Good morning, everyone. I'm delighted to welcome you here today for, actually, my last full year results as CEO of Capgemini. As everybody knows, Aiman Ezzat will take the reins in May. Unfortunately, he's ill today, and we expect to see him back in a few days. For this last time, I will present the materials we have prepared together and share with you the group guidance for 2020. I will be joined nevertheless by Rosemary Stark, our Chief Sales Officer, and Carole Ferrand, our Chief Financial Officer. Strong set of results. 2019 was another very solid year for the group in a more challenging economic environment. Our revenue is growing by 5.3% in constant currency. We warned you about some slowdown to happen in the fourth quarter. We end up with 2.9% growth in Q4.
We faced headwinds in North America and in financial service, which were stronger than what we expected. We continue to grow by more than 20% in digital and cloud. The shift to the new portfolio we initiated a few years ago proved to be successful. It represents now more than 50% of our total revenue for the first time on a full-year basis. We are very happy with the significant level of bookings, growing by 11% for the full year and peaking at 16% for the fourth quarter. Our operating margin, having progressed by 20 basis points, is reaching 12.3%. In terms of free cash flow, the performance of the group is particularly satisfying, growing by 16% and reaching a new high at EUR 1,288 million. Our normalized earnings per share grew by 12% to peak at EUR 6.76, an amount never reached before.
We will propose to our shareholder meeting a dividend of EUR 1.90 per share, an increase of 12% compared to last year. About the progress, I want to point out four domains where the group particularly progressed and reaped the rewards of our strategy. First, we gain agility in the way we manage our portfolio of offerings. We are on the cutting edge of each and every new technology. This agility allows us to enjoy the position of leader in public cloud migration recognized by cloud providers. We also gain agility with our firm and partners. Our business with them grew in 2019 by 40%. Our appetite for partnership is not limited to IT. Last week, we announced a key partnership with Ericsson in the 5G field. Second reason for progress, our client intimacy. This is the direct outcome of our new go-to-market organization.
I can give a few examples that illustrate it before coming to the success of Bayer. First, a three-year contract with Volvo for the digital and cloud transformation. Second example, our long-standing relationship with Coca-Cola leading to Kona Services. We support Coca-Cola Northern Bottles to bring its bottles into the digital age with cloud infrastructure and data. Third aspect on which we progress, Capgemini Invent. You remember we launched it at the end of 2018. It is our platform dedicated to CXO interaction to manage digital transformation. A year down the line, it shows outstanding results with more than 15% of total growth year on year. Furthermore, Invent became more attractive to recruit new experts in data, content, or marketing. Last but not least, we continue to widen our skills through targeted acquisition in cybersecurity with Leidos and in the industrial sector with Conexys in Germany.
I am very pleased with the latest one, Purpose, one of the world's leading social impact agencies ever since its birth in 2009. Purpose helps nonprofit organizations, philanthropies, but also commercial companies to have a meaningful social impact. Combined with Capgemini Invent, Purpose will further support clients to transform their business model through campaigns, branding, and creative content. A word on Altran. On Altran, we have announced our intention to carry out this strategic move last June. Month after month, I am more and more convinced this is the right step for both of our companies. Together with Altran, we will play a leadership role in the intelligent industry world. Altran is an accelerator for our strategy in this domain. You already understood the point.
By joining our skills, we will assist our clients in taking full advantage of the revolution created by cloud, edge computing, Internet of Things, artificial intelligence, and of course, 5G. Our teams are ready to collaborate, and the market supports this strategic choice. We passed a decisive step a few days ago, but as you know, it's not the final one. We are confident we will reach the final step of completion. We now wait for the decision of the courts expected on March 19 with serenity. A word on Bayer. Let's focus on this major Bayer deal. We signed it last December. Bayer partners with us to drive their digital transformation through the implementation of a new IT operating model focusing on new digital capabilities. This deal is about agility, innovation, and cost optimization. Crucial to this is the ability to perform while transforming Bayer.
We were able to show our track record in enabling large complex transformation with other clients while ensuring operational stability, for example, with HMRC. Our track record of robust and reliable delivery at Bayer has also been crucial. Just as critical is our ability to embrace Bayer's employees. As a result, we have been able to bring strong employee focus to the Bayer team who are transferring across to us. Of course, our entire proposition is underpinned by our skill and our ability to infuse innovation at the core of what we do. It's a great success I'm very proud of. Ready to go further. To finish, I can't resist sharing my views on the progress the group made these recent years. The group is strong today thanks to, first, a steady financial performance. We achieved a significant journey on many financial perspectives.
