Capgemini: growth momentum confirmed in Q3 2015
The Capgemini group continues on its momentum with a strong increase in revenues and an organic growth of 1.5%.
Paris, 29 October 2015 – The Capgemini Group achieved revenues of €3,036 million in Q3 2015, up 17.2% at current Group structure and exchange rates compared to the same quarter in 2014. At constant Group structure and exchange rates, organic revenue growth was 1.5%.
For Paul Hermelin, Chairman and CEO of Capgemini Group: "After the strong performance in H1, the Group continues on its momentum with a strong increase in revenues (+17.2%) and an organic growth of 1.5%. Customer demand was mainly driven by innovation, as evidenced by the 21% increase in revenues in SMAC. The Group has successfully launched its "Cloud Choice" offering during this quarter and multiplies new deals in Digital, imposing itself as one of the key partners in this field. The integration of the US firm IGATE, whose acquisition was completed on July 1st, reinforces our status as a market leader with a strong presence in North America, where we now achieve 31% of our revenues, and a Global Production Center network with more than 96,000 employees. Furthermore, the combination of service offerings and capabilities of Capgemini and IGATE has already resulted in new business wins, notably in financial services and in consumer products and retail. This good momentum and our bookings growth in the quarter lead us to confirm our guidance for 2015.”
The Group achieved revenues of €3,036 million in Q3 2015, representing an increase of 17.2% compared to the one published for the third quarter of 2014. The difference between organic and current growth is due to the relative evolution of Group currencies compared to the Euro and the acquisition of IGATE finalized on July 1st 2015. The performance of IGATE is in line with expectations and its integration is on schedule.
TRENDS BY BUSINESS
On a like-for-like basis, Consulting Services (4% of Group revenues) continue to accelerate, with an increase in revenues of 6.7% in Q3 vs. 4.4% in H1. Local Professional Services (Sogeti) (14% of Group revenues) is also slightly improving with growth of 1.4% (against 0.5% in H1). Application Services (60% of sales) which already had strong momentum in H1 with 5.1% growth, continues to support the Group's growth. Revenue growth for the quarter, primarily driven by the acceleration of clients’ investment in digital and cloud projects, reached 8.2%. Other Managed Services (22% of Group revenues) see their activity decrease by 13.7% due to the anticipated decline in revenue of a major contract in the United Kingdom and an unfavorable economic environment in Brazil.
TRENDS BY MAJOR REGION
On a like-for-like basis, North America - now by far the Group's largest region with 31% of revenues - grew by 5.2%, with a positive momentum in Financial Services as well as in CPRDT (Consumer Products, Retail, Distribution and Transportation), and a slowdown in energy and utilities. The UK and Ireland region continues to experience a reduction in revenues (-11.0%) due to the evolution of a major contract mentioned above. France is more dynamic than in H1 with a growth of 2.0% driven by a pick-up in projects business. Benelux, meanwhile, remained virtually stable (+ 0.6%). In the Rest of Europe, growth was 10.4%, accelerating compared to H1, with strength notably in Nordic countries and Germany. In Asia-Pacific and Latin America, growth was limited to 3.7% in Q3 due to the economic environment in Brazil, Asia Pacific, however, maintains a double digit growth.
As of September 30, 2015 Group employees totaled 178,045 people. Offshore leverage, with over 96,000 employees in the Global Production Center network, stands at 54% of the total workforce.
New orders recorded in Q3 2015 amounted to €2,499 million. This represents a 20% increase at constant exchange rates compared to the level recorded in the same period of 2014.
Thanks to the strong performance in Q3, the Group confirms its financial objectives for 2015. The group forecasts 2015 revenue growth of 12%, at current Group structure and exchange rates, and an operating margin rate of 10.3%. Organic free cash flow is expected to exceed €600 million.
- Completion of the acquisition of the US company IGATE on July 1, 2015
- Increase in the Group's majority stake, to above 70%, in its Brazilian subsidiary CPM Braxis, in line with its strategy to strengthen its presence in emerging countries
- 5 year Infrastructure Services contract with Nationwide building society in the UK
- Innovation & Digital:
- Launch of the new global offering "Cloud Choice” services; Microsoft is the first cloud service provider to partner in this program
- Opening of two new “Innovation Labs” in Munich and Mumbai after those of Paris, London, Utrecht, Melbourne, Toulouse and Lille
- Signing of a 5 years Insights and Data deal (based on SAP HANA® platform and SAP® Data Services ™ software) with German insurer Munich Re
- Partnership with the Dutch energy company Eneco focused on digital transformation.
This press release may contain forward-looking statements. Such statements may include projections, estimates, assumptions, statements regarding plans, objectives, intentions and/or expectations with respect to future financial results, events, operations and services and product development, as well as statements, regarding future performance or events. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans”, “projects”, “may”, “would” “should” or the negatives of these terms and similar expressions. Although Cap Gemini’s management currently believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking statements are subject to various risks and uncertainties (including without limitation risks identified in Cap Gemini’s Registration Document available on Cap Gemini’s website), because they relate to future events and depend on future circumstances that may or may not occur and may be different from those anticipated, many of which are difficult to predict and generally beyond the control of Cap Gemini. Actual results and developments may differ materially from those expressed in, implied by or projected by forward-looking statements. Forward-looking statements are not intended to and do not give any assurances or comfort as to future events or results. Other than as required by applicable law, Cap Gemini does not undertake any obligation to update or revise any forward-looking statement.
This press release does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction.
With more than 190,000 people, Capgemini is present in over 40 countries and celebrates its 50th Anniversary year in 2017. A global leader in consulting, technology and outsourcing services, the Group reported global revenues of EUR 12.5 billion in 2016. Together with its clients, Capgemini creates and delivers business, technology and digital solutions that fit their needs, enabling them to achieve innovation and competitiveness. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model.
Learn more about us at www.capgemini.com.
Rightshore® is a trademark belonging to Capgemini.
- Christel LerougeVP, Content, Operations, Influencer Relations at Capgemini
+33 1 47 54 50 71
Christel LerougeVP, Content, Operations, Influencer Relations at Capgemini
+33 1 47 54 50 71
- Vincent BiraudInvestor Relations Contact
+33 1 47 54 50 87
Vincent BiraudInvestor Relations Contact
+33 1 47 54 50 87