Accenture Sees Increase In Sales And IncomeAccenture Sees Increase In Sales And Income

IT services and consulting firm Accenture posted a 12% increase in revenue in its fiscal fourth quarter as sales rose from $2.69 billion a year ago to $3.02 billion. Per-share earnings were 25 cents on operating income of $350 million, compared with 8 cents--or $148 million in income--a year ago when the company lost $15 million on investments and took a $111 million charge against earnings for real-estate consolidation.

For the full year, Accenture's revenue rose 2%, from $11.57 billion to $11.82 billion. Per share earnings for fiscal 2003 were $1.05, compared with 56 cents in 2002. Operating income was $1.55 billion, up from $1.39 billion a year ago.

Analysts say Accenture is benefiting from the growing trend among businesses to outsource the operation of departments such as accounting and customer service. "The trend toward business-process outsourcing is very much in their favor," says David Garrity at American Technology Research. In the fourth quarter, Accenture recorded $1.04 billion in outsourcing sales, an increase of 41% compared with a year ago.

However, Accenture's consulting business remains in the doldrums. Fourth-quarter sales were $1.87 billion, virtually unchanged from a year ago. But Garrity says Accenture and other service firms that have strong system-integration businesses should benefit from indications that the software market is picking up. An announcement by ERP vendor SAP that its third-quarter sales held steady is good news for service providers, Garrity says. "The implications for system integrators such as Accenture and BearingPoint are significantly positive."