EDITORIAL SETTING A NEW COURSE FOR NEOPOST

Transcription

1 LANDMARKS 2012

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3 2012 LANDMARKS EDITORIAL EDITORIAL SETTING A NEW COURSE FOR NEOPOST Roll-out of the new generations of mail management solutions, broadened parcel processing applications, stepping up of the development rate of non-mail related businesses and expansion of its service offering: Neopost s new strategy has already begun to pay off in Europe, North America and the Asia-Pacific region. The expansion of trade and the accelerating pace of technological change offer promising opportunities for Neopost. With the innovative solutions developed in-house, those devised by companies we have acquired or with whom we partner, we are continually doing more to help businesses and organisations to manage their communication flows effectively was a year of achievement in this regard. 1

4 C ONTENTS 2

5 2012 LANDMARKS CONTENTS INTRODUCING 4 Neopost MEETING 6 Denis Thiery, Chairman and Chief Executive Officer 10 Management team 12 Board of Directors BUILDING 16 With our clients 18 An enhanced international presence INNOVATING 22 Optimised mail management INTEGRATING 28 Effective management of customer communications 30 High quality data 32 Technologies for tracking parcels and goods GROWING 36 Responsibilities and commitments DELIVERING 42 Neopost on the stock market 44 Performance in Summarised financial statements 3

6 Neopost, a key player in mail and parcel management, is continuing to enhance its business activities. Its mailing and document management solutions now form part of a wider offering, from data quality management to management of customer communications tools, as well as parcel tracking solutions and logistics processes. Neopost also offers a vast range of services, including consultancy, maintenance, financing solutions and online services. Neopost s momentum is based on its ability to use innovation to make its clients more efficient and competitive. WE VALUE YOUR MAIL and more. 4

7 2012 LANDMARKS INTRODUCING No.1 in Europe 800,000 clients worldwide 1.07 billion in sales in ,900 employees No.2 worldwide over 90 countries in which Neopost solutions are sold 29 countries in which Neopost operates directly 5

8 Interview DENIS THIERY Chairman and Chief Executive Officer In 2012, you set out a new strategy for Neopost. Why? DENIS THIERY: Neopost is operating in a mature industry. If we want to continue to expand, we need to find new growth drivers. We already have around 800,000 clients equipped with our systems. We have an active relationship with all of these clients, most of whom are SMEs, associations and administrative organisations. These clients are now faced with the growing complexity of communications technologies and the need for physical mail flow to co-exist with electronic information and documents. We see this as an amazing opportunity, in the same way as the increase in parcel volumes creates new needs among our clients. What does the new strategy entail? D.T.: First of all, our strategy consists of continuing to develop our business in dedicated mail management solutions. To do this, we are relying on our ability to regularly renew our product ranges, as well as our ability to offer our clients new services with greater added value and continuing geographical expansion. The second pillar upon which our strategy is based is stepping up the development rate of complementary activities by making acquisitions where appropriate. By establishing a foothold in sectors such as logistics solutions, data quality and customer communications management, we are targeting niche markets presenting strong growth potential. Our criteria are clear: we want to be able to become a key player, develop commercial synergies and achieve a return on capital of at least 15%. Lastly, we want to adapt these solutions in order to make them accessible to our traditional clients and thereby extend our existing offering beyond mail. What ties can be made between this new strategy and Neopost s performance in 2012? D.T.: To step up development of non-mail related activities, we made two acquisitions in 2012: one in customer communications management, GMC Software Technology, and another in data quality, Human Inference. Our business therefore benefited from this enlarged scope, but that is not all. All of our so-called Communication & Shipping Solutions delivered strong organic growth. GMC Software Technology has stepped up its rate of growth since it was acquired by Neopost in July. In total, Communication & Shipping Solutions activities accounted for 13% of sales compared with 8% a year earlier, and this proportion will continue to rise. Although these activities have a favourable effect on sales and operating profit, for the time being they are less profitable than our traditional mail activities, which means that their strong growth has had a slightly dilutive impact on our margins. Can you tell us how 2012 went in your traditional activities? D.T.: 2012 was a year of contrasts. In North America, we knew that the number of expiring lease contracts for mailing systems would decrease in

9 2012 LANDMARKS MEETING Our clients are increasingly faced with the necessity and the complexity of making physical mail co-exist with electronic information and documents. We see this as an amazing opportunity for Neopost. 7

10 Interview These contracts last for five years. Following the peak generated by the decertification programme of 2006, we recorded a strong performance in Knowing this, we redeployed our sales teams towards cross-selling activities that took several months to pay off. In France, merging our two distribution subsidiaries disrupted our commercial productivity, resulting in a fall in equipment sales. The situation nevertheless improved over the course of the year. In the rest of Europe, we achieved some strong performances and saw very robust growth in the Asia-Pacific region. The takeover of our distributor GBC Fordigraph in 2011 proved to be extremely positive, allowing us to roll out our sales and marketing policy more effectively in Australia. We have also begun to benefit from setting up a regional office in Singapore. Our parcel logistics activities have also benefited considerably from our increased presence in the region, whether in tracking solutions made available to postal operators such as Singapore Post and Australia Post, or rolling out in Australia secure parcel lockers, which allow parcels to be collected at any time of day or night. You had to manage major debt repayments. How did this go? D.T.: We had more than 800 million credit lines to repay. In the space of a few months, we managed to raise 867 million and $270 million by means of various bank loans and private loans, which allowed us to diversify our sources of borrowing and call on European, American and Asian investors. In total, we have extended the average maturity of our loans from less than two years to more than four years. And Neopost s credit quality has been confirmed once again, in that after refinancing, the average cost of debt remains below 4%. Lastly, this refinancing campaign has enabled us to remain flexible, as more than 450 million of our revolving credit facility remains undrawn. Neopost is in a healthy financial position. Future leasing and rental revenues remain well above the level of net debt, which is therefore allocated entirely to financing equipment installed with our clients. How does 2013 look? D.T.: Despite continuing difficult economic conditions, the year is looking good. We expect to see total sales growth of more than 5% at constant exchange rates, with slight growth in mail-related activities. We will benefit from launching in North America the new generation of mailing systems, the IN range, which will coincide with the expiry of contracts for mailing systems installed in 2008 at the time of the last US decertification programme. In France, the commercial reorganisation of 2012 should start to bear fruit. We will continue to expand in the Asia-Pacific region. Meanwhile, our Communication & Shipping Solutions should achieve double-digit organic growth, in addition to the scope effect relating to consolidating over 12 months GMC Software Technology and Human Inference. Shipping activities in particular should benefit from the roll-out of secure parcel lockers in Australia. GMC Software Technology will continue 8

