Groupe Open : Annual results 2016

Annual results 2016: Turnover: €305 million (+8%) COI: €21.5 million (+24%)

Net income, group share: €11.7 million (+32%)

Paris, 15 March 2017 - Groupe Open (ISIN: FR 0004050300; NextEconomy segment - 972, information technology services), a Digital Service Company, publishes its results for 2016.

Annual results 2016:

In € million	2016	2015	Growth
Turnover	304.7	282.3	+8%
Current Operating Income	21.5	17.3	+24%
% COI	7.1%	6.1%
Other operating income and expenditure	-1.2	-0.7
Operating income	20.3	16.6	+22%
Cost of net financial debt	-1.0	-1.0
Tax expenditure	-7.8	-6.3
Net income from continuing activities	11.5	9.3	+24%
Net income from activities discontinued, sold or in the process of being transferred	0.1	-0.5
Net income, group share:	11.7	8.8	+32%

Groupe Open has confirmed its financial performance in 2016 with very strong growth on all its indicators: a rise in turnover exceeding growth in the market (+8% of which 6% organic) and a significant improvement in its income (Current Operating Income up 24%, Net Income up 32%).

The productive workforce of Groupe Open is now 3,600, up 180 on 2015. Annual growth in turnover went hand-in-hand with stable operating indicators.

Breakdown of Turnover and Current Operating Income by country:

In € million	2016	2015	Growth
Turnover France	281.9	258.3	+9%
COI France	21.1	16.7	+26%

In € million	2016	2015	Growth
International turnover Belgium Netherlands Other	22.8 9.4 8.5 4.9	24.0 10.5 9.8 3.7	-5%
International COI	0.4	0.6

France turned in an excellent performance with 9% growth in turnover, of which over 7% organic.

Financial Situation 2016

BALANCE SHEET AND CASH FLOW

In € million	2016	2015
Goodwill	112.5	104.8
Intangible fixed assets	2.4	1.2
Non-current assets	124.4	114.1
Cash flow	30.8	26.3
Current assets	113.8	99.9
Total ASSETS	238.2	214.1

In € million	2016	2015
Shareholders' equity	113.8	106.6
Financial debt	20.0	10.3
Non-current liabilities	20.6	4.8
Current liabilities	103.8	102.3
Other financial liabilities	8.8	6.6
Total LIABILITIES	238.2	214.1

The financial structure was reinforced, with very good control over working capital requirement.

In January 2016, Groupe Open took out a financing package to refinance its bank debt and finance the acquisitions announced within the framework of its strategic plan.

The acquisitions of Lateos, MCO Finance and La Netscouade were financed in this way.

In € million	2016	2015
Net cash flow from operations	8.7	17.2
Net cash flow from investment	-8.2	-3.2
Net cash flow from financing operations	3.9	-4.5
Variation in net cash flow	4.4	9.5
Cash and cash equivalents at opening	24.8	15.3
Cash and cash equivalents at close	29.2	24.8

Cash flow generation in 2016:

• €8.7 million in net cash flow from operations, after an exceptional year in 2015, with good control over working capital requirement in light of the high growth levels

• net cash flow from investments includes investments relating to the new facilities and also flows linked to acquisitions

• net cash flow from financial operations includes more particularly the distribution of dividends (-€2 million), buybacks of treasury shares (-€2 million) and the refinancing of outstanding bank debt (+€8 million)

Groupe Open extends its reach

The Groupe Open value proposition to clear obstacles to successful digital transformation

For most companies, the need for digital transformation is no longer a question. The only crucial issue that remains is how to do it.

Groupe Open has put together a toolbox in three parts: FastLab® (Ideation and Prototyping), Digital Factory® (Industrialisation) and the "Fast-IT" Technology Platform. The objective is to address each of the obstacles to successful digital transformation one by one - governance, resistance to change, ROI - by getting all the different players involved from the beginning, producing the prototype and measuring the impact of product roll-out in order to shorten Time to Market.

In under 13 weeks, FastLab® enables the development of an (industrialisable) Minimum Viable Product (version 0). The programme brings project teams and digital experts together in a single innovation- conducive place equipped with the latest technologies and infrastructures, all backed by a tailored agile method.

2016, Year 1 in the roll-out of the Strategic Plan 2020

• A sound end-to-end offering in line with market expectations: a comprehensive set of services and skills to transform and optimise information systems throughout their life cycle, a range of digital expertise encompassing the whole value chain, and an offering of unique, innovative solutions and platforms.
• Opening of the StorebyOpen (www.openstore.global), the e-Commerce platform providing on-line access to the offering of services on demand, expertise and solutions and, in time, the possibility of monitoring and managing these services via a back office that is shared with clients.

