Tinexta — Earnings Release 2019

Aug 5, 2019

Informazione Regolamentata n. 20053-35-2019		Data/Ora Ricezione 05 Agosto 2019 21:11:09	MTA - Star
Societa'	:	TINEXTA S.p.A.
Identificativo Informazione Regolamentata	:	121632
Nome utilizzatore	:	TINEXTANSS01 - KAY
Tipologia	:	1.2
Data/Ora Ricezione	:	05 Agosto 2019 21:11:09
Data/Ora Inizio Diffusione presunta	:	05 Agosto 2019 21:11:10
Oggetto	:		Tinexta: growth continues in First Half 2019
Testo del comunicato

Vedi allegato.

PRESS RELEASE

Tinexta: growth continues in First Half 2019¹

➢ Approved Results as of 30 June 2019²

• Revenues: €126.6 million, + 10.6%
• EBITDA: €32.4 million, +12.1%
• Adjusted EBITDA³ : €35.7 million, + 22.7%
• Net Profit: €14.0 million, +0.3%
• Free Cash Flow: €23.8 million
• Net Financial Debt: €140.2 million (€124.9 million as of 31/12/18), of which 14.7 million due to the adoption of accounting IFRS Standard 16

➢ 2019 Targets Confirmed

Rome, 5 August 2019. The Board of Directors of Tinexta S.p.A., active in the services of Digital Trust, Credit Information & Management and Innovation & Marketing Services, approved the Half-Year Financial Report as of 30 June 2019, which shows a strong progression of Group's consolidated economic results, supported by a positive performance from all 3 business units.

The Group closed First Half 2019 with Revenues of €126.6 million, EBITDA of €32.4 million, equal to 25.6% of Revenues, and Net income was €14.0 million, or 11.1% of Revenues. Adjusted EBITDA, calculated gross of the extraordinarily large provision of €3.3 million, amounted to €35.7 million, or 28.2% of revenues.

Chairman Enrico Salza commented: "The excellent operating results for the half year, in a difficult economic environment, confirm the strategic choices of the Group, which continues to consolidate its leadership in each sector of activity."

Chief Executive Pier Andrea Chevallard expressed satisfaction with the results: "In the first half of the year the Group continued to grow, reporting an increase in sales and profitability in line with the long-term goals. In addition, it has undertaken activities aimed at implementing a new Group operating model that will enable the realization of synergies both in terms of the generation of new cross-selling revenues and cost efficiency."

¹ From 1 January 2019 the Group has adopted accounting standard IFRS 16 "Leasing" which has led to changes in accounting policies and in some cases adjustments to the amounts recognized in the financial statements. The comparative figures for 2018 have not been restated while the figures for the period in question are affected by the application of the aforementioned Standard. In order to ensure effective comparability with the economic, equity and financial results of 2018, the effects on the comparative analyses deriving from the application of IFRS 16 adopted from 1 January 2019 are illustrated.

² The comparative data for First Half 2018 have been redetermined in relation to the completion in the last quarter of 2018 of the activities identifying the fair value of the assets and liabilities of Warrant Hub S.p.A. and its consolidated subsidiaries 1 December 2017, as well as the completion in the last quarter of 2018 of the assets identifying of the fair value assets and liabilities of AC Camerfirma S.A., consolidated in full from 1 May 2018.

³ Calculated as EBITDA before the provision for the Virtual Stock Option Plan for senior executives with strategic responsibilities of Tinexta S.p.A. and approved by the Board of Directors on 14 November 2016. It is calculated as EBITDA before the provision for the Virtual Stock Option Plan for senior executives with strategic responsibilities of Tinexta S.p.A. and approved by the Board of Directors on 14 November 2016. No adjustment was made due to the effect of IFRS 16, whose impact is € 1.7 million.

