Focus on FranceING - June 8, 2007
Philippe Donche-Gay CEO West EuropeLuc-François Salvador, CEO SogetiPhilippe Tavernier, CEO Sogeti France
1
Our 2007 Objectives
This will lead us to:9% growth & 7.0% operating margin in 2007
above market growth & 8.5% operating margin in 2008
Improve operational efficiency
Focus on low performing unitsFurther MAP roll-out Favor offshore margin accretion
New leaders developmentGrow Consulting Services Additional vertical offersGrow offshore leverage 1:3
Develop NA
Leverage Kanbay Integration
FSI (NA, UK, test Continental Europe)Non-FSI: regional adjustmentIndia harmonization
Consulting BPO
Prepare for step changes in
2
Q1 was another strong quarter across the board
26.9%1.5%Kanbay
12.0%3.7%CS / TS / LPS / Kanbay
14.2%4.1%TOTAL GROUP
18.1%4.8%Outsourcing Services
8.1%4.6%Local Professional Services
12.3%3.7%Consulting / Technology Services
Q1 07 / Q1 06Q1 07 / Q4 06
At constant rates and perimeter, including Kanbay
3
IT Services today: a tale of two worlds
20%
30%
40%
50%
15% 20% 25% 30%
% R
even
ue G
row
th
Operating Margin %
Tata
Wipro
Infosys
Satyam
Patni
Rankings – Gartner IT Services Worldwide Market Metrics Database April 2007 Kathryn Hale.
-10%
0%
10%
10%5%
Accenture
ATOS
LogicaEDS
IBM
CSC
Capgemini
#1 Listed European IT Services Company1st European to move massively offshore:
+92% 2006Q1’07 continues growth momentum:
+18% revenues
4
The landscape is due to change
-10%
0%
5%
10%
15%
20%
25%
10% 15% 25%
% R
even
ueG
row
th
Operating Margin %
Revenue, Growth & Margin
Global Western Leaders
5%The Pack
OffshorePlayers
OperatingMargin
Price Pressure
5
An in-depth transformation is needed
Higher Share of walletBetter RetentionLeveraging references
Higher mark-upSector dominanceFaster diffusion
Lower costsHigher productivityConsistent quality
InnovationIndustrialization
Intimacy
6
Intimacy : from Vendor to Partner for our largest Clients
30 Group / Country Managed Accounts
Bring the full strength of our Group to our clients
50% above average growth in the Group
51%
37%
12%
CMA 2006
2 Disciplines
1 Discipline3 and 4 Disciplines
20%
70%
10%
CMA 2010
2 Disciplines
1 Discipline
3 and 4 Disciplines
7
Balanced Pyramid
PMs & Test Managers
SMEs & Relationship Managers
BAs and Architects
Senior Developers
Developers
Offshore Onsite
12MS technologies
13Java technologies
11Database
31Programming conceptual
5PM, Process
14Testing
86Industry certifications
245Capital Markets certified
352Capital Markets trained
#CertificationCertifications & Training
Kanbay microcosm
model
• Integrated “one team”concept
• Balanced skill distribution
• Relevant Industry experience
• High onsite-offshore leverage
• High pyramid leverage
• Full spectrum of trainings & certifications: technology, industry, leadership
x 50
Capgemini India
12 000
226 412 11261934
3679
6000
2001 2002 2003 2004 2005 2006
2001
2006
Industrialization is not just about offshore capacity
8
Industrialization will drive us towards the right model
0-30%
30-60%
60-80%
Capacity Capability Partnership
Offshore leverage
One Team
Model 1:people
assignment
Model 2:KPI alignment
Model 3:strategic
partnership
NA
BPO
LPS
Kanbay
NL Fr UK
9
But can be done smoothly assuming benign market conditions
+3% y/yOnshore
Offshore
54,300(80%)
60,000(60%)
67,600 FTE 100,000 FTE
Subs
Subs
+32% y/y
2006
2010
13,300(20%)
40,000(40%)
Billing consultants
10
Innovation is “Top of the Mind” for our Clients
Our clients are clearly back in a growth cycle
Commoditization is unavoidable in most Industries
Innovation is again central in the CXO’s agenda
Collaboration
ProfitableGrowth
Innovation Productivity
11
Innovation: key to add value
Invent Engage Exploit & Refresh
Process &Governance
I. II. III.
IV.
Identify Leverage/Accelerate Optimize/renew
CM
%
Time
Business/Technology Vision 2010
Emerging Offerings
Domain Expertise and Solutions
“powered by India”
Focus on FranceING - June 8, 2007
13
Capgemini is the #1 professional services provider in France
2 billion euros revenues (Q1 annualized)
6.6% Growth in Q1 07
Capgemini Revenue 2006
17%
28%
6%14%
7%
24%4%
1%
Benelux
NorthAmerica
UK & Ireland
Nordic
Central Europe
France
South Europe
Asia
FY 05 H1 06 H2 06 FY 06
CS-TS 7.9% 7.9% 10.1% 9.0%
OS -20.7% -33.3% -44.7% -39.4%
LPS 5.2% 4.5% 6.9% 5.7%
TOTAL 2.6% 0.7% -0.1% 0.3%
Operating Margin
14
The financials situation has greatly improved !
