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BlueBook Accenture Presentation - Ritesh Patel

Accenture is a global consulting and outsourcing firm with operations in the Americas, EMEA, and APAC regions. It has experienced positive revenue growth in recent years due to increased demand for outsourcing services, investments in new technologies like cloud and analytics, and acquisitions that expand its domain expertise. Accenture has also shown profitability even under difficult economic conditions. Based on financial forecasts and valuation analyses comparing Accenture to competitors, the author concludes that Accenture's $60 billion market valuation is supported by its experience across industries and geographies, and that its shares are fairly valued based on assumed growth rates and discount rates.

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WHY IS ACCENTURE ONE OF THE WORLD’S MOST VALUABLE BRANDS?
Table of Contents •  Executive Summary •  Industry Overview •  Company Considerations –  Share Price Performance –  Acquisition History –  Operating Performance –  Valuation •  Trade Idea •  Appendix
Executive Summary •  This project considers why Accenture (NYSE:ACN) is a valuable global brand from an investors point of view •  ACN is a global provider of consulting, technology and outsourcing services with operations in the Americas (47%), EMEA (40%) and APAC (13%) •  ACN has experienced positive revenue growth in past years and is forecasted to continue this trend annually, due to the following business initiatives: –  Outsourcing business witnessing higher growth in contrast to declines in its consulting arm –  SMAC stack (social media, big data analytics, cloud) •  Pressure for financial institutions to automate services –  Acquisitions (increasing domain knowledge) –  Revenue increases alongside alliances (SAP, Oracle, Microsoft) –  Trend in cost saving initiatives have increased demand for ACN outsourcing services •  Healthcare shifting into IT outsourcing •  ACN has shown it is still very profitable even under adverse economic conditions/within a very competitive environment: –  Strong US dollar, reducing ACN revenue (high translation risk for their international business). –  Trouble in Europe, reducing demand for their consulting businesses •  Based on our forecasts for (FY2015-19), applying discounted cash flow and comparable trading multiples analyses of ACN’s closest competitors (IBM, Cognizant, HP, Infosys) we conclude the following: –  ACN’s $60 billion market valuation price tag is supported by its breadth of experience across industry segments and diversified geographic footprint –  Based on assumed 9.7% WACC and 3% terminal growth, our intrinsic value for ACN shares is $76.1 as compared to the $89.9 stock market price as at 12 January 2015
INDUSTRY OVERVIEW
-6 -4 -2 0 2 4 1Q07 4Q07 3Q08 2Q09 1Q10 4Q10 3Q11 2Q12 1Q13 EU GDP growth (%) EU GDP growth (%) -8 -6 -4 -2 0 2 4 6 8 10 12 2008 2009 2010 2011 2012 2013 Asia Pacific GDP growth (%) India GDP growth (%) China GDP growth (%) Australia GDP growth (%) JapanGDP growth (%)-8 -6 -4 -2 0 2 4 6 US GDP growth (%) US GDP growth (%) Macroeconomic story •  US economy showing signs of improvement- key growth areas in financial and health care •  EU shows a slowly declining GDP growth rate •  APAC expected to grow at CAGR 2.3% through to 2015- growing demand in IT services.
Mixed global picture at corporate level •  The US -showing rising corporate profits, declining unemployment rates and stabilizing manufacturing indices. •  Expecting a continuation of growth in the US. •  Europe still carries an uncertain climate, with flat to rising unemployment and declining manufacturing/consumer confidence. •  APAC sees growth in the demand for IT services and further need of effective business operations. There is further investment in Cloud, mobility, social media and analytics. 0 500 1000 1500 2000 2500 1Q07 4Q07 3Q08 2Q09 1Q10 4Q10 3Q11 2Q12 1Q13 US corporation profits $bn US corporation profits $bn -40 -30 -20 -10 0 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Change in EU consumer confidence Change in EU consumer confidence
Competitive Landscape Communications, media & technology •  IBM •  CSC •  HP (in communications) Financial services •  IBM •  Cognizant •  TCS •  Infosys Products •  IBM •  Infosys •  HCL Tech Resources •  Capgemini •  Atos •  IBM •  TCS •  Wipro •  Infosys Health & public services •  Cognizant •  IBM Competitors to Accenture’s operating groups: Whilst consulting companies such as Bain and Mckinsey are competitors, Accenture’s closet peers utilise similar technologies in their service to assist clients/businesses.
COMPANY CONSIDERATIONS
Key Company Considerations •  Accenture’s revenues are driven by –  macroeconomic conditions –  business confidence –  economic and geopolitical uncertainty –  lower levels of spending •  Growth experienced year over year in: –  Communications, Media & technology (2.7%) –  Products (4.4%) –  Health and public services (10.5%) –  Financial services (5.8%) •  Flat growth experienced year-on-year in: –  Resources (3.1%)
Key Company Considerations •  Revenue growth was strong in Outsourcing and modest in consulting. –  Clients want more outsourcing services with an emphasis on cost savings initiatives •  A weak USD is favourable for Accenture and a strong US dollar is considered unfavourable – exposure to high translation risk for international business •  During fourth quarter fiscal year 2014 - US dollar weakened against other currency which was favourable for Accenture’s P&L.
