2013 ALTEN half year financial report by ALTEN_Publications

2013 half year financial report

ALTEN, a French société anonyme (joint stock company) with equity of 33,277,563.71 Euros Head office: 40 avenue André Morizet - 92100 Boulogne Billancourt Listed in the Nanterre Trade and Companies Register under No. 348 607 417

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Contents

2013 half year financial report ............................................................................................................. 3 1.

ACTIVITY REVIEW .............................................................................................................................................. 3

FINANCIAL REVIEW .......................................................................................................................................... 4

RELATED PARTY TRANSACTIONS .................................................................................................................... 5

EVENTS SINCE 30 JUNE 2013 ........................................................................................................................... 5

MAIN RISKS AND UNCERTAINTIES IN THE SECOND HALF OF 2013 ............................................................. 5

OUTLOOK .......................................................................................................................................................... 5

Consolidated half-year accounts................................................................................ ..................... 7 Statutory Auditors' report on half-year financial information.................... .................................. . 38 Declaration by the person in charge of the half-year financial report................. ..................... . 39

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2013 half year financial report 1. ACTIVITY REVIEW 1.1. Alten activity: ALTEN is European leader in Engineering and Technology Consulting. The Group carries out design and research projects for the Technical and Information Systems divisions of major customers in the industrial, telecoms and service sectors. Alten operations are divided into two business lines: 路

Technology Consulting and Engineering (TCE), which accounts for 71% of revenues

路

Information systems, Networks and Telecoms (SIRT) activity which accounts for 29% of revenues.

At the end of June 2013 Alten had 15,790 staff members, of whom 88% are high-level engineering consultants. Alten generated 62.2% of its business in France and 37.8% internationally, primarily in Europe. 1.2. Highlights in the first half of 2013: Alten activity remained dynamic in the first half of the year despite a contracting market. Activity increased by 2.5% in the first half of 2013 (-0.3% in France; +7.6% outside France). On a like-for-like basis and despite two fewer business days than in the first half of 2012, activity increased by 1.6% (-0.3% in France; +5% outside France). Organic growth would have amounted to +3.4% on a like-for-like basis regarding the number of business days. Aerospace, Energy and Rail remained the most dynamic sectors. Internationally, activity growth (+5% on a like-for-like basis) was driven primarily by Germany (+23.1%) and Italy (+11.8%). In contrast, Belgium, Spain, the Netherlands and Sweden posted a contraction compared to the first half of 2012. In Spain the significant downturn posted in the first two quarters (-15%) can be attributed to the sharp drop in public sector business, even though engineering activity posted an increase.

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2. FINANCIAL REVIEW The consolidated accounts presented in this document were approved by the Board of Directors at its 24 September 2013 meeting. 2.1. Income statement (IFRS): Revenue Revenue amounted to €613.8 M compared to €598.7 M at 30 June 2012, i.e., a 2.53% increase. On a like-for-like basis, activity increased by 1.61%: - 0.3% in France and +5% internationally. The first half of 2013 had two fewer business days than the same period in 2012. Organic growth would have amounted to 3.4 % on a like-for-like basis regarding the number of business days. Operating Profit on Activity Operating profit amounted to €53.8 M, i.e., 8.8% of revenue compared to €59 M, i.e., 9.9% of revenue in June 2012. In France the operating margin on activity posted a slight contraction from 8.4% of revenue in June 2012 to 7.6% of revenue in June 2013. The contraction can be attributed primarily to the fewer number of business days (-2) and an increase between contracts that was partially offset by CICE. Internationally, the operating margin on activity posted a slight contraction from 12.5% of revenue at 30 June 2012 to 10.7% of revenue at 30 June 2013. The adverse calendar effect which also affected international activity, along with the drop in revenue in some countries, caused profitability to fall. Operating income from ordinary activities Operating income amounted to €53.8 M after factoring in payments in shares. Operating income After booking non-recurring income, operating income amounted to €54 M, i.e., 8.8% of revenue. Net earnings, Group share After deduction of the financial result of €-0.7 M, of the tax burden of €18 M and the results of equity-method companies, net earnings, Group share, amounted to €36.2 M, i.e., 5.8% of revenue, a 6.4% contraction compared to the previous year(€38.7 M). 2.2. Consolidated balance sheet items and financial movements The financial structure of the Alten Group is very robust and has not changed compared to June 2012. Under assets, non-current assets amounted to 33% of the overall balance sheet, consisting primarily of goodwill (24.6%). Current assets excluding cash assets consisted primarily of accounts receivable and trade notes, which amounted to 57% of the balance sheet. Under liabilities, the group had significant shareholder equity (€456.7 M) amounting to 56.6% of the overall balance sheet. The group has no debt. After payment of dividends amounting to €32.2 M, the group has net cash assets of €50.6 M. The group's gearing (net debt / equity ratio) amounted to -11%. Alten therefore complied with all of its bank covenants.

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In the first half of 2013 the Alten group generated cash flow of €56.9 M, a 6.3% contraction compared to the previous year (€60.6 M). The DSO ratio in the first half of the year contracted from 102 days at the end of June 2012 to 100 days at the end of June 2013. Free cash flow amounted to €26.5 M, i.e., 4.3% of revenue. Cash asset production therefore remained satisfactory despite adverse seasonal factors affecting activity at the end of June. Treasury movements on investments amounting to €- 7 M concerned primarily the financing of: ·

Tangible and intangible fixed assets (fittings, software licenses) amounting to €– 6.3 M

Financial fixed assets (securities and collateral; AFS stock) amounting to €– 14 M

External growth and additional costs on acquisitions totalling €83,000.

Treasury movements on financing operations amounted to €– 7.5 M and consisted primarily of the payment of dividends totalling €32.2 M financed by the use of current financial liabilities (€18.4 M) and capital increases from the exercise of stock options (€6.8 M). Consequently, net cash asset variation amounted to €11.5 M according to IFRS. Net cash assets at 30 June 2013 amounted to €50.6 M (€17.4 M at 30 June 2012). 3. RELATED PARTY TRANSACTIONS There were no related party transactions in the first half of 2013. 4. EVENTS SINCE 30 JUNE 2013 -

On 17 July 2013 Alten Europe acquired the Belgian company Quasus and its subsidiary in the Netherlands. The Belgian group specialises in business process management, IT project management and IT testing. It has 115 consultants (110 in Belgium and five in the Netherlands). The acquisition makes it possible for the Alten group to consolidate its presence on the Belgian market in particular thanks to synergies with Alten Belgium (€13 M revenue, 115 engineers).

On 24 July 2013 Alten SA acquired the ADDS group, which specialises in life sciences. The ADDS group comprises several companies owned by ADDS Group SAS (2012 revenue: €3.2 M - 30 consultants).

5. MAIN RISKS AND UNCERTAINTIES IN THE SECOND HALF OF 2013 The type and severity of risks incurred by the group have not changed in relation to the risk factors outlined on pages 86 to 89 of the 2012 reference document filed with Autorité des Marchés Financiers on 26 April 2013.. Developments in the economic climate and in particular its impact on activity rates as well as the group's recruitment ability are among the main factors which may affect the business market in the second half of the year. 6. OUTLOOK The European technology consulting market has probably contracted in the first half of 2013 (a contraction in France, BENELUX and Spain), but should resume growth in the second half of the year. Action plans to make the most of the economic recovery at the end of 2013 and in 2014 have been implemented in this semester.

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Between contract contraction and expected improvement in operating margin in the second half of the year.

Alten is optimistic about its continued growth: France: moderate growth with a significant recovery from the second half of 2013 onwards, Internationally: more dynamic organic and external growth.

