GECI INTERNATIONAL CONFIRMS ITS DOUBLE-DIGIT GROWTH, REDUCES ITS FINANCIAL DEBT BY 80% AND FURTHER STRENGTHENS ITS OUTLOOK
GECI International, a Digital and Technology specialist, is reporting +11% full-year revenue growth for 2023-24, with the Group continuing to build on its robust development. Supported by this continued growth, the strengthening of its financial position and the expected improvement in its profitability, GECI International confirms the relevance of its strategy and its ability to maintain sustainable growth.
KEY DEVELOPMENTS FOR THE YEAR
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GECI International recorded consolidated revenues of €22.8m during the year (April 2023-March 2024), up +11.0% compared with the previous year (+11.1% at constant exchange rates).
This organic progress primarily reflects the continued growth in operations to install telecommunications equipment in Brazil, as well as the continued development of the High Performance Computing (HPC) business in France. These advances are in line with the Company's strategy to focus its digital activities more on HPC, a high value-added activity with strong potential for development. However, financial IT and IT outsourcing saw a contraction in business over the year. Lastly, consolidated revenues take into account the deconsolidation of the Telecoms engineering activity in France since March 1, 2024 following the sale of its business operations[1].
At March 31, 2024, the breakdown of the Group's consolidated revenues was as follows: 60% in France and 40% in Brazil. It factors in a non-significant negative exchange effect in Brazil, representing 0.1% of revenues.
At end-March 2024, the Group had a total of 542 employees, compared with 530 at end-March 2023. The Group sold its "Telecoms" activities in France, which represented 27 people.
During the year, the Group continued moving forward with its international partnerships and alliances policy, particularly with IBM, Hewlett Packard Entreprise and Amazon Web Services (AWS) for technological and commercial aspects.
CHANGE IN REVENUES FOR EACH BUSINESS LINE AND REGION
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| (currently being audited) | Apr 2023 to Mar 2024 (12 months) | Apr 2022 to Mar 2023 (12 months) | Change | ||
| €m | % of rev | €m | % of rev | (%) | |
| Half-year periods | |||||
| H1 | 11.57 | 50.7% | 9.80 | 47.7% | + 18.0% |
| H2 | 11.25 | 49.3% | 10.77 | 52.3% | + 4.5% |
| Full-year revenues | 22.82 | 100% | 20.57 | 100% | + 11.0% |
| Business division | |||||
| Digital | 10.57 | 46.3% | 11.91 | 57.9% | - 11.3% |
| Technology | 12.26 | 53.7% | 8.66 | 42.1% | + 41.6% |
| Full-year revenues | 22.82 | 100% | 20.57 | 100% | + 11.0% |
| Region | |||||
| France | 13.68 | 60.0% | 15.27 | 74.2% | - 10.4% |
| Brazil | 9.14 | 40.0% | 5.27 | 25.6% | + 73.4% |
| Israel | 0.00 | 0.0% | 0.03 | 0.1% | ns |
| Full-year revenues | 22.82 | 100% | 20.57 | 100% | + 11.0% |
The Digital division (€10.6m, representing 46.3% of full-year revenues) is down -11.3% year-on-year. This contraction is linked mainly to the lower level of IT Outsourcing business over the period (-40.1%), while the activities relating to High Performance Computing (HPC) show solid growth (+5.4%) and the financial activities consolidated compared with the previous year's high performance levels.
The Technology division (€12.3m, representing 53.7% of full-year revenues) shows significant year-on-year growth of +41.6%. This sustained expansion is linked primarily to the ramping up of the Brazilian subsidiary's business development (+73.8% at constant exchange rates), resulting from the rollout of major contracts signed in previous years in the telecommunications sector. In France, the Telecoms business (€2.5m over 11 months) was marked by its deconsolidation from the Group's accounts since March 1, 2024. The Engineering business is stable compared with the previous year.
FINANCIAL POSITION
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FY 2023-24 shows a very significant reduction in the Group's financial debt and a marked improvement in its financial position, with:
- the strong revenue growth for the Technologies division and the resilience of the Digital division's revenues in a complex economic environment;
- the strengthening of its presence alongside its main contracting authorities with a range of stronger value-added solutions,
- the continued increase in the average daily billing rate in France (+9.2% between April 2023 and March 2024).
