Generix Group S.A. — Earnings Release 2015

Nov 25, 2015

1st Half 2015/2016 Results EBITDA of 6% of revenue

Paris, November 23, 2015 - Generix Group, Industrial, Logistical and Retail Ecosystems provider with leading Collaborative Software Solutions, today issued its interim financial statements for the six-month period ended September 30, 2015.

Growth propelled by the dynamic SaaS model

The strong growth in sales with SaaS, already observed for over two years is confirmed over the first half of fiscal 2015/2016 with the number of new SaaS contracts signed up 3.6 times compared to the same quarter of the previous period.

As the new SaaS contracts signed run for an average of 4.7 years, the signatures recorded during the first half of the year (worth €15.1 million) will, once the various deployments are completed, allow us to generate additional annual sales in excess of €3.2 million.

The dynamic signing rate observed during the previous period means 15% growth in the revenue generated by the SaaS business which also drives the Consulting and Services business thanks to the projects that come with the new signings.

		Six months ended, September 30.	Variation
IFRS consolidated accounts, in millions of Euros	2015	2014	m €	%
Revenues	27,3	24,9	2,3	9%
Which licenses	1,7	1,3	0,4	28%
Which maintenance	8,8	8,6	0,2	2%
Which SaaS	8,0	6,9	1,1	15%
Which Consulting Services	8,8	8,1	0,8	9%
Operational expenses / other income from operations	- 25,7	- 24,0	- 1,7	7%
Profit from current operations from continuing operations	1,5	0,9	0,6	72%
Other operational income and expenses	- 0,3	- 0,6	0,3	-52%
Profit from operations from continuing operations	1,2	0,3	1,0	377%
Financial expenses	- 0,1	- 0,1	0,0	-17%
Profit before income taxes	1,1	0,1	1,0	741%
Income taxes benefit	- 0,4	- 0,1	- 0,3	203%
Net result from continuing operations	0,7	- 0,0	0,7	N/A
Net result after tax from discontinued operations	-	- 0,9	0,9	100%
Net result	0,7	- 0,9	1,6	N/A

		Six months ended, September 30.				Variation
EBITDA in millions of Euros		2015 2014				m €	%
Revenues		27,3		24,9		2,3	9%
Other income from operations		0,6		0,5		0,1	17%
Cost of goods sold	-	0,5	-	0,4	-	0,0	9%
Other purchases and external expenses	-	8,8	-	7,7	-	1,1	14%
Taxes and similar payments	-	0,6	-	0,6	-	0,0	1%
Personnel costs	-	15,3	-	14,2	-	1,1	8%
Other expenses on operations	-	0,2	-	0,4		0,1	-38%
Reversals of used provisions during the period		-	-	0,0		0,0	N/A
Capitalized production	-	0,5	-	0,4	-	0,1	30%
Sales commissions spread	-	0,6			-	0,6	N/A
EBITDA (1)		1,5		1,7	-	0,2	-13%

(1) EBITDA = current operating income + net provisions on current assets + net provisions for risks and charges + depreciation on fixed assets - capitalized production costs – sales commissions spread

During the half year, the Group recorded EBITDA of 6% of revenue (or €1.5 million). This slight fall back in EBITDA as a share of revenue (down one point compared with the first half of 2014/2015) is due primarily to the cumulative effects of:

• The full half year impact of the reinforced operational marketing and sales force resources added in 2014/2015 given rising interest in the offers the Group has rolled out,

• Sales force variable overheads linked primarily to the signature of two contracts worth exceptional amounts during the first quarter of the current half year.

Thanks to falling write-offs and provisions compared with the first quarter of the previous period, so that current operational income came to €1.5 million, or 6% of revenues, an improvement of two points over the first half of the previous fiscal year.

After allowing for other operational charges over the past half year (€-0.3 million), operational income came to €1.2 million, up €1 million over the first half of the previous fiscal year. The other operational charges correspond:

• During the past half year (€-0.3 million): To the share of the purchase price of our new GMI Connectivity subsidiary to be booked to the profit and loss account,

• During the first half of the previous fiscal year (€-0.6 million): To the charge relating to employee profit sharing generated for the most part by the taxable capital gains from selling off the GCE ERP business.

