Sword : | 2nd Quarter 2020 Results

Financial Press Release

Windhof - 28 July 2020

Sword Group

Results for the Second Quarter of 2020

Start of Negotiations with Argos with a View to Selling the Business Activities in France

RESULTS

SECOND QUARTER 2020

Consolidated Revenue: €55.0m

Consolidated Growth: + 2.6%

Organic Growth on a like-for-like basis: + 1.9%

Profitability (EBITDA margin): 14.4%

SECOND QUARTER ACOUNTS 2020

Q2

€million	2020 (1) (2)	2019
Revenue	55.0	53.6
EBITDA	7.9	7.1
EBITDA margin	14.4%	13.3%

Organic Growth + 1.9%

FIRST HALF OF 2020

Consolidated Revenue: €112.1m

Consolidated Growth: + 7.7%

Organic Growth on a like-for-like basis: + 6.0%

Profitability (EBITDA margin): 13.1%

ACCOUNTS FOR THE FIRST HALF OF 2020

H1

€million	2020 (1) (2)	2019
Revenue	112.1	104.1
EBITDA	14.7	13.9
EBITDA margin	13.1%	13.4%

Organic Growth + 6.0%

1. non audited figures
2. with application of the IFRS 16 standard

[...]

The press release will be published on the web sites here after: Thomson Reuters and Sword Group. It was also sent to the "Commission de Surveillance du Secteur Financier (CSSF)" and saved on the Luxembourg Stock Exchange's website.

Consolidated Revenue:	EBITDA margin:
€112.1m	13.1%

H1 - 2020

Organic Growth on a like- for-like basis:

+6.0%

non audited figures

Agenda

08/09/20

H1 2020 Results presentation meeting at 10

am, in Paris, Centre Arpège Trocadéro

22/10/20

2020 Third Quarter Revenue

[Methodological Note]

Regarding the definition of the alternative performance indicators mentioned above, their justification and their calculation methods, please refer to the relevant methodological note (paragraph 2 page 15 of the Annual Financial Report for 2019) as published in the Annual Report ending on 31st December 2019. To access the Annual Report, please click HERE.

Market	ICB 9530	ISIN Code	Indices		sword-group.com
Euronext Paris	Software &	FR0004180578	CAC® Small	CAC® All-Tradable
Compartment B	Computer Services		CAC® Mid & Small	CAC® All-Share

Sword Group- 2, rue d'ArlonL-8399Windhof - [e-mail]

2

ANALYSIS

The + 6% organic growth for the 1st half of 2020 at constant exchange rates on a like- for-like basis can be broken down as follows:

• Software: - 9.1%
• Services: + 7.9%

The Software division shows a decrease, mainly due to the postponement of licence revenue that was budgeted for the first half-year.

The Services division reacted to the crisis with different trends depending on the countries.

Two countries stood out in particular:

• BeLux (-0.4%) that did not show growth due to the Tipik subsidiary, in charge of the development of information systems linked to the organisation of events within the European Union.
• The UK (+ 18.9%) whose business activity was energised by the Oil market.

2020 OUTLOOK

Sword Group plans organic growth of 5%+ (versus 12% budgeted) associated with an EBITDA margin of 13% (no change in relation to the initial budget).

PROJECT TO SELL THE BUSINESS ACTIVITIES IN FRANCE

Argos Wityu and Sword Group have entered into negotiations with a view to the acquisition by Argos Wityu of the French business activities of Sword Group.

The perimeter concerned by the operation envisaged includes:

• The Services business activities currently managed by the French subsidiaries in France,
• The international Software activities with the National Trademark and Patent Offices.

This perimeter, the profitability of which is in line with the Group standards, generates a revenue trend of €60 million for 2020.

Argos Wityu is a European Fund whose investment strategy favours company growth, and who invests in particulier in the new technologies sector. While preserving the assets and expertise developed by the Group in France, Argos Wityu and the current management team of Sword France have an ambitious development project.

Sword Group will focus on:

• In France, the Software activities generally speaking,
• In the GRC sector (Risk Management and Compliance), acquisitions that provide products that are complementary to those already managed by this division,
• In the UK, Services through aggressive mainly organic growth but also supported by targeted acquisitions,
• In the other countries, the pursuit of its organic growth accompanied by potential acquisitions.

[The operation remains subject to information and consultation of the staff representatives and to approval of the anti-trust authorities.]

The press release will be published on the web sites here after: Thomson Reuters and Sword Group. It was also sent to the "Commission de Surveillance du Secteur Financier (CSSF)" and saved on the Luxembourg Stock Exchange's website.

Sword Group

Sword has 2,300+ IT/Digital & Software specialists present over 5 continents to accompany you in the growth of your organisation in the digital age.

As a leader in technological and digital transformation, Sword has since 2000 acquired a solid reputation in software publishing and in complex IT & business project management.

With Sword you have the guarantee of strong close and qualified local commitment, the aim of which is to optimise your processes and data.

Agenda

08/09/20

H1 2020 Results presentation meeting at 10

am, in Paris, Centre Arpège Trocadéro

22/10/20

2020 Third Quarter Revenue

Market	ICB 9530	ISIN Code	Indices		sword-group.com
Euronext Paris	Software &	FR0004180578	CAC® Small	CAC® All-Tradable
Compartiment B	Computer Services		CAC® Mid & Small	CAC® All-Share

Sword Group- 2, rue d'ArlonL-8399Windhof - [e-mail]