ACN - Earnings call transcript Q4 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by, and welcome to Accenture’s Fourth Quarter Fiscal 2018 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host Managing Director, Head of Investor Relations, Angie Park. Please go ahead.

Angie Park

Thank you, Greg, and thanks, everyone, for joining us today on our fourth quarter and full year fiscal 2018 earnings announcement.

mentioned, Park, just of Director, operator Relations. Investor the I’m Managing Angie Head As you from our will Chairman call today’s On hear Executive and Officer. and Pierre Officer; David Financial Rowland, Chief Chief our Nanterme, hope issued short we had news a opportunity review time to We the you’ve release ago. an

along Pierre and details, results. metrics some me take David with call. for you quickly balance including an with through agenda the begin Let financial the will statement income overview sheet outline the operational today’s will of key Pierre our the full before and for fourth our brief fiscal for outlook quarter both quarter position and will update fiscal full year the David market a business first year. provides XXXX. our then provide the on

your at before wrap questions a call. the take the of provides up Pierre will We end then

limited on risks the news Annual expressed forward-looking are known Reports release as business of materially we’ll Some risks uncertainties, forth matters results those Form differ and uncertainties call, including those and including other call. and our subject this could outlook this not in today’s such, to on our to filings. and SEC unknown factors to are set Report and in discuss Form XX-Q Quarterly cause on from and actual XX-K on discussed and These but

where accenture.com. information call the our website GAAP During to in useful include section will investors. of for measures release financial appropriate provide reference news today, believe We measures we of which Relations our certain non-GAAP at in we financial Investor or reconciliations our non-GAAP

presented information update call. assumes conference always, no Accenture As to this the obligation on

to over call the Pierre. turn me let Now,

Pierre Nanterme

joining for you, Thank and Angie, everyone, us today. thanks,

fiscal financial with our results and fourth both We quarter for are extremely year. the outstanding pleased full

strong We very we leadership significant with we year, strengthen substantial times For in to our Services. shareholders. our largest again. share Digital, New", the And nearly returned to once Cloud markets to of market growing and market Security growth three all position in about gained our "the cash continued

$XX.X the We Here for of billion. the new bookings are year. highlights few delivered record

of $XX.X basis. share with XX.X% generating last balanced per across currency. increase. Operating with dimensions record delivered adjusted of basis, earnings $X.XX adjusted We’re another an pleased an We again growth on especially the I was business. once of billion, of and our margin record XX.X%, our year a local revenues XX% on in am consistent

generating $X.X of over repurchases dividend. a share cash XX% billion. semi-annual share returned per prior We’re cash $X.XX outstanding flow we announced billion cash and our to increase shareholders dividends $X.X We of in just a through free and dividend

year we and I durability our strong our the delivered in new the performance feel about the very So, excellent an have as of we and enter we fiscal fiscal year. momentum business, XXXX good

David, in detail. over Now, the David, you. hand who’ll review to me numbers greater let to over

David Rowland

of you Accenture’s value were drive business manage in clients, leadership the discipline to power all truly Thank results measure you, any our our unique and results the taking and leveraging By another our by for rigor year call. These underpinned significant while to us been full time position our capped Pierre, ability thanks our quarter what people and has to today’s marketplace off Accenture. the shareholders. with join of for our outstanding on fourth for

all driving in of currency for double-digit net once a execution of XX% of across few three I summarize growth. imperatives financial superior again Before shareholder Revenue value. quarter growth continued with quarter me strong the important our revenue get fourth consecutive local details reflecting reflects into let very of which the momentum the strong highlights

our the growth position model. in reflecting yet market New" "the to continued of durability growth both focused Our the diverse leadership and significantly highly outpace our

very up cash were we basis our $X.XX and $X.X of X% than XX in people, margin significantly the allowed which bookings. by profitability And better driven Our and let level details year. strong was comments, XX.X% strong and of invest pleased industry EPS turn business growth in profitability, to with we DSOs. underlying with from as me points flow in those expected finally, billion our delivered expected and year. and leading quarter up of was free delivered the last from of our continued came high us some We new operating which last to With starting fourth

our were represented billion theme bookings a were billion, for "the bookings more of highest $XX.X record. which reflecting of X.X, be with to were the our New" than book-to-bill continued and book-to-bill New representing X.X. of on $X.X XX% Consulting bookings total and $X.X all-time a second billion, bookings dominant strong bookings. for an outsourcing quarter high The demand

system For were year, growth and we $XX pleased fiscal the in XX% local delivered and we particularly bookings nearly integration. full double-digit currency and represents new billion in bookings growth strategy which consulting and with

