First quarter of 2020 – Atos

A resilient profile and a sturdy equilibrium sheet to face an unprecedented situation

Income at € two,834 million

-.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} natural and organic expansion

Book to monthly bill ratio at 103{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}

Renewals of main contracts in North The usa

Appropriate company blend to help customers in Covid-19 context

Essential cost actions currently being carried out to guard operating margin

SPRING transformation software to an Market solution well on track

Update of 2020 objectives publish Covid-19

 

Paris, April 22, 2020,

Atos, a world wide leader in electronic transformation, today announces the revenue of its initially quarter of 2020.

Elie Girard, CEO, said: “In this unprecedented natural environment wherever uncertainty prevails, our initially priority has been to guard our staff though supplying complete continuity of assistance to our clientele. The Group is solidly positioned to navigate smoothly by the crisis many thanks to deep client interactions across all industries, a resilient company blend and a strong equilibrium sheet that delivers a sturdy money flexibility.

Our 110,000 colleagues across the environment have furnished an speedy and superb response to customers’ issues and have to have for help by our “Always Ready” software designed now considering that the beginning of the yr. Now our minds and initiatives are turning to the publish-Covid periods, actively making ready for the “new normal” which will see an acceleration in particular customers’ wants, particularly facts platforms, cybersecurity, cloud migration, electronic office and decarbonization.

We revise today our objectives for 2020 demonstrating the resilience of the Group and the willingness to share any effects pretty across stakeholders. I am convinced that Atos will arise from this world wide crisis much better than at any time and prepared to shift forward to the up coming stage.”

Q1 2020 revenue was € 2,834 million, down -.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically. In the context of Covid-19 crisis and constraints and lockdowns in March in most of the nations around the world wherever the Group operates, revenue lowered only a little bit many thanks to the resilient profile of its firms based on multi-yr contracts put together with its sound company in Significant Information and Cybersecurity. Furthermore, and in spite of the crisis, the Group accelerated its commercial dynamism with get entry at € 2,908 million major to a e-book to monthly bill ratio of 103{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}, noticeably up in comparison to past yr at 86{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}.

Q1 2020 revenue performance by Market

In € million	Q1 2020	Q1 2019*	Natural and organic evolution
Production	539	555	-two.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Economical Solutions & Insurance coverage	527	542	-two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Public Sector & Protection	584	566	+3.two{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Telecom, Media & Technologies	443	439	+.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Assets & Solutions	418	416	+.four{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Healthcare & Lifetime Sciences	323	340	-four.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Whole Group	two,834	two,858	-.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
* At frequent scope and exchange premiums

 

Production arrived at € 539 million of revenue, down -two.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} at frequent scope and exchange premiums. The Market benefitted from a good performance in Automotive with the ramp-up of a German automobile company and Rheinmetall on facts administration contracts, compensating the effects in Daimler because of to Covid-19 and the ramp down of PSA. Conversely, Production was impacted by reduced volumes with Siemens, a slowdown in the Aerospace sector because of to Covid-19, and numerous shifts of equipment sales to the finish of the quarter.

Economical Solutions & Insurance coverage revenue was € 527 million in the initially quarter 2020, down by -two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically. Northern Europe and Southern Europe benefited respectively from the ramp-up with Aegon in the United Kingdom, as well as the progress of action with a payment company in France which have much more than compensated for the reduction of volumes from banking establishments in Central Europe. Escalating markets suffered from non-recurring sales executed past yr in APAC and Middle East & Africa. In North The usa, task based pursuits lessen now observed in earlier quarters was accelerated in March because of to choices from numerous Economical Solutions corporations to postpone or cut down discretionary charges in the context of Covid-19.

Public Sector & Protection revenue was € 584 million, up +3.two{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} at frequent scope and exchange premiums. The expansion was pushed by the sturdy performance recorded in Northern Europe, many thanks to the continuation of the agreement with European Heart for Medium variety Climate forecast as well as with EU Lisa and clever facts platform in Benelux. North The usa reached stability regardless of reduced volumes, many thanks to extra sales on present contracts. The situation was much more complicated in Southern Europe, impacted by the ramp-down of Large General performance Computing action as well as non-recurring sales executed past yr. Central Europe was negatively impacted by reduced volumes, and ultimately Escalating Markets was impacted by revenue recorded past yr for the Tokyo Olympic Games preparation and not recurring this yr.