We have already strengthened our growth profile, and we continue to invest to lift it further. Our operating margin is up for the ninth consecutive year from 7% in 2010 to 12.3% in 2019. Over that period, our cash generation was multiplied by 3.6 from EUR 359 million in 2010 to EUR 1,288 million last year. Our cash generation put us among the leaders and certainly at the top in Europe. Our profitable growth model demonstrated its robustness. Second, a worldwide player. Our geographical balance is well balanced or at least better balanced. Since 2010, the size of the non-European business has doubled thanks to our organic growth and to acquisition. The U.S. represents a third of our business now. We have also opened new fields like South America, and we grow fast in Asia-Pacific. Third, India is certainly a success. We settled there in 2000 and now.
One, we now operate over 30 offices across 12 cities. India is the largest contributor to our global delivery model, but also an incredible pool of well-trained talent. We recruit here nearly 30,000 people a year. India is also one of our assets on the innovation path. Fourth and last, something I am personally committed to, business for society. We launched two years ago a CSR program named Architects of Positive Future. It is based on three commitments, gender diversity, digital inclusion, and environmental sustainability. We progress well on these three domains. As a leader of transformation, I strongly believe that we need to go further because technology can be leveraged to cope with our societal stakes, climate change, of course, but also health and social care. For instance, we support the Institute Curie against cancer with our AI capabilities.
On the climate front, we help our clients build and deliver a carbon strategy. This is the way we can claim we are a responsible company, and we are convinced it plays on our attractiveness as an employer of choice. Glassdoor's analysis shows us that our actions are paying off by having gone from 3.3 rating to 3.7 in less than a year. On all these points, I know and I'm sure Aiman will be fully engaged to shape the future of our commitments. Another key achievement I want to highlight and that I'm particularly proud of, for the seventh year in a row, we have been ranked by Ethisphere as one of the world's most ethical companies, and I hope we will remain on top of this ranking this year. I'll now pass the hand to Rosemary, who will detail our sales performance.
Thank you, Paul, and good morning to you all. 2019 was a strong year for bookings with EUR 15.1 billion bookings and 11.3% growth year- on- year at constant currency. Quarter 4 2019 was an excellent quarter for bookings, our largest ever at EUR 4.6 billion. This is an increase of more than 16% year- on- year at constant currency. With digital and cloud now accounting for 60% of the bookings in 2019, the progress in our portfolio shift is evident. We start 2020 with a strong pipeline showing double-digit growth year on year and with a healthy number of large deals in progress. We're seeing an increasing number of clients assessing the opportunity to drive business transformation through structured outsourcing. They want to embed cloud and digital in their business DNA and drive cost efficiency.
These deals are evidence of our ability to transform our India delivery for clients to create client intimacy and to enable proactive deal creation. Now moving on to revenues, we've delivered 5.3% constant currency revenue growth in 2019 with 2.9% in Q4. 2019 saw 9.1% growth in services with strong growth in France and in North America. In both manufacturing and energy and utilities, we've performed well at 8.5% and 8.2% growth respectively. Manufacturing growth was driven primarily by France and by Asia-Pacific, while the U.K. and Europe delivered the key growth in energy and utilities. As we discussed during our Q3 results, financial services continues to experience a softer market in banking. In Q4, we saw tight year-end spending controls from many banks. Insurance, however, continues to grow well.
Public sector, our fourth sector, at 14% of our revenues, grew well in France, Germany, and Asia-Pacific, while in the U.K., public spending in Q4 was definitely affected by Brexit. Moving on to look at some of our deals. Q4 delivered some excellent winning for us. As I mentioned, there's an increasing number of transformational deals as our clients look to really build digital into their DNA while managing their costs. Paul covered the landmark deal at Bayer, so let's look at a few of our other wins. For an international discount, DOJ capitalized costs, a complex five-year deal including migration of the client's landscape to the cloud and applications run. It's the first of a new type of deal where our fees are tied to the client performance and delivery will be located out of Netherlands, Poland, and India.
Capgemini has been chosen by telecoms operator TIM Brasil, the Brazilian subsidiary of Telecom Italia, to foster artificial intelligence and robotic process automation. We are doing this through a new contract focused on cognitive innovation. In energy and utilities, we have signed a five-year mega deal for a U.S.-based integrated energy company. The agreement covers application and infrastructure management across their generation, transmission, and distribution, and energy and retail businesses. It also covers consulting and project services, and delivery will come from the U.S., India, and Poland. Moving to financial services, for the Netherlands pension fund, we have closed a 10-year partnership to set up the business and the IT operations for the administration of around 1.2 million pensions.
For MAN Truck in the automotive sector, part of the Volkswagen Group, Capgemini has just won its largest sales force implementation deal in Germany and will be designing a cutting-edge digital CRM tool that will enable the sales representatives of MAN to sell effectively with a 360-degree view of their customers. Just some of the interesting deals closed in Q4 2019. I'd like to hand over to Carole now to take you through our financial results. Carole.