GROUP CONSOLIDATED ECONOMIC RESULTS TO 30 JUNE 2019

Below is the table of the Income Statement with the details of the items of First Half 2019 compared with the same period of the previous year:

Consolidate Income Statement (€000s)	1st Half 2019	%	1st Half 2018	%	Change	of which change IFRS 16	% Change	of which %∆ IFRS 16
Revenues	126,592	100.0%	114,510	100.0%	12,082	0	10.6%	0.0%
Total Operating Costs	90,929	71.8%	85,455	74.6%	5,475	-1,685	6.4%	-2.0%
Costs of raw materials	3,415	2.7%	2,875	2.5%	540	0	18.8%	0.0%
Service costs	40,731	32.2%	38,657	33.8%	2,075	-1,546	5.4%	-4.0%
Personnel costs*	41,299	32.6%	38,265	33.4%	3,034	-139	7.9%	-0.4%
Contract costs	4,191	3.3%	4,644	4.1%	-454	0	-9.8%	0.0%
Other operating costs	1,293	1.0%	1,014	0.9%	279	0	27.6%	0.0%
Adjusted EBITDA	35,663	28.2%	29,055	25.4%	6,608	1,685	22.7%	5.8%
Virtual Stock Option provisions *	3,293	2.6%	182	0.2%	3,112	0	1,711.3%	0.0%
EBITDA	32,369	25.6%	28,873	25.2%	3,496	1,685	12.1%	5.8%
Amortisation depreciation, provisions and impairment	11,019	8.7%	7,940	6.9%	3,079	1,634	38.8%	20.6%
EBIT	21,350	16.9%	20,933	18.3%	417	52	2.0%	0.2%
Financial income	226	0.2%	82	0.1%	143	0	174.6%	0.0%
Financial charges	1,494	1.2%	1,077	0.9%	417	172	38.8%	16.0%
Profit of equity accounted investments	15	0.0%	30	0.0%	-16	0	-51.5%	0.0%
Profit Before Tax	20,096	15.9%	19,968	17.4%	127	-120	0.6%	-0.6%
Income taxes	6,079	4.8%	5,997	5.2%	83	-34	1.4%	-0.6%
Net Profit	14,016	11.1%	13,972	12.2%	45	-87	0.3%	-0.6%

*Personnel Costs are presented net of the Virtual Stock Option Provision, which is disclosed separately below, in order to better understand the construction of Adjusted EBITDA.

Revenues amounted to €126.6 million in First Half 2019, an increase of 10.6% compared to First Half 2018. The increase in revenues attributable to organic growth was 6.3%, while 4.3% was due to changes in perimeter.

EBITDA totalled €32.4 million, an increase of 12.1%, while the EBITDA margin equalled 25.6% (25.2% in First Half 2018). The application of IFRS 16 had a positive impact on EBITDA, in terms of lower costs, amounting to €1.7 million. Organic EBITDA growth was 2.4%, while the change in the consolidation perimeter resulted in a 3.8% increase.

In the first half of the year, the appreciation of Tinexta's stock resulted in a provision in relation to the Virtual Stock Option Plan, aimed at executives with strategic responsibility, amounting to €3.3 million. Excluding this provision, the Adjusted EBITDA margin increased to 28.2% in First Half 2019 from 25.4% in First Half 2018. The improvement is due to the positive mix of sales, careful cost control and the effect of the adoption of the IFRS16 Standard; excluding the latter, the Adjusted EBITDA margin for First Half 2019 would have been 26.8%.

Amortization, depreciation, provisions and impairment totalled €11.0 million (€7.9 million in First Half 2018), including €3.0 million of amortization of other intangible assets that emerged when allocating the

excess cost paid for business combinations, mainly of Innolva, Visura, Co.Mark and Warrant Hub. The increase in the item is affected by the adoption of the IFRS Principle 16, which involved the recognition of depreciation on the rights of use collected for €1.6 million.

The balance of Financial Income and Charges in First Half 2019 is negative €1.3 million (€-1.0 million in First Half 2018).

The tax estimate, calculated on the basis of the rates foreseen for the year by the current legislation, is €6.1 million. The tax rate is 30.3%, in line with the same period of the previous year (30.0%).

Non-recurring components

The table below shows the economic results net of non-recurring components.

