Accenture reported financial results for the first quarter of fiscal 2020, ended Nov. 30, 2019, with revenues of $11.4 billion, an increase of 7 percent in U.S. dollars and 9 percent in local currency over the same period last year. Diluted earnings per share were $2.09, an increase of 7 percent from the first quarter last year.
Operating income was $1.77 billion, an 8 percent increase over the same period last year, and operating margin was 15.6 percent, an expansion of 20 basis points.
New bookings for the quarter were $10.3 billion, with consulting bookings of $6.0 billion and outsourcing bookings of $4.3 billion.
Julie Sweet, Accenture’s chief executive officer, said, “We are very pleased with our strong first quarter financial results and the continued momentum across our business. With 9 percent revenue growth in local currency, we again gained significant market share. We also delivered strong profitability and cash flow, and returned $1.2 billion in cash to shareholders while continuing to invest significantly in our business. “Our strong, broad-based results across industries and geographic markets reflect the diversity and scale of Accenture’s business around the world. With our unparalleled technology capabilities, deep industry and function expertise, focus on continuous innovation, and incredibly talented people, we are uniquely positioned to continue driving value for our clients and all our stakeholders.”
Financial Review
Revenues for the first quarter of fiscal 2020 were $11.36 billion, compared with $10.61 billion for the first quarter of fiscal 2019, an increase of 7 percent in U.S. dollars and 9 percent in local currency, above the company’s guided range of $10.9 billion to $11.2 billion.
The foreign exchange impact for the quarter was approximately negative 2 percent, consistent with the assumption provided in the company’s fourth-quarter earnings release.
▪ Consulting revenues for the quarter were $6.38 billion, an increase of 7 percent in U.S. dollars and 9 percent in local currency compared with the first quarter of fiscal 2019.
▪ Outsourcing revenues were $4.98 billion, an increase of 7 percent in U.S. dollars and 9 percent in local currency compared with the first quarter of fiscal 2019. Diluted EPS for the quarter were $2.09, compared with $1.96 for the first quarter last year. The $0.13 increase in EPS reflects:
▪ a $0.17 increase from higher revenue and operating results;
▪ a $0.06 increase from higher non-operating income; and
▪ a $0.01 increase from a lower share count; partially offset by
▪ an $0.11 decrease from a higher effective tax rate.
Gross margin (gross profit as a percentage of revenues) for the quarter was 32.1 percent, compared with 31.1 percent for the first quarter last year. Selling, general and administrative (SG&A) expenses for the quarter were $1.88 billion, or 16.6 percent of revenues, compared with $1.67 billion, or 15.7 percent of revenues, for the first quarter last year.
Operating income for the quarter increased 8 percent, to $1.77 billion, or 15.6 percent of revenues, compared with $1.63 billion, or 15.4 percent of revenues, for the first quarter of fiscal 2019.
The company’s effective tax rate for the quarter was 23.6 percent, compared with 19.8 percent for the first quarter last year.
Net income for the quarter was $1.38 billion, a 6 percent increase from $1.29 billion for the first quarter last year.
