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Neopost: 2012 Fourth-Quarter Sales

  Neopost: 2012 Fourth-Quarter Sales

STRONG GROWTH IN FOURTH QUARTER OF 2012

  *Fourth-quarter sales up 8.2% or 6.6% at constant exchange rates
  *Full year 2012 sales up 6.7%, or 2.5% excluding currency effects

OUTLOOK:

  *2012 current operating margin, before acquisition-related expenses,
    confirmed as slightly under 25% in 2012
  *2013 sales expected to grow by at least 5% at constant exchange rates

Business Wire

PARIS -- March 4, 2013

RegulatoryNews:

Neopost (Paris:NEO), the European leader and the world's number-two supplier
of mailroom solutions, today announced consolidated sales of €299.8 million
for the fourth quarter of the 2012 financial year (ended 31 January 2013), an
increase of 8.2% on the fourth quarter of 2011. At constant exchange rates,
sales were up 6.6%. In particular, Neopost benefited from the acquisitions of
GMC Software Technology, a company specialising in customer communication
management, and Human Inference, a company specialising in data quality, which
have been consolidated since July 2012 and December 2012 respectively.

Over the full financial year, sales totalled €1,070.0 million, up 6.7%
relative to the 2011 financial year, or 2.5% excluding currency effects.

Denis Thiery, Chairman and Chief Executive Officer of Neopost, commented: “We
enjoyed a return to strong growth in the fourth quarter. In the USA, the
re-allocation of our commercial targets has started to bear fruit. In France,
the situation has continued to improve as the new organization of our
distribution becomes increasingly efficient. In other markets, Neopost’s
dynamic growth continues. Meanwhile, the integration of GMC Software
Technology and of Human Inference is proceeding remarkably well.”

Sales by region

                                                           
                                   Change                                  Change
€         Q4      Q4               at                                      at
million                Change  constant   2012     2011     Change  constant
          2012    2011             exchange                                exchange
                                   rates                                   rates
North    112.6  110.9  +1.6%   -0.5%      419.2    399.6    +4.9%   -2.5%
America
France   66.3   67.3   -1.5%   -1.5%      236.3    255.2    -7.4%   -7.4%
UK       32.8   30.8   +6.3%   +2.7%      125.5    115.8    +8.4%   +2.0%
Germany  23.0   20.9   +9.8%   +9.8%      78.3     73.8     +6.0%   +6.0%
Rest of
the      65.1   47.1   +38.2%  +36.2%     210.7    158.2    +33.2%  +29.6%
world
Total    299.8  277.0  +8.2%   +6.6%      1,070.0  1,002.6  +6.7%   +2.5%

(Unaudited figures)

North America

The situation in North America continued to improve over the course of the
fourth quarter. The redeployment of the sales force to focus on document
systems paid off. Even so, sales in the fourth quarter of 2012 were down very
slightly, at 0.5% below the fourth quarter of 2011 excluding currency effects.
This dip was due to the fact that the fourth quarter of 2011 saw strong sales
linked to the end of the echo effect of the 2006 decertification programmes,
along with a boost to revenues from postal rate changes that was greater than
that seen in the fourth quarter of 2012.

Over the full year, sales were down by 2.5% at constant exchange rates.

France

The situation in France also continued to improve over the course of the
fourth quarter. The new sales organisation structure resulting from the merger
of the two distribution subsidiaries, Neopost France and Satas, continued to
make efficiency gains and the level of new orders in the fourth quarter of
2012 was higher than in the previous three months. Over the quarter, the Group
also benefited from revenue relating to a postal rate change and from strong
business levels at Neopost ID (logistics solutions). Even so, sales in the
fourth quarter of 2012 were down 1.5% on the fourth quarter of 2011.

Over the full year sales were down 7.4%.

UK

Against a background of tough economic conditions, sales were up 6.3% in the
fourth quarter of 2012, or by 2.7% at constant exchange rates.

Over the full year, sales were up 8.4%, or 2.0% at constant exchange rates.

Germany

Neopost continued to generate sales growth in the fourth quarter of 2012.
Sales were up 9.8%.

Over the full year, sales were up 6.0%.

Rest of the world

Sales in the rest of the world grew by 38.2%, or 36.2% at constant exchange
rates, in the fourth quarter of 2012. This strong growth came as a result of
the consolidation of GMC Software Technology and of Human Inference, as well
as from good performances in the Asia-Pacific region.

Over the full year, sales were up 29.6% at constant exchange rates.

Sales by business line and revenue type

                                                             
                                     Change                                  Change
            Q4      Q4               at                                      at
€ million                Change  constant   2012     2011     Change  constant
            2012    2011             exchange                                exchange
                                     rates                                   rates
Equipment  99.2   91.8   +8.1%   +6.3%      332.6    317.3    +4.8%   +0.4%
sales
Recurring  200.6  185.2  +8.3%   +6.8%      737.4    685.3    +7.6%   +3.4%
revenues
Total      299.8  277.0  +8.2%   +6.6%      1,070.0  1,002.6  +6.7%   +2.5%

(Unaudited figures)

Equipment sales were up 8.1% in the fourth quarter of 2012, or 6.3% excluding
currency effects. This growth came from the consolidation of GMC Software
Technology (licence revenues) and from the good performance in the
Asia-Pacific region. In France and the USA, despite an improvement compared to
previous quarters, equipment sales remained below their levels in the same
period in 2011. Over the full year, equipment sales were up 0.4% at constant
exchange rates.

