INGENICO

Paris : ING


February 27, 2013 12:34 ET

INGENICO : Very strong annual performance in 2012

NEUILLY-SUR-SEINE, FRANCE--(Marketwire - Feb 27, 2013) -


  * Strong increase in 2012 revenue to EUR1.206 billion, up 20% on a
    reported basis and 14.5% on a comparable basis[1]

  * Proven ability to increase margins while investing in future
    sources of growth

      * EBITDA up 24% to 18.5% of revenue
      * Profit attributable to Ingenico S.A. shareholders up 71%
        to EUR97 million


  * Free cash flow up 82% to EUR125 million

  * Proposed dividend of EUR0.70 euro, up 40%

  * 2013 outlook at constant perimeter: like-for-like growth greater
    or equal than 8% and EBITDA margin exceeding 18.5%

Paris, February 27, 2013 - Ingenico (Euronext: FR0000125346 - ING) announced today its fourth quarter 2012 revenue and its audited financial statements for the full year ended December 31, 2012.

             |2012 |   2011       2011 |             2012/2011           |
 Key figures |     | restated  restated|              change             |
 (in millions|     |pro forma  reported|                                 |
 Euro)       |     | [2] [3]      [3]  |                                 |
             |     |                   |                                 |
             |     |                   |                                 |
-------------+-----+-------------------+---------------------------------+
             |     |                   |  Comparable      Reported basis,|
             |     |                   |  basis [2]         restated [3] |
-------------+-----+-------------------+---------------------------------+
 Revenue     |1 206|  1 022     1 001  |     14% [1]           +20%      |
-------------+-----+-------------------+---------------------------------+
 EBITDA      | 223 |    184       180  |     21%               +24%      |
             |     |                   |                                 |
    As a % of|18.5%|   18.0%     18.0% |   +50 bpts           +50 bpts   |
     revenue |     |                   |                                 |
-------------+-----+-------------------+---------------------------------+
 EBIT        | 190 |    153       151  |     24%               +26%      |
             |     |                   |                                 |
    As a % of|15.7%|   14.9%     15.1% |    +80 bpts          +60 bpts   |
     revenue |     |                   |                                 |
-------------+-----+-------------------+---------------------------------+
 Net Profit  | 97  |      -        56  |      -                +71%      |
 attributable|     |                   |                                 |
 to          |     |                   |                                 |
 shareholders|     |                   |                                 |
-------------+-----+-------------------+---------------------------------+

Philippe Lazare, Chairman and CEO of Ingenico, commented: "Ingenico has once again performed outstandingly in 2012 in an unsettled macroeconomic environment. Fueled by innovation and products, growth has been strong in all our segments. As a result, we have strengthened our positions in our legacy markets while steadily developing in emerging markets.

We have also significatively increased our margins and cash flow, while investing heavily in high-growth markets and mobile payment.

Our acquisition of Ogone is particularly positive news. We can now implement our strategy more effectively and expand our offer to include multi-channel payment solutions for merchants and acquirers.

Finally, Ingenico will consolidate its lead by leveraging its diversified international footprint, its innovative strength, its move into multi- channel delivery solutions and a long-term relevant strategy. So we have every reason to feel confident about the outlook for 2013 and anticipate further growth in revenue and profitability."

Subsequent events

Agreement for the acquisition of Ogone, leading pan-European online payment services provider

On January 29, Ingenico announced it has reached an agreement in principle with Summit Partners to acquire Ogone, the leading pan-European online payment services provider for an enterprise value of EUR 360 million.

This acquisition represents a key milestone in the execution of Ingenico's strategy of becoming the unique "one-stop-shop" provider covering multi- channel payment solutions: point-of-sale, online and mobile. The final documentation and closing are expected in the end of Q1 2013.

In 2012, with more than 280 employees, Ogone reached EUR 42 million of revenue, with an EBITDA margin of around 30%. The recent commercial initiatives, including the Barclaycard white-label contract win, should generate a revenue growth in excess of 30% in 2013.