Thank you, Rosemary, and good morning, everyone. Let me now walk you through the financial highlights of our full year 2019 results. Before that, please note that I have resumed even though it is January 1 and therefore applies to all 2019 financial information in this presentation. You will find in the appendix section more information on the impact of our financial statements as well as the revised definition of our organic free cash flow and net debt. Group revenues amounted to EUR 14,125 million in 2019, up 7% at current exchange rates and 5.3% at constant rates. This performance comes in line with our guidance as revised in Q3 at around 5.5%. The operating margin reached 12.3% of revenues, up by 20 basis points year on year, so the bottom point of our guidance ranged in the full year.
In a mixed economic environment, the group demonstrates once again its ability to continue to combine growth and profitability. The net profit group share reached EUR 856 million for 2019, up 17% compared to 2018. The normalized EPS stands at EUR 6.76 before the transitional U.S. tax expense. Finally, we generated an organic free cash flow of EUR 1,288 million for the period compared to EUR 1,160 million in 2018, well above our target from 2019. As you can see on the next slide, this represents a massive improvement since 2010. Our performance in 2019 was once again driven by the strong improvement in our operating margin and by a remarkable 74% cash conversion. We aim at increasing our organic free cash flow in the years to come. However, in 2020, we will have to account for EUR 150 million of headwinds coming from working capital and higher cash tax payments.
With respect to our capital allocation, acquisitions represented a net cash outflows of EUR 578 million overall in 2019. This does include an amount of EUR 411 million for the acquisition of our 0.11% stake in Altran in last July, excluding taxes. Other investments relate to the acquisition of Leidos Cyber in the U.S. and Conexys in Germany. Furthermore, we returned last year to our shareholders a total amount of EUR 432 million, of which EUR 282 million dividends and EUR 150 million share buybacks. Thanks to the strong cash generation, the group net debt is down to EUR 600 million at the year end. This compares to EUR 1.1 billion at the beginning of the year, as we stated for IFRS 16. Moving on to our quarterly revenues now. Q4 organic growth stands at 2.2%, which brings our organic growth for 2019 to 4.2%.
With the contribution from our acquisition, the constant currency growth reached 2.9% in Q4 and 5.3% for the full year. The fix remained the same with this year, leading to a 1.7 percentage points positive impact overall in 2019, largely due to the appreciation of the U.S. dollar against the euro. Finally, our reported growth reached 4.2% in Q4 and 7% for the full year. Moving now on the revenues by region. As usual, to be consistent with our guidance, I will only refer to constant currency variations. North America first, our largest region with 32% of group revenues, grew by 2.6%. As you know, this compares with a striking 14.4% growth in 2018. The service and energy and utility sectors were the most dynamic sectors in 2019. U.K. and Ireland posted a solid performance with a 4.7% growth.
This in spite of the slowdown recorded as anticipated in the final months of the year. The manufacturing, energy and utilities, and consumer goods and retail sectors were the main growth drivers, while the public sectors remained almost stable. France achieved a robust 5.9% growth. Demand was fueled in particular by the manufacturing, services, and public sectors. The rest of Europe grew by 6.2% with robust demand in energy and utilities, consumer goods and retail, and manufacturing sectors. Finally, Asia-Pacific and Latin America are keeping their momentum with a 12.8% growth in 2019. All our main verticals contributed to another strong year in this region. Now let's look at our revenue by business lines.
First, let me remind you that since January 1, we measure our activity level by the constant currency growth of the total revenues generated by each business line, so before the elimination of internal billing between business lines. Strategy and transformation represents 7% of group total revenues, posted a robust growth at 15.1% of its total revenues in 2019. Our growth was driven mainly by the manufacturing, energy and utilities, and TMC sectors. Application and technology are core business lines with 71% of total group revenues, increased by 4.8%. The services, energy and utilities, and manufacturing sectors were the most dynamic ones in the past year. It's worth noting that we maintain our strong momentum in digital and cloud, with a growth exceeding again 20% at constant currency this year. However, our traditional activities recorded stronger erosion in Q4 compared to the first nine months of the year.
Lastly, operations and engineering, which represent 22% of group total revenues, increased its total revenues by 4.9%. These business lines benefit from the group's growing success in multi-year contracts, especially for cloud infrastructure services. Digital engineering and manufacturing services continue to develop at robust pace, illustrating the focus on intelligent industry. Moving now to the headcount evolution. Total headcount reached 219,300 employees at the end of 2019, up 3.8% year- on- year. With the evolution of our business mix, our average revenue per head continued to increase, and our revenues are growing faster than our headcount. Our workforce in global production centers grew by 3.2%, pushing our offshore leverage slightly down to 57% versus 58% in 2018. Actually, it does represent only a 0.3 point variation year on year before rounding.
