Welcome!

News Feed Item

Axway: 8.0% Total Revenue Growth in the First Half of 2014, Excellent Progression in Maintenance (9.5%) and Services (9.9%), Total Growth in Licenses Stood at 3.2%

Regulatory News:

Axway (Paris:AXW):

The Board of Directors of Axway Software, under the chairmanship of Pierre Pasquier, closed the financial statements for the first six months of 2014, which show:

  • Total revenue of €114.9 million in H1/2014 with organic growth of 5.7% compared to the first half of 2013;
  • Profit on operating activities of €5.4 million or 4.7% (compared with 6.7% in the first half of 2013);
  • Net profit of €2.8 million.
Key income statement items   HY 2014       HY 2013       FY 2013
  (in M€)   ( % Rev)       (in M€)   ( % Rev)       (in M€)   (% Rev)
             
Revenue 114.9     106.4     237.5    
Organic growth 5.7%     4.8%     3.7%    
Profit on operating activities 5.4   4.7% 7.1   6.7% 37.5   15.8%
Profit from recurring operations 3.0   2.6% 4.6   4.3% 32.4   13.7%
Other income and expense -1.0     -5.2     -5.3    
Net financial costs and currency impact -0.7     -0.5     -1.3    
Income Taxes 1.6     10.9     9.8    
Net profit - Groupe share   2.8   2.4% 9.8   9.2% 35.6   15.0%
(in €) (in €) (in €)
Basic net earnings per share   0.13 0.48 1.75

Comments on activity

On overall activity: The demand in Middleware's historical segments (MFT/B2B/Integration) is continuing to undergo a major transformation, confirming the importance of incorporating today's emergent yet extremely dynamic technologies (API and Operational Intelligence-OI). The impact of these new technologies in the Middleware segment is still limited and led to an overall stable level of licenses over Q2.

Revenue by region, France has sustained excellent growth over the past two years. The Rest of Europe remains well positioned with the exception of Germany on the second quarter. Axway's business remained under pressure in the United States where a slowdown in demand for infrastructure projects has been observed.

Revenue by geographical zone

M€                    
1st Quarter   2014   2013 Published   2013 Pro forma   Total
Growth
  Organic
Growth(1)
         
France 18.2 16.9 16.9 7.4% 7.4%
Rest of Europe 14.1 12.3 12.3 14.3% 14.1%
America's 17.9 19.1 18.4 -6.4% -2.9%
Asia/Pacific   1.9   1.6   1.4   21.8%   36.1%
Axway 52.0 49.9 49.1 4.3% 6.1%
                     
2nd Quarter 2014 2013 Published 2013 Pro forma Total Growth Organic
Growth(1)
         
France 24.6 17.9 21.7 37.4% 13.3%
Rest of Europe 15.0 14.4 14.5 3.7% 3.2%
America's 21.0 22.5 21.9 -6.8% -4.2%
Asia/Pacific   2.3   1.7   1.6   41.5%   50.3%
Axway 62.8 56.5 59.6 11.3% 5.4%
                     
1st Semester 2014 2013 Published 2013 Pro forma Total Growth Organic
Growth(1)
         
France 42.7 34.8 38.6 22.8% 10.7%
Rest of Europe 29.0 26.7 26.8 8.6% 8.2%
America's 38.9 41.6 40.3 -6.6% -3.6%
Asia/Pacific   4.3   3.2   3.0   31.9%   43.5%
Axway 114.9 106.4 108.7 8.0% 5.7%

(1) at constant exchange rates and scope of consolidation

Revenue by activity, weak demand from the infrastructure market has penalized Licenses, especially in the USA. There was a lack of “major contract” wins during the second quarter, which was not compensated by the very encouraging gains made in the API and OI segments.
Maintenance's outstanding performance should be underscored and it now represents more than half (50%) of the overall business activity over the six-month period.
Services continue to make a turnaround with total growth of close to 10% during the first half.

