Capgemini raises targets after profit surge

29th July 2010, Comments 0 comments

French computer services and consulting group Capgemini reported a 29.5 percent surge in first half net earnings Thursday and raised its financial targets for the year despite a sales decline.

Net profit came to 101 million euros (132 million dollars) in the January-June period, eclipsing a forecast of 85.3 million euros from analysts polled by Dow Jones Newswires.

But sales fell 3.77 percent to 4.2 billion euros.

"The effects of the (economic) crisis continue and that's the reason for the drop in sales," said Capgemini chief executive Paul Hermelin during a telephone conference.

But he added: "We are seeing a pick-up in activity and all our projects showed clear improvement in the first half."

Orders rose 14 percent in the first half and 32 percent in the second quarter alone.

The group said it was lifting its targets, foreseeing an operating margin -- net income as a percentage of sales -- in the second half of the year of more than 6.5 percent. Previously the goal had been in the range of 6.0-6.5 percent.

Instead of a sales decline of 2.0-4.0 percent in 2010, the company now sees a contraction limited to 0.5-1.5 percent.

Capgemini employs 95,500 people, having recruited 13,000 new workers in the first half, notably in India.

© 2010 AFP

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