Paris, March 15, 2001

The Board of Directors of Cap Gemini S.A., which met on March 14 in Paris and was chaired by Serge Kampf, examined the 2000 definitive and audited financial statements which confirm the provisional indications given on January 25, 2001:

• Group consolidated revenue is 6,931 million euros, that is an increase of 60.8% over that of 1999 (4,310 million euros)
  
  
• operating margin reaches 703 million euros (that is 10.1% of revenue), an increase of 49.9% over that of the previous year (469 million euros)
  
  
• earnings exclusive of minority interests are 431 million euros for 2000 compared to 266 million euros in 1999, that is an identical percentage of 6.2% of revenue for both years
  
  
• diluted earnings per share reach 3.99 euros, showing an improvement of 16% on those of 1999 (3.44 euros), relating to an average number of restated shares of 77.3 million in 1999 and 107.9 million in 2000.

On a pro forma basis, that is including Ernst & Young’s Consulting businesses as from January 1, 1999 instead of the date the merger was approved by the Shareholders Meeting (May 23, 2000):

• revenue reaches 8,471 million euros compared to 7,674 million euros for 1999, that is 10.4% growth (2.8% excluding exchange rate effects)
  
  
• operating margin climbs to 893 million euros, that is 10.5% of revenue, compared to 786 million euros and 10.2% of revenue in 1999, that is an improvement of 0.3 point
  
  
• earnings exclusive of minority interests reach 547 million euros, compared to 436 million euros in 1999, that is an improvement of 25.5%
  
  
• pro forma diluted earnings per share progress by 19.8% to 4.35 euros, compared to 3.63 euros in 1999 (assuming that the shares issued on May 23, 2000 for the acquisition of Ernst & Young’s consulting businesses exist since January 1, 1999).

It should be noted that these results do not take into account the impact of the tax saving which the Group benefits from following the acquisition of Ernst & Young’s North America consulting businesses.  This saving will be used to reduce tax payments to the United States and Canada over fifteen years, thus year by year improving the Group’s cash situation accordingly.  The total possible tax saving is currently estimated at 1,808 million euros.

From an accounting point of view, better visibility on North America profit outlook now makes it possible to assess the tax saving that will probably be used at 698 million euros, the balance having been prudently reserved.  This amount appears on the balance-sheet only, and not in the income statement, on December 31, 2000, contrary to the treatment provisionally chosen in the half-year accounts on June 30, 2000 (for an amount then estimated at 140 million euros):  indeed, it seemed to be best practice not to increase the annual results with such a considerable amount, all the more so since this operation does not give rise to any amortisation charges in the income statement.

The Board of Directors has decided to propose to the Ordinary Shareholders Meeting of May 16, 2001 the distribution of a 2000 dividend of 1.20 euros per share, a 20% increase on the 1999 dividend (1 euro), that is a total amount of 149 million euros for the 124.3 million shares existing on December 31, 2000.

After a successful merger carried out in the space of seven months, the new organisation structure integrates and combines what has so far been the strengths of Ernst & Young Consulting and Cap Gemini.  The new business development and management structure set up should help to unlock the synergies created by a value-creating merger thanks to the excellent strategic fit of the two organisations. As far as the outlook is concerned, the Board notes that the Group is entering 2001 with a solid order-book and an improved staff retention rate, even in regions which had experienced difficult conditions in the first part of 2000 (United States, Great Britain and the Nordic countries).

Of course, the market is still affected by uncertainty and nobody can currently determine the magnitude of the consequences of the economic slowdown in the United States on the global economy and on corporate IT budgets;  however, against such a background and taking into account its strengths, the Group’s objective for this year is still:

• to raise revenue to 9,600 million euros (based on 2000 exchange rates),
  
  
• to maintain and if possible slightly improve its operating margin.

Indeed, whatever the economic developments, Cap Gemini Ernst & Young is well-armed to keep pace with its current momentum:

• strategy and technology still go hand in hand, independent of the economic climate, and the Group benefits from a skill set that closely coincides with market requirements,
  
  
• the Group’s client portfolio is well split between the different economic sectors, and the accent placed on the sector approach in the new organisation helps adapt service offerings to the new developments of each business sector,
  
  
• the Group’s service lines meet the needs of companies in full swing as well as of those clients whose strategy is focused on a rigorous management of their costs and expenditure,
  
  
• company change, needed to adapt to the new net economy and illustrated by the rapid emergence of virtual marketplaces or by the new client relationship management methods, is taking place against a background of growing competition in substantially all markets, forcing companies to work constantly to improve their productivity,
  
  
• on the employment market, the new Group’s reputation and its dedication to the management of its different professions should contribute to employee stability and reinforce its ability to hire the best.

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