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June 28, 2013

Accenture Plc
(ACN-NYSE)
Stock Rating: Market Perform Industry Rating: Market Perform

IT Services
Keith Bachman, CFA
BMO Capital Markets Corp. 212-885-4010 keith.bachman@bmo.com

Jung Pak / Gaurav Gupta, CFA


310-395-0456 / 212-885-4020
jung.pak@bmo.com / gaurav.gupta@bmo.com

Securities Info

Another Weak Q
Event
Accenture reported a revenue and EPS miss in the May quarter, to follow up from a weak Feb Q. EPS would have been $1.11 without one-time gains/tax help vs. consensus and our estimates of $1.13.

Price (27-Jun) 52-Wk High/Low Mkt Cap (mm ) Shs O/S (mm , BASIC) Options O/S (mm)

$80.22 $84/$55 $52,149 650.1 na

Target Price Dividend Yield Float O/S (mm ) ADVol (30-day, 000s)

$72 $1.62 2.0% 647.6 2,526

Price Performance
Accenture plc (ACN)
Price: High,Low,Cl ose (US$) R el ati ve to S&P 500

90 80 70 60 50

170 160 150 140 130 120

Impact
Negative we think that lack of any signs of rebound in consulting will worry investors who had expected consulting to improve owing to strong signings in past few quarters. In addition, we think that slower-than-expected revenue growth in outsourcing will alter investor expectation about Accentures revenue growth potential in FY14. Net, we think that a weaker macro demand environment has finally caught up to Accenture after every major tech vendor has now reported weak results in CY13.

40 30 20 10 0 300 200 100 0 2008 2009 2010 2011 2012 2013


Vo lume (mln )

110 100 90 300 200 100 0

L ast D ata Poin t: Ju ne 2 6, 2 01 3

Valuation/Financial Data
(FY-Aug.) EPS Pro Forma P/E First Call Cons. EPS GAAP FCF P/FCF EBITDA ($mm ) EV/EBITDA Rev. ($mm) EV/Rev Quarterly EPS 2012A 2013E 2011A $3.40 2012A $3.84 2013E $4.20 19.1x $4.28 $4.91 $4.14 19.4x $4,921 9.5x $28,392 1.6x 3Q $1.03 $1.14A 2014E $4.45 18.0x $4.67 $4.45 $5.12 15.7x $4,861 9.6x $29,460 1.6x 4Q $0.88 $1.00

Forecasts
We are moving our FY13 estimates lower, net of one-time adjustments, to $4.20 from $4.34. For FY14, we are lowering our estimates to $4.45 from $4.70.

$3.39 $4.09 $3,984 $25,507 1Q $0.96 $1.06A

$3.94 $5.35 $4,465 $27,862 2Q $0.97 $1.00A

Valuation
Given our lower estimates, we are lowering our target price to $72 from $74, or approximately 16x our FY14 estimates.

Recommendation
We remain Market Perform rated on Accenture. At our target price, Accenture would trade at 2.6x PEG. While we think Accenture can take greater advantage of M&A to add software, which will help scale growth and improve margins longer term, we do not find the risk/return compelling in the absence of better consulting growth.
Changes
Annual EPS 2013E $4.34 to $4.20 2014E $4.70 to $4.45 Annual FCF 2013E $4.25 to $4.14 2014E $5.49 to $5.12

Balance Sheet Data ( 28-Feb) Net D ebt ($mm) -$5,636 TotalDebt/EBITDA 0.0x Total Debt ($mm ) $0 EBITDA/IntExp na Net D ebt/Cap. nm Price/Book 10.2x Notes: All values in US$. Source: BMO Capital Markets estimates, Bloomberg, Thomson Reuters, and IHS Global Insight.

Quarterly EPS Q4/13E $1.15 to $1.00

Target $74.00 to $72.00

Please refer to pages 8 to 10 for Important Disclosures, including the Analyst's Certification.

BMO Capital Markets

Accenture Plc

View on the Stock Two in a Row


Accenture reported another weak Q. We are moving our FY13 estimates lower, net of one-time adjustments, from $4.34 to $4.20. For FY14, we are lowering our estimates from $4.70 to $4.45. Given our lower estimates, we are lowering our target price from $74 to $72, or approximately 16x our FY14 estimates. We remain Market Perform rated on Accenture. At our target price, Accenture would trade at 2.6x PEG. While we think Accenture can take greater advantage of M&A to add software, which will help scale growth and improve margins longer-term, we do not find the risk/return compelling in the absence of better consulting growth.

Exhibit 1: Relative ValuationHigh PEG Multiple for Accenture


CY14 EPS Growth ACN 18.8x 15.0x 7% CTSH 15.9 17.1 16% EMC 12.7 7.5 10% G 19.7 21.0 16% IBM 11.7 17.8 8% INFY 13.5 13.1 4% NTAP 15.0 8.0 21% ORCL 11.0 9.5 12% SAP 16.8 19.4 13% S&P500 15.0x 8% Source: BMO Capital Markets estimates, First Call, Thomson ONE All estimates has been calendarized for comparison Street estimates are used for ORCL, SAP and G Ticker FY13 P/E EV/ FY13 FCF P/E CY14 EPS GR 2.8 1.0 1.2 1.2 1.5 3.8 0.7 0.9 1.3 1.9

For bank shots, we think that comments about strong growth in the US and financial services are positive for CTSH (Outperform) though ongoing immigration legislation will likely keep CTSH in check near-term. We think that weak consulting signings and bookings are directionally negative for IBM, as IBM (Market Perform) competes with Accenture on most of the deals. Strong BPO comments are a positive for XRX (Outperform).

