Delivering in fiscal 2019
Accenture reported another year of outstanding financial results in fiscal 2019. With our team of nearly 500,000 of the very best people, we delivered on our commitments to create value for our clients, our people, our shareholders and the communities in which we live and work.
We met or exceeded all the objectives in our initial business outlook for the year. Our record performance included very strong new bookings and revenue growth that significantly outpaced the market. We also delivered excellent profitability and returned record cash to shareholders, while continuing to invest substantially in our business.
Our results across industries and markets around the world speak to the durability of our business, the breadth and depth of our team, the continued strong demand for our services, and the significant growth opportunities ahead.
Among the highlights:
- We delivered record new bookings of $45.5 billion, including our highest-ever quarterly bookings of $12.9 billion in the fourth quarter.
- We grew revenues to $43.2 billion, an 8.5 percent increase in local currency and above the high end of our initial guided range.
- We delivered diluted earnings per share of $7.36, a 9 percent increase from adjusted fiscal 2018 EPS of $6.74, which exclude $0.40 in charges related to tax law changes.
- Operating margin was 14.6 percent, an expansion of 20 basis points.
- We generated excellent free cash flow of $6.0 billion and returned a record $4.6 billion in cash to shareholders through share repurchases and dividends.
- Shortly after our fiscal year-end, we announced our first quarterly cash dividend of $0.80 per share, a 10 percent increase over the equivalent quarterly rate of our previous semi-annual dividend.
We also delivered significant shareholder value once again in fiscal 2019. Accenture shares provided a 19 percent total return to shareholders for the year ended August 31, compared with 3 percent for the S&P 500 Index. Over the last five fiscal years, our compound annual total return to shareholders has been 22 percent, outperforming the S&P 500 by 12 percentage points.
Creating value for our clients
Our excellent results reflect the power of our growth strategy, which starts with our clients and their imperative to transform their businesses in today’s digital world. Accenture’s ability to create value for clients by combining unmatched technology expertise with our privileged ecosystem relationships, our innovation-led approach and deep industry knowledge continues to set us apart in the marketplace.
Our clients count on us to help them build resilience and drive growth in an increasingly complex and disruptive environment. Today, we serve more than three-quarters of the FORTUNE Global 500 and 91 of the top 100. Of our 100 largest clients, 95 have been with us for 10 years or more. And we are especially pleased that we finished fiscal 2019 with more than 200 Diamond Clients—our biggest relationships with many of the world’s most iconic companies—an increase of 60 clients from five years ago.
Most of our clients are still in the early stages of their transformations, and they recognize that technology is core to their business—and to ours. They understand that we have a unique ability to imagine, create and execute at scale and speed across markets to deliver technology solutions that are changing industries, growing businesses and improving lives. This is why our clients choose to partner with Accenture.
We believe our technology capabilities are the strongest and most innovative in the industry, with scale and leadership in all the areas that are most relevant to our clients. In particular, our Intelligent Platform Services business is a clear global leader, accounting for about 40 percent of Accenture’s total revenues, with double-digit growth in fiscal 2019. Intelligent Platform Services benefits from our strong partnerships with leading next-generation, cloud-enabled platforms—including SAP, Microsoft, Oracle, Salesforce and Workday. We are also a global leader in cloud on the major platforms including Amazon Web Services, Microsoft Azure and Google Cloud Platform. We leverage all of these relationships, together with our digital and industry expertise, to help clients transform their entire enterprises.
Our deep and broad industry expertise has always provided durability and resilience in our business. Today, it is also creating competitive advantages for us as clients increasingly seek the best solutions—not just in their own industries, but from leaders in other industries. More and more, we are adapting leading solutions from one industry to accelerate value in other industries.
For example, using artificial intelligence and our knowledge of the communications industry, we created a solution that helped Verizon use digital assistant experiences to address more than 70 percent of its customer calls. In many cases, a 20-minute conversation with a human agent has become a three- to four-minute digital interaction, improving the customer experience and allowing agents to concentrate on more complex and interesting work.
We are now applying this solution across other industries, including utilities, where Enbridge’s gas utility customers can now complete many transactions digitally, enhancing their experiences significantly. And the New Mexico Human Services Department is deploying our solution to help employees reduce the time it takes to provide Medicaid coverage to newborn babies by up to 75 percent.
As our clients navigate their futures, they rely on us for fresh ideas, cutting-edge technology solutions and strong execution.
In fiscal 2019, we continued to make substantial investments in creating innovative business and technology solutions. We invested $800 million in R&D and now have a global portfolio of more than 7,400 patents and pending patent applications.
Our investment strategy reflects our commitment to both leveraging technologies already in the market to create value, while exploring the potential and impact of emerging advancements in artificial intelligence, blockchain, extended reality, quantum computing, cybersecurity and more. For example, we collaborated with Kellogg and Qualcomm Technologies to create and pilot a virtual reality solution that embeds eye-tracking technology in a mobile headset to gather valuable insights about what grocery shoppers are looking at and why.