Finally, our attrition stands at 20% for 2019 on an updated methodology basis in order to close the industry practices. This is a higher level than what we would like to see, but it does remain manageable. Now moving on to our operating margin by region. In North America, the operating margin improved 30 basis points year- on- year to 13.9%, with a noticeable improvement in H2 despite the business deceleration at the end of the year. In the U.K. and Ireland, our operating margin jumped to 15.2% compared to 12.6% in 2018. We are back to 2016, 2017 levels. In France, our operating margin has further improved by one point at 12.1%. I am pleased to highlight that France has now closed most of the gap with the group average operating margin.
Conversely, the operating margin of the rest of Europe eroded from 13% in 2018 to 11.8% in 2019. However, we do believe that the margin prospect for that region remains intact. Our operating margin in Asia-Pacific and Latin America is also down at 11.2% compared to 12.8% the year before. Moving on to the analysis of our operating margin. The 20 basis points improvement in operating margin is a direct full-through of the similar increase in gross margin. This brings the gross margin improvement over the last six years to 300 basis points. In terms of OpEx, the slight increase of our selling expenses, 10 basis points, is offset by a similar decrease in G&E costs. This performance once again illustrates that our margin drivers are coming from increased value creation with a more favorable business mix. Moving on to the next slide.
Net financial expenses are almost flat compared to last year, down by EUR 1 million. Income taxes are up by EUR 55 million year- on- year. Within the amount, the transitional impact of the U.S. tax reform represents a total of $60 million this year compared to $53 million last year. Setting this item aside, our underlying effective tax rate is down to 32.6%. As opposed to our cash rate, I remind you that we expect our ETR to further go down in the coming years to stand at around 30% in 2022. Finally, let's go through the recap of our P&L from operating margin to net income. Other operating income and expenses decreased by EUR 38 million to EUR 308 million in 2019. This is mainly due to our restructuring costs, which are down to EUR 82 million for 2019, as expected, compared to EUR 122 million in 2018.
Overall, our operating profit for 2019 is up 15% to EUR 1,433 million. The net profit group share amounts to EUR 856 million, up by 17%. Thanks to our share buyback policy, our weighted average number of outstanding shares is down again this year by almost 1 million shares. Our reported basic EPS stands at EUR 5.15, up by 18% compared to last year. Our normalized EPS amounts to EUR 6.76 after restatement of the transitional U.S. tax impact. Turning now to 2020, on the back of our solid bookings, our focus will be to confirm our capacity to increase our growth rate throughout the year, to maintain a strict discipline and control both on operating costs and on investments, and lastly, to provide a superior cash conversion profile, as well as to confirm our financial robustness and reliability.
In terms of capital allocation, with the EUR 1.90 per share dividend announced by Paul and the EUR 20 million share buyback that we will be starting in the coming days, returns to shareholders will exceed EUR 500 million in 2020. This new share buyback program is consistent with our view that there is more value today in buying back Capgemini shares at EUR 117 than buying some extra Altran shares at EUR 14.50. With that, I leave the floor to Paul for closing remarks.
Thank you, Carole. As I mentioned before, I'm now covering Aiman's section and sharing with you his prepared remarks. Looking forward to 2020, we will continue to deploy our strategy focused on innovation and industrialization while focusing on three areas. First, on growth and profitability. We will focus on restoring the growth engine in North America and financial service. I will detail that further just after.
2019 was a strong booking year. It was driven by transformational deals that we shaped with our clients that will remain a focus in 2020. As part of our relentless drive, we'll keep pursuing our industrialization strategy for the group. On the leadership front, two priorities Aiman will mention. An important focus will be on developing and deploying our intelligent industry strategy. On the data front, we will leverage our insight data capabilities across our portfolio, bringing artificial intelligence across all our offerings. Finally, I want to keep moving forward on the talent front. In 2020, the group will keep promoting a culture of great place to learn, develop, and work for our employees. Strong achievements were accomplished last year, as shown by the Glassdoor ranking progress, as well as several great place to work rankings opened.
Also, the group must continue its effort to encourage a diverse, inclusive, and responsible workplace. Continuing on our efforts on diversity, for which I oversee personnel, the program is paramount, as well as our progress on digital inclusion. The main priority on the CSR front for me this year is to act on climate change. For 2020, I want the group to improve significantly on sustainability internally and for our clients. I'm convinced that we can help our clients towards a sustainable business model. North America and financial service. In North America and financial service, we did not finish the year on the expected growth trajectory. Action plans have been launched, and some major wins in the fourth quarter will support a strong change of trajectory starting in H2. Beyond regaining momentum, I want to put North America on a sustainable growth trajectory.
Some axes of the ongoing transformation plan are an increase of the focus on strategic geographic hubs in the U.S., while increasing our operational maturity in order to fully leverage the benefits of account-centricity. This will better leverage our new operating model. Our growth is about above 20% in the new, and it's coming with better margin. We had this year a higher erosion in North America in what I call core IT. The focus is not only to continue, but to transform some of our more traditional business to accelerate overall growth. Finally, we will continue to strengthen and grow key alliances in cloud and digital with our strategic partner. In financial service, we suffered from the external environment, notably in the banking sector. We have historically resisted better than our competitor, but the last two quarters were more challenging.