Operating marginRevenue evolution
-25
0
25
50
75
100
2003 2004 2005 20060
250
500
750
1000
2003 2004 2005 2006
CAGR> 40%
Utilization
70,0%
74,0%
78,0%
80,0%
84,0%
H1 03 H2 03 H1 04 H2 04 H1 05 H2 05 H1 06 H2 06
CS TS
72%
82,2%
SupportFunction Costs
France
0%
5%
10%
15%
20%
H1 04 H2 04 H1 05 H2 05 H1 06 H2 06
`̀
14,8%
10%
15
Capgemini Consulting leads the pack in France
* Results from the PAC 2006 study"Panorama du conseil en France : Analyse du marché et positionnement des acteurs 2005-2009"
1 Capgemini Consulting2 McKinsey (dont BTO)3 Boston Consulting Group4 Accenture5 CSC6 IBM BCS7 BearingPoint8 AT Kearney9 Ineumconsulting10 Sopra Group11 Eurogroup12 Roland Berger13 Bain14 Mercer Management Consulting15 Unilog Management
Market evolution *
0
500
1000
1500
2000
2500
2005 2006 2007 2008 2009
Thought leadership Transformation
International practices
HR : Talent’s battle
Growth5% year
PANORAMA *
16
Grow in value : A differenciated strategy
Be recognized as “Best in Class”In the market
Transformation & Operations
Growmarket share
Stratégie et Transformation
Volvo
Nissan
PSA
CA
Bobst
La poste
Michelin
SchneiderGroupama
Véolia
AirFrance Covea
BNP
ATAC
Total
SNCF
CEMinFi
EDF/GDF
Unedic
% Contribution
COR
Suez
17
Capgemini “Rightshore” strategy is paying off
Recent WIns
AM IM Packages CSD
Grenoble (BI)
Clermont-Ferrand (Cobol)
Lille (Oracle)
Nantes (Finance Mainframe)
Paris (ADC)
Toulouse (SAP)
ParisLille
Toulouse
Nantes
Grenoble
Clermont-Ferrand
Mumbai
Hyderabad
ChennaiBangalore
KolkataPune
18
SOA is key to Financial Institutions
After : Customer centric model
-
Distributor
ProducteurP
Before : Product centric model
Customers Customers Customers
MO
RTG
AG
E
Third
par
tyC
ON
SUM
ER
LOA
NS
PER
SON
AL
AC
CO
UN
T
Reduce cost
Customer
Real time intelligent interaction
Third partyConsumer
Loansfactory
P
P
Mortgagefactory
DifferentiateProducteurP
19
The Three Related Worlds of IT
EnterpriseData
Management
Enterprise Systems
Architecture
The Consumer
Internet CUSTOMER
&
USER
INTEGRATED
EXPERiENCE
The Internet WorldWide Web Web 2.0
Client Server nTier & Components
Service Oriented
RelationalData Base
Data Warehousing
& BI
MasterData
Management
People
Processes
Information
20
The priorities of transformation at TS France
OFFSHORE - AMOFFSHORE - AM
PRODUCTIVITY PRODUCTIVITY
APPLICATION CONSULTING APPLICATION CONSULTING
SAP - ORACLESAP - ORACLE
BI - DATA MANAGEMENT BI - DATA MANAGEMENT
21
Capgemini et Sogeti are building the IT of RWC 2007
22
Sogeti Geographical presence
−Revenues 2006 € 1.3 billion−A workforce of over 17,000 staff spread over 200 locations.−2006 : opening of new geographies (Ireland, Denmark, UK).
U.S. (13.1%)
France (52%)
Spain (4%)
Sweden(5.9%)
Benelux (7.1%)
Germany (0.4%)Switzerland
(0.6%)
Netherlands(16.9%)
23
Sogeti business lines
High Tech ConsultingEngineering R&D Embedded softwareScientific calculationEngineering sciences
*Figures at 31/12/05
Application ServicesAudit, Consulting, Project ManagementSoftware DevelopmentTesting, ERPApplication Management
Infrastructure Services
Audit, Consulting, ProjectManagement, InsourcingSecurity, Rollout, Help Desk
15%
33%
52 %
AS IS
HTC
24
Sogeti Breakdown by sector
Sogeti Group revenues 2006 : € 1.309 billion
35%26%
9%
12%
17%
Industry
ServicesTelecom
Bank & Insurance
Public & Utilities
25
Sogeti Top 11 Clients
ALCATEL
BNP PARIBAS
CEGETEL
EADS
EDF
FRANCE TELECOM
GDF
ING BANK
PSA
RENAULT
SOCIETE GENERALE
Top 11 clients : 27 % of revenues in 2006.
26
Sogeti : an organisation on a human scale
−Flexibility and rapid adaptation to the market,−Entrepreneurial spirit,−200 locations worldwide,
A market sector
A business line
B.U. manager
Assistant
Client Representative
P&L Responsability
Technical manager
A territory
Business Unit
27
Presentation Sogeti France
CA 2006 : 659 M€ ( 7,19 %) 8591 BILLING FTE
PORTFOLIO MANAGMENT AND OFFERINGSIMPROVEMENT ON CONTRIBUTION, C.O.R.
GROWTH AT 8 % AND GOP IMPROVEMENT OF 1.5 pt
29%
44%
27%
IS+4,4 %
3806 CSS
HTC+ 16 %
2372 CSS
AS+ 4 %
2333 CSS
Focus on FranceING - June 8, 2007