Accenture Third Quarter Profit Up 9.2 Percent

The management and technology consulting firm Friday reported net income of $114.5 million, or 27 cents a share, for the period ended May 31, compared with pro forma earnings of $104.8 million, or 25 cents a share, a year earlier.

Accenture said pro forma results in 2001 reflect adjustments related to its transition to a publicly traded company. Accenture, formerly known as Andersen Consulting, went public in July 2001.

Analysts expected the Bermuda-based company to earn 26 cents a share, according to Thomson Financial/First Call.

Revenue fell to $3.43 billion from $3.52 billion a year earlier. Before reimbursements from clients, the company said net revenue inched up 1 percent to $2.98 billion from $2.95 billion last year.

Accenture two of its five operating groups showed strong growth.

Net revenue for its government unit jumped 19 percent to $328 million. The communication and high-technology group saw its net revenue increase 8 percent to $882.6 million, helped by large outsourcing contracts booked during the first half of the year.

The company's financial-services group reported a 16 percent decline in net revenue to $646.4 million, as the division continued to grapple with weakness in the capital markets and banking industries.

Accenture said it expects to earn 16 cents a share for the fourth quarter, consistent with analysts' estimates. For the full year, the firm anticipates earnings of 65 cents a share on a reported basis, or 91 cents a share when adjusted to exclude net gains or losses on investments.

Accenture also said it is comfortable with earnings estimates of $1.05 for fiscal 2003.

During a conference call following the release of its third-quarter results, Accenture executives said marketplace uncertainty caused by high-profile corporate bankruptcies makes it difficult to predict when the business-consulting industry will gain steam again.

To capitalize on strength in its government business, the company said it is shifting about 300 executives to that operation from other parts of the company, Chairman and Chief Executive Joe W. Forehand said. The company's also beefing up its outsourcing operations, where it plans to hire thousands of people, mostly at the entry level, next year.

On Monday, the company said it was cutting about 1,000 managers by Aug. 31, citing weak demand for its consulting services. A company spokeswoman at that time said the work-force reduction was announced in an internal message several weeks ago and some of the cuts have already occurred.

Despite those layoffs, Mr. Forehand said the company plans to add a net 8,000 employees by the end of next year.

Mr. Forehand and Chief Financial Officer Harry L. You also voiced confidence in the recovery of financial services, but they said the ripple effect of corporate bankruptcies makes it difficult to make precise forecasts.

Shares of Accenture were at $15.35 Friday morning on the New York Stock Exchange, down 20 cents, or 1.3 percent.

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