TXT E-Solutions — Interim / Quarterly Report 2015

May 12, 2015

Informazione Regolamentata n. 0439-31-2015		Data/Ora Ricezione 12 Maggio 2015 17:19:46	MTA - Star
Societa'	:	TXT e-SOLUTIONS
Identificativo Informazione Regolamentata	:	58093
Nome utilizzatore	:	TXTN01 - Matarazzo
Tipologia	:	IRAG 03
Data/Ora Ricezione	:	12 Maggio 2015 17:19:46
Data/Ora Inizio Diffusione presunta	:	12 Maggio 2015 17:34:46
Oggetto	:	Board approved first 2015 results
Testo del comunicato

Vedi allegato.

TXT e-solutions: Q1 2015 Revenues € 14.7 million (+4.9%), EBIT +2.2% Investments in R&D +11%

• Consolidated Revenues: € 14.7 million (+4.9% compared to Q1 2014), 53% from outside Italy.
• EBITDA: € 1.5 million (-2.0%) and EBIT € 1.2 million (+2.2%).
• Net income: € 1.0 million (-1.7%).
• Net Financial Position: € 12.1 million (€ 8.5 million as of December 31, 2014).

Milan – May 12, 2015

The Board of Directors of TXT e-solutions, chaired by Alvise Braga Illa, today approved the first quarter financial results for the period ended as of March 31, 2015.

First quarter 2015 recorded important Research & Development investments and costs both in North America and in Europe focused on proprietary software TXT Perform for the end-to-end planning for large Luxury, Fashion and Retail companies.

Revenues grew by 4.9%, from € 14.0 million in Q1 2014 to € 14.7 million. Sales of licences and maintenance totalled € 3.7 million (25% as a percentage of revenues), up +6.3% compared to Q1 2014.

TXT Perform, the Planning Specialist in End-to-End Retail for the Luxury and Fashion sector (59% of group revenues) were € 8.6 million, almost unchanged compared to Q1 2014 (-0.4%); TXT Next (41% of group revenues) were € 6.0 milion and grew by 13.6% compared to Q1 2014.

International Revenues were € 7.8, compared to € 8.0 million in Q1 2014 (53% of total sales, almost entirely in TXT Perform).

EBITDA was € 1.5 million substantially in line with Q1 2014 (-2.0%), mainly due to investments in R&D (+10.6%). Profitability on revenues is 10.2%.

EBIT was € 1.2 million, slightly increasing compared to Q1 2014 (+2.2%), due to lower amortization. Profitability on revenues is 8.4%.

Net Income amounted to € 1.0 million (6.6% of revenues), slightly down compared to Q1 2014 (-1.7%). Income tax charges were € 0.2 million, or 16% of pre-tax income.

Net Financial Position has risen from € 8.5 million positive as of December 31, 2014 to € 12.1 million as of March 31, 2015, due to a block sale of treasury shares (€ 3.2 million) and cash flow from operations. In Q1 2015, Cash flows generated by operations before working capital was € 1.6 million, up +9.3% compared to € 1.4 million in Q1 2014.

Shareholders' Equity as of March 31, 2015 amounted to € 33.6 million, compared to € 29.0 million as of December 31, 2014 mainly due to a block sale of treasury shares (€ 3.2 million) and net income of the first quarter (€ 1.0 million).

As of March 31, 2015 TXT holds 1,109,950 treasury shares (1,427,850 as of December 31, 2014) or 9.39% of issued shares, purchased at an average price of € 2.08.

A dividend of € 0.25 for each share will be paid on May 20, 2015 (ex-dividend date on May 18, 2015, record date on May 19, coupon nr. 7).

A new free share for every 10 owned held will be distributed after the payment of cash dividend (ex-dividend date on May 18, 2015, coupon nr. 8).

The Board of Directors has appointed Ms Fabienne Anne Dejean Schwalbe (independent director appointed last May 5, 2015) as member of the Internal Control Committee and of the Remuneration Committee. The Board appointed Ms Stefania Saviolo as Chairman of the Remuneration Committee.

