In the third quarter of 2017, ECA Group stressed that decision-making with respect to several major calls for tender had been regularly postponed by the clients over the last few months. This trend continued over the last two months, in particular in the Robotics and Integrated Systems division. As a result, the pace of orders received this quarter will not allow to reach the fourth quarter's ambitious revenue target and, consequently, the Group's annual revenue target.
As a result, ECA Group has decided to intensify the measures aimed at improving its operational efficiency and reducing its costs, while maintaining its strategic direction. In particular, the Group aims to reduce its costs by €4 million per year. It also considers is considering the disposal of loss-making foreign subsidiaries that have become non-strategic and whose revenue is not material at Group level.
Within this framework, ECA Group is now expecting 2017 revenue of about €105 to €110 million (not including planned disposal), compared with 2016 revenue of €103.4 million. Although current operating profitability in the second half is expected to far exceed that of the first half, it is expected to show a significant decline over the full year. Non-cash exceptional items related in particular to the planned disposals could also affect net income.
ECA Group remains confident of its commercial outlook in the medium term. The Group is well-positioned for several calls for tender; one of them could materialize in the next few weeks. The Group is ramping up the marketing of various products and solutions that have now reached maturity and that have been put on the market in the three divisions over the last few years.
This press release could contain statements on past events and forward-looking statements including statements regarding future goals or targets. Forward-looking statements reflect current expectations for results and future events.
Such forward-looking statements and targets depend on known and unknown risks, uncertainties and other factors that may cause actual results, performance or events to differ materially from those anticipated herein. All these risks and uncertainties could affect the Group's future ability to achieve its targets. Risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated in the forward-looking statements and targets include, among other things: the risks and uncertainties mentioned in the press release; the strength of competition; the continuing growth of the market; currency fluctuations; interest rate fluctuations; raw material price fluctuations; armed conflicts or political instability; control of costs and expenses; changes in tax legislation, rules, regulation or enforcement; our ability to successfully keep pace with technology changes; our ability to attract and retain qualified personnel and key personnel; the evolution, interpretation and uniform application and enforcement of International Financial Reporting Standards (IFRS), according to which we prepare our financial statements; supply chain and manufacturing bottlenecks; the performance of our business partners (subcontractors, agents, suppliers, etc.).
Some of these risk factors are set forth and detailed in our Document de Référence (Registration Document including the annual financial report filed with the French Autorité des Marchés Financiers). This list of risks, uncertainties and other factors is not limitative. Other non-anticipated, unknown or unforeseeable factors could also have material adverse effect on our targets. The Group expressly disclaims any obligation or undertaking to update or revise any forward-looking statements or targets potentially contained in this press release to reflect any change in events, conditions, assumptions or circumstances on which any such statements are based.
The ECA Group
Recognized for its expertise in robotics, automation systems, simulation and industrial processes, the ECA Group has been developing complete, innovative technological solutions for complex missions in hostile and confined environments since 1936. Its product offering is designed for an international client base that is demanding, both in terms of safety and effectiveness. The Group's main markets are in the defense, maritime, aeronautics, simulation, industrial and energy sectors.
In 2016, the Group reported revenue of €112.5 million across its three divisions: Robotics & Integrated Systems, Aeronautics and Simulation.
The ECA Group is a Groupe Gorgé company.
The ECA Group is listed on Euronext Paris Compartment C.
Indexes: SBF 250, CAC SMALL 90 and CAC IT- ISIN Code: FR0010099515
Ticker Code: ECASA - Bloomberg Code: ECASA:FP
Tel: +33 (0)1 53 67 36 72
Tel: +33(0)1 53 67 36 73
Tel: +33 (0)1 44 77 94 80
Chief Executive Officer
Tel: +33 (0)4 94 08 90 00