$XX.X revenues. range. the an XX% USD were $XXX and was Turning currency. top-end the for both our billion, revenues of in now guided Net quarter above local a to This increase million

were consulting local outsourcing $X.X billion, were our in both billion, Our currency. and revenues local X% USD up quarter XX% and the $X.X up currency, for revenues in and both USD

to in very balance services XX%, our and business and services broad-based especially growth, our operating growth SAP, by in strong with dimensions we America. strong and across in growth closer strong growth growth in related groups, double-digit resources Looking local also growth Taking growth continued for all at our reflecting deliver estimated three look posted Software federal industries quarter strong and U.S. at geographies. like growth its growth driven operating service, in grew primarily the saw the an driven and strong growth. XXth consecutive momentum Security Salesforce, We grew quarter. growth. And Strategy a New" double-digit X%, Platform Cloud Application with in currency, Communications, pressure all strong continued our last groups both continued were Products three double-digit markets. and was H&PS Technology growth Operations in all North [XX%] We relate saw double-digit pleased I’d public of geographies. in Intelligent double-digit with America demand North three led flat Europe an to industries Consistent with trends double-digit all our Services, delivered as across revenue in and very in the including dimensions, as Platforms Digital Oracle, and which strong reflecting XX% Workday. all technologies Microsoft, contributor Services. all growth "the Services, the growth well by Consulting next-generation three primarily which across quarter, some business. to across Media with These deploy especially highlight important to

and in by in growth in services Finally financial grew America growth some reflecting double-digit growth Europe. in capital growth insurance saw and growth We markets. good challenges the North markets offset and X% modest banking in solid

growth similar a the expect of level We in quarter. first

XX.X% Operating quarter gross the down in quarter income X.X% in compared last the expense quarter same for quarter the expense for marketing was was Sales fourth reflecting operating year. period XX Moving General year. with a for margin, quarter year. four compared XX.X%, last the X.X%, same was to points, year. was statement, the fourth billion up XX.X% basis income last the the to compared $X.X XX% and and quarter, administrative margin last in XX.X%, compared with

X% compared year-over-year the effective for with outstanding were last in share $X.XX, rate Diluted last consistent The the fourth last EPS with per XX rate quarter Day liabilities. fourth year. increase. tax effective and the the earnings fourth services XX.X% quarter of quarter tax higher rate fourth $X.XX was reflects in last for This were year. quarter XX%, of a year days, to in of tax an was quarter primarily with year. prior increase compared tax related quarter the Our an

of cash the Our operating million. $X.X free equipment $X.X billion, by from and $XXX resulting property cash billion, additions flow of of was for generated net activities quarter

average the of additional to billion. Our at fourth $XXX cash million our billion cash $XXX.XX With XX for at year. billion August $X.X share. our the XX bringing shares balance ongoing $X repurchase approved shareholders Directors total at last per to in million billion of to quarter, X.X with objective we to $X regards of August return repurchased week This or an compared redeemed share $X.X authority Board price was

of paid on declared be As dividend a Pierre over represents November cash the we our semi-annual Board mentioned, dividend share. $X.XX XX, will This Directors per previous dividend and declared a XX% of March. per increase $X.XX in semi-annual or share

where Pierre, want of I it before on year reflect full landed business to key September. I elements across So for last we outlook provided the our the over original back to turn

U.S. our and recorded recorded to results. applicable we reminder reflect unusual pension Last charge year two changes. impacting this comparisons to related year. and As these law we exclude termination this had charges metrics The the were of impacts a for a settlement following plan related tax adjusted we year items

For business with the double-digit that to with currency and margin and revenues basis, many was "the year guidance updated our end an a our our growth the strong growth with was and be full above reflecting XX% guided grew provided while net security-related New" below leader XX.X% cloud year in all of in with range On X%, our focus the across services. organic XXXX in strong of year the FY operating range. XX.X% for original we beginning line well growth. overall the strategic of growth digital attributed approximately represented the of top of to at consistent areas local our revenues market Roughly slightly posting XX% of adjusted guided of

continued invest we're strong earnings was driven On above basis us XX% over the adjusted earlier, growth mentioned long-term underlying that per an XXXX leadership. was market to I and allows pleased As primarily the guided has by to range continue FY margin that share - original per with $X.XX allowed growth. topline diluted improvement reflecting for share us

capital above to returning of market. Our and $X.X million critical areas $X.X capabilities skills billion billion reflecting objective delivered discipline the of flow while on original cash was again roughly and industry-leading $XXX of range guided well And allocation the our by acquire cash investing model of operating strategic we and high-growth finally, our shareholders DSOs. strong to free

gains of significant and market So cash again, underpinned by we growth had profitability strong another resulting outstanding year broad-based share flow. in

to turn Now let me Pierre. it back

Pierre Nanterme

Thank you, David.