2012 Results

Key figures

 (in million euros)    FY2012|     FY2011 pro               FY2011        |
                             | forma restated 2 3    Reported restated 3  |
-----------------------------+--------------------------------------------+
 Revenue               1 206 |         1 022                 1 001        |
                             |                                            |
 Adjusted gross profit  513  |          425                   413         |
                             |                                            |
       As % of revenue 42.5% |         41.6%                 41.3%        |
                             |                                            |
 Adjusted operating    (323) |         (272)                 (263)        |
 expenses                    |                                            |
-----------------------------+--------------------------------------------+
 Profit from ordinary        |                                            |
 activities, adjusted   190  |          153                   151         |
 (EBIT)                      |                                            |
                             |                                            |
       As % of revenue 15.7% |         14.9%                 15.1%        |
-----------------------------+--------------------------------------------+
 Profit from operating  164  |           -                    107         |
 activities                  |                                            |
-----------------------------+--------------------------------------------+
 Net profit             100  |           -                     58         |
-----------------------------+--------------------------------------------+
 Net profit              97  |           -                     56         |
 attributable to             |                                            |
 shareholders                |                                            |
-----------------------------+--------------------------------------------+
 EBITDA                 223  |          184                   180         |
                             |                                            |
                       18.5% |         18.0%                 18.0%        |
-----------------------------+--------------------------------------------+
 Free Cash Flow         125  |           -                     69         |
-----------------------------+--------------------------------------------+
 Net debt                75  |           -                    110         |
                             |                                            |
 Equity attributable    689  |           -                    623         |
 to shareholders             |                                            |
-----------------------------+--------------------------------------------+


Revenue: up 14%

+------------------+-------------------------+------------------------+
|                  |          2012           |  Fourth quarter 2012   |
|                  +-----+-------------------+----+-------------------+
|                  | MEUR| Change 2012/2011  |MEUR| Change 2012/2011  |
|                  |     +----------+--------+    +----------+--------+
|                  |     |Comparable|Reported|    |Comparable|Reported|
+------------------+-----+----------+--------+----+----------+--------+
|Europe-SEPA       | 507 |    9%    |  12%   |131 |   -2%    |  -1%   |
+------------------+-----+----------+--------+----+----------+--------+
|Latin America     | 211 |   29%    |  22%   |66  |   31%    |  22%   |
+------------------+-----+----------+--------+----+----------+--------+
|Asia-Pacific      | 207 |   13%    |  23%   |73  |   27%    |  35%   |
+------------------+-----+----------+--------+----+----------+--------+
|North America     | 91  |    9%    |  17%   |31  |    3%    |   9%   |
+------------------+-----+----------+--------+----+----------+--------+
|EEMEA             | 90  |   16%    |  17%   |26  |   -2%    |   0%   |
|                  |     |          |        |    |          |        |
|Central Operations| 100 |   23%    |  98%   |25  |   18%    |  56%   |
+------------------+-----+----------+--------+----+----------+--------+
|Total             |1 206|   14%    |  20%   |353 |   10%    |  13%   |
+------------------+-----+----------+--------+----+----------+--------+

Performance for the year

In 2012, revenue totaled EUR1,206 million, up 20 percent on a reported basis. This included a positive foreign exchange impact of EUR25 million. Total revenue included EUR981 million generated by the Payment Terminal activity (hardware, servicing and maintenance) and EUR225 million generated by Transaction Services.

On a comparable basis,(1) revenue was 14 percent higher than the 2011 pro forma figure, thanks to vigorous growth across all segments. Revenue from Payment Terminals increased by 13 percent, driven by high growth in emerging economies, a changing competitive landscape and product offers tailored to the different geographic areas. Revenue from Transaction Services also continued to increase (up 23 percent) thanks to TransferTo's expanding business and the increasing international presence of easycash and Axis payment solutions. Excluding TransferTo, organic growth in Transaction Services reached 8 percent in 2012.

All regions contributed to the Group's overall strong performance. During the year, Ingenico took full advantage of the changing competitive landscape and high growth in the emerging markets,[4] whose share of total revenue increased from 45 percent in 2011 to 48 percent.

