Aubay : SFAF Presentation – 2020 H1 Financial Results

H1 2020 RESULTS

Conference Call Meeting of 17 September 2020

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CONTENTS

OPERATING

HIGHLIGHTS

FINANCIAL

RESULTS

2020

OUTLOOK

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CONTENTS

OPERATING

HIGHLIGHTS

FINANCIAL

RESULTS

2020

OUTLOOK

STRONG RESILIENCE IN UNPRECEDENTED CIRCUMSTANCES

Key performance indicators maintained at high levels

Sales steady at constant structure

Operating margin from ordinary activities at the higher end of the guidance range

A marginal decrease in staff levels resulting from the hiring freeze mainly in France

Net income remains at a high level and excellent cash flow generation

GROWTH OF

3.2% o/w -0.6% in organic growth

vs. guidance of 5%-7%

OPERATING MARGIN FROM ORDINARY ACTIVITIES

8.7%

vs. 9.2% in H1 2019

WORKFORCE

6,411

vs. 6,503 at 31/12/2019

NET INCOME

€11.3m

vs. €11.5m in 2019

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FIRST HALF HIGHLIGHTS

• Revenue more robust than expected at the beginning of the lockdown due to:
• • the strategic importance of IT for key accounts,
  • the segment mix (Bank, Insurance, Telecom, Energy),
  • widespread recourse to teleworking,
  • the right business mix: times & material services / service centres
  • agility and rapid execution by teams.
• Greater ease in navigating international markets during the crisis.
• A reduction in staff levels reflecting the curtailment in recruitment.
• Customers privileging their historic service providers though increased complexity for acquiring new customers.

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CONTENTS

OPERATING

HIGHLIGHTS

FINANCIAL

RESULTS

2020

OUTLOOK

REVENUE: H1 2015…H1 2020

+3.7%

+22.1% 169.0

164.4

+3.2%

+5.5%

197.4 208.1 214.8

• EXCL. FRANCE

49%

134.6

91,4 92,3

81,1

101,6

107,3 110,2

CAGR OVER 5 YRS.

10%

73 76,7

53,5

95,8 100.8 104,6

UTILISATION RATE

H1 2015

H1 2016

H1 2017(*)

H1 2018

H1 2019

H1 2020

Other countries France

REVENUE GROWTH (€M)

1. RESTATED FOR IFRS 15

92.7%

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REVENUE BY SECTOR IN H1 2020

2020 vs. 2019

Services	Industry	Public
/ Utilities	/ Transportation	Sector

10%

+33%

Insurance

23%

+0.4%

Bank /Finance

36%

-3%

7%					8%
		+6%					+7%
											Telecoms
									15%
Revenue by		+3%
business

sector (YoY)

Retail

1%

+36%

Percentage of H1 2020 sales

Revenue growth: H1 2020 vs. H1 2019

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WORKFORCE (FULL-TIME EQUIVALENT)

Since 31/12/2019

- 92 less employees

BREAKDOWN BY REGION

 France =

2,520

• International = 3,891

 Total =

6,411

92.2% consultants

H1 2020 results - Conference Call Meeting of 17 September 2020

France/UK

2,520 vs. 2,660

Spain / Portugal

1,783 vs. 1,769

2020

2019

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Belgium / Luxembourg

194 vs. 189

Italy

1,914 vs. 1,885

INCOME STATEMENT HIGHLIGHTS

(€	H1 2020	H1 2019	Change
'000s)	214,777	208,115	3.2%
Revenue
Operating profit from ordinary activities	18,791	19,069	-1.5%
% of revenue	8.7%	9.2%
Cost of performance shares	(464)	(743)
Other operating income and expenses	(906)	(690)
Operating profit	17,421	17,636	-1.2%
Net financial income (expense)	(302)	(306)
Tax income/(expense)	(5,814)	(5,838)
Net income of equity accounted investees
Net income of consolidated companies	11,305	11,492	-1.6%
% of revenue	5.3%	5.5%
Net income attributable to owners of the parent	11,287	11,492
Earnings per share	€0.86	€ 0.87