growth well. demonstrate strategy Our competitiveness differentiation outstanding execute profitable of and our to extremely we results fiscal XXXX year for continue that

Our very for our reflect revenue excellent strong our new services. was demand bookings

years, and have agenda. gained clearly market and over are the leading in in client's relevant "the we few services are our We share highly the New" marketplace to our last demonstrating that significant capabilities

to return five growth pleased especially significantly I'm in that annual of annual revenue delivered annual in local have Over XX% we years shareholders period XX% X% the SAP-XXX. and total the share. adjusting over fiscal currency a delivered return for we compound And of per total growth last the have XX%, compound above compound the earnings same

Our offerings strong investments to to as the well curve of our reflects managing competitiveness, we our made and we enhance and durable have as relevant bring business. rigor performance the discipline the and ahead the differentiate

and to digital, cloud significantly rotation XXXX for the revenues improve scale double our fiscal customer to marketing with become $XX the and three In experiences. the market growing Radisson Hotel leveraging industry to truly rapid we Today services we for at our their "the Interactive Why leading or pleased with working I'm than Our personalized acquisition especially New", world's success of contributed more the "the the many capabilities of just to operating our XX than performance. revenues retention to has leader analytics experience create had Accenture in brands. global at Group Interactive. XXXX accounted that In security-related and customer years in countries. total expertise, billion core have approximately business. We're more has digital New" are ago. New" digital, agency data Accenture "the more XX% travel year is for

like we platforms. a which you manufacturer, continue more competitive are expect launched analytic innovate the assets IoT digital Accenture range indeed where app to an Things, clients With industrial deepen can its customer platform, needs. performance, capture Internet to And industry the customers. invest of With we switch multiple would mobile making that now ABB, helping manufacturing are devices and recently, knowledge its sensor technologies As from new models smart we sensors new connected ABB advanced of we we X.O apply embedded growth. with to and excellent ways and and about with Solution that's to connect developed advanced portal in data electric progress to

hardware software We partner firm a quarter; Germany. X.X Francisco engineering continue in same to platform machine also learning Mindtribe, company to its At a and technology we new industry capabilities in time, players advanced in complete Oracle as role in of Microsoft, That firm invest the and three with including of re-leading the Ohio, unique continue SAP, our rotating in to are Salesforce to and a ecosystem a our Designaffairs, Technology, cloud-enabled New". rapidly capabilities. Columbus, platforms leverage evolves the analytic, Pillar acquisitions design intelligence in first San which generation and key artificial "the

We across industries their the to Italian food of broad range to transform from S/X businesses the around Australia's company. clients world are a brewer, using Barilla, Lion, working Solution with SAP utility, Chelsea, largest the HANA Latin American to

X% growth the America, markets to X% broad-based we in an very currency Japan by to growth in year continue to I growth And performance Australia, delivered most In now business, gross growth. double-digit in XX% in our growth our We geographic the as as acceleration single market. the are increasingly with and single-digit significant our by with strong drive Italy, very largest local France North in of growth the currency Brazil again Island high Spain. and once in in high dimension double-digit currency well strong as digit local another year growth primarily with well double-digit we in pleased led delighted that feel growth driven local Germany, our Turning finally contributor of United becoming by Singapore. growth as for States. led with of the of our I'm revenue deliver for year Europe business Starting in very

apart want Before I I strategy share the marketplace. talent a us to turn in in on our continue leading it to few New", "the David, back clearly thoughts to which sets

XXXX company, want these over named advantage. diverse Inclusion were is proud a and that Thomson world. source XXX recognizing I'm David. number developing their our thank for investments the intimacy in the Reuters specialized Over scale people that and transform And critical competitive outside difference the on from diversity our we have delivering that and leaders you, Index David and we which makes And Diversity substantial very especially Accenture, Accenture services directors pleased we we XXX our that the and are and importantly people our hired adding in turn focus more particularly and of relevant of the passion to Accenture that, are it extremely outlook best client. promoted Our all making skill I finally, significant we Accenture just to ensure And high months, to the XXX,XXX top energy business quality With needs. as to provide I XXX clients. nearly industry in meet most on the XXXX. about we specialization. fiscal believe we possible expertise client's year most and which And makes for to fiscal team attracting I'm inclusive continue managing companies for At for industry. new our and to in year to will to difference unique the our

David Rowland

Thank you, Pierre.

into I want for FY our changes get XXXX and a highlight I business beyond. Before to outlook few

our our New" not posted For on the website. XXXX material we intention and Fiscal reporting. have revenue standards on our reconciliation In adopted does impact accounting have summary financial adoption "the a IR

margin result margin a will include going to will a operating for result XXXX the reported that as be will revenues impact a of and revenue Also FY there report XX.X%. compared restated number single which these corresponding will would forward However, operating now reimbursements which changes be as notice to a include you'll we XX.X% to reimbursements.

