MCN Direct Newswire

Vol. 9 No. 2, 22 February 2010

This issue is sponsored by:

IRIS Project Solutions, Freedom Communications and 2009 UK Consulting Industry Half-Year Report

This issue's news

1. Capgemini suffers steep slide in profit
2. Fujitsu nears deal on job cuts
3. HP-led consortium secures £575m MoD deal
4. Deloitte supports Street Child World Cup
5. IBM promotes salesman to lead UK business
6. Further information - feedback/pass on to a colleague/remove from mailing list

Sponsor

IRIS Project Solutions

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1. CAPGEMINI SUFFERS STEEP SLIDE IN PROFIT

Capgemini's profits more than halved in 2009, despite a slip of only 4% in revenue. The company blames the consulting and IT services markets for the drop in revenue, which was partially offset by its stable outsourcing business.

In 2009, Capgemini's net profit was €178 million (£156 million), down from €451 million in 2008. Revenue fell to €8.4 billion. But the company did well to hold its operating margin at €595 million, representing 7.1% of 2009 revenue, down from 8.5% in the previous year.

Globally, Capgemini UK & Ireland was the only major region to report an increase in revenue, up 8% mainly on the strength of outsourcing services and its presence in the public sector. France fell 6%, North America 9% and Benelux 13%.

Revenue from consulting services fell 15%, but the company achieved an exceptional 11.4% operating margin due to tight control of operating costs. Outsourcing revenue was up a marginal 0.3%, with technology services and Sogeti showing a fall in revenue.

Capgemini's two main corporate officers, Serge Kampf and Paul Hermelin, agreed to pay cuts last year, reporting that they were "sensitive to the impact of the 2009 results on the group managers' compensation".

Looking ahead, the company expects a further fall in revenue in the first half of 2010, as comparative figures for 2009 were high, but predicts a return to growth in the second half of the year. For 2010 as a whole, Capgemini is forecasting a revenue fall of 2-4% and an operating margin of 6-6.5%.

2. FUJITSU NEARS DEAL ON JOB CUTS

Industrial action at Fujitsu has been suspended after proposals made by the company through the Advisory, Conciliation and Arbitration Service (Acas) to the Unite union were accepted. The proposals will be voted on by staff this week with a final outcome to the dispute due to be announced on Friday.

The clash began after Fujitsu announced last September that it would cut 1,200 of its 12,500 UK staff to achieve cost-cutting targets. This, along with a pay freeze and planned changes to the company's pension schemes, led to 320 of Unite's 1,620 members in Fujitsu taking strike action.

Fujitsu says that under its latest proposals, only 23 staff who would like to continue working at the company now face the risk of compulsory redundancy, and that they will leave at the end of March - the previous deadline was the end of January - unless jobs can be found for them.

Fujitsu further proposes that it will enter discussion on pay reviews in areas of the company where Unite has collective pay schemes and that it will make a defined-contributions pension scheme part of employee contracts.

With union acceptance of the proposals, it is likely that Fujitsu staff will follow suit this week and that the company will return to business as usual.

This will include fulfilling a new contract with the Department for Work and Pensions that is expected to be worth £330 million over six years and covers transformation of the department's desktop environment and outsourcing services for 140,000 desktop devices.

Sponsor

Freedom Communications

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3. HP-LED CONSORTIUM SECURES £575m MoD DEAL

The Atlas consortium, led by HP Enterprise Services (formerly EDS), has been awarded an $890 million (£575 million) extension to the Defence Information Infrastructure (DII) contract it signed with the MoD in 2005 to create a single defence information infrastructure.

The latest deal is designed to improve global collaboration and communication between the MoD and its counterparts in allied countries. It requires the Atlas consortium - led by HP and including Fujitsu, EADS Defence and Security Systems, General Dynamics and Logica - to replace legacy systems with 42,000 computer terminals that will support 60,000 personnel in restricted and secret domains.

The DII programme is already providing operational support to the UK's front-line troops and the MoD, and is expected to be used by 300,000 people in 2,000 locations when the contract ends in 2015.

Huw Owen, CEO of the Atlas consortium and UK vice president of HP Enterprise Services Defence and Security, said: "It is critical to national defence that the MoD and its allies have highly secure and real-time global access to the information they need. This latest contract enhancement sends the market a strong message about the trust that the MoD places in Atlas to deliver this critical capability."

Sponsor

2009 UK Consulting Industry Half-Year Report

The UK Consulting Industry Half-Year Report is the shorter sister publication to the UK Consulting Industry Report, produced annually by the Management Consultancies Association and published jointly with MCN Direct (owned by NCC).

The Half-Year Report January-July 2009 provides unique data and insight into the state of the UK consulting industry over the last half-year, which has been so critical for the UK and global economies. This 11-page report looks at industry performance across sectors and service lines; changing growth rates, fee rates and income; year-on-year comparisons; and the outlook and challenges for the second half of 2009 and beyond. It provides detailed statistics as well as hard-hitting analysis.

For more information and to order your copy, please click here. Alternatively contact the publishers, NCC. Tel: +44 (0)1494 732830. Fax: +44 (0)870 134 0931. Email: reports@ncc.co.uk.

4. DELOITTE SUPPORTS STREET CHILD WORLD CUP

Deloitte is the key sponsor behind the first Street Child World Cup tournament, which will be held in Durban, South Africa next month and will include disadvantaged children from the UK, Brazil, India, Nicaragua, the Philippines, South Africa, Tanzania, Ukraine and Vietnam.

The event, which has been organised by international human rights charity Amos Trust and a network of non-government and voluntary organisations, will give street children the opportunity to work with international football coaches, as well as specially trained artists who will help them to tell their stories.

Vassi Naidoo, head of the international markets group at Deloitte and chairman of the African Children's Feeding Scheme, commented: "The Deloitte Street Child World Cup will place street children centre stage, celebrating their potential and providing a platform for them to talk about the issues that matter most to them. It is a truly inspirational project that will give disadvantaged children from across the world a powerful voice on an international stage."

Chris Rose, associate director of the Amos Trust, said: "Deloitte's sponsorship of the first Street Child World Cup means the most disadvantaged of children living on the street will have a platform to demonstrate their potential and call for their rights to be recognised. No child should have to live on the streets."

The initiative kicked off earlier this month with former England goalkeeper David Seaman keeping goal in a penalty shootout with members of the UK street child team outside 11 Downing Street. Supporters of the scheme include Gordon Brown, Archbishop Desmond Tutu, David Beckham and Gary Lineker.

5. IBM PROMOTES SALESMAN TO LEAD UK BUSINESS

IBM has signalled a major sales drive with the appointment of sales veteran Stephen Leonard to the post of chief executive in the UK & Ireland.

Leonard returns to the UK after 15 months as vice president of system sales for North America. He previously held UK and EMEA roles in IBM's system and technology group. Since joining IBM in 1990, his sales management positions have included business partner sales and corporate enterprise sales.

Leonard replaces Brendon Riley, who was UK CEO for two years and has moved to become general manager of IBM's Northeast Europe region. IBM describes Leonard's responsibilities as looking after "one of the corporation's fastest growing portfolios worldwide" with a workforce of about 20,000 employees.

An early win for IBM since Leonard's tenure began on 12 January is with UK airline BMI, which is working with IBM Global Business Services' travel & transport group to transform its kiosk, web and mobile check-in systems at airports across the UK and Ireland.

6. FURTHER INFORMATION - FEEDBACK/PASS ON TO A COLLEAGUE/REMOVE

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Written by Sarah Underwood. Copyright 2010 The National Computing Centre Ltd.

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