Accenture Business Model Strategy Digital Technology Operations Accenture Growth Platforms Communications, media & technology • Communication (54%) • Electronic & high tech (35%) • Media/entertainment (11%) Financial services • Banking (51%) • Capital markets (17%) • Insurance (32%) Products • Airfreight/travel services • Automotive • Consumer goods/ services • Industrial equipment • Infrastructure and transportation services • Life sciences • Retail Resources • Chemicals energy (33%) • Natural resources utilities (32%) Health & public services • Public services (69%) • Health (31%) • US federal govt (28%) Accenture is a world leading provider of management consulting, technology and outsourcing services firm. Comprises 4 revenue segments: I.  Strategy II.  Operations III.  Digital IV.  Technology Accenture’s operating groups:
Strategy Strategic business outcomes Digital Engage customers Marketing Analytics Mobility Technology R&D tech labs Manage tech platforms SAP Oracle Microsoft Operations Business process outsourcing Infrastructure outsourcing Consulting Cloud Accenture Growth Platforms Key alliances include: •  Microsoft, SAP and Oracle •  Compliments ACN business model, gain domain knowledge from alliances to better customer service •  ACN’s revenue grows with these companies
How Accenture uses tech to help clients? SMAC stack-:Social media, Mobility, Big data analysts, Cloud ACN offer tech expertise: to help businesses run efficiently/more effectively/reduce costs Help companies achieve strategic objectives ACN interactive: closer interaction with customers, marketing software (ACN digital diagnostics), improves company’s website ACN customer insight solution: help business focus their marketing strategy Manage company’s tech platforms Implement tech: Microsoft, Oracle, SAP
Headline Operational Metrics Sales by Division & Growth (3Yrs) EBIT Growth & Margins (3Yrs)Sales Growth (3Yrs) 2.1 4.9 4.6 0 1 2 3 4 5 6 27000 28000 29000 30000 31000 32000 2013 2014 2015 Revenue (m$) Sales Growth (%) 28,563 30,002 31,396 27,000 28,000 29,000 30,000 31,000 32,000 0 2,000 4,000 6,000 8,000 10,000 2013 2014 2015 Comms, media and tech Financial services Health and public services Products Resources Total net revenue 14 13 13 12.5 13 13.5 14 14.5 4.25 4.3 4.35 4.4 4.45 2013 2014 2015 EBIT (bn$) Margin (%)
Financial Forecasts EBIT & Margin (‘14-’19) Net Income & Profit Margin (‘14-’19)Sales & Growth (‘14-’19) •  The company is forecasted to grow its sales up to 4.9% y-o-y between 2014-2019 •  Cost efficiencies will see EBIT margin expansion to 13% in FY’19 •  This will translate into higher profit margins as capital structure will remain constant 2.1 4.9 4.6 4.7 4.7 4.7 4.8 0   1   2   3   4   5   6   0   5000   10000   15000   20000   25000   30000   35000   40000   2013   2014   2015   2016   2017   2018   2019   Revenue  (m$)   Sales  Growth  (%)   14 13 13 13 13 13 13 12.4   12.6   12.8   13   13.2   13.4   13.6   13.8   14   14.2   0   1   2   3   4   5   6   2013   2014   2015   2016   2017   2018   2019   EBIT  (bn$)   Margin  (%)   12.4   12.6   12.8   13   13.2   13.4   13.6   13.8   14   14.2   0   0.5   1   1.5   2   2.5   3   3.5   4   4.5   2013   2014   2015   2016   2017   2018   2019   Net  Income  (bn$)   Profit  Margin  (%)  
28,563 30,002 31,396 32,863 34,407 36,035 37,749 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 2013 2014 2015 2016 2017 2018 2019 Comms, media and tech (m$) Financial services (m$) Health and Public Services (m$) Products (m$) Resources (m$) Total net revenue (m$) Forecast Sales by Division: (2013-2019)
Key Financial Metrics - Liquidity Payables DaysReceivables Days •  The company overall has good liquidity metrics over the forecast period •  Payables decreases and stabilizes over time •  Receivables days remain stable from 2014 0   5   10   15   20   25   30   35   40   45   50   2013   2014   2015   2016   2017   2018   2019   0   2   4   6   8   10   12   14   16   18   20   2013   2014   2015   2016   2017   2018   2019  
Share Price Performance vs. Competitors (Last 12 Months) 85 95 105 115 125 135 145 20-Dec-13 20-Jan-14 20-Feb-14 20-Mar-14 20-Apr-14 20-May-14 20-Jun-14 20-Jul-14 20-Aug-14 20-Sep-14 20-Oct-14 20-Nov-14 Accenture IBM HP Cognizant Infosys
Acquisition History •  Accenture have acquired five IT consulting services companies over the past 12 months M&A Transaction History Announced Date Target Description February 03, 2014 ClientHouse GmbH IT Consulting & Services Merger/Acquisition March 03, 2014 Evopro IT Consulting & Services Merger/Acquisition May 15, 2014 i4C Analytics Srl IT Consulting & Services Merger/Acquisition June 09, 2014 PureApps Ltd IT Consulting & Services Merger/Acquisition June 10, 2014 Enkitec LP IT Consulting & Services Merger/Acquisition
TRADE IDEA
Valuation Commentary (1) •  Key financial assumptions used in discounted cash flow analysis: –  WACC=9.7% –  Terminal growth rate= 3.0% –  Tax rate= 26% Valuation drivers by division: •  Communications, media & technology: –  expect an increase in CAGR growth through to 2019. ACN have using the SMAC stack ($200bn market). RBC expects it to grow with a CAGR of 15% through to 2017. •  Resources: –  decrease in CAGR. IT spending in this industry, only expected to increase from $332bn to $369bn (2013 to 2017). •  Financial services: –  expecting an increase in CAGR, IT outsourcing is increasing, pressure for financial institutions to automate services •  Health & public services: –  major CAGR increase promoted by RBC for 2015 by 10.5%. Healthcare institutions are moving into IT outsourcing, CAGR will lower eventually after initial peak. •  Products: –  uncertainty in the global economy caused revenue pressures/rising costs (triggered more outsourcing) resulting in a slight increase in CAGR.
