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Alten

Earnings Release Sep 23, 2022

1103_iss_2022-09-23_ee1bc2e8-46a9-4909-912b-86e726a0a07a.pdf

Earnings Release

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PRESS RELEASE

Paris, September 23rd 2022 8:00am

BUSINESS IN FIRST HALF 2022

SHARP GROWTH OF BUSINESS AND RESULTS

  • SUSTAINED ORGANIC GROWTH: +19.8%
  • OPERATING MARGIN ON ACTIVITY: 11.4% OF REVENUE

4 ACQUISITIONS OUTSIDE FRANCE


million
June
2021
June
2022
YoY
change
Revenue 1,395.2 1,825.9 +30.9%
 France 505.4 598.4 +18.4%
 International 889.8 1,227.6 +38.0%
Operating Profit on Activity 137.1 208.6 +52.1%
As % of revenue 9.8% 11.4%
Operating Profit 124.2 186.9 +50.5%
As % of revenue 8.9% 10.2%
Net profit, Group share 89.3 139.0 +55.7%
As % of revenue 6.4% 7.6%
Free Cash flow 50.4 1.1
As % of revenue 3.6% 0.1%
Net cash position 162.9 62.4
Headcount 38,500 49,600

Ongoing audit

ACTIVITY AT END OF JUNE: +30.9%

ALTEN has experienced a robust organic growth for over a year.

Business reaches 30.9% at end of June 2022: +18.4% in France and +38.0% outside France. On a like‐for‐like basis and constant exchange rate, the activity grows by 19.8% (14.5% in France et 22.8% outside France).

All business sectors – including Civil aeronautics and Automotive – are growing and have exceeded their pre‐crisis level.

Most of geographical areas experience a strong organic growth above 15% – however excluding Scandinavia and Switzerland (7% of total revenue) with a growth below 5%.

OPERATING PROFIT ON ACTIVITY: 11.4% OF REVENUE

Operating Profit on Activity reaches €208.6 M increasing by 52.1% as compared to June 2021. Thanks to a significantly enhanced activity rate, a faster growth of international business, efficient SG&A management, the operating margin on activity reaches by 11.4% despite higher salaries (9.8% in June 2021).

OPERATING PROFIT: 10.2% OF REVENUE

Operating Profit reaches €186.9 M (i.e. 10.2% of revenue). It includes €15.4 M of share‐based payments and €6.2 M of non‐recurring costs (of which € 5.6 M earn‐out period).

NET PROFIT, GROUP SHARE: 7.6% OF REVENUE

Financial result reaches €0.4 M. After taking into account tax expenses of €48.3 M, the net income of the Group equals €139.0 M.

NET CASH POSITION: €62.4 M / GEARING: ‐ 4.1%

Cash flow (w/o IFRS16) reaches €213.8 M increasing by 51% as compared to June 2021. WCR increases by €154.6 M due to a sharp growth of activity and seasonal effects; DSO increases too. Capex stand for €11.0 M. As a consequence, free cash flow reaches €1.1 M.

After taking into account flows on acquisitions (‐ €116.0 M), other financial investments (+ €1.6 M), and dividends (‐ €44.1 M), net cash position equals + €62.4 M at end of June 2022.

ALTEN has self‐financed its internal & external growth and dividends; it has a healthy investment capacity to fiancé further acquisitions (gearing: ‐ 4.1%).

EXTERNAL GROWTH: 4 ACQUISITIONS OUTSIDE FRANCE

ALTEN has finalised 4 acquisitions en 2022:

  • In Spain: one company specialised in Cloud and digital transformation (annual revenue: €12 M, 180 consultants)
  • In India/US/Canada: one company specialised in product engineering (annual revenue: €12 M, 480 consultants)
  • In the UK: one company specialised in Cloud architecture and digital transformation (annual revenue: €110 M, 710 consultants)
  • In Australia: one company specialised in project management, consulting and training (annual revenue: €10 M, 90 consultants)

OUTLOOK FOR 2022:

The first half of 2022 follows the path of 2021.

Provided similar conditions, ALTEN will achieve a satisfactory organic growth and operating margin on activity in the second half of 2022. It should further develop its strategy of targeted external growth.

Next publication: October 26th after market closing: Q3 2022 Results

About ALTEN

For more information: www.alten.com/investisseurs / Journalists' details: [email protected]

As a European Leader in Engineering and Technology Consulting (ETC), ALTEN carries out design and research projects for Technical and IT divisions of major clients in industry, telecoms and services.

ALTEN's stock is listed in compartment A of the Euronext Paris market (ISIN FR000001946); it is part of the SBF 120, the IT CAC 50 index and MIDCAP100, and is eligible for the deferred Settlement Service (SRD).

APPENDIX TO PRESS RELEASE:

Definition of alternative performance measures and reconciliation with IFRS standards

The ALTEN Group uses alternative performance measures especially selected to follow up on its operational activities. The Group has chosen these measures as they supply additional information allowing the users of periodic financial information to have a comprehensive understanding of the Group's performance. Such alternative performance measures are complementary to IFRS standards.

Revenue growth on a like‐for‐like basis (i.e. organic growth)

Growth on a like‐for‐like basis (and constant exchange rate) is calculated excluding the effects of exchange rate variations and the variations of the consolidation scope on a chosen period.

Exchange rate impacts are measured by converting the revenue of the period with the average exchange rate from the previous period.

Scope variation impacts are measured excluding acquisitions, revenue of the period and for transfers, revenue of the previous period, in order to create a scope which is identical to the previous period. This alternative measure enables to identify the real performance of the Group in terms of activity on the chosen period.

This alternative measure enables to identify the real performance of the Group in terms of activity on the chosen period.

€M H1 2021
Revenue
H1 2022
Revenue
% Change
Revenue on a like‐for‐like
basis
1,395.2 1,671.3 19.8%
France 505.4 578.7 14.5%
International 889.8 1,092.5 22.8%
Scope variation 126.4 9.1%
France 19.7 3.9%
International 106.8 12.0%
Exchange rate impact 28.2 2.0%
France
International 28.2 3.2%
Group revenue 1,395.2 1,825.9 30.9%
France 505.4 598.4 18.4%
International 889.8 1,227.6 38.0%

Evolution of business in H1 2022

Operating Profit on Activity

Operating Profit on Activity is the operating income before taking into account the costs on share‐based payments, results from significant transfers of assets, goodwill impairment, as well as other significant and uncommon elements considered as miscellaneous fees and operational activities.

Since payments on share‐based compensation have noticeable heterogeneous annual changes, the tables included in our financial statements show the operational performance of the Group and make it possible to compare with previous or selected periods.

PRESS RELEASE

Net cash position

Net debt ‐ as defined and used within the Group, stands for cash flow and assimilated elements of cash flow less gross financial debt (bank loans and other assimilated financial debts). This measure is called 'net cash position' when the amount of cash flow or assimilated elements is higher than the financial debt; conversely, it is called 'net debt'.

Free cash flow

Free cash flow corresponds to net cash flow from operating activities minus net operating investments and net cash flow from financing activities related to payments of leasing debts.

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