Teleperformance: First-Half 2018 Results

Regulatory News:

The Board of Directors of Teleperformance (Paris:TEP), the worldwide leader in outsourced omnichannel customer experience management, met today and reviewed the consolidated financial statements for the six months ended June 30, 2018. The Group also announced its half-year financial results.

SOLID REVENUE AND EARNINGS PERFORMANCE, DESPITE THE UNFAVORABLE EXCHANGE RATE ENVIRONMENT

• Revenue: €2,070 million in H1 2018
  up + 8.3 % like-for-like
  up + 9.9% like-for-like in Q2 2018

• EBITA before non-recurring items: €246 million, for a margin of 11.9%, vs. 11.8% in H1 2017
• Diluted earnings per share: €2.10, up + 6.1% vs. H1 2017
• Net free cash flow: €156 million

SIGNIFICANTLY STRONGER GLOBAL MARKET LEADERSHIP

• Creation of more than 6,300 workstations in the Group’s key markets in the first half of 2018
• Expansion of Specialized Services with the announcement in June 2018 of an agreement to buy Indian firm Intelenet, a major provider of high-end business services and digital transformation solutions

2018 GUIDANCE RAISED AND REFINED

• Like-for-like revenue growth of more than + 7.5%, vs. + 6% in previous guidance
• EBITA margin before non-recurring items above 13.5% at constant scope of consolidation
• Sustained strong net free cash flow generation

CONFIRMATION OF 2022 TARGETS

• Revenue of more than €6 billion
• EBITA before non-recurring items of more than €850 million, or 14.2% of revenue
• Targets to be updated on completion of the Intelenet acquisition, scheduled to take place in September 2018

INTERIM FINANCIAL HIGHLIGHTS

				H1 2018				H1 2017				% change
				€1=US$1.22				€1 = US$1.08
€ millions												Reported				Like-for-like*
Revenue				2,070				2,081				- 0.6%				+ 8.3%
EBITDA before non-recurring items*				323				328				- 1.5%
EBITA before non-recurring items*				246				245				+ 0.4%
% of revenue				11.9%				11.8%
Operating profit				190				191				- 0.5%
Net profit - Group share				123				116				+ 6.0%
Diluted earnings per share (€)*				2.10				1.98				+ 6.1%
Net free cash flow*				156				178				- 12.4%

* A glossary of alternative performance indicators is included in the Appendix

Commenting on this performance, Teleperformance Chairman and Chief Executive Officer Daniel Julien said:

"We had a first half with solid revenue growth at constant exchange rates and further gains in our EBITA margin, in line with our full-year 2018 targets. It was also the twelfth straight half-year in which our like-for-like growth (of more than + 8%) outperformed the market (around + 4%), once again confirming our status as a growth company.

Increased profitability, achieved in an unfavorable exchange rate environment, reflected strong momentum in Core Services in our most profitable markets as well as in our high-value Specialized Services.

Our growth was not only profitable but also controlled, with solid margins and excellent liquidity management discipline both reflected in continued strong cash flow generation.

This healthy performance gives us confidence, both in the achievement of our full-year targets and in the smooth ongoing implementation of our five-year strategic plan. In addition, the Intelenet acquisition announced in June should enable us to achieve our 2022 targets ahead of time.

From a strategy perspective, Intelenet brings to Teleperformance its high-end integrated solutions and extensive expertise in the area of digital transformation for businesses. The acquisition will provide an immediate and substantial boost to Teleperformance’s offering.

Backed by our very encouraging first-half results, we are raising our full-year 2018 guidance and are now targeting like-for-like revenue growth of more than + 7.5% and an EBITA margin before non-recurring items of above 13.5% at constant scope of consolidation.

Thanks to solid cash flow generation, Teleperformance is well placed to rapidly reduce its net debt over the next two years.”

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

FIRST-HALF AND SECOND-QUARTER 2018 REVENUE

CONSOLIDATED REVENUE

In the first half of 2018, consolidated revenue amounted to €2,070 million, representing a year-on-year increase of + 8.3% on a like-for-like basis. As reported, revenue was virtually stable (- 0.6%), reflecting a sharply negative €170 million currency effect that was mainly linked to the US dollar’s decline against the euro and, to a lesser extent, the decrease in the Brazilian real and the Colombian and Argentine pesos.