We are confident we will get back on a good growth trajectory in the course of 2020, focusing on proactively shaping transformational deals driven by efficiency and agility, leveraging technology transformation, accelerating the rollout of our next-generation banking insurer business models with our inventive banking and inventive insurer offers. Finally, leveraging the new ecosystem with fintech, insurtech, regtech, expanding our key alliances and partner footprints. To conclude on the 2020 outlook, Aiman is speaking because he will have to deliver. As we look at 2020, based on a slow start and on an H2 that we see getting back close to 35%, we expect revenue growth to be around 4% constant currency for the full year, with a limited impact from acquisition close to half a point.
In H2, we will be close to our medium-term organic growth ambition, but clearly for the full year, we will be below that level. However, I am still confident that this is the right level of ambition for the group, and we aim to get back on track by next year. On the margin front, we aim for another progression with an operating margin of 12.4%-12.6%. This will be our 10th consecutive year of margin expansion. On the organic free cash flow, considering the EUR 150 million of negative headwind that Carole mentioned around working capital and cash tax, we target around EUR 1.2 billion. With this result, the group will feature again an excellent conversion ratio from net profit to cash. These numbers, of course, exclude any impact from the Altran acquisition. We will provide you with an update after the court ruling at the first quarter publication. Thank you for your attention, and we are now ready to take your questions.
Ladies and gentlemen, if you wish to ask a question, please press zero one on your telephone keypad. The first question comes from Adam Wynn from Morgan Stanley. Sir, please go ahead.
Hi, good morning, everyone, and thanks for taking the question. Congratulations, Paul. Wish you all the best when you move on as Aiman takes over. Maybe just two, if I could, please. Just first of all, on this mixed shift in the business between the digital and cloud piece of the business and then the older part of the company. Obviously, the digital and cloud part is still growing very nicely and is becoming the majority of the company overall. Could you just talk a little bit about the impacts that has, first of all, on top line?
That weakening in the older part of the business, would you say that is more of a structural trend that you see that continuing because there is greater commoditization and greater price pressure from competitors? Was that more an ad hoc thing in the fourth quarter where it was Brexit elections that meant that was just a short-term impact? Can we also talk a little bit about the impacts on margins? I noticed the offshore mix actually came down through the year. Again, do you see that being a structural trend? What impact would that have on margin improvements going forward? Just a few thoughts around that would be helpful. Maybe just very quickly on the U.K., obviously weak in the fourth quarter. Could you talk a little bit about bookings and what you've seen so far in Q1 that may or may not give you comfort that that's starting to improve? Thank you.
Thank you, Adam. The first point is I really think what Aiman has in mind is erosion in what he calls core, which is the non-digital, non-cloud, has been quicker or sharper than the market trends. He thinks there was a little lack of attention, maybe too much mobilization, notably in the U.S., that was part of what I read from his remarks. He thinks we should refresh a little bit our offerings in the core technologies by ingesting probably more data science and data analytics. So one of his priorities at group level, and certainly in the U.S., is to increase our focus. There's a word on digital and cloud.
We will not have a permanent 20% growth, so we shoot for mid-teens this year. That will still be accretive to our growth, as you see, with a good impact on margin. On the margin, I would not necessarily blame extreme price pressure on core. I think it is more about us and maybe with the new lead model focus on the new portfolio, the new territories. He is trying to refocus everybody. That is why I think the main word of what he has in mind, notably for North America, is what he calls maturity. We do not have to transform North America. He has organized, he has been there very actively. Some reinforcement in management, not on the front end. The front end works well. We have a nice pipeline, but it is more the maturity of the operation.
You may have seen that the margin in North America has increased, notably in the second half, which is a good sign. By the way, it showed that we resist on prices. You may have seen in some public survey that Capgemini has the reputation of being one of the players that really resist on price. Last question, Adam, was on the U.K. We still expect a negative figure in Q1, and we will come back to a balanced figure in Q2. We have a good pipeline. Since we have a flow of projects and some signature, we expect a positive H2. Apparently, I forgot a question. The question—no, I think I said it on digital. We confirmed that digital and cloud are accretive, and that has helped us, certainly, notably in the U.S. You see the margin progression. That's because one thing that works well in the U.S. is digital and cloud. It's on the core technologies that we have lost a little bit, or maybe we are not hungry enough. It's probably about us, and it's what I call the question of maturity.
That's helpful. Thank you, Paul.
Thank you, Adam.
The next question comes from Stefan Slowinski from Exane. Sir, please go ahead.