•  Decrease in CAGR growth from the Americas: –  trend in the stronger US dollar adversely affect revenues for ACN –  Troubles in Europe have caused the consulting business to suffer •  CAGR growth for consulting reduced: –  consulting has troughed, however may pick up with the economy –  Outsourcing has increased, due to the trend in companies wanting cost savings initiatives from ACN Valuation Commentary (2)
Discounted Cash Flow Analysis Financial Year (Dec. Year end) 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Terminal Period Total Turnover 32 33 35 37 38 40   growth (%) 4.6% 4.7% 4.7% 4.7% 4.8%       EBIT 4 4 5 5 5 5   margin (%) 13.5% 13.2% 13.2% 13.2% 13.2% 13.2%       Depreciation & Amortisation 0.6 0.6 0.4 0.4 0.4 0.4       Tax @ 26.1% (1.1) (1.1) (1.2) (1.3) (1.3) (1.4)   Capital Expenditure 0.3 0.3 0.3 0.4 0.4 0.4   Capex/Sales (%) -1.0% -1.0% -1.0% -1.0% -1.0% -1.0%       Change in Working Capital 0.0 (2.9) (0.1) (0.1) (0.1) (0.1)   Working Capital / Sales (%) 0.0% 8.7% 0.2% 0.2% 0.2% 0.2%       Free Cash Flow 3 1 3 3 4 4 4     Discount Factor 0.91 0.83 0.76 0.69 0.63 0.63     Terminal Value 59     Present Value 0.6 2.8 2.6 2.5 2.4 37 Enterprise Value 48   Net Debt as at (August 2014) -4.897174   Market Capitalisation ($bn) 53   No. Shares (m) 0.692   Share Price ($) 76.1            
Relative Valuation- Trading Competitors Accenture IBM Cognizant Infosys HP Market Cap ($m) 57,379 151,280 31,189 35,056 72,569 Total Debt ($m) 26.7 39,718.0 0.0 0.0 19,525.0 Cash & Cash Equivalents ($m) 4,921.3 10,716.0 2,213.0 0.0 15,133.0 Net debt ($m) -4,894.6 29,002.0 -2,213.0 0.0 4,392.0 Enterprise Value ($m) 52,485 180,282 28,976 35,056 76,961 Sales ($m) 31,875 99,751 8,843 8,249 111,454 EBIT ($m) 4,301 19,524 1,678 1,979 7,185 Depreciation & Amortisation 620.7 3,327.0 179.9 226.0 4,334.0 EBITDA 4,921.3 22,851.0 1,857.8 2,205.0 11,519.0 EPS 4.3 15.9 2.3 1.7 2.6 Share Price ($) 89.7 157.6 53.5 32.6 39.8 Average Median EV/Sales 1.65x 1.81x 3.28x 4.25x 0.69x 2.33x 1.81x EV/EBITDA 10.66x 7.89x 15.60x 15.90x 6.68x 11.35x 10.66x P/E 21.12x 9.89x 23.34x 19.15x 15.20x 17.74x 19.15x
Valuation Summary 20 20 95 60 115 115 33 105 65 124 124 0 50 100 150 200 250 300 EV/Sales - Trading EV/EBITDA - Trading EV/EBIT - Trading DCF EV/Sales - Transaction EV/EBITDA - Transaction
APPENDIX
Income Statement Accenture Hist. Hist. Hist Proj. Proj. Proj. Proj. Proj. Income Statement 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Net Sales 29.8 30.4 31.9 33.3 34.9 36.5 38.3 40.1 COGS 20.8 21.0 22.2 23.3 24.4 25.5 26.7 28.0 SG&A 5.116 5.045 5.384 5.7 5.9 6.2 6.5 6.8 EBIT 3.872 4.339 4.301 4.4 4.6 4.8 5.1 5.3 Depreciation & Amortization 0.6 0.593 0.621 0.6 0.4 0.4 0.4 0.4 0.0 0.0 0.0 0.0 0.0 EBITDA 4.5 4.9 4.9 5.0 5.0 5.2 5.4 5.7 Non-recurring items 0.0 0.0 0.0 0.0 0.0 Interest Income 0.043 0.033 0.030 0.1 0.1 0.1 0.1 0.2 Interest Expense 0.015 0.014 0.018 0.0 0.0 0.0 0.0 0.0 Profit before taxes 3.9 4.4 4.3 4.5 4.7 4.9 5.2 5.5 Taxes 1.079 0.785 1.122 1.2 1.2 1.3 1.4 1.4 Profit after tax 2.820 3.573 3.192 3.3 3.5 3.7 3.8 4.1 Net income 2.820 3.573 3.192 3.3 3.5 3.7 3.8 4.1
Balance Sheet Accenture Hist. Hist. Hist. Proj. Proj. Proj. Proj. Proj. Balance Sheet 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Assets Current assets Cash and cash equivalents   5.634 4.924 5.8 9.2 12.8 16.5 20.4 Accounts receivable   3.333 3.860 3.3 3.5 3.7 3.8 4.0 Prepaid expenses / Unbilled   1.513 1.804 1.9 1.9 2.0 2.1 2.2 Other current assets   0.568 0.585 0.7 0.7 0.7 0.8 0.8 Deferred income taxes   0.795 0.732 0.7 0.7 0.7 0.8 0.8 Total current assets 0.000 11.844 11.904 12.363 16.084 19.949 24.007 28.286 Non-current assets Net PP&E   0.780 0.793 0.5 0.4 0.5 0.5 0.5 Goodwill   1.819 2.396 2.4 2.4 2.4 2.4 2.4 Deferred Income taxes and contracts   1.573 1.782 1.8 1.8 1.8 1.8 1.8 Other assets   0.851 1.055 1.0 1.0 1.1 1.1 1.2 Total assets 0.000 16.867 17.930 18.035 21.758 25.679 29.808 34.164 Liabilities Current liabilities Short term debt   0.000 0.000 0.0 0.0 0.0 0.0 0.0 Accounts payable and accruals   0.962 1.064 0.7 0.7 0.8 0.8 0.8 Accrued expenses   3.460 3.381 0.1 0.1 0.1 0.1 0.1 Deferred Revenues   2.231 2.348 2.7 2.8 2.9 3.1 3.2 Other liabilities   1.508 1.365 1.3 1.4 1.5 1.5 1.6 Total current liabilities 0.000 8.161 8.158 4.8 5.0 5.3 5.5 5.8 Non-current liabilities Total long-term debt   0.026 0.026 0.0 0.0 0.0 0.0 0.0 Deferred Revenues   0.517 0.545 0.5 0.5 0.5 0.5 0.5 Retirement Obligation   0.873 1.108 1.1 1.1 1.1 1.1 1.1 Income taxes payables   1.224 1.303 1.3 1.3 1.3 1.3 1.3 Other long-term liabilities   0.638 0.505 0.7 0.7 0.7 0.8 0.8 Total liabilities 0.000 11.439 11.645 8.4 8.7 9.0 9.2 9.5 Equity Common stock   3.3 4.3 4.3 4.3 4.3 4.3 4.3 Retained earnings   9.5 11.4 14.7 18.2 21.9 25.7 29.8 Treasury stock 0.0 (7.3) (9.4) (9.4) (9.4) (9.4) (9.4) (9.4) Total equity 0.0 5.4 6.3 9.6 13.0 16.7 20.5 24.6 Total Liab.& Equity 0.0 16.9 17.9 18.0 21.7 25.7 29.8 34.1 Balance? OK (0.0) (0.0) (0.0) (0.0) (0.0) (0.0) (0.0)
