“Q1 2010 Revenues”
PARIS – 14 April 2010
- First quarter 2010 revenue: EUR 1,231 million
- Order entries up: +17 per cent
- Book to bill ratio: 128 per cent
- Further reduction of net debt: down to EUR 130 million
Today, Atos Origin, an international IT services company, reported revenue of EUR 1,231 million for the first quarter of 2010 representing a decline of -5.5 per cent at same scope and exchange rates. This figure is in line with the full year revenue objective which takes into account that the revenue in the first quarter of 2009 was flat compared to the first quarter of 2008 at
Total order entries for the first quarter of 2010 were EUR 1 577 million up +17 per cent organically compared to the same period last year. The book to bill ratio was 128 per cent compared to 104 per cent for the first quarter of 2009.
By service line, the book to bill ratio was:
- 139 per cent in Consulting (84 per cent in Q1 2009);
- 130 per cent in Systems Integration (107 per cent in Q1 2009);
- 129 per cent in Managed Services (112 per cent in Q1 2009);
- 135 per cent in Hi-Tech Transactional Services (HTTS) (100 per cent in Q1 2009).
During the first quarter of 2010, the Group renewed key contracts in Managed Services with a large bank in Hong Kong, the Government in the United Kingdom and KPN in The Netherlands. In HTTS and payment systems contracts were renewed with Dexia, KBC and ING in Belgium and in Systems Integration with Renault in France and BP in Germany.
Several new contracts were signed during quarter one, including the Health Personal File for HTTS in France and VOSA in the United Kingdom for Managed Services. For Systems Integration two major contracts were agreed with KPN in The Netherlands as well as with BBVA in Spain, Commerzbank in Germany and the Government and EDF Group in France. For Consulting, a contract was signed with the Department for International Development in the United Kingdom.
On 31 March 2010, the full backlog was EUR 7.2 billion, representing 1.4 year of revenue, compared to EUR 6.9 billion at 31 December 2009.
The full pipeline weighted in accordance with industry practice was EUR 2.8 billion at the end of March 2010 at the same level as 31 March 2009.
Revenue by Service Line
Representing 36 per cent of the Group, Managed Services revenue was EUR 448 million in the first quarter, down -4 per cent, of which -3 per cent was due to the ramp-down, as expected, of the Arcandor contract in Germany.
Representing 36 per cent of the Group, Systems Integration revenue was EUR 448 million, down
-9 per cent in the first quarter compared to -12 per cent and -14 per cent in the fourth and the third quarters of 2009 respectively. The improvement was led by France where the activity improved by +1 per cent. The utilisation rate remained stable at 81 per cent.
Representing 19 per cent of the Group, HTTS revenue was EUR 238 million, up +1 per cent. In each GBU, the transaction volumes in payments continued to grow. However, demand in customised development in payments in France and in Germany slowed down slightly during the first quarter. As expected the revenue in Financial Services decreased following the termination of the Euroclear contract during the second half of 2009. As part of the roll-out of Atos Worldline offerings in the countries of the Group, both the United Kingdom and Asia contributed to the HTTS revenue.
Representing 5 per cent of the total, Consulting revenue was EUR 57 million, down -20 per cent compared to -14 per cent and -34 per cent in the fourth and third quarters respectively of last year. The decline was limited to -2 per cent in France but The Netherlands and the United Kingdom declined further despite first signs of recovery. The weighted pipeline increased +17 per cent compared to December 2009 and +47 per cent compared to March 2009. The utilisation rate was 69 per cent during the first quarter of 2010 thanks to tight management of the workforce.
In Medical BPO, the revenue was EUR 40 million, representing 3 per cent of the Group and was up +7 per cent thanks to an increase in the number of medical assessments processed in the United Kingdom.
Revenue by Global Business Unit
In France, revenue was flat at EUR 289 million compared to the same period in 2009. Systems Integration was back to growth at +1 per cent thanks to the distinctive offerings in the Energy and Utilities sector which compensated for the decline in both the Public Sector and the Telecom markets. The Group launched the project to regroup these innovative offerings in a dedicated subsidiary Atos WorldGrid. In Managed Services and in Consulting, activity remained flat.
Revenue in the Benelux was EUR 234 million, down -12.8 per cent compared to the first quarter of 2009 and down -6 per cent compared to the last quarter of 2009. The decline was limited to -3 per cent in Managed Services. In Consulting and Systems Integration, the decline was -23 per cent compared to the first quarter of 2009 and was limited to -6 per cent when comparing to the fourth quarter of 2009.
In the United Kingdom, revenue totalled EUR 211 million down -2.4 per cent organically. In Managed Services, the revenue increased +2 per cent thanks to the growth in the Public Sector and Financial Services markets. Systems Integration was down in the Private Sector while it remained strong and growing in the Public Sector. In Consulting, revenue decreased by EUR -3 million due to lower revenue in Health while the Financial Services market started to recover. In HTTS, the revenue grew +8 per cent with the ramp-up of the contract with Capita and an increase in payment transactions. Finally, Medical BPO reported a +7 per cent growth mainly thanks to the increase of transaction volumes.
