A few thoughts about Akka’s performance in Q1 2019
Akka has a somewhat soft financial performance in Q1 2019. The company’s organic (CC/CS) revenue growth reached 6.6%, impacted by a lesser number of working days yoy, a 0.5% sequential decrease in its headcount, and by high attrition (20.8%, up by 230 bps yoy).
Surprisingly, despite its increase in its attrition and its slight decline in headcount, Akka’s utilization rate was down (by 20 bps yoy and by 90 bps sequentially), probably impacted by the traditional project slow starts of the new year.
Akka under-performed Altran (+8.1% at CC/CS) and Alten (+12.5%) quite significantly. However, we view this underperformance as a hiccup in the activity of a firm that has a track record in high-single-digit organic growth. Having said that, we can’t help noticing that Akka’s guidance for the year is an organic growth of at least 6%. The guidance is on the low side and well below market performance.