- The pace has accelerated in Latin America (up 29 percent), the main
  driver being  extremely strong growth in Brazil, where the Group has
  taken advantage of a rapidly expanding payment terminal business and
  a greater share of the market.

- Rapid growth has continued in Asia-Pacific (up 13% percent), as Ingenico
  has consolidated its strong foothold in  China and expanded its market
  presence in Southeast Asia, notably in Indonesia.

- Business in the EEMEA region is up by 16 percent. In particular, sales
  activity has increased in Russia where Ingenico strengthened its direct
  presence by acquiring its distributor during the year.

Sales performance was likewise very strong in Europe (up 9 percent). In Payment Terminals, Ingenico took full advantage of a changing competitive landscape in the most important markets, above all in the United Kingdom, France and Central Europe.

And finally, as expected, business grew in North America (up 9 percent). Sales were up 9 percent in the U.S., where the Group marketed its Telium terminal range (EMV and contactless) to large retail, but also to a lesser and increasing extent to merchants through distributor networks and ISOs (Independent Sales Organizations).

The Group's Central Operations"division reported 23 percent growth, due to expanding business for TransferTo.

Services, Maintenance and Transactions accounted for 30 percent of total revenue, with Transactions alone contributing 19 percent, up approximately 2 points compared with the reported figure for 2011.

Performance in the fourth quarter

In the fourth quarter 2012, revenue totaled EUR353 million, up 13 percent on a reported basis. This included a positive foreign exchange impact of EUR5 million. Total revenue included EUR294 million generated by the Payment Terminal activity (hardware, servicing and maintenance) and EUR59 million generated by Transaction Services.

On a comparable basis,(1) revenue was 10 percent above the Q4 2011 pro forma figure. Revenue in Payment Terminals was up 10 percent, even with an unfavorable basis of comparison with Q4 2011, when growth was particularly strong in Europe- SEPA (independently of underlying economic conditions) and Latin America. Organic growth in Transaction Services increased by 9 percent, or by 3 percent excluding TransferTo.

During the fourth quarter, Ingenico exceeded expectations with continued high growth in Latin America (up 31 percent). The primary driver was still Brazil, where the Group capitalized on its expanding market share.

As expected, revenue increased significantly in Asia-Pacific (up 27 percent), with China and Southeast Asia as key contributors. Although performance in Europe-SEPA (down 2 percent) was affected by an unfavorable basis of comparison, business has remained robust in most countries.

In North America (up 3 percent), sales increased considerably in Canada, while performance in the United States was impacted by the postponement, requested by a major chain store, of a large shipment starting in the first quarter of 2013. The Group remains confident, however, about the business outlook in the United States, given that contracts have already been signed with large-scale retailers and intermediaries/ISO to equip small merchants.

Gross margin high - up 90 basis points

On a pro forma basis, gross margin increased by 90 basis points to 42.5 percent in 2012. The main driver of this performance was the 200 basis point increase in gross margin in Payment Terminals (hardware, servicing and maintenance) to 44.4 percent of revenue, mostly due to strong volume growth and the Group's procurement power.

Gross profit on Transaction Services was 34.4 percent, compared with 37.4 percent in 2011 on a pro forma basis, reflecting TransferTo's growth, which has a dilutive impact on gross profit. Excluding TransferTo, gross profit was 44.3 percent in 2012 versus 44.7 percent in 2011 pro forma.

Operating expenses under control at 26.8 percent of revenue

In 2012, adjusted operating expenses stood at EUR323 million, as against EUR272 million in 2011 on a pro forma basis. This increase was primarily attributable to higher performance-based sales expenses, along with R&D investments in future sources of growth, particularly in the United States and in the mobile payment segment. The higher general and administrative expenses reflect the move initiated in 2011 to expand support functions at Group and regional level. In 2012, adjusted operating expenses were stable at 26.8 percent of revenue, as against 26.7 basis percent of revenue in 2011 (pro forma).

As expected, adjusted operating expenses in the second half of 2012 were stable at EUR163 million as against EUR160 million in the first half, notably as the result of a decrease in general and administrative expenses. The Group thus drove operating expenses down by 490 basis points to 24.6 percent of revenue compared with the first half of 2012.