Yes, hi. Thank you for taking my question. Just trying to follow up on the previous question around the confidence and the recovery in the second half of the year. You mentioned the U.K. still being weak in Q1. From our recent discussions with some software services companies, it seems like there's still a lot of uncertainty in the U.K., still a lot of lengthening of deal closures, still uncertainty around the resolution there. What gives you confidence in the U.K. that you should see a recovery in the second half? I guess more broadly as well in the U.S., you mentioned some deal wins there at the end of the year. Is there any other detail you can give us as to why you feel like the second half of the year should see an acceleration compared to the first half? Thank you very much.
Stefan, I've supported Aiman in his investigation about the full year profile, and I've seen the figures that came bottom up. We have a nice pipeline of large deals, and we will guide you for another good progression of bookings in Q1. We start to see the ramp-up of activity because the signature starts with a transition, and then we ramp up the development. There are more deals, more sizable deals than you think in the U.K. We are shortlisted, and we have even been down-selected in a few ones. Our U.K. colleagues are somewhat optimistic about a predictable ramp-up.
Thank you. Maybe if I could just squeeze in one follow-up question, maybe just more about Europe, continental Europe. Obviously, we have been seeing some acceleration in terms of the hyperscalers coming in. Yesterday, the announcement between Microsoft and Oracle on extending their interoperability agreement into Europe. Despite some of the macro sluggishness in Europe, do you still continue to see strong potential in terms of cloud acceleration and adoption? Obviously, France is okay, but outside of France as well.
Absolutely. You can imagine, notably, that the Bayer win puts us in a very credible position for infrastructure transition to the cloud because that is part of the Bayer deal. The Bayer deal is not a traditional infra-managed service contract. It is a transformation infrastructure deal. Our Germans, our British colleagues, and our French, I think in Europe, we are certainly seen by Azure, Microsoft, AWS, and Google as a key partner for the public cloud expansion that is really moving rapidly in continental Europe.
Okay. Thank you very much, and congratulations.
Thank you.
The next question comes from Neil Steer from Redburn. Sir, go ahead.
Thank you. I just have a couple of quick ones, if I may. Firstly, on the attrition, you mentioned the attrition rate had picked up. Could you give us some more color on that and why you're not concerned with regards to 2020? Secondly, whilst you've mentioned the core and the softness you saw, is that really a volume issue, or is that a pricing and a volume issue? And then a technical question with regards to consolidation of Altran. Obviously, you owned from the middle of January above 50%. From an accounting perspective, do you have a two-month period where you include that in your accounts as an associate? Then once you've got control, you fully consolidate? If you could just give us some clarity on the type of the accounting treatment of that for this year, that would be great.
Maybe to answer your question first on attrition, as we said, attrition remains higher than we would like to, but it's really manageable. That does not create any issues in our operation, and that doesn't prevent us from increasing our margin, as you can see. I would say that in the current environment, it's the right level of attrition that we can get. Thank you.
On the consolidation side on Altran, as Paul mentioned, we are waiting for the decision of the court on the 19th of March. Depending on the output of the decision, if it's positive, we will be in control then of Altran. That will be the starting point of our consolidation, so meaning that we are likely to consolidate starting Q2.
April 1st, yeah.
April 1st.
Okay. On your question on the core, what I said is we probably did not modernize our core. It's not price pressure, price competitiveness, but in the absence of an effort to refresh the core, we might not enjoy the best gross margin on that. It's not the impact of price competition.
Okay. Thank you.
Thank you, Neil.
The next question comes from Alex Touffe from Deutsche Bank. Sir, please go ahead.
Yeah. Hi. Morning, everyone. Thanks for taking the question. Just a couple on the sector trends that you've been seeing. Firstly, manufacturing being one of the strongest sectors this year, despite pretty weak manufacturing PMI globally, what do you attribute that strength to? Is it large deals, or is it broad-based strength? Do you assume some weakening in that sector in your FY 2020 guidance? Secondly, just another sector, financial services, obviously an industry-wide phenomenon there, the slowdown. I'd just be interested in getting your take on what you think is ultimately at the bottom of this. Thank you.
In manufacturing, we have a combination of both large deals and medium-sized deals. We see many manufacturing companies really focusing on digitizing their factories and their supply chain and various other things. The outlook for manufacturing, we feel, is positive and there are lots of opportunities to progress in that in 2020. Financial services, as I mentioned already, is somewhat more mixed. Insurance is doing very well, but there's definitely some pressure on spending in banks. I think the key for us in financial services is, particularly in banking, focusing on how we can help the banks to actually transform themselves as opposed to our traditional banking services, which have been largely focused on IT. We are working very hard there to ensure that we can add real business value to areas outside of the CIO, as well as continuing to deliver high-value IT services. We will see that progress during 2020. I'm confident.
Thank you, Rosemary. Next question.
The next question comes from Charles Brennan from Credit Suisse. Sir, please go ahead.