Summary Income Statement net of non-recurring items (€'000s))	1st Half 2019	%	1st Half 2018	%	Change	of which change for IFRS 16	% change	of which %∆ IFRS 16
Revenues	126,592	100.0%	114,330	100.0%	12,261	-	10.7%	0.0%
EBITDA Adjusted	36,657	29.0%	29,411	25.7%	7,246	1,685	24.6%	5.7%
EBITDA	33,363	26.4%	29,229	25.6%	4,134	1,685	14.1%	5.8%
EBIT	22,344	17.7%	21,289	18.6%	1,055	52	5.0%	0.2%
Net Profit	14,380	11.4%	14,224	12.4%	156	-87	1.1%	-0.6%

During First Half 2019, non-recurring Operating Costs of €1.0 million were reported, for charges related to the implementation of the Group's new operating model and other restructuring and reorganization charges of the Group. Non-recurring financial income equalled €0.15 million, relating to a capital gain made on the sale of a minority stake. Non-recurring tax income amounted to €0.5 million for the tax effect on nonrecurring components of the pre-tax result and for the benefit of the so-called "Patent Box" for the 2019 year as reported by InfoCert S.p.A.

During First Half 2018, non-recurring revenues of €0.2 million were reported, non-recurring operating costs of €5 million euros and non-recurring tax income of €0.1 million.

Adjusted Net Profit for First Half 2019 was €19.0 million, + 15.8% with respect to 2018. Adjusted Net Profit is calculated as "Net Profit" before non-recurring components, provision for the Virtual Stock Option Plan, depreciation of other intangible assets emerged when the Purchase Price paid for a company's aggregation was allocated, net of its tax effect. This indicator reflects the economic performance of the Group, net of non-recurring factors that are not closely related to the operations and management of the "core business", thus allowing a more homogeneous comparison of the Group's performance in the periods represented.

Summary Consolidated Income Statement ((€'000s)	1st Half 2019	1st Half 2018	Change	of which % change IFRS 16	% Change	of which % change IFRS 16
Net Profit	14,016	13,972	45	-87	0.3%	-0.6%
Non-recurring revenues	0	-179	179
Non-recurring services costs	755	401	354
Non-recurring personnel costs	239	134	105
Virtual stock options provisions	3,293	182	3,112
Depreciation of other intangible assets that emerged during allocation	2,957	2,859	98
Non recurring financial income	-148	0	-148
Tax effect	-2,114	-962	-1,152
Adjusted Net Profit	19,000	16,407	2,594	-87	15.8%	-0.5%

ECONOMIC RESULTS AS OF 30 JUNE 2019 BY BUSINESS SEGMENT

The table below shows the economic results by business segment, net of non-recurring components and then a comment on each business unit:

Abbreviated Income Statement		EBITDA %		EBITDA %		of which		% Change
by business segment net of nonrecurring items (€'000s)	1st Half 2019	1st Half 2019	1st Half 2018	1st Half 2018	Change	change IFRS 16	Total	IFRS 16	Organic	Perimeter
Revenues
Digital Trust	51,745		45,503		6,242	0	13.7%	0.0%	10.0%	3.7%
Credit Information & Management	37,912		37,170		741	0	2.0%	0.0%	-6.7%	8.7%
Innovation & Marketing Services	36,935		31,656		5,278	0	16.7%	0.0%	16.7%	0.0%
Other segments (Parent Company)	0		0		0	0	0.0%	0.0%	0.0%	0.0%
Revenues total	126,592		114,330		12,261	0	10.7%	0.0%	6.4%	4.3%
EBITDA
Digital Trust	13,358	25.8%	11,505	25.3%	1,853	778	16.1%	6.8%	6.9%	2.5%
Credit Information & Management	9,529	25.1%	7,814	21.0%	1,716	394	22.0%	5.2%	6.9%	9.8%
Innovation & Marketing Services	17,378	47.1%	13,012	41.1%	4,366	441	33.6%	3.4%	30.2%	0.0%
Other Segments (Parent Company)	-6,902	n,a,	-3,102	n,a,	-3,800	72	-122.5%	2.3%	-124.8%	0.0%
EBITDA Total	33,363	26.4%	29,229	25.6%	4,134	1,685	14.1%	5.8%	3.8%	4.6%

Digital Trust

Revenues in the Digital Trust segment amounted to €51.7 million. The increase compared to First Half 2018 was 13.7%, consisting of organic growth of 10.0% and a growth from perimeter change of 3.7%. The change in perimeter is due to the full consolidation of Camerfirma and Camerfirma Peru as of 1 May 2018.

