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Atos — Atos Origin — FY2009 Earnings Presentation
70 slides from Atos's earnings presentation, Feb 17, 2010
Slide 1: Atos Origin Full Year 2009 Results
Atos Origin Full Year 2009 Results February 17th, 2010 Atos, Atos and fish symbol, Atos Origin and fish symbol, Atos Consulting, and the fish itself are registered trademarks of Atos Origin SA. February 2009 © 2009 Atos Origin. Confidential information owned by Atos Origin, to be used by the recipie
Slide 2: Disclaimers
Disclaimers » This presentation contains further forward-looking statements that involve risks and uncertainties concerning the Group’s expected growth and profitability for 2008. Actual events or results may differ from those described in this presentation due to a number of risks and uncertainties
Slide 3: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’ 2009 Results » 3. Reinventing Atos Origin » 4. Objectives for 2010 3 Atos Origin FY 2009 / Feb. 17, 2010
Slide 4: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’ 2009 Results » 3. Reinventing Atos Origin » 4. Objectives for 2010 4 Atos Origin FY 2009 / Feb. 17, 2010
Slide 5: 2009: We reached our commitments
2009: We reached our commitments » Operating margin: ambition to improve by +50 to +100 basis points compared to 2008 i.e. 5.3% - 5.8% Achievement: 5.7% with 4.6% in H1 and 6.8% in H2 » Cash generation: objective of a positive free cash flow Achievement: Net debt reduction by EUR 165 M, with Operati
Slide 6: 2009 Highlights: Reinventing Atos Origin
2009 Highlights : Reinventing Atos Origin » Implementation of the TOP Program as planned » Significant improvement of our operational performance » New TOP programs added (sales, Well Being at Work) » Achievement of offshore objectives » Deployment of Lean management » Solid commercial activity » Re
Slide 7: Solid commercial activity
Solid commercial activity » Total order entry of EUR 5 148 million representing a book to bill ratio at 100% as in 2008 » Full backlog at EUR 6.8 billion, representing 1.3 year of revenue after EUR 0.4 billion of cancellation for Arcandor » Full qualified pipeline at EUR 3.0 billion, increased by +1
Slide 8: Some customers' contracts won in Q4 2009
Some customers’ contracts won in Q4 2009 » In France Customers Service Line Deals Renault SI Renewal and extension of new developments and maintenance Major Bank MS 24/7 server monitoring on infrastructure services for the bank Major Public deal MS Management of all the desktop and mail engineering
Slide 9: Some customers' contracts won in Q4 2009
Some customers’ contracts won in Q4 2009 » In the UK Customers Service Line Deals Skills Development Scotland SI / MS Application management for enterprise content management systems Capita Life & Pensions SI/MS/HTTS Application support and development Brakes MS 10 years outsourcing with virtualisat
Slide 10: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’09 Results » Operational Performance » Financial results » 3. Reinventing Atos Origin » 4. Objectives for 2010 10 Atos Origin FY 2009 / Feb. 17, 2010
Slide 11: 2009 Financial Highlights
2009 Financial Highlights » Financial performance » Revenue at EUR 5,127 M with an organic decrease at -3.7% » 71% of total revenue is recurring business, 94% European basis, 77% covered by 4 main sectors » Operating margin at EUR 290 M (5.7% of revenue), representing an increase of +13% at same sco
Slide 12: Revenue organic change at -3.7%
Revenue organic change at -3.7% In € Million FY 2009 FY 2008 ∆% Revenue 5,127 5,623 -8.8% Italy (20) AEMS Exchange (125) Other disposals (54) Exchange rates impact (101) Revenue at constant scope and exchange rates 5,127 5,324 -3.7% 12 Atos Origin FY 2009 / Feb. 17, 2010
Slide 13: Operating Margin evolution
Operating Margin evolution 172 290 135 257 122 118 6.8% 4.6% 4.6% 5.0% 5.7% 4.8% H1 H2 FY 2008 2009 NB: all figures based at 2009 scope and exchange rates (M€) » Full year 2009 OM% up by +84 pts compared to 2008 » In 2009, full effect of TOP Program in H2 13 Atos Origin FY 2009 / Feb. 17, 2010