Cashflow Statement Accenture   Hist. Hist. Hist. Proj. Proj. Proj. Proj. Proj. Cash Flow Statement 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Net Income 3.3 3.5 3.7 3.8 4.1 Depreciation 0.6 0.4 0.4 0.4 0.4 Amortisation 0.0 0.0 0.0 0.0 0.0 Change in OWC (2.9) (0.1) (0.1) (0.1) (0.1) Change in other assets 0.1 (0.0) (0.0) (0.1) (0.1) Change in other liabilities 0.2 0.0 0.0 0.0 0.0 Cash from Operating Activities 1.2 3.8 3.9 4.1 4.3 Capex 0.3 0.3 0.4 0.4 0.4 Cash from Investing Activities -0.3 -0.3 -0.4 -0.4 -0.4 Change in Common Stock 0.0 0.0 0.0 0.0 0.0 Change in Treasury Stock 0.0 0.0 0.0 0.0 0.0 Dividends 0.0 0.0 0.0 0.0 0.0 Long Term Debt Repayment 0.0 0.0 0.0 0.0 0.0 Cash from Financing Activities 0.0 0.0 0.0 0.0 0.0 Net Cash Flow 0.9 3.4 3.5 3.7 3.9 Beginning Cash 4.9 5.8 9.2 12.8 16.5 Ending Cash 4.9 5.8 9.2 12.8 16.5 20.4
Revenue forecasts Operating groups CAGR growth years 13 to 15 Expected (RBC) (%) CAGR growth 13 to 14 Actual (%) Forecast CAGR growth 15 to 19 (%) 2013 A (m $) 2014 A (m$) 2015 E (m$) 2016 E (m$) 2017 E (m$) 2018 E (m$) 2019 E (m$) communications media and technology 2.70% 4.2% 3.5% 5,686 5,924 6,131 6,346 6,568 6,798 7,036 financial services 5.80% 5.6% 5.0% 6,166 6,511 6,837 7,178 7,537 7,914 8,310 Health and public services 10.50% 6.0% 8.0% 4,739 5,022 5,424 5,858 6,326 6,832 7,379 Products 4.40% 8.6% 4.4% 6,807 7,395 7,720 8,060 8,415 8,785 9,172 Resources 3.10% -0.2% 2.6% 5,143 5,135 5,269 5,405 5,546 5,690 5,838 Other - -31.8% 0.0% 22 15 15 15 15 15 15 Total net revenue   5.0% n/a 28,563 30,002 31,396 32,863 34,407 36,035 37,749 Total sales growth (%) 5.0% 4.6% 4.7% 4.7% 4.7% 4.8% Geographic regions 2013 A (m$) 2014 A (m$) % SPLIT % SPLIT Americas 13519 14201 47.3% 47.3% EMEA 11047 11915 38.7% 39.7% Asia Pacific 3997 3886 14.0% 13.0% Total net revenue 28563 30002 Work Type 2013 A (m$) 2014 A (m$) % SPLIT % SPLIT Consulting 15383 15738 53.9% 52.5% Outsourcing 13179 14265 46.1% 47.5% Total net revenue 28563 30002
Financial Assumptions Accenture Hist. Hist. Hist. Proj. Proj. Proj. Proj. Proj. Financial Assumptions 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Income statement Sales growth % 2.1% 4.9% 4.6% 4.7% 4.7% 4.7% 4.8% COGS as % of sales 69.8% 69.1% 69.6% 69.8% 69.8% 69.8% 69.8% 69.8% Annual depr. as % of previous PPE 79.6% 79.8% 79.8% 79.8% 79.8% 79.8% SG&A as % of sales 17.2% 16.6% 16.9% 17.0% 17.0% 17.0% 17.0% 17.0% Amortization of other intangibles amount 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Non-recurring items amount 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Effective tax rate 18.1% 26.1% 26.0% 26.0% 26.0% 26.0% 26.0% Shareholder info Diluted weighted average shares outstanding (m) 0.727 0.713 0.692 0.692 0.692 0.692 0.692 0.692 Dividend per share growth rate 0.0% 0.0% 0.0% 0.0% 0.0% Balance sheet: current assets Accounts receivable as % of sales 0.0% 11.0% 12.1% 10.0% 10.0% 10.0% 10.0% 10.0% Inventories % of COGS 0.0% 7.2% 8.1% 8.0% 8.0% 8.0% 8.0% 8.0% Other current assets % of sales 0.0% 1.9% 1.8% 2.0% 2.0% 2.0% 2.0% 2.0% Deferred income taxes % of sales 2.6% 2.3% 2.0% 2.0% 2.0% 2.0% 2.0% Other Liabilities % of sales 5.0% 4.3% 4.0% 4.0% 4.0% 4.0% 4.0% Balance sheet: non-current assets Capital expenditures % of sales 1.2% 1.2% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% Other assets % of sales 0.0% 2.8% 3.3% 3.0% 3.0% 3.0% 3.0% 3.0% Balance sheet: liabilities Accounts payable and accruals % of COGS 3.2% 3.3% 3.0% 3.0% 3.0% 3.0% 3.0% Accrued expenses as % sales 10.4% 9.7% 9.0% 9.0% 9.0% 9.0% 9.0% Deferred Revenues as % of sales 7.3% 7.4% 8.0% 8.0% 8.0% 8.0% 8.0% Deferred Revenues 0.545 0.545 0.545 0.545 0.545 Retirement Obligation 1.108 1.108 1.108 1.108 1.108 Income taxes payables 1.303 1.303 1.303 1.303 1.303 Other long-term liabilities % of sales 0.0% 2.1% 1.6% 2.0% 2.0% 2.0% 2.0% 2.0% Balance sheet: equity Common stock amount 0.0 3.3 4.3 4.3 4.3 4.3 4.3 4.3 Share repurchases $ amount (show as positive) 7.3 2.1 0.0 0.0 0.0 0.0 0.0 Debt (£/$ amount) Loans due for repayment 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other long-term debt repayment 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Interest Rate (%) Short term debt 0.00% 0.00% 0.00% 0.00% 0.00% Loans due for repayment 0.00% 0.00% 0.00% 0.00% 0.00% Other long-term debt repayment 0.00% 0.00% 0.00% 0.00% 0.00% Cash 1.00% 1.00% 1.00% 1.00% 1.00%
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BlueBook Accenture Presentation - Ritesh Patel

  • 1.