Telecom, Media & Technologies arrived at € 443 million, up +.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically, with a contrasted performance by geography and by action. Large Tech & Technologies posted a sturdy expansion, pushed by Unified Interaction & Collaboration choices in Central Europe, sustained by natural and organic expansion of recently obtained company Maven Wave in North The usa and agreement ramp-up with a big companion, as well as extra sales in Southern Europe. Media enhanced as well, benefitting from new company progress, coupled with bigger volumes with present customers in North The usa. Telecom action was mainly impacted by some ramp-downs in Southern Europe.

Income in Assets & Solutions arrived at € 418 million and enhanced by +.four{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically. Enterprise in Power & Utilities sector fueled the expansion. In particular, the Market delivered a Large General performance Computer system in South The usa. Digital office expert services ramped-up with a main Power provider in North The usa and with National Grid in Northern Europe. The situation in Retail, Transportation & Hospitality sectors was much more complicated in the context of Covid-19. Certainly, though the ramp-up of a new IoT agreement signed in the place of predictive maintenance benefitted to North The usa, the Market confronted volume reductions in Europe.

Healthcare & Lifetime Sciences revenue was € 323 million, down by -four.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} in comparison to Q1 2019, impacted by volume reductions on very particular contracts in equally North The usa and Northern Europe, though the market benefitted from the ramp-up of a world wide agreement with Bayer and a electronic office agreement signed past yr in Central Europe, and the ramp-up of an Australian Public Agency agreement in Escalating Markets. Southern Europe benefitted from a sturdy action in electronic initiatives and Large General performance Computing.

 

Q1 2020 revenue performance by Regional Enterprise Unit

 

In € million	Q1 2020	Q1 2019*	Natural and organic evolution
North The usa	681	699	-two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Northern Europe	698	696	+.3{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Southern Europe	594	609	-two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Central Europe	667	660	+one.{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Escalating Markets	194	192	+one.{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Whole Group	two,834	two,858	-.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
* At frequent scope and exchange premiums

The initially quarter of 2020 showed distinctive revenue evolution by Regional Enterprise Units which can be summarized as follows:

• In North The usa, revenue arrived at € 681 million, decreasing by -two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically mainly coming from Covid-19 caused task stops and volume reductions in numerous Industries. The Enterprise Unit reached expansion in Telecom, Media & Technologies and Assets & Solutions many thanks to new brand, bigger volumes and ramp up of present contracts
• In Northern Europe, revenue was approximately steady at € 698 million. Robust company was recorded in Public Sector & Protection mainly led by the continuation of the HPC agreement with European Centre for Medium Variety Climate Forecast, as well as by deliveries to European Union Establishments. Telecom, Media & Technologies and Manufacturing confronted some contracts ending and Healthcare & Lifetime Sciences a reduction on Enterprise Method Outsourcing contracts
• In Southern Europe, revenue arrived at € 594 million, decreasing by -two.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} Healthcare & Lifetime Sciences posted a double-digit expansion many thanks to electronic initiatives delivered and Large General performance Computing pursuits. The geography was impacted by non-recurring sales also on Large General performance Computing pursuits executed past yr in numerous Industries
• In Central Europe, the geography enhanced organically by +one.{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} major to a € 667 million Production benefitted from numerous ramp-up of infrastructure contracts and extra initiatives. Income in Telecom, Media & Technologies also enhanced, pushed by Unified Interaction & Collaboration company. Healthcare & Lifetime Sciences posted a double-digit expansion mainly fueled by new contracts. Public Sector & Protection was impacted by non-recurring sales and initiatives reached past yr though new initiatives in SAP HANA and in Digital had been executed in Germany and in Austria. At last, Assets & Solutions was impacted by a reduced desire in Unify Interaction channels
• Escalating Markets arrived at € 194 million revenue, +one.{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} Production posted a sound expansion, pushed by a bigger stage of sales as well as much better desire in electronic initiatives mainly in Asia-Pacific and South The usa. Income in Resource & Solutions strongly enhanced fueled by Large General performance Computing action in South The usa though the situation was much more complicated in Economical Solutions mainly in Asia Pacific.

Q1 2020 revenue performance by Division

 

In € million	Q1 2020	Q1 2019*	Natural and organic evolution
Infrastructure & Information Management	one,558	one,566	-.five{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Enterprise & Platform Remedies	one,016	one,069	-four.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Significant Information & Cybersecurity	259	223	+sixteen.3{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Whole Group	two,834	two,858	-.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
* At frequent scope and exchange premiums

In Infrastructure & Information Management (IDM), revenue was € 1,558 million, -.five{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically. The Division continued to roll-out its transformation design by extending Hybrid Cloud Orchestration as well as expanding Digital Office implementation.