In the second quarter, consolidated revenue amounted to €1,044 million. On like-for-like basis, revenue increased by + 9.9%, representing a faster pace of growth than in the first quarter of the year. As reported, revenue growth came out at + 2.8%, due to the negative currency effect attributable primarily to the US dollar’s weakness against the euro. However, since April 2018 the Group’s revenue has begun to benefit from the recent rise in the US dollar against the euro.

REVENUE BY ACTIVITY

				H1 2018				% total				H1 2017				% total				% change
€ millions																				Reported				Like-for-like
CORE SERVICES				1,754				85%				1,752				84%				+ 0.1%				+ 8.7%
English-speaking market & Asia-Pacific				740				36%				812				39%				- 8.8%				+ 0.3%
Ibero-LATAM				560				27%				534				26%				+ 4.7%				+ 17.1%
Continental Europe & MEA				454				22%				406				19%				+ 12.0%				+ 14.5%
SPECIALIZED SERVICES				316				15%				329				16%				- 4.1%				+ 5.7%
TOTAL				2,070				100%				2,081				100%				- 0.6%				+ 8.3%

				Q2 2018				% total				Q2 2017				% total				% change
€ millions																				Reported				Like-for-like
CORE SERVICES				881				84%				851				84%				+ 3.5%				+ 10.6%
English-speaking market & Asia-Pacific				369				36%				387				38%				- 4.6%				+ 1.5%
Ibero-LATAM				286				28%				264				26%				+ 8.6%				+ 20.4%
Continental Europe & MEA				225				22%				200				20%				+ 12.6%				+ 15.4%
SPECIALIZED SERVICES				163				16%				164				16%				- 0.6%				+ 6.3%
TOTAL				1,044				100%				1,015				100%				+ 2.8%				+ 9.9%
				Q1 2018				% total				Q1 2017				% total				% change
€ millions																				Reported				Like-for-like
CORE SERVICES				874				85%				901				85%				- 3.1%				+ 7.0%
English-speaking market & Asia-Pacific				371				36%				425				40%				- 12.7%				- 1.0%
Ibero-LATAM				274				27%				271				25%				+ 1.0%				+ 13.8%
Continental Europe & MEA				229				22%				206				20%				+ 11.4%				+ 13.6%
SPECIALIZED SERVICES				152				15%				165				15%				- 7.7%				+ 5.0%
TOTAL				1,026				100%				1,066				100%				- 3.8%				+ 6.7%

• Core Services

Core Services revenue amounted to €1,754 million in the first half of 2018, a gain of + 8.7% on a like-for-like basis compared to the same year-ago period. Revenue remained stable on a reported basis (up + 0.1%), with the negative currency effect mainly attributable to the decline in the US dollar, Brazilian real and the Colombian and Argentine pesos against the euro.

As in the first quarter, like-for-like growth in the first half was supported by very good performances in the Ibero-LATAM and Continental Europe & MEA regions. It also benefited, as expected, from a gradual recovery in the English-speaking market & Asia-Pacific (EWAP) region, where revenue returned to growth in the second quarter of the year.

• English-speaking market & Asia-Pacific

Revenue in the English-speaking market & Asia-Pacific region amounted to €740 million in the first half of 2018, remaining virtually stable year-on-year on a like for like basis (up + 0.3%). On a reported basis, however, revenue was down 8.8% as a result of the US dollar’s weakness against the euro. In the second quarter, revenue was up + 1.5% like-for-like and down 4.6% as reported, compared with the second quarter of 2017.

Teleperformance continued to diversify its client portfolio in the region over the first half of the year. The most dynamic major client segments were e-retail, fast-moving consumer goods, the energy industry and utilities.

Consumer electronics, the region’s top revenue contributor, expanded at a satisfactory pace, and sustained growth was recorded in the automotive industry and food services, which are still relatively underrepresented in the Group’s client portfolio.

Despite the recent start-up of a major contract in the United States, telecommunications revenue remained lackluster, particularly in the Philippines (offshore services).

In the second quarter, the region benefited from an improvement in revenue growth in the United Kingdom, particularly in the consumer electronics, administration, energy and local community services segments, despite the still uncertain economic environment.