What We Liked
Stable demand in financial services and healthcare verticals. Financial services and healthcare

verticals have exhibited consistent strong growth in FY13 despite the slowdown in overall revenue growth for Accenture. In the May Q, financial services revs grew by 8% y/y in CC and healthcare and public grew by 11% y/y versus total revenue growth of 3%. Within financial services insurance and capital markets grew by double digits. In addition, most of the growth in financial services was due to outsourcing as consulting revenues were probably flat. We believe that Accentures comments are generally positive for Indian IT services vendors, particularly CTSH, given their large reliance on financial services outsourcing projects. Finally, Accenture

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June 28, 2013

BMO Capital Markets

Accenture Plc

had very strong margin performance in financial services (FS) and healthcare/public verticals as op margins expanded both y/y and sequentially. For FS, op margins in the quarter improved 240 bp y/y and 380 bp q/q. FS op margins were at the highest level in the last eight quarters and we believe benefitted from strong outsourcing rev growth.
Healthy US market. Revenues in the Americas grew by 8% y/y in CC in the May Q, with strong

double digit revenue growth in the US, offset to some extent by weak performance in Brazil. We believe that revenue growth was stronger for outsourcing in the US though consulting also remains relatively stable. Accenture indicated that relatively better macroeconomic environment in the US was responsible for the strong growth as other geographic regions remains choppy. As a read through for CTSH, we think Accentures comments are positive given CTSH derives close to 80% of its revenues from the US.
Better margins help for EPS, when revs are slowing. Accenture has reported consistently higher gross margins on y/y basis in FY13 which has resulted in op margin expansion by ~40 bp in FY13 so far. Further, Accenture has stepped up its opex to offset some of the gross margin expansion. In the first three quarters of FY13, Accentures op expenses have increased by 3.8% y/y despite only 2.1% growth in revenues. Hence, we think that Accenture has some levers to drive EPS growth in FY14 despite weaker revenue growth. We believe that Accenture would balance GM expansion with opex growth to report modest margins expansion of about 20-30 bps in FY14. We forecast normalized op margins of 14.3% in FY13. For FY14, we now forecast gross margins to remain relatively flat y/y with more controlled opex resulting in op margin expansion by 20 bp to 14.5%. Better cash generation. Accenture reported operation cash flow of $1.5 billion in the quarter after reporting weak cash flow in 1HFY14. Better margins and strong working capital management continue to drive Accentures cash flow. However, Accenture lowered its operating cash flow guidance range for FY13 by $100-$200 million mainly owing to weaker revenue growth. Accentures new guidance implies operating cash flow of $1.1 billion to $1.3 billion in the August quarter, or down 30% y/y. We currently forecast operating cash flow to be $4.1 billion in FY14 or about 13.8% operating cash flow field, which we believe is reasonable.

What We Did Not Like


Rare revenue and EPS miss. Accenture joined the group of tech companies, including IBM

and ORCL, that have missed consensus estimates in FY13. That said, we believe that weakerthan-expected revenues in the outsourcing segment surprised investors. Accenture total reported revenues of $7.2 billion, which missed our/Street numbers by approximately $200 million and missed the lower end of Accentures guidance range by $50 million. Revenue growth in consulting was roughly flat in CC while outsourcing grew by 7% y/y versus our and Street expectation of solid double-digit growth. Further, reported adjusted EPS of $1.14 was higher than our/Street estimate of $1.13 but included $0.03 benefit from lower tax rate relative to our model. In addition, Accenture lowered the revenue and EPS outlook for the August Q as it expects weak rev growth to continue both in consulting and outsourcing. Hence, we have now

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June 28, 2013

BMO Capital Markets

Accenture Plc

lowered our rev growth and EPS estimate for FY14. We now forecast rev growth of ~4% y/y in CC in FY14 versus our/Street earlier forecast of approximately 7%. Our EPS estimate goes down to $4.45 versus our earlier estimate of $4.70 and Street estimate of $4.67.
Unexpected downtick in outsourcing. As mentioned above, we think that weak outsourcing rev growth was the biggest delta between our forecast and Accentures print. We were modeling outsourcing revenues to grow by 12.5% y/y in CC in May quarter while the actual growth was 7%. To make the matters worse, Accenture indicated that rev growth rate in Aug Q is likely to moderate from weak May Q level. While Accenture sounded bullish about outsourcing in general and had strong signings in the Q, we think that weak guidance will worry investors.