New" the and schedule. XXXX, and the dividend adoption presentation revenues like of a in the change XXXX FY first our as fiscal of "the in the to payment a FY from Beginning semi-annual effect guidance accounting take will comparisons of on pay semi-annual the taxes operating in will we FY Our change we standard dividends. as on This a impacts to basis. for dividends of a updated including on change I'd quarterly payment continue standards also will in schedule XXXX, be and XXXX resulting reflect in FY payment the revenue to to making in move the transfers. intercompany will quarter XXXX margin, income well pension we dividend highlight

outlook. me turn business Now to our let

quarter about in fiscal to compared local negative For be fiscal the quarter XX% X% $XX.XX will of to FX expect first currency. growth of XXXX, be revenues an first we to the estimated the billion billion. in of to of range $XX.XX the and reflects assumes XXXX X% impact This

trending upon weeks, impact the be few fiscal For to the FX in been have results assume the based compared rates of X.X% negative the about how full fiscal on USD XXXX, our last XXXX. currently over we will year

of our currency fiscal full growth XXXX, the be to in over revenue X% the XXXX. X% local we expect For to range in fiscal

fiscal we margin, XX adjusted basis XXXX XX a point XX.X% over expect to fiscal to operating results. to For XX.X%, expansion XXXX be

effective in expect effective XX% XX% compares XX% annual of XXXX. the We rate and be range this of our fiscal to in tax an tax rate adjusted to to

For to earnings adjusted of XXXX fiscal in expect results. $X.XX diluted growth range for X% be we $X.XX the share, per EPS XXXX full-year over to X% to or fiscal

XXXX, property the billion in flow be flow $X.XX million For cash approximately to in and and $X.X for $X.X to expect we be $X.XX full range cash to range the cash be to flow billion, operating equipment billion billion. the of free $XXX fiscal additions of to

income substantial a we cash return open can questions. portion remain repurchases it finally of $X.X up let's X.X. dividends your our committed a With cash to take guidance billion shareholders. as of that least flow Angie? that, returning and flow to so to share net we through Our free X.X free to And very at expect strong reflects we cash range ratio to

Angie Park

would I to David. for as on each question that ask ask those a the question. to would follow-up provide Greg, you and to as participants allow Thanks possible instructions keep one many you a call.

Operator

[Operator Instructions] go line of the Foresi Your comes question Fitzgerald. from Please ahead. first from Joseph Cantor

Joseph Foresi

will like base how off could next talking if and think wonder what and year? drivers about look I exiting will margins expand we year by you the the margin this margin start how should about

Pierre Nanterme

mix But leading year across value that New", which "the strategy on our over a work mix focus the the in our way fundamentally really you previously it into our work expanding focused at be with business strong it the dimensions, of first outcome our leading be quarter what our we consistent and also and particular of I services which are in impacted gets things with geographies. with the we're the services, economics services those price profit and mean driven contract for into talked profitability I and we profitability work by all Yes, about influenced or focused number the margin course including of could and of gets of a profitability to time. the contract look course is discipline and we on objective always the And deliver really profitability our of ways, so in clients contract of that high our and can clients profitability I've starts on delivering our agenda. of supports of be course across very it to perform two our in all to by mean expected drivers high can on is that

efficiency if continuing things next and the structure of relation on to to of also that course revenue drivers ongoing look payroll other our things doing evolution managing cost that. our always the expansion evolution the structure another you in of have it our come at those our year. business the lens our we of And finally on would are focus then of on efficiently of through margin in we're The two focused for profit all improve and SG&A into an focused objectives be

Joseph Foresi

staying just margins. with follow-up my as then And

your the with the that you expectations obviously margins? to how front, desire and balance for expand contribution M&A to what's top On your do line Thanks.