11 2012 LANDMARKS MEETING to implement its development strategy among key account customers in addition to its traditional client base of professional print service providers. We will focus on the strategic fit between the services offered by Satori Software and Human Inference and Cash flow generated by Neopost will enable us to continue to pay out high dividends while also financing the expansion of our activities and possible acquisitions. we will implement commercial synergies between all of the different units and the Neopost network. We also hope that the first pilot projects launched to begin the rolling out of the technologies developed by our dedicated units to our traditional clients will prove to be successful. In addition, we expect to maintain operating margin before acquisition-related expenses above 25% in all of the operations integrated under the Neopost brand and above 12% at our dedicated Communication & Shipping Solutions subsidiaries. Lastly, the high level and recurring nature of cash flow from operations will enable us to continue to pay out high dividends to our shareholders while also financing the expansion of our activities and allowing us to seize new acquisition opportunities. 9

12 Management team Denis THIERY Chairman and Chief Executive Officer Clem GARVEY Europe, Asia-Pacific and Exports Dennis LESTRANGE North America Jean-François LABADIE Finance Henri DURA Communication Management Enno EBELS Data Quality Alain FÉRARD Neopost ID 10

13 2012 LANDMARKS MEETING A UNIFIED TEAM TO STEER THE GROUP Neopost s management team develops and implements the strategic decisions of the Group. It is made up of 13 senior managers, all of whom have a truly international profile. With strong complementary skills, the management team embodies and gives life to the Neopost spirit of ambition and commitment. A DECENTRALISED STRUCTURE IN ORDER TO BE CLOSER TO OUR CLIENTS Neopost subsidiaries enjoy a high level of operational autonomy to allow them to be closer to clients and understand their concerns. The limited number of hierarchical levels helps with the circulation of information and ensures responsiveness and agility in decision-making. Neopost s decentralised organisational structure encourages entrepreneurial spirit and favours recognition. Nikolaus SCHOLZ Strategy & Marketing Philippe BOULANGER Research and Development Thierry LE JAOUDOUR Supply Chain Chris HOCKEY Human Resources Alain MIDOWSKI Legal Gavin MACRAE Partnerships 11

14 Board of Directors A LARGELY INDEPENDENT BOARD OF DIRECTORS Neopost is led by a Board of Directors consisting of 10 members. The directors have recognised expertise and come from diverse backgrounds. They have used their skills in areas that can provide added value for Neopost. In matters of corporate governance, Neopost refers to the Corporate Governance Code for listed companies published by Afep and Medef in December Seven directors are independent, as defined in the Afep-Medef code. MISSIONS OF THE BOARD The Board of Directors approves the strategic orientation and large projects of the Group, whether related to internal or external developments. The Board met eight times during the 2012 financial year and had an attendance rate of 86%. The Board of Directors is supported in its work by three dedicated committees. These committees each met three times and had an attendance rate of 100%. COMPENSATION COMMITTEE: Catherine Pourre* (Chairman), Vincent Mercier*, Agnès Touraine* and Jean-Paul Villot. AUDIT COMMITTEE: Éric Courteille* (Chairman), Henk Bodt, Jacques Clay* and Catherine Pourre*. APPOINTMENTS COMMITTEE: Agnès Touraine* (Chairman), Cornelius Geber*, Vincent Mercier* and Jean-Paul Villot. 12

15 2012 LANDMARKS MEETING COMPOSITION AS OF 31 JANUARY 2013 DENIS THIERY Chairman of the Board since January Chief Executive Officer of Neopost since June Denis Thiery joined the Group in 1998 as CFO after being CEO of Moorings and holding various positions with Wang France and PricewaterhouseCoopers. HENK BODT Board member since June Henk Bodt was previously Vice-Chairman of Philips and then Chairman of Océ. JACQUES CLAY* Board member of Neopost since January Jacques Clay spent the majority of his career with Hewlett-Packard, in Europe and the United States, in charge of the PC division. ÉRIC COURTEILLE* Board member since March Eric Courteille held a variety of positions in finance at Kering group (formerly PPR). He is currently Chief Financial Officer and General Secretary of Redcats (Kering group). CORNELIUS GEBER* Board member of Neopost since July Cornelius Geber acted as a consultant to senior management of the German Post Office and was Chairman of the Board of Kuehne + Nagel. VINCENT MERCIER* Board member since July Vincent Mercier is Vice-Chairman of the Supervisory Board of Roland Berger Strategy Consultants after having run the French and Chinese operations. CATHERINE POURRE* Board member since July Catherine Pourre is Executive Director - Central Functions and member of the Management Board of Unibail-Rodamco, having been a partner at PricewaterhouseCoopers for 10 years. ISABELLE SIMON* Board member since July Isabelle Simon worked at Cleary Gottlieb Steen & Hamilton, Goldman Sachs, Publicis and then Monte-Carlo SBM. AGNÈS TOURAINE* Board member since July Agnès Touraine manages Act III Consultants, a growth strategy consulting company. Most notably during her career, she has been in charge of Vivendi Universal Publishing. JEAN-PAUL VILLOT Chairman of the Board from 1996 to January Chairman and Chief Executive Officer of Neopost from 1996 to Jean-Paul Villot joined Neopost in September 1995 having held management positions at Bull, Schlumberger and Océ in France and abroad. * Independent director. 13

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17 FOCUSED ON OUR 800,000 CLIENTS 15

18 With our clients The best solution is one that is designed to meet the specific objectives and particular needs of the client. An acute sense of listening and analysing clients needs, solid experience in mail and parcel management, an advisory approach, a proven capacity for innovation, a range of services extended to data management and customer communication tools: all of these factors lead to the development of comprehensive and customised solutions and make Neopost a partner its clients can trust. Businesses and organisations are subject to a number of pressures including the integration of new technologies, developing digital communication tools, more intense competition, complex client expectations and the need for efficiency and profitability. In order to be able to focus on their businesses, become more efficient and optimise their costs, Neopost provides clients with innovative and customisable solutions with a high level of added value, helping them to automate processes in a way which is appropriate to their business needs today and adaptable for the evolution of these needs tomorrow. SUPPORTING THE CHANGING NEEDS OF OUR CLIENTS The Neopost spirit is to persevere until the objective has been achieved. Rolling out a new solution inevitably means coming up against a few difficulties. The most important thing is to be with the client in order to help ensure that the migration phase succeeds as well as possible. It is only when everything is in place to allow the client s productivity to be improved that Neopost s job is done. In order to develop, all businesses review their methods, integrating technical innovations into their processes and systems. This applies equally to large companies and SMEs, manufacturers and service companies, postal operators and logistics companies. Businesses interact increasingly frequently with their clients - whether transactional or promotional - and this is done via a growing number of channels, including personalised mail, printed documents, , SMS and websites. At the same time, postal operators are modernising and like logistics companies, are also using automated systems for processing and delivering letters and parcels. Lastly, the accelerated pace of international trade in goods and the development of e-commerce are increasing parcel flows. 16

