Europe’s largest computer consultancy Capgemini said yesterday demand is improving but it has yet to see signs of a sustained recovery.
The news will be a blow to the IT sector as the firm is seen as a bellwether for industry spending.
It follows a torrid year’s trading for the market leader, as it was battered by the fallout of the financial meltdown.
Chief executive Paul Hermelin said: “The exit movement from the crisis is very incremental. Our most optimistic scenario is that of an upturn in the second half.”
He added: “What will be decisive will be how fast clients make decisions on projects we are currently discussing. The market is becoming more animated again but it is too early to determine the calendar and the scope of the recovery.”
Hermelin predicted a stabilisation between the first and the second half of 2010. Despite its annus horibilis, Capgemini has around £1bn in cash and remains on the lookout for small targeted acquisitions. It plans to expand in emerging countries, including China and Brazil and in the US public health sector.
It consults on IT systems for high profile clients including the Metropolitan Police, Transport for London, BP and AstraZeneca. The French based firm employs more than 8,000 people in the UK.
In February, Capgemini said like-for-like sales in 2010 would contract by two to four per cent. It expects operating margins to narrow to between 6 and 6.5 per cent from 7.1 per cent last year and 8.5 per cent in 2008.
FAST FACTS | CAPGEMINI
The French-based IT consultancy firm employs 8,000 people in the UK
It carries out work for clients including the Metropolitan Police, Transport for London, BP and AstraZeneca