Income from Operations and Net Income Income from operations reached €19.8 million. Compared with income from operations before non-recurring items of 2013, it increased €2.4 million (+14%) like-for-like, and rose €2.3 million (+13%) at actual exchange rates. Financial income and expenses represented a net charge close to zero. Foreign exchange gains and losses generated a net loss of €0.4 million. After an income tax expense of €5 million, net income reached €14.4 million (€12.5 million for 2013 excluding non-recurring items). Net earnings per share were €0.48 on basic capital and €0.47 on diluted capital (€0.43 and €0.42 in 2013 excluding non-recurring items). Free Cash Flow Free cash ﬂow amounted to €19 million (€17.6 million for 2013 after including a non-recurring receipt of €11.1 million). There were no non-recurring items in 2014. Excluding non-recurring items, free cash ﬂow increased by €12.5 million. The amount of €19 million results from cash ﬂow provided by operating activities of €25.8 million (including a €7.9 million decrease in the working capital requirement), and cash ﬂow used for capital expenditures of €6.7 million. The 2010 research tax credit (€5.7 million) has been received. The research tax credit (€6.8 million) and the competitiveness and employment tax credit (€0.8 million) for 2014, and the reversal of provisions of €0.7 million were accounted for but not received. If the tax credits received had been equal to the amount recognized, free cash ﬂow would have been €21.7 million, exceeding net income by €7.3 million. Shareholders’ Equity At December 31, 2014, consolidated shareholders’ equity reached €94.1 million (€83.8 million at December 31, 2013) after payment on May 7 of the €6.6 million dividend (€0.22 per share) declared in respect of ﬁscal 2013. The ﬁgure for shareholders’ equity is calculated after deduction of treasury shares held under the Liquidity Agreement and valued at their acquisition cost of €0.1 million (€0.1 million at December 31, 2013).
Cash and cash equivalents totaled €43.5 million (€29.5 million at December 31, 2013) and ﬁnancial borrowings have been reduced to €0.4 million (€0.9 million at December 31, 2013). Consequently, the net cash position was €43.1 million (€28.6 million at December 31, 2013). The working capital requirement amounted to €0.1 million. It has included the receivable of €23 million on the French tax administration (Trésor public) corresponding to the research tax credit recognized since ﬁscal year 2011, and the competitiveness and employment tax credit since 2013, neither of which has yet been received or offset against income tax. Restated for this receivable, the working capital requirement was negative at €22.9 million, a key feature of the Group’s business model. It should be noted that, when these tax credits cannot be deducted from corporate income tax, they are treated as a receivable on the French tax administration. If unused in the ensuing three years, they are repaid to the company in the course of the fourth year. Thus, the 2010 research tax credit was repaid to the company in October 2014.
4. RISK FACTORS MANAGEMENT OF RISKS