19 2012 LANDMARKS BUILDING KEY POINT SMEs need simple solutions combining physical and digital communications, in particular regarding transactional exchanges, parcel management and marketing activities. NEOPOST INC. RECOGNISED FOR ITS CULTURE OF EXCELLENCE IN 2012 In the United States, Neopost Inc. was named All-Star Service Organization of the Year by the National Customer Service Association, which selects a company each year for its excellent customer service. KNOWING HOW OUR CLIENTS OPERATE For key account customers, Neopost has organised its sales teams by business sector, such as banking, insurance, local authorities, government bodies and national associations. Thanks to their in-depth knowledge of these sectors, sales representatives are able to help Neopost s clients to identify ways of optimising their mail and parcel activities, to implement the Group s solutions and to integrate them into their IT systems and customer relationship management. The universe of SMEs is vast, covering a wide range of sectors. The technological decisions to be made and the need to adapt how they are organised are sources of uncertainty for these businesses, many of which have limited resources in terms of IT and personnel. Understanding how they behave towards new technologies and their expectations is a challenge. The in-depth study conducted by Neopost in 2012 (see inset opposite) showed the discrepancy between the needs expressed by clients and the actual problems they face. While many businesses talk about the need to migrate to digital services, the survey highlighted the difficulties they face relating to uniting physical and digital communications. It is within this union that ways of improving their processes can be found. The study was able to distinguish three main priority areas: transactional mail, end-to-end parcel management and marketing. These are areas in which SMEs can considerably improve their efficiency and optimise costs with simple solutions. CLIENT SURVEY: In 2012, Neopost with the help of ReD Associates carried out the largest ethnographic survey ever conducted in the area of mail services. This survey allowed precise and concrete observation of small and medium-sized businesses practices. The aim was to understand in detail the processes and various aspects of mail and parcel preparation and processing, monitoring of incoming and outgoing flows, document reconciliation and management of client data. The study consisted of two stages. Firstly, a qualitative exploratory phase was carried out with around 60 in-depth interviews with Neopost clients in the major countries in which it operates (France, Germany, United Kingdom, United States), as well as businesses and sector operators in countries at the most advanced stage of digitisation, such as Denmark, Finland and South Korea. The second phase covered more than 3,000 companies in order to confirm in quantitative terms the results of the qualitative survey. 17

20 An enhanced international presence 3 2 Neopost has a very strong presence in three major parts of the globe: North America, Europe and as of recently, the Asia-Pacific region. Its products are sold in more than 90 countries. The historic driving force behind Neopost s international expansion was its policy of acquiring distributors in markets of appropriate size and growth momentum. Strategic acquisitions also help to strengthen its position in some countries. The proportion of sales generated outside France is rising steadily, reaching around 80% in By building on its direct presence, Neopost is establishing local ties with its clients and putting itself more in control of the roll-out of its sales and marketing strategy. In 2012, Neopost operated directly via distribution subsidiaries in 29 countries. GRADUALLY STRENGTHENING ITS DIRECT PRESENCE While the Group was present in just two countries in Europe in 1999, Neopost now has a commercial subsidiary in 16 European countries. Scandinavia - the last region in which Neopost established its direct presence in Europe - has seen strong growth since the Group acquired distributors in 2008 and In North America, which accounts for 40% of Neopost s sales, the direct distribution network covers 60% of the installed base. This proportion doubled between 2004 and EXPANSION IN THE ASIA-PACIFIC REGION Neopost s expansion in the Asia-Pacific region, where its direct presence was limited essentially to Japan, took a decisive step forward in 2011 with the acquisition of GBC-Fordigraph in Australia, and the creation of a regional office in Singapore. With the roll-out of the Group s sales and marketing initiatives and the acquisition of a distributor covering Indonesia, Malaysia, Singapore and Thailand, 2012 was a dynamic year in the region, in which Neopost is continuing to expand its presence. NEW MARKETS The strategic acquisitions carried out in 2012 also enabled Neopost to establish its position in countries in which it did not have direct operations, particularly where this was not justified by its traditional mail activities. With the integration of GMC Software Technology, Neopost has added to its direct presence in Brazil, China, the Czech Republic, Hungary, Mexico, Poland, Singapore and Taiwan. 1 18

21 2012 LANDMARKS BUILDING COMMERCIAL ORGANISATION INDUSTRIAL AND RESEARCH & DEVELOPMENT SITES Countries in which Neopost operates directly. UNITED STATES ➊ Memphis: Logistics platform ➋ Milford: R&D ➌ Seattle: Satori Software FRANCE ➍ Bagneux: R&D ➎ Cavaillon: Logistics systems ➏ Le Lude: Production of high-end mailing systems and logistics platform CZECH REPUBLIC ➐ Hradec Kràlové: R&D UNITED KINGDOM ➑ Loughton: R&D; Production of high-end folders/inserters THE NETHERLANDS ➒ Drachten: R&D; Production of mid-range folders/inserters MALAYSIA ➓ Penang: Subcontracting of mid-range mailing systems production CHINA 11 Jiangmen and Shenzhen: Subcontracting of low-end mailing systems and folders/inserters production VIETNAM 12 Hanoi: Subcontracting of R&D 19

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23 TECHNOLOGICAL INNOVATION FOR MAIL FLOWS 21

24 Optimised mail management In order to ensure constant improvement in the quality and performance of its mail management solutions, Neopost integrates the latest technological advances into its product ranges. The Group was a pioneer in the development of connected digital mailing systems, automated folders/inserters with vertical paper supply columns using the Load n Go application and remote diagnostics and services. Multiple connection capacities and associated service options continue to present new possibilities. Innovation is the driving force behind Neopost s momentum. Thanks to its teams of engineers with a variety of complementary areas of expertise, the Group is at the leading edge of a wide range of technologies. It also benefits from its in-depth understanding of the needs of the market. Year after year, Neopost continues to invest and has an R&D budget representing around 4-5% of its revenues. COMPREHENSIVE SOLUTIONS WITH A HIGH LEVEL OF ADDED VALUE Neopost offers comprehensive solutions comprising hardware (mailing systems and folders/inserters with accessories), software and associated services. Its broad product ranges meet all requirements, regardless of the mail volumes concerned and the applications used (commercial, marketing, administrative, etc.). The portfolio of services developed by Neopost is vast, ranging from installation to maintenance, as well as online services, for example ordering ink cartridges for mailing systems. It also comprises financial services, covering equipment leasing and postage financing in countries where mailing systems have to be pre-credited in order to be used. With its ever-improving range of services, Neopost s mail processing solutions are the most comprehensive in the market. IS A MODEL AND A DISTRIBUTION CHANNEL SUITED TO SMEs The IS-280, an entry-level mailing system, is designed for office use. It offers a variety of services such as downloading information and postal tariffs, ink level warnings and even remote diagnostics. This model is sold by remote sales teams who are particularly responsive and equipped with appropriate IT tools for this specific channel. 22

