First quarter 2012 revenue
Paris, 25 April 2012
Atos, an international information technology services company, today announced its revenue for the first quarter of 2012. Revenue was EUR 2,163 million, representing organic growth of +2.4 per cent compared to the first quarter of 2011. Net cash stood positive at EUR 34 million at the end of March 2012.
Thierry Breton, Chairman and CEO, said: “The first quarter showed a good start of the year confirming an expected solid year 2012. Revenue again grew more than 2 per cent thanks to our strategy following the acquisition of SIS to focus on strengthening our recurring activities. As we committed, the Group is cash positive for the first time since its creation. I am also glad that we finalized the alliance with EMC² and VMware to create Canopy, which positions Atos as one of the leading global players in cloud services.”
Revenue constant scope and exchange rates reconciliation
|In EUR Million||Q1 2012||Q1 2011||% growth|
|Statutory revenue|| |
|Scope impact|| |
|Exchange rates impact|| |
|Revenue at constant scope and exchange rates|| |
Revenue performance by Service Line
|In EUR Million||Q1 2012||Q1 2011*||% growth|
|Managed Services|| |
|Systems Integration|| |
|HTTS & Specialized Businesses|| |
|Consulting & Technology Services|| |
|Total Group|| |
Representing 46 per cent of the Group, Managed Services revenue was EUR 995 million, up +3.9 per cent compared to the first quarter of 2011. Growth was driven by several geographies including Germany (+6 per cent), North America (+7 per cent), Central & Eastern Europe (+10 per cent) and the UK (+3 per cent). In Benelux and Iberia, revenue was almost stable despite the continued tough market conditions. Revenue in France was down -6 per cent year-on-year but returned to growth sequentially compared to the third and the fourth quarter of 2011. Following the acquisition of SIS, the Service Line has been able to grow by signing multi-year contracts with new customers.
In Systems Integration, representing 25 per cent of the Group, revenue was stable compared to the first quarter of 2011 at EUR 536 million. The start of the year was better than anticipated. The activity grew in Germany, North America, North & South Western Europe and Latin America. Revenue in Benelux showed a further decline due to the continued difficult market conditions. In France, as planned, actions initiated last year to turnaround and to improve the situation are now being implemented.
Representing 22 per cent of the Group, Hi-Tech Transactional Services & Specialized Businesses (HTTS & SB) revenue was EUR 474 million, up +2.9 per cent year-on-year. HTTS business grew by +5.7 per cent mainly driven by e-CS revenues at +14.9 per cent.
For Consulting & Technology Services, which represent 7 per cent of the Group, revenue was stable compared to the first quarter of 2011 at EUR 158 million. In Consulting, utilization rate was 72 per cent compared to 70 per cent for full year 2011 and stable at 84 per cent for Technology Services. The increased activity in Technology Services in France (+9 per cent) mainly for Public Sector, and in Consulting in the UK, offset the decline of the Service Line in the Netherlands (-8 per cent) in Financial Services and Manufacturing sectors.
Revenue performance by Group Business Unit (GBU)
|In EUR Million||Q1 2012||Q1 2011*||% growth|
|United-Kingdom & Ireland|| |
|Atos Worldline|| |
|North America|| |
|Central and Eastern Europe|| |
|North & South West Europe|| |
|Other BUs|| |
|Total Group|| |
For the third quarter in a row, the growth was driven by most of the GBUs, and in Europe primarily by the Northern, Central and Eastern geographies.
In Germany, revenue was EUR 418 million, representing a growth of +6.1 per cent. Managed Services strong growth came from the ramp-up of new contracts signed in 2011 and higher business volumes in the Manufacturing sector. In Systems Integration, revenue grew by +4.9 per cent with additional projects which more than compensated the phase out of the Application Management contract with a large German Bank.
In the United Kingdom & Ireland, revenue was EUR 390 million, up +5.8 per cent compared to the first quarter of 2011. Managed Services was up +3.1 per cent due to increased volumes and to the start of delivering new deals won in the fourth quarter of 2011. Systems Integration grew +1.3 per cent. HTTS & SB grew +10.2 per cent due to higher project revenue and volumes notably in the Transport sector.
In Benelux, revenue in the first quarter was EUR 248 million, down -5.2 per cent. In Managed Services, the activity was almost flat compared to the same period last year, thanks to Financial Services in the Netherlands and new clients in Belgium. Difficult market conditions, price pressure and lower volumes continued to affect both Systems Integration and Consulting & Technology Services. The GBU remains focused on margin protection by improving workforce management.
