First Half-year 2007 results
Noisy-le-Grand, 20 September 2007 – Staff&Line, leader in IT Management, publishes its consolidated earnings, for the 1st half-year 2007 (for the six months ended 30 June). For the first time, they incorporate a full half-year of the subsidiary, SAM UK, which was acquired at the end of October 2006.
Strategy review
In order to find growth vectors on a European scale, Staff&Line proceeded in acquiring specialised integrators in the sector and transformed them into subsidiaries dedicated to the sale of software. This model of development puts the emphasis on medium-term performance, rather than immediate profitability, by acquiring market share to reach a critical size. This strategy should enable the company to double sales, since its public floatation. However, the costs associated with the restructuring of teams, as well as the time required for integration, which varies from one acquired company to another, continues to weigh on the group’s results.
Recurrent seasonality
The seasonality, with which the company is habitually confronted, is all the more pronounced this year, as is illustrated by the trend in sales, in the first two quarters. Following the first quarter 2007, an increase of 31% compared to the first quarter 2006, and in line with the objectives, the second quarter was characterised by a large lag in the order book.
In total, first half-year sales amounted to 5 million euros, an increase of 15% compared to 1st half-year 2006.
We remind readers that the second half-year is structurally less performing than the first half-year, due to sales seasonality and the impact of costs, the quasi-total of which is fixed.
First half-year structurally loss-making
|
Summary income statement €M consolidated |
1st Half year 2007 |
1st Half year 2006 |
|
Turnover |
5.03 |
4.37 |
|
Operating expenses |
6.73 |
4.86 |
|
Operating profit |
(1.70) |
(0.49) |
|
Financial profit |
(0.02) |
(0.03) |
|
Profit before tax and extraordinary items |
(1.72) |
(0.52) |
|
Net profit |
(1.89) |
(0.41) |
First half-year operating income does not reflect Staff&Line’s annual profitability capability, notably on account of:
- the recurrence of fixed costs,
- a strong increase in variable costs linked to the growth of service activity in France, i.e. an additional 7%,
- the incorporation of the English subsidiary, in 6 months, at a cost of €1.1 million.
Total operating expenses, which amounted to €6.7 million, in the first half-year 2007, should be less than operating expenses, in the second half-year.
Strong financial position
|
Summary balance sheet Assets |
|
Liabilities |
|
|
Long-term assets |
2.97 |
Owners’ equity |
6.27 |
|
Current assets |
4.88 |
Financial liabilities |
0.54 |
|
Cash |
2.29 |
Current liabilities |
2.19 |
|
Other assets |
0.36 |
Deferred income |
1.50 |
The group’s financial structure remains strong after financing all acquisition costs and related non-recurrent expenses. Gross financial debt is very low at 0.54 million euros and the net cash position is positive at 1.7 million euros.
Outlook 2007
In the light of today’s project portfolio, the management believes the annual growth objective of 30% of sales for the current financial year is realistic. Staff&Line continues to rationalise its operating expenses, with a rebalancing of activity in France and the implementation of an outsourcing process of service activity in Portugal.
Sylvain Gauthier, CEO of Staff&Line stated: “Despite present economic-situation risks, we are rolling out our development plan through acquired companies that represent an important lever for the distribution of our software in Europe. It is a significant pool of growth that is in the process of being created, at different paces depending on the country”.
Next press release: 3rd quarter 2007 turnover on 25 October 2007
About Staff&Line
Since its creation in 1988, the company has positioned itself as a specialist in the IT management market. The company offers a range of software packages, EasyVista, designed for organisations of all sizes and covering the whole life-cycle of IT assets: incident and problem management, change management, computing equipment and configuration management, inventory and user portals. EasyVista is certified ITIL® compatible by PinkElephant. With operations in France, the UK, Italy, Spain, Portugal and USA, Staff&Line boasts over 3,300 clients in the banking, insurance, industrial, office, public administration, IT outsourcing and advisory sectors. Staff&Line is a founding member of itSMF. Staff&Line is listed on the Paris Stock Exchange (Alternext). More information at: www.staffandline.fr