    WHY IS ACCENTUREONE OF THE WORLD’S MOST VALUABLE BRANDS?
  • 2.
    Table of Contents • Executive Summary •  Industry Overview •  Company Considerations –  Share Price Performance –  Acquisition History –  Operating Performance –  Valuation •  Trade Idea •  Appendix
  • 3.
    Executive Summary •  Thisproject considers why Accenture (NYSE:ACN) is a valuable global brand from an investors point of view •  ACN is a global provider of consulting, technology and outsourcing services with operations in the Americas (47%), EMEA (40%) and APAC (13%) •  ACN has experienced positive revenue growth in past years and is forecasted to continue this trend annually, due to the following business initiatives: –  Outsourcing business witnessing higher growth in contrast to declines in its consulting arm –  SMAC stack (social media, big data analytics, cloud) •  Pressure for financial institutions to automate services –  Acquisitions (increasing domain knowledge) –  Revenue increases alongside alliances (SAP, Oracle, Microsoft) –  Trend in cost saving initiatives have increased demand for ACN outsourcing services •  Healthcare shifting into IT outsourcing •  ACN has shown it is still very profitable even under adverse economic conditions/within a very competitive environment: –  Strong US dollar, reducing ACN revenue (high translation risk for their international business). –  Trouble in Europe, reducing demand for their consulting businesses •  Based on our forecasts for (FY2015-19), applying discounted cash flow and comparable trading multiples analyses of ACN’s closest competitors (IBM, Cognizant, HP, Infosys) we conclude the following: –  ACN’s $60 billion market valuation price tag is supported by its breadth of experience across industry segments and diversified geographic footprint –  Based on assumed 9.7% WACC and 3% terminal growth, our intrinsic value for ACN shares is $76.1 as compared to the $89.9 stock market price as at 12 January 2015
  • 4.
  • 5.
    -6 -4 -2 0 2 4 1Q07 4Q07 3Q082Q09 1Q10 4Q10 3Q11 2Q12 1Q13 EU GDP growth (%) EU GDP growth (%) -8 -6 -4 -2 0 2 4 6 8 10 12 2008 2009 2010 2011 2012 2013 Asia Pacific GDP growth (%) India GDP growth (%) China GDP growth (%) Australia GDP growth (%) JapanGDP growth (%)-8 -6 -4 -2 0 2 4 6 US GDP growth (%) US GDP growth (%) Macroeconomic story •  US economy showing signs of improvement- key growth areas in financial and health care •  EU shows a slowly declining GDP growth rate •  APAC expected to grow at CAGR 2.3% through to 2015- growing demand in IT services.
  • 6.
    Mixed global pictureat corporate level •  The US -showing rising corporate profits, declining unemployment rates and stabilizing manufacturing indices. •  Expecting a continuation of growth in the US. •  Europe still carries an uncertain climate, with flat to rising unemployment and declining manufacturing/consumer confidence. •  APAC sees growth in the demand for IT services and further need of effective business operations. There is further investment in Cloud, mobility, social media and analytics. 0 500 1000 1500 2000 2500 1Q07 4Q07 3Q08 2Q09 1Q10 4Q10 3Q11 2Q12 1Q13 US corporation profits $bn US corporation profits $bn -40 -30 -20 -10 0 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Change in EU consumer confidence Change in EU consumer confidence
  • 7.
    Competitive Landscape Communications, media &technology •  IBM •  CSC •  HP (in communications) Financial services •  IBM •  Cognizant •  TCS •  Infosys Products •  IBM •  Infosys •  HCL Tech Resources •  Capgemini •  Atos •  IBM •  TCS •  Wipro •  Infosys Health & public services •  Cognizant •  IBM Competitors to Accenture’s operating groups: Whilst consulting companies such as Bain and Mckinsey are competitors, Accenture’s closet peers utilise similar technologies in their service to assist clients/businesses.
  • 8.
  • 9.
    Key Company Considerations • Accenture’s revenues are driven by –  macroeconomic conditions –  business confidence –  economic and geopolitical uncertainty –  lower levels of spending •  Growth experienced year over year in: –  Communications, Media & technology (2.7%) –  Products (4.4%) –  Health and public services (10.5%) –  Financial services (5.8%) •  Flat growth experienced year-on-year in: –  Resources (3.1%)
  • 10.
    Key Company Considerations • Revenue growth was strong in Outsourcing and modest in consulting. –  Clients want more outsourcing services with an emphasis on cost savings initiatives •  A weak USD is favourable for Accenture and a strong US dollar is considered unfavourable – exposure to high translation risk for international business •  During fourth quarter fiscal year 2014 - US dollar weakened against other currency which was favourable for Accenture’s P&L.
  • 11.
    Accenture Business Model StrategyDigital Technology Operations Accenture Growth Platforms Communications, media & technology • Communication (54%) • Electronic & high tech (35%) • Media/entertainment (11%) Financial services • Banking (51%) • Capital markets (17%) • Insurance (32%) Products • Airfreight/travel services • Automotive • Consumer goods/ services • Industrial equipment • Infrastructure and transportation services • Life sciences • Retail Resources • Chemicals energy (33%) • Natural resources utilities (32%) Health & public services • Public services (69%) • Health (31%) • US federal govt (28%) Accenture is a world leading provider of management consulting, technology and outsourcing services firm. Comprises 4 revenue segments: I.  Strategy II.  Operations III.  Digital IV.  Technology Accenture’s operating groups:
  • 12.
    Strategy Strategic business outcomes Digital Engagecustomers Marketing Analytics Mobility Technology R&D tech labs Manage tech platforms SAP Oracle Microsoft Operations Business process outsourcing Infrastructure outsourcing Consulting Cloud Accenture Growth Platforms Key alliances include: •  Microsoft, SAP and Oracle •  Compliments ACN business model, gain domain knowledge from alliances to better customer service •  ACN’s revenue grows with these companies
  • 13.
    How Accenture uses tech to helpclients? SMAC stack-:Social media, Mobility, Big data analysts, Cloud ACN offer tech expertise: to help businesses run efficiently/more effectively/reduce costs Help companies achieve strategic objectives ACN interactive: closer interaction with customers, marketing software (ACN digital diagnostics), improves company’s website ACN customer insight solution: help business focus their marketing strategy Manage company’s tech platforms Implement tech: Microsoft, Oracle, SAP
  • 14.
