Devoteam announces its strategic plan 2020: Scale!
A target of EUR1 billion of revenue in 2020 2016 revenue expected at EUR555
million with 8.5% operating margin
Paris, January 19, 2017
Devoteam presents Scale!, its strategic plan for 2020. In keeping with the
EAGLE plan, launched in 2012, Devoteam affirms its capacity to combine growth,
profitability and innovation.
Since its creation, Stanislas and Godefroy de Bentzmann, co-founders of
Devoteam, have made strong strategic choices. As Stanislas de Bentzmann states:
"Proximity and agility have enabled us to become a major player in management
and innovative technology consulting, in Europe and in the Middle East.
The Group is in a favorable position to carry out its ambitious development,
focusing our energy and investments on targeted offers, in the countries where
we are already present, closest to major Cloud publishers.
The strong entrepreneurial spirit that drives our teams must remain a
fundamental pillar of Devoteam, and we reinforce it with more synergies at the
Strong financial foundations
The EAGLE strategic plan launched in 2012 enabled Devoteam to regain one of the
best profit and growth levels in the market thanks to the structuring of its
operating model and the rationalization of its activities.
Scale! capitalizes on this solid position to secure the Group's growth and
Offers supported by the dynamic growth of SMACS
Social Mobile Analytics Cloud Security (SMACS) is experiencing strong momentum
and is expected to almost double to 30% of the IT services market in 2020
(Source: Gartner). Taking advantage of this dynamic market, Devoteam is making
SMACS its major activity by focusing its portfolio on 6 offers, deployed on 2
* First wave: Digital Workplace, Agile IT Platform and CyberSecurity;
* Second wave: Business Process Excellence, Data as a Service and Digital
Key strategic partnerships
Web giants and global publishers compete in the Cloud market and invest
massively in new technologies, stimulating the pace of adoption by customers.
In this context, Devoteam wishes to strengthen its strategic partnerships with
five worldwide players: 3 global (Google, Red Hat, ServiceNow) and 2
multi-local partnerships (Salesforce and Microsoft).
A targeted geographic footprint
As companies seek more proximity and agility, the Group retains its multi-local
positioning supported by strong management. Devoteam concentrates its
investments on four priority geographic hubs - France, Germany, Spain and
Belgium - which will foster the Group's growth and margins.
The CIO at the center of the strategy
Although there is an increasing role for business lines in technological
decisions, CIOs take center stage in organizations to ensure the convergence of
legacy IT and digital. Devoteam concentrates its portfolio of offers to support
CIOs in their new roles and in their enhanced collaboration with the business
Financial targets 2020
In the context of Scale!, Devoteam aims to deliver an ambitious level of
revenue growth and operational performance by 2020, reflecting the potential of
the Group's targeted markets and the efficiency of its business model.
The Group plans to achieve:
* 7 to 10% average annual organic growth (excluding Between) between 2016 and
* Continuous improvement of the operating margin (in percentage of revenue) to
reach at least 10% in 2020;
* Double digit average annual growth over the period of fully diluted earnings
* Normative level of free cash flow around 5% of revenues.
In addition to these organic objectives, the Group is committed to growing by
acquisition which should contribute at least EUR200 million to 2020
consolidated revenues, without impacting the Group's ambitions of operating
As a result of the strategic initiatives, the Group plans to be in a position
to achieve revenues of EUR1 billion by 2020.
Landing for 2016 and guidance for 2017
While the full-year closing is still under progress and may affect these
figures, the Group currently expects 2016 consolidated revenue to be in the
region of EUR555 million, which represents 13% organic growth on 2016, or 8%
when excluding the activities of Between. Operating margin should be in the
region of EUR47 million and should represent 8.5% of the revenue.
In 2017, the Group is planning for consolidated revenues to grow by 7%
organically when excluding Between, despite the lower number of working days
(1.5 day less compared to 2016). Including the contribution of Between, the
changes of perimeter and the impact of the exchange rates, the Group is
targeting to achieve consolidated revenues in the region of EUR580 million.
The Group expects the operating margin to continue to improve in 2017 compared
to 2016 and to stand close to 9% of the revenue, despite the unfavorable
working days effect. The restructuring costs should not be higher than 0.5% of
Between: the " Between" subsidiary in the Netherlands, specializing in
"sourcing" of IT professionals, has a relatively volatile revenue to the extent
that, according to the contracts concluded and the type of missions carried
out, revenue recognized in the consolidated accounts is either gross margin
contracts or the entire client billing. Consequently, the Group separates this
activity to calculate its growth aggregates
Operating margin: current operating result excluding the cost of share-based
payments and the amortization of intangible assets resulting from
Free cash flow: net cash from operating activities minus acquisition of fixed
At Devoteam, we deliver innovative technology consulting for business.
We are 4,100 professionals dedicated to ensuring our clients win their digital
Present in Europe and in the Middle East, drawing on 20 years of experience, we
improve business performance making their companies truly digital. We build IT
infrastructure for digital, and make sure people are along for the ride.
In 2015, Devoteam achieved revenues of 485MEUR.
At Devoteam, we are Digital Transformakers.
Stanislas de Bentzmann,
Group controlling & investor relations director
Group reporting & investor relations manager