Atos reports first quarter 2024 performance
Press Release
Atos reports first quarter 2024
performance1
Q1 2024 Revenue €2,479m, down -2.6%
organically
- Eviden down -3.9% organically, reflecting continued softness in
Americas and the UK
- Tech Foundations down -1.5% organically, reflecting lower scope
of work with certain customers in Americas and Central Europe
Order entry of €1.6bn for a book-to-bill of 64%,
compared with 73% in prior year
- Eviden book-to-bill at 83%, compared with 79% in prior year,
driven by stronger demand in High-Performance Computing
- Tech Foundations book-to-bill at 47%, compared with 68% in
prior year as customers delay contract decisions
Operating Margin of €48 million or 1.9% of
revenue
- Eviden at 1.9% and Tech Foundations at 2.0%
Cash position2 of €1.0
bn as of March 31, 2024
- Net debt position of €3.9 bn, reflecting a €1.3 bn reduction of
working capital actions compared with December 2023
- Implementation of interim financing of €450m in progress
Business plan presented on April 9 to be adjusted to
reflect current business performance and trends
- Revisions to the 2024-2027 business plan to lead to an increase
in new money needs and to a potential additional debt
reduction
- Update to be communicated to the market in the coming days
Refinancing proposal deadline extended to May
3
- Allowing all stakeholders time to incorporate new
information
- July 2024 target date to reach a refinancing agreement with
financial creditors unchanged
Paris, France – April 25 2024 -
Atos, a global leader in digital transformation, high-performance
computing and information technology infrastructure, today
announces its performance for the first quarter of 2024.
Atos’ Chief Executive Officer, Paul
Saleh declared: “Tech Foundations and Digital are
executing on their transformation plans. Business was nonetheless
impacted by softer market conditions in key regions such as the
Americas and Central Europe as well as delays in contract
award.
During this quarter, our BDS business expanded
its leadership in high-performance computing, with a new contract
award in Denmark to accelerate research and innovation in various
fields such as healthcare, life sciences, and the green transition,
as well as with add-on work for existing HPC customers.
On April 9, we outlined the key parameters of a
refinancing framework to address our overall debt levels and
upcoming debt maturities. We will update in the coming days those
parameters to take into account the adjustment of our 2024-2027
business plan. We have therefore extended the deadline for
submissions of refinancing proposals by existing stakeholders and
third-party investors to May 3. We will review those proposals with
our financial creditors and agree on an appropriate path forward.
Our goal remains to agree on a refinancing solution by this coming
July.
I would like to take this opportunity to
recognize our 94,000 employees for their commitment to giving our
customers the highest quality of service delivery. I would like to
also thank our customers and partners for their continued
support.”
Revenue by Businesses
In € million |
Q1 2024Revenue |
Q1 2023 Revenue |
Q1 2023Revenue* |
Organic variation* |
Eviden |
1 164 |
1 317 |
1 212 |
-3.9% |
Tech Foundations |
1 314 |
1 473 |
1 334 |
-1.5% |
Total |
2 479 |
2 790 |
2 546 |
-2.6% |
*: at constant scope and average exchange
rates
Group revenue was €2,479
million in Q1 2024, down -2.6% organically compared with Q1
2023.
Eviden revenue was €1,164
million, down -3.9% organically.
-
Digital activities decreased mid-single digit.
While revenue grew in continental Europe with public sector and
utility customers, the business was impacted by the general market
slowdown in Americas and by contract scope reductions in the United
Kingdom.
- Big
Data & Security (BDS) revenue decreased low single
digit organically. Revenue in Advanced Computing was up slightly,
with stronger activity in the public sector in France and in Asia.
Revenue in Digital Security declined, impacted by a ramp up delay
in a large project in Europe.
Tech Foundations was €1,314
million, down -1.5% organically.
- Core
revenue (excluding BPO and value-added resale (“VAR”))
decreased by -3.6%. Stronger contributions related to the Paris
Olympic & Paralympic games and the UEFA contract were offset by
slowdown in public sector spending in Central Europe as well as by
contract scope and volume reductions in Americas.
-
Non-core revenue grew high-single digit,
reflecting a strong demand for hardware and software products from
European customers and a moderate growth in BPO activities in the
United Kingdom.
Overall, revenue of the Group was impacted by delays in award of
new contracts and add-on work, as clients await the final
resolution of the Group’s refinancing plan.
