GROUPE STERIA : 2006 annual results. Operating margin: 7.1%. Attributable net profit increased by 41.9%

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  • 2006 annual revenue: ¤1.262 billion, increased by 7.4%, on a like-for-like basis
  • 2006 operating margin: ¤89.6 million, up 36.8% compared with 2005, representing a margin rate of 7.1% (vs. 5.6% in 2005)
  • Attributable net profit: ¤54.3 million, an increase of 41.9%
  • Diluted EPS1: ¤2.87, up 39.3%
  • Proposed dividend2: ¤0.42 per share (vs. 0.30 in 2005), an increase of 40%

On the 28th February 2007, the Groupe Steria SCA supervisory board examined the consolidated accounts submitted by the General Management.

2006 annual results

  2005 2006 Variation 
Revenue ¤ m 1174.9 1262.0 +7.4%
Operating margin1
As a % of revenue
¤ m
%
65.5
5.6%
89.6
7.1%
+36.8%
+1.5 pt
Operating income4 ¤ m 45.5 81.1 +78.2%
Attributable net profit ¤ m 38.3 54.3 +41.9%
Diluted earnings per share ¤ 2.06 2.87 +39.3%
Average weighted diluted number of shares Mn. 18.62 18.96 +1.8%
Net financial debt ¤ m 38.3 -0.8 -

In 2006, the Steria Group substantially improved its operating profitability. Its operating margin increased by 36.8% to ¤89.6 million. This took the operating margin rate to 7.1%, an increase of 1.5 points compared with one year ago.

In France, the operating margin rate improved by 0.6 points compared with 2005 reaching 9.3% before group costs. In the UK, the operating margin rate progressed by 0.8 points to 9.6% before group costs. In Germany, the operating margin rate before group costs rose sharply to 7.9%, up from 5.2% in 2005 on the back of a considerable improvement in profitability in the second half of 2006 (operating margin rate before group costs of 9.2% in the second half of 2006 compared with 4% in the second half of 2005). In the Other European countries zone, the operating margin rate was up 1.9 points to 4.2% before group costs.

In terms of business lines, the Steria Group has maintained a high operating margin in Outsourcing (with a margin rate of 9.5% before group costs vs. 9.6% in 2005) and has improved its operating margin by 2.3 points to 7.2% in Consulting and Systems Integration.

Key events in 2006

  • The Group enjoyed sustained activity in 2006. This dynamism was reflected in a like-for-like revenue growth rate of 10.2% in our three principal geographical regions, a 11.5% rise in consolidated orders at 31 December 2006 relative to 31 December 2005, and a steady pace of recruitment throughout the year, taking our total headcount at end-2006 to 10 484, an increase of 1,195 employees in the year.
  • Operating free cash flows5 increased significantly in the course of 2006 (up 48.7% to ¤33.9 million), giving a positive net cash situation at the year-end.
  • Group operating margin increased to 7.1%, puttingthe Group in line with the most profitable players in the European sector and fulfilling the undertaking given in 2002 following the acquisition of Integris.
  • The industrialisation process has been stepped up via the creation of an Industrial Operations management team that brings together within a Global Delivery Unit all of our data centres, our third-party application maintenance centres, and our helpdesk and call centres, and the launch of Global Sourcing and Global Service Centre projects.
  • The Group put in place an innovative, new governance model designed to strengthen its appeal and the motivation of its employees in order to create a competitive advantage regarding the level of service provided to clients. On this occasion, the Extraordinary General Meeting of Shareholders nominated on the 1st February 2007, François Enaud General Partner of Group Steria SCA. Jacques Bentz was elected as Chairman of the Supervisory Board in replacement of Eric Hayat who was elected as Vice Chairman. Moreover, Jean Carteron was nominated honorary Chairman of Groupe Steria SCA.

Outlook

The Book to Bill6 ratio of 1.1 as at 31 December 2006 gives grounds to anticipate a further year of revenue growth in 2007.
Given the initiatives it has introduced, the Group has a number of growth levers that should improve profitability in 2007.

Next publication: first-quarter 2007 revenue:
Wednesday 2 May 2007 after the market close.

Enclosures (in PDF):

  • Consolidated income statement for the 2006 financial year
  • Balance sheet for the 2006 financial year
  • Simplified cash flow statement for the 2006 financial year
  • Interview of François Enaud, General Manager of Groupe Steria SCA, on www.steria.com

  1. Earnings per share
  2. Dividend which will be proposed by General Management to the General Meeting of Shareholders on 30 May 2007
  3. Operating margin is the Group's key indicator. It is defined as the difference between revenue and operating expenses, these being equal to the costs of services rendered (costs necessary for the implementation of projects), as well as Selling and General and Administrative costs.
  4. Operating profit includes additional expenses associated with stock options or bonus shares allocated to certain employees, restructuring expenses, capital gains on disposals, etc.
  5. Cash flow less change in WCR (Working Capital Requirement), less industrial investments net of disposals and less restructuring
  6. Orders taken in the year as a percentage of annual sales

Steria is listed on Euronext Paris, Eurolist (Compartment B)
ISIN: FR0000072910, Bloomberg Code: RIA FP, Reuters Code: TERI.PA
CAC MID&SMALL 190, CAC MID 100, CAC Soft&CS, CAC Technology
SBF 120 general index, SBF 250, SBF 80, IT CAC, NEXT 150
For further information, please visit our website: http://www.steria.com


Press Relations:
Isabelle GRANGE
Tel: +33 1 34 88 64 44 / +33 6 15 15 27 92
Isabelle.grange@steria.com
Investor Relations:
Olivier PSAUME
Tel: + 33 1 34 88 55 60 / + 33 6 17 64 29 39
olivier.psaume@steria.com
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