Net financial debt was reduced from €6.6m in March 2023 to €1.3m in March 2024, down €5.3m or 80% (figures currently being audited). This change primarily factors in the end of the Group's dispute with the party selling the Eolen companies, as well as the repayment of certain debt lines.
The Group's net financial debt at end-March 2024 includes €0.6m of financial debt (including overdrafts), €1.6m for the factoring advance, €0.9m of net OBSA bond and convertible bond debt, €0.5m for the restatement of lease charges, and €2.2m of cash.
During FY 2023-24, the Group raised:
- €0.25m gross following a drawdown of 25 ORNAN bonds redeemable in cash and/or new shares[2] in June 2023.
- €1.7m gross, in March 2024, through the bond financing set up with BSA warrants attached (OBSA). At year-end March 31, 2024, the Group had received more than half of the subscriptions, with the balance received in April 2024.
In addition, the sale of the Telecoms activity's business operations in France enabled the Group to further strengthen its cash position by €1.5m.
These various financial operations contributed to reducing the Group's debt and strengthening its equity at end-March 2024. They will also help consolidate its net working capital requirements and support its redeployment.
OUTLOOK FOR 2024-25
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The digital and technology markets, with exponential growth, are rapidly transforming and opening up promising possibilities.
- Alliance Services Plus ( AS+) leadership for High Performance Computing: a strategic asset for GECI International
AS+, a Group subsidiary, has built up strong expertise in IT activities relating to High Performance Computing (HPC) powering digital simulations, IA, Big Data… and has a leading position in France in this area.
In the last few years, HPC has become a strategic element for many sectors, including academic research (climatology, meteorology, genomics, etc.), industry (biotechnology, petroleum, automotive, space, aerospace, defense, etc.) and finance (banking, insurance, etc.). In line with this commitment to covering all research, industry and services sectors, GECI International is moving forward with its strategic repositioning around these sectors and looking to explore the opportunities for growth that they will open up.
- Differentiated business model focused on digital and technologies
Alongside this, the Group is continuing to differentiate its business model, around its two core divisions:
DIGITAL
| TECHNOLOGIES & SMART CITY With a view to offering a range of smart and competitive solutions, especially in terms of cluster residences, smart traffic, parking, energy savings, Internet of Things, etc. |
- ORNAN bonds
The Group does not currently intend to use its ORNAN budget, in view of the significant improvement in its financial position.
- Targeting profitable growth
Driven by its track record of innovation and its expertise in managing complex projects, GECI International aims to sustainably build on its growth, while expanding its economic footprint and adding to its range of solutions by developing its technological and business partnerships, both in France and around the world.
NEXT DATE
2023-24 full-year earnings on July 18, 2024 after close of trading (provisional date).
ABOUT GECI INTERNATIONAL
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"Smart Solutions for a Smart World"
GECI International is a specialist Technology and Digital group. Since it was founded in 1980, the Group has innovated to design and develop smart solutions, products and services for the Research, Industry and Service sectors.
Building on its recognized expertise, its ecosystem of technological and business partnerships, and its highly qualified capabilities, GECI International is rolling out a dynamic new entrepreneurial approach through customized solutions focused on the digital transformation, IT consulting, smart cities and emerging technologies. As a strategic partner, GECI International supports businesses and organizations with their drive for competitiveness, efficiency and effectiveness.
GECI International is listed on the Euronext Growth Paris market. ISIN (shares): FR001400M1R1 - ALGEC.
CONTACTS
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GECI International - Investor Relations
Tel: +33 (0)1 46 12 00 00 / relation.investisseurs@geci.net
CALYPTUS - Cyril Combe
Tel: +33 (0)1 53 65 68 68 / geci@calyptus.net
[1] See press release from March 22, 2024
[2] As authorized by the Combined General Meeting on September 29, 2022, the Company set up financing on May 12, 2023 for a total net nominal amount of up to €9.3m through the issuing of up to 1,000 ORNAN bonds reserved for YA II PN, Ltd. During the first half of the year, the Company carried out one drawdown for 25 ORNAN bonds on June 25, 2023. Out of these 25 ORNAN bonds drawn down, 11 were converted in November 2023 and led to the creation of 1,100,000,000 new shares, while 14 were converted in January 2024 following the stock consolidation and covered by the creation of 115,641 shares. At year-end, there were still 975 ORNAN bonds (undrawn), representing a gross total of €9.75m.
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