Revenue by Regional Business
Unit
In € million |
Q1 2024Revenue |
Q1 2023 Revenue |
Q1 2023Revenue* |
Organic variation* |
Americas |
547 |
642 |
591 |
-7.5% |
Northern Europe & APAC |
754 |
788 |
778 |
-3.2% |
Central Europe |
533 |
633 |
554 |
-3.8% |
Southern Europe |
565 |
661 |
561 |
+0.7% |
Others & Global Structures |
81 |
66 |
62 |
+29.9% |
Total |
2 479 |
2 790 |
2 546 |
-2.6% |
*: At constant scope and average exchange
rates
Americas revenue decreased by
-7.5% on an organic basis, reflecting the current
general slowdown in market conditions. Digital services were down
reflecting contract completions and volume decline in Healthcare
and Insurance. The delivery of a supercomputer project in South
America in Q1 2023 also provided a higher prior year comparison
basis for BDS. Revenue in Tech Foundations was down due to a
contract completion and scope reductions with select customers.
Northern Europe &
Asia-Pacific revenue decreased by -3.2%
on an organic basis. Eviden revenue declined high-single digit,
reflecting a lower demand from Public Sector, Healthcare and
Insurance customers. Revenue in Tech Foundations was slightly up
with the contribution from Asia and increased BPO activity in the
UK offsetting volume decline in the healthcare sector.
Central Europe revenue was down
-3.8% on an organic basis. Eviden revenue slightly
declined, as growth in Digital activities in Germany and Austria
offset lower activities in BDS. Tech Foundations revenue declined
high-single digit, reflecting delays in public sector spending.
Southern Europe revenue was up
+0.7% organically. Eviden revenue grew mid-single
digit, reflecting strong activity in High-Performance Computing.
Digital activities grew as well, benefitting from the ramp-up of
large contracts in Spain and with a major European utility company
in France. Tech Foundations revenue declined low single-digit
following contract completions with Banking and Public Sector
customers.
Revenue in Others and global
structures, which encompass Middle East, Africa, Major
Events as well as the Group’s global delivery centers and global
structures, strongly grew by 30% organically, reflecting strong
performance in Major Events with the ramp up of activities related
to the Paris Olympic & Paralympic games and the UEFA
contract.
Commercial activity
Order entry for the Group was
€1,586 million. Eviden order entry was €966
million and Tech Foundations order entry was €620 million.
Book-to-bill ratio for the
Group was 64% in Q1 2024, down from 73% in Q1
2023, reflecting delays in contract awards as clients await the
final resolution of the Group’s refinancing plan.
Book-to-bill ratio at Eviden
was 83%, improving by +4 points compared with the
first quarter of 2023. The increase reflects large orders received
by BDS, in particular an AI system that will perform medical and
scientific research in Denmark and contracts to extend the
computing capacity of existing HPCs: the Santos Dumont in Brazil
and the Jean Zay in France. Main order intake also included an SAP
implementation and maintenance contract for the European Union and
an application maintenance contract with a public sector customer
in Central Europe.
At Tech Foundations, Q1
book-to-bill was 47%, down from 68% in Q1 2023.
Despite the signature of several large contact renewals, notably in
Hybrid Cloud & Infrastructure with a Transportation customer
and in Digital Workplace with a client in the financial sector in
Americas, signature of new outsourcing contracts was delayed due to
the current low demand for new services from public sector
customers in Central Europe and the impact of customers delaying
decisions on major IT projects, as they await the final resolution
on our refinancing plan.
At the end of March 2024, the full
backlog was €17.3 billion representing 1.7 years of
revenue. The full qualified pipeline amounted to
€6.0 billion at the end of March 2024.
Operating margin
Group operating margin in the
first quarter of 2024 was €48 million representing 1.9% of revenue,
compared with 3.3% in prior year.
Eviden operating margin was €22
million or 1.9%, down -330 basis points organically. Eviden’s
profitability decreased, impacted by revenue decrease, lower
utilization of billable resources and investment in Advanced
Computing.
Tech Foundations operating
margin was €26 million or 2.0%, up +50 basis points
organically, reflecting the continued execution of its
transformation program.
Based on current market conditions and business
performance for the first quarter of the year, Atos will adjust its
2024-2027 business plan and communicate any revisions in the coming
days.
Q1 2024 cash and net financial
debt
As of March 31, 2024, cash & cash
equivalents and short-term financial assets was €1.0 billion, down
€1.4 billion compared with December 31, 2023 primarily reflecting
€1.3 billion lower working capital actions compared with the end of
fiscal 2023.
As of March 31, 2024, net debt was €3.9 billion
compared with €2.3 billion at the end of last year, reflecting
primarily the reduction of the working capital actions.
