ATOS :Third quarter 2013 revenue
(Thomson Reuters ONE Via Acquire Media NewsEdge)
Revenue: EUR 2,086 million; -1.8 percent organically
Strong backlog: EUR 15.1 billion; Book to bill ratio: 85 percent
Net cash: EUR 353 million; Free cash flow: EUR 21 million
With revenue expected nearly stable, 2013 objectives confirmed
with an operating margin around 7.5 percent (vs. 6.6 percent in 2012),
free cash flow above EUR 350 million (vs. EUR 259 million in 2012),
and EPS up +50 percent compared to 2011
Paris, October 25(th), 2013 - Atos, an international information technology
services company, today announced its revenue for the third quarter of 2013.
Revenue was EUR 2,086 million, representing an organic evolution of -1.8 percent
compared to the third quarter of 2012. Order entry was EUR 1,780 million leading
to a book to bill ratio of 85 percent. Net cash stood at EUR 353 million at the
end of September 2013. The four largest Business Units are Germany with 20
percent of total revenue, the United Kingdom & Ireland with 19 percent,
Benelux & The Nordics with 13 percent and France with 11 percent.
Thierry Breton, Chairman and CEO at Atos said: "The economic environment
remained tough last quarter and cyclical activities have not restarted yet in
Europe but the Group continues investing to capture new growth opportunities and
our pipeline increased significantly. In this context, the Group maintains its
objectives of strong improvement in profitability and cash generation for 2013."
Q3 2013 revenue performance by Service Line
Managed Services revenue was EUR 987 million, down by -2.0 percent compared to
the third quarter of 2012. Revenue grew in all sectors but Manufacturing in
which the decline mainly impacted Germany. Growth was +14.0 percent in Public
sector, Healthcare, & Transport, thanks to the contribution of United Kingdom &
Ireland, Benelux & The Nordics, and North America Business Units. In Telco,
Media & Utilities, the contribution from the McGraw-Hill contract in North
America offset a revenue decrease with a large media company in the UK due both
to project delays and a lower comparison basis (Hardware sales in Q3 2012 not
repeated in 2013).
Over the first nine months of 2013, Managed Services revenue was EUR 2,985
million, representing an organic evolution of -0.6 percent.
In Systems Integration, revenue reached EUR 547 million, down -1.5 percent
compared to the third quarter of 2012. Telco, Media & Utilities, which is the
largest market served in Systems Integration, posted +15.6 percent growth mainly
thanks to the ramp-up of the NSN contract in Germany. In Financial Services,
revenue decline was due to the base effect of the AIG contract completed in Q3
2012 in the US. In the Public sector, revenue generated in 2012 for the London
Olympic Games led to an unfavorable comparison basis in Q3 2013. Finally in
Manufacturing, less discretionary expenses from large customers led to fewer
projects delivered in last quarter.
Over the first nine months of 2013, revenue for Systems Integration was
EUR 1,680 million, down by -1.0 percent.
Hi-Tech Transactional Services & Specialized Businesses (HTTS & SB) revenue
reached EUR 411 million, down by -1.7 percent year-on-year. HTTS business grew
by +3.4 percent to EUR 294 million, supported by a growth both in payment and
eCS. Financial BPO grew by +6.6 percent thanks to additional projects with NS&I,
while the activity was down by -16.8 percent in Medical BPO impacted by lower
volumes processed for DWP. Volume delays from Q3 this year to early 2014 in the
new DWP PIP contract will not be compensated in Q4 2013. The other Specialized
Businesses were impacted by a lower level of hardware sales in Civil & National
Security in Switzerland and Italy.
Over the first nine months of 2013, the HTTS business itself grew by +4.8
percent while Specialized Businesses posted a decline mainly due to Medical BPO.
The Service Line as a whole grew by +0.3 percent to EUR 1,255 million.
Consulting & Technology Services revenue was EUR 141 million, down
-1.9 percent compared to the third quarter of 2012. Consulting
activities were up +9.9 percent with almost all sectors back to growth. The
activity was strong in the UK, both in the Public sector and in Manufacturing.
Technology Services declined by -6.2 percent due in particular to
Financial Services and Public sector in France and in Benelux.
Over the first nine months of 2013, revenue for Consulting & Technology Services
was EUR 456 million, down by -6.6 percent.
Q3 2013 revenue performance by Business Unit
In Germany, revenue reached EUR 422 million, down by -2.2 percent. All the
Services Lines grew except Managed Services. More particularly, Systems
Integration was up +10.6 percent thanks to the contribution of the NSN contract.
In Managed Services, the Business Unit faced the effect of Neckermann
bankruptcy, the transition of Bayer contract invoiced in Q3 2012, and less
volumes with some large customers in Manufacturing.
