STREAMWIDE : 2015 Half Year Results

2015 Half Year Results

2015-09-22, Paris, France

SIGNIFICANT IMPROVEMENT IN PROFITABILITY

POSITIVE FIRST-HALF NET PROFIT, STRENGTHENING OF THE FINANCIAL STRUCTURE

Paris, September 21, 2015 - StreamWIDE (FR0010528059 - ALSTW), the specialist in next generation, value-added telephony and communication solutions, announces a significant €0.8 million increase in operating profit before amortization in the first half of 2015, in line with the increase in revenue. The operating margin, before amortization, doubled compared with the first half of 2014 and stood at 31% at June 30, 2015. Driven by positive currency effects, there was a net profit of +€0.1 million, up +€0.9 million compared with the first half of 2014.

SIGNIFICANT IMPROVEMENT IN PROFITABILITY

The increase in revenue recorded over the period (+€1 million) is mainly reflected in the operating profit before amortization (+€0.8 million). Operating costs remained virtually stable over the period, totaling €4.6 million, excluding purchases of merchandise. Excluding currency effects (€/USD), operating costs were down €0.2 million, notably following the decrease, in volume terms, in the average workforce compared with the first half of 2014. At the end of June 2015, the Group had 102 employees, compared with 111 a year earlier. Operating profit before amortization (equivalent to EBITDA) was thus significantly up compared with the first half of 2014 (+€0.8 million), and the operating margin stood at 31.1% in the first half of 2015 versus 15.3% in the first half of 2014.

There was a slight core operating loss of -€0.3 million, although this represents an improvement of €0.8 million on the previous year. This trend was a result of the decrease, in cash terms, in capitalized development costs, following the decrease in average development-per-day costs within the Group due to the reorganization and reallocation of the Group's teams undertaken throughout 2014.

The positive impact of the capitalization of development costs decreased by €0.4 million: the gross amount capitalized at June 30, 2015 was €1.1 million, versus €1.5 million a year earlier, while amortization and the reversal of the corresponding Research Tax Credit remained stable (at €1.5 million and €0.4 million respectively).

Once positive financial income of €0.3 million resulting from positive currency effects in the first half of 2015 (€/USD parity) and tax income of €0.1 million are taken into account, there was a net profit of €0.1 million, an improvement of €0.9 million compared with the first half of 2014.

INCREASE IN THE CASH POSITION, SOLID FINANCIAL STRUCTURE

At June 30, 2015, the total balance sheet stood at €22.5 million, versus €21.9 million at December 31, 2014 (see appendices). This €0.6 million increase essentially came from Accounts Receivable (+€0.4 million), directly tied to the increase in revenue, the increase in tax liabilities (2014 Research Tax Credit as yet not reimbursed and provision on the first half of 2015), the decrease in tax and employment-related liabilities (-€0.1 million), the increase in deferred revenue (+€0.8 million) and the increase in the Group's cash position (€8.3 million at June 30, 2015 versus €8.1 million at December 31, 2014, i.e. +€0.2 million).

The positive operating cash flow of €1.7 million helped finance investments in product development (-€1.4 million) and the reimbursement of bank loans over the period (-€0.1 million) (see appendices).

At June 30, 2015, the Group's financial structure remained solid, with shareholders' equity of €14.1 million and a significant net cash position of €6.2 million, hence giving the Group the means to pursue its future development.

H1 2015 REVENUE

The apathy that has dominated the sector for some time has tended to ease a little since the second half of 2014. However, although new commercial opportunities are emerging for the Group's traditional activity, inertia still remains very high and operators are taking a long time to make decisions.

As announced in July, the increase in the Group's revenue in the first half of 2015 (+€1 million) was mainly due to the increase in License revenue (+€1.8 million) partly offset by the decrease in Services revenue (-€0.7 million). License sales benefiting from a regular increase in an American client's platforms and from a major new European market. Furthermore, activity benefited from a positive base effect (license sales having fallen by 70% in the first half of 2014). Regarding services, the first half of 2014 had seen numerous operations completed over the period, which wasn't the case in the first half of 2015 - numerous projects were still ongoing at June 30, 2015. This discrepancy should entirely or mostly disappear during the second half of the year. Maintenance revenue continued to rise during the first half of 2015 (+7%). This trend should continue over the latter half of 2015.

BUOYANT AND CONTROLLED PRODUCT INVESTMENTS

The Group underwent a significant reorganization throughout 2014 in order to maintain its development and innovation capacities, which are key factors behind its success. The first half of 2015 thus benefited from this reorganization, and the development of the "Team On The Run" application solution was continued without calling into question the reliability or the expertise acquired on "core business" products.

The Group's current operating cost structure allows it to maintain this twofold positioning: presence and sales opportunities on its traditional activity, and the ongoing development of "Team On The Run" in order to address a new market with a comprehensive, reliable and efficient solution, a key factor for future buoyant growth.

OUTLOOK: STRATEGY REAFFIRMED

The first half of 2015 confirms the efforts undertaken since the end of 2013 to rationalize the Group's cost structure and enable it to return to growth and profits within a sectoral context that remains difficult. The anticipated level of revenue in 2015 should enable the structure to be better balanced while allowing the Group to finance the necessary developments for "Team On The Run". However, the Group remains cautious regarding the end-of-year trend, as some identified major orders could be postponed until 2016.

The major developments achieved for the "Team On The Run" product in the first half of 2015 (webchat, Voice over IP, walkie-talkie, NFC channels) enable every type of organization and sector to be addressed by providing a one-stop application and solution with all the standard instant communication features companies require, but also with high-value-added options depending on the activity in question. The recent launch of the innovative geolocation and fleet-management solution, available in "Team On The Run" since mid-September 2015, is an illustration of this marketing approach.

This new advanced geolocation feature supplements the Group's existing sectoral offers (hospitality, healthcare, etc.) by providing an offer that specifically addresses the transport sector. This vertical approach, which provides the best possible response to certain business needs, will be reaffirmed through to the end of 2015 while simultaneously providing other more cross-business features.

The solution is continuing to be marketed directly (targeted opportunities and distribution contracts, notably in Asia) and indirectly, via its special website (www.teamontherun.com) that gives online access to the service in SaaS mode. A growing number of organizations are directly signing up on the site every day. The second half of 2015 should therefore see significant marketing efforts undertaken regarding both the SaaS-site itself and the subscription offers it provides.

The ecosystem provided by the "Team On The Run" solution is reliable, secure and flexible. While developments and additional new features will continue over the coming months, notably thanks to the financial balance generated by the Group's traditional activity, "online" marketing should also efficiently supplement the numerous opportunities identified to date. "Team On The Run" now offers all the features companies need to carry out their digital transformation in an efficient and optimal manner. The Group is therefore still in a perfect position to reaffirm and successfully achieve its sectoral repositioning.

Next financial press release: 2015 annual revenue, on Monday February 15, 2016

Contacts:

StreamWIDE

Pascal Béglin / Olivier Truelle NewCap.Financial Communication Agency

CEO / CFO Louis-Victor Delouvrier / Emmanuel Huynh

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