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Organic Revenue Growth of 2.8% and 5.7% at Current Group Structure and Exchange Rates in Q3 2014

6 Nov 2014

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By business, Consulting Services (4% of Group revenues) contracted by 3.0%. Local Professional Services (Sogeti) (14% of Group revenues) remained stable, with good growth in North America and the Nordic countries offset by a downturn in France. Application Services (55% of Group revenues) grew 5.1%, driven by the dynamism of project activities in North America and the United Kingdom and by application management activities. Other Managed Services (27% of Group revenues) reported limited growth (+0.6% in Q3) but progressed 4.0% excluding the impact of the reduction of hardware sales referred to in the introduction.
By region, North America reported a very strong performance (+11.9%), particularly in financial services, energy, and utilities, as well as in retail and consumer goods sector. The United Kingdom and Ireland region enjoyed revenue growth of 4.0%. France reported a slight downturn in activity (-0.5%), but grew 9.0% at current Group structure and exchange rates thanks to the consolidation of Euriware. Benelux reported a slight fall of 0.8%, marking the start of a stabilization. The rest of Europe is now growing (2.9%), underpinned by the growth of Italy, Germany, Spain and the Nordic countries. The Asia-Pacific and Latin America region contracted 7.2%; Asia-Pacific grew nearly 10% over the quarter and Latin America should return to double-digit growth from Q4.

Bookings totaled €1,987 million in Q3 2014, up very slightly compared to the same period in 2013.
 
At September 30, 2014, the total headcount of the Group was 141,045, up 7.3% on December 31, 2013. Offshore employees totaled 64,616 and represented 45.8% of the total headcount. The Indian headcount increased 17% over one year.
 
The strong Q3 performance reinforces the Group’s annual guidance for 2014 of 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 Capgemini Group: “In spite of an economic environment which remains mediocre in Europe, Capgemini reports strong performance. Thanks to our global geographic mix, we are able to capitalize on the excellent growth in North America (+11.9%). Furthermore, we continue to combine innovation and competiveness in order to offer our clients a service portfolio tailored to their expectations.”

Appendix

Utilization rates

 Q1 2013Q2 2013Q3 2013Q4 2013Q1 2014Q2 2014Q3 2014
Consulting Services62%69%64%67%65%69%64%
Local Professional Services (Sogeti)80%82%83%82%81%82%82%
Application Services80%81%82%82%81%82%82%

Revenue by business

 % revenues Q3 2013% revenues Q3 2014Q3 2014 /
Q3 2013*
Consulting Services4.1%3.8%-3.0%
Local Professional Services (Sogeti)14.6%14.5%0.0%
Application Services55.5%55.0%5.1%
Other Managed Services25.8%26.7%0.6%

* At constant Group structure and exchange rate

Revenue by geographic area

In millions of eurosQ1 2013Q2 2013Q3 2013Q1 2014Q2 2014Q3 2014Q3 2014 / Q3 2013
       PublishedOrganic
North America50153051649554057210.9%11.9%
United Kingdom and Ireland51050048253954254012.0%4.0%
France5515415145565875609.0%-0.5%
Benelux273268258265264256-0.8%-0.8%
Rest of Europe4694734184664584251.4%2.9%
Asia-Pacific and Latin America195222263182210238-9.5%-7.2%
Total2,4992,5342,4512,5032,6012,5915.7%2.8%

Year to Date Revenue

In millions of eurosYTD 2013YTD 2014YTD 2014 / YTD 2013
   PublishedOrganic
North America1,5471,6073.9%8.0%
United Kingdom and Ireland1,4921,6218.7%3.5%
France1,6061,7036.1%0.8%
Benelux799785-1.6%-1.6%
Rest of Europe1,3601,348-1.0%0.8%
Asia-Pacific and Latin America680631-7.2%2.5%
Total7,4847,6952.8%2.7%

Key events of Q3 2014

  • Signature of a major managed services contract with FrieslandCampina in the agri-food sector in the Netherlands.
  • Extension of a finance and accounting BPO contract with a leading European group in the healthcare sector.
  • Signature of an ERP roll-out contract with the Australian company, Westfarmers.
  • Signature of several SAP business suite on HANA® deployment contracts in the United States.
  • Certification by SAP HANA® of two key applications for retail commerce.
  • Signature of a strategic partnership agreement with VMware to deliver enterprise mobility management solutions powered by AirWatch.
  • Launch of three Engineered Systems service offerings developed in partnership with Oracle.
  • Upgrade of Capgemini’s rating to BBB+ by Standard & Poor’s.
  • Capgemini ranked by Gartner among global leaders for SAP implementation services.