Business affected by exceptional events
In the first quarter of 2020 Econocom Group posted revenue from continuing operations of €596 million, an 11.5% drop on a like-for-like basis, 11.1% of which organically, compared with Q1 2019.
This decrease is largely due to the impact of the Covid-19 crisis and the confinement of employees in its main geographical areas (in particular in France, Spain and Italy).
The breakdown of revenue by business line is as follows:
• Revenue for Technology Management & Financing (TMF) fell 16.1% to €181 million, partly as a result of delays in signing contracts for deals and deliveries (due to clients’ reception facilities being closed) reported in March 2020.
• Digital Services and Solutions (DSS, which includes Products & Solutions and Services) stands at €415 million, down 9.3%. The two business lines sustained almost identical downward trends, with Products & Solutions standing at €260 million (-9.5%) and Services registering a 9% drop to stand at €155 million.
Outlook: H1 2020 under pressure but handled confidently and methodically
As in the first quarter, Q2 2020 revenue will also feel the effects on the global economy of the Covid-19 pandemic. The extent of the impact will depend on both the length of the confinement period of employees and the conditions in which Econocom’s client companies will resume normal business.
On 16th March 2020, Econocom set up two crisis management teams, one for France and one for the other countries it operates in, which meet regularly to keep up to date with the latest developments on the situation and decide rapidly how to respond. These crisis management teams are made up of members of the executive board and heads of the business lines and main support function departments. They coordinate the Business Continuity Plan, which has been adapted for each business line and about which staff are kept regularly updated.
The main points of the Business Continuity Plan are as follows:
• All employees who can do so work from home.
• Products & Solutions and TMF continue to serve their clients; staff’s efforts, facilitated by the implementation of electronic procedures and signatures, ensure smooth running of operations.
• Services also continue to provide services and adapt to each client’s situation.