Revenue by type of activity

M€

1st Quarter   2014   2013
Published
  2013
Pro forma
  Total
Growth
  Organic
Growth(1)
         
Licenses 10.8 10.6 10.3 1.8% 4.4%
Maintenance 26.7 25.7 25.3 4.0% 5.8%
Services   14.5   13.6   13.5   6.6%   7.9%
Axway 52.0 49.9 49.1 4.3% 6.1%
 
                     
2nd Quarter 2014 2013
Published
2013
Pro forma
Total
Growth
Organic
Growth(1)
         
Licenses 17.1 16.4 17.1 4.1% 0.0%
Maintenance 30.7 26.7 28.3 14.7% 8.4%
Services   15.1   13.4   14.3   13.1%   6.0%
Axway 62.8 56.5 59.6 11.3% 5.4%
 
                     
1st Semester 2014 2013
Published
2013
Pro forma
Total
Growth
Organic
Growth(1)
         
Licenses 27.8 27.0 27.4 3.2% 1.7%
Maintenance 57.4 52.4 53.6 9.5% 7.2%
Services   29.6   27.0   27.7   9.9%   6.9%
Axway 114.9 106.4 108.7 8.0% 5.7%

(1) at constant exchange rates and scope of consolidation

Customers have greeted the OI (Operational Intelligence) technology, coming from the Systar acquisition in the first half of 2014, as a real enhancement to Axway's offering and the products synergies have been developing very naturally.
In the first half of 2014, management devoted a considerable amount of energy to the Systar acquisition that was successfully completed in June 2014, now allowing an integration project to take place in the second half of 2014.
Profit on operating activities amounted to €5.4 million (4.7% of revenue). In comparison with the first half of 2013, the weaker performance of Licenses in the second quarter of 2014 should be taken into account.

Financial position

Axway sustained a robust financial position at June 30, 2014, with a cash balance of €41.3 million and equity totaling €255.3 million. Bank indebtedness amounted to €60.9 million at June 30, 2014 including the financing for the acquisition of Systar in April 2014. The company’s debt at June 30, 2014 allows us to comfortably respect our banking covenants.
The June 30, 2014 net income per share of €0.13 per share is not directly comparable to the same period of 2013. The 2013 first semester net result integrates the GSA matter settlement with the American Department of Justice and the activation of the tax losses in the United States, made possible from the growth in profitability (historic and forecasted) of the US subsidiary of the group. Without the impact of these two exceptional items, our net result would have been €5.6 million or €0.27 per share as compared to €0.13 per share for the same period in 2012.

The consolidated interim financial statements were subject to a limited audit. The limited audit report is in the process of being published.

Workforce

The integration of Systar's teams during the first half of 2014 led to an increase in the Group's employees as at June 30, 2014.
At June 30, 2014, Axway’s workforce numbered 1,984 employees (722 in France and 1,262 outside France), an increase of 201 people from December 31, 2013 (and of 186 people from June 30, 2013).

Strategy

Axway's positioning as a specialist in governing the flow of data is based on:

  • A state-of-the-art offering requiring frequent product investments and enhancements to the functional scope (such as API and OI);
  • Being a leading player in the market in formalizing and offering value propositions to customers with business investments and marketing as the driving factors in achieving this.

Axway's strategy is consistent with this approach. Using its position in governing the flow of data, it aims to reflect the changes in the Middleware market, which is seeking to implement solutions that go beyond the coverage of technological capabilities and respond to the challenges of the digital company.

Outlook

As with each year, the performance in the first half does not provide any particular indication as to what the overall performance for the year will be. The following events should be taken into account for Axway: the slowdown in licenses recorded in the second quarter; the change in demand leading to a momentum differentiating the relevant technologies; the necessary efforts to integrate Systar in order for it to achieve an appropriate level of profitability at year-end as well as the expected volume of licenses by the end of the year, which is not fully visible at present. With this in mind:

  • Axway confirms its outlook for positive organic growth in 2014;
  • The operating profit margin should be similar to that of 2013.

Financial Calendar

Friday, July 25, 2014:

  • 2:30 pm: French Society of Financial Analysts (SFAF) meeting at the Shangri-La Hotel in Paris (in French).
  • 6:00 pm: Webinar (in English)

Thursday, October 30, 2014 (before the market opening): Publication of the Q3 2014.

The company will publish its half-year financial report in French on August 29, 2014. This report will be available at www.finance.axway.com under the Financial Documents tab and also on the AMF website: www.amf-France.org.