Interim financing
The implementation of the interim financing of
€450 million with groups of banks and bondholders and the French
state communicated on April 9, 2024 is progressing.
Refinancing discussions with financial creditors
progressing with a target resolution by July 2024
Atos SE has entered into an amicable
conciliation procedure in order to frame discussions with its
financial creditors. This is to facilitate the emergence of a
global agreement regarding the restructuring of its financial debt
within a short and limited timeframe of four months, which could be
further extended by one month if needed.
In this context, Atos SE presented the key
parameters of its refinancing framework to its financial creditors
on April 8, 2024.
Based on current market conditions and business
performance for the first quarter of the year, Atos will adjust its
2024-2027 business plan, which should lead to an increase of its
parameters for cash needed to fund the business and for a potential
additional debt reduction.
Proposal submission date by existing
stakeholders of Atos SE and third-party investors is pushed out to
May 3, 2024 to give all stakeholders time to incorporate new
information, which will be communicated in the coming days.
Atos will evaluate all proposals, under the
aegis of the conciliator Maître Hélène Bourbouloux in the best
corporate interest of the Company including its employees, clients,
suppliers, shareholders, and other stakeholders, while maintaining
an attractive business mix. Atos will also take into consideration
the sovereign imperatives of the French state.
Atos aims for a global agreement on the new
capital structure of the Company to be finalized by July 2024.
Atos will inform the market in due course of the
progress of the refinancing discussions, which will result in a
change in its capital structure arising from a final global
refinancing agreement, including the potential issuance of new
equity which will result in a dilution of the existing
shareholders.
Shareholders and financial creditors will be
consulted in compliance with French legal requirements.
As a reminder, the financial parameters of the
refinancing framework provided by the Group are based on the
Group’s current perimeter, which includes the assets of Eviden and
Tech Foundations without taking into account the impact of any
potential asset disposals.
These parameters act as guidelines for all
interested parties who will ultimately present their proposals to
the company and the conciliator.
Human resources
The total headcount was
93,642 at the end of March 2024, decreasing by
-1.6% compared with 95,140 at the end of December 2023.During the
first quarter, the Group hired 3,079 staff (of which 94.7% were
Direct employees), while attrition rate in the first quarter of
2024 was the lowest Q1 over 3 years at 13.0% vs 15.3% in 2023.
Conference call
Atos’ Management invites you to an international
conference call on the Group revenue for the first quarter of 2024,
on Thursday, April 25, 2024 at 08:00 am (CET –
Paris).
You can join the webcast of the
conference:
- via the
following link:
https://edge.media-server.com/mmc/p/ady4y3pm
- by telephone
with the dial-in, 10 minutes prior the starting time. Please note
that if you want to join the webcast by telephone, you must
register in advance of the conference using the following
link:
https://register.vevent.com/register/BI633fab59d4cc4520b165781369018611
Upon registration, you will be provided with
Participant Dial In Numbers, a Direct Event Passcode and a unique
Registrant ID.
During the 10 minutes prior to the beginning of
the call, you will need to use the conference access information
provided in the email received upon registration.
After the conference, a replay of the webcast
will be available on atos.net, in the Investors section.
APPENDIX
Q1 2023 Revenue and operating margin at
constant scope and exchange rates reconciliation
For the analysis of the Group’s performance,
revenue and operating margin for Q1 2024 is compared with Q1 2023
revenue and operating margin at constant scope and foreign exchange
rates. Reconciliation between the Q1 2023 reported revenue and
operating margin and the Q1 2023 revenue and operating margin at
constant scope and foreign exchange rates is presented below.
In 2023, the Group reviewed the accounting
treatment of certain third-party standard software resale
transactions following the decision published by ESMA in October
2023 that illustrated the IFRS IC decision and enacted a
restrictive position on the assessment of Principal vs. Agent under
IFRS 15 for such transactions. The Q1 2023 revenue is therefore
restated by €-16 million. The restatement impacted Eviden in the
Americas RBU without impacting the operating margin.
