Aubay — Earnings Release 2021

Mar 23, 2022

Boulogne-Billancourt, March 23, 2022

2021 annual results:

Strong growth, profitability and cash generation

Operating margin from ordinary activities: 10.6 % Net income attributable to owners of the parent: €34.4 million Net cash: €74.8 million

In € thousands	2021	2020	Change
Revenue	470,601	426,382	+10.4%
Operating profit from ordinary activities	49,927	41,215	+21.1%
As a % of revenue	10.6%	9.7%
Cost of performance shares	(1,489)	(1,112)
Other operating income and expenses	(1,120)	(1,463)
Operating profit	47,318	38,640	+22.5%
Financial income/(expense)	84	(419)
Tax (expense)/income	(12,921)	(12,036)
Net income from consolidated companies	34,481	26,185	+31.7%
As a % of revenue	7.3%	6.1%
Net income attributable to owners of the parent	34,409	26,132
Earnings per share	€2.60	€1.98
Headcount	7,306	6,562

Aubay's Board of Directors, which met on March 23, 2022 under Chairman Christian Aubert, approved the statutory and consolidated financial statements for 2021. The financial statements have been audited by the Statutory Auditors and the auditors' report will be issued once the procedures required to publish the company's Universal Registration Document have been completed.

After demonstrating remarkable resilience in 2020, the Group posted exceptional results in 2021 despite the uncertain health environment. It met or exceeded all its targets for growth, profitability, recruitment and cash generation.

Operating margin from ordinary activities above normative margin

Operating margin from ordinary activities was higher than estimated when the annual results were published in January, at 10.6 %, exceeding the Group's normative profitability target of between 9.5 % and 10.5 %.

The Group's operating margin from ordinary activities for the period came in at 9.6 % for activities in France and 11. 6% for activities overseas, compared with 9.3 % and 10.0 %, respectively, in 2020.

Operating profit: €47.3 million

Operating profit came to €47.3 million, a substantial increase of 22.5 %, after taking into account the cost of performance shares for €1.5 million and "Other operating income and expenses" representing a net expense of €1.1 million, primarily comprising restructuring expenses. The operating margin was 10.1 %, among the best in the sector.

Contacts

Sharp increase in net income attributable to owners of the parent (7.3 % of net margin)

Net income attributable to owners of the parent soared to €34.4 million, up 31.7 %, setting a new record after taking into account a tax expense of €12.9 million representing an effective tax rate of 27 %, versus 31 % in 2020.

Net cash (excluding rental liabilities) up significantly at €74.8 million

The Group's financial position was considerably strengthened in 2021 thanks to excellent generation of cash from operating activities of €45.8 million, versus €47.2 million in 2020, a superb performance given the strong increase in revenue. As a result, net cash increased from €44.7 million at December 31, 2020 to €74.8 million at December 31, 2021.

Proposed dividend of €1.10 per share

In light of this remarkable performance and the Group's excellent financial position, the Board of Directors has decided to propose a final dividend of €1.10 per share in respect of 2021 to the Annual General Meeting to be held on May 10, 2022, representing a payout ratio of 42 % of net income. Taking into account the interim dividend of €0.34 per share paid on November 10, 2021, the balance to be paid will amount to €0.76 per share.

Outlook for 2022

As of early 2022, the market in which Aubay operates is still very buoyant. Customers are continuing to ramp up their investments in digital transformation, with demand from key accounts even higher than the same time last year. The Group's key challenge will be to generate profitable and sustainable growth that outperforms its benchmark market, with Numeum forecasting growth of 4.7 % for the IT services industry in 2022.

All the Group's operating indicators are sound, building on the strong dynamic seen in 2021, and management is confident that the Group will achieve the following targets:

• Organic growth of between 7 % to 9 %, i.e., revenue of between €504 million and €513 million,
• Operating margin from ordinary activities of between 9.5 % and 10.5 %.

Aubay will publish its 2022 first-quarter revenue on April 21, 2022 after the close of trading.

Contacts

Glossary

Organic revenue growth: This refers to growth calculated for a constant scope of activity for a given period, excluding revenues from companies that were acquired or sold during the period. As Aubay conducts most of its business in the euro zone, any impact from changes in exchange rates is minimal.

	2021
Organic growth	+10.4%
Impact of changes in scope	-
Growth as reported	+10.4%

Operating profit from ordinary activities: this indicator corresponds to operating profit before the cost of free shares and other income and expenses that are unusual, abnormal or infrequent and that are booked separately in order to facilitate understanding of an entity's recurring operating performance.

Operating margin from ordinary activities: this indicator, which is expressed as a percentage, is the ratio of operating profit from ordinary activities to revenue.

Net debt or net cash (excluding rental liabilities): this indicator represents the difference between an entity's cash and debt. If the result is negative, it is referred to as net debt. If it is positive, it is referred to as net cash.

About Aubay

Aubay is a digital services company working alongside some of the biggest names in the Banking, Finance, Insurance, Manufacturing, Energy, Transport and Telecoms sectors. With 7,306 employees in seven countries (France, Belgium, Luxembourg, Italy, Spain, Portugal and the United Kingdom), Aubay generated revenue of €470.6 million in 2021.