Challenges will concern: Optimising management of trans-national projects Achieving critical mass (1,500 people) in eastern European countries Implementing targeted, accretive external growth operations.

Boulogne Billancourt, 08 October 2013 The Board of Directors

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ALTEN GROUP

HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS .......................................................................................... 8 1.1 1.2 1.3 1.4 1.5

CONSOLIDATED FINANCIAL STATEMENTS ............................................................................................................... 9 CONSOLIDATED INCOME STATEMENT ................................................................................................................... 10 STATEMENT OF COMPREHENSIVE INCOME ........................................................................................................... 11 CONSOLIDATED CASH FLOW STATEMENT ............................................................................................................. 12 CHANGE IN CONSOLIDATED SHAREHOLDERS’ EQUITY ........................................................................................ 13

NOTE TO THE HALF-YEAR CONDENSED CONSOLIDATION FINANCIAL STATEMENTS ................................... 15 2.1 2.2 2.2.1 2.2.2 2.2.3 2.2.4 2.2.5 2.2.6 2.3 2.3.1 2.3.2 2.4 2.5 2.6

Consolidated financial statements at 30 June 2013

GENERAL INFORMATION ON THE GROUP ............................................................................................................. 16 HALF-YEAR KEY EVENTS ........................................................................................................................................... 16 BUSINESS ................................................................................................................................................................. 16 LEGAL REORGANISATIONS .......................................................................................................................................... 16 CREATIONS ............................................................................................................................................................. 16 DIVIDENDS .............................................................................................................................................................. 17 OTHER INFORMATION ................................................................................................................................................ 17 POST-CLOSING EVENTS .............................................................................................................................................. 17 ACCOUNTING POLICIES ......................................................................................................................................... 18 MANAGEMENT ESTIMATES .......................................................................................................................................... 18 TRANSLATION RATES .................................................................................................................................................. 19 CHANGE OF METHOD ............................................................................................................................................ 20 FINANCIAL RISK FACTORS ...................................................................................................................................... 21 SCOPE OF CONSOLIDATION .................................................................................................................................. 22

DETAIL OF THE CONSOLIDATED FINANCIAL STATEMENTS .................................................................................. 23 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 3.22

GOODWILL .............................................................................................................................................................. 24 NON-CURRENT ASSETS AND AMORTISATION ........................................................................................................ 26 EQUITIY-ACCOUNTED STAKES ................................................................................................................................ 27 FINANCIAL ASSETS................................................................................................................................................... 27 CURRENT ASSETS ..................................................................................................................................................... 28 CASH AND CASH EQUIVALENTS............................................................................................................................. 29 NON-CURRENT FINANCIAL LIABILITIES ................................................................................................................... 29 OTHER NON-CURRENT LIABILITIES ........................................................................................................................... 29 CURRENT FINANCIAL LIABILITIES ............................................................................................................................. 29 OTHER CURRENT LIABILITIES .................................................................................................................................... 30 PROVISIONS ............................................................................................................................................................ 30 PAYROLL EXPENSES ................................................................................................................................................. 31 OTHER OPERATING INCOME AND EXPENSES ........................................................................................................ 31 OTHER NON-CURRENT OPERATING INCOME AND EXPENSES .............................................................................. 31 NET FINANCIAL INCOME ........................................................................................................................................ 32 BREAKDOWN OF INCOME TAX EXPENSES ............................................................................................................. 33 OPERATING SEGMENTS .......................................................................................................................................... 34 EARNING PER SHARE............................................................................................................................................... 35 CASH FLOW STATEMENT ......................................................................................................................................... 36 CONTINGENT ASSETS AND LIABILITIES .................................................................................................................... 37 RELATED PARTY TRANSACTIONS ............................................................................................................................ 37 FINANCIAL COMMITMENTS .................................................................................................................................... 37

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1. HALF-YEAR CONSOLIDATED FINANCIAL STATEMENTS

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1.1 CONSOLIDATED FINANCIAL STATEMENTS (In thousands of euros)

ASSETS

Notes

2013-06-30

2012-12-31

updated version

published version

Goodwill

3.1

199,662

200,572

Intangible assets

3.2

9,466

10,053

Property, plant and equipment

3.2

15,832

14,061

Equity-accounted stakes

3.3

5,773

4,717

Non-current financial assets

3.4

27,984

26,827

7,745

9,942

10,192

266,462

266,172

266,422

Tax credits NON-CURRENT ASSETS Trade receiv ables

3.5

418,949

402,753

Other current assets

3.5

43,888

40,664

Cash and cash equiv alents

3.6

78,067

66,523

CURRENT ASSETS

540,904

509,941

TOTAL ASSETS

807,366

776,113

776,363

LIABILITIES

Notes

2013-06-30

2012-12-31 updated version

2012-12-31 published version

Share capital

33,277

32,953

Additional paid-in capital

31,811

25,443

Consolidated reserv es

355,453

310,641

310,091

Consolidated earnings

36,194

78,160

78,168

EQUITY (GROUP SHARE)

456,735

447,197

446,655

996

456

453

457,731

447,652

447,107

MINORITY INTERESTS TOTAL SHAREHOLDERS'EQUITY

32,953

Prov isions

3.11

13,487

12,630

13,424

Non-current financial liabilities

3.7

530

1,517

Other non-current liabilities

3.8

4,891

5,487

18,908

19,633

20,428 6,496

NON-CURRENT LIABILITIES Prov isions

3.11

4,143

6,496

Current financial liabilities

3.9

27,218

7,936

36,904

38,100

262,462

256,296

CURRENT LIABILITIES

330,728

308,828

TOTAL LIABILITIES

807,366

776,113

776,363

Trade payables Other current liabilities

3.10

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1.2 CONSOLIDATED INCOME STATEMENT

(In thousands of euros)

REVENUE Purchases consumed Payroll expenses External charges Taxes other than on income Depreciation and amortization Other operating expenses Other operating income

Notes

3.17

3.12

3.13 3.13

OPERATING PROFIT ON ACTIVITY Share-based payments PROFIT FROM ORDINARY ACTIVITIES Non-current operating expenses Non-current operating income

3.14 3.14

OPERATING PROFIT Net costs of financial debt Other financial expenses Other financial income Income tax expense

3.15 3.15 3.15 3.16

CONSOLIDATED NET EARNINGS Earnings of equity-accounted companies

3.3

NET OVERALL EARNINGS

2013-06-30

2012-06-30 (*)

613,795

598,654

(47,942) (443,935) (60,243) (3,433) (5,247) (2,454) 3,243

(47,596) (427,991) (57,639) (3,531) (3,677) (3,628) 4,411

53,784

59,003

(193)

53,808

58,810

(1,604) 1,783

(1,483)

53,987

57,327

(258) (2,311) 1,823 (17,947)

(258) (1,734) 1,918 (19,264)

35,294

37,989

1,044

819

36,338

38,807

144

36,194

38,732

Of which: Minority interests Group share Earnings per share in euros (Group share)

3.18

1.12

1.22

Diluted earnings per share in euros (Group share)

3.18

1.11

1.21

(*) As the impact of the change in method relating to the application of IAS 19 (amended) has no significance for the presentation of the income statement, comparative information has not been restated.

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1.3 STATEMENT OF COMPREHENSIVE INCOME

2013-06-30

(In thousands of euros)

2012-06-30 (*)

Net income, Group share Earnings attributable to minority interests

36,194 144

38,732 75

Consolidated net earnings

36,338

38,807

Change in fair value of sellable financial assets Translation adjustments

623 (857)

(381) 168

Income and expenses booked directly under equity

(234)

(213)

TOTAL INCOME FOR THE PERIOD

36,104

38,594

Of which: Group share Minority interests

35,960 144

38,519 75

(*) As the impact of the change in method relating to the application of IAS 19 (amended) has no significance for the presentation of the overall result statement, comparative information has not been restated.

