Capgemini is a multinational company founded in the France . The company main activities are consulting, technology and outsourcing services. This paper aims to analyze the financial performance for the financial year starting from 2013 to 2016 by looking at its financial ratios and conducting a comparison of three other companies within the same industry namely ALTEN, ATOS and Sopra Steria Group. With the completion of the analysis, it can be concluded that Capgemini has a strong financial performance with steady growth rate in terms of its Revenue and PBIT Margin. A slight decrease in Net Profit lately margin is not a huge concern as it is the highest compared to its counterparts. On top of that, the company accomplished that without the
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Its key revenue driver is Application Services which falls under the Technology Solutions which accounts for 60% of its entire revenue. Application Services refers to the development implementation and maintenance of IT applications. Meanwhile as with most service providing companies, personnel cost is the major contribution for its expense accounting for over 70% of its total operating expense. The other three selected companies within the same industries which is used to compared the financial ratios and analysis of Capgemini are:
1. ALTEN: Founded in 1988, it is also a technology consulting firm headquartered in France. The company provides services to its clients in the fields of Innovation, Research and Development and IT systems. The services range from consulting to full project outsourcing. ATEN is currently present in 20 countries across the globe.
2. ATOS: Also based in France, ATOS is an IT services corporation specialized in Transactional & Payment services, Business and Platform Solutions, Cloud and Enterprise Software and Infrastructure and Data Management. Currently it has over 100,000 employees and spread across 72 countries. Besides that, it also involves in delivery and catering services as well as franchises its brand …show more content…
This indicates that the company is unlikely to be exposed to financial risk. All of the other companies within the same sector are also lowly geared with ALTEN, ATOS and Sopra Steria Group having 0.09, 0.25 and 0.66 gearing ratio respectively. It is expected that these type of companies are lowly geared and normally do not leverage unlike company in the financial service industry. The average current ratio of the company meanwhile is 1.43 and the ratio is consistent throughout the year from 2013 to 2016 which is always above 1.3 indicating that the company is not facing liquidity risk. The other selected companies are in line with Capgemini as well except Sopra Steria with a ratio of 0.96 and it has fall to 0.89 before which could expose the company to liquidity
Its key revenue driver is Application Services which falls under the Technology Solutions which accounts for 60% of its entire revenue. Application Services refers to the development implementation and maintenance of IT applications. Meanwhile as with most service providing companies, personnel cost is the major contribution for its expense accounting for over 70% of its total operating expense. The other three selected companies within the same industries which is used to compared the financial ratios and analysis of Capgemini are:
1. ALTEN: Founded in 1988, it is also a technology consulting firm headquartered in France. The company provides services to its clients in the fields of Innovation, Research and Development and IT systems. The services range from consulting to full project outsourcing. ATEN is currently present in 20 countries across the globe.
2. ATOS: Also based in France, ATOS is an IT services corporation specialized in Transactional & Payment services, Business and Platform Solutions, Cloud and Enterprise Software and Infrastructure and Data Management. Currently it has over 100,000 employees and spread across 72 countries. Besides that, it also involves in delivery and catering services as well as franchises its brand …show more content…
This indicates that the company is unlikely to be exposed to financial risk. All of the other companies within the same sector are also lowly geared with ALTEN, ATOS and Sopra Steria Group having 0.09, 0.25 and 0.66 gearing ratio respectively. It is expected that these type of companies are lowly geared and normally do not leverage unlike company in the financial service industry. The average current ratio of the company meanwhile is 1.43 and the ratio is consistent throughout the year from 2013 to 2016 which is always above 1.3 indicating that the company is not facing liquidity risk. The other selected companies are in line with Capgemini as well except Sopra Steria with a ratio of 0.96 and it has fall to 0.89 before which could expose the company to liquidity