NHS cuts into Accenture profit
- By John Moore
- Apr 08, 2005
Problems with deploying systems for the United Kingdom's National Health Service (NHS) cut into Accenture's second-quarter profit margin.
The systems integrator reported second-quarter revenue growth of 15 percent year-over-year, to $3.81 billion. Its government operating group posted growth of 11 percent to $521 million.
However, the company's second operating margin fell to 11.4 percent, compared with 12.6 percent a year ago. Accenture officials partly attributed the decline to delays in deploying systems under its contracts with NHS.
Accenture announced its quarterly results April 7. The company posted earnings of 35 cents per share, a 59 percent boost over the previous year.
Shares of Accenture fell today, following the news. At 3 p.m., Accenture traded at $23.83, down more than 4 percent from the previous day's closing price.
Financial services was Accenture’s fastest growing market segment, expanding at a 33 percent clip.
William Green, Accenture’s chief executive officer, told analysts during a conference call that the company’s contract pipeline remains strong. "We continue to see improvement in the win rate for our work," he said.
The company reported $4.88 billion in new bookings for the quarter. Consulting bookings were up 43 percent compared with the company’s first fiscal quarter. New outsourcing bookings were flat with the previous quarter.
In other news, Accenture officials said they will recruit more than 7,000 employees in the current fiscal year. The company currently employs 27,000 people in the U.S. market and has total headcount of more than 110,000 employees globally.
Moore is a freelance writer based in Syracuse, N.Y.