Pierre Nanterme

our organization circumstances, be it’s organic that. to that our about experience of could contribution of right we have using how expect inorganic times our is strategy the I margin firmly of we many to we from and time, opportunities that to manage underlined This about externally, say point as mix our consistent year our can part important time FY includes our around a spend again to we X.X%, so year profitability but referenced billion a all spend next you've that Yes, investments an that inorganic standpoint, report expansion is expect growth XXXX underneath committed as margin as to reinforce improvement the heard we that's our which margin sufficient all in than our focus which $X.X lower we inorganic that as in our improvement are from strategy and would engine us more to allocation the always an the over margin of with we certainly growth. in time get And acquisitions we so capital given strategy. our up right than to ambition of underlying absorb

Operator

Your from of comes Edward Fargo. Wells the line next ahead. go from question Please Caso

Edward Caso

of rising maybe sort your rates. or on of versus getting trying dig Can efforts the little bit showing seems are higher comfortable you’re what this you slow Can little maybe talk and you're a XX% lot bit side, at attrition that year you peers why down down level? XX% a rate your to was people a ago a on more

Pierre Nanterme

directly question. your answer me let so attrition, on Yes,

We the are all. at not constant with XX

the be we it’s we level in believe competition attrition talents the given of are clear, of marketplace. Let’s I think level today, for reality

mention all and we place advanced fact the very is Internet, ways intelligence, artificial a "the are to to we issues I the mean I attractive, to can we new today interactive of and the across strategy, rotation manufacturing be creating have are We everywhere do that it world talent true it’s attractive to and be. mean these in leading first hire analytics, the and we way cloud, - our from need that zero so New", and I blockchain

is performance. our Second

course are we its reading I’m from in France, it's industry of and in one professional an dimensions industry I morning, for and board. standpoint, the number a technology from the talent. as the standpoint attractive the services in We across was the this are fresh leader all just in from Paris],

So our environment providing strategy our balance we have the it’s and issue we zero to being and people. finally attractive

I worked to think right collaborating. where we a lot workplace the create are people

We style add a being to coming it’s a creative right and we thinking. and lot developing benefit leader. our at are to creating multiple environment are tone of together cultures And developing of Accenture and probably its the

Edward Caso

question starting around industry reuse it other how already reprint "the from opportunity New" here much it built sort to to there leader an platform to is a like and relates that from the an settle getting are done? like seems for seems in lot benefit My you’ve of margins, you of you what it -

Pierre Nanterme

Yes David, this the this to I on success us on our one jumping of mean platforms extremely important country. for are

and strategy Microsoft, top and Workday of we’re what calling the the the always specifications. intelligent important is Salesforce provided by same. system the partners we are is build that marketplace could but platform the becoming been more intelligent Oracle, clear has and and add because this them more We best in on leveraged industry platforms so and our SAP, others platform this very and now our think I that

the Salesforce gas. and and speed Salesforce.com on company Velocity So joint in utility for a specific developed with called SAP working add an capabilities. of the oil working platform The objective on we’re of industry when very with upstream same top the in we solutions specific develop on instance Velocity add is have that we’re

is this well. So very strategy and it’s so our working far

Operator

line ahead. question Huang the of from Please go JPMorgan. from Your Tien-tsin next comes

Tien-tsin Huang

revenue Congrats believe of you look if sort X% growth. X% the bigger year momentum, just to the exited X% growing double-digit ask growth. curious on you guided brand to and I’ll a year on outlook revenue am we I it the I on back ago,

your So but this X% at is guidance to using year XX%. X% you same

last considerations curious the macro demand more this across bit case digital versus cetera? being year So might mature be I am competition, upside et any little different year how

David Rowland

doubt X.X% be the time cycle. we are organic our third the to about there that had that business had also is XXXX feel I as point time, organic providing We the of in good the longer we growth the in you And strong no in business we to would our fourth also doubt positive our guidance so very record first bookings second it is same about of all say mean the sight good that I have the the in got clear. to growth quarter we where of four by to and high all-time momentum we you line for have to we feel the momentum fact way and is the have. reflect we lot And us do quarter you was there was the We point and over strong no mentioned second could on with fact and exited of in quarter half At that broad the very only we three. quarter year. to things do in in and as based organic this there XX%. is that a

this well perhaps but same than in our debatable I environment year volatile it standpoint point more would and year incrementally And guiding by say we’re over the that the the at the XX in essentially mix also time. environment and very the comes so to last fact was macro as may of nature macro be from we that months. in of what’s the its take happening And stock is

investable X% in the to guide the of horizon. we You that is we X% X% and in about a the XX to and Tien-tsin that in that so of the can X% a remind think And the X%. reflect the potential basket And to for course thing around global others market our month and think global growing hard about would you Brexit. trade we that to on market disputes of it’s that I over guide really you is X% environment all other context range of to