EBITDA up 21 percent

EBITDA increased by 21 percent to EUR223 million, up from EUR184 million in 2011 (restated pro forma figures). The EBITDA margin increased by 50 basis points to 18.5 percent of revenue, as against restated pro forma 2011.

EBIT margin up 80 basis points

In 2012, EBIT increased by 24 percent to EUR190 million, compared with EUR153 million in 2011 (restated pro forma figures). The EBIT margin was 15.7 percent of revenue, up by 80 basis points.

Continued significant growth in profit from operations: 54 percent

In 2012, other operating income and expenses showed net income of EUR1.0 million, versus an EUR18 million net expense in 2011. This improvement reflects the positive impact of remeasurement of ROAM Data's assets and liabilities after the Group gained control of this entity in February 2012, as well as higher other expenses in 2011.

Purchase Price Allocation expenses held steady at EUR26 million.

Profit from operations is up by 54 percent to EUR164 million from EUR107 million in 2011. Operating margin increased by 290 basis points to 13.6 percent of revenue.

Net profit attributable to Ingenico S.A. shareholders up 71 percent to EUR97 million

In 2012, the net profit attributable to Ingenico S.A. shareholders was EUR97 million, up from just EUR56 million in 2011.

This result includes a decrease in net finance costs to EUR14 million (down from EUR26 million in 2011): the non-recurring expenses on the syndicated loan facility refinanced in August 2011 were over, and losses by equity-accounted associates were much lower than in the previous year.

Income tax expense increased from EUR22 million in 2011 to EUR50 million in 2012. The tax rate stood at 33.1 percent[5] in 2012, compared with 26.9 percent in 2011, due primarily to a shift in the Group's sources of profit toward higher- tax jurisdictions and the lack of factors favorable to deferred tax recognition.

Proposed dividend of 0.70 euro per share, up 40 percent

In 2012, net earnings per share were EUR1.87, up from EUR1.11 in 2011. The Board of Directors will be proposing that the shareholders vote at their Annual Meeting of April 29, 2013 to distribute a dividend of EUR0.70 per share, with dividends payable in cash or in shares, at the option of the holder.

A sound financial position

Total equity attributable to shareholders increased to EUR689 million.

Net debt decreased to EUR75 million at December 31, 2012 from EUR110 million at December 31, 2011.

During the year, Ingenico's operations generated free cash flow of EUR125 million, up 82 percent. This increase is mainly attributable to a strong increase in EBITDA to EUR223 million and good control over working capital, with a surplus of EUR3 million, versus a EUR30 million deficit in 2011. This was made possible by strict management of inventories and trade receivables, and by higher net trade payables in a period of strong business expansion. At the same time, Ingenico continued to invest to support Group expansion, with investing activities net of disposals totaling EUR44 million.

The main cash outflows in 2012 were EUR14 million in dividend payments (EUR0.50 per share) in respect of 2011 and the acquisitions carried out during the year, totaling EUR69 million net of disposals, and notably: the Group gained a controlling interest in ROAM Data, acquired its distributor in Russia and strengthened its strong positions in China, exercising a put option on Landi shares and forming a joint venture with ZTE to develop a mobile payment acceptance network for merchants in China.

Ingenico's financial ratios at December 31, 2012 demonstrate the Group's sound financial position. The net to equity ratio was 11 percent, while the net debt to EBITDA(1) ratio was 0.3.

2013 outlook

In a contrasting macroeconomic environment, the Group has begun 2013 with full confidence in its ability to sustain the momentum - in terms of both revenue and profitability - thanks to its excellent positioning, its wide range of solutions and its recent strategic investments.

In this early portion of the year, business seems to be holding up well and should continue to expand in emerging markets and North America. The Group reminds that 2011 represents a very high basis of comparison, given that independently of underlying economic conditions, revenue in that period were particularly high in the Europe SEPA Region and in Latin America as the competitive landscape changed significantly.

In this context and not including the impact of the Ogone acquisition, which should be completed by the end of the first quarter, Ingenico should post a revenue growth greater or equal than 8% on a comparable basis (on a like- for- like basis at constant exchange rates) and an EBITDA1 margin growth of 18.5% or higher.