25 2012 LANDMARKS INNOVATING IN LAUNCH OF THE NEW GENERATION OF MAILING SYSTEMS In 2012, Neopost completed development of its latest generation of mailing systems and prepared for the initial launches in 2013 of the IN-360/600/700 models for processing medium volumes. The IN generation offers unparalleled connectivity capabilities and even more intuitive user interfaces. REGULARLY UPDATED RANGES OF MAILING SYSTEMS Neopost offers a comprehensive range of mailing systems, from office-environment solutions to machines with integrated dynamic scale for mail rooms. Once developed, the launch of a new generation of products entails a period of adapting each model and its embedded software to the specifications of each specific country. This can comprise calculating franking, pre-funding of the postage account or billing for consumption at the end of the period, specific inks, specific telecoms infrastructures and data management protocols. The next stage in a launch is the certification by postal services, which test the compliance with applicable standards in the country. This long process, conducted on a country-by-country basis, explains why it can take several years to roll out a new generation of machines. The IS range was first introduced in 2008 with the launch of models suitable for medium volumes. In late 2011, the entire range - from the IS-280 for volumes of envelopes a day to the IS-6000 for volumes of up to several thousand envelopes a day - had been launched in Neopost s major markets, namely Canada, France, Germany, the United Kingdom and United States was dedicated to continuing the roll-out of the range in other countries. At the same time, Neopost made preparations for its future generation of mailing systems - the IN range - the initial launch of which, concerning mid-range models, is planned for the United States in the second half of Neopost clients equipped with IS systems in 2008, when the US postal authorities withdrew their certification from old generations of non-digital machines, will be able to opt for even more efficient equipment once their lease contract ends

26 ... KEY POINT Neopost s solutions offer tangible benefits to businesses: automated mail preparation and processing improved productivity access to special tariffs lower postal costs COMPLETION OF THE ROLL-OUT OF THE RANGE OF DOCUMENT SYSTEMS The new generation of DS folder/inserter machines and associated software meets the needs of all clients, from users of office equipment to industrial mail production centres. In 2012, Neopost successfully launched the five latest models in the range, which now extends from the DS-35, which offers processing capacity of up to 1,350 envelopes per hour, to the DS-1200, able to process up to 12,000 envelopes per hour. In addition, the DS launched at the very end of 2011 and rolled out in is ideal for many businesses who previously used production systems, giving Neopost the means to win new clients. DS - 65 THE SELF-SERVICE MACHINE Whether for invoices, contracts, offers and promotions, prospectuses, client requests, brochures or miscellaneous information, mail is a major component of business communications. While digital channels are developing more and more, physical, personal mail remains a flexible and fast medium, the effectiveness of which can be measured, for example in marketing campaigns. 24

27 2012 LANDMARKS INNOVATING DS - 90 DESIGNED FOR PRODUCTIVITY, WITH A LARGE-SCREEN DISPLAY AUTOMATED MAIL PREPARATION From design to mailing, automation of the document management process allows businesses to make the most of Neopost s document and mailing systems. Use of desktop publishing software simplifies the preparation, processing and sending of mail thanks to barcodes or OMR (Optical Mark Recognition) codes marked on documents in a specific way. Document systems equipped with a barcodes reader compile, fold and insert the various contents selectively and intelligently. The most comprehensive configurations allow automatic retrieval of documents to be put into envelopes by connecting a printer to the document system. Interfaces also allow the machine to be connected to a mailing system that processes envelopes of various formats, weighs on a continuous basis and applies the postmark and, if applicable, the postal information. A NEW SOLUTION SPECIFICALLY FOR POSTAL OPERATORS Neopost also supplies solutions intended specifically for postal operators. In 2012, in partnership with PostNL, Neopost developed a new range of applications for the processing of problematic mail flows requiring manual sorting, such as returns to sender, reply envelopes and letters with insufficient postage. 25

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29 ENHANCING THE RANGE OF SERVICES OFFERED TO OUR CLIENTS 27

30 Effective management of customer communications GMC Software Technology With the acquisition of GMC Software Technology in July 2012, Neopost took a major step forward in the integrated and coordinated management of various customer communications tools. GMC s renowned technology and expertise will enable the Group to offer complementary services to its existing clients. GMC Software Technology is market leader in the preparation and management of customer communications, and offers solutions that allow for the integrated creation and management of incoming and outgoing flows, regardless of the medium and distribution channel used (e.g. paper, , fax, SMS, website or social networking sites). With GMC Inspire - GMC s software suite - businesses can communicate effectively with each client via the channel of his choice. 1,200 clients worldwide 300 employees including 130 engineers GMC SOFTWARE TECHNOLOGY: A SPECIALIST IN CLIENT COMMUNICATIONS The GMC Inspire software suite is at the cutting edge of technology and is intended for multichannel communications for both business transactions and promotions. It facilitates the creation and production of documents adapted to every medium. It also helps to optimise postal costs and manage on-demand communications, such as sending prospectuses, manuals, contracts and invoices. GMC Software Technnology is very close to its clients, with an offering that goes much further than selling software licences, covering research and implementation of customised solutions and maintenance. STRONG DYNAMIC FOR SUCCESS Based in Switzerland since it was founded in 1994, GMC Software Technology currently has a direct presence in around 20 countries in Europe, the Americas and Asia. Its services are sold to major clients producing large document volumes. It has over 1,000 clients that can produce in excess of 100 million personalised documents each month. GMC Software Technology has seen strong growth in its activities over the last few years thanks to its successful strategy of developing its presence among print service providers, a client segment in which it already has very high market share. More recently, the company has begun to develop its presence in banking, insurance and other vertical markets. Capitalising on the strategic fit between its services and Neopost s business lines, GMC Software Technology s very brisk growth has been stepped up even more since it was integrated into the Group in mid

