Sword Group: Results for the Second Quarter of 2020 | Start of Negotiations with Argos with a View to Selling the Business Activities in France

RESULTS



SECOND QUARTER 2020



Consolidated Revenue: €55.0m



Consolidated Growth: + 2.6%



Organic Growth on a like-for-like basis: + 1.9%



Profitability (EBITDA margin): 14.4%

FIRST HALF OF 2020

Consolidated Revenue: €112.1m

Consolidated Growth: + 7.7%

Organic Growth on a like-for-like basis: + 6.0%

Profitability (EBITDA margin): 13.1%

ANALYSIS



The + 6% organic growth for the 1st half of 2020 at constant exchange rates on a likefor-like basis can be broken down as follows:



- Software: - 9.1%



- Services: + 7.9%



The Software division shows a decrease, mainly due to the postponement of licence revenue that was budgeted for the first half-year.



The Services division reacted to the crisis with different trends depending on the countries.



Two countries stood out in particular:



- BeLux (-0.4%) that did not show growth due to the Tipik subsidiary, in charge of the development of information systems linked to the organisation of events within the European Union.



- The UK (+ 18.9%) whose business activity was energised by the Oil market.



2020 OUTLOOK



Sword Group plans organic growth of 5%+ (versus 12% budgeted) associated with an EBITDA margin of 13% (no change in relation to the initial budget).



PROJECT TO SELL THE BUSINESS ACTIVITIES IN FRANCE



Argos Wityu and Sword Group have entered into negotiations with a view to the acquisition by Argos Wityu of the French business activities of Sword Group.



The perimeter concerned by the operation envisaged includes:



- The Services business activities currently managed by the French subsidiaries in France,



- The international Software activities with the National Trademark and Patent Offices.



This perimeter, the profitability of which is in line with the Group standards, generates a revenue trend of €60 million for 2020.



Argos Wityu is a European Fund whose investment strategy favours company growth, and who invests in particulier in the new technologies sector. While preserving the assets and expertise developed by the Group in France, Argos Wityu and the current management team of Sword France have an ambitious development project.



Sword Group will focus on:



- In France, the Software activities generally speaking,



- In the GRC sector (Risk Management and Compliance), acquisitions that provide products that are complementary to those already managed by this division,



- In the UK, Services through aggressive mainly organic growth but also supported by targeted acquisitions,



- In the other countries, the pursuit of its organic growth accompanied by potential acquisitions.



[The operation remains subject to information and consultation of the staff representatives and to approval of the anti-trust authorities.]

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