The increase in revenue was due to the recent acquisitions, and excluding this revenue would have been flat, and even down slightly on the previous quarter. The acquisitive spell in 2002 meant that BearingPoint doubled headcount over the past six months, through hiring staff and buying up many of its KPMG Consulting partnerships in North America, Latin America and Asia Pacific.
These included the two largest deals, the $63m acquisition of Arthur Andersen Business Consulting in the US, giving it an additional 1,400 staff and annual revenue of $250m, and the $646m purchase of KCA, the German, Swiss and Austrian consulting operations of KPMG DTG, which gave it an additional 2,800 consultants and combined annual revenue in 2001 of $540m.
However, BearingPoint has also made swathing cut backs to maintain its profitability, and this involved cutting 3% of its workforce or between 450 and 550 employees out of its US operations earlier this month, as well as 700 of its KCA employees, or 4% of its European workforce late last year. At the end of the second quarter, BearingPoint now employs 16,689 people, down from 16,915 at the end of the September. However, the acquisitions and cut-backs have taken their toll on BearingPoint ‘s cash position, which at the end of the second quarter had fallen sharply by 76% to $49.3m.
Source: Computerwire