31 2012 LANDMARKS INTEGRATING KEY POINT In its report on Document Output Customer Communication Management companies published in 2011, Forrester Wave classified GMC Software Technology as one of the sector leaders. DEDICATED APPLICATIONS GMC Software Technology s latest application based on its Inspire platform is a dedicated solution for financial institutions communications with their customers. It allows for bank statements to be presented in a dynamic and attractive way using interactive charts and tables, with an analysis function allowing each customer to view the information they want with the level of detail of their choice. These statements can be viewed on a PC or on a tablet computer. This solution allows financial institutions to monitor how statements are used and to use this analysis to define customised services and send them selectively to each customer. GMC SOFTWARE TECHNOLOGY S CLIENTS Print service providers, banks and insurance companies, large-format retailers, business services, telecommunications, electricity and gas suppliers, public and healthcare services. SERVING CUSTOMER COMMUNICATIONS A business s relationship with its customer is the cornerstone of its success, regardless of its size or sector, both in order to increase customer loyalty and win new clients. Ongoing work on addressing the challenge of customer communications has increased even more in the face of new behaviour patterns, with people becoming less loyal, more demanding and increasingly sought after. People want to receive information at a time and in a format that suits them, according to the channel of their choice, whether mail, fax, SMS, or via the internet. Successful management of customer communications requires an increasing level of responsiveness, the ability to produce relevant content and process ever-larger volumes and interaction between the company s various departments. This complexity means that it is essential to use software tools to help to design documents and manage customer communications. NUMEROUS COMMERCIAL SYNERGIES The integration of GMC Software Technology has opened up the possibility of beneficial commercial synergies for the Neopost group. The GMC Inspire platform extends the services offered to clients of high-end folders/inserters. Soon after the acquisition, the Neopost network began to promote it to its clients and a number of contracts were signed in At the same time, Neopost s sales staff increased their access to the mail production companies with which GMC has formed close ties. Adaptation of the GMC Inspire platform will allow for the effective replacement of the PrintMachine services offered by Neopost to its clients in the area of document preparation and management. Neopost will also rely on GMC Software Technology to develop a new generation software package in SaaS (Software as a Service) format for SMEs. Lastly, GMC s software suite fits in fully with the address and data quality management software of Satori Software and Human Inference, two subsidiaries of the Neopost group (see pages 30 and 31). 29

32 High quality data COMPLEMEN- TARY BUSINESS LINES The Group s data quality management offering presents significant commercial synergies with GMC Inspire, the software suite sold by GMC Software Technology, Neopost s specialist customer communications subsidiary. Neopost has enhanced its expertise in the area of data quality management. Its first steps into this activity were in 2009, when the Group acquired Satori Software in the United States, a company specialising in address quality and one of the market leaders in postal data management tools. In 2012, Neopost enlarged its offering further with the roll-out of Satori s new software ranges, partnership agreements and the acquisition in November of Human Inference, a specialist in master data management (see inset on opposite page). DATA - AN ASSET THAT DESERVES TO BE MANAGED With increasing computerisation, the quality of data - its validity, its security and its availability - is a sensitive issue for businesses. The influx of information into IT systems, collected in different formats and at multiple entry points, results in the accumulation of data, which in some cases is incorrect or incomplete and difficult to reconcile. In the light of these challenges, potential improvements in performance and avoidable additional costs, the data quality market is gaining momentum rapidly and many businesses do not yet have the necessary tools. In this sector, the performance of solutions, their ability to be integrated into users systems and the quality of customer support are key in making providers stand out. These are the criteria applied by Neopost when deciding to make an acquisition or form a partnership. SATORI SOFTWARE, AN EXPERT IN ADDRESS QUALITY MANAGEMENT The software developed by Satori Software helps businesses to collect, manage and use address databases that are accurate and up to date. For example, they respond to the increasingly sophisticated needs relating to direct marketing campaigns or mailing campaigns. The software checks and updates information when it is entered into the company s databases, on its website or while it is being used. Addresses are corrected by ensuring that they comply with standards and post office requirements. Using this software helps to reduce the amount of undelivered mail. Furthermore, in some countries, the address cleansing and preliminary sorting using Satori s software ahead of printing provides access to preferential postal tariffs. DATA 30

33 2012 LANDMARKS INTEGRATING KEY POINT Human Inference was positioned as visionary in the Gartner Magic Quadrant for Data Quality Tools sector in April EXPANSION OF SATORI SOFTWARE S OFFERING With the launch of its software in the United Kingdom and the partnership formed in early 2012 with Uniserv for other countries, Satori Software s address correction services are now available to Neopost clients all over Europe. In October 2012, Satori Software became the exclusive supplier in the United States of SAP s Postalsoft Presort package and continues to supply the full suite of SAP s BusinessObjects Postalsoft solutions under the partnership agreement signed with SAP America in late At the end of the year, Satori Software enhanced its product range with the inclusion of Monticello Software Incorporated s suite of pre-delivery software. It now offers a full suite of software for data quality management, pre-sorting and pre-delivery optimisation, tracking and dynamic entry planning. HUMAN INFERENCE, A SPECIALIST IN MASTER DATA MANAGEMENT Human Inference s solutions allow all data available on a customer to be combined in a single database. These solutions can be used in all languages and adapted to all cultures, and allow significant improvement in the performance of sales and marketing plans, operating efficiency, customer risk management and compliance with regulatory requirements. Human Inference s client base consists of banks, insurance companies and other large businesses in a variety of sectors, such as ABN AMRO, Center Parcs, E-ON, ING Bank and Nutricia. Founded in 1986 in Arnhem, Human Inference is a Dutch company with 40 employees. Its integration into the Neopost group has opened up new possibilities for geographical expansion, having previously focused its activities on the Benelux region. Furthermore, its solutions fit in perfectly with the postal address management tools developed by Satori Software. MASTER DATA MANAGEMENT: THE VALUE OF A SINGLE REFERENCE SYSTEM Master data management addresses the problems of data aggregation. It allows a unique reference system to be created to manage all the data essential to a company s activities. Compiling and maintaining databases generated or used by sales, marketing, accounting and even legal departments is a pre-requisite for the efficient running of a business and for the various departments to work in synergy. Specifically, the challenge is ensuring uniformity, checking the relevance of data, avoiding repetitions and keeping the database up to date. This standardised reference system is then used by each of the company s divisions. 31