X% which where more to would for market. would so on X.X we times always range And strive you of at share anywhere if growing think range X% and significant be end upper than the we the the of taking X% we is that guidance about be then

so And for in how three Anything the X% growth be over had the and our in the exceptional especially we fact true plays that pattern is appropriately last upper is of years guidance consider out leader. as we’ll the XXXX outstanding we is done end we last of with that and to X% years above what year delivering a would of that growth consistent the Accenture as range which it we’ll we’ve what four reflective do reflective progresses. see and double-digit a is update growth

Tien-tsin Huang

ask broad impact few bit the financial it based just mentioned bit Thanks or a sound I North you wanted America it a okay much. seems like there? now follow to was clients sound bit lag so it I’ll region my just a up detail or it services David get it Agreed, little like just isolated know was segment little very to a prudent. little quick on the

Pierre Nanterme

down And we pleased are situation some due program summarize to mainly to very had comment context services. financial where we it’s in it’s to of facing so on Europe this XXXX. winding the challenging Europe the lower sure in growth. Yes, large had If mainly of I

had remember not ago large just years Europe years. is which same close. other a some that this I industries the the way program to happened in last in something we getting phenomenon few So CMT of two un-typical by

that very is create to do you you tomorrow. and to the what And build of is are working need need so now the to to backlog hard replenish the and revenues it pipeline going people

indeed encouraging of quarters of to to the is the growth, going We back people show we signals believe pipeline more the have it, still So that it’s in to and HX to we take on the so get our that digit expect then single Accenture. services HX certainly in with power working in are Europe building financial be up. our low couple in rest

un-typical anything this coming think not from do I happening to are industry. So anything

Operator

Bourgeois Your Rod Please of comes from DeepDive go the Equity line next question from ahead. Research.

Rod Bourgeois

over headwinds that’s accounting actual I your guidance to am in months starting are gauge and are the or I flowing next for possibility outlook upcoming about might So next you ask, into simply headwinds visibility or months. your the in seeing you of is seeing macro what want prudently the of the trying to the could just impact XX happen? the terms grow revenue course XX just growth thinking growth you months

Pierre Nanterme

take are of good this. cannot element From where with I I doubt and on no we one some this standpoint, think an pleased mentioned momentum. with David we’re entering we Accenture already are QX because

QX the XXXX. end us for Now is of the calendar

a calendar speak January new impacting happen this like be and soft I specific we’re of effect some moving to see instance the more business. to trade is Xst, so war So hard an But a just look build negotiation any Brexit we’ll a the there the trade know for be not Brexit industries might as industries what forward something by XXXX. get what’s seems these in understand but and we’re to signaled very to than to role effect we now and calling going again beyond a And its one. you to leadership the What ripple our not we there mean it’s the happen now. calendar and what company going war moving of impact might to to something moving horizon that is we end to mentioned on David on the could to

in what very you’ll been are Brazil America. closely which complexities we're great. Latin We in absolutely doing that is America, the see watching well as we've despite Latin region, well doing

concerning as risk mention too the commodity in oil long we Latin pricing. ago America and price getting are at high. now volatility see very, barrel $XX the to all other to know again not the talk you’re be very about to we Not well, some starting a prospects and Now it’s

to in We volatility see these about how commodity are going all we of calendar will XXXX, things unfold. again pricing to see some

guidance that accordingly. So is to adjusting our to nothing the our consider answer, is now job risk but and

growth what is competitor and said is guidance of being at of that five the if the market. absolutely basket said, David you true aggressive to look an eight the Now

at that it’s to the I would not three times So that as consider would X% two be conservative. market.

Rod Bourgeois

anything around case in there fiscal XXXX the buffer that flow outlook? tough lumpy you XXXX on sets there cash flow a on in Is fiscal items XXXX cash up the in flow moves cash free outperformed cash XXXX. outlook, free for which then comparison fiscal outlook, lumpy you I include fiscal on flow are the DSOs sometimes special but some in any know free And

David Rowland

is a happens had I exceptional not than that for for increase is on which Rod every the beyond assume year then in the change. mean XXXX, we normal anything number that’s allowed we of ratio and - kind actually that example example. had guidance DSOs we there's that income. mean in other regard the to quite again have net do X.X outstanding so in in the DSOs going from that range not relation of we a as standpoint, income and the strong that’s in an is in Again no of really to to potential times there we would in an some and the mix. pleased the absolute you're year special to things we more free lumpy be But factor we items would net year land I year-over-year very guidance in an focus cash flow X.X

Operator

Your next from line ahead. from question Please Peller comes Darrin Research. Wolfe the go of

