May 19, 2020

Capgemini reports strong H1 performance, profit up 14%

capgemini
European outsourcing industry
European tech consulting industry
Paul Hermelin
Real GDPR
2 min
Capgemini reports strong H1 performance, profit up 14%

Consulting, technology and outsourcing services provider Capgemini recorded strong financials for the first half of this year, reporting revenues of €6.26 billion.

This figure is up 11.6 percent on H1 2015 reported revenues and 14.4 percent at constant exchange rates. Organic growth (i.e. excluding the impact of Group currencies against the euro and changes in Group scope) was 3.3 percent for H1 and 3.8 percent for Q2. Digital and cloud revenues grew 32 percent at constant exchange rates and account for 28 percent of H1 revenues.

New orders recorded during the first six months of 2016 totalled €6,341 million, compared to €5,309 million reported for H1 2015.

Operating margin grew by 31 percent year-on-year to €638 million, and represents 10.2 percent of revenues, up 150 basis points year-on-year, with an increase in all Group’s regions and businesses. H1 2016 operating profit increased to 8.1 percent of revenues or €510 million, up 14 percent year-on-year.

Paul Hermelin, Chairman and Chief Executive Officer of Capgemini Group, said: "Having started the year with a good momentum, the Group has delivered an excellent first-half. Our revenue is up 14.4 percent at constant exchange rates and our operating margin increased sharply ( 1.5 points) to 10.2 percent of revenues with margin improvement in each of the Group's regions.

“We continue to expand in market segments driven by innovation. Demand for Digital & Cloud remains solid with a 32 percent revenue progression. Our Consulting business also benefits from its position on Digital Transformation with growth of 8.1 percent.

“We expanded our portfolio of innovative services with a Digital Manufacturing offering targeting industrial companies and launched the new Automation Drive service line, bringing together all the Group’s automation technology and expertise.

“This first-half has also seen confirmation of the successful integration of IGATE which has been operating under the Capgemini brand since January: synergies are delivered ahead of plan and sales momentum is excellent, as evidenced by sustained growth in key accounts.

“Finally, our global network of delivery centres now counts over 100,000 employees and represents 55 percent of the total Group headcount. This is key to our competitiveness, notably with a growing demand in Europe.

“Based on the first half results, we are raising our operating margin guidance for full year 2016 to between 11.3 percent and 11.5 percent."

Read the July EURO 2016 issue of Business Review Europe magazine. 

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Jun 8, 2021

UK office space slashed as hybrid working looks set to stay

offices
hybridworking
realestate
PwC
Kate Birch
3 min
As more UK firms announce a hybrid way of working, new research suggests a third of businesses will reduce their office footprint by more than 30%

With hybrid predicted to be the working model of the future, and businesses both large and small announcing that WFH will continue for employees into the future, the traditional office space is being re-thought.

Businesses are both questioning how much space they need for a hybrid working future, especially if it means they can potentially save money, and what form that space should take.

UK firms slashing office space

Back as early as February, HSBC – whose real estate footprint currently stretches to around 112 football pitches worldwide – said it would be cutting its post-COVID office space by half globally and by 40% in London over the next few years, as it looks to implementation of a hybrid working model in light of the pandemic.

Lloyds Bank followed suit. Following an internal survey where 77% of employees said they wanted to continue to work for 3+ days a week post-pandemic, the bank announced it was also moving to a hybrid model, and so looking to cut its office space by 20% over the next two years.

In fact, the latest research from consulting firm PwC reveals that a third of organisations surveyed (258 of the UK’s largest companies) believe they will reduce their office footprint by more than 30%.

The findings of PwC’s Occupier Survey indicate there is likely to be a sizeable fall in occupied office space with half of executives surveyed saying that despite taking into account mass vaccinations, employees will continue to work virtually 2-3 days a week.

And companies continue to announce the hybrid working model for their employees. Accountancy firm EY has just announced that its 17,000 employees are moving to a hybrid way of working, WFH for at least two days a week. This follows PwC which in March said workers could stay at home for half the time and KPMG which this month said it would expect employees to only work two days in the office every week.

More collaborative work spaces

However, what’s also clear from PwC’s research is that the role of the office is not going to disappear completely, but instead adapt to a new way of working, with half of all organisations with more than 100 employees saying they have a real estate and workplace strategy that considers the long-term impact of COVID-19.

“We may see an increased demand for flexible space as many businesses operating models may well need that option if holding dead space is to be avoided,” says Angus Johnson, UK Real Estate Leader at PwC UK.

According to the survey, more than three quarters of respondents said they are likely to reconfigure existing office with 43% of financial services firms stating that they are extremely likely to do so as a result of the pandemic.

“It’s also clear that the nature and purpose of office space is going to change. As occupiers seek new, different space to meet their accommodation needs, environmental aspects will be increasingly important. If the real estate sector is to truly succeed as a more dynamic, greener industry it’s imperative that creative thinking comes to the fore.”

And companies are already thinking creatively how they can utilise office space in a hybrid future. So while HSBC is cutting a significant amount of office space, it is not downsizing its prestigious Canary Wharf headquarters, and instead reimagining the space. In April, CEO Noel Quinn announced the firm was embracing an open plan floor, with no designated desks or private offices, and instead using hot-desks in line with the future hybrid working style. “My leadership team and I have moved to a fully open-plan floor of the building in east London with no designated desks,” he said on LinkedIn.

Lloyds also reported it was adapting its office space, so that rather than individual offices, it will have a more collaborative workspace. And just last month, KPMG announced it too was ditching desks and individual offices, and replacing them with meeting rooms and conference halls for a more collaborative workspace.

 

 

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