Our best take is that Accentures global presence across all industry verticals is affecting its growth given that the global macro environment has clearly worsened in the past few months in several specific geographies such as southern Europe, Japan, Australia and emerging markets including Brazil. We note that several other tech vendors including Oracle have recently indicated a demand slowdown in several of these geographies. Further, Accenture highlighted that client spending on shorter-term outsourcing projects has slowed and that new project ramps have been slower than expected. Specific to Accenture, FY13 outsourcing rev growth has been affected by large project ramp down in the Europe at a large CMT client. Net, we think these comments are generally negative for the industry though we still believe that outsourcing market remains healthy as weaker economic environments should drive more cost-driven projects. We now forecast 7.4% y/y rev growth for outsourcing in FY14 which is much lower than our earlier estimate of 11.5%.

Exhibit 2: Outsourcing Growth Has Hit a Soft Patch, Though Signings Remains Above Trend
Outsourcing Revs and Bookings
35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% -5.0% -10.0% -15.0% 4Q13E 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Outsourcing Revs, 4Q Rolling Avg. Source: Company Reports, BMO Capital Markets estimates

Outsourcing Bookings, 4Q Rolling Avg.

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June 28, 2013

BMO Capital Markets

Accenture Plc
No rebound in consulting. We believe that investors had hoped for a rebound in the consulting

business as Accentures P/E multiple had expanded in the FY13 despite weak results. While the May Q consulting revenues were roughly in line with our expectations, we think that weak commentary about August Q and a slowdown in systems integration and ERP related spending, weaker-than-expected ramps, fewer short-term consulting engagements will disappoint investors. We think that a weak macro environment in EMEA and unexpected weakness in certain markets such as Australia, Japan and Brazil have offset reasonable demand in the US. We now expect consulting to remain weak in FY14 and forecast approximately 1% y/y growth despite essentially flat revenues in FY13. To be fair, we think that consulting would get modest help from recent acquisitions but we dont see any signs of quick turnaround. We think that slower spending by clients on short-term projects is a negative for vendors such as IBM that have a large consulting practice. Finally, consulting bookings were lower than expected by roughly 10% in the May Q. Our comparison of bookings and revenue growth trends below indicate that this down tick does not bode well for future consulting rev growth.

Exhibit 3: Weaker Consulting Bookings Will Weigh on Revenue Growth


Consulting Revs and Bookings
30.0% 20.0% 10.0% 0.0% -10.0% -20.0% -30.0% 4Q13E 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Consulting Revs, 2Q Rolling Avg. Source: Company Reports, BMO Capital Markets estimates

Consulting Bookings, 2Q Rolling Avg.

Risks. Risks to our target price include macro demand slowdown, slower revenue and earnings

growth, visa-related issues, and forex fluctuations.

