Sopra Steria Group Sa · EURONEXT:SOP
Sopra Steria Group Sa — Non-Deal Roadshow (November 2022)
33 slides from Sopra Steria Group Sa's roadshow presentation, November 2022
Slide 1: Roadshow USA & Canada
Roadshow USA & Canada NOVEMBER & DECEMBER 2022
Slide 2: Disclaimer
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
Slide 3: Agenda
AGENDA 01 Company overview 02 Financial performance & objectives for 2022 03 Recent acquisitions announcements 04 Annexes 3 November & December 2022 – Roadshow USA & Canada
Slide 4: Company overview
01 Company overview 4 November & December 2022 – Roadshow USA & Canada
Slide 5: Sopra Steria, a European leader in digital transformation
Sopra Steria, a European leader in digital transformation Breakdown of revenue – year ended 31 December 2021 Top 5 European digital services companies Top 12 operating in Europe 2021 revenue >47,000 Operations in End-to-end approach of €4.7bn employees 30 countries End-to-end 2% 15% 10% 3% 24% 5% 31
Slide 6: Resilient profile
Resilient profile Thanks to the nature of the Group’s client portfolio and business lines Update at 30/06/2022 Client focus on key strategic accounts 100 11% clients 3% 22% 5% Recurring revenue 4% BPO, IT Infrastructure Management, 5% Application Maintenance, Software Maintenance 40% 6% 19% 25% Reve
Slide 7: A core shareholder backing the corporate plan
A core shareholder backing the corporate plan Ownership structure at 31 December 2021 Pasquier Odin Treasury Managers family family shares 2.7% 68.3% 28.3% 0.7% Founders & Management Sopra GMT Shares managed on behalf Treasury shares Free float 2.6% 19.6% of employees Shareholders’ 5.8% 0.4% 71.5% a
Slide 8: Sopra Steria historical performance
Sopra Steria historical performance Historical average: revenue organic growth +6% ; operating margin 8.7% 4683 4434 4263 4095 3845 3741 3584 3370 Revenue (€m) Operating profit on business activity (€m) 1349 1216 1050 964 958 912 856 781 672 556 37 47 63 76 82 65 86 93 110 109 231 246 301 329 308 35
Slide 9: Sopra Steria historical net profit and dividend
Sopra Steria historical net profit and dividend Historical average DPS / EPS = 30% 3,5 3,2 185 Net profit attributable to Axway (€m) 3,0 Net profit attributable to the Group (€m) 2,4 2,2 2,5 135 1,9 2,0 1,9 1,9 1,9 2,0 Notes : 1,7 1,7 1,7 1,7 (1) Axway spin off 8 June 2011, Sopra Group AGM approved
Slide 10: Medium-term ambitions
Medium-term ambitions Financial targets Conseil Operating performance - 2022 / 2024 Services External financiers growth Revenue organic growth +4% to +6% pa Operating margin rate on business activity ~ 10% in 2024 Proactively pursuing consolidation Free cash flow 5% to 7% of rev. 10 November & Decem
Slide 11: Medium-term ambitions
Medium-term ambitions ESG objectives Net-zero emissions Women to make up 30% of Digital sustainability in our by 2028 Executive Committee by 2025 value proposition Cut GHG (1) emissions from A proactive policy of bringing Digital sobriety direct activities, approved by more women into the Measuring
Slide 12: Financial performance & objectives for 2022
02 Financial performance & objectives for 2022 12 November & December 2022 – Roadshow USA & Canada
Slide 13: Strong, steady market dynamics in H1
Strong, steady market dynamics in H1 Solid growth fundamentals Organic revenue growth Average Value (Group) enhancement organic growth +8.1% 2004 – 2021 +6% +6.4% +6.5% Structural growth market Cloud Digitisation of processes FY 2021 Q1 2022 Q2 2022 Cybersecurity 13 November & December 2022 – Roadsh
Slide 14: Improved operating performance in H1
Improved operating performance in H1 Operating margin up 0.8 pts and free cash flow of €66m Operating margin on business activity (%) Free cash flow (€m) 8.0% H1 2018 H1 2019 H1 2020 H1 2021 H1 2022 61.9 66.3 7.2% 37.1 6.8% 6.6% -21.8 6.1% H1 2018 H1 2019 H1 2020 H1 2021 H1 2022 -114.3 14 November &
Slide 15: Operating performance by reporting unit in H1
Operating performance by reporting unit in H1 Operating profit on business Revenue activity H1 2021 Organic H1 2022 H1 2022 H1 2021 Restated* growth (€m) (% of Rev.) (% of Rev.) (€m) (%) France 1,023.7 932.0 + 9.8% 9.7% 8.3% United Kingdom 442.6 421.4 + 5.0% 10.5% 8.7% Other Europe 731.3 676.2 0 + 8
Slide 16: Revenue growth by reporting unit in Q3
Revenue growth by reporting unit in Q3 Revenue Q3 2021 Organic Total Q3 2022 Restated* growth growth (€m) (€m) (%) (%) France 477,9 435,5 + 9,7% + 11,8% United Kingdom 228,9 213,0 + 7,4% + 7,3% Other Europe 348,7 317,1 + 10,0% + 12,0% Sopra Banking Software 98,5 105,3 - 6,5% - 6,0% Other Solutions 6
Slide 17: Strengthened balance sheet structure
Strengthened balance sheet structure 30/06/22 30/06/21 Net financial debt 12% 15% Gearing Gearing 15% 11% Net financial debt / 18% 26% Lease liabilities Equity 3% 4% 3% 11% Leverage Leverage Provisions for Net financial debt / EBITDA(1) 0.75x 1.01x contingencies and losses Pensions – Post- 66% Pensi