The particular situation because of to Covid-19 pandemic needed a sound company continuity for crucial infrastructures for its customers. Certainly, the Division recorded a sturdy desire on Digital Office alternatives (accessing apps from any place), enterprise conversation choices with Unified Collaboration & Interaction, community connections, and so on. These pursuits are linked to the distant doing the job that has been set in position by a ton of corporations to face the lockdown and preserve their action.

At last, in the current context, the Division recorded significantly less revenue generated by equipment sales and fertilization in present contracts in March.

In Enterprise & Platform Remedies (B&PS) revenue was € 1,016 million, -four.9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically. As a reminder, the Division was down -one.two{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} in This autumn 2019 because of to the headwinds in Economical Solutions in North The usa as well as in Automotive market in Germany, and hence did not count on any advancement in the beginning of 2020 even ahead of Covid-19.

In the new context of Covid-19, the Division had to face a slowdown in most of the Industries. Certainly, this company phase is much much more dependent from the cycle and customers begun in March to postpone discretionary initiatives. The Group considers that the most impacted pursuits will be Technologies Qualified Solutions requiring engineers doing the job on consumer web-sites, that are not able to be executed on a distant method (circa 30{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} of Enterprise & Platform Remedies revenue). On the opposite, Software Progress and Servicing, based on extended time period contracts need to be resilient (circa forty{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} of Enterprise & Platform Remedies revenue). In concerning, a big aspect of crucial Digital Assignments (circa 30{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} of Enterprise & Platform Remedies revenue) can be executed on a distant method, but the volume of the company will count in the up coming months from the consumer calls for on new initiatives.

The company in Significant Information & Cybersecurity (BDS) remained sturdy with revenue up +sixteen.3{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} organically at € 259 million in the initially quarter of 2020. In the current context, the distant doing the job as well as the improve of cyberattacks led corporations to fortify the stability of their infrastructure and facts. As illustrations, customers questioned for much more alternatives of identification in swift method, and consulting on the solidity of their stability infrastructure.

In Significant Information, there was no discontinuity in the provide chain many thanks to professional-lively stock administration. The desire continues to be sturdy in Large General performance Computing. As an case in point, distant obtain to SAP HANA necessitates extra processing ability and hence larger sized wants of Sequana S in-memory servers. At last, Mission Crucial Technique company also recorded a high revenue expansion.

Professional action

Throughout the initially quarter of 2020, the Group get entry arrived at € 2,908 million representing a Book to Invoice ratio of 103{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}, in comparison to 86{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} reached over the very same interval past yr.

The most important new contracts signed over the interval had been notably in North The usa with a big American company in Protection Sector (Telecom, Media & Technologies), in Central Europe with Norddeutsche Landesbank (Economical Solutions & Insurance coverage) and a world wide european pharmaceutical company (Well being & Lifetime Sciences) and in Southern Europe with a main utility in France and with Ile-de-France Mobilités (Assets & Solutions), as well as with a French banking establishment (Economical Solutions & Insurance coverage).

Agreement renewals of the quarter involved big signatures with notably the initially aspect of the renewal of Texas Section of Info Assets agreement (Public Sector & Protection), the renewal of Conduent agreement (Telecom, Media & Technologies) in North The usa, a agreement with a International European agency in funds merchandise for SAP HANA (Production) in Central Europe, as well as with the French UGAP (Public Sector & Protection) in Southern Europe.

In line with this dynamic commercial action, the complete backlog amounted to € 22.one billion at the finish of March 2020, representing one.9 yr of revenue. The complete qualified pipeline arrived at € seven.6 billion, representing seven.8 months of revenue.

Human means

The full headcount was 108,602 at the finish of March 2020, broadly steady in comparison to 108,317 at the finish of December 2019.

In the initially quarter of 2020, the Group employed five,043 staff, mainly in offshore nations around the world.

How Atos handles Covid-19 effects

Since finish of January, the Group administration, supported by Group Human Assets, has been focusing on the health and security of staff though guaranteeing a suitable implementation of pre-described company continuity designs in each Division.

The Group also activated the “Always Ready” software, pulling collectively all Group alternatives especially adapted to this distressed situation and currently being proactively supplied to customers to aid them go by the crisis: help to generalized homeworking which includes collaboration characteristics, particular help to community & health establishments, reinforcement of cybersecurity protections, and so on. Customers’ responses and fulfillment with regards to Atos groups reactivity has been overwhelmingly beneficial. Atos is also involved into a lot of governmental initiatives across the environment to combat towards the virus, and put together the progressive relief of constraints and lockdowns.