EBITDA for the segment was €13.4 million euros. The increase compared to EBITDA in First Half 2018 was 16.1%. Organic growth amounts to 6.9%, the contribution of Camerfirma and Camerfirma Peru, for the afore mentioned change of perimeter, is equal to 2.5%. The adoption of IFRS Standard 16 from 1 January 2019 resulted in a positive change compared to First Half 2018 of 6.8%. The EBITDA margin was 25.8% compared to 25.3% of the previous year); excluding the effects of the adoption of IFRS 16, the EBITDA margin fell modestly to 24.3% as a result of the higher support and assistance costs incurred in connection with the start of electronic invoicing from 1 January 2019.

Credit Information & Management

In the Credit Information & Management segment, revenues amounted to €37.9 million. Compared to the first half of the previous year, there was an increase of 2.0% consisting of an organic reduction of 6.7% and a change of perimeter of 8.7% as a result of the consolidation of Comas and Webber from 1 July 2018, of Promozioni Servizi from 1 November 2018 and the deconsolidation from June 2018 of Creditreform Assicom Ticino (now Creditreform GPA Ticino).

EBITDA increased 22.0% compared to First Half 2018 to €9.5 million; the change in perimeter was 9.8% and organic growth of 6.9%. The adoption of IFRS Standard 16 from 1 January 2019 resulted in a positive change compared to First Half 2018 of 5.2%. The EBITDA margin was 25.1%, increasing from the same period of the previous year (21.0%), also net of the effects of the adoption of IFRS 16 (24.1%).

Despite an extremely competitive market, which resulted in an organic reduction of revenues in First Half 2019, organic EBITDA growth has been positive thanks to a careful cost control policy.

Innovation & Marketing Services

Revenues in the Innovation & Marketing Services segment amounted to €36.9 million. The increase compared to First Half 2018 was 16.7%, in line with forecasts.

EBITDA for the segment was €17.4 million euros. The increase compared to EBITDA in the previous year was 33.6%. Organic growth amounts to 30.2%. The adoption of IFRS Standard 16 from 1 January 2019 resulted in a change of 3.4% compared to First Half 2018. The EBITDA margin was 47.1%, increasing from First Half 2018 (41.1%), also net of the effects of the adoption of IFRS 16 (45.9%).

Group Net Financial Indebtedness

Net Financial Indebtedness amounted to €140.2 million, an increase of €15.3 million compared to 31 December 2018.

The main factors affecting the change in Net Financial Indebtedness are summarized below.

	(€'000)
Net Financial Indebtedness at 31/12/2018	124,946
Free Cash Flow	-23,751
Dividends approved	16,396
FTA IFRS 16	15,043
Adjustments to put options	5,274
Net financial (Income) charges	1,416
New leasing contracts	1,019
Sales of minority participations	-150
Other	52
Net Financial Indebtedness al 30/06/2019	140,245

• The Free Cash Flow generated in the period amounted to €23.8 million: €29.5 million of Net cash generated by operations net of €5.7 million absorbed by investments in Property, plant and equipment and in Intangible assets.

• The adoption of the IFRS Standard 16 as of 1 January 2019 resulted in the detection of financing liabilities for leasing amounting to €15.0 million. In First Half 2019, the signing of new leasing contracts resulted in €1.0 million of additional financial liabilities. Taking into account the payments and interest accrued during the first half of the year, the impact of IFRS 16 on Net Financial Indebtedness as of 30 June was €14.7 million.

• Dividends deliberated amount to €16.4 million euros, of which 10.7 million regarding Tinexta S.p.A and €5.7 million from the Group's companies to minorities.

