Karthik Natarajan, the former head of Tech Mahindra’s Integrated Engineering Services (IES), has joined Cyient as COO. We think, the appointment of Mr. Natarajan is a welcome move for Cyient, which has faced growth challenges in the past quarters, resulting from its client concentration and its exposure to Boeing and Pratt & Whitney.
Currently, Covid-19 has only affected China significantly, although having spread in South Korea, Japan, and Northern Italy.
Several ER&D vendors have been impacted so far: Ricardo has warned that the situation in the Chinese automotive market would have a “material” effect on its profit.
Bertrandt had a soft quarter in Q1 FY20 (corresponding to calendar Q4 2019): revenues were flat (+0.4%) to EUR 263m, impacted by project delays, and reduced utilization rates in its Digital Engineering (DE) unit (-3.0%). DE, Bertrandt’s largest unit (55% of revenues), suffered from Germany OEMs shifting their R&D spending to digital.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Altran’s organic growth slowed down to +3.3% yoy in Q4. The company suffered from two main effects: Brexit delaying decision-making in the UK and deteriorating market conditions in the German automotive market. As a result, Altran’s North Europe and Central Europe business units were down by respectively 9.6% and 8.4% yoy in Q4.
After its unexpected revenue growth slowdown in Q4, Akka suffered from a disappointing result: it secured only 64% of the shares of Data Repons. Akka has received regulatory clearance from the German cartel office authority, so now has control over Data Response.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Alten’s revenues in Q4 slowed down to a growth of +7.3% yoy (at CC/CS ), following double-digit CC/CS growth during Q1-Q3 2019. The company suffered from a demanding comparison basis (+13.7% in Q4 2018), and one lesser working day in several countries (a 0.15% impact on the group’s revenues).
Tech Mahindra made a surprise move in semiconductor engineering services. The company is to acquire Cerium
Capgemini has succeeded with its offer to purchase Altran. The company has secured 53.4% of Altran’s capital. According to France’s financial market’s authority, Capgemini will reopen the tend offer from January 28 to February 10.
LLTS’ revenue growth in Q3 FY20 decelerated from 11.9% at CC in Q2 to +7.5% in Q3. The company was hit by a deteriorating situation in its Telecom & High-Tech (-26%), which was impacted by the ramp-down of two clients in its Semiconductor sub-vertical that represents (we estimate) 40% of its Telecom & High-Tech sector. LTTS, also, had flat growth (+2%) in its Industrial Products, with large accounts reducing their spend.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Wipro announced a mild growth in the revenues of its Industrial and Engineering (I&E) business unit in Q3 FY20: I&E revenues were up by 3.1% only (to USD 151m). Revenues included a small contribution from the recent ITI acquisition and were impacted by the market conditions in the semiconductor industry and softness in 5G adoption.
Capgemini modestly increased its tender offer for Altran by 3.6%, from €14.0 to €14.5 per share.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
Become a ERD Services premium reader to access all of your content, by contacting us at dominique@ERDservices.org.
In a November blog, we had mentioned that Akka had issued €175m in convertible bonds. Akka
The Paris Court of Appeals rejected this morning ADAM’s request for suspension of the Capgemini tender offer for Altran’s shares.
Belcan strengthened its software engineering capabilities with the acquisition of Base2 Solutions, a firm headquartered in Bellevue, WA and with an office in California. Base2 has a similar client base to Belcan, with major clients including Boeing, Thales, and L3Harris in aerospace and defense.
Bertrandt had a mixed Q4 FY19 performance with revenues up 2.6% and an EBIT margin of 5.2% (down 330 bps). For the full year, revenues reached EUR 1,060m, up 3,8%, within the guidance range the company had provided (EUR 1,041-1,071m).
SII improved its profitability in H1 FY20 despite its reorganization
investments. Its adjusted operating margin was up by 30 bps to 7.2%. France’s margin remained low to 5.6%, improving slightly by 20 bps.
Automotive engineering pure-play KPIT continued on its growth momentum in Q2 FY20 (+15.2% yoy), enjoying a satisfactory EBITDA margin of 13.4%. KPIT’s financial performance was, however, a notch below that of Q1 both in terms of revenue growth (Q1: +19.3%) and margin (14.6%).
We don’t usually comment on the financial performance of ER&D service vendors beyond their financials. But this time, this is a little bit different: Akka Technologies raised yesterday EUR 175m in convertible bonds, a significant amount for Akka, which has a market cap of EUR ~EUR 1.2bn.