To guard its operating margin, the Group has taken sturdy actions on its cost foundation in the adhering to parts:

• Robust centralized checking of staff fees (using the services of freeze, cancellation of income increases, effects on variable compensation, holidays, and so on.)
• Substitute of subcontractors by possess freed up staff
• Cancellation of non consumer similar discretionary charges
• Robust saving software on non staff fees.

In full, the Group released a software representing a full total of c. four hundred million euros of cost savings in 2020.

Current 2020 objectives publish Covid-19

As the 2020 objectives disclosed on February 19, 2020 had been pre Covid-19 outcome, the Group updates today its a few objectives for the complete yr 2020, based on the current macroeconomic scenario of a progressive recovery over H2 2020 and 2021, as well as the management’s daily discussions with Group customers:

• Income natural and organic evolution: concerning -two{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} and -four{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} (vs . c. +two{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} pre Covid-19)
• Working margin amount: 9{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} to 9.five{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} of revenue (vs . +20 bps to + forty bps over 2019 (ten.3{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} documented) pre Covid-19)
• Absolutely free hard cash flow: € .five billion to € .6 billion (vs . c. € .seven billion pre Covid-19)[*].

The Group suspends its targets for 2021, the past yr of the a few-yr plan presented at the Trader Working day held on January 30, 2019. The Group will existing its vision as well as its mid-time period targets at the 2020 Analyst Working day (date to be rescheduled).

Postponement of Yearly Typical Assembly and outstanding cancellation of dividend payment in 2020

Owing to the outstanding instances linked to the Covid-19, the Board of Directors, which fulfilled on March 31, 2020, has made a decision to postpone the Yearly Typical Assembly in the beginning scheduled on May perhaps 14, 2020 to June 26, 2020.

In these unprecedented instances, throughout its session on April 21, 2020, the Board of Directors took the outstanding determination not to suggest the one.forty euro for each share dividend which was in the beginning viewed as to be submitted to the Yearly Typical Assembly. In addition, the Main Govt Officer as well as other members of the Typical Management Committee have made a decision to cut down by 30{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} their compensation throughout the current a few-thirty day period interval from March to May perhaps 2020. The Chairman of Atos’ Board of Directors has created the very same determination.

The Group confirms that the cancellation of the dividend this yr is an exception to its dividend policy with a spend-out ratio concerning 25{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} and 30{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} of Net income Group share.

 

Appendix

Income at frequent scope and exchange premiums reconciliation

In € million	Q1 2020	Q1 2019	{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654} transform
Statutory revenue	two,834	two,818	+.6{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Trade premiums outcome		26
Income at frequent exchange premiums	two,834	two,843	-.3{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}
Scope outcome		14
Trade premiums outcome on obtained/disposed perimeters		one
Income at frequent scope and exchange premiums	two,834	two,858	-.8{744e41c82c0a3fcc278dda80181a967fddc35ccb056a7a316bb3300c6fc50654}

Scope effects amounted to €+14 million for revenue and are mainly similar to the acquisition of Maven Wave, consolidated as of February one, 2020 (two months for €+eighteen million), the acquisition of IDnomic, consolidated as of October one, 2019 (3 months for €+four million), the acquisition of X-PERION, consolidated as of December one, 2019 (3 months for €+two million), the disposal of some particular Unified Interaction & Collaboration pursuits typically in Q1 2020 (full restatement of €-four million) as well as former ITO pursuits in the United kingdom beginning of H2 2019 (3 months for €-four million), and ultimately the disposal and decommissioning of non-strategic pursuits inside CVC.

Forex exchange premiums effects typically arrived from the American greenback as well as the British pound and positively contributed to revenue for €+26 million.

 

Conference call

Today, Wednesday, April 22, 2020, the Group will keep a conference call in English at 08:00 am (CET – Paris), chaired by Elie Girard, CEO, in get to comment on Atos’ Q1 2020 revenue and solution concerns from the money local community.

You can sign up for the webcast of the conference:

• on internet, in the Buyers section
• by smartphones or tablets by the scan of:
• by telephone with the dial-in, five-ten minutes prior the setting up time:
  • France             +33 one 70 70 07 81       code 12652364
  • Germany             +forty nine 69 2222 2625       code 12652364
  • United kingdom             +forty four 844 481 9752       code 12652364
  • US             +one 646 741 3167         code 12652364
  • Other nations around the world +forty four 2071 928338        code 12652364

Following the conference, a replay of the webcast will be available on atos.internet, in the Buyers section.

 

Forthcoming activities

June 26, 2020              Yearly Typical Assembly

July 27, 2020               Initial fifty percent 2020 outcomes

October 22, 2020         3rd quarter 2020 revenue

To be scheduled            2020 Analyst Working day