Revenue in France was EUR 255 million, representing an organic decline limited to -1.6 per cent year-on-year, following -6 per cent in the third quarter of 2011 and -4 per cent in the fourth quarter of 2011. In Managed Services, the activity was stabilized compared to the fourth quarter of 2011 thanks to increased business in Energy & Utilities and stable volumes in Financial Services. Technology Services grew by +9 per cent year-on-year with an improved utilization rate above of 84 per cent. In Systems Integration, revenue was down in Manufacturing (automotive industry) and with mobile phone operators.
Revenue for Atos Worldline was EUR 226 million up +1.8 per cent year-on-year. Payment activities were stable due to lesser volume growth in the credit card business in Belgium. eCS was up +8.9 per cent with additional project revenue and hardware sales in France. Financial Market division was stable year-on-year.
In North America (NAM) revenue was EUR 134 million, up +8.4 per cent. Managed Services revenue was up +6.6 per cent following stronger activity with large manufacturing companies. Systems Integration reported a solid growth thanks to an increase of business in Financial Services.
In Central & Eastern Europe (CEE) revenue was EUR 130 million, up +1.2 per cent. Managed Services revenue increased +9.7 per cent thanks to higher volumes in several countries including Turkey and Czech Republic. Systems Integration was down -9.0 per cent. The decline was due in part to less discretionary spending in the Public sector in several countries. It was also due to a one-time hardware sale in Austria in the first quarter of 2011.
In North & South West Europe (N&SWE) revenue was EUR 99 million, up +5.5 per cent. The GBU had a strong growth both in Managed Services and Systems Integration, respectively up +9.2 per cent and +15.2 per cent. The increase materialized primarily in the Manufacturing sector and overcompensated less hardware revenue in the Civil & National Security business compared to the same quarter last year.
In Iberia, revenue was EUR 82 million, down -4.2 per cent. While Systems Integration, thanks to the Telco sector, and Managed Services reported stable revenue, Consulting & Technology Services suffered from the economic conditions mainly in Public Sector and Financial Services.
In Other Business Units, revenue was EUR 181 million, up +2.7 per cent compared to the first quarter of 2011.
The Group order entries for the first quarter of 2012 totaled EUR 2,312 million, representing a book to bill ratio of 107 per cent. Book to bill was 109 per cent for recurring businesses (Managed Services, HTTS & Specialized Businesses) and 102 per cent for cyclical activities (Systems Integration and Consulting & Technology Services). Excluding Siemens, for which the outsourcing and application management elements of the Global IT contract were booked in the backlog in July 2011, the book to bill ratio was 110 per cent.
At the end of the first quarter of 2012, the full backlog was EUR 14.5 billion representing 1.7 years of revenue, compared to EUR 14.1 billion at the end of 2011. The increase came from the book to bill ratio, the exchange rates effect, and the enlarged scope represented by deferred assets from the SIS acquisition.
The full qualified pipeline on March 31st, 2012 was EUR 5.4 billion, at the same level as December 31st, 2011 despite some significant bookings which occurred in Q1 2012. It represents 7.4 months of revenue with the three largest Service Lines (Managed Services, Systems Integration, and HTTS & SB) counting between 7.4 and 7.8 months of revenue.
In the first quarter of 2012, the Group pursued actively the implementation of its eXpand Program to reinforce its growth potential and to fully materialize the benefits of the top line synergies brought by the SIS acquisition.
Net cash and free cash flow
Net cash position on March 31st, 2012 was EUR 34 million.
During the first quarter of 2012, the acquisition of 100 per cent of e-utile, an Italian company in the smart energy sector, was completed. The cash impact for this transaction was EUR 18 million, including a net debt of EUR 8 million.
The free cash flow during the first quarter of 2012 was EUR 34 million compared to EUR 24 million for the first quarter of 2011.
The total number of Group employees was 74,992 at the end of March 2012.
The number of direct employees was 67,861 at the end of March 2012, representing 90.5 per cent of the total headcount, compared to 89.5 per cent at the end of December 2011.
During the first quarter of 2012, 2,948 new employees were recruited while attrition was stable at 11 per cent and, as planned, 986 employees were restructured.
Staff in the emerging countries represented more than 20 per cent of total staff at the end of March 2012, with half of them located in India.
