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27 September 2011 2011 first-half results

Recovery in margins confirmed

SQLI Group’s consolidated financial statements at the end of June are clear evidence of the company’s ability to rapidly improve its profitability as it harnesses the first benefits of its strategic plan, Boost.

A STRONG SALES DYNAMIC TO MATCH A STRONG BUSINESS STRATEGY

SQLI generated revenues of €85.1 million for the first half of 2011. While the Group’s decision to refocus on its strategic businesses led to a slight drop in scope over 12 months, like-for-like, growth was up 2%.

Bolstered by healthy operating indicators (improvement in business levels, stable average daily rate) and the first effects of its restructuring, SQLI enjoyed a sharp improvement in profitability. At the end of June, the Group’s current operating income came in at €3.5 million compared to a loss of €0.3 million one year earlier.

Net of interest charges and tax of €1.6 million (including €0.5 million in CVAE - French tax levy on the value added of businesses), SQLI booked a net profit of €1.4 million for the period compared with a net loss of €1.5 million for the first six months of 2010.

A SOLID FINANCIAL STRUCTURE

The success of SQLI’s €17 billion bond issue (OBSAAR) in April 2011 has reinforced the financial structure of the Group. At the end of June, shareholders’ equity amounted to €57.4 million, up €2.3 million over six months on the back of earnings for the period and the net valuation of the redeemable equity warrants (BSAAR) at €0.7 million. Net financial debt stayed low at €3.9 million.

BOOST PLAN IS FIRMLY ON TRACK

Today’s lackluster macroeconomic climate means that most of the improvement in SQLI’s business performance is linked to its strategic plan, Boost. Capitalizing on the Group’s “DNA” (innovation, technological expertise and quality of service), the plan aims to set SQLI firmly back on the road to lasting profitable growth.

Boost has three core priorities: to streamline SQLI’s corporate footprint, improve its operating efficiency and develop its value-added product and service offering. While the first two growth drivers are already well underway, the changes to SQLI’s products and services are more gradual. First off the production line is a new solution called Ubigreen which is designed to encourage an environmentally-responsible approach to infrastructure management that ensures a rapid return on investment. This new offer illustrates the innovation policy implemented by SQLI and destined to develop new solutions that offer high profitability at a low cost.

TARGETS MAINTAINED DESPITE AN UNCERTAIN CLIMATE

The current financial crisis has prompted SQLI to adopt a prudent strategy in order to anticipate the possible repercussions on the real economy. The Group is particularly vigilant when it comes to trends in its operating indicators and has accelerated the implementation of its Boost plan.

This strategy means that SQLI is able to confirm its target of an operating income of over €5 million for 2011 as a whole, i.e. double the figure posted in 2010 (€2.6 million).

SQLI will publish its 2011 third-quarter turnover on 15 November 2011 after the close of trading.

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