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1.4 CONSOLIDATED CASH FLOW STATEMENT (In thousands of euros)

Notes

Consolidated net earnings

2013-06-30

2012-06-30

36,338

Earnings of equity-accounted companies Depreciation, amortization and operating prov isions

(1,044)

(819)

3.19

3,386

2,888

(24)

193

3.16

17,947

19,264

3.15

258

Share-based payments Income tax expenses Capital gains or losses from disposals Cost of net financial indebtedness

38,807

3.3

Financial cost on update and prov isions

Gross cash flow before borrowing costs and tax

56,882

60,611

Taxes paid

3.19

(23,007)

(14,582)

Change in working capital requirements

3.19

(7,315)

(16,382)

Net cash flow from operating activities

26,560

29,647

Acquisitions of tangible and intangible assets

(6,278)

(4,832)

Acquisitions of financial assets

(1,366)

(3,143)

(16,096)

Impact of changes in scope and earn-outs

3.19

Disposals of tangible and intangible assets Reductions in financial assets Net cash flow from investing activities Net financial interest paid Div idends paid to shareholders Capital increase

3.19

Acquisition and disposals of treasury shares

511

853

(7,038)

(23,195)

(259)

(245)

(32,262)

(31,823)

6,770

705

(87)

(948)

(85)

Change in current financial liabilities

19,295

32,118

Net cash flow from financing activities

(7,491)

677

(487)

233

11,544

7,362

Repayment of long-term financial debt

Effect of changes in exchange rates on cash Change in cash position Opening cash

3.6

66,523

59,614

Cash at end of period

3.6

78,067

66,976

11,544

7,362

Change

In accordance with IAS 7 identifying bank borrowings and loans with financing activities, the table below shows the change in positive cash flow items (see note 3.6). The Groupâ&#x20AC;&#x2122;s net cash position breaks down as follows: (In thousands of euros)

2013-06-30

2012-06-30

Cash at end of period

78 067

66 976

Bank ov erdrafts

(6 496)

(6 240)

(20 932)

(43 307)

50 639

17 429

Bank loans Net cash position

ALTEN GROUP

Consolidated financial statements at 30 June 2013

1.5 CHANGE IN CONSOLIDATED SHAREHOLDERSâ&#x20AC;&#x2122; EQUITY (In thousands of euros) Number of shares in circulation

At 31 December 2011 (published version)

31,795,425

Number of shares issued

32,271,677

Capital

Additional paid-in capital

32,801

22,708

Change in revised IAS 19 method At 31 December 2011 (updated version) 2011 allocation of earnings Capital increase (1)

31,795,425

32,271,677

32,801

22,708

Translation reserve

(9,020)

962

291,144

(9,019)

962

59,536 38,350

38,350

Earnings (Gp share)

Shareholders' equity

59,552

398,837

(16)

(705)

59,536

398,132

(59,536)

0 705

666 (31,823)

Other variations (2)

(31,823)

(621) 2,381

(621) 8

Share-based payments Transactions with shareholders

291,834

Treasury shares

(690)

Dividends paid to shareholders

Treasury shares

Reserves

193 40,731

38,350

666

Total income for the period

27,285

193 8

(775)

185

Earnings attributable to minority interests Profit and income and expenses in shareholders'equity

(775)

Change in method

185

628

(59,536)

(31,538)

78,168

77,578

1,689

78,168 (4)

77,578 0 625

At 30 June 2012 (updated version)

31,836,252

32,312,408

32,840

23,374

318,283

(9,011)

1,147

78,165

444,796

At 31 December 2011 (updated version)

31,795,425

32,271,677

32,801

22,708

291,144

(9,019)

962

59,536

150,076

153

2,734

398,132 0 0 2,887

2011 allocation of earnings Capital increase (1)

59,536

Dividends paid to shareholders

(31,823)

Other variations (3) Treasury shares

(31,823)

(933) (1,768)

(933) (172)

Share-based payments Transactions with shareholders

(59,536)

(172)

279 148,308

150,076

153

2,734

Total income for the period

27,059

279 (172)

(59,536)

(29,762) 77,578

(775)

185

78,168 1,689

1,689

(775)

185

78,168

77,578

(7)

1,249

78,161

447,197

(78,161)

0 6,693

Earnings attributable to minority interests Profit and income and expenses in shareholders'equity 1,256 Change in method At 31 December 2012 (updated version) 2012 allocation of earnings Capital increase (1)

31,943,733

32,421,753

32,954

25,442

318,894

324

6,369

1,147

(32,262)

Other variations (3)

(32,262)

(743) (3,090)

(743) (86)

Share-based payments Transactions with shareholders

(9,191)

78,161

Dividends paid to shareholders

Treasury shares

318,685

(86)

(24) 32,259,537

32,740,647

33,278

31,811

Total income for the period

363,817

(24) (9,277)

623

1,147

420,775

(857)

36,194

35,960

1,044

(857)

36,194

35,960

290

36,194

456,735

Earnings attributable to minority interests Profit and income and expenses in shareholders'equity At 30 June 2013

623 32,259,537

32,740,647

33,278

(1) Capital increases linked to the exercising of stock-options. (2) Effect of scope changes (â&#x201A;Ź 830,000) and reclassifications. (3) Effect of scope changes involving Anotech Energy France, Anotech Energy UK and Atexis Spain (only in 2012).

31,811

364,440

(9,277)

ALTEN GROUP

Consolidated financial statements at 30 June 2013

Change in shareholders' equity, minority interest share (in thousands of euros)

Reserves

At 31 December 2011 2011 allocation of earnings Change in scope (1)

Earnings

427

(38)

Shareholders' equity

(205)

Total income for the period

466

(205)

Change in revised IAS 19 method At 30 June 2012

261

336

At 31 December 2011

427

466

(38)

2011 allocation of earnings Change in scope (1)

(248)

2012 earnings

(248) 234

Change in revised IAS 19 method

234 4

At 31 December 2012 (updated version)

221

234

456

2012 allocation of earnings

234

(234)

Change in scope (2)

324

Capital increase Total income for the period At 30 June 2013

851

144

996

(1) In 2012, the change in scope related to the subscription of minority interests in the capital of ANOTECH ENERGY France, ANOTECH ENERGY UK and ATEXIS SPAIN. (2) In 2013, the change in scope related to the buyout of minority interests in ITEKNA, ANOTECH ENERGY France and ANOTECH ENERGY UK.

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2. NOTE TO THE HALF-YEAR CONDENSED CONSOLIDATION FINANCIAL STATEMENTS

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2.1 GENERAL INFORMATION ON THE GROUP The Alten group is the European leader in the Engineering and Technology Consulting (ETC) market. The parent company ALTEN is a joint stock company with a board of directors subject to French law and leads the group of companies. Its head office is located at 40 avenue André Morizet in Boulogne Billancourt (92513). The company was established on 28 October 1988 with a legal term of 99 years. ALTEN carries out design and research projects for the Technical and Information Systems divisions of major customers in the industrial, telecoms and service sectors. Operations are divided into two business lines: Technology Consulting and Engineering (71% of revenue) and Information Systems, Networks and Telecoms (29% of revenue). ALTEN works with its customers through various types of packages: in consulting mode in “work package” mode or in “globalised platforms” (most of these services are rendered with a best effort undertaking and are invoiced according to time spent; fixed-rate projects by which Alten is bound by a results commitment at a fixed rate account for less than 10% of activity).