In Asia, the return to a solid pace of growth initiated in the first quarter of 2018 was confirmed over the first half, after a lukewarm performance in 2017. Development in the region continued to be driven by China and India, the most promising markets for outsourced business services.

In light of the contracts signed recently and the projects already underway, the Group confirms the projection communicated at the beginning of the year of a return to stronger growth in the region starting in the second half.

• Ibero-LATAM

Revenue from the Ibero-LATAM region amounted to €560 million in the first half of 2018. As in the first quarter, business continued to expand at a very healthy rate and to exceed budget forecasts. Growth came to + 17.1% on a like-for-like basis versus the same year-ago period, but was limited to + 4.7% as reported due to the negative currency effect related mainly to the weakening of the US dollar, the Brazilian real and the Colombian and Argentine pesos against the euro.

In the second quarter, revenue was up + 20.4% like-for-like, confirming the very good performance posted in the first quarter.

The region’s main growth driver was Portugal, where the Group continued to benefit from the fast development of multilingual hubs serving major multinationals. In Spain, the renewed sales momentum observed at the beginning of the year continued during the second quarter, further attesting to the effectiveness of the previous two years’ action plans and investments.

The Group continues to benefit from the attractiveness of nearshore solutions in Mexico serving the US market, sometimes to the detriment of offshore solutions in the Philippines, and is expanding its presence in many different segments such as specialized retailing, food services, financial services and travel agencies. It is also benefiting from Mexico’s buoyant domestic market and the investments made in the country in recent years.

Growth in operations in Brazil and Argentina picked up pace during the period and performances remained satisfactory in Colombia.

The rapid ramp-up of operations in the Peruvian market, which the Group entered in 2017, also contributed to strong first-half business growth in the region.

To support this growth, new sites were opened during the first half, in Mexico and Portugal.

• Continental Europe & MEA

In the Continental Europe & MEA region, first-half 2018 revenue rose by + 14.5% like-for-like and by + 12.0% as reported, ending the period at €454 million. The negative currency effect stemmed mainly from the fall in the Egyptian pound, the Turkish lira and the Russian ruble against the euro.

The gains recorded in the three months to March 31, 2018 continued in the second quarter, with revenue growth for the quarter coming out at + 15.4%.

Business momentum remained strong in the region.

The solid performance posted in the first half confirms the acceleration of revenue growth observed in second-half 2017 and reflects a very good sales dynamic among global clients and fast-growing local market leaders in a wide range of industries. Revenues generated by the Group’s multilingual hubs in Greece and by operations in Egypt, Turkey and Eastern Europe (Russia, Poland and Romania) all rose sharply.

Operations in France reported healthy sales performances starting in the second quarter, particularly in domestic business, with new contracts signed primarily in the energy and online services segments.

Other growth drivers in the region included the resounding business recovery in Sweden and in Germany, with revenues reflecting the contribution of a new site in Kosovo serving the German market.

The fastest growing client segments in the region remained consumer electronics, leisure and entertainment, travel agencies, transportation and fast-moving consumer goods. The main revenue contributors, such as consumer electronics and financial services, continued to grow at a solid pace.

To support this growth, new sites were opened during the first half of 2018, in Russia and Poland.

• Specialized Services

Revenue from Specialized Services came in at €316 million in the first half of 2018. The business grew by + 5.7% like-for-like, but contracted by 4.1% as reported, due to the negative currency effect resulting mainly from the US dollar’s significant fall against the euro during the period. LanguageLine Solutions’ North American operations are a significant contributor to Specialized Services revenues.

Revenue rose by + 6.3% in the second quarter, representing a faster pace of growth than in the first three months of the year. Held back by non-recurring items in the first quarter of the year, growth in LanguageLine Solutions revenue returned to normal in the second quarter.

TLScontact continued to expand at a healthy pace in the first half of 2018, with growth slowing somewhat in the second quarter versus the first, despite a high basis of comparison for this period in 2017. Growth continued to be led by the satisfactory increase in visa application volumes on every government contract and by sales of add-on services during the visa issuance process.

The LanguageLine Solutions and TLScontact businesses account for around 80% of Specialized Services revenues.

