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IT Outsourcing

Pentalog reports Q2 results: 5% organic growth for its historical activities and 10% for the entire investment portfolio

Frédéric Lasnier
Frédéric Lasnier
Chief Executive Officer, Pentalog

Pentalog, an European IT Services Leader, has released its financial results for the second quarter ended June 30, 2013.

Financial Results for the Second Quarter 2013:

  • 10% overall growth
  • 5% organic growth from sales activities
  • 1.6% revenue growth from the IT consulting and services activities
  • 5 new clients
  • 100, 50 and 25% increase of sales figure registered by the  start-ups incubated by Pentalabbs (Easyflyer, Ecotravel and People Centric)
  • 810 employees at Group level

1.6% – this is the revenue growth our company achieved from the IT consulting and services activities (performed under the Pentalog trademark), despite the strong counter performance of the Joint Venture with the Ausy Group,  in which our partner is in charge of sales (-20% in Q2).

Although this second quarter 2013 has been marked by a reinforced crisis and an unfavorable calendar effect compared to 2012, Pentalog registered an organic sales growth of 5% from its stand-alone sales activities. We would first like to thank the sales department management for its high level involvement, as it closed 5 deals with new clients in Q2. The sales team members in Orleans, in particular, have considerably contributed to closing 4 new deals in France and Singapore this quarter. Moreover, new development opportunities are being implemented on the North-American continent, which open the door to new growth perspectives for 2013. As a matter of fact €3M have already been invoiced in the United States in 2012.

Except for the Joint Venture, 9% of the growth was registered only in France, thereby outperforming by 10 times the IT services company business sector. We registered a decrease in the commercial activities on the German market, but we managed to close one deal this quarter.

The Group’s strategy in terms of IT services related fields, launched in 2010 via the Pentalabbs incubation program, has remained extremely successful, as the 3 most dynamic start-ups powered by Pentalog, have registered a strong increase of their sales figure by 100, 50 and 25%.

Given the support of our incubation pole, the overall growth of Pentalog’s investments and of the associates group has reached almost 10%. And we are evolving in a recessionary context. Following this ascending trend, we expect the sales figure of the whole portfolio, including Pentalog, to reach €30M by the end of 2013, thus increasing from 10 to 12%.

As for human resources, there will be 810 employees working within the whole Group by the end of Q2, compared to 740 working within Pentalog only.

In terms of IT services activities, after having registered an attrition rate growth in Q1, we have noticed that this tendency is rapidly decreasing.

Last but not least, after a strong decrease at the end of Q4 2012, the profitability of the IT services activities has continued the solid recovery started in Q1 2013. Overall, the Q2 outcome is positive. We would like to commend the performance and the major efforts made by the teams, given the multiple stoppages and slowdowns of activity, particularly in the JV. The new clients’ start-ups and the expansion of the already existing teams have been more than rewarding.

We are aware that Q3 and Q4 will be equally difficult, as we continue to operate under the pressure of the European market still struggling with economic hardships, and of the continuing decrease in the activity of our JV’s main client. However, the group has long demonstrated its ability to reverse a negative tendency and forge its own destiny. Therefore, we remain cautious, but confident about the future.

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