ALTEN has been ISO certified since 1998 and has applied a structural program to the group in particular in implementing CMMI certification processes, strengthening the Structured Projects division with by centres of competencies and systematic training for experienced managers and consultants in “structured project” management. ALTEN has been CMMI 3 level d since 2012. The condensed consolidated accounts presented in this document were approved by the Board of Directors at its 24 September 2013 meeting. Unless stated otherwise, accounts have been drawn up in thousands of Euros. Issuer consolidated accounts have been disclosed in the public area of its website dedicated to users of financial statements: www.ALTEN.fr/finance/informations-financieres-ALTEN.htm.

2.2 HALF-YEAR KEY EVENTS 2.2.1

Business

Activity rose by 2.5% compared to June 2012. On a like-for-like basis and despite 2.3 fewer working days compared to the first half of 2012, activity increased by 1.6% (-0.3% in France; +5% abroad). Organic growth would have amounted to 3.4% on a like-for-like basis regarding the number of working days. The main sectors driving growth were Aeronautics, Space and Defence (25.3% of revenue) and Energy and Life Sciences (19.7% of turnover). Originators continued their policy of streamlining approved supplier lists based on (i) multiple competencies and offers in engineering, (ii) the ability to manage global projects and ensure productivity gains, (iii) an international presence and access to offshore / nearshore services.

2.2.2

Legal reorganisations

The group implemented the following changes in legal structure in the first half of the year: In France ALTEN SA merged the assets of the B2I company to absorb it. In Sweden X DIN Oresund, X DIN Linkoping and X DIN Stockolm were merged into X DIN AB.

2.2.3

Creations

In Spain MI GSO Expertos en Management de Proyetos was established and is wholly-owned by MI GSO SAS. In the United Kingdom Alten Technology Limited was established and is 70% owned by Alten Europe. X DIN AS was established in Norway in April 2013.

ALTEN GROUP

2.2.4

Consolidated financial statements at 30 June 2013

Dividends

During the first half of 2013 €32.3 million of dividends were paid to ALTEN SA shareholders in respect of financial year 2012.

2.2.5 -

An URSSAF audit for ALTEN SA concerning the 2011 and 2012 financial years began at the start of 2013.

2.2.6 -

Other information

Post-closing events

A tax audit concerning ALTEN SA for the 2010, 2011 and 2012 financial years began in July 2013 In Belgium, a technology consulting company was acquired (2012 revenue: €13 M - 115 consultants) Acquisition in Belgium and France of a company specialising in Life Sciences (2012 revenue: €3.2 M - 30 consultants).

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2.3 ACCOUNTING POLICIES The accounting principles and calculation methods used to draw up the consolidated accounts at 30 June 2013 were the same as those used for the consolidated accounts at 31 December other than the specific provisions stipulated in IAS 34 “Interim Financial Reporting”. The interim financial statements therefore do not include all the requisite information and must be read with reference to the consolidated accounts for the year ending 31 December 2012. The accounting principles and methods used by the ALTEN group for its half-year consolidated financial statements are the same as those used in annual consolidated financial statements for the year ending 31 December 2012. The Group did, however, apply the new mandatory standards and interpretations effective 1 January 2013 to the accounts at 30 June 2013. Only the application of IAS 19 revised “Employee Benefits” had an impact on consolidated accounts. The impact is outlined in section 2.4 – change in method. New mandatory standards and interpretations applicable for the first time by the Group are as follows:

Applicable dates: financial years starting 01 January 2013

Standards, amendments or interpretations Rev ised IAS 19- employee benefits Amendement to IAS 1 "Presentation of items of other

01 July 2012

comprehensiv e income (OCI)" Annual improv ements (2009-2011)

01 January 2013

Amendement to IFRS 7 - Disclosure - Offsetting

01 January 2013

financial assets and financial liabilities"

The ALTEN Group did not apply in advance the latest standards, amendments and interpretations already published by IASB and adopted at European level for which application was not compulsory on 1 January 2013.

2.3.1

Management estimates

The preparation of financial statements in accordance with IFRS standards requires that certain estimates and assumptions be made which may affect the amounts shown in the financial statements. These estimates and assessments are continuously made on the basis of past experience and other factors considered reasonable. The main estimates made by management in drawing up the consolidated position are stated in the 2012 reference document on page 170. The current, rapidly changing economic climate makes an understanding of the outlook for the group's activity more complex; the uncertainty inherent in some estimates may be amplified, particularly with regard to forecasts of results and treasury movements.

ALTEN GROUP

2.3.2

Consolidated financial statements at 30 June 2013

Translation rates

Foreign currency translation rates are given below:

2013-06-30 Country

Currency

Average price

2012-06-30

Price at year-

Average

2012 financial year Average

CHF 1 = EUR

0.813107

Great Britain

GBP 1 = EUR

1.174853

1.166589

1.215805

1.239465

1.232878

1.225340

Romania

RON 1 = EUR

0.22767

0.2242

0.227770

0.224653

0.224313

0.224997

United States

USD 1 = EUR

0.761342

0.764526

0.771129

0.794281

0.777847

0.757920

Poland

PLN 1 = EUR

0.239343

0.230542

0.235610

0.235361

0.238986

0.245459

Czech Republic

CZK 1 = EUR

0.038914

0.038537

0.039732

0.039002

0.039768

0.039760

Sweden

SEK 1 = EUR

0.117238

0.11393

0.112594

0.113989

0.114854

0.116523

India

INR 1 = EUR

0.01383

0.012867

0.014791

0.014261

0.014571

0.013782

Brazil

BRL 1 = EUR

0.3747

0.346033

0.414062

0.387777

0.398451

0.369877

Nigeria

NGN 1 = EUR

0.004806

0.004729

0.004782

0.004853

0.004878

0.004855

China

CNY 1 = EUR

0.123011

0.124564

0.124579

0.121644

Hong Kong

HKD 1 = EUR

0.098128

0.098544

0.101207

0.097790

Canada

CAD 1 = EUR

0.749327

0.729182

0.778220

0.761209

Norway

NOK 1 = EUR

0.132937

0.126831

end 0.831255

price 0.829655

Price at year-

end 0.810504

Switzerland

price 0.830013

Price at year-

end 0.828363

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2.4 CHANGE OF METHOD The group has applied the IAS 19 revised “Employee Benefits” standard since 1 January 2013. In accordance with IAS 8 “Accounting Policies, changes in accounting estimates and errors”, the accounts for the financial year ending 31 December 2012 were restated as if the standard had been applied at 1 January 2012. The impact of this change in method is outlined below: 2012-12-31 ASSETS (in thousands of euros)

Goodwill

(published version)

2012-12-31

change of method

(updated version)

200,572

Intangible assets

10,053

Property, plant and equipment

14,061

Equity-accounted stakes

4,717

Non-current financial assets

26,827

Tax credits

10,192

-250

9,942

NON-CURRENT ASSETS

266,422

-250

266,172

Trade receiv ables

402,753

Other current assets

40,664

Cash and cash equiv alents

66,523

CURRENT ASSETS

509,941

TOTAL ASSETS

776,363

-250

776,113

LIABILITIES (in thousands of euros)

Share capital Additional paid-in capital

2012-12-31 (published version)

2012-12-31 (updated version)

change of method

32,953

25,443

Consolidated reserv es

310,091

550

310,641

Consolidated earnings

78,168

-8

78,160

EQUITY (GROUP SHARE)

446,655

542

447,197

453

456

447,107

545

447,652

13,424

-795

12,630

MINORITY INTERESTS TOTAL SHAREHOLDERS'EQUITY Prov isions Non-current financial liabilities

1,517

Other non-current liabilities

5,487

NON-CURRENT LIABILITIES

20,428

-795

19,633

CURRENT LIABILITIES

308,828

TOTAL LIABILITIES

776,363

-250

776,113

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2.5 FINANCIAL RISK FACTORS

Liquidity risk

A prudent liquidity management plan involves keeping a sufficient level of liquid assets, having financial resources through appropriate credit facilities and being able to settle one's positions on the market. The Group maintains financial flexibility through €170 million of available, confirmed but unused credit facilities (at financial year end) of which €150 million was confirmed in December 2012 under the “club deal” for a maximum period of three years, and €21.5 million of short-term unconfirmed lines of credit that are renewable annually.

