- +8.5% organic growth (excluding MLS - training activity), accelerating in H2 (+10%)
- Net income doubled to +2.3 million euros
Micropole, an international consulting and innovative technology group specializing in Data & Digital Experience, announces that it has achieved revenues of €115.3 million for the full year 2019, compared with €109.3 million for the same period last year. On a like-for-like basis (excluding MLS - training activity), growth was 8.5% for the full year, with the second half of 2019 marking a notable acceleration in the pace of business growth (+10%) and profitability growth, despite continued pressure on resources.
The company presents its audited 2019 annual accounts, approved by the Board of Directors on April 21, 2020. These accounts have been restated to take into account the sale on February 17, 2020 of the Micropole Learning Solutions (MLS) subsidiary dedicated to training. Thus, the MLS activity, which represented 3.4 million euros over the period, has been treated as a sold or discontinued activity in the consolidated accounts as of December 31, 2019.
| In millions of euros - IFRS (Under audit) | 2019* | 2018* | 2018Published |
| Sales figures | 115,3 | 106,0 | 109,3 |
| Current operating income | 6,0 | 4,5 | 4,6 |
| As a % of sales | 5,2% | 4,2% | 4,2% |
| Non-operating income and expenses | (1,6) | (1,5) | (1,6) |
| Operating income | 4,4 | 2,9 | 3,0 |
| As a % of sales | 3,8% | 2,7% | 2,7% |
| Net income | 2,3 | 1,1 | 1,1 |
*Retired from the MLS sale on February 17, 2020
Income from operations before non-recurring items rose sharply (+30%) to 6 million euro. This increase is mainly due to :
- An increase in price positioning, linked to good recognition in its markets of the added value provided by the Group's offerings (in France: ARPU +5.5%).
- To the restructuring efforts initiated in 2017 and continued this year with the sale of the MLS business.
- Economies of scale generated by sustained revenue growth, enabling the Group to better absorb structural costs.
On a like-for-like basis, recurring operating income improved by 4.2% to 5.6%. In Europe (Group excluding China), operating income recurring was 6% versus 4.5% in 2018.
Operating profit increased by 46% to 4.4 million Euro, despite restructuring costs remaining at the same level as the previous year.
This good annual performance, which accelerated significantly in the second half of the year, particularly in Europe, reflects :
- The good positioning of the Group, which offers high value-added digital and data transformation solutions, at the forefront of its markets.
- The industrialization of cloud offerings set up in partnership with Amazon AWS, Microsoft Azure and Salesforce, in particular for data-related projects. This global and innovative vision, both in terms of methodology and architecture, ensures that Micropole is a leader in these solutions, whose share of revenue has grown strongly. The Go Cloud & Security offer, launched in mid-2019, also completes this offering.
- Ongoing innovation by the Group's R&D teams around technologies that anticipate future customer challenges. Investments in 2019 focused in particular on AI (machine learning and deep learning, predictive or behavioral analysis, fraud detection, RPA, etc.), IoT (industrial lifecycle optimization, predictive maintenance, digital twin management, etc.), the many issues encountered in the fields of data and digital in complex environments, as well as blockchain (transmission and security of data in an IS).
- Continuous improvement and optimization of internal processes, both in the commercial and operational areas and in the management of our human resources.
Net income, Group share, was positive at 2.3 million euros, more than double the previous year's figure.
This strong improvement in results is also reflected in cash flow, since at December 31, 2019, cash flow amounted to €16.3 million with net financial debt, excluding lease liabilities, of €9.5 million (compared with €12.3 million at December 31, 2018), for shareholders' equity of €52.2 million. It should be noted that 2019 is the first year of application of IFRS16, which leads to the restatement of real estate and equipment leases as fixed assets (item rights of use) and liabilities (item short-term rental liabilities and long-term rental liabilities).
Progression of activities
The good momentum of the Micropole Group's activities was mainly driven by :
- The two business units in Paris operating the offerings around Data and Digital which grew over 2019 by 8.8% and 9% respectively.
- The entity in Belgium, which will grow by 18.4% in 2019 and which benefits from strong customer demand for cloud offerings, and in particular for Advanced Analytics platforms, for which the Belgian teams are the forerunners for the Group.
Business in the French Regions and in Switzerland (excluding the currency effect) remained relatively stable over the period, marked by reorganizations at management and sales team level. Lastly, China, which experienced a sharp decline in activity (-40%), has become insignificant in terms of Group figures (less than 0.5% of Group revenues). The agency is focusing on maintaining its support activity for our European clients.
Recruiting
In terms of our human resources, 2019 was marked by a positive dynamic due both to strong recruitment activity (more than 350 new hires in the Group) but also to a significant drop in turnover in France, resulting from numerous actions carried out by the Human Resources department to improve the employer brand and retain talent. The Group also renewed its Happy At Work and Happy Trainees certifications in 2019 and obtained the Agile At Work label for the first time. This positive momentum accelerated in the second half of the year and means that Micropole's on-boarding headcount for 2020 is well above the previous year (+5.2%).
Perspectives and COVID-19 update
The COVID-19 pandemic and the confinement of Europe in March 2020 have affected the global economy and consequently the Group's activity. All employees have switched to teleworking without difficulty and great care has been taken in managing human resources.
As early as March, a decline in sales compared to the 2020 objectives was noted and this could reach 20% in April and May 2020. The duration and extent of this situation cannot be predicted. In this context, the Group has implemented measures of partial activity and various governmental aid schemes in the countries concerned (including the State Guaranteed Loan in France), intended to preserve companies and ensure a recovery in the best conditions at the end of this international crisis
In view of the very good performance in 2019, the TARGET 21 plan was well on its way to success before the impact of the global health crisis. In this period of uncertainty, Micropole is maintaining its medium-term ambitions, particularly in terms of profitability, but is not communicating any quantified objectives for 2020.
Next financial meeting on Thursday, May 14, 2020
for the publication ofQ1 2020 revenues