Alvise Braga Illa, Chairman of TXT Group, stated: "In Q1 2015 we grew compared to Q1 2014 both in revenues and new software orders, with global projects with international customers including Moncler (I), Takko (D), Otto (D), Charles Voegele (D), White Stuff (UK), Carpisa (I) and Swatch (CH), notwithstanding difficult and uncertain economic scenario in several countries. We continue our commercial investment in North America: in New York we just organized the 6° TXT Summit on new challenges for multichannel Retail, with attendance of over 40 brands and retailers".

Significant events and Outlook after the reporting period

Year 2015 opened with increasing risks due to the international economic environment and the uncertainty in markets where TXT has a strong presence, including Fashion and Luxury. Nevertheless, the company believes it will be able to outperform the market, thanks to a strengthened presence in North America, and the development of the existing customer list, which is very wide and geographically located in different areas. The company is now also increasing its presence in selected areas of international manufacturing, which are gradually emerging from recession. The opening of the new subsidiary TXT Retail AsiaPacific Ltd in Hong Kong is undergoing.

The company foresees a development of business in the current quarter in line with last year.

Declaration of the designated officer in charge of drafting the company's accounting documents

The Designated Officer in charge of drafting the company's accounting documents, Paolo Matarazzo, herein declares, pursuant to Article 154-bis, Paragraph 2 of Legislative Decree no. 58 of 24 February 1998 that the accounting information contained in this press release corresponds to the documentary records, books and accounting entries.

As from today, this press release is available also on the company's website www.txtgroup.com

TXT e-solutions is an international specialist in high-value, strategic software and solutions for large enterprises. The main business areas are: Integrated & Collaborative Planning Solutions, with the TXT Perform Division, especially for Luxury, Fashion, Retail and Consumer Goods; Software for Complex Operations & Manufacturing, with the TXT Next Division, for Aerospace, Defence, High-Tech and Finance. Listed in the Star Segment of Borsa Italiana (TXT.MI), TXT is based in Milan and has offices in Italy, France, UK, Germany, Spain, Canada, USA, Australia and Hong Kong.

For information:

TXT e-solutions SpA

Paolo Matarazzo CFO Tel. +39 02 25771.355 paolo.matarazzo@txtgroup.com

Management Income Statement as of 31.03.2015

Amounts in thousands of Euro	Q1 2015	%	Q1 2014	%	Var %
REVENUES	14.684	100,0	13.995	100,0	4,9
Direct costs	7.108	48,4	6.607	47,2	7,6
GROSS MARGIN	7.576	51,6	7.388	52,8	2,5
R&D Costs	1.362	9,3	1.232	8,8	10,6
Commercial Costs	2.922	19,9	2.891	20,7	1,1
G&A Costs	1.801	12,3	1.744	12,5	3,3
GROSS OPERATING MARGIN (EBITDA)	1.491	10,2	1.521	10,9	(2,0)
Amortization, Depreciation	253	1,7	310	2,2	(18,4)
OPERATING PROFIT (EBIT)	1.238	8,4	1.211	8,7	2,2
Financial Income (Expenditure)	(70)	(0,5)	(68)	(0,5)	2,9
PRE-TAX INCOME (EBT)	1.168	8,0	1.143	8,2	2,2
Income Taxes	(192)	(1,3)	(150)	(1,1)	28,0
NET INCOME	976	6,6	993	7,1	(1,7)

Income Statement as of 31.03.2015

Amounts in Euro	31.03.2015	31.03.2014
TOTAL REVENUES AND INCOME	14.683.528	13.995.082
Purchases of materials and services	(3.131.528)	(3.185.976)
Personnel costs	(9.586.020)	(8.827.233)
Other operating costs	(475.057)	(460.946)
Amortizations, depreciation and write downs	(253.114)	(309.430)
OPERATING RESULT	1.237.809	1.211.497
Financial income/charges	(69.738)	(68.192)
PRE-TAX RESULT	1.168.071	1.143.305
Income Taxes	(191.934)	(150.305)
NET RESULT CURRENT ACTIVITIES	976.137	993.000
PROFIT PER SHARE (Euro)	0,09	0,10
PROFIT PER SHARE DILUTED (Euro)	0,09	0,09

