SNP | Corporate News

SNP Off to a Good Start in 2019

2018 Consolidated Financial Statements:

- Group revenue of EUR 131.0 million (up by 7% over the previous year)

- Operating earnings before depreciation and amortization (EBITDA) of EUR 2.3 million (previous year: EUR 3.3 million)

- Operating cash flow of EUR 3.3 million (up by EUR 10.8 million over the previous year)

- Earnings per share of EUR -0.26 (previous year: EUR -0.47)

2019 Outlook:

- Group revenue expected to increase to between EUR 145 million and EUR 150 million

- Operating earnings margin (EBIT, IFRS) in the lower to mid-single-digit percentage range

- EBITDA margin (IFRS and non-IFRS) in the mid to upper-single-digit percentage range

Heidelberg, March 29, 2019 - SNP Schneider-Neureither & Partner SE got off to a strong start in 2019. As the company reported when presenting its annual figures for the 2018 fiscal year, SNP was able to continue with the positive developments of the second half of 2018 in the first few months of this year. On the whole, SNP's 2018 fiscal year was strongly characterized by investments in growth as well as measures to boost operational capacity and improve and secure profitability on a sustainable basis.

"We achieved further growth in 2018 and were able to improve our earning power significantly in the second half of the year. At the same time, we took important steps to set the course for our company's further development in terms of both personnel resources and strategy. We were able to build on this in the first few months of this year. As a result, we can conclude that SNP is off to a good start in 2019," said Dr. Andreas Schneider-Neureither, Chairman of the Board of Directors and CEO of SNP SE.

Specifically, the SNP Group generated Group revenue of EUR 131.0 million in the 2018 fiscal year, up by 7% compared to the previous year. The acquisitions made during the course of the previous year, which were consolidated for a full year for the first time in 2018, are the main reason behind this trend. Operating earnings before depreciation and amortization (EBITDA) came to EUR 2.3 million in the 2018 fiscal year compared to EUR 3.3 million a year earlier. The drop in earnings can be traced back primarily to customers' slower technical implementation of major transformation projects in the area of SAP S/4HANA and the associated lower level of capacity utilization in the consulting segment, as well as to lower-than-anticipated software license sales with SNP's in-house products.

The 2018 fiscal year produced a net loss of EUR -1.6 million (previous year: EUR -2.7 million). Accordingly, diluted and basic earnings per share amounted to EUR -0.26 (previous year: EUR -0.47).

Improvement in operating cash flow

At EUR 3.3 million, the cash flow from operating activities improved by EUR 10.8 million in 2018 compared to the previous year. This marked increase was due in particular to positive working capital effects.

The cash flow from investing activities came to EUR -12.0 million in 2018 compared with EUR -34.0 in 2017. The cash outflow is due first and foremost to purchase price installments paid for companies acquired in the previous years.

The cash flow from financing activities of EUR 15.5 million is mainly due to the successful capital increase of EUR 17.0 million; the cash inflow in the previous year came to EUR 44.0 million.

At EUR -8.7 million, the free cash flow showed a considerable improvement compared to the previous year's figure of EUR -41.5 million. At 45.7% (2017: 39.1%), the equity ratio remains at a very solid level. Net debt was reduced by EUR 6.9 million compared with the previous year, to EUR 0.9 million.

Significant operational improvements in the second half of 2018

Compared with the first half of 2018, revenue was increased by EUR 0.8 million to EUR 65.9 million in the second half of 2018. The EBIT margin increased disproportionately strongly to 5.3%, compared with -9.2% in the first half of 2018. This improvement in earnings was driven mainly by measures to boost profitability and by the dissolution of purchase price liabilities.

"We improved our working capital and increased our liquidity and profitability considerably in the second half of the year. This regained financial stability provides us with a strong basis for growth, both this year and beyond," says Dr. Uwe Schwellbach, CFO of SNP SE.

Forecast for 2019

Based on improved capacity utilization compared with the previous year and increasing software revenue, SNP still expects Group revenue of between EUR 145 million and EUR 150 million in the 2019 fiscal year. Regarding the operating earnings margin (EBIT margin, IFRS), the company expects to achieve a value in the lower to mid-single-digit percentage range, as well as an EBITDA margin (IFRS and non-IFRS) in the mid to upper-single-digit percentage range. The SNP Group continues to adhere to the prioritized mid-term goal of structurally increasing and maintaining profitability.

"In view of our progress with our corporate structures and the corresponding increase in capacity for customers, the unchanged strong market and order situation, and our international sales and software strategy, we anticipate stable business development in the current fiscal year. We are convinced that SNP is on the right track and will continue on its expansion course," explained Dr. Andreas Schneider-Neureither.

The 2018 Annual Report, published today, can be downloaded from the SNP website at http://www.snpgroup.com/en/financial-publications

About SNP

SNP SE supports organizations in adapting their business models and using new technologies. SNP software and services facilitate the implementation of business or technical modifications to business applications.

CrystalBridge^(R) and SNP Transformation Backbone^(R) with SAP Landscape Transformation are the world's leading software suite for data transformations that automatically analyzes, implements and tracks changes to IT systems. As a result, they offer clear qualitative advantages, while significantly reducing the time and expense involved in transformation projects. The SNP Group has over 1,350 employees worldwide.

Headquartered in Heidelberg, the company generated revenue of approximately EUR 131 million in the 2018 fiscal year. SNP's customers are global corporations from all industries. SNP was founded in 1994 and has been publicly traded since 2000. As of August 2014, the company is listed on the Prime Standard segment of the Frankfurt Stock Exchange (ISIN DE0007203705). Since 2017, the company has operated as a European stock corporation (Societas Europaea/SE).

Further information is available at www.snpgroup.com

Investor Relations Contact:

Marcel Wiskow
Tel: +49 6221 6425-637
Fax: +49 6221 6425-470
Email: [email protected]
https://www.snpgroup.com/en/investor-relations/