The Board of Directors of Capgemini SE, chaired by Paul Hermelin, convened today in Paris to review and adopt the accounts of the Capgemini Group for the year-ended December 31, 2021.
Aiman Ezzat, Chief Executive Officer of the Capgemini Group, said: “Capgemini achieved a remarkable performance in 2021 in terms of growth, profitability and cash generation. This is a successful first step in achieving our 2025 ambition, driven by the acceleration of demand in cloud, data and AI.
We are positioned as the strategic partner for our clients to succeed in their digital transformation. Our ability to attract and develop talent is a major asset for our sustained growth. Our recently announced ESG policy enables us to leverage the potential of technology for an inclusive and sustainable future.
Building on a good year in 2021, Capgemini will confirm the enhancement of its growth profile in 2022. I have full confidence in the Group’s ability to meet our targeted ambition.”
In 2021, Capgemini’s results exceeded all its targets as further raised in October. In a context of strong global economic recovery, the past year highlighted the acceleration in the digital transformation of large corporations and organizations. The Group is reaping the benefits of its investment in innovate offerings and its positioning as a strategic partner for its clients. This performance is also supported by the successful integration of Altran, which has strengthened Capgemini’s global leadership in the Intelligent Industry and generated the targeted revenue and cost synergies ahead of plan.
Capgemini reported revenues of €18,160 million in 2021, up +14.6% on 2020 published figures. Constant currency growth* was +15.1%, slightly above the raised target range of +14.5% to +15.0%. Acquisitions had a net impact on growth of 4.9 points, mainly due to the consolidation of Altran from April 1, 2020. Organic growth* (i.e. excluding the impacts of currency fluctuations and changes in Group scope) is therefore +10.2%.
The solid growth momentum observed earlier in the year continued in the last three months across all Group regions, both in terms of constant currency growth (+12.5%) and organic growth (+13.2%).
Digital and Cloud services – which account for around 65%[2] of Capgemini’s activity – accelerated steadily throughout the year, reporting strong double digit growth at constant exchange rates, reflecting the priority given by Group clients to critical digital transformation projects. As expected, the Group also benefited from the synergies generated by the Altran acquisition, in particular in the Intelligent Industry market.
Bookings totaled €19,462 million in 2021, a year-on-year increase of +15.8% at constant exchange rates, representing a book-to-bill ratio for the year of 1.07. Bookings rose +10.3% at constant exchange rates in Q4 to €5,726 million, corresponding to a book-to-bill ratio of 1.17.
The operating margin* is up by +25% to €2,340 million. At 12.9% of revenues, the margin rate is significantly above the minimum targeted rate of 12.7% as raised last October. This is 1.0 point higher than in 2020 and 0.6 point above the pre-pandemic level (12.3% for fiscal year 2019). This significant increase in the operating margin rate is underpinned by an improvement in the gross margin, supplemented by lower operating expenses driven by the Altran cost synergies and certain cost avoidance in context of the pandemic.
Other operating income and expenses represent a net expense of €501 million, up €124 million year-on-year. This increase is mainly due to the €120 million capital gain realized in 2020 on the divestment of Odigo.
Capgemini’s operating profit is therefore up +22% at €1,839 million, or 10.1% of revenues.
The financial expense is €159 million, compared with €147 million in 2020. This slight increase is primarily due to the full-year impact of debt charge associated with the acquisition of Altran.
The income tax expense is €526 million compared with €400 million last year. It includes a transitional tax expense of €36 million as opposed to a €8 million income in 2020. Adjusted for exceptional items, the effective tax rate is 29.2%, compared with 33.0% in 2020.
Net profit (Group share) rises by +21% year-on-year to €1,157 million, while basic earnings per share increase by +20% to €6.87. Excluding the capital gain realized in 2020 on the sale of Odigo, the increase reaches +38% for both financial measures. Normalized earnings per share* is €8.97. Normalized earnings per share adjusted for the transitional tax expense is €9.19, up +27% year-on-year.
Organic free cash flow* generation totaled €1,873 million, up €754 million on 2020, largely exceeding the €1,700 million target for 2021 as raised twice during the year. This performance primarily reflects the strong growth in Group revenues and the improvement in its operating margin during the year, combined with a marked reduction in working capital.
In 2021, Capgemini invested €369 million net in acquisitions. The Group also paid dividends of €329 million (€1.95 per share) and allocated €200 million to share buybacks under its multi-year program. Finally, the 8th employee share ownership plan, set-up in the second half of the year, led to a gross capital increase of €589 million.
The Board of Directors has decided to recommend the payment of a dividend of €2.40 per share at the Shareholders’ Meeting of May 19, 2022. The corresponding payout ratio is 35% of net profit (Group share), in line with the Group’s distribution policy.