Q1 2023 revenueIn € million |
Q1 2023 published |
Restatement |
Q1 2023 restated |
Internal transfers |
Scope effects |
Exchange rates effects |
Q1 2023* |
Eviden |
1 334 |
-16 |
1 317 |
0 |
-102 |
-3 |
1 212 |
Tech
Foundations |
1 473 |
0 |
1 473 |
0 |
-138 |
-1 |
1 334 |
Total |
2 806 |
-16 |
2 790 |
0 |
-239 |
-4 |
2 546 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2023 revenueIn € million |
Q1 2023 published |
Restatement |
Q1 2023 restated |
Internal transfers |
Scope effects |
Exchange rates effects |
Q1 2023* |
Americas |
659 |
-16 |
642 |
0 |
-39 |
-13 |
591 |
Norther Europe
& APAC |
788 |
0 |
788 |
0 |
-20 |
10 |
778 |
Central
Europe |
633 |
0 |
633 |
0 |
-81 |
2 |
554 |
Southern
Europe |
661 |
0 |
661 |
0 |
-100 |
0 |
561 |
Others &
Global structures |
66 |
0 |
66 |
0 |
0 |
-4 |
62 |
Total |
2 806 |
-16 |
2 790 |
0 |
-239 |
-4 |
2 546 |
*: At constant scope and foreign exchange rates
In Q1 2024, scope effects on revenue amounted to
€-239 million. They mainly related to the divesture of Italy in
Southern Europe, of UCC across all regions, of EcoAct in Southern
Europe, Americas and Northern Europe & Asia-Pacific and of the
share in the JV with State Street in Americas.
Currency effects negatively contributed to
revenue for €-4 million. They mostly came from the depreciation of
the American dollar, the Argentinian peso and the Turkish lira, not
compensated by the appreciation of the British pound.
Q1 2023 operating marginIn €
million |
Q1 2023 published |
Restatement |
Q1 2023 restated |
Internal transfers |
Scope effects |
Exchange rates effects |
Q1 2023* |
Eviden |
81 |
0 |
81 |
0 |
-17 |
0 |
63 |
Tech
Foundations |
29 |
0 |
29 |
0 |
-9 |
0 |
20 |
Total |
110 |
0 |
110 |
0 |
-26 |
-1 |
84 |
*: At constant scope and foreign exchange rates
***
Disclaimer
This document contains forward-looking
statements that involve risks and uncertainties, including
references, concerning the Group’s expected growth and
profitability in the future which may significantly impact the
expected performance indicated in the forward-looking statements.
These risks and uncertainties are linked to factors out of the
control of the Company and not precisely estimated, such as market
conditions or competitor’s behaviors. Any forward-looking
statements made in this document are statements about Atos’s
beliefs and expectations and should be evaluated as such.
Forward-looking statements include statements that may relate to
Atos’s plans, objectives, strategies, goals, future events, future
revenues or synergies, or performance, and other information that
is not historical information. Actual events or results may differ
from those described in this document due to a number of risks and
uncertainties that are described within the 2022 Universal
Registration Document filed with the Autorité des Marchés
Financiers (AMF) on April 21st, 2023 under the registration number
D.23-0321 and within the 2023 Consolidated financial statements
published by Atos SE on March 26, 2024. Atos does not undertake,
and specifically disclaims, any obligation or responsibility to
update or amend any of the information above except as otherwise
required by law. This document does not contain or constitute an
offer of Atos’s shares for sale or an invitation or inducement to
invest in Atos’s shares in France, the United States of America or
any other jurisdiction.
This document includes information on specific
transactions that shall be considered as projects only. In
particular, any decision relating to the information or projects
mentioned in this document and their terms and conditions will only
be made after the ongoing in-depth analysis considering tax, legal,
operational, finance, HR and all other relevant aspects have been
completed and will be subject to general market conditions and
other customary conditions, including governance bodies and
shareholders’ approval as well as appropriate processes with the
relevant employee representative bodies in accordance with
applicable laws.
About Atos
Atos is a global leader in digital
transformation with c. 94,000 employees and annual revenue of c. €
11 billion. European number one in cybersecurity, cloud and
high-performance computing, the Group provides tailored end-to-end
solutions for all industries in 69 countries. A pioneer in
decarbonization services and products, Atos is committed to a
secure and decarbonized digital for its customers. Atos is a SE
(Societas Europaea), and listed on Euronext Paris.
The purpose of Atos is to help design the future
of the information space. Its expertise and services support the
development of knowledge, education and research in a multicultural
approach and contribute to the development of scientific and
technological excellence. Across the world, the Group enables its
customers and employees, and members of societies at large to live,
work and develop sustainably, in a safe and secure information
space.
Contacts
Investor relations : David Pierre-Kahn | investors@atos.net |
+33 6 28 51 45 96
Individual shareholders : 0805 65 00 75
Press contact : globalprteam@atos.net
1 Unaudited2 Cash & cash equivalents and short-term
financial assets
- PR-Atos reports first quarter 2024 performance
Atos (TG:AXI)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Atos (TG:AXI)
Gráfica de Acción Histórica
De May 2023 a May 2024