GECI International, the Digital and Technology specialist, is reporting stable first-half revenues, in line with its target to return to profitability.
FIRST-HALF KEY DEVELOPMENTS
The Group's revenues for the first half of FY 2021-22 totaled €8.4m (+20.85% at constant exchange rates and stable at current exchange rates), compared with €8.4m for the same period the previous year. The slowdown in the activities affected by the health crisis was almost completely offset by the outstanding performance achieved in Brazil, as well as the sustained growth in high performance computing (HPC) and the upturn in Finance & Telecoms.
At September 30, 2021, the breakdown of the Group's consolidated revenues was as follows: 77.1% in France, 20.2% in Brazil and 2.7% in South Africa. This factors in a negative exchange effect in Brazil for €0.3m, representing 3.25% of revenues, in view of the Brazilian real's devaluation against the euro during the first half of 2021-22.
At end-September 2021, the Group had 491 staff. To accompany the premiumization of its solutions and support its return to growth, the Group has further strengthened its sales team and its hiring of specialist staff, as well as its international network of commercial, technological and recruitment partners.
CHANGE IN REVENUES FOR EACH BUSINESS LINE AND REGION
Following its withdrawal from the automotive sector in 2020, the Group realigned its operating activities around two business divisions during the first half of the year.
- Digital, with high performance computing, IT infrastructure and cybersecurity solutions,
- Technology, with expertise in telecoms, engineering, smart products and solutions.
|(currently being audited)||Apr 2021 to Sep 2021 |
|Apr 2020 to Sep 2020 |
|€m||% of rev||€m||% of rev||(%)|
The Digital division (€4.8m, representing 57.5% of half-year revenues) is virtually stable (-1%) compared with the first half of the previous year. The IT Infrastructure activities were affected by the non-renewal of certain contracts in the context of the health crisis. This development was offset by the strong growth in HPC (+17.6%) and the Finance business, which also returned to more standard rates of growth, with sales up +9% during the first half of the year.
The Technology division (€3.6m, representing 42.5% of half-year revenues) recorded a +1.5% improvement in revenues compared with the previous year. The Telecoms business in France is back on track for growth (+2%), while the Brazilian subsidiary's revenues (+55.67% at constant exchange rates) benefited from the transformation of a major mobile network deployment contract signed in December 2020. These good performances offset the slowdown in other activities in France and South Africa.
The Group has continued to further strengthen its financial position through:
- an aggressive strategy, with a drive to reinforce the Group's teams, as well as its commercial, technological and recruitment partnerships.
- the increase in the average daily rates and the continued reduction of its overheads structure.
- a deleveraging policy, thanks in particular to financing based on ORNAN bonds redeemable in cash and/or new shares.
These financing facilities set up in September 2020, followed by the bond financing with equitization through a management trust, signed in July 2021, enabled successive capital increases to be carried out for a gross total of €1.7m, helping further strengthen the Group's equity at end-September 2021. They also enabled the Group to cover its short and medium-term obligations, while ensuring the sustainability of its financial position and securing its activities.
With the improvement in the economic environment, both in France and internationally, the Group plans to capitalize on new opportunities and further strengthen its revenues and profitability, by notably:
- Expanding its range of strong value-added solutions and significantly increasing its average daily billing rate.
- Extending its international alliances and partnerships to further strengthen its range of expertise, its platform of cybersecurity products and solutions, and its technological capabilities.
The Group is continuing to redeploy its business around the high value-added Digital and Technology markets. Already positioned to move forward, the Group is focused on combining growth with its return to a balanced financial position and profitability. Its flagship activities, such as IT infrastructure, telecoms and HPC, are already seeing progress to win back market shares with key accounts. This trend is expected to continue over the second half of the year, confirming the return to competitive growth.
2021-22 half-year earnings on December 17, 2021 (after close of trading).
ABOUT GECI INTERNATIONAL
“Smart Solutions for a Smart World”
Founded in 1980, GECI International is a specialist Digital and Technology group. From the outset, GECI International has innovated alongside major industrial and service companies and provided smart services, solutions and products for its clients, from key accounts to SMEs and startups. With its network of technological partners and expert capabilities worldwide, the Group offers integrated and competitive solutions for Finance, Services, Industry and Research.
GECI International is listed on the Euronext Growth Paris market. ISIN (shares): FR0000079634 - ALGEC.
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 As authorized by the extraordinary general meeting on November 12, 2020, on the same day the Group set up financing for a total net nominal amount of up to €9.3m through the issuing of up to 1,000 ORNAN bonds reserved for YA II PN, Ltd. During the first half of the year, 125 ORNAN bonds were converted, with 91,666,666 new shares created. There are still 600 ORNAN bonds outstanding, representing a gross total of €6m.
 As authorized by the extraordinary general meeting on June 23, 2021, the Group launched a public offering of convertible bonds in June 2021 for a maximum net total of €2,595,000 on the one hand, and on the other hand, set up an equitization mechanism for the convertible bonds, by (i) creating a management trust for the convertible bond holders that transferred their bonds to the trust, and (ii) issuing stock warrants to this trust, with their terms and conditions for exercising enabling the convertible bonds transferred in this way to be transformed into shares. In total, 2,944 convertible bonds were covered by this equitization, with 41,600,957 new shares created during the first half of the year, giving an equitization value of €0.4m.