Contacts

Euronext, Compartment: B ISIN FR0000063737-AUB Reuters AUBT.PA Bloomberg AUB:FP

APPENDICES

Statement of financial position as of December 31, 2021

ASSETS (in € thousands)	Dec. 31, 2021	Dec. 31, 2020
Goodwill	131,305	131,305
Intangible assets	917	771
Property, plant & equipment	4,156	5,166
Right of use relating to leases	14,152	18,611
Equity-accounted investees	-
Other financial assets	2,102	2,263
Deferred tax assets	2,653	2,472
Other non-current assets	354	118
NON-CURRENT ASSETS	155,639	160,706
Inventories and work in progress	491	516
Assets on contracts	32,127	29,148
Trade receivables	111,359	105,432
Other receivables and accruals	37,082	33,496
Marketable securities	1,026	579
Cash at bank and in hand	78,461	51,883
CURRENT ASSETS	260,546	221,054
TOTAL ASSETS	416,185	381,760
EQUITY AND LIABILITIES (in € thousands)	Dec. 31, 2021	Dec. 31, 2020
Capital	6,611	6,604
Additional paid-in capital and consolidated reserves	188,740	170,016
Net income attributable to owners of the parent	34,409	26,132
Shareholders' equity attributable to the Group	229,760	202,752
Minority interests	191	144
SHAREHOLDERS' EQUITY	229,951	202,896
Borrowings and financial liabilities: non-current portion	2,155	3,913
Rental liabilities due in more than 1 year	10,198	13,756
Deferred tax liabilities	1	1
Provisions for contingencies and expenses	6,924	6,751
Other non-current liabilities	74	273
NON-CURRENT LIABILITIES	19,352	24,694
Borrowings and financial liabilities: current portion	2,500	3,907
Rental liabilities due within 1 year	4,366	5,240
Trade and other payables	35,981	30,572
Contract liabilities	19,913	18,319
Other current liabilities	104,122	96,132
CURRENT LIABILITIES	166,882	154,170
TOTAL EQUITY AND LIABILITIES	416,185	381,760

Income statement for 2021

In € thousands	2021	%	2020	%
Revenue	470,601	100%	426,382	100%
Other operating income	409		421
Purchases used in production and external charges	(99,319)		(86,216)
Staff costs	(310,482)		(287,855)
Taxes other than on income	(3,963)		(3,702)
Amortization, depreciation and provisions	(7,558)		(7,628)
Change in inventories of work in progress and finished goods
Other operating income and expenses	239		(187)
Operating profit from ordinary activities	49,927	10.6%	41,215	9.7%
Expenses linked to restricted share units and similar awards	(1,489)		(1,112)
Current operating profit	48,438	10.3%	40,103	9.4%
Other operating income and expenses	(1,120)		(1,463)
Operating profit	47,318	10.1%	38,640	9.1%
Income from cash and cash equivalents
Net borrowing costs	(494)		(588)
Other financial income and expenses	578		169
Financial income/(expense)	84		(419)
Income tax expense	(12,921)	27%	(12,036)	31%
Income from equity-accounted investees Net income before results of discontinued operations or assets held for sale	34,481		26,185
Net income after tax of discontinued operations or assets held for sale
Net income	34,481	7.3%	26,185	6.1%
Attributable to owners of the parent	34,409		26,132
Minority interests	72		53
Basic weighted average number of shares	13,209,435		13,192,494
Earnings per share	2.60		1.98
Diluted weighted average number of shares	13,283,935		13,244,994
Diluted earnings per share*	2.59		1.97

Contacts

(in € thousands)	2021	2020
Consolidated net income (including non-controlling interests)	34,481	26,185
Income from equity-accounted investees
Net depreciation, amortization and provisions and right of use relating to leases	7,161	7,298
Non-cash expenses and income relating to share-based payments	1,489	1,112
Other non-cash items		212
Dividend income
Gains and losses on disposals of fixed assets	1	45
Cash flow after net interest expense and tax	43,132	34,852
Net borrowing costs	494	588
Tax expense (including deferred taxes)	12,921	12,036
Cash flow before net interest expense and tax (A)	56,547	47,476
Income tax payments (B)	(11,485)	(9,651)
Change in trade and other receivables (C)	(13,215)	8,323
Change in trade and other payables (C)	13,959	1,121
Change in WCR linked to operations (including debt related to employee benefits)	744	9,444
Net cash provided by (used in) operating activities (D) = (A+B+C)	45,806	47,269
Outflows for the acquisition of tangible and intangible fixed assets	(1,034)	(1,023)
Inflows from the disposal of tangible and intangible fixed assets
Outflows for the acquisition of financial assets		(48)
Inflows from the disposal of financial assets
Change in loans and advances granted	99	356
Disbursements (cash) related to business combinations, net of cash and cash equivalents
Dividends received
Other operating cash flows
Net cash provided by (used in) investing activities (E)	(935)	(715)
Proceeds from capital increases
Amounts received upon the exercise of stock options
Purchases of treasury shares for cancellation
Purchases of and proceeds from the sale of treasury shares
Dividends paid in the period:
- Net dividends paid to parent company shareholders	(8,851)	(7,916)
- Dividends paid to the non-controlling shareholders of consolidated companies	(25)
Inflows from new borrowings		1,734
Repayment of loan debt	(3,374)	(6,631)
Repayment of rental liabilities	(5,323)	(5,048)
Net interest payments	(494)	(588)
Purchase of non-controlling minority interests
Other financial cash flows
Net cash provided by (used in) financial activities (F)	(18,067)	(18,449)
Effects of changes in foreign exchange rates (G)	47	(31)
Change in net cash (D+E+F+G)	26,851	28,074
Cash and cash equivalents at the beginning of the period	52,205	24,131
Cash and cash equivalents at end of period	79,056	52,205