Recurring revenues rose by 8.3%, or 6.8% excluding currency effects, thanks in
particular to growth in leasing income and the consolidation of GMC Software
Technology and Human Inference (maintenance and service revenues). Over the
full year, recurring revenues were up 3.4% at constant exchange rates, and
represented 68.9% of total sales.

                                                             
                                     Change                                  Change
            Q4      Q4               at                                      at
€ million                Change  constant   2012     2011     Change  constant
            2012    2011             exchange                                exchange
                                     rates                                   rates
Mailing    187.0  186.3  +0.4%   -0.4%      696.0    681.9    +2.1%   -2.1%
systems
Document
and        112.8  90.7   +24.3%  +21.0%     374.0    320.7    +16.6%  12.1%
logistics
systems
Total      299.8  277.0  +8.2%   +6.6%      1,070.0  1,002.6  +6.7%   +2.5%

(Unaudited figures)

Mailing systems sales were almost flat in the fourth quarter of 2012 compared
to the fourth quarter of 2011 (-0.4% excluding currency effects). Neopost
benefited in the fourth quarter of 2012 from a higher level of revenues
relating to postal rate changes than in the same period in 2011. However, in
the fourth quarter of 2011 the Group had seen strong business levels relating
to the ending of the echo effect from decertifications in 2006 in North
America.

Over the full financial year, mailing systems sales were 2.1% lower at
constant exchange rates.

Growth in sales of document and logistics management systems continued in the
fourth quarter with a 24.3% increase, +21.0% at constant exchange rates. This
growth came from strong trends in the Rest of the World region and from the
positive effect of the consolidation of GMC Software Technology and Human
Inference.

Over the full year 2012, excluding exchange-rate effects, document and
logistics management system sales grew by 12.1% and accounted for 35.0% of
total Group sales.

Development of businesses not related to mail

The integration of GMC Software Technology (acquired in July 2012) is
proceeding remarkably well. Its strategy of developing its business in the
banking and insurance industries and other vertical markets is being pursued
with success and sales are growing strongly.

Human Inference, a European leader in the data quality field, has been
consolidated since December 2012. The integration of this company is
proceeding extremely well.

In logistics, Neopost saw strong business levels in the fourth quarter. Most
notably Neopost started installing automated secure parcel lockers for
Australia Post. As previously indicated, this contract will generate sales of
around 11 million Australian dollars (i.e. around €9 million) over three
years, with two thirds due to come in 2013.

Outlook

Neopost has confirmed that it expects current operating margin, before
acquisition-related expenses, to be slightly below 25%.

In the mail-related business in 2013, Neopost expects improved performances in
the USA and France and continued expansion in the Asia-Pacific region. In its
businesses not related to mail, the Group is expecting to see the benefits
from organic growth in these areas together with the commercial synergy
expected from the recent acquisitions of GMC Software Technology and Human
Inference. Although economic conditions remain difficult, the Group expects
sales growth for the year 2013 of at least 5% at constant exchange rates.

Denis Thiery concluded: “We are confident in the strength of our mail-related
business whilst businesses not related to mail are taking on a whole new
dimension at Neopost. This dynamic gathered pace in 2012 with the successful
integration of GMC Software and Human Inference. These are fast-growing
businesses and we are rapidly developing commercial synergy with the
traditional businesses of the Neopost network. Neopost’s mailroom systems are
now integrated in a broader offering, ranging from the management of customer
communication tools to logistics solutions, via data quality. This meets a
real need identified amongst our clients. We are therefore extremely confident
in the success of this strategy and in the prospects for growth at Neopost.”

Calendar

Full-year 2012 results will be published on 26 March 2013 after market close.

First-quarter sales figures will be published on 3 June 2013 after the market
close.

ABOUT NEOPOST

NEOPOST IS THE EUROPEAN LEADER and the number two world-wide supplier of
mailing solutions. It has a direct presence in 29 countries, with 5,900
employees and annual sales of €1.070 billion in 2012. Its products and
services are sold in more than 90 countries. The Group is a key player in the
markets for mailroom equipment and logistics solutions.

Neopost supplies the most technologically advanced solutions for franking,
folding/inserting and addressing as well as logistics management and
traceability. Neopost also offers a full range of services, including
consultancy, maintenance and financing solutions.

Neopost is listed in the A compartment of Euronext Paris and belongs notably
to the SBF 120 index.

Contact:

For further information:
Neopost
Gaële Le Men, 01 45 36 31 39
Investor Relations Officer
g.le-men@neopost.com
or
DDB Financial
Fabrice Baron, 01 53 32 61 27
fabrice.baron@ddbfinancial.fr
www.neopost.com
 
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