Darrin Peller

offset on giving little maybe seems is seeing around what New" give just be guidance the inflation you start or what I able pass more seeing wage on color like digital "the areas. of those pricing you’re me a but better your through those Let more you How mean color can just are it in specifically increase off, price for margin on areas, just to two to a you little variables? it should around some

David Rowland

that, make Pierre wage with to geographies I of stay about size and may the away for in Yes, questions our of couple and skills them. from I really the diversity a it’s aggregate it’s cetera, comment - and and of first well. hard mean typically talk market, with it's workforce of we a of leading are the premium mean skills But the let certainly the high that growth go there pay and say market look of areas at lot edge generically especially we salaries the market cases just in many of - and will areas I mean I we et those rate. as always all add that reason we you when premium people hire the me

and we and we're we ultimately there's to those about, upward yield in regard, feel pay rates the to ultimately for we about hand, a the off pricing resources people differentiated profitability or paying market what of in not our retain have right I other can to pricing on purpose relevant right digital set is on always to is which bill of skill for want that fit focused the get people that the rate talking said we're we that what kind do On we earlier that's point that. that in that contract the about and concerned we so relation at we're but whether get we're we positive not, means the anything profitability get we're as focus driving not and

Pierre Nanterme

the and the mean, working comp. people is Yes, and interesting that wish about it's three balance that on driving the interesting second money. and the and And number analysis environments maybe surveys, just you're and to retain work all the the people, one number at of this, it's working to not always is one, when is center attract I add the

the have and not could giving diamond it’s the what point to the the rotation at the going this and one with So more to do of end people working about our clients. our "the New" interesting paid the is be we who is most company going money to be to is most, for provide or work our the day, with

working I you need mix indeed a it's so of compensation, already competitive mentioned that the things creating on. right Second, work and to environments

Darrin Peller

is mean that sort guys. outs you know just of I of big other a center versus you growth just of down also in Cloud of growth and And thanks has deconstruct side again a a could what around party breaking little are I mentioning interactive there maybe big any some the which the more and follow-up, call specifically if worth been seeing

David Rowland

some very comments double-digits in we of color a in as mean I growth we that the Pierre couple terms and as well. double-digits. continued our strong of "the has facts say of first when just we've strong double-digits New" said was add mean make I’ll and strong may and - some all before,

the see in at also we Applied when every strong of when the you "the And Accenture so digital, when and New", of look let's of components So component, and New". across north look Intelligence say three at "the well XX% that you Industry is we at look growth you that X, goes about growth contributing components Interactive, our you our strong double-digit position cloud businesses related rate the we with respect digital look the see when each services from These with at we leadership all talk double-digit to and are growth growth very and New". and - markets, strengthening security, often are it. attractive that those we're of in are "the very numbers the benefiting Accenture with overall to

Pierre Nanterme

XX% more I be clear. to are clearer even them all [zero], as be we growing you mentioned XX%, think than the could Yes, because of very

Operator

Please Keane ahead. question line the next from Bank. go Deutsche of comes Your from Bryan

Bryan Keane

that. I wanted to follow-up ask a on

that the a flat guys to versus going see in of there's declining slightly amount just constant certain a in that year because you XX% a almost fact there see that the so forward? business have grew year always last we past and think point business New" we've I have about if occur legacy I have where as "the reached want last business I spend that being fiscal declined XXXX, actually business much as guess will maybe won't legacy means with core we up, legacy in currency to that

Pierre Nanterme

calculation. so declining made call make the prior exactly more But we to analysis to Excellent to than the core and worked is indeed. the behind protect but you the rationale year, competitive. less in not The right analysis the call is hard

which been was not we’re it "the put if going New" our like to or was our decline have let core and strategy would extremely investment bad. behind becoming So the all uncompetitive

you been of have accordingly summarize modernization would to core the have where are core activities into margin extremely is to as able or massive we and instance form what limit have the a and term I the the in outsourcing erosion. automation providing indeed robotic reached other So - automation if protect we the of put which we of well core level for in in we of and application high and of invested

you're because So, it's for on more modernization. right, it absolutely we and robotic worked but automation

Bryan Keane

and the adoption a here. make not the accounting, operating getting underlying boost are the accounting. the restatement And would've XX operating changes then, same expansion pension to Some those expanded that's be still David, if points? still to without without pension just curious margin basis folks in just on or That’s operating Thanks. margin case want sure changes? XXX margin through XX I

David Rowland

the is same That be changes. without would correct. the It

Operator

from question ahead. comes from line Bryan go Please next of Cowen. Your the Bergin

Bryan Bergin

a in pull follow-up macro forward there to like tax conversations spending questions. client any I just that on in wanted demand to the the due of you're is deregulation? budgets, your there's been U.S., In reform the demand having broader things indication XXXX tax or

David Rowland

those I pull reasons. would evidence that of a we there's have been No. forward no. say, spending don't think any for I

Bryan Bergin

what follow-up, new, you Intelligence? a in Can these business new areas Industry like X.X out new sense interactive then leverage able the you're scale of learn then you my were And building about building these you and that areas? places us from in of Applied talk as - to give area And just businesses?