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INCOME STATEMENT HIGHLIGHTS BY REGION:

REVENUE

(IN €M)

	H1 2020	H1 2019
Group	214.8	208.1	+3.2%
France	110.2	107.3	+2.7%
International	104.6	100.8	+3.7%

OPERATING MARGIN

FROM ORDINARY ACTIVITIES

H1 2020	H1 2019
8.7%	9.2%
7.5%	9.7%
10.1%	8.6%

• Growth outperforming the market in all regions
• Contraction in France of 4.6% at constant structure though the successful acquisition of large-size projects
• Continuing momentum for business development in Southern Europe.

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BALANCE SHEET HIGHLIGHTS

ASSETS

LIABILITIES

In €m	30/06/2020	31/12/2019
Goodwill	131.3	131.4
Other fixed assets	29.1	32.0
of which right-of-use assets	20.6	23.0

In €m	30/06/2020	31/12/2019
Shareholders' equity	192.0	184.2
attributable to owners of
the parent
Shareholders' equity	0.1	0.1

Other non-current assets

2.2

3.1

attributable to NCI

Other current assets	169.7	181.9
Cash & cash equivalents	34.6	24.5
Total assets	366.9	372.9

Non-current liabilities	27.8	29.8
of which lease liabilities	20.9	23.3
Borrowings and financial	11.7	12.8
liabilities
Current liabilities	135.3	146.0
Total Equity & Liabilities	366.9	372.9

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CASH FLOW HIGHLIGHTS

In €m	H1 2020	H1 2019	Change
Cash flow	22.3	21.8
% of revenue	10.4%	10.5%
Tax payments	(0.1)	(5.4)
Change in WCR	(4.2)	(4.3)
Net cash provided by (used in)	18.0	12.1	+50%
operating activities
Net cash provided by (used in)	(0.3)
investing activities
Net cash provided by (used in)	(7.4)	(11.3)
financing activities
Net change in cash and cash	10.3	0.3
equivalents
Opening cash and cash equivalents	24.1	19.4
Closing cash and cash equivalents	34.4	19.7

Dividend payments:	€3.6m
Debt repayments:	€2.5m
New debt:	€1.5m

CASH AT BANK AND IN HAND + MARKETABLE SECURITIES =	€34.6m
SHORT-TERM BANK FACILITIES AND OVERDRAFTS =	€0.2m
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CHANGES IN GROSS DEBT

In €m

Gross debt at 31/12/2019	12.8
Repayments in the period	(2.5)
New debt	1.5
Gross debt at 30/06/2020	12.0
Cash at bank and in hand	34.6
Net cash at 30/06/2020	22.6

POSITIVE NET CASH POSITION

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CONTENTS

OPERATING

HIGHLIGHTS

FINANCIAL

RESULTS

2020

OUTLOOK

VISIBILITY IS IN THE PROCESS OF IMPROVING

• Reassuring exchanges with customers. Projects are being relaunched after a period of excessive caution.
• Demand is returning to normal levels.
• The gradual return of operational and commercial teams is clearly facilitating business development.
• Confirmation of our resilience over the summer with a level of activity in line with expectations.
• Several competitive bids won including important successes for service centres.
• Resumption of recruitment in France over the summer. The workforce is expected to resume its expansion between now and year end.

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A GOOD LANDING EXPECTED FOR 2020 IN LIGHT OF THE CONTEXT

Forecasts are based on the assumption of stability in terms of the health situation.

REVENUE (€M)		OPERATING MARGIN FROM ORDINARY
		ACTIVITIES
€420m-€425m		9 %

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INTERIM DIVIDEND / SHAREHOLDER STRUCTURE

ANNUAL DIVIDEND TRENDS

Regular increases since the beginning

in €

0,70

	0,6	0,6
0,60
0,47
0,50
	0,41
0,40
0,30
0,30
0,23
0,20	0,18 0,18 0,20
0,14
0,10

0,00

'10 '11 '12 '13 '14 '15 '16 '17 '18 '19

DIVIDEND

The Board of Directors decided to pay an interim dividend of €0.33 (same as last year) payable on 10 November 2020.

