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Accenture Reports Solid Second Quarter; CEO To Step Down

The IT-services firm says 2Q revenue rose 15% from the year-ago quarter, while net income was up 4%.
Accenture Ltd. said Tuesday that revenue for its second quarter, ended Feb. 29, rose 15% year-over-year to $3.68 billion on the strength of increased demand for outsourcing services. The IT-services vendor also said top executive Joe Forehand will relinquish his CEO title on Sept. 1, although the 55-year-old will remain as chairman. Accenture said it expects to name a new CEO, most likely from within, by mid-April. An Accenture spokesman said Forehand made the decision to leave because "he felt it was the right time."

Accenture's second-quarter net income rose 4% year-over-year, to $123.1 billion from $118.7 billion. But earnings per share fell to 22 cents from 25 cents as the number of total shares outstanding increased. New bookings in the second quarter increased 61% to $7.65 billion.

Most of Accenture's growth is coming from its sales of outsourcing services, which are benefiting from the trend among big businesses to send back-office and routine IT work abroad to low-wage countries such as India. Accenture maintains application development centers in Bangalore and Mumbai. Revenue from outsourcing grew 54% year-over-year to $1.2 billion during the quarter. Consulting, still the firm's biggest revenue generator, grew just 1.5% to $2.03 billion.

Accenture said it expects sales during the current quarter to come in between $3.4 billion and $3.55 billion. In 2003, third-quarter sales were $3.42 billion.

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