Financial Releases

 Revenue

 

Over the first half of 2011, StreamWIDE recorded a €0.2M increase in revenue, with all of the Group’s key revenue segments seeing growth. Excluding third-party sales, revenue was up €0.7M, i.e. an increase of 16% compared to the first half of 2010.

 

License and Maintenance revenue (recurrent by their very nature) together rose by 11.3%, driven by the development of installed bases and major orders from French clients. Services recorded revenue of €0.7M over the first half of 2011, which notably came from system setups and updating operations on some installed bases.

 

Revenue recorded in France was up 28% (+€0.5M), whilst Export revenue was down 11% (-€0.3M) following a different seasonal effect in 2011 and a difficult international context, notably in North African and Middle Eastern countries, resulting in project delays.

 

 Results

 

At June 30, 2011, operating profit was a positive €1.3M, versus €1.0M at June 30, 2010. This substantial increase (+31%) reflects the Group’s ability to implement considerable leverage on its profitability, thanks to a tight control over operating costs. Down slightly over the first half of 2011, these costs totaled €4.0M.  These results translate into a Group operating margin of 23.8%, compared to 19.0% for the first half of 2010, illustrating the incremental profitability achieved by StreamWIDE over the first half of 2011.

 

StreamWIDE pursued its dynamic Research & Development investment policy during the first half of 2011. The development costs capitalized over the half totaled €1.3M in gross terms and €1.0M in net terms, a similar figure to the first half of 2010.

 

There was a financial loss of €0.2M over the half, versus a profit of €0.3M over the first half of 2010. This substantial variation was notably a result of the negative evolution of the USD/EUR parity over the period. Excluding translation adjustments, the net loss on currency exchange was €0.1M over the half, compared to a gain of €0.1M a year earlier.

 

Lastly, taxes caused a greater negative impact on results in the first half of 2011, following the deduction of the Group’s positive tax results on loss carryforwards and recurrent passive deferred effects (capitalization of development costs) on one hand, and the capitalization at June 30, 2010 of the US subsidiary’s deficit (€0.5M), non recurrent at June 30, 2011, on the other. 

 

Despite the substantial increase in operating profit (+€0.3M to €1.3M), net profit (+€0.7M) was down compared to the first half of 2010, due to the combined effect of a financial loss and higher tax.

  

 

At June 30, 2011, the total balance sheet stood at €16.5M, versus €14.3M at December 31, 2010, notably due to the capitalization of the Group’s development costs and related deferred tax income (research tax credit). 

 

The Group again had no debt over the period. Moreover, the first dividend was distributed in July 2011, for 2010 results, and was 0.19 Euros per share.

  

 

The Group’s participation in the 2011 MWC (Mobile World Congress) trade fair in Barcelona enabled it to validate its innovation strategy. The success recorded by new products such as SGC (StreamWIDE Global Communications) enables it to foresee new short and medium-term growth opportunities.

 

Visibility in terms of orders and revenue is satisfactory, and has improved since the start of the year. The Group is confident regarding the 2011 annual trend, despite a global economic context that warrants a certain amount of caution.

 

The different sales channels (direct and indirect) allow the Group to better manage the various sales opportunities whatever the geographical zone concerned. The new organization instigated since the start of 2011 should result in a positive evolution for revenue in coming months.

 

If the growth observed over the first half of 2011 continues through the fourth quarter of 2011, annual profit and the annual operating margin should continue to improve. However, the amortization of previously-capitalized development costs should have a greater impact on results than they did in previous years.