Econocom sees fruits of ECS merger

French Econocom, working in infrastructure and with telcos has just reported its annual sales in 2011 of €1.580bn (€1.021bn in 2010), significantly exceeding its target (€1.4 billion). The good sales momentum observed in 2011 helped offset the withdrawal of non-core business activities.

This performance is due to the commercial synergies arising from the integration of ECS acquired in October 2010 and the continued development of new offerings to meet and anticipate the needs of business, it says.

Leasing activity, supported by the addition of ECS and the success of enterprise solutions (Desktop on demand by Econocom, Mobileasy by Econocom, etc.), supported the performance. Managed Services are up slightly, enjoying a momentum in telecom services. Finally, distribution of both products & solutions had "a very good year" thanks to the multi-year contract with the European institutions, the rise of activity dedicated in the medical sector and the deployment of tablets.

France, which accounts for nearly 50% of consolidated turnover of the Group performed well despite the challenges of integration in that territory. Benelux (24% of consolidated sales) and the United Kingdom (4.5% of consolidated sales) reaching double-digit growth. The countries of Southern Europe and East, meanwhile, stood up well in a difficult economic environment, it says.

The sustained level of activity makes Econocom confident in its ability to exceed its target for current operating income of €56m in 2011. In the first year of integration of ECS, Econocom began to reap the fruits of its merger in terms of synergies, while strengthening its financial structure, including the repayment of bank debt acquisition. The cost of implementing these actions (operational and financial), recorded in non-recurring expenses, is in line with expectations and in line with the first half, it says.

2011 annual results will be published on March 7, 2012, after market close.