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June 28, 2013

BMO Capital Markets

Page 6
AugA NovA $3,881 $4,083 2,807 2,991 6,688 7,074 4,472 4,823 2,215 2,252 821 837 472 433 0 0 1,293 1,270 923 981 13 12 935 993 253 281 683 712 (11) (8) 672 704 $0.91 $0.96 $0.91 $0.96 738 730 33.1% -91 bp 19.3% -154 bp 13.8% 63 bp 14.0% 77 bp 27.0% -180 bp 10.1% 76 bp 31.8% -34 bp 18.0% -53 bp 13.9% 19 bp 14.0% 7 bp 28.3% 2 bp 10.0% 4 bp 31.1% -54 bp 18.1% -87 bp 13.1% 34 bp 13.2% 43 bp 20.5% -640 bp 10.4% 115 bp 33.1% -123 bp 18.3% -193 bp 14.8% 70 bp 14.9% 65 bp 28.5% 146 bp 10.5% 22 bp 32.9% -23 bp 19.1% -19 bp 13.8% -4 bp 13.8% -15 bp 32.8% 577 bp 9.2% -83 bp 32.8% 31.6% 95 bp 46 bp 18.2% 15.1% 29 bp -295 bp 14.5% 16.5% 66 bp 342 bp 14.5% 16.7% 46 bp 352 bp 26.8% -0.5% -153 bp nm 10.5% 16.7% 54 bp 636 bp 33.9% 73 bp 18.0% -31 bp 15.9% 104 bp 15.9% 102 bp 23.8% -470 bp 12.0% 148 bp 33.5% 60 bp 19.4% 23 bp 14.1% 37 bp 14.2% 40 bp 27.0% -576 bp 10.2% 102 bp 33.0% 23 bp 18.2% -1 bp 14.8% 23 bp 14.9% 39 bp 26.5% -30 bp 10.8% 32 bp 32.0% 40 bp 18.3% 316 bp 13.7% -276 bp 13.9% -287 bp 26.5% nm 10.1% -667 bp 33.5% -37 bp 18.3% 34 bp 15.2% -71 bp 15.3% -66 bp 26.5% 273 bp 11.1% -90 bp 33.4% -10 bp 19.2% -22 bp 14.2% 12 bp 14.4% 13 bp 26.5% -50 bp 10.4% 18 bp 33.6% 194 bp 20.1% 67 bp 13.53% 127 bp 13.5% 111 bp 29.3% 168 bp 9.5% 56 bp 12,371 -1% 9,179 2% 21,551 0% 7,251 6% 2,915 10% $2.68 0% 32.9% -77 bp 19.3% -85 bp 13.61% 8 bp 13.8% 25 bp 27.3% -200 bp 9.9% 43 bp 14,924 21% 10,583 15% 25,507 18% 8,387 16% 3,470 19% $3.40 27% 32.3% -62 bp 18.4% -91 bp 13.90% 29 bp 14.0% 24 bp 27.6% 34 bp 10.0% 13 bp 15,562 4.3% 12,300 16.2% 27,862 9.2% 8,988 7% 3,872 12% $3.84 13% 2012 FebA MayA $3,775 $3,965 3,022 3,189 6,797 7,155 4,681 4,784 2,116 2,371 772 854 454 455 0 0 1,227 1,310 889 1,061 9 6 899 1,066 184 304 714 763 (10) (10) 705 752 $0.97 $1.03 $0.97 $1.03 729 729 AugA $3,738 3,098 6,836 4,587 2,249 839 469 0 1,309 940 6 946 310 636 (6) 630 $0.88 $0.88 718 NovA $3,961 3,259 7,220 4,854 2,366 868 449 0 1,318 1,049 (2) 1,047 280 766 (8) 758 $1.06 $1.06 717 2010A 2011A $12,371 $14,924 9,179 $10,583 21,551 25,507 14,300 17,120 7,251 8,387 2,658 3,094 1,668 1,820 10 2 4,336 4,916 2,915 3,470 (0) 42 2,914 3,512 854 959 2,060 2,553 (22) (32) 2,038 2,521 $2.66 $3.40 $2.68 $3.40 767 742 2013 FebA MayA $3,753 $3,867 3,305 3,331 7,058 7,198 4,828 4,760 2,230 2,438 834 887 456 459 (224) (49) 1,066 1,296 1,165 1,142 17 5 1,181 1,147 (6) 273 1,187 874 (7) (11) 1,180 863 $1.65 $1.21 $1.00 $1.14 715 715 2014 AugE NovE FebE MayE AugE $3,663 $3,901 $3,753 $3,944 $3,737 3,253 3,445 3,503 3,631 3,545 6,916 7,346 7,256 7,575 7,282 4,599 4,922 4,934 5,038 4,850 2,317 2,424 2,322 2,538 2,432 865 880 855 910 905 475 460 470 480 490 0 0 0 0 0 1,340 1,340 1,325 1,390 1,395 977 1,084 997 1,148 1,037 8 9 9 9 9 985 1,093 1,006 1,157 1,046 266 290 267 307 277 719 804 739 850 769 (11) (9) (10) (10) (10) 708 795 729 840 759 $1.00 $1.13 $1.04 $1.20 $1.09 $1.00 $1.13 $1.04 $1.20 $1.09 710 705 702 702 698 Fiscal Year 2012A 2013E $15,562 $15,244 $12,300 $13,148 27,862 28,392 18,875 19,041 8,988 9,352 3,303 3,454 1,811 1,838 2 (273) 5,116 5,019 3,872 4,332 33 27 3,904 4,359 1,079 813 2,825 3,546 (34) (36) 2,791 3,510 $3.84 $4.91 $3.84 $4.20 726 714 32.9% 68 bp 17.7% -68 bp 15.26% 136 bp 15.35% 134 bp 18.7% -899 bp 12.4% 234 bp 15,244 -2.0% 13,148 7% 28,392 1.9% 9,352 4% 4,332 12% $4.20 9% 2014E $15,335 $14,125 29,460 19,744 9,716 3,550 1,900 0 5,450 4,266 36 4,302 1,140 3,162 (39) 3,123 $4.45 $4.45 702 33.0% 4 bp 18.5% 82 bp 14.48% -78 bp 14.6% -75 bp 26.5% 785 bp 10.6% -176 bp 15,335 0.6% 14,125 7% 29,460 3.8% 9,716 4% 4,266 -2% $4.45 6% 3,663 -2% -5% 3,253 5% -2% 6,916 0% -4% 2,317 3% -5% 977 4% -14% $1.00 14% -12% 3,901 -2% 6% 3,445 6% 6% 7,346 2% 6% 2,424 2% 5% 1,084 3% 11% $1.13 7% 13% 3,753 0% -4% 3,503 6% 2% 7,256 3% -1% 2,322 4% -4% 997 -14% -8% $1.04 4% -8% 3,944 2% 5% 3,631 9% 4% 7,575 5% 4% 2,538 4% 9% 1,148 1% 15% $1.20 5% 15% 3,737 2% -5% 3,545 9% -2% 7,282 0% -4% 2,432 5% -4% 1,037 6% -10% $1.09 9% -9% 3,881 25% -2% 2,807 21% 2% 6,688 23% 0% 2,215 20% -4% 923 29% -3% $0.91 37% -2% 4,083 14% 5% 2,991 21% 7% 7,074 17% 6% 2,252 16% 2% 981 19% 6% $0.96 19% 6% 3,775 8% -8% 3,022 19% 1% 6,797 12% -4% 2,116 10% -6% 889 15% -9% $0.97 29% 0% 3,965 0% 5% 3,189 16% 6% 7,155 6% 5% 2,371 3% 12% 1,061 12% 19% $1.03 11% 7% 3,738 -4% -6% 3,098 10% -3% 6,836 2% -4% 2,249 2% -5% 940 2% -11% $0.88 -4% -15% 3,961 -3% 6% 3,259 9% 5% 7,220 2% 6% 2,366 5% 5% 1,049 7% 12% $1.06 10% 20% 3,753 -1% -5% 3,305 9% 1% 7,058 4% -2% 2,230 5% -6% 1,165 31% 11% $1.00 3% -6% 3,867 -2% 3% 3,331 4% 1% 7,198 1% 2% 2,438 3% 9% 1,142 8% -2% $1.14 10% 14%