FIRST-HALF 2018 RESULTS

EBITA before non-recurring items came to €246 million for the first half of 2018, virtually unchanged from the prior-year period (€245 million). EBITA margin before non-recurring items widened further, to 11.9% from 11.8% in first-half 2017, despite the decline of the US dollar against the euro which, in view of the currency mix, negatively impacted Group margins.

EARNINGS BY ACTIVITY

EBITA BEFORE NON-RECURRING ITEMS BY ACTIVITY

				H1 2018				H1 2017
€ millions
CORE SERVICES				152				147
% OF REVENUE				8.7%				8.4%
English-speaking market & Asia-Pacific				51				60
% of revenue				6.8%				7.4 %
Ibero-LATAM				60				55
% of revenue				10.8%				10.3 %
Continental Europe & MEA				19				11
% of revenue				4.2%				2.7 %
Holding companies				22				21
SPECIALIZED SERVICES				94				98
% OF REVENUE				29.6%				29.7 %
TOTAL				246				245
% OF REVENUE				11.9%				11.8%

• Core Services

In Core Services, EBITA before non-recurring items amounted to €152 million in the first half of 2018, compared to €147 million in first-half 2017. EBITA margin before non-recurring items stood at 8.7% versus 8.4% for the prior-year period.

This improvement essentially reflects a positive mix effect resulting from bullish growth in the Ibero-LATAM region, which was the Group's most profitable region in the half-year period, and the ongoing margin recovery for Continental Europe & MEA.

• English-speaking market & Asia-Pacific

The English-speaking market and Asia-Pacific region achieved EBITA before non-recurring items of €51 million in the first half of 2018, compared to €60 million in the prior-year period. EBITA margin before non-recurring items came to 6.8% versus 7.4% in first-half 2017.

The decline stemmed mainly from the Group’s offshore business in the Philippines, which remained subdued, particularly in the telecommunications segment, in favor of nearshore business in Mexico (Ibero-LATAM region).

The uncertain economic environment in the United Kingdom also dampened profitability in the industry.

Profitability progressed well in India and China, with the latter benefiting from the effective ramp-up during the period of recently opened sites.

In light of recently signed contracts, projects already underway and the non-recurrence of the negative effects felt in 2017, which continued during the first half but should ease in the coming quarters, the Group is confident that margins in the region will improve in the second half of 2018 versus the prior-year period.

• Ibero-LATAM

EBITA before non-recurring items in the Ibero-LATAM region amounted to €60 million in the first half of 2018, compared to €55 million in the same period in 2017.

EBITA margin before non-recurring items remained high, at 10.8%, representing a significant increase over the first half of 2017 (10.3%).

Growth in operations in Portugal and offshore Mexico was particularly robust and profitable during the period, while operating efficiency continued to improve steadily in Brazil, Argentina and Spain.

The Group confirms its objective of a further improvement in margins across the region for the full year.

• Continental Europe & MEA

In the Continental Europe & MEA region, Teleperformance remained on the steady upward trend in profitability that began in 2012. EBITA before non-recurring items for the region came to €19 million, giving a margin of 4.2% versus 2.7% in the prior-year period. Positive factors contributing to this growth included:

• Continued vibrant business growth with global and premium clients in a number of countries in Southern and Eastern Europe, such as Greece with its highly efficient multilingual solutions, and Russia.
• Ongoing improvement in profitability in a number of countries, including France and the Nordics but also Germany and Italy, with the development of nearshore solutions that enhance the Group’s competitiveness in these markets.

The Group confirms its objective of improving the region’s margins further for full-year 2018.

• Specialized Services

In Specialized Services, EBITA before non-recurring items amounted to €94 million in the first half of 2018, compared to €98 million in first-half 2017. EBITA margin before non-recurring items remained virtually stable at 29.6%, versus 29.7% in the prior-year period.

The LanguageLine Solutions and TLScontact businesses, which account for around 80% of Specialized Services revenues, continued to post healthy margins in the first half of 2018.

Specialized Services margins are expected to remain high over the full year and should include Intelenet’s margins in the fourth quarter, after completion of the acquisition, which is scheduled to take place in September 2018.

OTHER INCOME STATEMENT ITEMS

Consolidated operating profit (EBIT) amounted to €190 million versus €191 million in first-half 2017. The currency effect had a negative impact of €16 million.

