Results for the first six months of 2005
Bull announces revenue upturn and confirms its profitability
Bull's board of directors, headed by Chairman and Chief Executive Didier Lamouche, met on July 21 2005 to examine the financial statements for the first six months of 2005.
Paris, July 22, 2005 -
Bull announces revenue upturn for the first time since 1999 and exceeds its revenue objective
- EBIT1 : €18.2 million, in line with the objective
- Net income: €9.4 million
- The implementation of the 5-step 2005 action plan is already delivering noticeable results
- Backlog at the end of June 2005 increased by 19%
Didier Lamouche, Chairman and Chief Executive of the Bull Group, commented: "Thanks to an organization that is being driven by a clear operational plan of action, Bull has recorded its first six months of growth since 1999. We have thus exceeded the objectives >set at the beginning of the year. Bull has clearly bounced back. Our open and innovative technology positions us favorably for long-term growth."
Revenue upturn
Revenue , up 1%, reached €571.8 million, above the objective of €560 million. This is mainly due to a net increase in revenue from the Group's product business (+10%). This growth reflects the fact that Bull's offering in the field of leading edge technologies is increasingly relevant and competitive. The services business achieved a very similar level of revenue to last year (-0.6%) and, encouragingly, an increase of 4% was recorded compared to the second half of 2004. The evolution of the Group's maintenance activities (-11%) was in line with forecasts.
During the first six months, orders increased significantly (+11%), made up as follows: +16% in products and +4% in services, reflecting the Group's new business momentum.
As a result, the backlog at the end of June 2005 was up 19% compared to the end of June 2004.
Confirmation of operating profitability
Gross margin was in line with expectations (at 26.4% of revenue). R&D expenses were maintained at 4.8% of revenue. SG&A expenses were down by 3% compared to the same period last year, and accounted for 18.4% of revenue compared with 19.1% in the same period last year.
EBIT1 , which amounted to €18.2 million, or 3.2% of revenue, was in line with the objective announced in February this year.
Improvement in net profit
The Group continued to rationalize and the costs entailed were partly covered by non recurring items (most notably, the sale of Bull's equity stake in Steria). Operating income2, including non recurring items amounted to €13.7 million.
Thanks to the Group's sound financial footing, financial expenses for the period were reduced to 0.2% of revenue.
Net profit reached €9.4 million, compared with the €3.7 million achieved during the same period in 2004.
Reinforced financial structure
The Group continued to strengthen its financial structure during the first half of 2005. At the end of June 2005 net cash stood at 264 million compared with €237 million at the end of December 2004. Consolidated net equity grew to €80 million, compared with €65 million at the end of December 2004 (including IFRS impact).
Ongoing 2005 action plan
One of the main priorities of the first six months of 2005 was the development and implementation of an operational action plan for 2005, of which a number of steps have already been completed. In particular, a new top management team - bringing together both internal and external experience - has been constituted, and a new management system focused on operational efficiency has been established and is already delivering results.
The plan to improve the services business in France has been launched and is now entering its implementation phase. The recovery plan for the Group's Italian activities is underway and has already led to a significant increase in orders and revenue during the first half of 2005, in spite of a difficult local environment.
Outlook for 2005
In a market that remains cautious, particularly in Western Europe, Bull targets a higher revenue and EBIT objective in the second half of 2005 than that achieved in the first half of the year.
In millions of euros:
| |
First half 2005 |
First half 2004 |
Revenue |
571.8 |
565.7 |
Gross Margin |
150.9 |
158.7 |
R&D |
(27.2) |
(28.5) |
SG&A |
(105.3) |
(108.3) |
Exchange Gain/loss |
(0.1) |
(1.8) |
EBIT1 |
18.2 |
20.1 |
% of revenue |
3.2% |
3.6% |
Non recurring items |
(4.5) |
4.4 |
Operating income2 |
13.7 |
24.5 |
Financial Expenses |
(1.0) |
(16.1) |
Goodwill |
|
(3.5) |
Taxes |
(3.3) |
(1.2) |
Net income |
9.4 |
3.7 |
(2) Earnings before interest and taxes, including non recurring items
About Bull, Architect of an Open World
As one of the leading European IT companies, Bull delivers open, flexible and secure information systems. The group helps public and private sector customers transform their information systems, applying its know-how and expertise in three main areas:
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Capitalizing on its extensive mainframe experience, Bull designs and produces robust, innovative and open servers, based on industry-standard technologies;
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Building on its alliances with leading ISVs and long-standing involvement with Open Source, Bull develops and implements flexible and interoperable application infrastructures which give business processes the freedom to evolve;
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Bringing together recognized expertise in end-to-end IT security, Bull secures data and exchanges that are so critical in preserving customers' business integrity.
Bull has a particularly strong presence in the public, healthcare, finance, telecommunications, manufacturing and defense sectors. Its distribution network and business partners cover more than 100 countries worldwide.
For more information visit: http://www.bull.com
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