Sopra Steria Group (SOP) H1 2025 earnings summary

Executive summary

• Revenue for H1 2025 was €2.84 billion, reflecting an organic contraction of 3.8% year-over-year, with sequential improvement from Q1 to Q2.

• Net profit attributable to the Group rose 15.3% to €142 million, with net margin up to 5% of revenue and EPS increasing 19.2% to €7.29.

• Free cash flow was negative at -€145.9 million due to seasonal effects and delayed receivables collection, but annual FCF guidance is maintained.

• Major contract wins in defense, public sector, and digital services, including NHS, SNCF, Statnet, Equinor, and Societe Generale, reinforce positioning in sovereignty and cybersecurity.

• Strategic focus on defense, security, and sovereignty, with 68% of revenue from public sector, aerospace/defense, and financial services.

Financial highlights

• Operating margin on business activity was 9.2%, down from 9.7% in H1 2024 but above H2 2024.

• Operating profit on business activity was €261.4 million (9.2% margin), down from €285.3 million (9.7%).

• Net financial debt at €696.8 million, representing 34% of equity and 1.17x pro forma EBITDA.

• Basic earnings per share increased to €7.29 from €6.11 year-over-year.

• Effective tax rate rose to 23.7% from 15.7% due to non-recurring UK tax proceeds in prior year.

Outlook and guidance

• Full-year 2025 guidance confirmed: organic revenue growth between -2.5% and +0.5%, operating margin on business activity 9.3–9.8%, FCF 5–7% of revenue.

• Gradual improvement expected in H2, with a return to slight organic revenue growth in Q4 2025.

• Confident in meeting annual targets, with focus on margin management, cost control, and DSO reduction.

• Tax rate expected to be 27% for 2025, including a 1-point impact from an exceptional surtax in France.