The club deal imposes the follow ratios which must be complied with every six and twelve months (and for the first time at 30 June 2013) for as long as the contract is in effect and advances are in use: -

Ratio 1 - "Consolidated net financial debt / Operating income from consolidated activity". This ratio must be less than 2.1. Ratio 2 - “Consolidated net financial debt / Improved Shareholder Equity”. This ratio must be less than 0.7.

At 30 June 2013, these banking ratios were adhered to.

Credit risk

Credit risk is the financial loss risk in the event that a customer fails to honour its contractual obligations. The group does not have any major concentration of credit risks. See note 3.5 Current assets – breakdown of the accounts receivable portfolio by account age.

Interest rate variation risks

The interest rate risk to which the group is exposed arises from the club deal implemented in December 2012 and which is indexed to Euribor for the interest period in question. It therefore incurs an exchange rate risk based on changes in the reference index. Due to the structure of its financing, the Group has not implemented interest rate hedging. At 30 June 2013 the credit line was exercised to the extent of €20 M.

Exchange risks

Most operations are implemented within each domestic market, which means that the exchange risk affecting movements between different currency zones remains limited. As the risk is limited, the group has not implemented exchange risk hedging.

ALTEN GROUP

Consolidated financial statements at 30 June 2013

2.6 SCOPE OF CONSOLIDATION

The percentage of interests and control set forth below include firm or conditional commitments to dispose of minority interests, even if the disposals are not yet completed, in accordance with IFRS-3 and IAS 27 as revised.

France Basis of consolidation (*)

% d'interest

% control

FC FC FC FC FC FC FC FC FC FC FC FC FC FC FC FC FC

100.00 99.70 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 51.00 100.00 80.00

Basis of consolidation (*)

% d'interest

% control

Country of operation

ANOTECH ENERGY UK

100.00

Great Britain

ALTEN LTD

100.00

Great Britain

MI-GSO LTD

100.00

Great Britain

ALTEN TECHNOLOGY LTD

70.00

Great Britain

ALTEN BELGIUM ALTEN SPAIN ATEXIS SPAIN MI GSO EMP SPAIN ALTEN NEDERLAND ALTEN DDA ORION ELITYS SWITZERLAND SA ALTEN SWITZERLAND SARL ALTEN CONSULTING SARL ALTEN ITALIA MI-GSO GMBH ALTEN TECHNOLOGY GMBH ATEXIS GMBH

FC FC FC FC FC FC FC FC FC FC FC FC FC FC

100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

Belgium Spain Spain Spain The Netherlands The Netherlands The Netherlands Switzerland Switzerland Switzerland Italy Germany Germany Germany

ALTEN GMBH

100.00

Germany

BARDENHEUER IMP POLAND ITEKNA POLSKA ALTEN SI TECHNO ROMANIA ATEXIS SRL X DIN AB X-DIN INC X-DIN AS ALTEN INDIA CALSOFT LABS INDIA CALSOFT LABS INC. (USA) ANOTECH DO BRASIL ANOTECH NIGERIA ALTEN CANADA SESAME GROUP BEIJING SESAME GROUP LIMITED (*) FC: Full consolidation

FC FC FC FC FC FC FC FC FC FC FC FC FC FC FC FC

100.00 100.00 65.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

Germany Poland Poland Romania Romania Sweden United-States Norway India India United-States Brazil Nigeria Canada China Hong Kong

Company name

ALTEN SA (1) ALTEN SIR ALTEN TRAINING CENTER ALTEN SUD-OUEST MI-GSO ALTEN CASH MANAGEMENT ALTEN EUROPE ELITYS CONSULTING PEGASE SI ATEXIS FRANCE ALTEN AEROSPACE AVENIR CONSEIL FORMATION ANOTECH ENERGY France HPTI ALTEN SIR GTS ID.APPS APTECH SAS (*) FC: Full consolidation (1) Consolidating entity

Siret no.

34860741700055 40035788500021 35390354500062 40419144700048 38054561600050 48011617700019 48016830100012 48420799800010 48484024400012 43904555000019 48761023100019 40246017400038 49304667600018 49967035400012 52190314600012 52910153700015 53296422800011

Abroad Company name

ALTEN GROUP

Consolidated financial statements at 30 June 2013

3. DETAIL OF THE CONSOLIDATED FINANCIAL STATEMENTS

ALTEN GROUP

Consolidated financial statements at 30 June 2013

3.1 GOODWILL

Goodwill allocated by country breaks down as follows: In thousands of Euros GreatFrance

GROSS VALUE 2011-12-31 Earn-out adjustments

105,410

Britain 5,087

The Netherlands

Belgium 3,104

Spain

12,824

27,514

Germany

Poland

Italy

18,127

7,783

Romania 1,389

Sweden

United-States

16,582

China

Total

6,347

204,166

(33)

Acquisitions (1)

2,230

10,693

3,282

16,205

3,282

220,339

Reclassifications 2012-12-31 Earn-out adjustments (3)

105,377

5,087

3,104

12,824

27,514

20,357

(2,115)

Acquisitions (2)

7,783

1,389

27,275

6,347

971

(1,144)

209

234

20,567

996

Reclassifications 2013-06-30

103,262

5,087

3,104

GreatFrance

IMPAIRMENTS

Britain

12,824

27,514

7,783

1,389

27,275

6,347

3,282

219,428

The Netherlands

Belgium

Spain

Germany

Poland

Italy

Romania

Sweden

United-States

China

Total

2011-12-31

10,468

3,852

2,573

1,929

600

344

19,766

2012-12-31

10,468

3,852

2,573

1,929

600

344

19,766

2013-06-30

10,468

3,852

2,573

1,929

600

344

Impairments

Impairments 0

GreatFrance

NET VALUES

Britain

19,766

The Belgium

Netherlands

Spain

Germany

Poland

Italy

Romania

Sweden

United-States

China

Total

2011-12-31

94,942

1,235

3,104

12,824

24,941

16,198

7,183

1,044

16,582

6,347

2012-12-31

94,909

1,235

3,104

12,824

24,941

18,428

7,183

1,044

27,275

6,347

3,282

200,572

2013-06-30

92,794

1,235

3,104

12,824

24,941

18,638

7,183

1,044

27,275

6,347

3,282

199,662

996

184,400

(1) In 2012: a. Acquisition of three companies in Sweden (X DIN Oresund, X DIN Services Stockholm and X DIN Services Linkoping). The acquisition was completed for approximately â&#x201A;Ź15 M without earn-out. b. Acquisition of engineering operations in Germany and of two companies in China. (2) In 2013: Acquisition in December 2012 of 65% of the equity of the Polish company Itekna, which has been consolidated effective 1 January 2013. (3) Price reduction in the implementation of a liability guarantee (IFRS 3).

