Exclusive networks: the best…

(Boursier.com) — Exclusive Networks rose 2% to €15.50, while the cybersecurity specialist posted a half-year gross income of €1,947.4 million, an increase of 33.8% compared to 2021 in published data and 31.2% to constant exchange rate. “Most of this growth (72%) is the result of activities with existing suppliers in their current geographies. The balance of this growth comes from 14% from supplier expansion and 14% from acquisitions. Supplier expansion is a combination of our vendors entering new geographies (~5%) and new vendor relationships (~9%) The acquisitions of Ignition Technology and Networks Unlimited supported our growth through external operations,” management commented.

Supplier retention rate increased in the first half of 2022, supported by growing demand for solutions from our suppliers and continued engagement from our channel partners. The net retention rate in euros in the first half of 2022 increases by 128%, compared to 112% in the first half of 2021 and the net customer retention rate in euros increases by 127%, compared to 108% in the first half of 2021 ).

The net margin stood at 187.6 million euros in the first half of 2022, 29% more than in the previous year. It is below revenue growth due to variation in geographic distribution and size of operations.
Adjusted EBITA increased significantly to €66.5 million, 39.3% more than in 2021, faster than revenue growth. The EBITA margin adjusted to net margin increased 261 bps compared to the previous year, to 35.4%, as the Group benefited from operating leverage.
Adjusted net profit amounted to €47.5 million, an increase of 49.4% compared to 2021.


Free cash flow from operating activities before taxes amounted to €166.2 million in the first half of 2022, representing a cash conversion of 227.7% of adjusted EBITDA, compared to 111.7% in the year past. This increase in cash generation during the period was driven by the solid commercial performance and a significant release of working capital thanks to the reinforcement of non-recourse factoring lines, the improvement of commercial conditions with suppliers and the new payment schedule for the VAT in the United Kingdom, reducing working capital by a total amount of 103 million euros in the first half of 2022, despite the growth in activity.

Given the strong performance in the first half of 2022 that extends into the second half of the year, Exclusive Networks’ management team decided to improve its outlook for fiscal 2022 as follows:
– Gross revenue should now exceed €4.2bn (vs. previously forecast over €3.8bn);
– Net margin should now be between €392m and €400m (compared to €362m to €368m previously);
– Adjusted EBITA should now be between €146m and €152m (compared to €133m and €138m previously);
– And pre-tax free cash flow from operating activities is now expected to exceed 160% of adjusted EBITA vs. 80% of adjusted EBITA previously…

Among the latest brokers’ opinions, Morgan Stanley has once again “overweighted” the file and has adjusted its target from 20 to 21 euros…

Vince Fernandez

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