ACN Income Statement 2011 FebA MayA ($ millions, except per share) NovA Consulting $3,568 $3,509 $3,966 Outsourcing 2,478 2,544 2,754 Net revenue 6,046 6,054 6,720 Cost of revenue 4,101 4,136 4,410 Gross profit 1,944 1,917 2,310 S&M 731 710 832 G&A 386 435 527 Reorganization 0 0 0 Operating expenses 1,118 1,146 1,360 Operating income 827 772 949 Interest and other income 18 3 8 Pretax income 845 774 958 Taxes 239 208 259 Net income attributable to ACN 606 566 699 Minority interest (6) (8) (7) Net income 599 558 692 GAAP EPS $0.81 $0.75 $0.93 Non-GAAP EPS $0.81 $0.75 $0.93 Diluted shares outstanding 743 743 746 Margin Analysis (As % of Sales) Gross margin 32.2% 31.7% 34.4% Y/Y Change -98 bp -98 bp -30 bp Total Operating expenses 18.5% 18.9% 20.2% Y/Y Change -79 bp -115 bp 0 bp Operating margin 13.7% 12.7% 14.1% Y/Y Change -19 bp 17 bp -30 bp Pretax margin 14.0% 12.8% 14.3% Y/Y Change -6 bp 44 bp -16 bp Tax rate 28.3% 26.9% 27.0% Y/Y Change -219 bp -84 bp -283 bp Net margin 9.9% 9.2% 10.3% Y/Y Change 28 bp 36 bp 29 bp Growth Analysis Consulting 3,568 3,509 3,966 Y/Y Change 14% 20% 23% Q/Q Change 15% -2% 13% Outsourcing 2,478 2,544 2,754 Y/Y Change 10% 13% 17% Q/Q Change 7% 3% 8% Net revenue 6,046 6,054 6,720 Y/Y Change 12% 17% 21% Q/Q Change 12% 0% 11% Gross profit 1,944 1,917 2,310 Y/Y Change 9% 13% 20% Q/Q Change 5% -1% 20% Operating income 827 772 949 Y/Y Change 11% 19% 18% Q/Q Change 16% -7% 23% EPS $0.81 $0.75 $0.93 Y/Y Change 19% 25% 27% Q/Q Change 21% -7% 24% Source: Company Reports and BMO Capital Markets estimates

Accenture Plc

June 28, 2013

BMO Capital Markets

Page 7
2012 2013 2014

ACN Cash Flow

MayA $763 135 0 151 (71) (172) 411 1,216 (90) 6 (1) 1 (11) 0 (96) 1 (210) 0 (296) (71) 11 (151) (110) 55 (700) 0 0 0 (645) 554 5,938 $6,493 $1,199 $1.75 0 (618) 0 (743) (451) 6,493 $6,042 $292 $0.41 175 (300) 110 (700) 0 0 0 (590) 221 6,042 $6,263 $811 $1.16 (110) (110) 181 (618) 0 (562) (1) (999) (50) 302 5,636 $5,938 $1,412 $2.04 (140) 175 (750) 0 (618) 0 (1,193) (220) 6,263 $6,043 $972 $1.40 165 (221) (115) 0 0 3 (1) 0 (113) (87) (90) 0 0 2 (88) 0 (177) (91) (110) (110) (110) (140) (120) $636 179 0 126 (43) 66 744 1,708 $766 140 0 114 (68) 27 (1,087) (109) $1,187 157 (224) 184 16 (25) (661) 634 $874 142 0 175 0 (49) 361 1,502 $719 150 0 130 0 0 310 1,309 $804 145 0 120 0 0 (666) 402 $739 150 0 130 0 0 (99) 921 $850 150 0 130 0 0 (18) 1,112 $769 150 0 130 0 0 587 1,636 $2,553 513 2 450 (196) 81 39 3,442 $2,825 594 2 538 (176) (94) 569 4,257

AugA

NovA

FebA

MayA

AugE

NovE

FebE

MayE

AugE

2011A

Fiscal Year 2012A 2013E $3,546 589 (223) 603 (53) (48) (1,078) 3,337

2014E $3,162 595 0 510 0 0 (196) 4,071

(120) 60 (750) 0 0 0 (690) 826 6,043 $6,868 $1,516 $2.21

(404) 11 (11) 7 (306) 0 (703)

