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  ECONOCOM company press release from 26/07/2022

  26/07/2022 - 18:05

ECONOCOM: STRONG GROWTH IN REVENUE AND ROP IN H1 2022


Strong growth1 in revenue and ROP2 in H1 2022

Confirmation of the organic growth1 target of annual revenue in 2022 of 5%

Significant growth in the first half of 2022

  • Revenue up1 9.0% at €1,240 million

  • Recurring operating profit (ROP)2 up1 12.6% at €58.8 million

  • Consolidated net profit up3 10.8% at €33.6 million

Business recovery confirmed and high operating margin maintained

The Econocom Group generated a revenue of €1,240 million in the first half of 2022, a sustained increase1 of 9.0% compared to H1 2021. As a result of the reclassification of certain entities into discontinued activities as of 1 January 2022, these activities, which generated €125 million in revenue in the first half of 2022, are not included in the revenue of the continued activities.

Over the period, trends in continued activities were as follows:

• Products & Solutions (P&S) revenue amounted to €493 million, up1 12.0%. Econocom enjoyed positive trends in the digital asset distribution market and benefited from its strong order backlog at the end of 2021, despite the persistence of supply chain issues. P&S ROP2 increased1 by 6.3% to €16.9 million.

• Technology Management & Financing (TMF) confirmed the recovery of its business, with revenue up1 14.0% at €499 million. TMF ROP2 was €21.6 million, representing a margin of 4.3%.

• Services generated €248 million in revenue, down1 4.4%. By contrast, the margin increased by 1.1 percentage points to 8.2%.

Group recurring operating profit2 (ROP) increased1 by 12.6% to €58.8 million, compared to €52.3 million for the same period in 2021. The first half operating margin was 4.7%, stable compared to H1 2021.

After non-recurring operating expenses of €10.2 million, a net financial expense of €5.8 million and an income tax expense of €6.4 million, first half net profit from continued activities was €35.5 million, versus €24.8 million in the first half of 2021, entailing strong growth3 of 42.7%.

After deducting earnings from discontinued activities, consolidated net profit was €33.6 million, up3 10.8%.

Net financial debt (NFD)4 remains under control

NFD4 was €272 million at 30 June 2022, compared to €217 million a year earlier. The increase is attributable notably to the decline of approximately €60 million in factoring and treasury share purchases totalling €40 million over the last 12 months.

Outlook 

Econocom maintains its forecast of 5% organic growth in revenue for the full year 2022.

Next publication: information meeting on H1 2022 results, 28 July 2022

1 For continued activities, at constant scope and accounting standards, including organic growth of acquired companies

2 Before amortisation of intangible assets from acquisitions

3 At constant accounting standards

4 NFD: Net Financial Debt including current and non-current financial debt and excluding liabilities arising from the application of IFRS 16 to leases (offices, vehicles, etc.) for which Econocom is the lessee

About ECONOCOM
Econocom is a digital general contractor (DGC)). The group conceives, finances and facilitates the digital transformation of large firms and public organisations. It has 49 years' experience and is the only market player offering versatile expertise through a combination of project financing, equipment distribution and digital services. The group operates in 16 countries, with over 8,200 employees. It made €2,505m in revenue in 2021. Econocom is listed on Euronext in Brussels, on the BEL Mid and Family Business indexes.
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Investor and shareholder relations contact:
nathalie.etzenbach@econocom.com
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INCOME STATEMENT

(€m) H1 2021
Restated
H1 2022
Revenue 1,092.6 1,239.5
Recurring operating profit before amortisation of intangible assets from acquisitions 52.3 58.8
Recurring operating profit 51.3 57.8
Other non-recurring income and expenses -7.5 -10.2
Operating profit 43.7 47.7
Cost of financial debt -3.7 -3.0  
Other financial income and expenses -2.0 -2.8  
Profit before tax 38.0 41.9
Income tax expense -13.2 -6.4
Net profit from continued activities 24.8 35.5
Net profit from discontinued activities, associates and joint ventures 5.5 -1.9
Net profit for the period 30.3 33.6
Recurring net profit 31.1 44.0

BALANCE SHEET

(€m) ASSETS 31.12.2021
Restated
30.06.2022
Goodwill 495 506
Other non-current assets 216 202
Residual interest in leased assets 171 172
Trade and other receivables 796 859
Other current assets 185 171
Cash and cash equivalents 406 309
Assets held for sale 69 167
TOTAL ASSETS 2,339 2,386
(€m) EQUITY & LIABILITIES 31.12.2021
Restated
30.06.2022
Equity attributable to owners of the parent 381 343
Non-controlling interests 58 77
EQUITY 439 420
Bonds 252 358
Financial liabilities 221 223
Liabilities for repurchases of leased assets 98 99
Provisions 68 81
Trade and other payables 882 819
Other liabilities 348 322
Liabilities held for sale 31 64  
TOTAL EQUITY AND LIABILITIES 2,339 2,386  

Appendix: Reconciliation between financial data at the end of H1 2021 as reported in the 2021 half-yearly report and data contained in the 2022 half-yearly report.

“H1 2021 reported” corresponds to revenue and ROP2 as presented in the 2021 half-year report.

“H1 2021 restated” corresponds to H1 2021 revenue and ROP2 as presented in the 2022 half-yearly report released today and takes into account changes in discontinued activities as defined by IFRS 5 and changes in accounting presentations. It serves as the basis for calculating growth rates at constant standards.

“H1 2021 pro forma” corresponds to H1 2021 restated revenue and ROP2 also adjusted for changes in exchange rates and consolidation scope (acquisitions and disposals). It serves as the basis for calculating growth rates at constant standards and scope.

Revenue (€m) Group total TMF P&S Services
H1 2021 reported 1,240 446 524 270
Deconsolidation of discontinued activities and changes in accounting presentations -147 -13 -134 -
H1 2021 adjusted 1,093 433 390 270
Forex impact 2 2    
Change in consolidation scope (acquisitions) 52 3 49  
Change in consolidation scope (disposals) -11     -11
H1 2021 pro forma 1,137 438 440 259

 

ROP2 (€m) Group total TMF P&S Services
H1 2021 reported 62.3 17.5 24.7 20
Deconsolidation of discontinued operations and activities and changes in accounting presentations -10.0 0.2 -9.8 -0.3
H1 2021 adjusted 52.3 17.7 14.9 19.7
Forex impact 0.3 0.1 0.2  
Change in consolidation scope (acquisitions) 0.9 0.1 0.8  
Change in consolidation scope (disposals) -1.3     -1.3
H1 2021 pro forma 52.3 17.9 15.9 18.4

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  Original Source: ECONOCOM