SHAREHOLDER STRUCTURE AT 31/12/2020

	% of	% of
	Capital	Voting rights
Partners / Managers	47.22	61.99
Free float	52.72	38.01
Treasury shares	0.06	-

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YOUR QUESTIONS?

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CONTENTS

APPENDICES

	AUBAY IN
3.1
	BRIEF

3.2 FINANCIALS

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20 YEARS TO BUILD A DISTINCTIVE IDENTITY AND NAME RECOGNITION

Today, Aubay is…

• The most important Digital Service Provider created since 1998
• A Pure Player in its two target markets:
• • digital transformation & IT industrialisation
• A compact and legible organisation
• • 1 country = 1 legal entity
  • The same organisation, the same brand
• A stable management team, but with a successful track record in regularly integrating new talents
• A culture of growth, based on a balance of organic and external growth
• • 30 acquisitions
• 6,503 employees, 92% of which are engineers or equivalent
• Exclusively Tier 1 customers
• A targeted geographical presence:
• • in those markets where our customers are and are going
• Quality & proximity and determination
• A virtuous development strategy : ambition & prudence

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AUBAY, A EUROPEAN DIGITAL S

• Created in 1998, listed on Euronext (SBF 250)
• 17 offices in 7 European countries

A strengthened European presence

Revenue by market

France 51%

Italy 26%

Spain /

PROVIDER

• 47.2% of the capital held by managers
  Group revenue (€m)

417,8

400,6

353,6

326,4

243,3 273,8

Portugal

19%

Belux 4%

Engineers and Consultants at 31/12/2019

Total = 6,503

France

2,660

Belgium /

Luxembourg

189

Spain /

Portugal Italy

1,7691,885

2014

2015

2016

2017

2018

2019

Revenue by engagement type

DELEGATION

DELEGATION OF

OF RESPONSIBILITIES

SKILLS45%

55%

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AUBAYA E,UROPEANA EUROPEANDIGITALCUSTOMERSERVICEBASEPROVIDER

2019 revenue by business sector (%)

38%

23%

					16%
		8%	7%	8%
						1%
Bank/	Insurance	Public	Industry /	Services/U	Telecoms/	E-commerce /
Finance		sector	Transport	tilities	Media/	Retail
					Gaming

The top 15 Group customers

BNP PARIBAS

GROUPE CRÉDIT AGRICOLE

ALLIANZ

AXA

GRUPO SANTANDER

SOCIETE GENERALE

GROUPE BPCE

ITALIAN POSTAL SERVICE

ERICSSON

ORANGE

TIM

SNCF

VODAFONE

INTESA SAN PAOLO

AVIVA

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OUR DNA

A family-held growth company

500

400

300

200

100

0

1. HANDS-ON MANAGEMENT TEAM...

Revenue growth (€m)

A culture of GROWTH

Balancing internal growth with acquisitions

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Trends for Op. profit for ordinary activities (€m)

40

30

20

10

0

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

A culture of PROFITABILITY

A balance between Ambition and Caution (a capacity for adaptation)

10000

5000

0

Dividends (€ '000s)

A commitment to SHAREHOLDER RETURNS

Dividend policy: approx. 30% of net income (annual increases since 2002)

1998

1999

2000

2001

2002

2003

2004

2005

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2019

• CREATING STEADING GROWTH IN VALUE

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A VIRTUOUS CIRCLE OF GROWTH

			Improving margins		Acquiring marginally
Gradually creating value	and cash flow generation		profitable companies
	&		&		though
	Shareholder returns	Rapid integration under a		well-positioned
			common banner		in their markets

Recruiting highly qualified candidates

Master's degree	Engineering
or equivalent	degree	MANAGE,
43%	41%
RECRUIT,	ACQUIRE

SELL &

INNOVATE

Bachelor's degree or equivalent

16%

+1,700 highly qualified candidates recruited in	INTEGRATE &
REORGANISE
2019
Relevant proposals
Attractive customers
	30 successfully integrated acquisitions