ALTEN GROUP

Consolidated financial statements at 30 June 2013

The group conducts value tests annually or when value loss indicators emerge. Tests conducted at 30 June 2013 for UGTs with value loss indicators indicated that the redeemable value of assets exceeded the net book value. Consequently, no value loss was booked at 30 June 2013. The weighted actual cost of capital for the country and perpetual growth rate used at 30 June 2013 were the same as those at 31 December 2012.

In light of the contraction in activity in Spain (-14.9% of revenue compared to 30 June 2012), Spain is the most sensitive UGT to variations in assumptions. The results of sensitivity tests are summarised below:

Country

Spain

Goodwill

(****) Test

(*) WACC

margin

+ 1 point

24,941

3,001

-1,820

(*) At constant growth rate (2 %) (**) At constant discount rate (10,16 %) (***) At constant growth rate and discount rate (****) Test margin : v alue in use - goodwill v alue

(**) 1 % growth rate

(***)Normative profit on activity - 1 point

-148

-1,172

ALTEN GROUP

Consolidated financial statements at 30 June 2013

3.2 NON-CURRENT ASSETS AND AMORTISATION

In thousands of Euros PROPERTY, PLANT AND

2011-12-31 Change in scope

TOTAL

EQUIPMENT

INTANGIBLE ASSETS

GROSS VALUE

27,632

37,845

(2,486)

1,018

65,477 (1,468)

Exchange rate v ariations

(10)

Acquisitions and transfers

4,834

7,405

12,238

(275)

(4,359)

(4,634)

29,694

41,950

71,644 0 (153)

Div estments and disposals (1) 2012-12-31 Change in scope Exchange rate v ariations

(23)

(130)

Acquisitions and transfers

1,115

5,417

6,532

(75)

(1,475)

(1,550)

30,711

45,762

76,473

Div estments and disposals (1) 2013-06-30

PROPERTY, PLANT AND DEPRECIATION AND AMORTISATION

EQUIPMENT

INTANGIBLE ASSETS

2011-12-31

17,774

25,236

43,011

(159)

655

497

(3)

2,303

6,053

8,355

Change in scope Exchange rate v ariations Prov isions and transfers (2)

(275)

(4,111)

(4,386)

19,641

27,889

47,530

(18)

(73)

(91)

Decreases 2012-12-31

TOTAL

Change in scope Exchange rate v ariations Prov isions and transfers Decreases 2013-06-30

1,697

3,555

5,253

(75) 21,245

(1,441) 29,930

(1,516) 51,175

PROPERTY, PLANT AND NET VALUES (3)

INTANGIBLE ASSETS

EQUIPMENT

TOTAL

2011-12-31

9,857

12,609

22,466

2012-12-31

10,053

14,061

24,114

2013-06-30

9,466

15,832

25,298

(1) Concerns mainly the scrapping of fittings as a result of a business transfer. (2) The increase in depreciation charges was mainly due to the purchase of fixtures and fittings with a shorter useful life than in previous years. PROPERTY, PLANT AND (3) Including financial leases:

INTANGIBLE ASSETS

EQUIPMENT

TOTAL

At 2011-12-31

1,426

606

2,032

At 2012-12-31

1,223

796

2,018

At 2013-06-30

1,121

779

1,899

ALTEN GROUP

Consolidated financial statements at 30 June 2013

3.3 EQUITIY-ACCOUNTED STAKES (In thousands of Euros)

Amount

At 31 December 2011

3,027

Profit for the year

1,689

At 31 December 2012

4,717

Profit for the year

1,044

Change of method (IAS-19 rev ised standard)

At 30 June 2013

5,773

3.4 FINANCIAL ASSETS

(In thousands of euros)

Note

Financial assets Financial assets Loans and at fair value at fair value receivables at through income through equity amortised cost statement

Total financial assets at 2011-12-31

18,681

Financial assets available for sale

20,239

398,251

59,614

Other long-term assets Total non-current financial assets

20,239

476,545 20,239

4,105

Deposits and guarantees

Total

4,105

2,483

6,588

26,827

Trade receivables

3.5

402,753

Other current assets (*)

3.5

5,398

Cash and cash equivalents

3.6

Total current financial assets Total financial assets at 2012-12-31

20,239

Financial assets available for sale

20,660

66,523

408,151

66,523

474,674

414,739

66,523

501,501 20,660

Deposits and guarantees

5,039

Other long-term assets

2,285

7,324

27,984

418,949

Total non-current financial assets

20,660

Trade receivables

3.5

418,949

Other current assets (*)

3.5

3,418

3,418 78,067

78,067

Total current financial assets

422,366

78,067

500,433

20,660 Total financial assets at 2013-06-30 * (Excluding tax and social security receivab les and prepaid expenses).

429,690

78,067

528,417

Cash and cash equivalents

3.6

ALTEN GROUP

Consolidated financial statements at 30 June 2013

Stocks available for trading included the following equity investments: Company

Fair value at opening

Acquisition (disposal)

AUSY

9.42%

7,656

X-ANGE

5.96%

3,365

SMART TRADE

4.19%

634

Change in fair value

Impairment

(206)

Fair value at closing

1,227

8,883

(604)

2,555

Revenue 163,910

634

n.a

Shareholders Net 'equity earnings

Comments

87,134

2,979

2013-06-30

28,540

(4,936)

2012-12-31

14,701

711

2013-03-31 In the process of

PHOEBE INGENICA

19.00%

PHINERGY LTD

16.52%

8,391

MISCELLANEOUS Total

193

20,239

-202

liquidation 1,747

(3,615)

2012-12-31

198 0

622

20,660

One investor acquired a stake in the equity of Phinergy in April 2013. After the operation the stake held by Alten Europe was diluted from 19.49% to 16.52%. Stock value was not impacted given the parities kept for the capital increase reserved for the investor. Valuation levels for financial assets remained unchanged compared to 2012.

3.5 CURRENT ASSETS (In thousands of euros)

2013-06-30

2012-12-31

TRADE RECEIVABLES Gross v alue

425,085

Impairments

(6,137)

(6,643)

418,949

402,753

Total

409,396

OTHER CURRENT ASSETS Inv entory Social security receiv ables Tax receiv ables

143

1,443

1,845

29,934

27,254

Other receiv ables

4,130

11,693

Impairments of other receiv ables

(855)

(6,373)

Prepaid expenses Total

9,094

6,167

43,888

40,664

The following table presents the breakdown of the portfolio of trade receivables by age of the account:

(In thousands of â&#x201A;Ź)

2013-06-30 Unmatured

Less than 6 months

2012-12-31

6 months to More than 1 1 year

year

Balance

Unmatured

Less than 6 months

6 months to More than 1 1 year

year

Balance

TRADE RECEIVABLES Gross v alue

366,177

Prov isions NET VALUES

366,177

51,185

2,656

5,067

425,085

(141)

(952)

(5,044)

(6,137)

51,044

1,704

418,948

343,934

56,135

4,358

4,969

409,396

(617)

(1,115)

(4,911)

(6,643)

55,518

3,243

402,753

ALTEN GROUP

Consolidated financial statements at 30 June 2013

Based on its experience and given its trade debt collection policies, the Group estimates that the level of impairment for the financial year is adequate for the risks incurred.

3.6 CASH AND CASH EQUIVALENTS (In thousands of euros)

2013-06-30

2012-12-31

Marketable securities Cash and equivalents

20,678 57,389

13,034 53,489

Total

78,067

66,523

Marketable securities are valued at fair value. They comprise treasury investment funds and term accounts with maturity of under three months. Income from investment funds was not significant.

