Sopra Steria Group: Q1 2024 in Line With Forecasts
- R evenue for Q1 2024 came to €1,587.4 million, equating to total growth of 13.8%
- Organic growth1 came to 0.3%, in line with the guidance issued at the end of February: “Q1 relatively stable”
- Targets confirmed for organic growth, operating margin rate and free cash flow for financial year 2024
|
||||
€m / % | Q1 2024 | Q1 2023 |
Organic growth |
Total growth |
Revenue |
1,587.4 |
1,395.4 |
0.3% |
13.8% |
Cyril Malargé, Chief Executive Officer of
“In the first quarter of 2024, in a market that remained buoyant for large-scale digital transformation projects but substantially less dynamic for discretionary investments,
Our priorities for 2024 are confirmed: successfully integrate the companies we acquired in 2023; execute the plan to dispose of our banking software activities by the end of Q2, or during Q3 at the latest; make progress on our internal transformation initiatives; and, finally, boost the Group’s financial performance.
In Q1, we also stepped up our investments in the rAIse programme to embrace generative artificial intelligence. Sopra Steria Next, our consulting entity, forged two major strategic partnerships, launching a collaboration with Microsoft to assist businesses in their implementation of Microsoft 365 Copilot and joining the NVIDIA AI Consulting Partner Network. These initiatives reinforce Sopra Steria’s leadership position in artificial intelligence and give our customers access to the very best these cutting-edge technologies have to offer.”
Comments on Q1 2024 business activity
Revenue came to €1,587.4 million, equating to total growth of 13.8% relative to Q1 2023. This growth included the positive impact of changes in scope of €184.1 million arising from the consolidation of
In an environment marked by a slowdown in discretionary investments in technology, a high basis of comparison (9.1% growth in Q1 2023) and an unfavourable calendar effect (1 fewer day), organic growth held up well, equating to slight growth (0.3%). The most resilient sectors were the public sector, financial services and defence.
The
The
The Other
Revenue for
The Other Solutions reporting unit (4% of the Group total) posted revenue of €71.2 million, representing organic growth of 0.8%. The Human Resources Solutions business (which generates 70% of the reporting unit’s revenue) grew by 3.7%. Property Management Solutions contracted by 5.3%, in line with forecasts.
Changes in scope
Consequently,
Workforce
At
The workforce attrition rate was 14.0% (compared with 16.0% in Q1 2023).
Recap of targets for 2024
- Organic revenue growth of between 2% and 4%
- Operating margin on business activity of between 9.5% and 10%
- Free cash flow of at least €350 million
Q1 2024 revenue presentation meeting
Revenue for the first quarter of 2024 will be presented to financial analysts and investors via a bilingual (French and English) conference call to be held on
- French-language phone number: +33 (0)1 70 37 71 66
- English-language phone number: +44 (0)33 0551 0200
Practical information about this conference call can be found in the ‘Investors’ section of the Group’s website: https://www.soprasteria.com/investors
Upcoming financial releases
Tuesday,
Wednesday,
Thursday,
Glossary
- Restated revenue : Revenue for the prior year, expressed on the basis of the scope and exchange rates for the current year.
- Organic revenue growth : Increase in revenue between the period under review and restated revenue for the same period in the prior financial year.
- EBITDA : This measure, as defined in the Universal Registration Document, is equal to consolidated operating profit on business activity after adding back depreciation, amortisation and provisions included in operating profit on business activity.
- Free cash flow : Net cash from operating activities; less investments (net of disposals) in property, plant and equipment, and intangible assets; less lease payments; less net interest paid; and less additional contributions to address any deficits in defined-benefit pension plans.
- Operating profit on business activity : This measure, as defined in the Universal Registration Document, is equal to profit from recurring operations adjusted to exclude the share-based payment expense for stock options and free shares and charges to amortisation of allocated intangible assets.
- Profit from recurring operations : Operating profit before other operating income and expenses, which includes any particularly significant items of operating income and expense that are unusual, abnormal, infrequent or not foreseeable, presented separately in order to give a clearer picture of performance based on ordinary activities.
- Basic recurring earnings per share : This measure is equal to basic earnings per share before other operating income and expenses net of tax.
- Return on capital employed (RoCE) : (Profit from recurring operations after tax + Profit from equity-accounted companies) / (Equity + Net financial debt).
- Downtime :Number of days between two contracts (excluding training, sick leave, other leave and pre-sales) divided by the total number of business days.
Disclaimer
This document contains forward-looking information subject to certain risks and uncertainties that may affect the Group’s future growth and financial results. Readers are reminded that licence agreements, which often represent investments for clients, are signed in greater numbers in the second half of the year, with varying impacts on end-of-year performance. Actual outcomes and results may differ from those described in this document due to operational risks and uncertainties. More detailed information on the potential risks that may affect the Group’s financial results can be found in the 2023 Universal Registration Document filed with the Autorité des Marchés Financiers (AMF) on
About
The world is how we shape it.
For more information, visit us at www.soprasteria.com
________________
1 Alternative performance measures are defined in the glossary at the end of this document.
Annexes
|
|||
€m | Q1 2024 | Q1 2023 | Growth |
Revenue |
1,587.4 |
1,395.4 |
+13.8% |
Changes in exchange rates |
3.1 |
||
Revenue at constant exchange rates |
1,587.4 |
1,398.5 |
+13.5% |
Changes in scope |
184.1 |
||
Revenue at constant scope and exchange rates |
1,587.4 |
1,582.6 |
+0.3% |
|
|||
For €1 / % |
Average rate
|
Average rate
|
Change |
Pound sterling |
0.8563 |
0.8831 |
+3.1% |
Norwegian krone |
11.4159 |
10.9901 |
-3.7% |
Swedish krona |
11.2792 |
11.2030 |
-0.7% |
Danish krone |
7.4563 |
7.4429 |
-0.2% |
Swiss franc |
0.9491 |
0.9925 |
+4.6% |
|
|||||
€m / %
|
Q1 2024 |
Q1 2023
Restated* |
Q1 2023 |
Organic growth |
Total
growth |
|
624.6 |
641.4 |
589.9 |
-2.6% |
+5.9% |
|
240.0 |
223.5 |
216.7 |
+7.4% |
+10.7% |
Other |
547.7 |
538.8 |
410.4 |
+1.7% |
+33.5% |
|
103.8 |
108.3 |
107.7 |
-4.1% |
-3.6% |
Solutions |
71.2 |
70.7 |
70.6 |
+0.8% |
+0.9% |
|
1,587.4 |
1,582.6 |
1,395.4 |
+0.30% |
+13.8% |
* Revenue at 2024 scope and exchange rates |
|
||
|
|
|
|
22,020 |
22,102 |
|
7,807 |
7,684 |
Other |
16,593 |
13,880 |
Rest of the World |
540 |
580 |
X-Shore |
9,313 |
9,478 |
Total |
56,273 |
53,724 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240425033593/en/
Investor Relations
Olivier Psaume
olivier.psaume@soprasteria.com
+33 (0)1 40 67 68 16
Press Relations
caroline.simon@image7.fr
+33 (0)1 53 70 74 65
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