    Headline Operational Metrics Salesby Division & Growth (3Yrs) EBIT Growth & Margins (3Yrs)Sales Growth (3Yrs) 2.1 4.9 4.6 0 1 2 3 4 5 6 27000 28000 29000 30000 31000 32000 2013 2014 2015 Revenue (m$) Sales Growth (%) 28,563 30,002 31,396 27,000 28,000 29,000 30,000 31,000 32,000 0 2,000 4,000 6,000 8,000 10,000 2013 2014 2015 Comms, media and tech Financial services Health and public services Products Resources Total net revenue 14 13 13 12.5 13 13.5 14 14.5 4.25 4.3 4.35 4.4 4.45 2013 2014 2015 EBIT (bn$) Margin (%)
  • 15.
    Financial Forecasts EBIT &Margin (‘14-’19) Net Income & Profit Margin (‘14-’19)Sales & Growth (‘14-’19) •  The company is forecasted to grow its sales up to 4.9% y-o-y between 2014-2019 •  Cost efficiencies will see EBIT margin expansion to 13% in FY’19 •  This will translate into higher profit margins as capital structure will remain constant 2.1 4.9 4.6 4.7 4.7 4.7 4.8 0   1   2   3   4   5   6   0   5000   10000   15000   20000   25000   30000   35000   40000   2013   2014   2015   2016   2017   2018   2019   Revenue  (m$)   Sales  Growth  (%)   14 13 13 13 13 13 13 12.4   12.6   12.8   13   13.2   13.4   13.6   13.8   14   14.2   0   1   2   3   4   5   6   2013   2014   2015   2016   2017   2018   2019   EBIT  (bn$)   Margin  (%)   12.4   12.6   12.8   13   13.2   13.4   13.6   13.8   14   14.2   0   0.5   1   1.5   2   2.5   3   3.5   4   4.5   2013   2014   2015   2016   2017   2018   2019   Net  Income  (bn$)   Profit  Margin  (%)  
  • 16.
    28,563 30,002 31,396 32,863 34,407 36,035 37,749 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 2013 2014 20152016 2017 2018 2019 Comms, media and tech (m$) Financial services (m$) Health and Public Services (m$) Products (m$) Resources (m$) Total net revenue (m$) Forecast Sales by Division: (2013-2019)
  • 17.
    Key Financial Metrics- Liquidity Payables DaysReceivables Days •  The company overall has good liquidity metrics over the forecast period •  Payables decreases and stabilizes over time •  Receivables days remain stable from 2014 0   5   10   15   20   25   30   35   40   45   50   2013   2014   2015   2016   2017   2018   2019   0   2   4   6   8   10   12   14   16   18   20   2013   2014   2015   2016   2017   2018   2019  
  • 18.
    Share Price Performancevs. Competitors (Last 12 Months) 85 95 105 115 125 135 145 20-Dec-13 20-Jan-14 20-Feb-14 20-Mar-14 20-Apr-14 20-May-14 20-Jun-14 20-Jul-14 20-Aug-14 20-Sep-14 20-Oct-14 20-Nov-14 Accenture IBM HP Cognizant Infosys
  • 19.
    Acquisition History •  Accenturehave acquired five IT consulting services companies over the past 12 months M&A Transaction History Announced Date Target Description February 03, 2014 ClientHouse GmbH IT Consulting & Services Merger/Acquisition March 03, 2014 Evopro IT Consulting & Services Merger/Acquisition May 15, 2014 i4C Analytics Srl IT Consulting & Services Merger/Acquisition June 09, 2014 PureApps Ltd IT Consulting & Services Merger/Acquisition June 10, 2014 Enkitec LP IT Consulting & Services Merger/Acquisition
  • 20.
  • 21.
    Valuation Commentary (1) • Key financial assumptions used in discounted cash flow analysis: –  WACC=9.7% –  Terminal growth rate= 3.0% –  Tax rate= 26% Valuation drivers by division: •  Communications, media & technology: –  expect an increase in CAGR growth through to 2019. ACN have using the SMAC stack ($200bn market). RBC expects it to grow with a CAGR of 15% through to 2017. •  Resources: –  decrease in CAGR. IT spending in this industry, only expected to increase from $332bn to $369bn (2013 to 2017). •  Financial services: –  expecting an increase in CAGR, IT outsourcing is increasing, pressure for financial institutions to automate services •  Health & public services: –  major CAGR increase promoted by RBC for 2015 by 10.5%. Healthcare institutions are moving into IT outsourcing, CAGR will lower eventually after initial peak. •  Products: –  uncertainty in the global economy caused revenue pressures/rising costs (triggered more outsourcing) resulting in a slight increase in CAGR.
  • 22.
    •  Decrease inCAGR growth from the Americas: –  trend in the stronger US dollar adversely affect revenues for ACN –  Troubles in Europe have caused the consulting business to suffer •  CAGR growth for consulting reduced: –  consulting has troughed, however may pick up with the economy –  Outsourcing has increased, due to the trend in companies wanting cost savings initiatives from ACN Valuation Commentary (2)
  • 23.
    Discounted Cash FlowAnalysis Financial Year (Dec. Year end) 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Terminal Period Total Turnover 32 33 35 37 38 40   growth (%) 4.6% 4.7% 4.7% 4.7% 4.8%       EBIT 4 4 5 5 5 5   margin (%) 13.5% 13.2% 13.2% 13.2% 13.2% 13.2%       Depreciation & Amortisation 0.6 0.6 0.4 0.4 0.4 0.4       Tax @ 26.1% (1.1) (1.1) (1.2) (1.3) (1.3) (1.4)   Capital Expenditure 0.3 0.3 0.3 0.4 0.4 0.4   Capex/Sales (%) -1.0% -1.0% -1.0% -1.0% -1.0% -1.0%       Change in Working Capital 0.0 (2.9) (0.1) (0.1) (0.1) (0.1)   Working Capital / Sales (%) 0.0% 8.7% 0.2% 0.2% 0.2% 0.2%       Free Cash Flow 3 1 3 3 4 4 4     Discount Factor 0.91 0.83 0.76 0.69 0.63 0.63     Terminal Value 59     Present Value 0.6 2.8 2.6 2.5 2.4 37 Enterprise Value 48   Net Debt as at (August 2014) -4.897174   Market Capitalisation ($bn) 53   No. Shares (m) 0.692   Share Price ($) 76.1            
  • 24.