Recent successful acquisitions:

• Quantic, France, 2019
• Business assets,
  Italy, 2017
• CastInfo, Spain, 2015
• Norma4, Spain, 2014
• Aedian, France, 2013
• BSC, Italy, 2013
• Adex, France, 2010
• Selex Elsag, Italy, 2011
• Projipe, France, 2006
• WhyNot, France, 2005

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CONTENTS

APPENDICES

3.1 ABRIEFUBAY IN

3.2 FINANCIALS

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INCOME STATEMENT AT 30/06/2020

(€ '000s)	30/06/2020	%	30/06/2019	%
Revenue	214,777	100%	208,115	100%
Other operating income	244		72
Purchases used in production and external charges	(43,205)		(37,711)
Staff costs	(147,290)		(146,237)
Taxes other than on income	(1,791)		(1,713)
Amortisation, depreciation and provisions	(3,840)		(3,546)
Change in inventories of work in progress and finished goods
Other current operating income and expenses	(104)		89
Operating profit from ordinary activities	18,791	8.7%	19,069	9.2%
Expenses linked to restricted share unit awards and similar share-based payments	(464)		(743)
Current operating profit	18,327	8.5%	18,326	8.8%
Other operating income and expenses	(906)		(690)
Operating profit	17,421	8.1%	17,636	8.5%
Income from cash and cash equivalents
Net borrowing costs	(283)		(177)
Other financial income and expenses	(19)		(129)
Net financial income (expense)	(302)		(306)
Tax	(5,814)	34%	(5,838)	34%
Income from equity-accounted investees
Net income before results of discontinued operations or assets held for sale	11,305		11,492
Net income after tax of discontinued operations or assets held for sale
Net income	11,305	5.3%	11,492	5.5%
Attributable to shareholders	11,287		11,492
Attributable to non-controlling interests	18		0
Basic weighted average number of shares	13,190,560		13,180,931
Earnings per share	0.86		0.87
Diluted weighted average number of shares	13,243,060		13,279,431
Diluted earnings per share			0.87
	0.85

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STATEMENT OF FINANCIAL POSITION AT 30/06/2020

ASSETS (€ 000s)	30/06/2020	31/12/2019
Goodwill	131,305	131,412
Intangible assets	835	828
Property, plant and equipment	5,409	5,575
Right-of-use (ROU) assets	20,603	22,996
Equity-accounted investees	-	-
Other financial assets	2,256	2,661
Deferred tax assets	2,163	2,796
Other non-current assets	32	277
NON-CURRENT ASSETS	162,603	166,545
Inventories and work in progress	335	411
Contract assets	36,195	29,216
Trade receivables and related accounts	101,059	115,097
Other receivables and accruals	32,040	37,209
Marketable securities	503	1,056
Cash at bank and in hand	34,130	23,411
CURRENT ASSETS	204,262	206,400
TOTAL ASSETS	366,865	372,945

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STATEMENT OF FINANCIAL POSITION AT 30/06/2020

LIABILITIES (€ 000s)	30/06/2020	31/12/2019
Capital	6,603	6,597
Additional paid-in capital and consolidated reserves	174,089	151,164
Net income attributable to the Group	11,305	26,409
Shareholders' equity attributable to the Group	191,997	184,170
Attributable to non-controlling interests	109	91
SHAREHOLDERS' EQUITY	192,106	184,261
Borrowings and financial liabilities: non-current portion	4,486	5,697
Lease liabilities: non-current portion	15,740	17,823
Deferred tax liabilities	4	5
Provisions for contingencies and expenses	6,395	6,129
Other non-current liabilities	386	489
NON-CURRENT LIABILITIES	27,011	30,143
Borrowings and financial liabilities: current portion	7,260	7,124
Lease liabilities: current portion	5,188	5,435
Trade payables and related accounts	40,624	45,298
Other payables and accruals	94,676	110,684
CURRENT LIABILITIES	147,748	158,541
TOTAL EQUITY AND LIABILITIES	366,865	372,945

