|(in million of Euros)||H1 2013||H1 2014||Change|
as % of revenues
as % of revenues
Profit attributable to shareholders
as % of revenues
|Net cash and cash equivalents at the end of the period||272||205|
|Organic free cash flow**||(313)||(148)|
* +2.6% on like-for-like basis
Like-for-like growth in revenues breaks down as follows:
- By business*, Consulting Services (4% of Group revenues) contracted by 4.7%. Local Professional Services (Sogeti) (15% of Group revenues) grew slightly by 0.6% (+1.1% in Q2). Application Services (56% of Group revenues) grew 2.2% in H1 (+2.5% in Q2) supported by a good momentum in SMAC and application maintenance. Other Managed Services (24% of Group revenues) showed the best increase with 6.5% in H1 (+7.2% in Q2) fueled by growth in BPO and Infrastructure Services.
- by region, the emerging countries of Asia Pacific and Latin America reported strong growth (+9.1%). Activity in North America remains strong with a revenue growth of 6.1% in H1 (+7.9% in Q2). With an increase of revenues of 3.3%, the United Kingdom and Ireland region is showing the dynamism of the commercial sector. Activity in France continued to expand by 1.5% in H1 (+1.9% in Q2) in spite of a slow environment. Benelux reported a 2.1% fall in revenues in H1, with the decrease limited to 1.2% in Q2; aiming for a stable activity in the second-half. The rest of Europe is flat (-0.1%) with still a difficult environment in Spain.
Bookings totaled €5 653 million in H1 2014, a growth 20% compared to the same period in 2013 and an overall book to bill of 1.11.
The operating margin of the Group for H1 2014 reached €402 million, or 7.9% of revenues, up 0.6 points on H1 2013.
Profit for the period attributable to shareholders is €240 million, compared with €176 million for H1 2013, an increase of 36%.
Organic free cash flow is -€148 million for H1 2014 compared with -€313 million for H1 2013. Net cash and cash equivalents total €205 million on June 30, 2014.
At the end of H1 2014, the total headcount of the Group was 138,809 including 1,842 employees from the acquisition of Euriware, which was completed on May 7, 2014. Offshore employees totaled 62,909, up 16% on June 30, 2013 (including 51,877 in India) and represented 45% of the Group headcount, up 3 points on June 30, 2013.
H1 strong performance supports the Group’s annual guidance, it confirms its objectives for 2014 of an organic revenue growth of 2% to 4% and an operating margin rate between 8.8% and 9.0%. Organic free cash flow is expected to exceed €500 million.
For Paul Hermelin, Chairman and CEO of the Capgemini Group: “In spite of slow economic growth in our key markets in Continental Europe, we continue to execute our strategy and meet our commitments; reporting growth in H1 in line with our objectives, driven by the momentum of our operations in North America and emerging countries, and a strong improvement in profits. Our strategy to combine competitiveness and innovation is bearing fruit.”
The Board of Directors has also decided, pursuant to resolutions 30 and 31 voted in the last Shareholders General Assembly, to launch a new capital increase reserved for employees for a maximum of 5 million shares, along with the end of the 2009 share ownership plan; the transaction should be completed before the end of 2014. It also authorized a new share buyback program of €80 million in order to neutralize the future dilution generated by the various equity-based instruments granted to employees.
*Note on the definition of the businesses:
The growing demand of customers, to integrate within a single contract maintenance services and application development, has led the Group to revise the presentation of segment information by business. The distinction between Technology Services, including application development, and Outsourcing which includes the maintenance activity, has therefore become artificial.
Accordingly, effective from January 1, 2014, segment reporting by business is presented as follows:
- Consulting Services, which help to enhance the performance of organizations based on in-depth knowledge of client industries and processes (unchanged),
- Local Professional Services, which provide assistance and support to internal IT teams within client companies (unchanged),
- Application Services, which devise, develop, implement and maintain IT applications covering the Group’s system integration and application maintenance activities.
- Other Managed Services, which integrate, manage and/or develop either fully or partially, client’s IT Infrastructure systems (or that of a group of clients), transaction services, on demand services and/or business activities (Business Process Outsourcing, BPO).
Results by region
|Growth vs. H1 2013||Operating margin|
|Published||Like-for-like||H1 2013||H1 2014|
|United Kingdom and Ireland||21.2%||7.0%||3.3%||8.1%||9.9%|
|Rest of Europe||18.1%||-2.1%||-0.1%||6.2%||7.9%|
|Asia Pacific and Latin America||7.7%||-5.7%||9.1%||2.6%||2.7%|
Results by business
|Growth (1) vs. H1 2013||Operating margin|
|H1 2013||H1 2014|
|Local Professional Services (Sogeti)||15.2%||0.6%||9.1%||8.2%|
|Other Managed Services||24.0%||6.5%||6.0%||7.3%|
Key events of H1 2014
- Launch of “Digital Customer Experience”, a new global service line to help organizations digitalize their customer experience
- Strategic partnership with VMWare to jointly develop new business cloud orchestration solutions
- Over €40M contract with Lloyd’s Register to deliver new and enhanced infrastructure and application services
- Acquisition of the French IT Services firm Euriware
- Partnership signed with Areva covering a large outsourcing and systems integration contract for €1 billion over 10 years
- BPO contract with Honeywell for the management of financial and accounting services
- Expansion of our partnership with Cloudera to help organizations accelerate their Big Data initiatives
- Application Services contract with Office Depot
Historical results by business
|Revenue in €M||2012||2013||H1 2013||H1 2014|
|Local Professional Services (Sogeti)||1,528||1,498||755||775|
|Other Managed Services||2,328||2,313||1,118||1,224|
|Operating Margin in % of revenue||2012||2013||H1 2013||H1 2014|
|Local Professional Services (Sogeti)||10.7%||10.6%||9.1%||8.2%|
|Other Managed Services||7.0%||7.1%||6.0%||7.3%|