,954,184  67.0%
Reimbursable expenses   397,258      397,258 
Cost of services 3,351,442  3,351,442 
Sales and marketing 453,709  453,709  10.3%
General and administrative costs 362,051  362,051  8.2%
Reorganization (benefits) costs, net   (51,999)   57,683  (1)   5,684 
 
Total operating expenses   4,115,203    57,683    4,172,886 
 
OPERATING INCOME 690,124  (57,683) 632,441  14.3%
 
Gain on investments, net 15  15 
Interest income 31,571  31,571 
Interest expense (4,852) (4,852)
Other expense   (4,971)     (4,971)
 
INCOME BEFORE INCOME TAXES 711,887  (57,683) 654,204  14.8%
 
Provision for income taxes   213,088    (3,574) (1)   209,514 
 
INCOME BEFORE MINORITY INTEREST 498,799  (54,109) 444,690  10.1%
 

Minority interest in Accenture SCA and Accenture Canada Holdings Inc.

(153,843) 16,779  (137,064)
Minority interest other (2)   (2,692)     (2,692)
 
NET INCOME $ 342,264  $ (37,330) $ 304,934  6.9%
 
CALCULATION OF EARNINGS PER SHARE:
Net income $ 342,264  $ 304,934 

Minority interest in Accenture SCA and Accenture Canada Holdings Inc. (3)

  153,843    137,064 
Net income for diluted earnings per share calculation $ 496,107  $ 441,998 
 
DILUTED EARNINGS PER SHARE $ 0.56  $ 0.50 
 
DILUTED WEIGHTED AVERAGE SHARES 887,347,119  887,347,119 
 
(1) Adjustment represents reorganization benefits recorded during the third quarter less $3,574 in related tax impact.
(2) Minority interest other is comprised primarily of minority interest attributable to the minority shareholders of Avanade, Inc.

(3) Diluted earnings per share assumes the redemption and exchange of all Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares, respectively, for Accenture Ltd Class A common shares on a one-for-one basis.

ACCENTURE LTD
 
RECONCILIATION OF CONSOLIDATED INCOME STATEMENT, AS REPORTED (GAAP),
TO CONSOLIDATED INCOME STATEMENT ON AN ADJUSTED BASIS (NON-GAAP)
 
For the Nine Months Ended May 31, 2006
(In thousands of U.S. dollars, except share and per share data)
(Unaudited)
 
As Reported

(GAAP)

Adjustments Adjusted

(Non-GAAP)

% of Net

Revenues

REVENUES:
Revenues before reimbursements (Net revenues) $ 12,680,339  $ $ 12,680,339  100%
Reimbursements   1,159,116      1,159,116 
Revenues 13,839,455  13,839,455 
 
OPERATING EXPENSES:
Cost of services:
Cost of services before reimbursable expenses 9,037,354  (370,000) (1) 8,667,354  68.4%
Reimbursable expenses   1,159,116      1,159,116 
Cost of services 10,196,470  (370,000) 9,826,470 
Sales and marketing 1,255,859  20,000  (1) 1,275,859  10.1%
General and administrative costs 1,101,164  8,000  (1) 1,109,164  8.7%
Reorganization (benefits) costs, net   (54,030)   72,321  (2)   18,291 
 
Total operating expenses   12,499,463    (269,679)   12,229,784 
 
OPERATING INCOME 1,339,992  269,679  1,609,671  12.7%
 
Gain on investments, net 3,245  3,245 
Interest income 86,505  86,505 
Interest expense (14,095) (14,095)
Other expense   (18,113)     (18,113)
 
INCOME BEFORE INCOME TAXES 1,397,534  269,679  1,667,213  13.1%
 
Provision for income taxes   466,777    97,974 

(1)(2)

  564,751 
 
INCOME BEFORE MINORITY INTEREST 930,757  171,705  1,102,462  8.7%
 
Minority interest in Accenture SCA and

Accenture Canada Holdings Inc.

(296,633) (55,263) (351,896)
Minority interest other (3)   (7,240)     (7,240)
 
NET INCOME $ 626,884  $ 116,442  $ 743,326  5.9%
 
CALCULATION OF EARNINGS PER SHARE:
Net income $ 626,884  $ 743,326 

Minority interest in Accenture SCA and Accenture Canada Holdings Inc. (4)

  296,633    351,896 
Net income for diluted earnings per share calculation $ 923,517  $ 1,095,222 
 
DILUTED EARNINGS PER SHARE $ 1.03  $ 1.22 
 
DILUTED WEIGHTED AVERAGE SHARES 898,546,621  898,546,621 
 
(1) Represents the net National Health Service (NHS) adjustments of $342,000 less $105,000 in related tax benefit.
(2) Adjustment represents reorganization benefits recorded during the first, second and third quarters less $7,026 in related tax impact.
(3) Minority interest other is comprised primarily of minority interest attributable to the minority shareholders of Avanade, Inc.