Atos Worldline revenue for the first quarter was EUR 202 million, slightly up +0.2 per cent. The increase in the number of payment transactions combined with strong order entries means that the Group anticipates higher organic growth starting from the second half of 2010.
In Germany central Europe / EMA, revenue was EUR 122 million, down -17.5 per cent organically; of which half of the decline was due to the ramp down of the Arcandor contract. Excluding the effect of Arcandor, Managed Services remained stable but could not compensate for the decline in Systems Integration in particular in the telecom sector.
In Iberia / South America, revenue was EUR 97 million down -12 per cent. Tough economic conditions have continued to affect the Consulting and Time & Materials businesses while the price pressure observed during 2009 has started to slow down since the beginning of 2010 particularly in the private sector.
The GBU Rest of the World reported revenue of EUR 75 million, up +11.4 per cent organically. This increase was led by a strong performance in Asia both in Systems Integration and HTTS, as well as the contribution of the Olympic and Paralympic Games in Vancouver.
Group net debt on 31 March 2010 was reduced further to EUR 130 million - including the acquisition of the company Shere in the United Kingdom - compared to EUR 139 million at 31 December 2009. The net operating cash flow amounted to EUR 29 million during the first quarter of 2010 compared to EUR 8 million for the same period last year. The Group has pursued its actions to monitor tightly capital expenditure and to improve working capital.
The number of employees at the end of March 2010 was 48 341 compared to 49 036 at the end of December 2009.
As in 2009, the Company has maintained its Human Resources policy focussed on protecting both the employment and the capability to remain employable for its staff. The Group recruited recently graduated engineers in all Global Business Units and for all roles in emerging countries. More than 950 new recruits joined the Group in the first quarter of 2010.
The attrition rate was 8.3 per cent slightly up compared to 7.3 per cent in 2009. The Group has continued its reorganisation program with more than 600 people leaving the Company during the first quarter of 2010.
The Group has pursued its efforts to maintain the number of subcontractors around 5 per cent of total staff. Total external subcontractors were 2 556 at the end of March 2010 compared to 2 491 at the end of December 2009.
In Systems Integration and in Consulting, the average number of staff on the bench in the first quarter of 2010 was 1 001 compared to 909 in the last quarter of 2009. Training for engineers on the bench has been pursued since the beginning of the year.
After three months of activity, the Group confirms its objectives for 2010 as communicated to the market during the 2009 Annual Results presentation on 17 February 2010. Priorities of the Group in 2010 will be again to maintain and further improve the skills of its staff, to improve operating margin and cash generation as per its three-year plan.
As part of its 2009-2011 plan to improve its profitability, the Group confirms its ambition to increase its operating margin by +50 to +100 basis points in 2010.
The Group has the objective to confirm the improvement achieved in 2009 by generating a net operational cash flow in the same range in 2010.
Due to the Arcandor bankruptcy, the Group expects in 2010 a slight revenue organic decrease, however at a lesser extent than the one achieved in 2009.
|27 May 2010||Annual General Meeting|
|28 July 2010||First Half 2010 results|
|14 October 2010||Third quarter 2010 revenue|
Global Business Units include France, United Kingdom, Benelux (The Netherlands, Belgium and Luxembourg), Atos Worldline (French, German and Belgium subsidiaries), GCEMA (Germany Central Europe with Austria, Poland, and Mediterranean countries and Africa which include South Africa, Greece, Turkey and Switzerland), Iberia / South America (Spain, Portugal, Argentina, Brazil and Columbia), and Rest of the World (Asia Pacific including China, Hong Kong, Singapore, Malaysia, Indonesia, Taiwan, Japan as well as North America, India, Major Events, Middle East with Dubai and Morocco).
Revenue organic growth is presented at constant scope and exchange rates.
The document contains further forward-looking statements that involve risks and uncertainties concerning the Group's expected growth and profitability in the future. 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 2009 Reference Document filed with the Autorités des Marchés Financiers (AMF) on 1 April 2010 under the registration number: D10-0199.
About Atos Origin
Atos Origin is a leading international information technology (IT) services company, providing hi-tech transactional services, consulting, systems integration and managed operations to deliver business outcomes globally. The company's annual revenues are EUR 5.1 billion and it employs 49,000 people. Atos Origin is the Worldwide Information Technology Partner for the Olympic Games and has a client base of international companies across all sectors. Atos Origin is quoted on the Paris Eurolist Market and trades as Atos Origin, Atos Worldline and Atos Consulting.
Tel. : +33 (0) 1 55 91 26 33,
Investor contact :
Tel. : +33 (0) 1 55 91 28 83,