In the United Kingdom & Ireland, revenue was stable at EUR 394 million. The
Business Unit grew by +14.9 percent in cyclical activities, mainly in Telco and
Manufacturing for Systems Integration and in the Healthcare sector for
Consulting. Revenue was down by -6.4 percent in BPO mainly due to the DWP
contract in Medical BPO and -3.7 percent in Managed Services due to comparison
basis and project delays with one large customer in the media sector.
Benelux & The Nordics posted revenue of EUR 266 million, almost stable with two
different trends: The Nordics grew by +20.3 percent thanks to the contribution
of the PostNord contract while Benelux limited its revenue decrease to -3.6
percent. Managed Services was up by +3.7 percent with PostNord but also
additional volumes with Philips. Cyclical activities were down by -7.6 percent
despite new contracts and additional projects with existing customers in the
Public sector which did not offset the ramp-down of several contracts in the
In France, the transformation programs implemented allow the Business Unit to be
in line with its 2013 recovery plan. In Q3, revenue reached EUR 238 million,
down as anticipated by -8.2 percent compared to the third quarter of 2012.
Managed Services decreased by -9.4 percent despite additional revenue coming
from the signature of contracts in Telco and Energy. The cyclical activities
declined by -6.5 percent year-on-year.
The Business Unit Atos Worldline is reported as such until the end of FY 2013
and represents part of Worldline. The performance of Worldline as a standalone
subsidiary is detailed in the section "Worldline performance" herein below.
Revenue in the third quarter reached EUR 222 million, +3.1 percent year-on-year.
By geography, France and Benelux grew both in projects and in transaction
processing. In Belgium, issuing business benefited from higher transaction
volumes. Germany was stable year-on-year with payment processing for banks
offsetting a decrease in the sale of terminals.
In Central & Eastern Europe, revenue declined by -7.2 percent to EUR 196
million. New projects in Turkey in the Public sector and in Slovakia in Telco
almost compensated for the AMS contract in Austria which terminated during the
fourth quarter of 2012. Most of the revenue decrease came from lower hardware
sales in Civil & National Security Specialized Businesses, mainly in
Revenue in North America grew by +5.4 percent to EUR 146 million led by Managed
Services with the contribution from the McGraw-Hill contract which started in Q3
2012. Growth also materialized in some contracts mainly in the Public sector and
partially compensated lower volumes with Siemens. In Systems Integration,
revenue coming from the successful completion of the AIG contract in Q3 2012 was
not repeated this year.
In Iberia, revenue reached EUR 81 million, up by +5.2 percent. In the third
quarter of 2013, the Business Unit benefited from the completion of a one-time
sale for a European public institution in Managed Services. Systems Integration
was stable while the activity in Consulting & Technology Services continues to
be tough in a severe economic environment, more particularly in Financial
Services and in the Public sector.
In Other Business Units, revenue was EUR 119 million, down by -6.6 percent.
Major Events was down EUR -10 million mainly representing Q3 2012 revenue for
the London Olympic Games. Excluding this base effect, the Business Unit grew in
Asia-Pacific, mainly in Telco, and in Latin America thanks to the e-Ticketing
Book to bill ratio was 85 percent, with Group order entry totaled
EUR 1,780 million in the third quarter of 2013. Book to bill reached 91 percent
in Q3 2013 excluding Siemens for which most of the IT contract was booked in
July 2011 and excluding BPO where the large NS&I contract was renewed in Q2 this
As of September 30(th), 2013, the full backlog remained strong at EUR 15.1
billion, representing 1.7 year of revenue.
The full qualified pipeline increased to EUR 5.4 billion compared to EUR 5.0
billion at the end of June 2013. The pipeline increase came from a stronger
commercial activity in Benelux & The Nordics, Germany and for Atos Worldline.
Considering this pipeline level and the timing of signatures, the Group expects
a strong book to bill ratio in the range of 110 to 130 percent in the fourth
Free cash flow and net cash position
Free cash flow amounted to EUR 21 million compared to EUR 32 million statutory
in the third quarter last year.
Considering an acquisition in Australia and the start of the share buy-back
program, the Group net cash position at 30 September 2013 reached EUR 353
million, compared to EUR 359 million at the end of June 2013.
The total number of Group employees was 77,080 at the end of the third quarter,
compared to 77,105 at the end of June 2013.
In the third quarter of 2013, 2,877 new employees were recruited of which 65
percent in the emerging countries.
Attrition for direct staff in the third quarter of 2013 was 10.6 percent,
compared to 9.6 percent for the first semester.
