RWS Turbocharges Integration of SDL, Heads for Billion Dollars in 2021 Revenues – via slator.com


RWS Turbocharges Integration of SDL, Heads for Billion Dollars in 2021 Revenues

Shares in RWS opened flat after the UK-headquartered language services and technology provider (LSP) issued an interim trading update. After acquiring UK-rival SDL in a 2020 deal that stunned the industry, RWS is now locked in a race with TransPerfect for the title of world’s largest LSP, with both companies poised to break the billion-dollar revenue mark this year.

For the six-month period ended March 31, 2021 (H1 2021), RWS reported revenues of GBP 326.4m (USD 454m). This includes full H1 2021 revenues from machine translation (MT) provider Iconic and India-based LSP Webdunia, which were acquired in 2020, as well as five months’ worth of trading at SDL (GBP 151.5m).

Half-year, pre-tax profit is expected to rise to “at least” GBP 50m from GBP 33.1m in the prior year. Driving profits is what RWS called “its original business,” in which pre-tax profit was “significantly ahead of the prior year.”

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RWS is aggressively pushing ahead with its integration strategy to boost the margins and profitability of the SDL business. RWS said they see savings “principally from the removal of overlapping roles.”

The company now projects total (annual) integration savings of GBP 32m, more than double the figure of GBP 15m originally identified at the time of the acquisition. RWS also noted that they are doubling down on efforts to finalize the integration SDL’s 2018 acquisition of Donnelley Language Solutions.

In terms of branding, however, the SDL integration seems to have been completed. The SDL name is gone, SDL Trados Studio is now just Trados Studios, and all SDL-associated websites now redirect to RWS.

To further drive efficiencies, RWS is moving some of its biggest clients on to SDL’s internal Helix delivery platform. But the company’s major enterprise technology accounts will stay put and the company said, “Moravia’s large technology customers will continue to be serviced by Moravia’s highly bespoke and successful operating model.”

RWS has also reorganized its company structure and now operates in four distinction divisions.

  • RWS IP Services
  • RWS Regulated Industries
  • RWS Language Services
  • RWS Language Content and Technology

The new RWS Regulated Industries division now houses the former RWS Life Sciences division and the former SDL Regulated Industries business. The RWS Language Services division comprises both the former RWS Moravia and the former SDL Commercial and Enterprise businesses.

The new RWS Language Content and Technology is the fourth division in RWS’ new organizational structure and houses Trados, MT, SDL’s content management technologies, and other technology businesses.

In terms of the half year, IP Services “recorded an improved trading performance in the first half of 2021 compared with the second half of 2020” but is still struggling with Covid-19 lockdowns in Europe, RWS said.

Regulated Industries saw revenues rise 5.4% (+10.7% in constant currency) powered by the Linguistic Validation business and strong sales to RWS’ largest pharma client. In Language Services, the picture was mixed with Moravia sales up 6% (in constant currency) on the back of strong orders from key technology clients.

Meanwhile, the SDL part of the businesses was down 3% as “some segments [such as] manufacturing, remain impacted by Covid-19.”

On the marketing front, RWS has chosen to continue SDL’s Connect conference series. The online event (recordings available online) was attended by hundreds of enterprise clients as well as LSPs and freelance translators in mid-April 2021. The agenda included keynotes by RWS CEO Richard Thompson and former SDL exec and now RWS Chief Technology Officer, Azad Ootam.

Ootam discussed how RWS is realigning the company’s technology offering into RWS Language Cloud (TM, WorldServer, Multitrans, Trados, GroupShare, Passolo), Linguistic AI (LanguageWeaver), and Content Technologies (Tridion, Contenta, XPP).

Image: Richard Thompson, CEO, RWS



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