First-half 2018 EBIT reflects the amortization of intangible assets in an amount of €41 million, a €12 million accounting expense on performance share plans and the €3 million impact of other non-recurring items, which correspond to costs related to the Intelenet acquisition announced on June 14.

The financial result represented a net expense of €19 million, versus €25 million in 2017.

Income tax expense amounted to €48 million, corresponding to an effective tax rate of 27.8%, versus 29.5% in the prior-year period.

Net profit - Group share stood at €123 million for the period, up + 6.0% from the €116 million reported in first-half 2017. Diluted earnings per share came to €2.10, up + 6.1% year-on-year.

CASH FLOWS AND FINANCIAL STRUCTURE

Cash flow after interest paid and tax totaled €209 million versus €224 million in first-half 2017. The change in consolidated working capital requirement during the first half was an inflow of €28 million, versus €22 million in the prior-year period. This good performance reflects, in particular, the ongoing policy to improve the Group's liquidity.

Net capital expenditure amounted to €81 million, or 3.9% of revenue, versus €68 million and 3.3% in first-half 2017. The Group continued to invest in its future development in terms of both business and margin growth while maintaining strict financial discipline. It continues to open new facilities and extend its existing facilities in order to support its clients in all of their markets (see the "Recent developments" section).

In all, consolidated net free cash flow came to €156 million versus €178 million in the prior-year period.

Financial investments included transactions with minority shareholders for €14 million, corresponding to the acquisition of non-controlling interests in a Specialized Services subsidiary.

After taking into account €112 million in dividends, net debt stood at €1,308 million at June 30, 2018. The Group's financial structure therefore remains very solid, with equity of €1,958 million at June 30, 2018.

RECENT DEVELOPMENTS

• Extensions and new facilities

In the first half of 2018, Teleperformance continued to deploy its strategy of expanding worldwide by opening new facilities in:

• the English-speaking market & Asia-Pacific (India and Canada);
• the Ibero-LATAM region (Mexico and Portugal);
• the Continental Europe & MEA region (Russia and Poland).

The Group also increased the number of workstations at its existing facilities, in the English-speaking market & Asia-Pacific region (Canada and Indonesia), in the Ibero-LATAM region (Argentina, Brazil, Mexico, Peru, Portugal and Spain), and in Continental Europe & MEA (mainly Greece, Sweden, Egypt and Dubai).

In all, more than 6,300 new workstations were created during the first half.

• Announcement of the Intelenet acquisition*

Teleperformance announced on June 14, 2018 that it had entered into a definitive agreement to acquire Intelenet, a major provider of high-end omnichannel customer experience management, back office, human resources, and financial and administration services. The company has more than 110 blue chip clients worldwide, mostly in the English-speaking market, India and the Middle East.

Intelenet’s growth momentum is strongly positive. For the fiscal year ended March 31, 2018, the company posted revenue of US$449 million, up + 10% year on year, and EBITDA of US$83 million, representing 18.5% of revenue versus 17.4% the previous year.

The US$1.0 billion transaction will be fully financed through debt, including a €750 million bond issue carried out in late June. The acquisition is expected to close by September 30, 2018, subject to receipt of certain regulatory approvals and other customary closing conditions.

OUTLOOK

Teleperformance is raising its full-year 2018 like-for-like revenue growth objective from "more than + 6%” to "more than + 7.5%”.

The Group is also refining its target for EBITA margin before non-recurring items, which is now expected to be above 13.5% for the full year at constant scope of consolidation, and expects to continue generating robust cash flow.

In addition, the Group confirms its revenue and profitability targets for 2022: revenue of more than €6 billion and EBITA before non-recurring items of more than €850 million. The Group nonetheless expects to update its long-term targets on completion of the Intelenet acquisition, scheduled to take place in September 2018.

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DISCLAIMER

All forward-looking statements are based on Teleperformance management’s present expectations of future events and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. For a detailed description of these factors and uncertainties, please refer to the "Risk Factors” section of our Registration Document, available at www.teleperformance.com. Teleperformance undertakes no obligation to publicly update or revise any of these forward-looking statements.

