LECTRA: First Nine Months of 2019: resilient income from operations
despite a degraded macroeconomic environment
First Nine Months of 2019: resilient
income from operations despite a degraded macroeconomic
§ Revenues: €205.8 million (-3%)*
§ Income from operations: €29.7 million (-4%)*
§ Net income: €21.3 million (+6%)
§ Free cash flow: €18.1 million
§ Net cash: €102.4 million
|In millions of euros
July 1 – September 30
January 1 – September 30
Change like-for-like (%)(1)
|Income from operations
Change like-for-like (%)(1)
margin (in % of revenues)
Change at actual exchange rates (%)
|Free cash flow
- Like-for-like: 2019 figures restated at 2018 exchange
- At September 30, 2019 and December 31, 2018
Paris, October 30, 2019. Today,
Lectra’s Board of Directors, chaired by Daniel Harari, reviewed the
consolidated financial statements for the third quarter and first
nine months of 2019. The financial statements have not been
reviewed by the Statutory Auditors.
(Comparisons between 2019 and 2018 are
like-for-like, unless stated otherwise).
Q3 2019: stability in orders for new systems
Orders for new systems (€28 million) were stable
compared to Q3 2018. At actual exchange rates, they increased by
Revenues (€68.6 million) were stable, up 2% at
actual exchange rates.
Income from operations came to €12.3 million, up
2% (+9% at actual exchange rates) and the operating margin (17.9%)
increased by 0.4 percentage points.
Net income totaled €8.7 million, up €0.9 million
(+11%) at actual exchange rates.
Launch of the new Industry 4.0 offers in
In 2018, the Company launched in several
countries its first Industry 4.0 offers that enable customers to
digitalize and interconnect their entire value chain, and announced
they would be progressively available worldwide.
Lectra launched these new offers in Asia at
CISMA 2019 (the China International Sewing Machinery &
Accessories show devoted to textile and apparel technologies in
These new offers, whose initial results are in
line with the Company's expectations, will be rolled out worldwide
between now and the end of 2019, as planned. They should
increasingly contribute to revenue growth over the next three
Acquisition of the company Retviews
On July 15, 2019, Lectra entered into an
agreement to acquire the Belgium company Retviews (see press
release of that day).
Founded in 2017, Retviews has developed an
innovative technological offer that enables fashion brands to
analyze real-time market data and make the best decisions to
optimize their collections, increase their sales and margins,
thanks to artificial intelligence algorithms.
Retviews has been consolidated in Lectra's
accounts since July 15, 2019.
First Nine Months of 2019
Positive impact of euro appreciation
With an average exchange rate of $1.12/€1 for
the first nine months, the US dollar was up 6% compared to the same
period in 2018, while the yuan strengthened by 1% against the
Currency changes thus mechanically increased
revenues by €4.1 million (+2%) and income from operations by €2.6
million (+10%) at actual exchange rates compared to like-for-like
Lower than expected orders for new systems
The first nine months of the year were marked by
a very strong wait-and-see attitude by many companies, particularly
in the fashion and automotive markets, in a context of uncertainty
and apprehension. This adverse climate is primarily the consequence
of the trade wars between the United States, on the one hand, and
Mexico, China and Europe, on the other, and the slowing of the
automotive sector, particularly in China.
In these circumstances, orders for new systems
(€81.9 million) were down 10% compared to the first nine months of
2018: new CAD/CAM and PLM software licenses increased by 7%,
CAD/CAM equipment and accompanying software decreased by 15% and
training and consulting by 2%.
Resilient income from operations
Revenues totaled €205.8 million, down 3% (-1% at
actual exchange rates).
Revenues from software licenses, equipment and
non-recurring services (€79.7 million) decreased by 13%, and
recurring revenues (€126.1 million) increased by 5%.
While commercial activity was highly impacted by
the difficult macroeconomic environment, the Company's business
model proved its overall strength throughout the first nine months
of the year. The increase in recurring revenues and in gross profit
margins, combined with tight control over fixed overhead costs,
successfully offset the decline in revenues from software licenses,
equipment and non-recurring services.
Thus, income from operations (€29.7 million) was
down 4%, but up 5% at actual exchange rates.
The operating margin (14.4%) decreased by 0.1
percentage points (up 0.8 percentage points at actual exchange
Net income (€21.3 million) was up 6% at actual
Strong growth in free cash flow - a particularly
robust balance sheet
Free cash flow totaled €18.1 million (€8.8
million for the first nine months of 2018).
Consolidated shareholders’ equity came to €174.9
Cash and cash equivalents, as well as net cash
position, totaled €102.4 million, after the dividend payment of
€12.8 million and the disbursement of €8 million for the
acquisition of the company Retviews.
At the start of the year, the Company set
objectives of achieving revenue growth of 3% to 7% in 2019,
like-for-like, with growth in income from operations before
non-recurring items down 4% in the low assumption and up 4% in the
In light of the shortfall in orders for new
systems in the first half of the year and limited visibility
regarding those orders in the second half, the Company reported on
July 29 that it now anticipates a decline of 1% to 5% in revenues
and 4% to 14% in income from operations before non-recurring items,
The results of the third quarter and first nine
months of the fiscal year confirmed this anticipation.
Bolstered by the strength of its business model
and its roadmap fully geared to the demands of Industry 4.0, the
Company can remain confident in its prospects for the medium
Q4 and FY 2019 earnings will be published on
February 11, 2020.The management discussion and analysis of
financial conditions and results of operations and the financial
statements for the first nine months of 2019 are available on
For companies that
breathe life into our wardrobes, car interiors, furniture and more,
Lectra is crafting the premium technologies that facilitate the
digital transformation of their industry. Lectra’s offer empowers
brands and manufacturers from design to production, providing them
with the market respect and peace of mind they deserve. Founded in
1973, today Lectra has 34 subsidiaries across the globe, serving
customers in over 100 countries. With more than 1,750 employees,
Lectra reported revenues of $333 million in 2018. Lectra is listed
on Euronext (LSS).
Lectra – World Headquarters: 16–18, rue Chalgrin • 75016 Paris •
FranceTel. +33 (0)1 53 64 42 00 – Fax +33 (0)1 53 64 43 00 –
www.lectra.comA French Société Anonyme with capital of €31,885,155
• RCS Paris B 300 702 305
Historical Stock Chart
From Sep 2020 to Oct 2020
Historical Stock Chart
From Oct 2019 to Oct 2020