CONFERENCE CALL

A conference call to discuss Ingenico's 2012 results will be held on February 27, 2013 at 6.00 p.m., Paris time. Dial in number: 01 70 99 32 12 (French domestic) or +44 (0)20 7162 0177 (international). The presentation will also be available on www.ingenico.com/finance.

This press release contains forward looking statements. The trends and objectives given in this release are based on data, assumptions and estimates considered reasonable by Ingenico. These data, assumptions and estimates may change or be amended as a result of uncertainties connected in particular with the performance of Ingenico and its subsidiaries. These statements are by their nature subject to risks and uncertainties as described in Ingenico registration document ("document de reference"). These forward looking statements in no case constitute a guarantee of future performance, and involve risks and uncertainties. Actual performance may differ materially from that expressed or suggested in the forward looking statements. Ingenico therefore makes no firm commitment on the realization of the growth objectives shown in this release. Ingenico and its subsidiaries, as well as their executives, representatives, employees and respective advisors, undertake no obligation to update or revise any forward looking statements contained in this release, whether as a result of new information, future developments or otherwise.

About Ingenico (Euronext: FR0000125346 - ING)

Ingenico is a leading provider of payment solutions, with over 20 million terminals deployed in more than 125 countries. Its 4,000 employees worldwide support retailers, banks and service providers to optimize and secure their electronic payments solutions, develop their offer of services and increase their point of sales revenue. More information on www.ingenico.com | twitter.com/Ingenico. |

                                  Next events

             FY12 conference call: February 27 2013 at 6pm (Paris)

                      Investor Day: March 26 2013 (London)

                      Q1 13 revenue release: April 24 2013


                                   EXHIBIT 1:

                  Basis for preparing the 2012 annual accounts

The consolidated financial data has been drawn up in accordance with International Financial Reporting Standards. In order to provide meaningful comparable information, that data has been presented on an adjusted basis, i.e. restated to reflect the depreciation and amortization expenses arising on the acquisition of new entities. Pursuant to IFRS 3 and to IFRS3R, the purchase price for new entities is allocated to the identifiable assets acquired and subsequently amortized over specified periods.

As of 2012, foreign exchange gains and losses from translation of operations denominated in foreign currency (including the effective portion of any related hedging instruments) are now recognized in cost of sales, instead of in net finance costs. To facilitate comparison, the income statements for the half year ended June 30, 2011 and the fiscal year ended December 31, 2011 have been restated and are available in Exhibit 3.

The main financial data for 2012 is discussed on an adjusted basis, i.e., before Purchase Price Allocation (PPA); see Exhibit 4.

To facilitate the assessment of Ingenico's performance in 2012, revenue and key financial figures for first half 2011 have been restated from January 1, 2011 to reflect the change in the scope of consolidation which have occurred during 2011 fiscal year (acquisition of TNET, Paycom and XIRING) and the change in the recognition of foreign exchange gains and losses arising on translation of transactions denominated in foreign currency (« pro forma 2011 restated »).

EBITDA is not an accounting term; it is a financial metric defined here as profit from ordinary activities before amortization, depreciation and provisions and before expenses of shares distributed to employees and officers (the reconciliation of profit from ordinary operations to EBITDA is available in Exhibit3).

EBIT is equal to profit from ordinary activities, adjusted for amortization of the purchase price for newly acquired entities allocated to the identifiable assets acquired.

Free cash flow is equal to EBITDA less: cash and other operating income and expenses, changes in working capital requirements, investing activities net of disposals, financial expenses net of financial income and tax paid.

                                   EXHIBIT 2:

              Income statement, balance sheet, cash flow statement

    1.  CONSOLIDATED INCOME STATEMENT (AUDITED)

    2.  CONSOLIDATED BALANCE SHEETS (AUDITED)

    3.  CONSOLIDATED CASH FLOW STATEMENTS (AUDITED)


                                   EXHIBIT 3:

    Impact of evolution of recognition of foreign exchange gains and losses

As of 2012, foreign exchange gains and losses from translation of operations denominated in foreign currency (including the effective portion of any related hedging instruments) are now recognized in cost of sales, instead of in net finance costs. The income statements for the fiscal year ended December 31, 2011 have been restated to facilitate comparison.