Perfect. Thank you so much for taking my questions. It's just a couple of questions around the order intake, actually. Is it right for us to assume that there's EUR 1 billion from the Bayer deal included in your Q4 bookings? If that's the case, then even if we look at it on a full-year basis, it looks like underlying order growth was only 3% or 4%. The first question is, is that the right interpretation? Secondly, if we think about the forward-looking position for 2020, you've talked about the pipeline being up double digit. How do we square that with your growth guidance for around 4% growth? Is there some contract duration or something else in that that explains the mismatch?
Yeah. I would say that that's not a correct interpretation on Bayer. Booking performance is strong even without Bayer in 2019. As you know, for these very large multi-year contracts, an internal rule leads us typically to recognize only a small proportion of the bookings. That is what we have done with Bayer. We start 2020 not with just strong results and a good pipeline, but also knowing that we have significant additional bookings to take from some of these large deals. We are looking very positively on that outlook. As Paul mentioned earlier on, particularly for the large deals, there is often a significant transition period. We do not necessarily see the revenue for those immediately. That is one of the reasons why you do not necessarily see revenue growth directly following some of the bookings.
What I would say is, first, you asked, Charles, the question of duration. We have not seen an evolution of the average duration. My interpretation of some disconnect between our bookings growth and the revenue outlook is some uncertainties have an impact on short-term discretionary spend. We see, actually, our mix between small orders and longer evolving in favor of large deals. It happened that uncertainty has an impact on discretionary spend. That was the case in the last months of last year. I think, notably, the reduction of trade tension. Of course, you may say there is a coronavirus now, but overall, we see less of that. We have today a good visibility thanks to these ramp-up. I repeat, even in Europe, where we enjoyed quite nice growth in H2, we see an increase in the second half thanks to the signature of larger deals out of the Bayer impact that will massively and significantly have an impact in the second half. Solid progression on all fronts. On the small orders, I would say quite sensitive to the overall economical mood.
Can I just ask a follow-up? You've clearly indicated that second half growth will accelerate versus the first half. If we think about Q1 and Q2 specifically, do you think they'll both be stronger than the Q4 that you just printed?
I think Aiman would say do expect H1 as a prolongation of the fourth quarter. As he said, close to 5% in the second half.
Perfect. Thank you.
Thank you.
The next question comes from Nicola Devid from Odo Chef. Sir, please go ahead.
Yes. Hi. Good morning, everybody. I have two questions, actually. First, can you give us some color regarding the erosion of margin in other Europe? Did you experience maybe some project delivery issues? Any detail will be helpful. The second one is regarding the full-year 2020 guidance, gross guidance. Why did you not provide a bracket like you used to, given that the macro environment is, I mean, it's blurring a little bit the visibility? Maybe this is a mass touch. I don't know. What would be the range of uncertainty of this guidance? Is it 50 basis points or 100 basis points up and down? Thank you.
On rest of Europe margin, these are not delivery leakage of a difficult project. There are a small collection of factors. I notably think of in the field of infrastructure management in one of rest of European countries, the end of some very profitable contract in the public sector. These kind of small elements added in a few countries. We have some very healthy countries and some where we have been down, and we expect to recover soon because this is not a trend. About the margin guidance, clearly, when we say around 4, it means 50 basis points total between the top and the bottom. We shoot for being around 4. We had lengthy discussion with Carole and Aiman about the range, and we thought last year we had a wide range that did not help us. We thought we should guide you more precisely.
Okay. That's clear.
The next question comes from John King from Global Research. Sir, please go ahead.
Yeah. Thanks, Charles, and my congratulations to you, Paul, as well. Just in regards to the core commentary in North America specifically, I was just hoping you could give a bit more color on exactly what that is. I mean, I think we're aware that you have a decent exposure to ERP in North America, but obviously, there's a product cycle there, LSAP, which I guess should be helping you. Is this about on-premise? I guess if that's the case, what can you do really to reinvigorate an on-premise business where the tide of the industry seems to be, I guess, running against that? That's not really just a Capgemini issue. Thank you.
John, the first point is S/4HANA is counted as part of the new, not traditional ERP, so that you know. We have lost a little bit of market share in ERP in the end of 2018, early 2019. Actually, we have completely changed the ERP team in the U.S., including for traditional ERP improvement and our pipeline of SAP traditional has significantly increased. That's why I say it was most probably a lack of focus and not an absence of modernization of traditional AM or traditional ERP or add-on custom development. The team has been changed. The head of what we call the application business line, ABL, has been changed by Aiman. He was there, very active. We have put an operator to support the maturity that comes from another part of the group, by the way, not a Frenchman, non-French. It is about focus and discipline. I think they are all confident. It starts to grow again. The pipeline is better. There is an increasing confidence that it was some distraction on our side. If you think of our North American situation, we were extremely bullish in 2014. There was a lack of attention. We came back double digit in 2017, 2018.
