Capgemini, the services and IT company, looks set to turn a profit on the back of public sector cuts. While cuts are not yet fully in effect, it has secured plenty of contracts including with Transport For London - as TFL plans to cut workers amidst a flurry of strikes - and saw a return to growth in the second half of 2010.
Total revenues for 2010 were $11,792 million (€8,697 million), up 3.9 percent on published revenues compared with 2009. They were down slightly, says Capgemini, on a like-for-like basis - so that's constant group structure and exchange rates. The fourth quarter was up 16.2 percent year-on-year for published figures, 10.5 up following the acquisition of Brazil's CPM Braxis, and 5.8 percent like for likes.
Booking totalled roughly $13,372 million (€9,863 million), up nine percent from 2009. Book-to-bill ratios for consulting, technology and loca professional services was 1.14 for the year and 1.21 for the fourth quarter. Outsourcing saw the highest growth of all Capgemini's businesses, up 16 percent on 2009. Five late-launch 2009 service lines, beginning operations in 2010, accounted for 37 of total bookings according to Capgemini.
Total group profit for the year was roughly $379.7 million, or €280 million. That's up an impressive 57 percent on the year before. Outlooks from Capgemini's finance team reckons that it will see growth of between nine and 10 percent in revenue. Operating margin improvements are expected to be between 0.5 points and 1 point.
Capgemini recently signed a £10.4 million IT outsourcing contract leading on until 2013 with Tube Lines, owned by Transport for London. It's a contractor under management by London Underground, which maintains trains, tracks and stations for the Jubilee, Northern and Piccadilly Lines. Capgemini has taken over all IT support and applications at Tube Lines.
Capgemini is worth keeping an eye on. It's a gigantic company that wins lucrative IT contracts in the public sector including an early signing with the Metropolitan police. It wields influence and as it returns to growth will likely continue to handle applications behind the scenes. Over in India, late last year we reported that along with rivals it has been locking in employees to stop them from jumping ship.