At its meeting on 30 May 2011, Solucom's Supervisory Board approved the consolidated annual financial statements at 31 March 2011, summarised below. The audit has been completed and the audit report is being prepared by the auditors.
|Consolidated data at 31st March
|Current operating margin||11.7%||9.7%|
|Operating income||12.6||7.0*||+ 80%|
|Group's share of net profit||6.9||3.3*||+ 113%|
* After goodwill amortisation of ¤3.0m
At the end of the 2010/11 financial year Solucom had achieved consolidated turnover of ¤108.0m, representing organic growth of 4% on 2009/10.
The past year was characterised by a clear improvement in the market for IT services, especially the consulting segment. Solucom was able to take advantage of this situation by rebalancing its sales portfolio, with a scaling down of its leading client and a strengthening of its activity in the finance sector.
Activity rate 85%, up 5 points
The development of operating indicators is also a reflection of a more buoyant market situation. The activity rate was sharply up at 85% in 2010/11, as compared with 80% in the previous financial year. Sales prices, after a continuous drop in the first half, rose in the second half. They remained virtually stable for the period at ¤713 as compared with ¤717 the year before.
On the other hand, the market recovery was marked by real tension in human resources. The relative inertia of the firm's new recruitment drive, and the increase in staff turnover (20% across the period), led to a drop in staff to 915 employees at 31 March 2011, as against 978 a year earlier.
To remedy this situation, Solucom speeded up its human resource actions in the second half-year, while providing a new push to its salaries policy for the coming financial year. The effects of the initiatives taken ought to bear fruit gradually during the 2011/12 financial year.
Annual results in line with targets
The improvement in the operating indicators has facilitated financing accelerated spending on human resources, communication, and preparations for future growth, representing more than 2 points of turnover. It has also fed an increase in the current operating margin, which was 11.7%, as compared with 9.7% a year earlier. Solucom's EBIT was ¤12.6m, up 25% on 2009/10.
It is recalled that this figure takes into account the reclassification for tax purposes on income of part of the Contribution Économique Territoriale local tax, which replaces the previous Professional Tax. This reclassification represents one point of improvement in current operating margin between 2009/10 and 2010/11.
Without any additional operating income or expenses, operating income came to ¤12.6m, up 80%. It is recalled that in 2009/10 Solucom amortised goodwill by ¤3.0m.
The Group's share of net income was ¤6.9m, up 113% on 20/2010.
An even more powerful strike force with a net cash position of ¤9.5m
As at 31 March 2011 Solucom's shareholder equity stood at ¤40.0m. With an operating cash flow of almost ¤10.0m, the firm has seen its cash flow increase sharply during the period, to end at ¤9.5m at 31 March 2011, as compared with ¤2.0m a year previously.
Solucom shall be proposing to the Shareholders' General Meeting to be held on 28 September 2011 the payment of a dividend for the 2010/11 financial year of ¤0.21 per share, up 11% on last year, and representing a distribution of 15% of the Group's share of net income.
"Solucom 2015", a new ambition for Solucom
Between 2000 and 2010 Solucom has grown considerably, which has allowed it to achieve its strategic objective, to take 5th place in the French market for IT consulting.
2011 marks the start of a new cycle for the firm, in a market which itself is entering a new growth phase.
Growth that is fed by an increasingly urgent need for major companies and organisations to upgrade: to innovate, to become more competitive, to develop in new markets, and to meet new competitive and regulatory challenges. The IT system has taken uncontested centre stage in these changes, ever since it has invaded every process in companies, including their core businesses.
Solucom is convinced that this pressing need for change and upgrade and the key role played by IT will lead to a realignment of the IT consulting market. The historical frontier between management consulting and IT consulting is going to disappear. And the ability to closely combine the two spheres of know-how, business and technology, will become the essential key for making the changes succeed.
The "Solucom 2015" strategic plan is based upon that belief. Solucom intends to be at the forefront of this inevitable reorganisation of the consulting market.
Through its strategic plan Solucom's ambition is to become the No.1 independent consulting firm in France.
Turnover of ¤170m - ¤200m by 2015
"Solucom 2015" breaks down into 3 key strategic parts:Gain leading positions among the largest business clients; Go beyond borders in order to provide enhanced support for the firm's international clients; Go beyond a new milestone in terms of size, to have sales turnover of ¤170m to ¤200m by 2015.
The 2011/12 financial year will be the first stage of this plan.
The major challenges of the period will be to restart sustained growth of staff, recommence an active external growth policy, obtain new positions among business managements and make the first steps to grow abroad.
The 2011/12 targets translate these challenges while taking into account the drop in staff as at 31 March 2011, which will weigh upon the first two quarters and will put a brake on the firm's growth during the year.
Solucom has set itself the target for 2011/12 to achieve turnover, on the same scope of consolidation, of between ¤100m and ¤115m, and to make at least one targeted acquisition during the year.
In terms of profitability, the firm is targeting an operating margin prior to any acquisition of 10% - 12%, including the first strategic investments of the "Solucom 2015" plan.
Upcoming dates: Q1 2011/12 turnover, on 20 July 2011 (after closing).
Solucom is a management and IS consulting firm.
Solucom's customers are among the top 200 large companies and public bodies. To them, Solucom is capable of mobilising and combining the skills and expertise of nearly 1,000 staff members.
Its mission? To place innovation at the heart of business lines, target and steer transformations that are sources of added value, and turn the information system into an actual asset designed to serve corporate strategies.
Solucom is listed on NYSE Euronext.
Solucom has been granted the innovative company label by OSEO.
All of our financial information is published on : www.solucom.fr
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