3.7 NON-CURRENT FINANCIAL LIABILITIES

(In thousands of euros) Other loans and related debs

2013-06-30 2012-12-31 440 450

Deposits and guarantees receiv ed Total

1,066

530

1,517

3.8 OTHER NON-CURRENT LIABILITIES (In thousands of euros)

2013-06-30

Earn-outs

2012-12-31 421

Social security debt

4,317

Deferred tax liabilities Total

4,153

574

914

4,891

5,487

3.9 CURRENT FINANCIAL LIABILITIES (In thousands of euros) Bank loans (1) Other loans and related debts Ov erdrafts Employee profit-sharig Total

2013-06-30

2012-12-31

20,000 492

621

6,496

7,086

231

229

27,218

7,936

(1) The â&#x201A;Ź20 M increase was the draw-down of the club deal credit line.

ALTEN GROUP

3.10

Consolidated financial statements at 30 June 2013

OTHER CURRENT LIABILITIES

(In thousands of euros) Social security debt Tax liabilities

76,139

Earn-outs Other liabilities Deferred income Total

3.11

2013-06-30 2012-12-31 139,098 130,920 87,867

336

676

34,165

22,694

12,723

14,139

262,462

256,296

PROVISIONS

(In thousands of euros)

Corporate

Commercial Miscellaneous

Retirement

disputes (2)

disputes

risks

benefits

3,644

1,444

5,083

6,604

1,980

At 2011-12-31 (updated) Change in scope

TOTAL 16,776

Exchange rate v ariations Prov isions for the financial year (1)

4,125

353

1,932

(1,149)

(919)

(141)

Rev ersals (surplus prov isions)

(533)

(822)

(2,478)

At 2012-12-31 (updated) Change in scope

6,088

4,397

1,358

308

176

(2,684)

(16)

(907)

Rev ersals (prov isions used)

Exchange rate v ariations Rev ersals (prov isions used) Rev ersals (surplus prov isions)

(622)

(9)

(50)

At 2013-06-30

4,139

339

3,616

2013-06-30 1,492

2012-12-31 1,260

NON-CURRENT PROVISIONS (In thousands of euros)

Commercial disputes Miscellaneous risks Retirement benefits

2,443

2,774

9,536

8,583

13,487

12,629

2013-06-30 2,647

2012-12-31 4,829

323

Miscellaneous risks

1,173

1,622

Total

4,143

6,496

2013-06-30 13,487

2012-12-31 12,629

Total

CURRENT PROVISIONS (In thousands of euros) Corporate disputes Commercial disputes

(In thousands of euros) Total non-current prov isions

(3,832) 8,583

19,125

Prov isions for the financial year

(In thousands of euros) Corporate disputes

8,390 (2,209)

Total current prov isions Total liabilities and expenses provisions

4,143

6,496

17,630

19,125

952

2,793 (3,608) (681)

9,535

17,630

ALTEN GROUP

Consolidated financial statements at 30 June 2013

(1) In 2012 the increase in miscellaneous risks resulted primarily in a provision for restoration of premises subject to a lease terminated at the end of the year and a provision for restructuring (see note 3.14) (2) Labour disputes concerned individually insignificant amounts.

3.12

PAYROLL EXPENSES

At 30 June 2013 personnel charges including the CICE can be broken down as follows: (In thousands of euros) Salaries and benefits

2013-06-30 2012-06-30 (439,264) (418,547)

Corporate disputes

2,296

Retirement benefits Taxes lev ied on wages Employee profit sharing Total

3.13

399

(758)

(1,000)

(5,166)

(4,889)

(1,042)

(3,953)

(443,935)

(427,991)

OTHER OPERATING INCOME AND EXPENSES

(In thousands of euros)

2013-06-30

2012-06-30

Expenses Prov isions for impairments Losses on unrecov able receiv ables Prov isions for long-term contingencies Book v alue of fixed assets sold Other expenses Total expenses

(669)

(1,323)

(1,246)

(1,531)

(483)

(519)

(33)

(58)

(23)

(197)

(2,454)

(3,628)

Income Rev ersal of prov isions for receiv ables

2,208

2,756

Rev ersal s of prov isions for long-term contingencies

1,012

1,632

Proceeds from sale of fixed assets Other income

Total income

3.14

3,243

4,411

OTHER NON-CURRENT OPERATING INCOME AND EXPENSES

(In thousands of euros

2013-06-30

2012-06-30

Expenses Restructuring costs (1) Costs linked to the acquisition of new companies

(1,402)

(615)

(19)

(525)

Tax (URSSAF) adjustment

(343)

Disputes and litigation costs

(183)

Total expenses

(1,604)

(1,483)

Income Repayment of social and taxes claims

810

Settlement agreement on prev ious acquisition

973

Total income

1,783

ALTEN GROUP

Consolidated financial statements at 30 June 2013

(1) Costs generated by limited adaptation measures related to the decline in the economic environment (short time work, workforce reduction, site consolidation, etc.). This item concerned primarily the costs incurred and provisioned in Spain, Belgium and the Netherlands.

3.15

NET FINANCIAL INCOME

(In thousands of euros)

2013-06-30

Bank interest charges

(473)

Interest on lease-financing agreements

2012-06-30 (397)

(9)

(12)

Cost of gross financial indebtedness

(482)

(409)

Income from loans and receiv ables

224

150

Proceeds from the disposal of marketable securities

(258)

Foreign exchange losses

(1,668)

(1,491)

Other financial expenses

(449)

(207)

Cost of net financial indebtedness Abandonment of financial receiv ables

(30)

Financial update expenses

(194)

(5)

(2,311)

(1,734)

1,636

1,801

Other financial income

187

117

Other financial income

1,823

1,918

Financial prov isions Other financial expenses Foreign exchange gains

Other net financial income and expenses

(488)

184

NET FINANCIAL INCOME

(747)

(74)

ALTEN GROUP

3.16

Consolidated financial statements at 30 June 2013

BREAKDOWN OF INCOME TAX EXPENSES

(In thousands of euros)

2013-06-30

2012-06-30

Net Earnings : Group and minority interests Earnings of equity-accounted companies Impairment of goodwill Stock-options Income tax expense Pre-tax earnings

36,338 (1,044) 0 (24) 17,947 53,217

38,807 (819) 0 193 19,264 57,447

Tax rate of the consolidating company Theoritical income tax charge Specific tax 3% on paid dividends Additional contribution 5% Difference in tax rate versus foreign companies Tax credits (apprenticeships, family, grants, etc.) Research tax credits (CIR and CICE) * Unactivated deferred tax assets CVAE (value added tax) reclass. Other permanent differences

34.43% 18,324 968 145 (1,444) (279) (2,911) 639 3,327 (822)

34.43% 19,781 0 309 (1,568) (392) (2,246) 68 3,232 81

Tax expense recognised

17,947

19,264

Effective income tax rate

33.72%

33.53%

1,850 16,097 17,947

514 18,751 19,264

Income tax distribution Deferred taxes Income tax payable Total

(*) Non-taxable income The amount of recognised deferred taxes related to tax losses carried forward equalled €€1.5 (€5.5 M in base) at 30/06/2013.