    Relative Valuation- Trading CompetitorsAccenture IBM Cognizant Infosys HP Market Cap ($m) 57,379 151,280 31,189 35,056 72,569 Total Debt ($m) 26.7 39,718.0 0.0 0.0 19,525.0 Cash & Cash Equivalents ($m) 4,921.3 10,716.0 2,213.0 0.0 15,133.0 Net debt ($m) -4,894.6 29,002.0 -2,213.0 0.0 4,392.0 Enterprise Value ($m) 52,485 180,282 28,976 35,056 76,961 Sales ($m) 31,875 99,751 8,843 8,249 111,454 EBIT ($m) 4,301 19,524 1,678 1,979 7,185 Depreciation & Amortisation 620.7 3,327.0 179.9 226.0 4,334.0 EBITDA 4,921.3 22,851.0 1,857.8 2,205.0 11,519.0 EPS 4.3 15.9 2.3 1.7 2.6 Share Price ($) 89.7 157.6 53.5 32.6 39.8 Average Median EV/Sales 1.65x 1.81x 3.28x 4.25x 0.69x 2.33x 1.81x EV/EBITDA 10.66x 7.89x 15.60x 15.90x 6.68x 11.35x 10.66x P/E 21.12x 9.89x 23.34x 19.15x 15.20x 17.74x 19.15x
  • 25.
    Valuation Summary 20 20 95 60 115 115 33 105 65 124 124 0 50100 150 200 250 300 EV/Sales - Trading EV/EBITDA - Trading EV/EBIT - Trading DCF EV/Sales - Transaction EV/EBITDA - Transaction
  • 26.
  • 27.
    Income Statement Accenture Hist.Hist. Hist Proj. Proj. Proj. Proj. Proj. Income Statement 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Net Sales 29.8 30.4 31.9 33.3 34.9 36.5 38.3 40.1 COGS 20.8 21.0 22.2 23.3 24.4 25.5 26.7 28.0 SG&A 5.116 5.045 5.384 5.7 5.9 6.2 6.5 6.8 EBIT 3.872 4.339 4.301 4.4 4.6 4.8 5.1 5.3 Depreciation & Amortization 0.6 0.593 0.621 0.6 0.4 0.4 0.4 0.4 0.0 0.0 0.0 0.0 0.0 EBITDA 4.5 4.9 4.9 5.0 5.0 5.2 5.4 5.7 Non-recurring items 0.0 0.0 0.0 0.0 0.0 Interest Income 0.043 0.033 0.030 0.1 0.1 0.1 0.1 0.2 Interest Expense 0.015 0.014 0.018 0.0 0.0 0.0 0.0 0.0 Profit before taxes 3.9 4.4 4.3 4.5 4.7 4.9 5.2 5.5 Taxes 1.079 0.785 1.122 1.2 1.2 1.3 1.4 1.4 Profit after tax 2.820 3.573 3.192 3.3 3.5 3.7 3.8 4.1 Net income 2.820 3.573 3.192 3.3 3.5 3.7 3.8 4.1
  • 28.
    Balance Sheet Accenture Hist.Hist. Hist. Proj. Proj. Proj. Proj. Proj. Balance Sheet 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Assets Current assets Cash and cash equivalents   5.634 4.924 5.8 9.2 12.8 16.5 20.4 Accounts receivable   3.333 3.860 3.3 3.5 3.7 3.8 4.0 Prepaid expenses / Unbilled   1.513 1.804 1.9 1.9 2.0 2.1 2.2 Other current assets   0.568 0.585 0.7 0.7 0.7 0.8 0.8 Deferred income taxes   0.795 0.732 0.7 0.7 0.7 0.8 0.8 Total current assets 0.000 11.844 11.904 12.363 16.084 19.949 24.007 28.286 Non-current assets Net PP&E   0.780 0.793 0.5 0.4 0.5 0.5 0.5 Goodwill   1.819 2.396 2.4 2.4 2.4 2.4 2.4 Deferred Income taxes and contracts   1.573 1.782 1.8 1.8 1.8 1.8 1.8 Other assets   0.851 1.055 1.0 1.0 1.1 1.1 1.2 Total assets 0.000 16.867 17.930 18.035 21.758 25.679 29.808 34.164 Liabilities Current liabilities Short term debt   0.000 0.000 0.0 0.0 0.0 0.0 0.0 Accounts payable and accruals   0.962 1.064 0.7 0.7 0.8 0.8 0.8 Accrued expenses   3.460 3.381 0.1 0.1 0.1 0.1 0.1 Deferred Revenues   2.231 2.348 2.7 2.8 2.9 3.1 3.2 Other liabilities   1.508 1.365 1.3 1.4 1.5 1.5 1.6 Total current liabilities 0.000 8.161 8.158 4.8 5.0 5.3 5.5 5.8 Non-current liabilities Total long-term debt   0.026 0.026 0.0 0.0 0.0 0.0 0.0 Deferred Revenues   0.517 0.545 0.5 0.5 0.5 0.5 0.5 Retirement Obligation   0.873 1.108 1.1 1.1 1.1 1.1 1.1 Income taxes payables   1.224 1.303 1.3 1.3 1.3 1.3 1.3 Other long-term liabilities   0.638 0.505 0.7 0.7 0.7 0.8 0.8 Total liabilities 0.000 11.439 11.645 8.4 8.7 9.0 9.2 9.5 Equity Common stock   3.3 4.3 4.3 4.3 4.3 4.3 4.3 Retained earnings   9.5 11.4 14.7 18.2 21.9 25.7 29.8 Treasury stock 0.0 (7.3) (9.4) (9.4) (9.4) (9.4) (9.4) (9.4) Total equity 0.0 5.4 6.3 9.6 13.0 16.7 20.5 24.6 Total Liab.& Equity 0.0 16.9 17.9 18.0 21.7 25.7 29.8 34.1 Balance? OK (0.0) (0.0) (0.0) (0.0) (0.0) (0.0) (0.0)
  • 29.