Pierre Nanterme

Yes.

in spending we initiatives. we're Accenture. And at job have a Research, in is is Paul of and call this strategic R&D growth Accenture their of And putting coming. next $XXX first to intensify established the Accenture, R&D Daugherty, role what to from routine which kind is specially incubation we clearly we know ways a you in million them Now an as at is to what's understand moving and

models. test a level scale other to business So and create client of This get industrialize the move incubate. we did we with we maturity, big see business and to we to then into Accenture. for We're and when impact of is opportunity what And the starting an the businesses. we

about we So process of to this incubation industrialization. learn

combination have we about talent Second, this where organic it's and is all growth. And between the leadership. acquisition and

we mentioned quarter. attract are we are of a small the this and indeed to mid-size on companies X.X X.X call, in three for investing so in Industry software acquisitions especially embedded making very mid skills, and that I we - design the So in deep skill made acquisition lot. instance, product Industry the having where To

I So campaign Chief Amy now communication this we how course combine we see all know good to next putting Fuller with could to behind. and Officer supported, of of me, our Marketing

savoir-faire a term launching the in good So and - mix of with a organic have developed behind. inorganic we incubation, of behind incubation detection, and campaign industrialization

So its quite as well a oiled, if will machine. you

Angie Park

and more Greg, then time Pierre question one will wrap the for we have call. up

Operator

from question comes Bernstein. Harshita Please go the from That line Rawat of ahead.

Harshita Rawat

My on question a is headcount follow-up to one. previous

So a That's big obviously a you're basis. annually almost number. XXX,XXX gross hiring on people

looked market Are at and you've in versus to of find think to and at supply in And what more where drive a attract is just people? your a skills labor very constraints which should continue kinds more we about are from? different historically? broadly tight people not people question my looking of automation hiring puts ability how you So you

Pierre Nanterme

where on U.S., in to to markets lot continue of New", this, Germany metro the markets had as in in rotation countries we I especially you a three Germany, France, our it’s if other mention Japan know, a would recruiting true U.K., Italy, to I are I as are our mention U.K., - - Spain. hire we markets But we maybe lot. onshore well Japan maybe On certainly the and large mean, are context "the largest U.S., our

that visit "the New". in of would and year of everybody around of away all by event And for mention called you at about especially Not truly their It's had all. our India. some quality of I'm name, driving skills and term offshore of true context R&D all. deep been largest the and now significantly and onshore to giving than would New" and our, polarize moving to where working with opportunity be let's and not going continue the our true less Diamond not that clients the session not who've last rotation blown call be support clients, brand high-value and relationship consulting that team Accenture the offshore onshore in an in people hire an probably the India e our - to at especially but of we for the And with to in in on to from some brainstorming. So on there context "the legacy. thank the would more innovative at largest me innovation U.S. the being We hour we'd clients

markets. question, the onshore find We continue the right right in including is many skills. And markets there We And pool? offshore, this we operate don't scarcity your right and drive and balance So, people we second believe. to the to in having exactly business invest many the scientists. is in why,

today these XXXX find have think us. around question, scientists we Accenture, more could business for Good your I than growing, people is at to and the we very all prior world. attractive. Again Accenture

And based to attractive people. have our need our and we we on So right results positioning, finding no take in chance. we are the while issue

Pierre Nanterme

So, and us thanks call. a lot joining today's on for listening

and and XXXX. position and making very with our fiscal to everybody. question doubt No any team. have forward might our In stakeholders. delivering you market disciplined if to We strong ability significance I'm we for to continue extremely in year New" call we the our the the all As our on first with investments confident during and leading of are "the please and year next best pleased Angie strong have the to for guessed, the you excellent business, meantime, XXXX feel a again finish in the with value are the management quarter. look and gaining talking have free I'm momentum share fiscal performance we you All

Operator

Ladies participation conference you for and today. Teleconference. AT&T Executive your and for Thank conclude gentlemen, your that does using for

may You disconnect. now

Accenture (ACN) 27 Sep 182018 Q4 Earnings call transcript