2019 H1 Results with Paul Hermelin

Quite a satisfactory feeling about this first half. First, we started the year on a good growth rate, steady growth. The year is progressing well on the margin. We delivered 17 consecutive semesters of margin improvement, which I think is rather spectacular. So overall, certainly good.

So the first one, as I said, revenue grows 6.2% growth overall. Constant currency, some acquisitions. The organic growth is slightly below 5%, but that's still a good growth. I was pointing at the margin improvement. Margin improved by 50 basis points. This is better than the last two previous, so it's a strong progression. It's based on the gross margin, and the gross margin reflects the improvement of all portfolio. When we deliver advanced projects, what we call digital and cloud, we sell them with better pricing conditions, and that helped us grow the margin. The net results improved by 23%, which is good, overall to 380 million. And the net cash is again positive in the first half, which is 90 million, which beats the consensus. So a good performance overall.

The good thing is we deliver while continuing investing. We invest in the portfolio with our seven strategic offers, and I'd like to point out some stellar progression: AI we grew by 70%, the cloud we grew on every front. We have been awarded really good performance with Amazon Web Services. As you know, we definitely are a pioneer in cloud integration services. And then we invest in the delivery, we invest in technology, we invest in agile work, we invest in DevOps development. So I'm quite happy that we progress on both fronts: what we sell and how we deliver.

I would like to point at a small company, US-based, but is quite representative of what we want to do. EagleView is a company that was built on space imagery and they work on global information systems and analytics. We have been delivering there a very interesting contract that combines all our skills for better operations. That's an advanced company, so I think it is at the forefront of what we want to do. I also refer to what I observed when attending the Paris Air Show at Le Bourget and Crafton? We have been awarded a real platinum partnership with Airbus, delivering service on SkyWatch, they have a data platform, and I think that's advanced in terms of data architecture and data advanced services.

After an incredible stellar performer last year, we managed to still grow a little bit with further investment and expect the second half to show real better growth, notably in some patchy sectors like banking. The rest of Europe is developing well; we had fears about automotive, but Germany starts to grow again. France and UK have been very good indeed, and in spite of Brexit, we recorded incredible growth in the United Kingdom. The rest of the group is doing fine; Latin America is doing better, and Asia Pacific excellence. Overall, a good year, the demand is there, and I'm particularly happy to see that the new cloud and digital now represent 60% of the revenue, which is certainly promising for the future.

As you remember, on June 24 we announced the joint decision from the Altran and Capgemini Board to favor the joining of the two companies. I think that is a very, very exciting development for the group. We want to be a pioneer, first mover in what we call intelligent industry. It is the combination of information technology and operation technology. Altran is the global leader of engineering and R&D services. We are an innovator in manufacturing and technology, and the combination of the two is designed to build a global leader. Very excited with that. We have offered €14 per share. The board of Altran supports the operation, the board of Capgemini supports it, of course. The International Workers Council of Capgemini has already supported it. We expect the Altran works council support too, that's imminent, and we will move forward.

Year 2019. Based on that solid first half, we will just confirm what we said in February. For the full year: first, growth between 5.5% and 8% at constant currency; second, an additional progression on the operating margin within the range between 12.3% and 12.6%; and third, organic free cash flow above €1.1 billion. Based on that solid first half, I think we will deliver that. But I want to thank you very much. Thank you.