Accenture Ltd., the world?s second-largest consultant, said first-quarter profit rose 13 percent because of higher investment income.

Net income increased to $196.3 million, or 32 cents a share, in the quarter ended November 30 from $174.3 million, or 33 cents, a year earlier, Bermuda-based Accenture said in a statement. Sales, before reimbursements to clients for contract costs, rose 14 percent to $3.73 billion.

Investment and interest income surged, helping the company beat a recently lowered forecast. Accenture said in October growth slowed in its computer management unit. Operating costs rose 18 percent, faster than sales.

The company, whose clients include AT&T Corp. and US Homeland Security Department, raised its 2005 forecast, mostly because of lower reorganisation costs.

?I don?t think anyone walked away saying this was an amazing quarter,? said RBC Capital Markets analyst Cynthia Houlton in New York, who rates the shares ?outperform?.

Accenture was expected to earn 31 cents, the average of 21 analysts surveyed by Thomson Financial. Sales including client reimbursements of $4.07 billion topped analysts? estimates of $3.63 billion.

Labor costs rose because of higher pay and bonuses and what the company called staffing inefficiencies.

Operating income declined 9.7 percent to $458.2 million. Investment income increased to $14.5 million from $498,000 a year earlier, and the company reported interest income of $20.1 million, almost double the total a year earlier.

Accenture will seek to boost profit this year by cutting costs and improving service, chief financial officer Michael McGrath said on a conference call with analysts. ?Our objective for the year is to have operating margins in excess of 13 percent,? he said in an interview.

The company forecast fiscal second-quarter profit of 33 cents to 35 cents a share, including a three-cent gain from declining reorganisation costs. It forecast sales of $3.6 billion to $3.75 billion. For the year, Accenture forecast net income of $1.41 to $1.46 a share on sales growth of 13 percent to 16 percent. (Bloomberg News)