LECTRA

First nine months of 2020: revenues and earnings impacted by the COVID-19 crisis - Seite 2

(Comparisons between 2020 and 2019 are like-for-like, unless stated otherwise. As the impact of the acquisition of Retviews on the financial statements for the first nine months of 2020 is not material, like-for-like changes exclude only the variations in exchange rates.).

Q3 2020: signs of improvement

In its Q1 and Q2 financial reports, published April 29 and July 27, 2020, respectively, the Group had anticipated the impact of the COVID-19 crisis and its consequences on the financial statements for 2020.

While the repercussions of the pandemic continued to mark Q3, several signs of improvement were observed.

Indeed, after a decline of 42% in Q2, orders for perpetual software licenses, equipment and accompanying software, and non-recurring services (20.7 million euros) were down 21% compared to Q3 2019.

The annual value of new software subscription orders (0.8 million euros) was up 75%, thus confirming the adoption of Lectra's new offers for Industry 4.0, sold in SaaS mode.

At the same time, revenues from consumables and parts, a leading indicator of the Group's customers’ activity, declined by 9%, following a 46% drop in Q2.

Total revenues (56.5 million euros) decreased by 15% (-18% at actual exchange rates).

Income from operations (8.5 million euros) was down 24% (-31% at actual exchange rates) and the operating margin (15%) 1.8 percentage points (down 2.9 percentage points at actual exchange rates).

Net income (6.6 million euros) decreased by 24% at actual exchange rates. It was down 85% in Q2 2020.

Free cash flow was positive by 8.5 million euros (5.6 million euros in Q3 2019).

First nine months of 2020

The COVID-19 epidemic and its consequences really marked the first nine months of 2020.

From the start of the crisis, the Group took the necessary hygiene and physical distancing measures to safeguard the health of employees, customers, suppliers and other stakeholders. These measures are still in effect.

Lockdown measures implemented by most countries, especially during the first half of the year, have led to a significant reduction in activity by the Group's customers, and to the suspension of some commercial discussions with Lectra.

While a gradual increase in activity occurred in Q3, many customers have not reached the level of activity they had before the crisis and have been led to temporarily reduce their capital expenditures or operating expenses. All three strategic market sectors—fashion, automotive and furniture—have been strongly impacted.