Accenture Makes Important Acquisitions In Mobile And Automation

Gartner continues to raise its estimates of worldwide IT spending. Its latest report forecasts 2011 spending to increase 5.6% over the year to $3.6 trillion. The inclusion of handheld tablet devices to the computing hardware category has helped increase the forecast. Worldwide media tablet spending is projected to grow to $29.4 billion in the year from the $9.6 billion reported last year. Computing hardware spending is expected to grow 9.5% over the year to $409 billion followed by 7.6% growth in enterprise software to $255 billion. IT services are projected to grow 5% to $824 billion and telecom services are expected to grow 4.9% to $2.1 trillion. Improved IT enterprise spending is already boosting the financial performance of IT outsourcers.

Accenture’s Financials
Accenture’s (NASDAQ:ACN) Q2 revenues increased 17% over the year to $6.05 billion with consulting revenues up 20% over the year to $3.51 billion and outsourcing revenues up 13% over the year to $2.54 billion. New bookings for the quarter stood at $6.98 billion with $3.80 billion in consulting bookings and $3.18 billion in outsourcing bookings. EPS for the quarter of $0.75 grew 25% over the year. The Street was expecting revenues of $5.73 billion and EPS of $0.71.

During the quarter, Accenture repurchased 3.6 million shares for $177 million.

For the current quarter, the company projects revenues of $6.3 billion to $6.5 billion, compared with the Street’s expectations of $6.07 billion. It expects to end the year with revenue growth of 11% to 14% and EPS of $3.22 to $3.30. The market was looking for EPS of $3.11 for the year.

Accenture’s Operating Metrics
In line with its plans to hire 64,000 people worldwide during the year, the company recorded a net addition of 4,000 employees during the quarter, ending it with a global headcount of 215,000 people. During the quarter, utilization fell to 86% from 87% a quarter ago and 88% a year ago. Accenture’s attrition control measures appear to be working, with quarterly figures improving to 14%, compared with 15% reported a quarter ago and a year ago.

Accenture Expands Delivery Locations
As part of its continued geographic expansion, Accenture recently opened a new analytics innovation center in Barcelona. Spain is already home to more than 10,000 Accenture employees, and the new facility is expected to add another 50 high-skilled jobs by the end of three years. The center will focus on development of sophisticated supply chain analytics solutions for the company’s clients. Accenture boasts of operations in over 200 cities spread across 53 countries.

Accenture’s Acquisitions Continue
Continuing with acquisitions, Accenture added Beijing Genesis Interactive Technology Co., also known as Mogenesis, a Beijing-based embedded software services company that specializes in mobile software outsourcing services and solution licensing for Chinese companies to their portfolio. The acquisition will help Accenture strengthen its embedded software service offerings to device manufacturers in China.

It also acquired Philadelphia-based Knowledge Rules, a provider of Pegasystems’ business process management (BPM) software. Pegasystems is among the fastest-growing software providers in the automation of BPM solutions. Knowledge Rules specialized in delivering assessment and implementation and Pegasystems management services solutions. Through the acquisition, Accenture will be able to increase its capability to implement Pegasystems-based solutions and expand client reach in key U.S. and European markets. The terms of either acquisition were not disclosed.

The stock is trading at $56.55 with a market capitalization of $40.43 billion. Earlier last month, it touched a 52-week high of $56.78.