• Implementation of a "Fast-IT" technology platform and its tools at the service of DevOps organisations.

To support its growth targets and ensure the success of its Strategic Plan 2020, the Board of Directors, by virtue of the authorisation granted by the General Meeting of 29 December 2016, decided to involve the company's management and give it a share of profits through the allotment of ordinary and preference shares free of charge.

This allotment, subject to attendance and performance conditions to the horizon of December 2019, could lead to the creation or allotment of up to 381,182 treasury shares (4.4% of capital). To date, Groupe Open holds 214,164 treasury shares acquired as part of its share buyback plan, which can be allotted when the above-mentioned shares are converted / acquired. Groupe Open will be continuing its share buyback policy in order to allot these shares as part of this plan.

Other key facts in 2016

• Dynamic sales performance rewarded by the signature of significant contracts and gains of strategic references, such as the Application Project Management Support contract with UGAP, as part of a consortium,

• An attractive brand as an employer with over 850 new recruits,

• Digital transformation of the company underway; deployment of a collaborative platform with a corporate social media network,

• New facilities in Lannion, Tours, Nantes, Lyon and Paris,

• Enhanced alliances and partnerships: IBM Bluemix (IBM's cloud services platform), Perfecto Mobile (testing solutions publisher), Izberg (Marketplace solutions publisher), Sigfox (Internet of Things telecoms operator) and Microsoft on its IoT and Big Data offerings,

• ISO 27001 certification obtained,

• Enhanced societal responsibility commitments; 58% improvement in the evaluation.

Summary and future prospects

In recent months, the actual digital transformation of companies has brought closer ties between their Information Systems Departments and Business Lines. This transformation requires the support of a new type of partner.

2016 brought recognition of the positioning of Groupe Open as the perfect match for this demand through its highly relevant value proposition combining IT and Digital, thus playing the role of a genuine Digital Service Company.

It is in this context that Groupe Open has carried out its own digital transformation:

• by completing its end-to-end offering through its first acquisitions and their successful integration,

• by enriching its customer relations through the provision of the StorebyOpen

• by revamping its processes with the implementation of collaborative tools and digitisation of its processes

• by developing its HR 2.0 policy embodied by a new Human Resources Director with a background in operations,

• by proposing a new and comprehensive digital ecosystem reflecting its assertive brand image

At 7%, organic growth in France well outstripped the market (2.5% growth according to Syntec Numérique), illustrating the relevance of this positioning.

Driven by these positive factors, 2017 should once again see significantly stronger growth in turnover than the market, and increased income despite a negative calendar effect (2 fewer days invoiced than in 2016). Organic growth should be backed by a certain number of carefully-targeted acquisitions, for which progress on the programme provides short to medium-term visibility.

These factors taken together suggest that the company is well on track to carry out its Strategic Plan 2020 taking it to turnover of €500 million and Current Operating Income of 10%.

2016 saw a sharp increase in share liquidity and the Group's entry into Segment B of Euronext.

The Board of Directors will be proposing to the next General Meeting on 17 May that a dividend of €0.34 per share be distributed.

These results will be commented on by Valérie Benvenuto, Frédéric Sebag and Guy Mamou-Mani at the SFAF meeting to be held on Thursday 16 March at 11.30am Turnover figures for Q1 2017 will be published in a news release issued on Thursday 20 April after the close of the stock exchange Nathalie Mrejen - Communication

Tel: [phone]

[e-mail]

About Groupe Open

With 3,700 employees and turnover of €305 million in 2016, Groupe Open is a leader in digital services and operates mainly in France, and also internationally in Belgium, the Netherlands, Luxembourg and China.

Open provides daily support to businesses and organisations in their industrial and digital transformation with its efficient, end-to-end IT and Digital offering encompassing the whole value chain of companies. Its objective is to transform the information systems of its clients in response to their new digital business models with a guarantee of stability, supervision and cost control to take up the challenges of Time to Market, agility, rapidity and experimentation.

The Groupe Open approach is resolutely forward-looking and built around its corporate values: Pertinence, Audacity, Ethics and Responsibility, Passion and Commitment.

For further information about Groupe Open: www.open.global

Media Relations - Wellcom Agency

Elise Plat & Sonia Perret - Tel: [phone] [e-mail] / [e-mail]