• The Adjustment of Put options, as a result of the revision of the estimate of expected payments based on the forward-looking results forecast by the interested companies and as a result of the revaluation due to the passage of time, was €5.3 million.

The composition of the Net Financial Indebtedness as of 30 June 2019 reflects the exercise of Warrant HUB's PUT Options (20.25% of its capital), which resulted in an increase in bank debt and a reduction in debt to selling shareholders.

In particular, the financial indebtedness as of 30 June 2019 includes:

• €35.0 million of liabilities related to the purchase of minority shares for Put options (€59.1 million as of December 31, 2018),
• Liabilities for contingent consideration linked to the acquisitions of €6.4 million (1.2 million as of December 31, 2018) and
• Liabilities for deferred payments granted by sellers of €8.3 million (€10.7 million as of 31 December 2018).

On 28 June 2019, the loan of €25 million extended by the controlling shareholder Tecno Holding was also repaid through the use of bank financing lines.

* * * * *

As communicated on 15 May 2019, at the beginning of May 2019 the subsidiary Visura S.p.A. suffered a cyber-attack that required precautionary measures on about 13% of the Certified Electronic Mail addresses marketed by the same and managed by InfoCert. These measures were aimed at restoring operations and guaranteeing the security of the services rendered. As already communicated, the appropriate in-depth analyses have been carried out and the necessary reports have been made to the competent authorities.

As of today, preliminary investigations have been undertaken by the Data Protection Authority with regard to Visura S.p.A. and InfoCert S.p.A. and by AgID (the Italian Governmental Digital Agency) regarding InfoCert.

* * * * *

IMPORTANT FACTS FOLLOWING THE END OF THE HALF-YEAR

On 19 July 2019, the Options on the remaining 10% of Co.Mark S.p.A.'s share capital were exercised, as defined in the Option Agreement stipulated at the time of the acquisition. The consideration was set at €5.2 million. With this transaction, Tinexta arrives at holding 100% of Co.Mark S.p.A. The transaction was funded using the financing concluded with the Intesa Sanpaolo Group on 28 March 2019.

On the same date, Tinexta completed two Interest Rate Swap transactions with Banca Intesa Sanpaolo. The transactions were activated to cover the variable rate financing contracted with Intesa Sanpaolo Group on 28 March 2019. As a result of these transactions, Tinexta has set the total cost of the entire debt of €50 million at a fixed rate of 1.237%.

On 24 July 2019, Tinexta completed another Interest Rate Swap transaction with Crédit Agricole. The transaction was activated to cover the variable rate financing concluded on 4 December 2018 for a total amount of €15 million. Through this transaction, Tinexta has fixed the total cost of the entire debt of €15 million at a fixed rate of 1.28%

On 30 July 2019, Tinexta S.p.A., under the terms of the purchase agreement signed on 9 June 2016, exercised the Options on the remaining 40% of the capital of Visura S.p.A. thereby obtaining 100% of the company. The

consideration was set at €15.4 million. The transaction was financed using €11.9 million of the financing concluded with the Intesa Sanpaolo Group (on 28 March) and for the remainder through cash on hand.

OUTLOOK

In First Half 2019, Tinexta continued to implement its strategy of:

• Consolidate its leadership in Digital Trust in the European market;
• Develop an innovative offering with digital marketing, digital transformation and cyber security services/products;
• Implement a new organizational model to strengthen business support and seize all the growth opportunities offered by presence in multiple markets

In light of the positive results reported for the first half, Tinexta confirms its 2019 growth targets, in line with the guidance already announced on 12 March:

• Revenues of more than € 250 million;
• EBITDA between 68 and 70 million euros.

It is noted that this guidance did not include the impact of IFRS 16.

* * * * *

The Manager in charge of drafting the corporate accounting documents declares, Nicola Di Liello, according to the effects of art. 154-bis, paragraph 2 of the TUF, that the information contained in this statement corresponds to the documentary findings, books and accounting records.

* * * * *

The Half-Year Financial Report at 30 June 2019 will be made available to the public within the statutory deadlines, at the company's legal headquarters – Piazza Sallustio, 9, 00187 Rome, on the authorized storage mechanism and Market STORAGE () and on the Company's website: http://tinexta.com/investor-relations/ in the Financial Reports and Presentations section.