(4) Diluted earnings per share assumes the redemption and exchange of all Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares, respectively, for Accenture Ltd Class A common shares on a one-for-one basis.

ACCENTURE LTD
 
SUMMARY OF REVENUES
(In thousands of U.S. dollars)
(Unaudited)
 
Three Months Ended

Percent

Increase US$

Percent

Increase

Local Currency

Percent of

Total Fiscal 2007

Net Revenues

May 31, 2007 May 31, 2006
OPERATING GROUPS
Communications & High Tech $ 1,200,761  $ 1,079,220  11% 5% 24%
Financial Services 1,107,506  921,676  20% 12% 22%
Government 638,058  598,842  7% 2% 12%
Products 1,279,838  1,116,766  15% 9% 25%
Resources 849,673  687,412  24% 18% 17%
Other   5,968    4,153  n/m  n/m   
TOTAL Net Revenues 5,081,804  4,408,069  15% 9% 100%
Reimbursements   461,880    397,258  16%
TOTAL REVENUES $ 5,543,684  $ 4,805,327  15%
 
GEOGRAPHY
Americas $ 2,157,054  $ 2,018,417  7% 6% 42%
EMEA 2,467,683  2,073,050  19% 8% 49%
Asia Pacific   457,067    316,602  44% 37% 9%
TOTAL Net Revenues $ 5,081,804  $ 4,408,069  15% 9% 100%
 
TYPE OF WORK
Consulting $ 3,075,681  $ 2,656,667  16% 9% 61%
Outsourcing   2,006,123    1,751,402  15% 9% 39%
TOTAL Net Revenues $ 5,081,804  $ 4,408,069  15% 9% 100%
 
Nine Months Ended

Percent

Increase US$

Percent

Increase

Local Currency

Percent of

Total Fiscal 2007

Net Revenues

May 31, 2007 May 31, 2006
OPERATING GROUPS
Communications & High Tech $ 3,383,315  $ 3,152,853  7% 3% 23%
Financial Services 3,225,420  2,609,910  24% 17% 22%
Government 1,920,950  1,794,648  7% 4% 13%
Products 3,639,600  3,138,006  16% 11% 25%
Resources 2,400,083  1,976,764  21% 17% 17%
Other   16,362    8,158  n/m  n/m   
TOTAL Net Revenues 14,585,730  12,680,339  15% 10% 100%
Reimbursements   1,293,666    1,159,116  12%
TOTAL REVENUES $ 15,879,396  $ 13,839,455  15%
 
GEOGRAPHY
Americas $ 6,290,016  $ 5,771,674  9% 8% 43%
EMEA 7,104,116  5,998,177  18% 10% 49%
Asia Pacific   1,191,598    910,488  31% 27% 8%
TOTAL Net Revenues $ 14,585,730  $ 12,680,339  15% 10% 100%
 
TYPE OF WORK
Consulting $ 8,818,641  $ 7,698,682  15% 10% 60%
Outsourcing   5,767,089    4,981,657  16% 11% 40%
TOTAL Net Revenues $ 14,585,730  $ 12,680,339  15% 10% 100%
 
n/m = not meaningful
ACCENTURE LTD
 
OPERATING INCOME BY OPERATING GROUP (OG)
 
For the Three Months Ended May 31, 2007 and 2006
(In thousands of U.S. dollars)
(Unaudited)
 
Operating Income as Reported (GAAP)
2007  2006 
OPERATING GROUPS Operating Income Percent of OG Net Revenues Operating Income

 

Percent of OG Net Revenues

Percent Increase (Decrease)
Communications & High Tech $ 168,021  14% $ 173,516  16% (3%)
Financial Services 106,144  10% 125,542  14% (15%)
Government 74,408  12% 66,136  11% 13%
Products 192,813  15% 229,951  21% (16%)
Resources   140,143  16%   94,979  14% 48%
Total $ 681,529  13.4% $ 690,124  15.7% (1%)
 
FY07 Operating Income as Reported (GAAP) compared to
FY06 Operating Income Excluding Reorganization Benefits (Non-GAAP)
2007  2006 

Operating Income (as Reported)

Percent of OG Net Revenues

Reorg. Benefits (1)

