14th Jun 2018 09:30
LONDON (Alliance News) - AVEVA Group PLC on Thursday reported a 34% drop in annual profit on costs relating to its recent combination with the software arm of France's Schneider Electric SA and said that it is targeting to achieve GBP25 million in annualised cost savings by the end of the 2020 financial year.
The engineering and industrial software provider also said that the combination with Schneider's software business will lead to material revenue synergies over the medium term.
AVEVA and Schneider Electric in September 2017 reached an agreement to combine the AVEVA with Schneider's industrial software businesses, creating a company worth about GBP3 billion.
The combination, which was agreed after two previous failed attempts, saw Schneider Electric contribute software assets to AVEVA and make a GBP550 million cash payment to AVEVA shareholders in exchange for a 60% shareholding in the combined company.
For the year ended March 31, AVEVA recorded a combined group pro forma pretax profit of GBP64.6 million, down from GBP98.3 million, on a revenue of GBP704.6 million and GBP648.7 million, respectively.
Group profit, before tax and adjustments and on pro forma basis grew to GBP162.8 million from GBP152.4 million. The pro forma results include results for both heritage Schneider Electric Industrial Software Business and heritage AVEVA for the 12 months to March end, as well as for the comparative period.
Acquisition and integration costs totaled GBP29.5 million versus GBP600,000.
The heritage AVEVA business recorded 30% drop in annual pretax profit to GBP32.8 million from GBP46.9 million a year go, on a revenue of GBP248.2 million and GBP215.8 million, respectively. Adjusted earnings before interest and taxes, however, rose 24% to GBP67.6 million from GBP54.6 million.
The heritage Schneider software posted pretax profit of GBP31.8 million, down from GBP51.4 million, on a revenue of GBP456.4 million and GBP4332.8 million, respectively. Adjusted earnings before interest and taxes rose to GBP98.0 million from GBP97.3 million.
On a statutory basis, pretax profit fell 8.8% to GBP46.9 million from GBP51.4 million, on a revenue of GBP499.1 million and GBP432.8 million, respectively. Statutory results include results for heritage Schneider Electric Industrial Software Business for the 12 months to March 31 and results for heritage AVEVA for one month to March-end.
"In the current year, we are focused on integrating the businesses whilst driving performance through improved execution. In the medium-term we expect to drive stronger growth assisted by the positive trend of the ongoing digitalisation of industry, an optimisation of our products and go-to-market strategies, and capitalising on the synergies outlined above," AVEVA Group Chief Executive Craig Hayman said.
AVEVA maintained its final dividend at 27.0 pence per share, following GBP10.15 per share cash return of value to AVEVA shareholders in March, which had taken the place of an interim dividend.
Shares in AVEVA were up 12% at 2,836.00 pence each in morning trade.
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