Sopra Steria - 2018 Registration document

DETAILED PRESENTATION OF SOPRA STERIA Overview of the digital services sector

2. Overview of the digital services sector 2.1. Main markets – Competitive environment of the digital services sector In 2018, the digital services market in Western Europe was worth an estimated €305 billion (1) .

❙ DIGITAL SERVICES MARKET IN WESTERN EUROPE (EXCLUDING HARDWARE AND SOFTWARE)

Country (in billions of euros)

2018 estimates

France

40.3 90.8 52.7

United Kingdom

Germany

Rest of Europe

121.2 305.0

TOTAL

Source: Gartner (Q4 2018), in constant 2013 US dollars.

The market in Western Europe expanded by an estimated 4% in 2018, including growth of 4.6% in Germany, 4% in France and 2.4% in the United Kingdom. According to market research (source: Gartner), this trend is expected to continue, with annual growth of more than 4% out to 2022.

❙ DIGITAL SERVICES MARKET IN WESTERN EUROPE (EXCLUDING HARDWARE AND SOFTWARE)

Business (in billions of euros)

2018 estimates

Consulting

61.2 75.7

Systems development and integration

Outsourced IT services

129.7

Business process outsourcing

38.4

TOTAL

305.0

Source: Gartner (Q4 2018), in constant 2013 US dollars.

In 2018, the business process outsourcing and outsourced IT services segments expanded at estimated rates of 2.9% and 2.8%, respectively. The fastest-growing segments were services relating to applications development and systems integration (estimated 4%

holding far less than a 10% share. Against this backdrop, Sopra Steria is one of the ten largest digital services companies operating in Europe (excluding captive service providers and purely local players). Its market share stands at over 4% in France and currently averages between 0.5% and 1% in the other major European markets. Sopra Steria’s main competitors in Europe are Accenture, Atos, Capgemini, CGI, DXC and IBM, all of which are present worldwide. It also faces competition from Indian groups, chiefly in the United Kingdom (such as TCS, Cognizant, Wipro and Infosys), and local companies with a strong regional presence (Indra in Spain, Fujitsu in the United Kingdom, Tieto and Evry in Scandinavia, etc.). Apart from its services business, listed rivals such as Temenos and Alfa Financials also command a significant presence in the software market, where Sopra Steria is also present, especially in banking.

growth) and consulting (estimated 7.7% growth). The European market has two main characteristics:

p three countries (the United Kingdom, Germany and France) account for 60% of IT services spending (1) ; p outsourcing of technology services (application maintenance and infrastructure management) and business process outsourcing together account for a little over half of IT services spending by European companies (1) . Furthermore, the IT services market remains fragmented despite some consolidation, with the leading player in the European market

(1) Source: Gartner (Q4 2018), in constant 2013 US dollars.

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SOPRA STERIA REGISTRATION DOCUMENT 2018