                                                               2011
     (in million euros)     |2011 Reported| Adjustments| Reported Restated|
----------------------------+-------------+------------+------------------+
 Revenue                    |    1001     |     -      |         1001     |
                            |             |            |                  |
 Adjusted gross profit      |     417     |    (4)     |          413     |
                            |             |            |                  |
 Adjusted operating expenses|    (262)    |     -      |         (262)    |
----------------------------+-------------+------------+------------------+
 Profit from ordinary       |     155     |    (4)     |          151     |
 activities, adjusted (EBIT)|             |            |                  |
----------------------------+-------------+------------+------------------+
 Profit from operating      |     111     |    (4)     |          107     |
 activities                 |             |            |                  |
----------------------------+-------------+------------+------------------+
 Financial result and equity|    (30)     |     +4     |         (26)     |
 method                     |             |            |                  |
----------------------------+-------------+------------+------------------+
 Net profit before tax      |     81      |     -      |          81      |
----------------------------+-------------+------------+------------------+
 Net profit                 |     58      |     -      |          58      |
----------------------------+-------------+------------+------------------+
 Net profit attributable to |     56      |     -      |          56      |
 Shareholders               |             |            |                  |
----------------------------+-------------+------------+------------------+
 EBITDA                     |     184     |    (4)     |          180     |
----------------------------+-------------+------------+------------------+


                                   EXHIBIT 4:

Impact of purchase price allocation (PPA)

      (in millions of euros)          2012      PPA Impact    2012 reported
                                    excl. PPA
---------------------------------------------------------------------------
  Gross Profit                         513         (-)            513
---------------------------------------------------------------------------
  Operating expenses                  (323)        (26)          (349)
---------------------------------------------------------------------------
  Profit from ordinary activities      190         (26)           164
---------------------------------------------------------------------------


Reconciliation of profit from ordinary activities to EBITDA

EBITDA represents profit from ordinary activities, restated to include the
following:

  * Provisions for impairment of tangible and intangible assets, net of
    reversals (including impairment of goodwill or other intangible assets
    with indefinite lives, but not provisions for impairment of
    inventories, trade and related receivables and other current assets),
    and provisions for risks and charges (both current and non-current)
    on the liability side of the balance sheet, net of reversals.
  * Expenses related to the restatement of finance lease obligations on
    consolidation.
  * Expenses recognized in connection with the award of stock options,
    free shares or any other payments to be accounted for using IFRS 2,
    Share-based Payment.
  * Changes in the fair value of inventories in accordance with IFRS 3,
    Business Combinations, i.e. determined by calculating the selling
    price less costs to complete and sell.


Reconciliation

  (in millions of euros)   2012       2011 pro forma          2011 reported
                                        restated                restated
---------------------------------------------------------------------------
 Profit from ordinary      163             127                     125
 activities
---------------------------------------------------------------------------
 Allocated assets           26             26                      26
 amortization
---------------------------------------------------------------------------
 EBIT                      190             153                     151
---------------------------------------------------------------------------
 Other amortization and     29             27                      25
 provisions for
 liabilities

 Share based payment        5               4                       4
 expenses
---------------------------------------------------------------------------
 EBITDA                    223             184                     180
---------------------------------------------------------------------------


---------------------------------------------------------------------------

[1] On a like-for-like basis at constant exchange rates.

[2] Data restated to reflect the Group's structure at January 1, 2012.

[3] Data restated to reflect a change in the recognition of exchange gains
or
losses on operations denominated in foreign currency.

[4] The term "emerging markets" refers here to Latin America, Asia Pacific,
EEMEA and TransferTo.

[5] Tax rate: tax expense/(profit before income tax - share of profits of
associates).


INGENICO: http://hugin.info/143483/R/1681702/549854.pdf

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Source: INGENICO via Thomson Reuters ONE

[HUG#1681702]

Contact Information

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