Cap Gemini - Registration Document 2016

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FINANCIAL INFORMATION

4.1 Analysis on Capgemini 2016 Group consolidated results

development of APIs (customer interface for communication of ◗ major global bank; software components) to power a new Digital platform for a company for innovation and transformation, was asked to Capgemini is the preferred partner of a French mass catering more than 10 Digital projects; mentor the Digital transformation of the Company and steer operator; major Digital transformation contract with a European telecoms ◗ 7-year service agreement with a US insurance company ◗ Business Administration Services); delivered through Capgemini’s IBAS platform (Integrated manufacturer; digital transformation consulting assignment for a European car ◗ submarine systems; cloud-based Big Data & Analytics assignment for global leader in ◗ cybersecurity assignments for a leading European insurance ◗ a cruise ship operator; company, an environmental agency, a Dutch discount chain and a top-three European airport; systems integration and infrastructure consulting assignment for ◗ supplier; implementation of Digital applications for a Digital camera biotechnology company; launch of a strategic transformation plan for an agricultural ◗ 5.2% (+7.9% at constant foreign exchange rates). Operating December 31, 2016, compared with €11,915 million in 2015, up 2015. expenses total €11,099 million compared with €10,653 million in personnel costs (+4.8%) to €7,611 million for 2016. Personnel An analysis of costs by nature highlights a €351 million increase in 2015. The average headcount rose 15.1% in 2016 to 185,593, costs represent 60.7% of revenues compared with 60.9% in 56% of the total Group headcount, compared with 54% in 2015. compared with 161,268 in 2015. Offshore employees represent An analysis of costs by function reveals: the cost of services rendered is €9,183 million, or 73.3% of ◗ improvement in the gross margin to 26.7% of revenues in 2016; revenues, down 0.9 point on 2015. This enabled an percentage increase on last year; selling costs total €1,032 million, or 8.2% of revenues, a slight ◗ revenues), a reduction of 0.2 point on 2015 as a result of a strict general and administrative expenses total €884 million (7.0% of ◗ cost control policy. The operating margin is therefore €1,440 million in 2016, or 11.5% of revenues compared with 10.6% in 2015.

automation of testing and transformation for a US finance company; the food retail business in the United Kingdom; phase on a Digital customer engagement for a brand devised for building a new membership program, data model, deployment ◗ transformation program for a German automotive equipment ◗ Product Lifecycle Management (PLM). manufacturer to adopt next generation Digital technologies for in 2016: Finally, the following contracts illustrate other commercial activity Capgemini secured its position as a strategic supplier to HMRC ◗ collection) notably in application development and management (the UK government department primarily tasked with tax being one of the world’s most digitally advanced tax authorities. services through to June 2020 in support of HMRC’s ambition of Capgemini will transition a number of services between now and In support of HMRC’s decision to take greater control of IT, June 2017 (March 2016); Capgemini announced the renewal of its managed services ◗ contact with the UK Ministry of Defense (March 2016); company based in the US to manage all IT applications and deliver end-to-end ADM services (September 2016). Capgemini signed a contract with a global medical technology ◗ €52 million is mainly due to integration costs as well as the 2016, compared with €240 million in 2015. This increase of IGATE acquisition over 12 months in 2016. amortization of intangible assets recognized in the context of the Operating profit is €1,148 million (9.2% of revenues) compared 12.3%. with €1,022 million (8.6% of revenues) in 2015, an increase of (€118 million). This rise is mainly due to the recognition of the The net financial expense is €146 million, up on 2015 coupon on the 2015 bond issue for a full 12 months in 2016. An income tax expense of €94 million is recognized in respect of This is due to the remeasurement of deferred tax assets on US tax 2016, compared with income tax income of €203 million in 2015. income (net) of €180 million in respect of goodwill arising on legal loss carry-forwards in 2015 in the amount of €476 million and tax restructurings in 2016. Adjusted for this non-recurring item, the 2015). effective tax rate is 27.3% in 2016 (compared with 30.1% in €921 million in 2016, compared with €1,124 million in 2015. Basic Profit for the year attributable to owners of the Company is 169,450,721 ordinary shares outstanding in 2016, compared with earnings per share are €5.44 based on an average of outstanding in 2015. €6.67 based on an average of 168,452,917 ordinary shares

and outlook for 2017 Comments on the Capgemini Group consolidated financial statements 4.1.2 Consolidated income statement Consolidated revenues total €12,539 million for the year ended Other operating income and expense (including the combinations) represents an overall net expense of €292 million in amortization of intangible assets recognized in business

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Registration Document 2016 — Capgemini