34 Technologies for tracking parcels and goods 100,000 companies using Neopost shipping solutions worldwide Via its subsidiary Neopost ID, Neopost supplies shipping and tracking solutions for parcels and other goods. These solutions are based on advanced technologies provided by Neopost ID for the capture, processing and retrieval of information. They are designed for the Group s carrier and logistics clients, as well as postal organisations, manufacturing companies and distributors. In Europe, Asia and Australia, 2012 was an eventful year for Neopost ID, with the development and extension of projects with existing clients, postal operators and carriers, new solutions to address the problem of the last mile and the development of pilot projects for 2013 concerning radically new services targeted at SMEs. Under buoyant market conditions thanks to strong growth in trade of goods and e-commerce, Neopost continued to enhance its portfolio of parcel management solutions. 5 million parcels prepared for dispatch each month on Neopost servers 6 million parcels tracked each month by Neopost mobile solutions INTEGRATING ADVANCED TECHNOLOGIES Tracking is a key component of the processing of parcels, registered letters and various goods, such as items of value and spare parts. The solutions offered by Neopost ID are based on its technological expertise and proven achievements in a number of areas such as the internet, mobility, barcodes, RFID (Radio Frequency Identification), digitalisation and EDI (Electronic Data Interchange). Neopost ID is able to monitor data and provide relevant information in real time and in the right format through the appropriate media ( , SMS, website etc.) even when these applications are part of a complex supply chain involving a number of parties (manufacturer, carrier, logistics provider, retailer, etc.). MANAGED SERVICES TRACEABILITY SOLUTIONS Bespoke solutions are supplied in Managed Services mode, including all components of the project: hardware and software selected according to the client s needs, hosting and retrieval of collected data, roll-out and interfacing of solutions with the client s IT systems. This is the case for Collect n Deliver, the real-time mobile traceability solution for items from collection to delivery. It is based on industrial mobile handsets equipped with barcode readers to track the parcel and capture the recipient s digital signature. This solution is used by Chronopost, France s leading parcel transport company. 32

35 2012 LANDMARKS INTEGRATING KEY POINT By capitalising on its cyberstation OSS technology, Neopost ID develops new online services for small and medium-sized businesses offering features which were previously only available to major clients via specific applications. SHIPPING SOLUTIONS FOR SMEs Pilot initiatives have been launched in France and Germany and others are planned in Canada and in the United States. The applications allow users to compare and buy parcel-sending services online while benefiting from prices pre-negotiated with carriers. In France, these services are offered in partnership with Chronopost, ColiPoste, DHL, Fedex and UPS. AUTOMATED PARCEL LOCKERS FOR AUSTRALIA POST To offer a simple and secure service for clients wanting greater flexibility in receiving parcels, Australia Post has decided to install parcel lockers open 24 hours a day, seven days a week, located within 10 minutes drive for 80% of the metropolitan population. This service represents a way of saving time and improving efficiency for Australia Post, which no longer depends on recipients being at home to make deliveries. Building on its collaboration with Australia Post, Neopost acted as prime contractor for the whole project, which plans to install 250 automated and secure parcel lockers between now and the end of of these lockers were installed in To be able to access the service, the recipient of a parcel simply needs to register online. He then receives a personal code by or SMS, which he needs to enter into the touch screen on the automatic locker to open it and retrieve the parcel left by Australia Post. IN 2013, AN RFID SOLUTION FOR THE FRENCH ARMED FORCES SHIPPING MANAGEMENT WITH CYBERSTATION OSS Neopost enjoys close relationships with carriers and postal operators. It has successfully developed and deployed national and international parcel sending services for Royal Mail in the United Kingdom (Despatch Manager Online) and for Australia Post (Click & Send). Neopost ID continues to develop its online platform for the preparation and labelling of transport orders. In 2012, Singapore Post used Neopost ID s cyberstation OSS to develop its Ezy2ship solution for the preparation of parcels and registered letters using an internet browser. In partnership with Cap Gemini and BearingPoint, Neopost ID is to use its expertise in RFID technology in SILRIA, the dedicated IT system for managing the transportation and tracking of equipment for the French Ministry of Defence. Neopost ID will supply the technology and identification and tracking solutions (RFID tag encoders, barcode printers, tag-reading equipment, reader gates for lorries and portable ground readers), as well as the associated software and their interfaces with the IT system. A pilot phase will take place in 2013 followed by a roll-out in

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37 RECONCILING ECONOMIC, SOCIAL RESPONSIBILITY AND ENVIRONMENTAL CONCERNS 35

38 Responsibilities and commitments Neopost is committed to fulfilling its responsibilities to its stakeholders: clients, partners and the communities among which its teams operate. Its growth is based on strong values of ethics, recognition and entrepreneurial spirit, innovation and environmentally-friendly design. Acting as a civic-minded company is a duty for the Group and each of its subsidiaries. Each Group entity is responsible for implementing Neopost s Corporate Social Responsibility (CSR) policy in accordance with applicable legislation in the country in which it operates. On joining the Group, each employee is informed of Neopost s requirements in terms of social, environmental and civic concerns, which are set out in a charter of values. The CSR steering committee is headed by the Group s Health and Safety officer, who reports directly to the Chairman and Chief Executive Officer. It is made up of representatives of the various Group entities, the head of Human Resources and the head of Investor Relations. THE KEY STAGES OF NEOPOST S CSR APPROACH 2004: Start of ISO certification for R&D and production sites and distribution subsidiaries 2005: Publication of the Neopost guide to product eco-design 2006: Start of OHSAS certification 2007: Extension of the CSR steering committee: integration of Human Resources and Investor Relations 2008: Audit of the Group s CSR practices 2010: Group s charter of values extended to all social, ethical, human resources and environmental aspects 2012: Neopost white paper: A sustainable approach for sustainable development 36

39 2012 LANDMARKS GROWING IN 2012 Neopost stepped up the recycling and remanufacturing elements of its product eco-design policy. Re-using components helps to reduce energy costs and the carbon footprint of manufacturing processes. KEY POINT The Group s procedure for collecting and treating waste electrical and electronic equipment (WEEE) resulted in 92% of waste collected being sent to recycling facilities in A STRONG ENVIRONMENTAL COMMITMENT Neopost endeavours to reduce the impact of its activities on the environment. Its eco-design approach is the cornerstone of its development policy. This consists of taking account of the impact of a product over the whole of its life cycle in relation to all environmental aspects. Neopost s eco-design guide sets out a number of priorities, including choice of materials, the number of components, the relationship between the products mass and packaging volumes, noise levels, energy consumption, and end-of-life recyclability and dismantling. Applied to the development of the generation of IS mailing systems, the eco-design approach has allowed for a much lower environmental impact relative to the previous range. The IS-480 model launched in 2008 was the first concrete achievement. Compared with the IJ-70 - the equivalent model in the previous generation - the machine s weight was reduced by over 40% and the number of components reduced by around 10%. The recyclability rate of the IS-480 was increased to 76% compared with 48% for the IJ-70. THE FIRST ECO-DESIGNED MAILING SYSTEM IS The approach was then extended to other projects, as well as the range of document systems. The DS-35, the latest-generation document system suitable for low volumes presents a recyclability rate of over 80%, is seven times more energyefficient than the previous model and offers an optimum packaging volume ratio relative to the volume of the product. In addition to the product itself, Neopost s approach also applies to design processes, manufacturing and even transport. For machines coming out of the production plant, transportation by boat is one of the ways of reducing CO 2 emissions. This criterion also dictates the Group s choice of vehicles. In 2012, an energy audit of the Le Lude production site was able to identify ways of reducing energy consumption and define a plan of action. Neopost has also set itself the priority of providing users with equipment allowing them to reduce the environmental impact of their activities. Its ecolabel provides a way of communicating to clients about the environmental performance of its products. Lastly, the Group takes initiatives relating to use of the product, such as collecting and recycling used ink cartridges or the remanufacturing of machines taken back at the end of the contract

