Andy Green, chief executive of the IT group Logica, was on good form yesterday. He surprised the City with a better than expected forecast of 4 per cent sales growth this year and was rewarded with a 14 per cent jump in the share price. At 127.75p it is now nearly 50 per cent above this year's low in early March.

It has been a rocky couple of years for the company. Investors ousted Martin Read, Mr Green's predecessor, after delays on a contract forced the group to make a £15 million provision.

Mr Green was imported in January from BT, where he was a well-respected head of global services. Since then he has presided over a £110 million restructuring plan to revive the business, involving 1,300 job losses.

Moves have included hiring new experienced management talent and moving work offshore. In the process Logica has won some pretty significant long-term contracts, such as with Michelin in France and the Post Office in the UK.

Mr Green is clearly doing a great deal right. And he is cautiously upbeat about demand for its consultancy and systems integration services as the economy slows in the UK and the rest of Europe.

Gone are the days, he says, when companies saw IT as the first thing to chop when times get tough. Nowadays good IT investment is the key to cutting costs for savvy businesses.

Despite the downturn there is good potential still for Logica across a range of sectors, he says, including government, energy, utilities, telecoms and even transport.

Yet, while sales growth is back, with second-quarter pro forma growth of 8.5 per cent - compared with 3.6 per cent in first quarter - the prediction of only 4 per cent for the full year implies a sharp deceleration in the second half.

Mr Green acknowledges that 2009 will be “pretty soft”. His tactic is to hire consultants to get out there in the field with clients. He argues that hiring in-house consultants gives him greater flexibility.

But consultants do not come cheap and it looks a bold move as the downturn gathers pace. While Mr Green did a great job building up BT's global reach, he has less experience of retrenchment.

He would not be the first chief executive to convince himself that his customers would be irrational to cut back on his services in a downturn - only to find that his customers were indeed irrational.

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