Since 2003, Accenture (NYSE:ACN) set out on an extensive study of more than 6,000 companies to understand "high performance." The conclusion? It's definable, quantifiable, and achievable. It's also something that Accenture has been practicing lately.
Late last week, the company posted its fiscal Q3 results. Revenues increased 15.3% to $5.08 billion as demand for Accenture's consulting and outsourcing services continued their momentum. The growth comes despite the intense competition from players like Wipro (NYSE:WIT), Infosys (NASDAQ:INFY), and EDS (NYSE:EDS).
Net income was $345.4 million, which was up about 1% over the past year, as the company took a $58 million charge for an assortment of reorganization expenses. Accenture continues to rack up lots of contract business. In Q3, the company added $6.2 billion in bookings, and the consulting segment hit a record with $3.5 billion in new business.
With all this growth, it's no surprise that Accenture has boosted guidance. The company increased 2007 earnings-per-share estimates from $1.88-$1.93 to $1.94-$1.96. Operating cash flow should be about $2.2 billion to $2.4 billion.
A couple weeks ago, Accenture announced that it will invest $250 million over the next three years to build a more sophisticated consulting platform. The goal is to manage the complex information technology (IT) assets of customers such as software renewals, data center consolidation, application testing, and security. It's a smart move, and the strategy has been a success for companies like IBM (NYSE:IBM).
With a strong customer pipeline and solid execution, Accenture should sustain its growth into next year. There should also be continued improvement in cost-cutting, which should help margins. This consistency is a hallmark of high performance companies and should help provide even more upside for shareholders.
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Fool contributor Tom Taulli, author of The Complete M&A Handbook, does not own shares mentioned in this article. He is currently ranked 1,656 out of 31,342 rated investors in CAPS.