Income Statement              
(in thousands of euros) HY 2014 HY 2013 FY 2013
Revenue :
Licenses 27 837 26 970 75 583
Maintenance 57 395 52 417 106 348
Total Product Revenue 85 232 79 387 181 931
Services 29 638 26 979 55 613
Total Revenue : 114 870 106 366 237 544
Costs of sales:
Product Revenue 11 498 10 547 20 721
Services 28 106 25 734 51 407
Total Costs of sales : 39 604 36 281 72 128
Gross profit: 75 266 70 085 165 416
as a % of Revenue 65.5% 65.9% 69.6%
Operating expenses :
Sales and marketing 37 180 33 870 70 763
Research and development 20 186 17 642 33 636
General and administrative 12 491 11 443 23 549
Total operating expenses : 69 858 62 955 127 948
Profit on operating activities 5 408 7 130 37 468
as a % of Revenue 4.7% 6.7% 15.8%
Stock option releated expenses (437) (645) (1 352)
Amortization of intangible assets (1 991) (1 898) (3 679)
Profit from recurring operations 2 980 4 587 32 437
as a % of Revenue 2.6% 4.3% 13.7%
Other income and expenses (969) (5 177) (5 271)
Operating profit 2 012 (590) 27 166
Cost of net financial debt (407) (204) (674)
Other financial revenues and expenses (276) (275) (656)
Income taxes 1 633 10 881 9 759
Net Profit of the consolidated group 2 962 9 813 35 595
as a % of Revenue 2.6% 9.2% 15.0%
Minority Interest 203 - -
Net Profit - Groupe share 2 759 9 813 35 595
as a % of Revenue   2.4%       9.2%       15.0%
Basic net earnings per share (in Euro)   0.13       0.48       1.75
Simplified Balance Sheet   30/06/2014       31/12/2013       30/06/2013
  (in M€)       (in M€)       (in M€)
ASSETS
Goodwill 226.4 189.3 195.6
Intangible assets 41.8 28.8 31.3
Property, plant and equipment 6.9 6.3 5.9
Other non-current assets 57.0 45.7 30.4
Non-current assets 332.2 270.1 263.2
 
Trade receivables 65.7 64.4 57.7
Other current assets 13.4 8.3 22.7
Cash and cash equivalents 41.3 49.2 54.1
Current assets 120.4 121.9 134.5
     
TOTAL ASSETS 452.6 392.0 397.7
 
SHAREHOLDERS’ EQUITY AND LIABILITIES
Share capital 41.1 40.9 40.7
Capital reserves and results 214.2 217.4 198.0
Total shareholders’ equity 255.3 258.4 238.7
 
Financial debt – long term portion 51.1 28.5 37.9
Other non-current liabilities 22.0 15.5 19.6
Non-current liabilities 73.1 44.0 57.5
 
Financial debt – short-term portion 13.0 9.5 4.7
Other current liabilities 111.1 80.1 96.8
Current liabilities 124.1 89.6 101.5
TOTAL LIABILITIES 197.3 133.6 159.0
     
TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES 452.6 392.0 397.7
                     
Cash Flow Statement   HY 2014       HY 2013       FY 2013
    (in M€) (in M€)       (in M€)
 
Net profit for the period 3.0 9.8 35.6
Net charges to amortizations, depreciations and provisions 4.6 8.1 8.0
Other income and expense items 0.6 1.0 1.7
Cash from operations after cost of net debt and tax 8.2 18.9 45.3
Changes to operating working capital requirements 21.3 19.8 (3.6)
Costs of net financial debt 0.4 0.4 0.7
Income tax paid net of accrual (2.2) (12.1) (14.1)
Net cash from operating activities 27.7 27.0 28.3
Net cash used in investing activities (52.5) (1.5) (3.6)
Proceeds on shares issued 1.0 0.5 2.2
Dividends paid (8.2) (7.1) (7.1)
Change in loan 23.9 - (4.4)
Net interest paid (0.4) (0.4) (0.7)
Other changes 0.2 0.2 0.3
Net cash from (used in) financing activites 16.6 (6.8) (9.7)
Effect of foreign exchange rate changes 0.4 - (1.2)
NET CHANGE IN CASH AND CASH EQUIVALENTS (7.9) 18.7 13.8
 
Opening cash position 49.2 35.4 35.4
CLOSING CASH POSITION 41.3 54.1 49.2
                     

Disclaimer

This document is a free translation into English of the original French press release. It is not a binding document. In the event of a conflict in interpretation, reference should be made to the French version, which is the authentic text.