Net Financial Position as of 31.03.2015

Amounts in thousands of Euro	31.03.2015	31.12.2014	Var
Cash	13.404	12.304	1.100
Short Term Debt	(1.221)	(2.154)	933
Short Term Financial Resources	12.183	10.150	2.033
Long Term Debt	(115)	(1.685)	1.570
Total Net Financial Position	12.068	8.465	3.603

Consolidated Balance Sheet as of 31.03.2015

ASSETS (Amounts in Euro)	31.03.2015	31.12.2014
NON-CURRENT ASSETS
Goodwill	13.486.449	12.993.445
Definite life intangible assets	1.945.850	2.085.369
Intangible Assets	15.432.299	15.078.814
Buildings, plants and machinery owned	1.381.620	1.248.845
Tangible Assets	1.381.620	1.248.845
Other non-current assets	142.798	136.068
Deferred tax assets	1.907.873	1.556.303
Other non-current assets	2.050.671	1.692.371
TOTAL NON-CURRENT ASSETS	18.864.590	18.020.030
CURRENT ASSETS
Inventories	1.915.136	1.820.672
Trade receivables	21.493.579	18.570.928
Other current assets	2.335.188	2.196.824
Cash and other liquid equivalents	13.404.364	12.304.130
TOTAL CURRENT ASSETS	39.148.267	34.892.554
TOTAL ASSETS	58.012.857	52.912.584
EQUITY AND LIABILITIES (Amounts in Euro)	31.03.2015	31.12.2014
SHAREHOLDERS' EQUITY
Share capital	5.911.932	5.911.932
Reserves	16.487.369	12.867.534
Retained earnings	10.190.810	6.018.431
Profit (Loss) for the year	976.137	4.172.380
TOTAL SHAREHOLDERS' EQUITY	33.566.248	28.970.277
NON-CURRENT LIABILITIES
Non-current financial liabilities	115586	1684734
Severance and other personnel liabilities	3.821.529	3.841.200
Deferred tax liabilities	1.231.102	965.428
TOTAL NON-CURRENT LIABILITIES	5.168.217	6.491.362
CURRENT LIABILITIES
Current financial liabilities	1.220.945	2.153.926
Trade payables	1.799.924	1.540.108
Tax payables	540.733	150.971
Other current liabilities	15.716.790	13.605.940
TOTAL CURRENT LIABILITIES	19.278.392	17.450.945
TOTAL LIABILITIES	24.446.609	23.942.307

TXT e-solutions S.p.A. Via Frigia, 27 - 20126 Milano (Italy) Tel. +39 02 25771.1 Fax +39 02 2578994 www.txtgroup.com

Consolidated Statement of Cash Flows as of 31.03.2015

Amounts in Euro	31.03.2015	31.03.2014
Net Income	976.137	993.000
Non cash costs	2.652	24.287
Paid taxes	410.173	145.162
Variance in deferred taxes	(85.896)	(41.040)
Amortization, depreciation and write-downs	253.114	302.704
Cash flows generated by operations before working capital	1.556.180	1.424.113
(Increase) / Decrease in trade receivables	(2.922.651)	(1.114.075)
(Increase) / Decrease in inventories	(94.464)	(528.682)
(Increase) / Decrease in trade payables	259.817	(114.988)
(Increase) / Decrease in severance and other personnel liabilities	(19.671)	9.297
(Increase) / Decrease in other current assets/liabilities	2.029.484	3.057.216
Changes in working capital	(747.485)	1.308.768
CASH FLOW GENERATED BY OPERATIONS	808.695	2.732.881
Increase in tangible assets	(244.356)	(75.410)
Increase in intangible assets	(4.666)
CASH FLOW GENERATED BY INVESTING ACTIVITIES	(249.022)	(75.410)