PARIS & BRUSSELS--(BUSINESS WIRE)--Regulatory News:
AKKA (Paris:AKA) :
|H1 2018||H1 2017||Variation||
|International (excl. Germany)||158.6||145.7||8.9%||11.7%|
* Growth at constant scope, exchange rates and number of working days
- AKKA recorded a robust first half in 2018 thanks to strong organic growth and recruitments. This performance paves the way for an excellent second half.
- AKKA’s growth momentum continues, with the implementation of the CLEAR 2022 strategic plan and the successful rollout of the new single brand, which will strengthen the Group’s position as an accelerator of innovation for its customers.
- AKKA has entered into exclusive and firm negotiations to acquire PDS Tech, one of America’s leading players in engineering and R&D services, specialising in the aerospace industry. The completion of this transaction is scheduled for the third quarter and is an important first step in AKKA’s growth strategy in the United States.
FIRST-HALF 2018 REVENUE
- Consolidated revenue increased by 7.9% on an economic basis to €711.9 million in the first half of 2018. Organic growth was 7.3% during the half-year (6.2% in Q2, after 8.3% in Q1).
- Robust momentum in each of the Group’s three business units: organic growth amounted to 8.7% in France, 3.5% in Germany and 11.0% in the International BU.
- France is gaining traction from the underlying strength of the economy. Germany is finalizing the implementation of its new regional organisation and transversal digital offerings. The International BU is seeing growth in each of its major countries.
REVENUE BY BUSINESS UNIT
- As in the first quarter, the increase in the workforce is excellent, confirming the Group’s ability to recruit. This capacity lays the foundations for further strong organic growth in the coming quarters.
- With revenue of €301.4 million in the first half, the French Business Unit recorded excellent organic growth of 8.7% (8.9% in Q1 2018 and 8.5% in Q2 2018). This trend was driven by numerous contracts signed in the mobility segment, notably in the field of autonomous vehicles, with a strong growth in Communications activities. The growth of French activities benefitted from the growth in the Automotive, Aerospace, Life Sciences and Energy sectors. The net recruitment of 650 engineers (+9% on an organic basis) reflects the strength of the French BU and points to further strong growth for the second half of the year.
- The German Business Unit also made a strong start for the year. It reported revenue of €252.0 million in the first half of 2018, with organic growth of 3.5%. Growth was driven primarily by the signing of contracts with renowned OEMs such as Porsche and Volkswagen. In 2017, the group launched a transformation plan for its Germany Business Unit so as to roll out each of its unique skills at the national level while accentuating its regional proximity to its customers. The initial success of this transformation will allow the BU to deliver a 10% margin from operating activities1 in the second half.
- The Group’s International operations (excluding Germany) posted revenue of €158.6 million in the first half, an organic increase of 11.0%. After an excellent first quarter, the second quarter saw a fresh acceleration. Organic growth was 13.0%, compared with 8.9% in the first quarter of 2018. As in the first quarter, growth was driven chiefly by North America, Asia, Italy and the United Kingdom. Energy activities confirmed their return to growth, initiated in the first quarter by showcasing an organic growth of 9.0% over the first half. With double-digit organic growth in the second quarter, the Life Sciences segment reaffirmed its short- and medium-term growth momentum.
FIRST-HALF 2018 HIGHLIGHTS
- AKKA launched its CLEAR 2022 strategic plan during the first half. This plan will reinforce AKKA’s position as a leader in Mobility Technology Consulting, while sustainably improving the company’s financial performance and making the United States the third pillar of its geographic development.
- AKKA played a key role as one of Europe’s first in “on-demand autonomous mobility”, with the design of a shared and autonomous on-demand mobility service with Transdev. AKKA designed, developed and integrated the autonomous system used today in Transdev vehicles. The system includes all of the necessary automation bricks: identification, tracking and mapping the environment of an open-road vehicle under real-time constraints thanks to the intelligent technologies developed by AKKA Research and successfully transposed into the industrial world.
- AKKA is accelerating its expansion into the United States. On 5 June 2018, AKKA entered into exclusive and firm negotiations to acquire PDS Tech.
PDS Tech is one of the American leaders in Engineering and Technology services, with revenue of $260 million in 2017, and 2,600 talents. Mirroring its growth in Germany, which was achieved by combining organic growth and transformative acquisitions, AKKA is taking a controlled and orderly approach in the United States. The acquisition of PDS Tech will be the first step in AKKA’s rapid expansion in North America. It will allow AKKA to:
- Reach critical mass in the United States;
- Grow in the aerospace sector in the United States by building on its expertise in Europe and gaining access to a pre-eminent industrial customer base;
- Combine its established expertise in high value-added solutions with the tremendous recruiting capacity of PDS Tech across the entire breadth of America in order to support market growth;
- Strengthen its capacity to support its European customers in the US market;
- Take full advantage of the very strong momentum currently existing in the aerospace sector in the United States;
- Make an accretive acquisition from the first year.
The completion of the deal is expected in the third quarter of 2018. It is conditional upon the signing of the final agreements and is subject to the approval of the relevant authorities.
- 2018: The strong revenue momentum and vigorous hiring observed in 2017 continued in the first half of 2018, which bodes well for organic growth, with further improvement in margins for 2018.
CLEAR 2022 will enable the Group to capture the growth offered
by the digital revolution, permanently improving its financial
performance. Its 2022 targets are as follows:
- €2.5 billion in revenue
- €250 million in operating profit from ordinary activities2
- €150 million in free cash flow
H1 2018 results: Wednesday 12 September 2018 after trading on Euronext Paris
|Q1 2018||Q2 2018||H1 2018||Q1 2017||Q2 2017||H1 2017|
|International (excl. Germany)||77.3||81.3||158.6||72.4||73.2||145.7|
* Change at constant scope and exchange rates
** Growth at constant scope, exchange rates and number of working days
*** Growth at constant scope, exchange rates and number of working days and adjusted for the seasonal impact of Gigatronik in H1 2017
AKKA ranks as the European leader in engineering consulting and R&D services in the mobility sector. As an innovation accelerator for its clients, AKKA supports leading industry players in the automotive, aerospace, rail and life-sciences sectors throughout the life cycle of their products with cutting edge digital technologies (AI, ADAS, IoT, Big Data, robotics, embedded computing, machine learning, etc.).
Founded 1984, AKKA is characterized by a strong entrepreneurial culture and actively pursues is its fast-paced growth and international development in line with its strategic plan CLEAR 2022. With 16,300 technology passionate employees in 29 countries and dedicated to advancing the future of industry, the Group recorded revenues of €1.3 billion in 2017.
AKKA is listed on Euronext Paris – Segment B – ISIN code: FR0004180537.
For more information, please visit www.akka-technologies.com
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1 Margin calculated before non-recurring items and cost of
stock options and free shares
2 Profit from business operations calculated before non-recurring items and cost of stock options and free shares