(372) 13 (8) 6 (174) 0 (535)

(377) 0 0 2 (369) 11 (734)

(480) 0 0 0 0 0 (480)

($ millions, except per share) NovA FebA Operating Net income $712 $714 Depreciation and amortization 133 147 Restructuring and reorganization costs 0 0 Stock-based compensation expense 101 161 Deferred income taxes (29) (33) Other non-cash adjustments (17) 30 Working capital changes (424) (162) Cash from Operations 475 857 Investing Capital expenditures (81) (85) Proceeds from maturities/sales of investments 4 3 Purchase of investments (4) (3) Proceeds from sales of property and equipment 1 1 Purchases of businesses, net of cash acquired (160) (3) Proceeds from sale of businesses 0 0 Cash from Investing (240) (87) Financing Proceeds from issuance of common stock 140 89 Common stock repurchase (285) (465) Proceeds from (repayment of) long-term debt (0) (1) Proceeds from (repayment of) short-term borrowings 0 0 Cash dividends paid (475) 0 Excess tax benefit from employees stock plans 32 26 Other financing 0 (27) Cash from Financing (588) (378) Effect of exchange rate (257) 85 Net increase (decrease) in cash (609) 476 Cash and cash equivalents, beginning of period 5,701 5,092 Cash and cash equivalents, end of period $5,092 $5,568 Free cash flow $394 $772 Free cash flow per share $0.54 $1.07 Source: Company reports and BMO Capital Markets estimates 169 (653) (5) 5 (476) 12 (2) (950) (110) 60 5,568 $5,629 $1,126 $1.57 0 (560) 39 (1) (578) 21 (962) 6,641 $5,679 ($195) ($0.28) 57 (696) (0) (5) 0 8 (7) (643) 59 1,012 5,629 $6,641 $1,593 $2.23 112 (609) (0) 0 0 47 (15) (465) (35) (43) 5,679 $5,636 $544 $0.78 557 (2,172) (2) (0) (644) 171 (33) (2,122) 246 863 4,838 $5,701 $3,038 $4.09 454 (2,099) (6) 0 (951) 78 (36) (2,559) (223) 939 5,701 $6,641 $3,885 $5.35

513 (2,148) (0) 0 (1,122) 86 (17) (2,687) (64) (148) 6,641 $6,493 $2,960 $4.14

520 (2,500) 0 0 (1,236) 0 0 (3,216) 0 376 6,493 $6,868 $3,591 $5.12

Accenture Plc

June 28, 2013

BMO Capital Markets

Accenture Plc

Accenture plc (ACN)


Quarterly Price (US$) 90 80 70 60 50 40 30 20 10 80 70 60 50 40 30 20 10 40 30 20 ACN Relative to S&P 500 ACN Relative to IT Consulting & Services 250 200 150 100 250 200 150 100 ACN Relative to S&P 500 ACN Relative to IT Consulting & Services 80 70 60 50 1) Mkt 40 30 20 80 70 60 50 Target Price(US$) Share Price(US$) 90

160 140 120 100 80

160 140 120 100 80 2013

1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 Revenue / Share - (US$) Price / Revenue

2011

2012

50 40 30

2 1 0

BMO 2013FY EPS ( May 13 = 4.34 US$) First Call 2013FY Cons.EPS ( May 13 = 4.28 US$) 4.4 4.2 4.0 BMO 2014FY EPS ( May 13 = 4.70 US$) First Call 2014FY Cons.EPS ( May 13 = 4.67 US$) 4.5 4.0 2011 2012 4.5 4.0 2013 4.4 4.2 4.0

EPS (4 Qtr Trailing) - (US$) Price / Earnings

40 20

1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

FYE (Aug.) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Range*: Current*

EPS US$ 0.82 0.91 1.05 1.23 1.47 1.61 1.97 2.65 2.66 2.66 3.40 3.84

P/E Hi - Lo 19.1 33.5 21.0 22.8 18.8 20.5 22.4 16.2 16.2 16.8 18.7 17.2 33.5 17.0 12.8 10.8 15.2 14.3 15.0 13.9 12.0 9.3 0.1 10.7 12.3 0.1

DPS US$ 0.00 0.00 0.00 0.00 0.00 0.30 0.35 0.42 0.50 0.75 0.90 1.35

Yield% Hi - Lo 0.0 0.0 0.0 0.0 0.0 1.2 1.3 1.3 2.0 535.7 2.5 2.8 >100 0.0 0.0 0.0 0.0 0.0 0.9 0.8 1.0 1.2 1.7 1.4 2.0 0.0

Payout % 0 0 0 0 0 19 18 16 19 28 26 35

BV US$ 0.3 0.5 0.8 1.6 1.8 2.3 2.6 2.9 3.8 4.2 5.4 6.6

P/B Hi - Lo >15 >15 >15 >15 >15 14.4 >15 14.9 11.4 10.5 11.7 10.0 >15 >15 >15 13.6 12.1 11.4 10.5 10.6 11.1 6.6 0.0 6.7 7.2 0.0

ROE % >50 >50 >50 >50 >50 >50 >50 >50 >50 >50 >50

ACN - Rating as of 15-Jul-10 = NR Date 2-Aug-11 Rating Change NR to Mkt Share Price $58.01

3.97

20.7

1.62

2.0

41

6.6

12.4

>50

Growth(%): 5 Year: 9.9 10 Year: 15.2

31.0 nm

20.6 30.3

* Current EPS is the 4 Quarter Trailing to Q2/2013. * Valuation metrics are based on high and low for the fiscal year. * Range indicates the valuation range for the period presented above.