At the end of March, the number of external subcontractors was around 8,000 stable compared to the end of 2011.
The Group confirms all its objectives for 2012 as stated in the February 23rd, 2012 release, i.e.:
In the current economic environment, the Group expects a slight revenue organic growth compared to proforma 12 months 2011.
Thanks to the continued integration of SIS and the roll out of the TOP² Program, the Group has the objective to improve its operating margin rate to 6.5 percent of revenue compared to 4.8 percent for proforma 12 months 2011.
Free cash flow
The Group has the ambition to achieve a free cash flow of around EUR 250 million.
The improvement compared to 2011 statutory is expected from the increase in operating margin and a tougher control on capital expenditure and working capital.
Earnings per share (EPS)
The Group forecasts EPS (adjusted, non diluted) in line with the +50 percent increase targeted for 2013 compared to 2011 statutory.
Today, April 25th, 2012, Gilles Grapinet, Senior Executive Vice President in charge of Global Functions, along with Michel-Alain Proch, Chief Financial Officer will comment on Atos' revenue for the first quarter 2012 and answer questions from the financial community during a conference call in English starting at 9:00 am (CET - Paris).
The audio conference numbers are:
France dial-in : +33 1 70 99 32 08 code 915669 UK dial-in : +44 207 162 00 77 code 915669 US dial-in : +1 334 323 6201 code 915669
The conference (audio and webcast) and the presentation will also be available on our website, in the Investors section.
|30 May 2012||Annual General Meeting|
|27 July 2012||First Half Results 2012|
|25 October 2012||Third quarter Revenue 2012|
Atos is an international information technology services company with annual 2011 pro forma revenue of EUR 8.5 billion and 74,000 employees in 48 countries. Serving a global client base, it delivers hi-tech transactional services, consulting and technology services, systems integration and managed services. With its deep technology expertise and industry knowledge, it works with clients across the following market sectors: Manufacturing, Retail, Services; Public sector, Healthcare & Transport; Financial Services; Telecoms, Media & Technology; Energy & Utilities.
Atos is focused on business technology that powers progress and helps organizations to create their firm of the future. It is the Worldwide Information Technology Partner for the Olympic and Paralympic Games and is quoted on the Paris Eurolist Market. Atos operates under the brands Atos, Atos Consulting & Technology Services, Atos Worldline and Atos Worldgrid.
Tel +44 77 333 100 86
Tel +33 (0) 1 73 26 00 66
This 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 2011 Reference Document filed with the Autorité des Marches Financiers (AMF) on April 5th, 2012 under the registration number: D12-0288.
Global Business Units include Germany, France, United Kingdom & Ireland, Benelux (The Netherlands, Belgium and Luxembourg), Atos Worldline (French, German, Belgian, Asian and Indian subsidiaries), Central & Eastern Europe (CEE: Austria, Bulgaria, Croatia, Serbia, Poland, Czech Republic, Russia, Romania, Slovakia and Turkey), North America (NAM: USA and Canada), North & South West Europe (N&SW Europe: Switzerland, Italy, Denmark, Finland, Sweden & Greece), Iberia (Spain & Portugal), and Other Business Units including Major Events, Latin America (Brazil, Argentina, Mexico, Colombia and Chile), Asia Pacific (Japan, China, Hong Kong, Singapore, Malaysia, Indonesia, Philippines, Taiwan, Thailand and Australia), IMEA (India, Middle East, Morocco and South Africa) and Atos Worldgrid.
Revenue organic growth is presented at constant scope and exchange rates.
Adjusted (non diluted) Earnings Per Share (EPS) represents the net income adjusted of restructuring, rationalization and customer relationship amortization, net of tax, divided by the weighted average number of shares during the year.
The AtoS proforma financial information for the 18 months to 30 June 2011 comprises the results of the former Atos Origin perimeter and the acquired scope of the ex Siemens IT Services (SIS), as if AtoS had been in existence since 1 January 2010. The information is provided as guidance only and is unaudited. The key assumptions used in the preparation of the information are as follows:
The proforma information has been prepared using accounting policies consistent with those used in the historic Atos Origin interim and year-end financial statements;
Proforma tax is based on the estimated effective rate of tax for AtoS for the relevant periods applied to proforma profit before taxation.
The proforma Profit and Loss account excludes significant exceptional items as being non-recurring, notably provisions on contract risks recorded in the first semester 2011.