RESULTS PRESENTATION AND DOCUMENTATION

A conference call and webcast will be held today at 6:30 PM CEST

The webcast will be available live or for delayed viewing at: http://teleperformance.webcast.ldvproduction.com/webcastlist.aspx?eid=155&lngid=en

The half-year financial report and presentation materials will be available after the conference call on www.teleperformance.com at: https://www.teleperformance.com/en-us/investor-relations/press-releases-and-documentation/financial-results

INVESTOR CALENDAR

Third-quarter 2018: Monday, November 12, 2018

* The press release announcing the agreement was published on June 14, 2018 and is available from the Teleperformance website (www.teleperformance.com)

ABOUT TELEPERFORMANCE

Teleperformance (TEP – ISIN: FR0000051807 – Reuters: ROCH.PA – Bloomberg: TEP FP), the worldwide leader in outsourced omnichannel customer experience management, serves companies and administrations around the world, with customer care, technical support, customer acquisition (Core Services), as well as with online interpreting solutions, visa application management services, data analysis and debt collection programs (Specialized Services). In 2017, Teleperformance reported consolidated revenue of €4,180 million (US$4,720 million, based on €1 = $1.13).

The Group operates 171,000 computerized workstations, with 223,000 employees across 350 contact centers in 76 countries and serving 160 markets. It manages programs in 265 languages and dialects on behalf of major international companies operating in a wide variety of industries.

Teleperformance shares are traded on the Euronext Paris market, Compartment A, and are eligible for the deferred settlement service. They are included in the following indices: CAC Large 60, CAC Next 20, CAC Support Services, STOXX 600, SBF 120, S&P Europe 350 and MSCI Global Standard. They also have been included in the Euronext Vigeo Eurozone 120 index since December 2015, with regard to the Group’s performance in corporate responsibility.

For more information: www.teleperformance.com

Follow us: Twitter @teleperformance

APPENDIX

CONSOLIDATED INCOME STATEMENT

€ millions

				1st ½ yr 2018				1st ½ yr 2017
Revenues				2,070				2,081
Other revenues				3				4
Personnel				(1,387)				(1,377)
External expenses				(353)				(369)
Taxes other than income taxes				(10)				(12)
Depreciation and amortization				(77)				(83)
Amortization of intang. assets acquired as part of a business combination				(41)				(45)
Share-based payments				(12)				(8)
Other operating income and expenses				(3)
Operating profit				190				191
Income from cash and cash equivalents				2				0
Interest on financial liabilities				(27)				(32)
Net financing costs				(25)				(32)
Other financial income and expenses				6				7
Financial result				(19)				(25)
Profit before taxes				171				166
Income tax				(48)				(49)
Net profit				123				117
Net profit - Group share				123				116
Net profit (loss) attributable to non-controlling interests								1
Basic earnings per share (in euros)				2,14				2,01
Diluted earnings per share (in euros)				2,10				1,98

CONSOLIDATED CASH FLOW STATEMENT

€ millions

Cash flows from operating activities				1st ½ yr 2018				1st ½ yr 2017
Net profit - Group share				123				116
Net profit attributable to non-controlling interests				0				1
Income tax expense (credit)				48				49
Net financial interest expense				16				29
Expense (income) without effect on cash				123				137
Income tax paid				(81)				(81)
Internally generated funds from operations				229				251
Change in working capital requirements				28				22
Net cash flow from operating activities				257				273
Cash flows from investing activities
Acquisition of intangible assets and property, plant and equipment				(82)				(68)
Proceeds from disposals of intangible assets and property, plant and equipment				1
Net cash flow from investing activities				(81)				(68)
Cash flows from financing activities
Acquisition/disposal of treasury shares				3				(1)
Change in ownership interest in controlled entities				(14)				(39)
Dividends paid to parent company shareholders				(107)
Dividends paid to minority shareholders				(5)
Financial interests paid/received				(20)				(27)
Increase in financial liabilities				798				1,106
Repayment of financial liabilities				(758)				(1,282)
Net cash flow from financing activities				(103)				(243)
Change in cash and cash equivalents				73				(38)
Effect of exchange rates on cash held				(19)				59
Net cash at January 1st				283				279
Net cash at June 30th				337				300

