(BFM Bourse) – The specialist in electronic labels indicated this Tuesday morning that it had signed an amendment to the contract with Walmart for orders close to a billion euros. Walmart will be able to exercise its option to acquire a stake in VusionGroup.
Walmart renews its trust in VusionGroup to accelerate the digital transformation of its American stores. The French electronic label specialist indicated Tuesday morning that it had signed a contractual amendment to accelerate the deployment of EdgeSense and VusionCloud solutions in Walmart’s American stores.
The EdgeSense solution was co-developed by the former SES-imagotag and Walmart. This new technology for price labels consumes little energy and clips onto the rails of existing shelves in stores. These rails facilitate “communication, precise geolocation and information exchange between Bluetooth-LE compatible devices,” explains VusionGroup.
VusionGroup has already equipped 53 Walmart stores in the United States with this technology. The new framework contract accelerates the deployment of the French group’s EdgeSense and VusionCloud solutions. It also plans “a functional extension of the software solution which will improve merchandising, inventory management and e-commerce order preparation processes”.
For VusionGroup, this acceleration of deployment translates into order intake worth close to 1 billion euros. This amount corresponding to this signature will be included in the figures for the next quarters, which allows the former SES-imagotag to be “confident” in its growth plan for 2025.
On the Paris Stock Exchange, VusionGroup signs the largest increase in the SBF 120, after signing this amendment to the contract with Walmart. The stock jumped 14.90%, to 153.50 euros, returning to 2-month highs.
Red carpet for Walmart
The first orders will therefore be integrated into VusionGroup’s activity. For its part, Walmart will be able to begin to participate in the capital, by exercising its share subscription warrants in accordance with the terms of the operation voted on June 2, 2023, by the annual general meeting of VusionGroup.
Remember that the historic contract signed with Walmart in April 2023 includes a capital increase reserved for the American group, in the form of share subscription warrants which would represent a maximum of 10% of VusionGroup’s capital in the long term.
This contract provided that the first option would only be triggered from $700 million in expenditure made by Walmart with SES-imagotag and the 10% would only be reached if the total expenditure reached $3 billion.
This historic contract with the giant Walmart also supports the growth prospects of the group, which aims to exceed one billion euros in turnover in 2024, notably driven by the acceleration of its activity in the United States.
In its note published last March, Stifel indicated that this objective corresponded to growth of +24%, and specified “that turnover in the United States should be multiplied by three”.
“This growth will be more concentrated in the second half due to the planned start-up during the second quarter of new production lines for the EdgeSense range for Walmart,” indicated the former SES-imagotag. The group anticipates adjusted revenue of around 420-440 million euros in the first half (i.e. growth of 10-15%), before expecting a record second half of 580-600 million euros. euros, which reflects growth of between 30 and 40%, adds the company.
VusionGroup is on track to achieve this goal. In the first quarter, the specialist in smart labels for physical stores saw its turnover increase by 12% year-on-year to stand at 178 million euros in adjusted data.
Global order intake increased by +24% to 274 million euros, i.e. VusionGroup’s “second best quarter in history”, and the record for a first quarter. “This intense level of new signings concerns both Europe and the United States,” continues VusionGroup.
The group continues to observe “excellent dynamics” both in Europe and in the Americas and Asia-Pacific region. In the last zone mentioned, the group saw its activity soar by 146% to 71.5 million euros, mainly driven by the United States, which will become the group’s leading market in 2024. VusionGroup expects that “growth in the country is expected to continue at a sustained pace in the coming quarters.”
Sabrina Sadgui – ©2024 BFM Bourse
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