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STATEMENT OF CONSOLIDATED CASH FLOWS AT 30/06/2020

	(€ 000s)			30/06/2020	30/06/2019
	Consolidated net income(including non-controlling interest)				11 305	11,492
	Income from equity-accounted investees
	Net exceptional depreciation, amortisation and provisions				4 150	3,661
	Non-cash expenses and income relating to share-based payments			464	743
	Other non-cash items				212
	Dividend income					(88)
	Gains and losses on disposals of fixed assets				101	6
	Cash flow after net interest expense and tax			16 232	15,814
	Net borrowing costs				283	177
	Tax expense (including deferred taxes)			5 814	5,838
	Cash flow before net interest expense and tax (A)				21 899	21,829
	Income tax payments (B)			(130)	(5,403)
	Change in operating working capital requirements (including liabilities relating to employee benefits) (C)		(4 231)	(4,296)
	Net cash provided by (used in) operating activities (D) = (A+B+C)			12 130	12,130
	Outflows for the acquisition of tangible and intangible fixed assets				(646)	(1,871)
	Inflows from the disposal of tangible and intangible fixed assets
	Outflows for the acquisition of financial assets				(4)	(4)
	Inflows from the disposal of financial assets					32
	Change in loans and advances granted				388	(6)
	Outflows (inflows) linked to business combinations net of cash acquired
	Dividends received				-	88
	Net cash provided by (used in) investing activities			(262)	(1,761)
	Proceeds from capital increases
	Amounts received upon the exercise of stock options
	Purchases of treasury shares for cancellation
	Purchases of and proceeds from the sale of treasury shares
	Dividends paid in the period
	Net dividends paid to parent company shareholders			(3 562)	(4,354)
	Dividends paid to the non-controlling shareholders of consolidated companies
	Inflows from new borrowings			1 520	1,235
	Repayment of debt				(2 482)	(4,176)
	Repayment of lease liabilities			(2 609)	(2,607)
	Net interest payments				(283)	(173)
	The purchase of non-controlling interests (put options)
	Other financial flows
	Net cash provided by (used in) financing activities (F)			(7 416)	(10,075)
	Effects of changes in foreign exchange rates (G)				(40)	(1)
	Change in net cash (D+E+F+G)			10,250	293
	Cash and cash equivalents at the beginning of the year				24,131	19,372
	Cash and cash equivalents at year-end			34,381	19,665
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CHANGE IN SHAREHOLDERS' EQUITY AT 30/06/2020

		Additional paid-in	Net income	Equity	Non-
	Share	attributable to
	capital and	attributable to	controlling	Total
	capital	owners of the
	consolidated reserves	the Group	interests
			parent
Shareholders' equity at 1 January 2019	6,568	131,516	27,327	165,410		0	165,410
Increase and reduction in capital	29	(28)		1			1
Share-based payments		1,408		1,408			1,408
Dividends		(8,703)		(8,703)			(8,703)
Net income appropriation		27,327	(27,327)	-		-	-
Net income for the period			26,409	26,409		26,409
Change in treasury shares		(4)		(4)			(4)
Change in Group structure				0		91	91
Flows related to equity-accounted investments				-		-	-
Other changes		(69)		(69)			(69)
Other comprehensive income		(282)		(282)			(282)
Shareholders' equity at 31 December 2019	6,597	151,165	26,409	184,170		91	184,261
Shareholders' equity at 1 January 2020	6,597	151,165	26,409	184,170		91	184,261
Increase and reduction in capital	6	(6)					0
Share-based payments		477		477			477
Dividends		(3,562)		(3,562)			(3,562)
Net income appropriation		26,409	(26,409)				0
Net income for the period			11,287	11,287	18	11,305
Change in treasury shares		(198)		(198)			(198)
Change in Group structure							0
Flows related to equity-accounted investments							0
Other changes		(14)		(14)			(14)
Other comprehensive income		(163)		(163)			(163)
Shareholders' equity at 30 June 2020	6,603	174,108	11,287	191,997		109	192,106

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