CONFERENCE CALL

Investors and analysts who are interested are invited to participate in the Conference Call scheduled for 6 August 2019 at 10:30 a.m. (CET). The numbers to call in are as follows: +39 02 805 8811 or +44 121 281 8003. For more information, please contact the Investor Relations Office.

* * * * *

Attached: Prospectuses as of 30 June 2019 of the Total Consolidated Income Statement, the Consolidated Financial Situation, the Group's Net Financial Position and the Consolidated Statement of Cash Flows.

TINEXTA GROUP

Tinexta S.p.A., listed on the STAR segment of the Milan Stock Exchange, reported the following Consolidated results at 31 December 2018: Revenues of €239.6 million, EBITDA of €66.0 million and Net Profit of €33.1 million. Tinexta Group is one of the leading operators in Italy in its three areas of business: Digital Trust, Credit Information & Management and Innovation and Marketing Services. The Digital Trust Business Unit delivers, through InfoCert, Visura,

Sixtema and the Spanish company Camerfirma, products and services for digitization, electronic invoicing, certified email (PEC) and ature as well as services for professionals, associations and SMEs. In December 2018 InfoCert also purchased 50% of LuxTrust to form a strategic joint venture to expand in Digital Trust industry in Europe. In the Credit Information and Management Business Unit, Innolva and its subsidiaries offer services to support decision making such as corporate financial statements and real estate information, aggregate reports, synthetic ratings, decision models, credit ratings and credit recovery, while Re Valuta offers primarily real estate appraisals and evaluations. In the Innovation and Marketing Services Business Unit, Warrant Hub is a leader in consultancy to obtain subsidized financing and for industrial innovation, while Co.Mark provides Temporary Export Management consulting to SMEs to support them in commercial expansion. As of December 31, 2018, the Group's staff had 1,294 employees.

Site web: www.tinexta.com, Stock ticker: TNXT, ISIN Code IT0005037210

Media Advisor	Specialist
Barabino & Partners S.p.A.	Intermonte SIM S.p.A.
Foro Buonaparte, 22 - 20121 Milano	Corso V. Emanuele II, 9 - 20122 Milano
Tel.: +39 02 7202 3535	Tel.: +39 02 771151
Stefania Bassi: +39 335 6282 667
s.bassi@barabino.it

Consolidated Statement of Financial Position

€'000s	30/06/2019	31/12/20184 5
ASSETS
Property, plant and equipment	22,267	8,232
Intangible assets and goodwill	270,216	272,104
Investment property	585	594
Equity-accounted investments	12,659	12,533
Other investments	22	24
Other financial assets, excluding derivative financial instruments	1,139	1,123
- of which vs related parties	0	8
Derivative financial instruments	32	30
Deferred tax assets	6,517	6,677
Trade and other receivables	1,217	830
Contract cost assets	5,001	5,000
NON-CURRENT ASSETS	319,656	307,148
Inventories	1,344	1,344
Other financial assets, excluding derivative financial instruments	8,246	8,186
Current tax assets	1,297	4,519
- of which vs related parties	458	458
Trade and other receivables	88,816	86,321
- of which vs related parties	154	44
Contract assets	6,250	6,145
Contract cost assets	1,662	1,556
Cash and cash equivalents	26,660	35,136
Assets held for sale	199	199
CURRENT ASSETS	134,475	143,407
TOTAL ASSETS	454,132	450,555
EQUITY AND LIABILITIES
Share capital	46,890	46,890
Reserves	87,264	94,729
Shareholders' Equity attributable to the Group	134,154	141,619
Minority interests	3,522	3,757
TOTAL SHAREHOLDERS' EQUITY	137,676	145,376
LIABILITIES
Provisions	2,098	1,945
Employee benefits	10,770	11,353
Financial liabilities, excluding derivative financial instruments	103,960	70,667
- of which vs related parties	1,796	0
Derivative financial instruments	230	217
Deferred tax liabilities	17,172	18,246
Contract liabilities	8,938	8,395
- of which vs related parties	19	0
NON-CURRENT LIABILITIES	143,167	110,823
Provisions	288	186
Employee benefits	4,564	1,488
Financial liabilities, excluding derivative financial instruments	70,961	97,380
- of which vs related parties	858	25,252
Derivative financial instruments	0	3
Trade and other payables	51,564	53,318
- of which vs related parties	168	274
Contract liabilities	40,617	40,587
- of which vs related parties	19	0
Deferred income	947	690
Current tax liabilities	4,347	704
CURRENT LIABILITIES	173,289	194,356
TOTAL LIABILITIES	316,456	305,179
TOTAL EQUITY AND LIABILITIES	454,132	450,555

