SQLI: displays H1 2021 results in line with its forecasts
The European digital services group SQLI today announced its results for the first half of 2021, which were approved by the Board of Directors, chaired by Philippe Donche-Gay. The auditors performed the limited review procedures. The interim financial report will be published on September 24, 2021.
With H1 turnover up 3.3% and current operating margin up 2.2 points, SQLI is in line with its annual objectives. The Group is thus in a position to confirm its trajectory throughout the year.
GROWTH OF 3.3% IN TURNOVER, THANKS TO THE RECOVERY IN FRANCE AND CONTINUED GROWTH ABROAD
The Group achieved consolidated sales of â¬ 113.8 million in H1 2021, up 3.3%, of which + 1.5% at constant scope and exchange rates.
SQLI’s activity in France rebounded strongly in Q2 2021 (+ 20%), offsetting the decline recorded in Q1 2021 (-16%). This performance is the result of the successful redeployment of talent on high added value projects and the improvement in the activity rate (+7 points in 1 year at 79%).
Internationally, growth (+ 8.4%) is all the more remarkable given that the Group had already recorded growth in its activity in H1 2020 (+ 6% organically) despite the onset of the health crisis. All countries recorded growth in the first six months of 2021 except Germany.
2.2 POINT INCREASE IN CURRENT OPERATING MARGIN
Thanks to the growth in activity, combined with the improvement in the activity rate and the increased use of Service Centers, the current operating margin began to recover, representing 5.8% of sales in H1 2021, up 2.2 points compared to H1 2020. With current operating income of 6.6 M â¬, SQLI is erasing the impact of the 2020 crisis and resumes an upward trend in its profitability, higher than that of from 2019.
After taking into account other operating income and expenses (- â¬ 0.9 million), operating profit (EBIT) stood at â¬ 5.7 million against â¬ 4.6 million the previous year.
Thanks to a controlled cost of net financial debt (â¬ 1.4m) and a tax charge of â¬ 1.5m (â¬ 3.0m in H1 2020 related to the cancellation of deferred taxes) , the Group generated net income of â¬ 2.8 million, an increase of â¬ 2.3 million.
MAINTAINING DEBT RATIOS
Despite the impact of growth and seasonality on the working capital requirement (including trade receivables increasing in days of sale) and some one-off effects on cash at the end of June (â¬ 29.1 million compared to â¬ 39.8 million â¬ at the end of December 2020), SQLI continued debt reduction in the first half of the year (gross financial debt of â¬ 50.2 million compared to â¬ 55.5 million at the end of 2020). Thus, at mid-year, the Group’s net financial debt, excluding rental debt (IFRS 16) amounts to â¬ 21.1 million, i.e. 22% of shareholders’ equity (â¬ 98.3 million) and 1.8x EBITDA of the last 12 months.
In addition, the Group does not use factoring and therefore has financing reserves of more than 10 million euros.
CONFIRMATION OF TARGETS FOR 2021
After this positive start to the year, SQLI aims to generate growth in its consolidated turnover over the year as a whole and to improve its annual consolidated operating margin by 2 points (3.4% in 2020).
PURCHASE OFFER PROJECT
DBAY Advisors, SQLI reference shareholder since December 2021 (with 28.6% of the capital), announced its intention to acquire all SQLI shares through a public tender offer at â¬ 30 per share. As such, SQLI and DBAY Advisors have concluded an agreement (Tender Offer Agreement) defining the terms of this operation (see press release published today).
SQLI will announce its turnover for the third quarter of 2021 on October 26, 2021 after market close.
(1) EBITDA = earnings before interest, taxes and depreciation (excluding IFRS 16).