Net income improved by €0.7 million compared with the same period of the previous fiscal year.

Improved internal financing capacity

Our cash position on 30 September 2015 was down €10.9 million compared with 30 September 2014. This variation can mostly be explained by the buy-back finalized in January 2015, then by taxes and profit sharing linked to the sale of the GCE ERP business.

Net treasury, in millions of Euros			Six months ended, September 30.	Variation
		2015	2014	m €		%
Cash and Cash equivalents, end of period	-	1,5	9,4	-	10,9	N/A
Short-term and long-term portions of financial obligations	-	5,8	- 4,2	-	1,6	38%
Net treasury / (net debt)	-	7,3	5,2	-	12,5	N/A

		Six months ended, September 30.				Variation
Consolidated statements of cash flows, in millions of Euros	2015			2014		m €	%
Net income adjusted by non-cash items		1,8	-	0,4		2,2	N/A
Change in working capital	-	7,9	-	1,8	-	6,0	328%
Net cash by operating activities	-	6,1	-	2,3	-	3,8	167%
Net cash used in investing activities	-	2,1		8,9	-	11,0	N/A
Free cash flow	-	8,2		6,6	-	14,8	N/A
Net cash by financing activities	-	1,4	-	2,0		0,6	-32%
Net variation in cash and cash equivalent	-	9,5		4,6	-	14,1	N/A
Cash and cash equivalent, end of period from continuing operations	-	1,5		9,4	-	10,9	N/A
Net variation in cash from discontinued operations		-	-	3,2		3,2	100%
Cash and cash equivalent, end of period from discontinued operations		-		-		-	N/A

The cash flow statement expresses the flows between March 31 and September 30, 2015 in comparison to the same period last fiscal year. Between these two dates, the working capital requirements increased due to paying for annual maintenance contracts invoiced at the start of the calendar year and accounted for in revenues over the entire year.

Our cash flow for the past half year was marked by:

• An internal financing capacity of €1.8 million, up by €2.2 million over the same half of the previous fiscal year. The first half of 2014/2015 was marked by the transfer of a provision relating to a commercial dispute, to current debt, worth €1.6 million.

• A €7.9 million variation in our working capital requirements, up €6.1 million over that observed for the first half of 2014/2015. This rise in our working capital requirements shows:

• Extra time needed to collect client balances as of 30 September 2015,

• Current debt of €1.6 M as of 30 September 2014, linked to a commercial dispute (see above),

• Tax and profit sharing debts as of 30 September 2014, linked to the sale of the GCE ERP business.

• Net cash flow linked to investment activities (€-2.1 million) especially reflecting the purchase of GMI Connectivity. As a reminder, the €8.9 million credit during the first half of fiscal 2014/2015 mainly expressed the sale of the GCE business.

Prospects

The SaaS signatures seen since the start of the fiscal year, together with first half profitability that is in line with the Group's forecasts, mean that we can start the second half of fiscal 2015/2016 confidently.

Supplemental and non-IFRS Financial Information

Supplemental non-IFRS information (above-mentioned as Ebitda, net treasury or net debt) presented in this press release are subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for IFRS measurements. Also, the Company's supplemental non-IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies.

The Half-Year Financial Report at September 30, 2015 is available for download at the address: http://www.generixgroup.com/fr/liste/rapports-financiers/

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Next press release: January 25, 2016 after closing of the stock exchange Revenues for the third quarter of financial year 2015/2016

Contacts

Ludovic Luzza Chief Financial Officer Tel.: +33 (0)1 77 45 42 80 lluzza@generixgroup.com www.generixgroup.com

Stéphanie Stahr CM-CIC Emetteur Tel.: +33 (0)1 45 96 77 83 stahrst@cmcics.com www.cmcics.com

About Generix Group

Software editor of collaborative applications, Generix Group helps its customers to face with the digital enterprise challenges: facilitating buying journeys, building a digital supply chain, and dematerializing all data flows. By building differentiating services, Generix Group optimizes the overall performance of the company within its ecosystem, enabling it to meet customers' new expectations.

Over 5,000 international players have contributed to establishing Generix Group as a European leader, with close to €54 million in turnover

For more information, visit www.generixgroup.com