40 ... KEY POINT The Group publishes a quarterly internal newsletter called NNN, Neopost Network News. This helps to bring together the Group s employees who are based rightaround the world. TO OUR EMPLOYEES, WHO ARE KEY TO NEOPOST S SUCCESS The Group maintains regular dialogue with its employees and their representatives. On a local level, each legal entity is required to set up bodies for dialogue and communication with its employees in accordance with applicable legislation in the country. Neopost devotes a considerable amount of effort to training, giving a high level of priority to innovation and entrepreneurial spirit, as well as management skills. Training plans and skills development are managed at the level of each entity. Engagement surveys conducted every two years allow employees to express their views. They provide the opportunity to make suggestions concerning the Group s organisation and the working environment. The results are analysed by an external firm and are used to implement concrete action plans. The fourth survey took place in May 2012 and was extended to three new countries: Australia, Hong Kong and Japan. The participation rate was high at 85%. The Group implements cross-functional programmes, such as the Neopost University, developed in partnership with French business school HEC and intended for around 40 management-grade staff from Neopost s various entities each year. In 2012, the training programmes managed by the Human Resources departments of the Group s various entities amounted to a total of more than 85,000 hours and enabled 4,153 employees - equal to 72% of the total number of full-time equivalent employees - to benefit from at least one training session. Neopost and its subsidiaries are committed to supporting cultural, ethnic and social diversity. In France, a Neopost diversity charter has been drawn up and ratified by the Group s French entities, which are committed to promoting measures to combat discrimination. Multi-site projects bring together employees with varied skills and experience. Staff transfers between Group companies, both locally and abroad, are encouraged. The Group favours diversity at all levels. Women make up one-third of the workforce and one-quarter of managers. Neopost aims to provide all employees with an interest in the company s earnings, in particular through a variable portion of their compensation, profit-sharing agreements, as well as stock option and bonus share programmes. A number of initiatives both at Group level and by subsidiaries aim to foster the spirit of innovation and promote employees ideas. A dedicated section in the NNN quarterly newsletter provides internal information about the best ideas and achievements. 38

41 2012 LANDMARKS GROWING A SAFE AND HEALTHY WORKING ENVIRONMENT Neopost has implemented a certification programme in accordance with OHSAS standards. At present, all of the production plants in Drachten (The Netherlands), Loughton (United Kingdom) and Le Lude (France) and the main commercial subsidiaries have now obtained this certification. TO PARTNERS, SHARING COMMON CHALLENGES Neopost operates on good terms with postal organisations, distributors, suppliers and all other commercial partners. The Group selects its suppliers carefully for their specific know-how and expertise. The Group s main suppliers and subcontractors must have ISO and OHSAS certification, and be committed to complying with International Labour Organization conventions, United Nations resolutions and local legislation on environmental protection and working conditions. The Group s Purchasing department ensures that suppliers and subcontracting partners are carefully monitored. Relationships with the Group s main suppliers are based on frequent contact and discussions, during which the mutual interests of the companies are reviewed and discussed. TO THE COMMUNITY: LOCAL INITIATIVES Neopost has a direct presence in 29 countries and most of its employees are recruited locally. The Group attaches a great deal of importance to establishing close relations with clients and local communities. Its subsidiaries spearhead local initiatives intended to support charitable associations and organisations providing social assistance. The Close to our Customers, Close to our Communities programme aims to support employees contributions. In France, since 2007, Neopost has paid 5 for each mailing system rental contract signed to SOS Villages d Enfants, an organisation that allows brothers and sisters who are unable to live with their parents to grow up together within village communities. In the United States, the Bikes for Tykes scheme is one of the initiatives that has been running for several years. Employees of Neopost USA organise collections to buy bicycles for an association that helps families in Connecticut. A total of 1,000 bicycles have been donated in this way in the last 10 years. IN 2012 In the United Kingdom, Neopost UK won the National Apprenticeship Award, a prize given to organisations for the quality of their training programmes. Since 2009, the Neopost subsidiary has taken on young people on apprenticeship contracts. Of the 25 young people who have benefited from the scheme, 18 have had their contracts converted into permanent contracts. 39

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43 GROWTH AND PROFITABILITY 41

44 Neopost on the stock market NEOPOST S NEW REPORTING SYSTEM Gaële Le Men Investor Relations Tel.: [email protected] Neopost s activities are now divided into two categories. Revenues from mail-related activities are consolidated within Mail Solutions, while revenues from non-mail related activities are grouped together under Communication & Shipping Solutions (CSS). Mail Solutions and Communication & Shipping Solutions (CSS) present different outlooks in terms of sales growth. Revenues for the Mail Solutions category are generated by the Neopost network: Neopost Integrated Operations. Revenues for the Communication & Shipping Solutions (CSS) category come from sales generated either by the Neopost network from its existing client base, or directly by our specialist subsidiaries - CSS Dedicated Units - from key account clients. Neopost Integrated Operations and CSS Dedicated Units generate different levels of operating margin. Neopost has adopted a new segmented reporting system for its financial information that will be used from the start of the 2013 financial year. This will provide greater visibility of the Group s strategy while also reflecting its functional organisational structure. The new segmented reporting system should make our financial communications even more pertinent. DEFINITIONS: - Mail Solutions: Mailing systems, document systems (desktop, professional and production folder/inserters, other mailroom equipments) and related services. - Communication & Shipping Solutions (CSS): Data quality, customer communication management, shipping solutions, print finishing and graphic solutions. - Neopost Integrated Operations: Neopost operating companies engineering, producing and distributing Neopost products and services. - CSS Dedicated Units: GMC Software Technology, Human Inference, Neopost ID, Satori Software. 42