In the third quarter of 2013, Worldline revenue reached EUR 277 million,
up +5.5 percent year-on-year. Revenue was EUR 825 million for the first nine
months of the year, representing an organic growth of +5.4 percent.
In Merchant Services & Terminals, revenue was EUR 87 million, stable compared to
the third quarter of 2012. Revenue evolution was impacted by lower terminal
sales. Revenue grew in commercial acquiring at the same pace as in the first
semester, in e-Commerce in the UK and for loyalty and fuel cards in Iberia.
Over the first nine months of 2013, revenue reached EUR 264 million, up +2.3
The Mobility & e-Transactional Services revenue strongly grew by +10.8 percent
year-on-year at EUR 91 million. Growth came from the UK in e-Ticketing, from
Latin America in fare collection and e-Health solutions, and from new projects
delivered in France.
Revenue was EUR 273 million for the first nine months of 2013, representing an
organic growth of +10.3 percent.
In Financial Processing & Software Licensing, revenue grew +6.4 percent to
EUR 99 million. Growth was mainly generated in Benelux and France with higher
volume of transactions in the issuing business and thanks to new projects with
The Business Line revenue grew +4.0 percent year-to-date to EUR 287 million.
With revenue expected nearly stable compared to 2012, the Group maintains its
ambition to reach the objectives as stated in the February 21(st), 2013 release,
The Group has the objective to improve its operating margin rate to around
7.5 percent of revenue compared to 6.6 percent in 2012.
Free cash flow
The Group has the ambition to achieve a free cash flow above EUR 350 million.
Earnings per share (EPS)
The Group confirms its ambitions for an EPS (adjusted, non-diluted) representing
an increase of +50 percent compared to 2011 statutory (up +25 percent compared
Revenue at constant scope and exchange rates reconciliation
Scope impact is related to an acquisition in Australia on July 1(st), 2013.
Exchange rate impact mainly came from the variation of the British pound, US
dollar, Brazilian real and Argentinian peso versus the Euro.
Q3 2013 performance by Market
Today, Friday October 25(th), 2013, Senior Executive Vice President Gilles
Grapinet, and Chief Financial Officer Michel-Alain Proch will comment on Atos'
third quarter 2013 revenue and answer questions from the financial community
during a conference call in English starting at 8:00 am (CET - Paris).
The audio conference numbers are:
France dial-in: +33 1 70 99 32 08 code 937498
UK dial-in: +44 20 71 62 00 77 code 937498
US dial-in: +1 334 323 6201 code 937498
The conference (audio and webcast) and the presentation will also be available
on our website at: atos.net, in the Investors section.
15 November 2013 Analyst Day
Investor Relations: Gilles Arditti Tel +33 (0)
1 73 26 00 66
Press: Josephina de Vries Tel +31 (0)
6 30 27 26 11
Benedicte Brissart-Rullier Tel +33 (0) 1 73 26 13 97
Atos SE (Societas europaea) is an international information technology services
company with 2012 annual revenue of EUR 8.8 billion and 77,100 employees in 52
countries. Serving a global client base, it delivers IT services in 3 domains,
Consulting & Technology Services, Systems Integration and Managed Services &
BPO, and transactional services through Worldline. With its deep technology
expertise and industry knowledge, it works with clients across the following
market sectors: Manufacturing, Retail & Services; Public sector, Healthcare &
Transports; Financial Services; Telco, Media & 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 & Paralympic Games and is quoted
on the NYSE Euronext Paris market. Atos operates under the brands Atos, Atos
Consulting & Technology Services, Worldline and Atos Worldgrid. For more
information, visit: atos.net.
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 2012 Reference Document filed with the Autorité des Marchés Financiers (AMF)
on April 3(rd), 2013 under the registration number: D13-0271 and its update
filed with the Autorité des Marchés Financiers (AMF) on July 31(th), 2013 under
the registration number: D13-0271-A01.
Business Units include Germany, France, United Kingdom & Ireland, Benelux & The
Nordics (The Netherlands, Belgium, Luxembourg, Denmark, Finland, Sweden, and
Estonia), Atos Worldline (French, German, Belgian, Asian, and Indian
subsidiaries), Central & Eastern Europe (CEE: Austria, Bulgaria, Croatia,
Serbia, Poland, Czech Republic, Russia, Romania, Slovakia, Hungary, Switzerland,
Italy, and Turkey), North America (USA and Canada), Iberia (Spain, Portugal, and
Andorra), 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, New
Zealand, and Australia), India, Middle East (UAE, Qatar, and Saudi Arabia),
Morocco, South Africa, and New Business Ventures (blueKiwi, Yunano and Canopy).
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.
Atos Third quarter 2013 revenue:
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originality of the information contained therein.
Source: ATOS via Thomson Reuters ONE
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