=Accenture (ACN) reported earnings on Thur 23 March 2017 (b/o)

Accenture beats by $0.03, reports revs in-line; guides Q3 revs in-line; raises low end of FY17 EPS and rev guidance, in-line:

• Reports Q2 (Feb) earnings of $1.33 per share, $0.03 better than the Capital IQ Consensus of $1.30; revenues rose 4.7% year/year to $8.32 bln vs the $8.34 bln Capital IQ Consensus, 6% in local currency, and within the company's guided range of $8.15 bln to $8.40 bln. The foreign-exchange impact for the quarter was ~negative 2%, consistent with the assumption provided in the company's first-quarter earnings release.
  • Consulting net revenues for the quarter were $4.41 bln, an increase of 3% in U.S. dollars and 5% in local currency compared with the second quarter of fiscal 2016.
  • Outsourcing net revenues were $3.91 bln, an increase of 7% in U.S. dollars and 8% in local currency compared with the second quarter of fiscal 2016.
  • New bookings for the second quarter were $9.2 bln and reflect a negative 2% foreign-currency impact compared with new bookings in the second quarter last year. Consulting new bookings were $4.6 bln, or 50% of total new bookings. Outsourcing new bookings were $4.6 bln, or 50% of total new bookings.
• Co issues in-line guidance for Q3, sees Q3 revs of $8.65-8.90 bln vs. $8.81 bln Capital IQ Consensus; 5% to 8% growth in local currency, reflecting the company's assumption of a negative 2.5% foreign-exchange impact compared with the third quarter of fiscal 2016.
• Co issues in-line guidance for FY17, sees EPS of $5.70-5.87, excluding non-recurring items, vs. $5.87 Capital IQ Consensus (up from $5.64-5.87); sees FY17 revs +4-6% to ~$34.20-34.86 bln vs. $34.63 bln Capital IQ Consensus (up from +3-6%). Accenture's business outlook for the full 2017 fiscal year continues to assume that the foreign-exchange impact on its results in U.S. dollars will be negative 2% compared with fiscal 2016. For fiscal 2017, the company now expects net revenue growth to be in the range of 6% to 8% in local currency, compared with 5% to 8% previously. In May 2017, the company expects to record a principally non-cash settlement charge of ~$425 mln, pre-tax, in connection with the termination of its U.S. pension plan. This settlement charge will reduce the company's fiscal 2017 GAAP EPS by ~$0.39 and its full-year GAAP operating margin by ~120 basis points. Accenture now expects diluted GAAP EPS to be in the range of $5.31 to $5.48, including the impact of the settlement charge. Excluding the settlement charge, the company now expects EPS to be in the range of $5.70 to $5.87, compared with $5.64 to $5.87 previously. Excluding the settlement charge, the company continues to expect operating margin to be in the range of 14.7% to 14.9%, an expansion of 10 to 30 basis points from fiscal 2016. For fiscal 2017, the company continues to expect operating cash flow to be in the range of $4.6 bln to $4.9 bln; property and equipment additions to be $600 mln; and free cash flow to be in the range of $4.0 bln to $4.3 bln.