    Cashflow Statement Accenture  Hist. Hist. Hist. Proj. Proj. Proj. Proj. Proj. Cash Flow Statement 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Net Income 3.3 3.5 3.7 3.8 4.1 Depreciation 0.6 0.4 0.4 0.4 0.4 Amortisation 0.0 0.0 0.0 0.0 0.0 Change in OWC (2.9) (0.1) (0.1) (0.1) (0.1) Change in other assets 0.1 (0.0) (0.0) (0.1) (0.1) Change in other liabilities 0.2 0.0 0.0 0.0 0.0 Cash from Operating Activities 1.2 3.8 3.9 4.1 4.3 Capex 0.3 0.3 0.4 0.4 0.4 Cash from Investing Activities -0.3 -0.3 -0.4 -0.4 -0.4 Change in Common Stock 0.0 0.0 0.0 0.0 0.0 Change in Treasury Stock 0.0 0.0 0.0 0.0 0.0 Dividends 0.0 0.0 0.0 0.0 0.0 Long Term Debt Repayment 0.0 0.0 0.0 0.0 0.0 Cash from Financing Activities 0.0 0.0 0.0 0.0 0.0 Net Cash Flow 0.9 3.4 3.5 3.7 3.9 Beginning Cash 4.9 5.8 9.2 12.8 16.5 Ending Cash 4.9 5.8 9.2 12.8 16.5 20.4
  • 30.
    Revenue forecasts Operating groups CAGRgrowth years 13 to 15 Expected (RBC) (%) CAGR growth 13 to 14 Actual (%) Forecast CAGR growth 15 to 19 (%) 2013 A (m $) 2014 A (m$) 2015 E (m$) 2016 E (m$) 2017 E (m$) 2018 E (m$) 2019 E (m$) communications media and technology 2.70% 4.2% 3.5% 5,686 5,924 6,131 6,346 6,568 6,798 7,036 financial services 5.80% 5.6% 5.0% 6,166 6,511 6,837 7,178 7,537 7,914 8,310 Health and public services 10.50% 6.0% 8.0% 4,739 5,022 5,424 5,858 6,326 6,832 7,379 Products 4.40% 8.6% 4.4% 6,807 7,395 7,720 8,060 8,415 8,785 9,172 Resources 3.10% -0.2% 2.6% 5,143 5,135 5,269 5,405 5,546 5,690 5,838 Other - -31.8% 0.0% 22 15 15 15 15 15 15 Total net revenue   5.0% n/a 28,563 30,002 31,396 32,863 34,407 36,035 37,749 Total sales growth (%) 5.0% 4.6% 4.7% 4.7% 4.7% 4.8% Geographic regions 2013 A (m$) 2014 A (m$) % SPLIT % SPLIT Americas 13519 14201 47.3% 47.3% EMEA 11047 11915 38.7% 39.7% Asia Pacific 3997 3886 14.0% 13.0% Total net revenue 28563 30002 Work Type 2013 A (m$) 2014 A (m$) % SPLIT % SPLIT Consulting 15383 15738 53.9% 52.5% Outsourcing 13179 14265 46.1% 47.5% Total net revenue 28563 30002
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    Financial Assumptions Accenture Hist.Hist. Hist. Proj. Proj. Proj. Proj. Proj. Financial Assumptions 31-Aug-12 31-Aug-13 31-Aug-14 31-Aug-15 31-Aug-16 31-Aug-17 31-Aug-18 31-Aug-19 Income statement Sales growth % 2.1% 4.9% 4.6% 4.7% 4.7% 4.7% 4.8% COGS as % of sales 69.8% 69.1% 69.6% 69.8% 69.8% 69.8% 69.8% 69.8% Annual depr. as % of previous PPE 79.6% 79.8% 79.8% 79.8% 79.8% 79.8% SG&A as % of sales 17.2% 16.6% 16.9% 17.0% 17.0% 17.0% 17.0% 17.0% Amortization of other intangibles amount 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Non-recurring items amount 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Effective tax rate 18.1% 26.1% 26.0% 26.0% 26.0% 26.0% 26.0% Shareholder info Diluted weighted average shares outstanding (m) 0.727 0.713 0.692 0.692 0.692 0.692 0.692 0.692 Dividend per share growth rate 0.0% 0.0% 0.0% 0.0% 0.0% Balance sheet: current assets Accounts receivable as % of sales 0.0% 11.0% 12.1% 10.0% 10.0% 10.0% 10.0% 10.0% Inventories % of COGS 0.0% 7.2% 8.1% 8.0% 8.0% 8.0% 8.0% 8.0% Other current assets % of sales 0.0% 1.9% 1.8% 2.0% 2.0% 2.0% 2.0% 2.0% Deferred income taxes % of sales 2.6% 2.3% 2.0% 2.0% 2.0% 2.0% 2.0% Other Liabilities % of sales 5.0% 4.3% 4.0% 4.0% 4.0% 4.0% 4.0% Balance sheet: non-current assets Capital expenditures % of sales 1.2% 1.2% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% Other assets % of sales 0.0% 2.8% 3.3% 3.0% 3.0% 3.0% 3.0% 3.0% Balance sheet: liabilities Accounts payable and accruals % of COGS 3.2% 3.3% 3.0% 3.0% 3.0% 3.0% 3.0% Accrued expenses as % sales 10.4% 9.7% 9.0% 9.0% 9.0% 9.0% 9.0% Deferred Revenues as % of sales 7.3% 7.4% 8.0% 8.0% 8.0% 8.0% 8.0% Deferred Revenues 0.545 0.545 0.545 0.545 0.545 Retirement Obligation 1.108 1.108 1.108 1.108 1.108 Income taxes payables 1.303 1.303 1.303 1.303 1.303 Other long-term liabilities % of sales 0.0% 2.1% 1.6% 2.0% 2.0% 2.0% 2.0% 2.0% Balance sheet: equity Common stock amount 0.0 3.3 4.3 4.3 4.3 4.3 4.3 4.3 Share repurchases $ amount (show as positive) 7.3 2.1 0.0 0.0 0.0 0.0 0.0 Debt (£/$ amount) Loans due for repayment 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other long-term debt repayment 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Interest Rate (%) Short term debt 0.00% 0.00% 0.00% 0.00% 0.00% Loans due for repayment 0.00% 0.00% 0.00% 0.00% 0.00% Other long-term debt repayment 0.00% 0.00% 0.00% 0.00% 0.00% Cash 1.00% 1.00% 1.00% 1.00% 1.00%
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