Operating Income Adjusted for Reorg. Benefits

Percent of OG Net Revenues

Percent Increase (Decrease)
Communications & High Tech $ 168,021  14% $ 13,710  $ 159,806  15% 5%
Financial Services 106,144  10% 11,847  113,695  12% (7%)
Government 74,408  12% 8,797  57,339  10% 30%
Products 192,813  15% 14,141  215,810  19% (11%)
Resources   140,143  16%   9,188    85,791  12% 63%
Total $ 681,529  13.4% $ 57,683  $ 632,441  14.3% 8%
 

(1) Represents reorganization benefits related to certain reorganization liabilities established in connection with Accentures transition to a corporate structure in 2001, which are included in Reorganization costs (benefits), net on the Consolidated Income Statement.

ACCENTURE LTD
 
OPERATING INCOME (LOSS) BY OPERATING GROUP (OG)
 
For the Nine Months Ended May 31, 2007 and 2006
(In thousands of U.S. dollars)
(Unaudited)
 
Operating Income (Loss) as Reported (GAAP)
2007 

 

2006 

OPERATING GROUPS Operating Income Percent of OG Net Revenues Operating Income (Loss) Percent of OG Net Revenues Percent Increase (Decrease)
Communications & High Tech $ 416,022  12% $ 523,310  17% (21%)
Financial Services 343,845  11% 309,477  12% 11%
Government 195,399  10% (8,826) (1) 0% n/m 
Products 540,223  15% 265,006  (1) 8% n/m 
Resources   355,024  15%   251,025  13% 41%
Total $ 1,850,513  12.7% $ 1,339,992  10.6% 38%
 
FY07 Operating Income as Reported (GAAP) compared to
FY06 Operating Income (Loss) Excluding Reorganization Benefits (Non-GAAP)
2007  2006 
OPERATING GROUPS Operating Income (as Reported) Percent of OG Net Revenues Reorg. Benefits (2) Operating Income (Loss) Adjusted for Reorg. Benefits Percent of OG Net Revenues

Percent Increase (Decrease)

Communications & High Tech $ 416,022  12% $ 17,183  $ 506,127  16% (18%)
Financial Services 343,845  11% 14,901  294,576  11% 17%
Government 195,399  10% 10,984  (19,810) (1) (1%) n/m 
Products 540,223  15% 17,742  247,264  (1) 8% n/m 
Resources   355,024  15%   11,511    239,514  12% 48%
Total $ 1,850,513  12.7% $ 72,321  $ 1,267,671  10.0% 46%
 
n/m = not meaningful
(1) Includes the impact of the second-quarter National Health Service (NHS) adjustments.

(2) Represents reorganization benefits related to certain reorganization liabilities established in connection with Accentures transition to a corporate structure in 2001, which are included in Reorganization costs (benefits), net on the Consolidated Income Statement.

ACCENTURE LTD
 
CONSOLIDATED BALANCE SHEETS
 
May 31, 2007 and August 31, 2006
(In thousands of U.S. dollars)
 
May 31, 2007

August 31, 2006

(Unaudited)
ASSETS
 
CURRENT ASSETS:
Cash and cash equivalents $ 3,093,634  $ 3,066,988 
Short-term investments 284,410  352,951 
Receivables from clients, net 2,378,134  1,916,450 
Unbilled services 1,579,636  1,350,211 
Other current assets   703,875    667,221 
 
Total current assets   8,039,689    7,353,821 
 
NON-CURRENT ASSETS:
Unbilled services 62,309  105,081 
Investments 82,519  125,119 
Property and equipment, net 748,185  727,692 
Other non-current assets   1,116,314    1,106,367 
 
Total non-current assets   2,009,327    2,064,259 
 
TOTAL ASSETS $ 10,049,016  $ 9,418,080 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
CURRENT LIABILITIES:
Short-term debt $ 25,006  $ 24,792 
Accounts payable 863,646  856,087 
Deferred revenues 1,769,310  1,511,259 
Accrued payroll and related benefits 2,104,543  1,693,796 
Other accrued liabilities   1,904,981    1,730,548 
 
Total current liabilities   6,667,486    5,816,482 
 
NON-CURRENT LIABILITIES:
Long-term debt 3,226  27,065 
Other non-current liabilities   784,737    812,400 
 
Total non-current liabilities   787,963    839,465 
 
MINORITY INTEREST 715,505  867,878 
 
SHAREHOLDERS' EQUITY   1,878,062    1,894,255 
 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 10,049,016  $ 9,418,080 

Contacts

Accenture
Roxanne Taylor, +1-917-452-5106
roxanne.taylor@accenture.com

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