Consolidated Statement of Profit/(Loss) and Other comprehensive income

⁴ The comparative data at 31 December 2018 were restated following the completion during the first half of the current year of activities to identify the fair values of the assets and liabilities of Comas S.r.l. and Webber S.r.l. consolidated on a line-by-line basis from 1 July 2018, as well as of Promozioni Servizi consolidated on a line-by-line basis from 1 November 2018.

⁵ From 1 January 2019 the Group has adopted IFRS 16 "Leasing" retrospectively with the cumulative effect of initially applying the Standard recognised at 1 January 2019. Comparative 2018 data have not been restated.

		six months ended 30 June
€'000s	2019	20186 7
Revenues	126,592	114,510
- of which vs related parties	20	1,145
- of which non-recurring	0	179
Costs of raw materials	3,415	2,875
Service costs	40,731	38,657
- of which vs related parties	502	635
- of which non-recurring	755	401
Personnel costs	44,593	38,447
- of which non-recurring	239	134
Contract costs	4,191	4,644
Other operating costs	1,293	1,014
- of which vs related parties	0	3
Amortisation and depreciation	9,730	7,167
Provisions	132	-117
Impairment	1,158	890
Total Costs	105,242	93,577
OPERATING PROFIT	21,350	20,933
Financial income	226	82
- of which non-recurring	148	0
Financial charges	1,494	1,077
- of which vs related parties	284	248
Net financial income (charges)	-1,269	-995
Share of profit of equity-accounted investments, net of tax	15	30
PROFIT BEFORE TAX	20,096	19,968
Income taxes	6,079	5,997
- of which non-recurring	-483	-104
NET PROFIT FROM CONTINUING OPERATIONS	14,016	13,972
Profit (loss) from discontinued operations	0	0
NET PROFIT	14,016	13,972
Other components of the comprehensive income statement
Components that will never be reclassified to profit or loss:
Total components that will never be reclassified to profit or loss	0	0
Components that are or may be later reclassified to profit or loss:
Exchange rate differences from the translation of foreign financial statements	7	0
Profits (losses) from measurement at fair value of derivative financial
instruments	-2	6
Equity-accounted investees - share of OCI	3	-1
Tax effect	1	-1
Total components that are or may be later reclassified to profit (loss)	8	4
Total other components of comprehensive income, net of tax	8	4
Total comprehensive income for the period	14,025	13,976
Net profit attributable to:
Group	13,758	13,578
Minority interests	258	394
Total comprehensive income for the period attributable to:
Group	13,763	13,582
Minority interests	261	394
Earnings per share
Basic earnings per share (euro)	0.29	0.29
Diluted earnings per share (euro)	0.29	0.29

⁶ The comparative data for 1st Half of 2018 were restated following the completion during the last quarter of 2018 of the activities to identify the fair values of the assets and liabilities of Warrant Hub S.p.A. and its subsidiaries, consolidated on a line-by-line basis from 1 December 2017, as well as of AC Camerfirma S.A. consolidated on a line-by-line basis from 1 May 2018.

⁷From 1 January 2019 the Group has adopted IFRS 16 "Leasing" retrospectively with the cumulative effect of initially applying the Standard recognised at 1 January 2019. Comparative 2018 data have not been restated.