Slide 18: Confirmation of 2022 targets
Confirmation of 2022 targets Organic revenue growth target revised upward: now around 7% (vs 5% to 6% previously) Operating margin on business activity of between 8.5% and 9.0% Free cash flow of around €250m 18 November & December 2022 – Roadshow USA & Canada
Slide 19: Recent acquisitions announcements
03 Recent acquisitions announcements 19 November & December 2022 – Roadshow USA & Canada
Slide 20: Proposed acquisition of CS GROUP
Proposed acquisition of CS GROUP A leader in mission-critical systems – Accelerated commercial momentum 2021 revenue: €237.4m Main clients Order intake: €487.2m in 2021 13% organic growth 2022 revenue (est.): Two major programmes spanning more €258.7m(1) than 10 years with France’s defence procureme
Slide 21: A strategic, value-creating transaction
A strategic, value-creating transaction A benchmark player in the critical defence & security, space and energy markets Benchmark player in critical sectors: Defence & Security/Space/Energy o ~€600m in revenue from defence & security on a 2021 basis o Strategic relations with major defence industr
Slide 22: Key components of the terms of the tie-up with CS GROUP
Key components of the terms of the tie-up with CS GROUP Proposed acquisition of controlling interests followed by a simplified public offer Block purchase price: Equity value (100%): Resulting premiums(3): €11.5 per share €282.5m(1) Share ownership structure VWAP 1 month: +74.7% (at 27 July 2022) KE
Slide 23: Other acquisitions announced in November 2022
Other acquisitions announced in November 2022 Strengthen CS GROUP’s position in the European Reinforce our strategic countries and establish a space sector (#3) leading position in the Belgian digital services market Space engineering specialist Digital consultancy and services company manpower serv
Slide 24: Annexes
04 Annexes 24 November & December 2022 – Roadshow USA & Canada
Slide 25: Income statement
Income statement Financial year 2021 2021 2021 2020 2020 (€m) (% of Rev.) (€m) (% of Rev.) Revenue 4,682.8 4,262.9 Organic growth 6.4% Operating profit on business activity 379.2 8.1% 300.2 7.0% Share-based payment expenses - 6.7 - 4.2 Amortisation of allocated intangible assets - 33.2 - 34.8 Profit
Slide 26: Other operating income and expenses
Other operating income and expenses Financial year 2021 2021 2020 (€m) (€m) Costs related to business combination - 0.6 - 3.1 Restructuring and reorganisation costs - 35.5 - 44.6 Other 0.2 - 11.1 Other operating income and expenses - 35.8 - 58.9 Including €15.6m Covid-related costs 26 November & Dec
Slide 27: Tax
Tax Financial year 2021 2021 2020 (€m) (€m) Profit before tax and share from equity-accounted companies 285.2 177.1 Effective tax charge -93.5 -60.4 Effective tax rate (%) 32.8% 34.1% Includes the impact on deferred tax of the increased tax rate in the UK (19% -> 25%) Normative tax rate estimated at
Slide 28: Earnings per share
Earnings per share Financial year 2021 2021 2020 (€m) (€m) Net profit attributable to the Group (€m) 187.7 106.8 Weighted average number of shares in issue excluding treasury shares 20.24 20.25 Basic earnings per share (€) 9.27 5.27 Basic recurring earnings per share (€) 10.45 7.42 Theoretical weigh
Slide 29: Breakdown of change in net financial debt
Breakdown of change in net financial debt Financial year 2021 2021 2020 (€m) (€m) Operating profit on business activity 379.2 300.2 Depreciation, amortisation and provisions (excluding allocated intangible assets) 173.2 187.4 EBITDA 552.3 487.6 Non-cash items - 0.9 6.7 Tax paid -77.3 -82.9 Change in
Slide 30: Global workforce
Global workforce Q3 2022 30/09/2022 30/09/2021 France 19 775 19 662 United Kingdom 7 278 6 750 Other Europe 12 142 11 257 Rest of the World 455 463 X-Shore 9 761 8 667 Total 49 411 46 799 30 November & December 2022 – Roadshow USA & Canada
Slide 31: Contributing to the fight against climate change
Contributing to the fight against climate change Plan to reduce our greenhouse gas (GHG) emissions – 2021 results Direct activities Energy management Sites, business travel, Mobility policy -50%1 per employee -85%2 per employee by Digitisation (baseline: 2015) 2040 (baseline: 2015) data centres Offs
Slide 32: Commitment to net-zero emissions by 2028
Commitment to net-zero emissions by 2028 Our trajectory toward achieving net-zero emissions by 2028 Net-zero emissions of the supply of the supply chain + Waste, chain commuting and remote working + Business travel Offices, data centres Direct activities Indirect activities 32 November & December 20
Slide 33: Alternative performance measures
Alternative performance measures 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