Last Price ( June 26, 2013): $79.56 Sources: IHS Global Insight, Thomson Reuters, BMO Capital Markets.

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June 28, 2013

BMO Capital Markets Important Disclosures

Accenture Plc

Analyst's Certification I, Keith Bachman, CFA, hereby certify that the views expressed in this report accurately reflect my personal views about the subject securities or issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Analysts who prepared this report are compensated based upon (among other factors) the overall profitability of BMO Capital Markets and their affiliates, which includes the overall profitability of investment banking services. Compensation for research is based on effectiveness in generating new ideas and in communication of ideas to clients, performance of recommendations, accuracy of earnings estimates, and service to clients. Analysts employed by BMO Nesbitt Burns Inc. and/or BMO Capital Markets Ltd. are not registered as research analysts with FINRA. These analysts may not be associated persons of BMO Capital Markets Corp. and therefore may not be subject to the NASD Rule 2711 and NYSE Rule 472 restrictions on communications with a subject company, public appearances, and trading securities held by a research analyst account. Company Specific Disclosure Disclosure 9: BMO Capital Markets makes a market in this security. Methodology and Risks to Our Price Target/Valuation Methodology: Our target price is based on average of P/E of our FY2014 EPS estimate and our DCF valuation. Risks: Risks to our target price include macro demand slowdown, slower revenue and earnings growth, visa related issues and increased competition. Distribution of Ratings (March 31, 2013) Rating BMOCM US BMOCM US BMOCM US BMOCM BMOCM Starmine Category BMO Rating Universe* IB Clients** IB Clients*** Universe**** IB Clients***** Universe Buy Outperform 37.3% 16.5% 53.8% 38.2% 51.3% 53.2% Hold Market Perform 58.0% 8.8% 44.6% 56.8% 47.7% 41.1% Sell Underperform 4.7% 3.7% 1.5% 4.9% 1.0% 5.7% * Reflects rating distribution of all companies covered by BMO Capital Markets Corp. equity research analysts. ** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking services as percentage within ratings category. *** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking services as percentage of Investment Banking clients. **** Reflects rating distribution of all companies covered by BMO Capital Markets equity research analysts. ***** Reflects rating distribution of all companies from which BMO Capital Markets has received compensation for Investment Banking services as percentage of Investment Banking clients. Rating and Sector Key (as of April 5, 2013) We use the following ratings system definitions: OP = Outperform - Forecast to outperform the analysts coverage universe on a total return basis; Mkt = Market Perform - Forecast to perform roughly in line with the analysts coverage universe on a total return basis; Und = Underperform - Forecast to underperform the analysts coverage universe on a total return basis; (S) = Speculative investment; NR = No rating at this time; and R = Restricted Dissemination of research is currently restricted. BMO Capital Markets' seven Top 15 lists guide investors to our best ideas according to different objectives (CDN Large Cap, CDN Small Cap, US Large Cap, US Small Cap, Income, CDN Quant, and US Quant have replaced the Top Pick rating). Prior BMO Capital Markets Rating System (January 4, 2010 April 4, 2013): http://researchglobal.bmocapitalmarkets.com/documents/2013/prior_rating_system.pdf Other Important Disclosures For Other Important Disclosures on the stocks discussed in this report, please go to http://researchglobal.bmocapitalmarkets.com/Public/Company_Disclosure_Public.aspx or write to Editorial Department, BMO Capital Markets, 3 Times Square, New York, NY 10036 or Editorial Department, BMO Capital Markets, 1 First Canadian Place, Toronto, Ontario, M5X 1H3. Dissemination of Research Our research publications are available via our web site http://www.bmocm.com/research/. Institutional clients may also receive our research via FIRST CALL, Thomson Reuters, Bloomberg, FactSet, Capital IQ, and TheMarkets.com. All of our research is made widely available at the same time to all BMO Capital Markets client groups entitled to our research. Additional dissemination may occur via email or regular mail. Please contact your investment advisor or institutional salesperson for more information.

