Accenture plc (ACN)
Q3 2011 Earnings Call
June 23, 2011 4:30 pm ET
Pamela Craig - Chief Financial Officer
KC McClure -
Pierre Nanterme - Chief Executive Officer and Director
Joseph Foresi - Janney Montgomery Scott LLC
James Friedman - Susquehanna Financial Group, LLLP
George Price - BB&T Capital Markets
Julio Quinteros - Goldman Sachs Group Inc.
Nathan Rozof - Morgan Stanley
David Koning - Robert W. Baird & Co. Incorporated
Arvind Ramnani - UBS Investment Bank
Tien-Tsin Huang - JP Morgan Chase & Co
Rod Bourgeois - Sanford C. Bernstein & Co., Inc.
Darrin Peller - Barclays Capital
Ashwin Shirvaikar - Citigroup Inc
David Grossman - Stifel, Nicolaus & Co., Inc.
Previous Statements by ACN
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Thank you, Michelle, and thanks, everyone, for joining us today on our third quarter fiscal 2011 earnings announcement. As Michelle just mentioned, I'm KC McClure, Managing Director of Investor Relations. With me today are Pierre Nanterme, our Chief Executive Officer; and Pamela Craig, our Chief Financial Officer.
We hope you've had an opportunity to review the news release we issued a short time ago. Let me quickly outline the agenda for today's call. Pierre will begin with an overview of our results. Pam will take you through the financial details, including the income statement and balance sheet, along with some key operational metrics for the third quarter. Pierre will then provide a brief update on our market positioning and progress against our growth strategy. Pam will then provide our business outlook for the fourth quarter and full fiscal year 2011, and then we will take your questions before Pierre provides a wrap-up at the end of the call.
As a reminder, when we discuss revenues during today's call, we're talking about revenues before reimbursements or net revenues. Some of the matters we'll discuss in this call are forward-looking, and you should keep in mind that these forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, general economic conditions and those factors set forth in today's news release and discussed under the Risk Factors section of our annual report on Form 10-K and other SEC filings.
During our call today, we will reference certain non-GAAP financial measures which we believe provide useful information for investors. We include reconciliations of those measures where appropriate to GAAP in our news release or on the Investor Relations section of our website at accenture.com. As always, Accenture assumes no obligation to update the information presented on this conference call.
Now let me turn the call over to Pierre.
Thank you, KC, and thanks, everyone, for joining us. I'm very pleased to tell you about our excellent third quarter results, which demonstrate the strong momentum we have seen in our business. Here are a few highlights. We generated outstanding new bookings of $7.1 billion, our highest in 11 quarters. Consulting bookings were $3.7 billion, and outsourcing bookings were $3.4 billion. We grew revenues 15% in local currency to more than $6.7 billion, our highest quarterly revenues ever.
Earnings per share were $0.93, also a quarterly record. This represents an increase of $0.20 or 27% over Q3 last year. We grew operating income 18% to $949 million and delivered operating margin of 14.1%.
We continue to have a very strong balance sheet, with a cash balance of $5.3 billion, and we continued to return cash to shareholders through share repurchases and the payment of our semiannual dividends.
We are particularly pleased that our growth is broad-based across industries, growth platforms and geographies, both mature and emerging. And given our strong year-to-date performance, we have raised our outlook for revenues, EPS and cash flow for the full fiscal year. Now I will turn the call over to Pam, who will provide more detail on the numbers.
Thank you, Pierre, and thanks to all of you for listening today. I am pleased to tell you more about Accenture's fiscal year 2011 third quarter financial results. We delivered very strong quarterly revenues, hitting a new record. In fact, each of our 5 operating groups hit a new quarterly high driven by, as Pierre just said, broad-based demand. We also achieved record high EPS results for the quarter as we continue to drive and sustain profitable growth.
Now let's get to the numbers. Unless I state otherwise, all figures are U.S. GAAP except the items that are not part of the financial statements or the recalculations. New bookings for the quarter were $7.1 billion and reflect the positive 6% foreign exchange impact compared with new bookings in the third quarter last year. Consulting bookings were $3.7 billion, and outsourcing bookings were $3.4 billion.
Let me give you some details first in consulting. In Management Consulting, clients are hiring us to help them target and action opportunities to deliver value in their operations, to reduce their costs, to grow their top lines through sales and services differentiation, to implement improved compliance and risk management and to integrate operations they acquire.
In Technology Consulting, our unique position in the technology ecosystem continues to serve us well. Clients value our independence and track record. We are helping our clients to rationalize their infrastructures through virtualization and consolidation and to build IT strategies for transformation and streamlining of their global operations.