45 2012 LANDMARKS DELIVERING 3.90 Proposed* dividend per share in respect of 2012 (to be paid entirely in cash) 7.7% Yield based on share price as of 25 April % Payout ratio * To be submitted to shareholders for approval at the AGM of 2 July 2013 SHAREHOLDING STRUCTURE Directors, management and employees: 2.2% Treasury shares: 0.5% Individual shareholders: 5.0% Institutional investors: 92.3% PUBLICATIONS CALENDAR 3 June 2013*: First quarter sales 2 July 2013: AGM 5 September 2013*: Second quarter sales 30 September 2013*: Interim results 2 December 2013*: Third quarter sales 31 January 2014: End of the fiscal year March 2014*: Fourth quarter sales March 2014*: Full-year results * Published after closing of the Euronext Paris Premier Marché A large proportion of Neopost s shareholders are international institutional investors who break down as follows: 42% in North America, 31% in the United Kingdom and Ireland, 16% in France and 11% in the rest of Europe. SHARE PRICE 23 February 1999 Neopost: 15.0 SBF 120: 2, April 2013 Neopost: SBF 120: 2,954 Change Neopost: +240% SBF 120: +4.7 % Source: FactSet

46 Performance in bn Sales +2.5% Change in sales at constant exchange rates SALES million In 2012, Neopost achieved sales growth of 6.7% or 2.5% at constant exchange rates. The scope effect relating to the acquisitions of GBC- Fordigraph in 2011 and GMC Software Technology and Human Inference in 2012 accounted for an increase of 3.3%, while organic growth was -0.8%, or virtually flat if we do not take account of the decline in revenues relating to postal rate changes. SALES BY BUSINESS LINE Mail Solutions: 87% Communication & Shipping Solutions: 13% Development of non-mail related activities gained pace. The proportion of sales generated by Communication & Shipping Solutions increased from 8% to 13% in the space of one year. This relates to the scope effect linked to acquisitions - in particular GMC Software Technology - as well as the strong organic growth achieved by all of these activities. SALES BY REGION North America: 39 % France: 22 % United Kingdom: 12 % Germany: 7 % Rest of the World: 20 % Sales fell by 2.5%* in North America as a result of a reduction in 2012 in the number of leasing contracts coming to expiry. In France, sales were down 7.4%, affected by the merging of the two distribution subsidiaries. In all other regions, sales increased as follows: up 2.0%* in the United Kingdom, up 6.0% in Germany and up 29.6%* in the rest of the world, thanks in particular to strong growth in the Asia-Pacific region. SALES BY REVENUE TYPE Hardware sales: 69 % Recurring revenues: 31% The specific situations in North America and France weighed down hardware sales, which increased by just 0.4%*. Meanwhile, recurring revenues increased by 3.4%*, thanks primarily to higher leasing revenues and despite lower revenues relating to postal rate changes than in The proportion of recurring revenues (services, supplies, leasing and financing) remained particularly high. *Change relative to 2011 at constant exchange rates 44

47 2012 LANDMARKS DELIVERING 24.9% Current operating margin before acquisition-related expenses 3.90 Proposed** dividend ** To be submitted to shareholders for approval at the AGM of 2 July 2013 CURRENT OPERATING INCOME million Current operating income increased slightly in Before acquisition-related expenses, current operating margin was 24.9% compared with 25.6% in The Group s operating margin therefore remained at a high level. The slight deterioration in operating margin was mainly due to an increase in social security contributions in France, lower revenues from postal rate changes and strong sales growth in activities or regions generating lower margins, in particular Communication & Shipping Solutions and the Asia-Pacific region. RETURN TO ORGANIC GROWTH While sales growth at constant exchange rates was zero at the end of the first half of the year, the third and fourth quarters saw growth of 2.6%* and 6.6%* respectively. The integration of GMC Software Technology in July followed by that of Human Inference in December contributed to this. However, the end of the year was also characterised by a return to organic growth of 2.6%* in the fourth quarter, thanks to the combined effect of strong growth in Communications & Shipping Solutions and a less severe decline in hardware sales in North America and France. NET ATTRIBUTABLE INCOME million Net income Group share rose by 4.5% in Net margin was maintained at 15%. The successful refinancing carried out over the course of the year enabled the Group to control its financial result - which amounted to million euros in and extend its average debt maturity from less than two years to more than four years. NET DEBT/EBITDA*** Neopost is in a healthy financial position. Its equity has been strengthened further and debt is used to finance equipment installed with customers. Even though net debt increased following the acquisitions of GMC Software Technology and Human Inference, it is still below the level of future leasing and rental revenue flows. The net debt/ebitda ratio has seen little change. ***EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortisation 45

48 Summarised financial statements million and % of sales CONSOLIDATED INCOME STATEMENT (year ended ) (year ended ) Sales 1, % 1, % Cost of sales (238.0) (22.2)% (222.3) (22.2)% Gross marging % % R&D expenses (33.0) (3.1)% (30.0) (3.0)% Selling expenses (269.1) (25.2)% (246.1) (24.6)% Administrative and general expenses (165.2) (15.4)% (151.8) (15.1)% Maintenance and other expenses (89.8) (8.4)% (86.4) (8.6)% Employee profit-sharing and share-based payments (8.2) (0.8)% (9.5) (0.9)% Current operating income % % before acquisition-related expenses Acquisition-related expenses (6.8) (0.6)% - - Current operating income % % Gain/(losses) on disposals and others (0.1) Optimisation expenses (4.0) (0.4)% (19.5) (1.9)% Operating income % % Net financial income/(expense) (30.4) (2.8)% (27.6) (2.8)% Income before taxes % % Income taxes (64.5) (6.0)% (55.4) (5.6)% Income from associates % Net income % % Minority interests 0,7 0,1% 1,0 0,1% Net attributable income % % 46

49 2012 LANDMARKS DELIVERING CONSOLIDATED BALANCE SHEET SUMMARY Assets million Goodwill Intangible assets Property, plant and equipment Other non-current financial assets Lease receivables Other non-current receivables Deferred tax assets Inventories Trade receivables Other current assets Financial instruments Cash and cash equivalents TOTAL ASSETS 2, ,242.9 Liabilities million Shareholders equity Non-current provisions Non-current financial debt Other non-current liabilities Current financial debt Deferred tax liabilities Non-current financial instruments Prepaid income Current financial instruments Other current liabilities TOTAL EQUITY AND LIABILITIES 2, ,242.9 Summarised financial statements are part of Neopost Registration document, which was filed with the AMF on 29 April It is available on request from the company or in the Regulated information/periodic information/annual reports section of the Group website. 47

50 Editorial and writing: Neopost DDB Financial Graphic design and production: Marie-Louise Illustrations: Romualdo Faura Photos: Philippe Zamora (pages 7 to 11 and 42) & Neopost s photographic library Printed on Recycled Paper Cocoon

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