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June 28, 2013

BMO Capital Markets

Accenture Plc

Conflict Statement A general description of how BMO Financial Group identifies and manages conflicts of interest is contained in our public facing policy for managing conflicts of interest in connection with investment research, which is available at http://researchglobal.bmocapitalmarkets.com/Public/Conflict_Statement_Public.aspx. General Disclaimer BMO Capital Markets is a trade name used by the BMO Investment Banking Group, which includes the wholesale arm of Bank of Montreal and its subsidiaries BMO Nesbitt Burns Inc., BMO Capital Markets Ltd. in the U.K. and BMO Capital Markets Corp. in the U.S. BMO Nesbitt Burns Inc., BMO Capital Markets Ltd. and BMO Capital Markets Corp are affiliates. Bank of Montreal or its subsidiaries (BMO Financial Group) has lending arrangements with, or provide other remunerated services to, many issuers covered by BMO Capital Markets. The opinions, estimates and projections contained in this report are those of BMO Capital Markets as of the date of this report and are subject to change without notice. BMO Capital Markets endeavours to ensure that the contents have been compiled or derived from sources that we believe are reliable and contain information and opinions that are accurate and complete. However, BMO Capital Markets makes no representation or warranty, express or implied, in respect thereof, takes no responsibility for any errors and omissions contained herein and accepts no liability whatsoever for any loss arising from any use of, or reliance on, this report or its contents. Information may be available to BMO Capital Markets or its affiliates that is not reflected in this report. The information in this report is not intended to be used as the primary basis of investment decisions, and because of individual client objectives, should not be construed as advice designed to meet the particular investment needs of any investor. This material is for information purposes only and is not an offer to sell or the solicitation of an offer to buy any security. BMO Capital Markets or its affiliates will buy from or sell to customers the securities of issuers mentioned in this report on a principal basis. BMO Capital Markets or its affiliates, officers, directors or employees have a long or short position in many of the securities discussed herein, related securities or in options, futures or other derivative instruments based thereon. The reader should assume that BMO Capital Markets or its affiliates may have a conflict of interest and should not rely solely on this report in evaluating whether or not to buy or sell securities of issuers discussed herein. Additional Matters To Canadian Residents: BMO Nesbitt Burns Inc., affiliate of BMO Capital Markets Corp., furnishes this report to Canadian residents and accepts responsibility for the contents herein subject to the terms set out above. Any Canadian person wishing to effect transactions in any of the securities included in this report should do so through BMO Nesbitt Burns Inc. The following applies if this research was prepared in whole or in part by Andrew Breichmanas, Tony Robson, or Edward Sterck: This research is not prepared subject to Canadian disclosure requirements. This research is prepared by BMO Capital Markets Limited and subject to the regulations of the Financial Conduct Authority (FCA) in the United Kingdom. FCA regulations require that a firm providing research disclose its ownership interest in the issuer that is the subject of the research if it and its affiliates own 5% or more of the equity of the issuer. Canadian regulations require that a firm providing research disclose its ownership interest in the issuer that is the subject of the research if it and its affiliates own 1% or more of the equity of the issuer that is the subject of the research. Therefore BMO Capital Markets Limited will only disclose its and its affiliates ownership interest in the subject issuer if such ownership exceeds 5% of the equity of the issuer. To U.S. Residents: BMO Capital Markets Corp. and/or BMO Nesbitt Burns Securities Ltd., affiliates of BMO NB, furnish this report to U.S. residents and accept responsibility for the contents herein, except to the extent that it refers to securities of Bank of Montreal. Any U.S. person wishing to effect transactions in any security discussed herein should do so through BMO Capital Markets Corp. and/or BMO Nesbitt Burns Securities Ltd. To U.K. Residents: In the UK this document is published by BMO Capital Markets Limited which is authorised and regulated by the Financial Conduct Authority. The contents hereof are intended solely for the use of, and may only be issued or passed on to, (I) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the Order) or (II) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together referred to as relevant persons). The contents hereof are not intended for the use of and may not be issued or passed on to, retail clients.

ADDITIONAL INFORMATION IS AVAILABLE UPON REQUEST BMO Financial Group (NYSE, TSX: BMO) is an integrated financial services provider offering a range of retail banking, wealth management, and investment and corporate banking products. BMO serves Canadian retail clients through BMO Bank of Montreal and BMO Nesbitt Burns. In the United States, personal and commercial banking clients are served by BMO Harris Bank N.A., Member FDIC. Investment and corporate banking services are provided in Canada and the US through BMO Capital Markets. BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, BMO Harris Bank N.A, BMO Ireland Plc, and Bank of Montreal (China) Co. Ltd. and the institutional broker dealer businesses of BMO Capital Markets Corp. (Member SIPC), BMO Nesbitt Burns Securities Limited (Member SIPC) and BMO Capital Markets GKST Inc. (Member SIPC) in the U.S., BMO Nesbitt Burns Inc. (Member Canadian Investor Protection Fund) in Canada, Europe and Asia, BMO Capital Markets Limited in Europe, Asia and Australia and BMO Advisors Private Limited in India. Nesbitt Burns is a registered trademark of BMO Nesbitt Burns Corporation Limited, used under license. BMO Capital Markets is a trademark of Bank of Montreal, used under license. "BMO (M-Bar roundel symbol)" is a registered trademark of Bank of Montreal, used under license. Registered trademark of Bank of Montreal in the United States, Canada and elsewhere. TM Trademark Bank of Montreal COPYRIGHT 2013 BMO CAPITAL MARKETS CORP.

A member of BMO

Financial Group

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June 28, 2013