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Annual Results 2010: Growth in turnover and profitability

Annual Results 2010: Growth in turnover and profitability

Turnover: +20.6%, Operating income: +38%, Net profit: +23.5%
Dividend proposed: 2.5 euros per share
Good forecast for 2011

Bagnolet, 10 March 2011

Meeting on 09 March 2011, the Board of Directors closed the accounts for 2010 on 30/12/2010. These accounts were audited and are available on Infotel’s website: www.infotel.com.

In €M, at 31 December20102009Δ 2010 / 2009
Q127.822.2+ 25.6%
Q226.920.7+ 29.8%
Q324.621.9+ 12.1%
Q428.324.4+ 15.9 %
Annual Turnover:107.689.2+ 20.6%
where Services Turnover102.283.6+ 22.2%
where Software Turnover5.45.7(5.2%)
Operating Income9.6*7.0+ 38.0%
In % of turnover8.9%7.8%
Recurring Net Profit (Group Share)6.45.2+ 23.5%
In % of turnover6.0%5.8%

* after the reclassification of the CVAE in taxes for an amount of €0.87 M

Activity: Infotel surpasses €100 M

Infotel had in 2010 a turnover of € 107.6 M, an increase of 20.6% compared to 2009. This growth was brought by the dynamism in the Services division (95% of the turnover), which grew 22.4%, as well as the acquisition of Addax (consolidated as of 1 January 2010) which accounted for € 5.1 M in the year.

On a like-for-like basis, the turnover was € 104.3 M, with an organic growth of 16.8%, grossly superior to the market average.

The pro forma annual turnover (Harwell Management accounted for from 1 July 2010) was €109.5, in line with the target Infotel had set for 2010.

Results: strong growth in profitability

The operating income of the year was € 9.6 M, with an operating margin rate of 8.9% of turnover, as opposed to 7.8% in 2009. With the reclassification of the CVAE for a sum of € 0.87 M, the operating margin increased to 8.1%.

This net recovery of profitability during the year results from a very good first half (9.1% operating margin) and second half (8.7% operating margin) marked notably by the negative impact of the equity accounting of Harwell and higher subcontracting as a result of the increase in activity.

The operating expenditure increased at a lower rate than turnover: staff-related expenditure represented 45.8% of turnover in 2010 (as opposed to 49.6% in 2009), and external subcontracting costs were 35.1% of turnover (as opposed 32.5% in 2009).

The net profit of the group rose to € 6.4 M (6% of turnover), an increase of 23.5%.

The financial situation of Infotel at 31 December 2010 proves to be particularly solid, with €38.1 M equity, no debt, and a high net cash (€19.6 M) after the acquisition of Addax.

Dividend proposal: 2.5 euros per share

The Board of Directors proposed to the Shareholders’ Meeting of 25 May 2011 the payment of a dividend of 2.5 euro per share for 2010.

Forecast for 2011: continued growth and increase in profitability

Infotel has good forecast for its two areas of activity and approaches 2011 with confidence.

The Services activity has a robust dynamic. Software should benefit from several growth relays, such as the agreement with IBM regarding the distribution of the Merge Backup software, the commercialisation of the new computer-aided testing software Infoscope Tests and sales of the archiving and dematerialisation software Arcsys.

The Group also expects to continue its margins, notably with the recovery in IBM sales, generating royalties, and a continuous increase in provisions.

Against that backdrop, Infotel announces the creation of a consulting subsidiary specialised in IT project management. Known as Infotel Business Consulting (IBC), the structure will provide a complementary offering to that of Infotel‘s service provision.

The Group expects for 2011 a turnover of €120 M (with external growth) associated with a rise in profitability.

Next meeting:
Publication of Q1 2011 turnover: 04 May 2011 (after trading)

About Infotel

Listed on Compartment C of Euronext Paris since January 1999 (ISIN code FR0000071797), Infotel is an expert in database management and web applications. At the cutting edge of technology innovation, Infotel develops its expertise in two complementary divisions: IT services and high-tech software publishing. As part of its “Ambitions 2012” plan, Infotel has set itself two major goals: perform almost all service provision from its service desks, and become a front-line player in dematerialisation. In 2010, Infotel had a turnover of €107.6 M.

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