About Axway

Axway (NYSE Euronext: AXW.PA), a market leader in governing the flow of data, is a global software company with more than 11,000 public- and private-sector customers in 100 countries. For more than a decade, Axway has empowered leading organizations around the world with proven solutions that help manage business-critical interactions through the exchange of data flowing across the enterprise, among B2B communities, cloud and mobile devices. Our award-winning solutions span business-to-business integration, managed file transfer, operational intelligence, API and identity management, and email security– offered on premise and in the Cloud with professional and managed services. Axway is registered in France with headquarters in the United States and offices in 19 countries.

www.axway.com

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
In addition to all the benefits, IoT is also bringing new kind of customer experience challenges - cars that unlock themselves, thermostats turning houses into saunas and baby video monitors broadcasting over the internet. This list can only increase because while IoT services should be intuitive and simple to use, the delivery ecosystem is a myriad of potential problems as IoT explodes complexity. So finding a performance issue is like finding the proverbial needle in the haystack.
UpGuard has become a member of the Center for Internet Security (CIS), and will continue to help businesses expand visibility into their cyber risk by providing hardening benchmarks to all customers. By incorporating these benchmarks, UpGuard's CSTAR solution builds on its lead in providing the most complete assessment of both internal and external cyber risk. CIS benchmarks are a widely accepted set of hardening guidelines that have been publicly available for years. Numerous solutions exist t...
Amazon has gradually rolled out parts of its IoT offerings in the last year, but these are just the tip of the iceberg. In addition to optimizing their back-end AWS offerings, Amazon is laying the ground work to be a major force in IoT – especially in the connected home and office. Amazon is extending its reach by building on its dominant Cloud IoT platform, its Dash Button strategy, recently announced Replenishment Services, the Echo/Alexa voice recognition control platform, the 6-7 strategic...
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
Big Data, cloud, analytics, contextual information, wearable tech, sensors, mobility, and WebRTC: together, these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at @ThingsExpo, Erik Perotti, Senior Manager of New Ventures on Plantronics’ Innovation team, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it ...
In his session at Cloud Expo, Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, will provide economic scenarios that describe how the rapid adoption of software-defined everything including cloud services, SDDC and open networking will change GDP, industry growth, productivity and jobs. This session will also include a drill down for several industries such as finance, social media, cloud service providers and pharmaceuticals.
DevOps at Cloud Expo – being held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Am...
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
"We host and fully manage cloud data services, whether we store, the data, move the data, or run analytics on the data," stated Kamal Shannak, Senior Development Manager, Cloud Data Services, IBM, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
With the proliferation of both SQL and NoSQL databases, organizations can now target specific fit-for-purpose database tools for their different application needs regarding scalability, ease of use, ACID support, etc. Platform as a Service offerings make this even easier now, enabling developers to roll out their own database infrastructure in minutes with minimal management overhead. However, this same amount of flexibility also comes with the challenges of picking the right tool, on the right ...
IoT is rapidly changing the way enterprises are using data to improve business decision-making. In order to derive business value, organizations must unlock insights from the data gathered and then act on these. In their session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, and Peter Shashkin, Head of Development Department at EastBanc Technologies, discussed how one organization leveraged IoT, cloud technology and data analysis to improve customer experiences and effi...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
SYS-CON Events announced today that MangoApps will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.
The IETF draft standard for M2M certificates is a security solution specifically designed for the demanding needs of IoT/M2M applications. In his session at @ThingsExpo, Brian Romansky, VP of Strategic Technology at TrustPoint Innovation, explained how M2M certificates can efficiently enable confidentiality, integrity, and authenticity on highly constrained devices.
“delaPlex Software provides software outsourcing services. We have a hybrid model where we have onshore developers and project managers that we can place anywhere in the U.S. or in Europe,” explained Manish Sachdeva, CEO at delaPlex Software, in this SYS-CON.tv interview at @ThingsExpo, held June 7-9, 2016, at the Javits Center in New York City, NY.