CONSOLIDATED BALANCE SHEET

€ millions

ASSETS				06.30.2018				12.31.2017
Non-current assets
Goodwill				1,714				1,676
Other intangible assets				927				946
Property, plant and equipment				416				423
Financial assets				45				43
Deferred tax assets				31				28
Total non-current assets				3,133				3,116
Current assets
Current income tax receivable				80				62
Accounts receivable – Trade				890				896
Other current assets				122				93
Other financial assets				37				38
Cash and cash equivalents				340				285
Total current assets				1,469				1,374
Total assets				4,602				4,490
EQUITY AND LIABILITIES				06.30.2018				12.31.2017
Shareholders' equity
Share capital				144				144
Share premium				575				575
Translation reserve				(134)				(165)
Other reserves				1,366				1,356
Equity attributable to owners of the company				1,951				1,910
Non-controlling interests				7				12
Total shareholder's equity				1,958				1,922
Non-current liabilities
Provisions				16				15
Financial liabilities				1,412				1,387
Deferred tax liabilities				224				234
Total non-current liabilities				1,652				1,636
Current liabilities
Provisions				52				52
Current income tax				91				90
Accounts payable – Trade				158				141
Other current liabilities				455				425
Financial liabilities				236				224
Total current liabilities				992				932
Total equity and liabilities				4,602				4,490

ALTERNATIVE PERFORMANCE MEASURES

Change in like-for-like revenue:

Change in revenue at constant exchange rates and scope of consolidation, corresponding to current year revenue - last year revenue at current year rates - revenue from acquisitions at current year rates / last year revenue at current year rates.

H1 2017 revenue				2,081
Currency effect				(170)
H1 2017 revenue at constant exchange rates				1,911
Like-for-like growth				158
Change in scope				1
H1 2018 revenue				2,070

EBITDA before non-recurring items or current EBITDA (Earnings before Interest, Taxes, Depreciation and Amortizations):

Operating profit before depreciation & amortization, amortization of intangible assets acquired as part of a business combination, goodwill impairment charges and non-recurring items.

				H1 2018				H1 2017
Operating profit				190				191
Depreciation and amortization				77				83
Amortization of intangible assets acquired as part of a business combination				41				45
Share-based payments				12				8
Other operating income and expenses				3				-
EBITDA before non-recurring items				323				328

EBITA before non-recurring items or current EBITA (Earnings before Interest, Taxes and Amortizations):

Operating profit before amortization of intangible assets acquired as part of a business combination, goodwill impairment charges and non-recurring items.

				H1 2018				H1 2017
Operating profit				190				191
Amortization of intangible assets acquired as part of a business combination				41				45
Share-based payment				12				8
Other operating income and expenses				3				-
EBITA before non-recurring items				246				245

Non-recurring items:

Principally comprises restructuring costs, incentive share award plan expense, costs of closure of subsidiary companies, transaction costs for the acquisition of companies, and all other expenses that are unusual by reason of their nature or amount.

Net free cash flow:

Cash flow generated by the business - acquisitions of intangible assets and property, plant and equipment net of disposals - financial income/expenses.

				H1 2018				H1 2017
Net cash flow from operating activities				257				273
Acquisition of intangible assets and property, plant and equipment				(82)				(68)
Proceeds from disposals of intangible assets and property, plant and equipment				1
Financial income/expense				(20)				(27)
Net cash flow from financing activities				156				178

Net debt:

Current and non-current financial liabilities - cash and cash equivalents

				06.30.2018				12.31.2017
Non-current liabilities
Financial liabilities				1,412				1,387
Current liabilities
Financial liabilities				236				224
Cash and cash equivalents				(340)				(285)
Endettement net ou dette nette				1,308				1,326

Diluted earnings per share:

Net profit attributable to shareholders divided by the number of diluted shares and adjusted

Diluted earnings per share is determined by adjusting the net profit attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding by the effects of all potentially diluting ordinary shares. These include convertible bonds, stock options and incentive share awards granted to employees when the required performance conditions have been met at the end of the financial year.

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N.B.: The half-year financial statements at June 30, 2017 and June 30, 2018 have been subject to review by the auditors.
A glossary of alternative performance indicators is included in the Appendix

View source version on businesswire.com: https://www.businesswire.com/news/home/20180726005618/en/