ALTEN GROUP

3.17

Consolidated financial statements at 30 June 2013

OPERATING SEGMENTS

In accordance with IFRS 8 â&#x20AC;&#x201C; Operating segments, the financial information disclosed herein after equates to the information used by the principal operating decision-maker (the chairman) internally to assess the performance of segments. (In thousands of euros)

2013-06-30

France Revenue Inter-segment and intra-group neutralisation Net revenue Operating profit on activity Rate of Operating profit on activity/ revenue for the segment Profit from ordinary activities Operating profit Earnings of Consolidated Entities

PROFIT

Abroad

2012-06-30

TOTAL

France

Goodwill

Workforce at Year End Cash at end of period (2) Financial liabilities (3) Net investments for the period

France

Abroad

TOTAL

400,497

261,771

662,268

418,718

223,266

641,984

833,055

457,159

1,290,214

(29,568)

(48,473)

(35,841)

(7,489)

(43,330)

(75,374)

(16,831)

(92,205)

381,592 28,953

232,203 24,831

613,795 53,784

382,877 32,081

215,777 26,922

598,654 59,003

757,681 67,129

440,327 53,457

1,198,009 120,586

7.6%

10.7%

8.8%

8.4%

12.5%

9.9%

8.8%

12.1%

10.1%

28,977 29,326 17,160 18,204

24,831 24,661 18,135 18,135

53,808 53,986 35,294 36,338

31,888 32,012 19,978 20,797

26,922 25,315 18,011 18,011

58,810 57,328 37,989 38,807

66,850 68,427 43,244 44,933

53,457 47,953 33,469 33,469

120,307 116,380 76,713 78,402

France 93,073

Abroad 106,589

2012-06-30

TOTAL

France

199,662

Impairment over the financial year Equity-accounted stakes (1)

TOTAL

(18,905)

2013-06-30

(In thousands of euros)

Abroad

2012-12-31

94,892

Abroad 100,151

2012-12-31

TOTAL

France

195,043

Abroad

TOTAL

94,909

105,663

200,572

5,773 9,115 48,555 26,382

6,675 29,512 1,367

5,773 15,790 78,067 27,748

3,846 9,160 35,241 49,758

6,340 31,735 1,090

3,846 15,500 66,976 50,847

4,717 9,300 38,332 8,402

6,650 28,191 1,051

4,717 15,950 66,523 9,453

2,872

4,166

7,039

5,959

17,236

23,194

9,008

24,958

33,966

(1) see note 3.3 (2) see note 3.6 (3) see notes 3.7 and 3.9

Given the Groupâ&#x20AC;&#x2122;s diverse customer portfolio, no customer represents more than 10% of consolidated sales as of 30 June 2013.

ALTEN GROUP

3.18

Consolidated financial statements at 30 June 2013

EARNING PER SHARE

(In euros)

2013-06-30

Earnings Weighted average number of shares Earnings per share (In euros) Earnings

2012-06-30

36,194,503

38,732,323

32,203,964

31,814,569

1.12

1.22

2013-06-30

2012-06-30

36,194,503

Dilutive effect of stock warrants

38,732,323 (50,964)

Diluted earnings

36,194,503

38,681,359

Weighted average number of shares

32,203,964

31,814,569

393,054

245,999

32,597,018

32,060,568

Effect of dilutions Weighted average number of shares after potential dilution Diluted earnings per share

1.11

There are no non-dilutive instruments.

1.21

ALTEN GROUP

3.19

Consolidated financial statements at 30 June 2013

CASH FLOW STATEMENT

Changes in depreciation, amortisation and provisions net of reversals

2013-06-30

2012-06-30

Amortisation of intangible assets

1,595

862

Depreciation of property, plant and equipment

3,288

2,538

(1,496)

(512)

3,386

2,888

Impairment of goodwill Provisions for risks and expenses Total

Breakdown of taxes paid

2013-06-30

2012-06-30

1,968

8,088

Payments made

(24,974)

(22,672)

Total

(23,007)

(14,584)

Repayments received

Breakdown of cash flows on working capital requirement

2013-06-30

2012-06-30

Changes in net WCR - customers

(7,199)

(14,401)

Changes in net WCR - suppliers

(1,980)

219

1,863

(2,200)

(7,315)

(16,382)

Changes in net WCR - other receivables and operating payables Total Impact of changes in scope and earn-outs

2013-06-30

2012-06-30

Acquisitions of consolidated subsidiaries

(17,673)

Cash from new consolidated subsidiaries

1,830 (253)

Cash from deconsolidated subsidiaries Total

Capital increase

2013-06-30

2012-06-30

6,692

Share options exercised

(16,096)

705

Cancellation of treasury shares Issue of stock warrants 77

Subscription to the capital of new companies Total

6,770

705

ALTEN GROUP

3.20

Consolidated financial statements at 30 June 2013

CONTINGENT ASSETS AND LIABILITIES

Contingent assets A group company has disputed the adjustment implemented by URSSAF (concerning â&#x201A;Ź7 M). No contingent asset has been booked accordingly pending the court's ruling. Contingent liabilities The group has a dispute with a minority partner in a subsidiary. The overall claim by the plaintiff, which is disputed by ALTEN, amounts to approximately â&#x201A;Ź2 million. The resolution date has not been specified. The amounts which the group considers payable are booked in the consolidated accounts as goodwill under assets and as debts under liabilities in accordance with IFRS.

3.21

RELATED PARTY TRANSACTIONS

Compensation allocated to company officers No significant variation occurred in the first half of 2013 with regard to compensation disclosed at 31 December 2012.

3.22

FINANCIAL COMMITMENTS

No significant variation occurred in the first half of 2013 with regard to compensation disclosed at 31 December 2012.

Statutory Auditors' report on half-year financial statements ALTEN - 1 January 2013 to 30 June 2013 Dear Shareholders, In order to carry out the assignment entrusted to us by your General Shareholder Meeting and pursuant to article L. 451-1-2 III of the French Monetary and Financial Code, we have undertaken the following: â&#x20AC;˘

A limited examination of the consolidated and condensed half-year financial statements of the ALTEN company for the period from 1 January 2013 to 30 June 2013 which are attached to this report

â&#x20AC;˘

A verification of the information provided in the half-year activity report.

The consolidated, condensed half-year statements were drawn up under the responsibility of the board of directors. Our role is to express an opinion on these financial statements based on our limited examination. 1

Findings concerning financial statements

We have carried out our limited review in accordance with professional standards applicable in France. A limited examination or review entails primarily discussions with executives tasked with the accounting and financial aspects and implementing analytical procedures. These tasks are less extensive than those required for an audit carried out in accordance with professional standards applicable in France. Consequently, assurance that financial statements taken as a whole does not contain any significant anomalies resulting from a limited examination must remain moderate and less broad than what would result from an audit. Based on our limited examination, we have not identified any significant anomalies which may bring into question the compliance of the condensed half-year consolidated financial statements with IAS 34, the standard in IFRS adopted in the European Union concerning interim financial disclosures. Without questioning the finding stated above, we would like to draw your attention to note 2.4 "Change in method" for the notes to the condensed consolidated half-year financial statements that outlines the effects of applying IAS 19 "Employee Benefits" amendments as of 1 January 2013. 2

Specific verification

We also verified the information stated in the half-year activity report with comments on the condensed consolidated half-year financial statements covered by our limited examination. We have no matters to report with regard to the fairness and consistency of this information against the consolidated financial statements. Paris, 08 October 2013 The Statutory Auditors Grant Thornton

Cabinet Dauge & AssociĂŠs

French member of Grant Thornton International Laurent Bouby

Christian Laplane

Partner

Partner - 38 -

Declaration by the person responsible for the halfyear financial report

"I hereby certify that to the best of my knowledge the condensed financial statements for the past half year have been drawn up in accordance with applicable accounting standards and provide a fair reflection of the assets, financial situation and results of the company and of all the companies included in the consolidation process and that the half-year activity report provides a reliable overview of the major events occurring in the first six months of the financial year, their effect on accounts and of the main uncertainties for the remaining six months of the financial year. " Paris, 08 October 2013

Simon AZOULAY Chairman and Managing Director

- 39 -