Statement of Net Financial Position of Tinexta S.p.A

	30/06/2019	31/12/2018	Change	%
A Cash	26,647	35,117	-8,470	-24.1%
B Cash equivalents	14	19	-5	-28.2%
D Liquid assets (A+B)	26,660	35,136	-8,476	-24.1%
E Current financial receivables	8,246	8,186	60	0.7%
F Current bank debt	-1,174	-8,113	6,939	-85.5%
G Current portion of non-current debt	-18,342	-12,018	-6,324	52.6%
H Other current financial debt	-51,445	-77,252	25,807	-33.4%
I Current financial debt (F+G+H)	-70,961	-97,384	26,422	-27.1%
J Net current financial position (indebtedness) (D+E+I)	-36,055	-54,062	18,007	-33.3%
K Non-current bank debt	-86,548	-45,706	-40,842	89.4%
L Other non-current financial debt	-17,642	-25,178	7,536	-29.9%
M Non-current financial debt (K+L)	-104,190	-70,884	-33,306	47.0%
N Net financial position (indebtedness) (J+M) (*)	-140,245	-124,946	-15,299	12.2%
O Other non-current financial assets	1,171	1,152	19	1.6%
P Total net financial position (indebtedness) (N+O)	-139,073	-123,793	-15,280	12.3%

(*) Net financial indebtedness computed in accordance with the provisions of Consob Communication no. 6064293 of 28 July 2006 and consistent with the ESMA/2013/319 Recommendation

Consolidated Statement of Cash Flows

€'000s	six months ended 30 June
	2019	2018
Cash flows from operations
Net profit	14,016	13,972
Adjustments for:
- Depreciation of property, plant and equipment	3,329	1,775
- Amortisation of intangible assets	6,392	5,392
- Depreciation of investment property	9	0
- Write-downs (Revaluations)	1,158	890
- Provisions	132	-117
- Contract costs	4,191	4,644
- Net financial charges (income)	1,269	995
- of which vs related parties	284	248
- Share of profit of equity-accounted investments	-15	-30
- Income taxes	6,079	5,997
Changes in:
- Inventories - Contract cost assets	0 -4,297	101 -6,749
- Trade and other receivables and Contract assets	-4,486	-8,107
- of which vs related parties - Trade and other payables	-110 -1,754	90 3,800
- of which vs related parties	-106	-15
- Provisions and employee benefits	2,748	349
- Contract liabilities and deferred income, including public contributions	830	7,076
Cash and cash equivalents generated by operations	29,600	29,987
Income taxes paid	-134	-112
Net cash and cash equivalents generated by operations	29,466	29,875
Cash flows from investments
Interest collected	8	39
Collections from sale or repayment of financial assets	185	450
Investments in shareholdings consolidated using the equity method	-27	0
Investments in property, plant and equipment	-1,212	-1,414
Investments in intangible assets	-4,504	-5,730
Increases in the scope of consolidation, net of liquidity acquired	0	286
Decreases in the scope of consolidation, net of liquidity sold	0	-23
Net cash and cash equivalents generated/(absorbed) by investing activities	-5,550	-6,392
Cash flows from financing
Purchase of minority interests in subsidiaries	-22,895	0
Repayment of loans extended by Majority Shareholder	-25,000	0
- of which vs related parties	-25,000	0
Interest paid	-1,080	-799
- of which vs related parties	-270	-252
MLT bank loans taken out	51,886	0
Repayment of MLT bank loans	-5,607	-3,976
Repayment of price deferment liabilities on acquisitions of equity investments	-2,383	-1,522
Repayment of contingent consideration liabilities	-1,347	-372
Change in other current bank payables	-6,345	-486
Change in other current financial payables	-1,691	767
Repayment of lease liabilities	-1,542	-119
- of which vs related parties	-291	0
Capital increases – subsidiaries	0	2
Dividends paid	-16,389	-10,611
Net cash and cash equivalents generated/(absorbed) by financing	-32,392	-17,117
Net increase (decrease) in cash and cash equivalents	-8,476	6,366
Cash and cash equivalents at 1 January	35,136	36,987
Cash and cash equivalents at 30 June	26,660	43,352