The question in the U.S. is more to organize maturity and stability. We do not think we suffer from any gap of competitiveness. It is solidifying the team, and I know that is what we have been, what we have loaded with some external recruits and some transfers from Europe. It is not about the leadership. John Mullen is the right leader for the U.S., and he is solid and extremely motivated and active. I have attended their kickoff meeting in Orlando a week ago. That was very im pressive.
Understood. Thank you.
The next question comes from Laurent Dov from Chevreux. Sir, please go ahead.
Yes. Thank you. Good mor ning, Aurore. In fact, three quick questions for me. The first is if you could give us a quick update on the French performance. In particular, you exceeded on the margin side, I think, what you hoped for a couple of years ago. What worked well in the region? The second question is on the U.K., especially the second half U.K. margin are still up while you had an unexpected slowdown. What draws the performance? Finally, sorry for coming back on the U.S., but I remember for a couple of years, we had a profitability that was negatively impacted by heavy investment in order to rebalance the business. Still today, the unit is not really performing. What happened? Is it also a problem of size of your operation there? Any more color would be helpful. Thank you. Laurent, thank you for your question.
On the French environment, as you can see, we've got year after year a strong improvement of our margins, and they're very close to group margins today, leading to the federal equation of the mix of our business together with a very strict monitoring of our costs. It is a combination of both, I would say, in France. On the U.K., it is definitely coming back to the level of margin we had in 2016 and 2017. There, the mix is very federal. It is really the accretion of margin that is linked to the mix and to the fact that the increasing portion of digital and cloud is bringing accretion in margin when it becomes at scale and when it is mature.
In the U.S., I mean, as you can see, the evolution is positive, especially in the second half of the year, meaning that we have made the right arbitration between the level of growth and evolution of margin, which is what we are committed to, to increase our level of revenues together with an increased profitability. It is exactly what we are aiming to.
Laurent, Paul speaking, we have not stopped investing, just to be clear. We told you in the past that the level of digital in you was behind, notably because of the thin size of Invent in the U.S. In spite of our acquisition, we are still lagging behind the group. We continue to invest.
Thank you.
Thank you, Laurent.
The next question comes from Richard Nguyen from SG Securities. Sir, please go ahead.
Thank you. Good morning. Thank you for taking my questions. I have two very quick questions, in fact, regarding the guidance for 2020 with the 4% targeted for the full group and 15% for the digital. Would that imply that we will still see a mid to high-significant digit revenue decline in the core? The second question would be that with the investment necessary for the core business to stem the losses, could you please give us some color on the margin profile for next year? Would that be massively back-end loaded? Thank you.
Richard, first, you're quite right. With mid-teen, it's clear matter simple. It's an erosion w e expect the erosion to be less than last year. We expect a lower contraction of the core, but still some. We do not comment to you on the margin profile of the year. Sorry, Richard. You see that in 2019, there was a contrasted evolution between H1 and H2, and we do not want to comment on that because there are different elements and some parts of our entities are investing more in H1 or in H2. Okay.
Thank you. Okay.
Thank you, Richard.
The next question comes from Michael Briest from UBS. Sir, please go ahead.
Yes. Thank you. Good morning, everyone. A couple for me as well. Just on Altran, can you sort of say in this very formal setting what you now think on synergies, cost synergies, given the likely shareholder structure? And in terms of accretion, I think you talked about 15%, assuming you own the 55% you own today. What would that come down to? Secondly, Paul, just on North America, do you think that that will be dilutive to growth this year, or should it be broadly in line with the 4% that you're looking for?
Thank you, Michael. First, we will provide you with a new full-year guidance late April. I have committed to the board that Aiman will come with the full value creation plan deriving from the collaboration. We would speak of aligned collaboration between Capgemini and Altran. For all of you, it will enable us to deliver a large proportion of the revenue synergies. On the cost synergies, I would just say we can have and we will be able to drive some cost effectiveness within Altran, but not some rationalization of cost as long as we have to manage two parallel entities.
We'll come back to you probably a little later on that and how the outlook and the impact on the EPS accretion a little later. I don't commit that for April, but probably a little later before the end of H1. On North America, Michael, I just forgot your question. I'm sorry. Dilutive to our growth. Dilutive to the growth. I would just say I would expect the U.S. to be dilutive to the group growth in H1 and align with the group growth or slightly dilute, but the gap will be possibly closed in the second half.
Okay. I mean, just finally, you could argue in October, obviously, people ended up being disappointed. You maybe alluded to some discretionary cutbacks, but was it just North America and financial services? There was an up and down phase in North America. Yeah.
Absolutely. No other disappointment. It was exactly North America and financial services that came a little shorter than what we had in mind when we spoke to you with the third quarter results.
Okay. Thanks.
We have no more questions.
The last one. No more questions. Okay . Thank you. Thank you, dear friends. I will still be with you until my last call, but I guess Aiman will be far more active because I try to represent him, but I will be at his side in April, and then it will be my last one. Thank you. Thank you.