Slide 14: 2009 Performance by service line
2009 Performance by service line Revenue Operating Margin Operating Margin % % organic In EUR Million FY 2009 FY 2008 FY 2009 FY 2008 FY 2009 FY 2008 growth Managed Services 1,953 1,870 +4.4% 106.8 97.2 5.5% 5.2% Systems Integration 1,894 2,133 -11.2% 94.8 87.7 5.0% 4.1% High Tech Transactional Serv
Slide 15: Managed Services
Managed Services 2008 % Organic In € Million 2009 proforma (*) Revenue 1,953 1,870 +4.4% Operating margin 106.8 97.2 +9.9% Operating margin rate 5.5% 5.2% +0.3 pt Headcount at closing (Dec) 16,411 16,610 -1.2% (*) At 2009 scope and exchange rates » Revenue breakdown by GBU ISAM ROW 4% 7% Benelux 28%
Slide 16: Systems Integration
Systems Integration 2008 % Organic In € Million 2009 proforma (*) Revenue 1,894 2,133 -11.2% Operating margin 94.8 87.7 +8.0% Operating margin rate 5.0% 4.1% +0.9 pt Headcount at closing (Dec) 23,033 24,402 -5.6% (*) At 2009 scope and exchange rates » Revenue breakdown by GBU France 34% Benelux 18%
Slide 17: High Tech Transactional Services
High Tech Transactional Services 2008 % Organic In € Million 2009 proforma (*) Revenue 879 849 +3.5% Operating margin 135.6 126.1 +7.5% Operating margin rate 15.4% 14.9% +0.6 pt Headcount at closing (Dec) 5,261 5,325 -1.2% (*) At 2009 scope and exchange rates » Revenue breakdown by GBU Iberia 3% UK
Slide 18: Consulting
Consulting % Organic In € Million 2009 2008 (*) Revenue 248 325 -23.7% Operating margin 3.2 15.6 -79.6% Operating margin rate 1.3% 4.8% -3.5 pt Headcount at closing (Dec) 2,087 2,667 -21.7% (*) At 2009 scope and exchange rates » Revenue breakdown by GBU ROW France 1% 14% Benelux 42% UK 21% ISAM 22%
Slide 19: Medical BPO
Medical BPO 2008 % Organic In € Million 2009 proforma (*) Revenue 153 148 +3.5% Operating margin 19.6 12.6 +55.2% Operating margin rate 12.8% 8.5% +4.3 pt Headcount at closing (Dec) 1,880 1,680 +11.9% (*) At 2009 scope and exchange rates UK 100% 19 Atos Origin FY 2009 / Feb. 17, 2010
Slide 20: 2009 performance by Group Business Unit
2009 performance by Group Business Unit Revenue Operating Margin Oper. Margin % % organic In MEUR FY 2009 FY 2008 FY 2009 FY 2008 FY 2009 FY 2008 growth (*) France 1,136 1,171 -3.0% 44.7 25.4 3.9% 2.2% Benelux 997 1,154 -13.6% 84.2 94.3 8.4% 8.2% United Kingdom 902 840 +7.4% 82.1 61.3 9.1% 7.3% Atos
Slide 21: Headcount evolution
Headcount evolution » Total staff net decrease of 1,900 in 2009 while paying strong attention to maintain employability and key competencies » Hiring: total of +4,500 new engineers in 2009 ; with almost half in offshore countries » Lay-offs and dismissals at almost 3,000 » Staff attrition significan
Slide 22: Headcount evolution per quarter
Headcount evolution per quarter 51 452 51 115 50 345 50 312 49 607 49 655 49 004 49 026 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Constant decrease of number of average headcount in 2009 22 Atos Origin FY 2009 / Feb. 17, 2010
Slide 23: Offshore staff raise in 2009
Offshore staff raise in 2009 »Acceleration of recruitments on the second Half: 1 024 507 315 271 Q1 09 Q2 09 Q3 09 Q4 09 »More than 70% of our offshore staff is located in India 168 438 239 217 398 170 + 518 125 57 3,601 3,328 306 503 2008: 4,516 offshore employees 2009: 5,034 offshore employees Ind
Slide 24: Staff by Group Business Unit
Staff by Group Business Unit Closing Closing (in units) Change since opening Dec 2009 Dec 2008 France 12,401 12,737 (336) -2.6% Benelux 7,750 9,038 (1288) -14.3% United Kingdom 6,269 6,313 (44) -0.7% Atos Worldline 4,804 4,847 (43) -0.9% Germany Central Europe & EMA 3,746 3,838 (92) -2.4% Iberia / S
Slide 25: Attrition rate by Service line
Attrition rate by Service line » All service lines reduced attrition in 2009 : Consulting is down by -11 pts, Systems Integration by -6 pts, Managed Operations -5 pts. 23,6% 20,6% 14,7% 14,4% 13,6% 13,3% 10,8% 11,2% 11,0% 9,9% 8,6% 8,0% 7,5% 7,0% 6,2% 5,6% Jun 08 Dec 08 Jun 09 Dec 09 Consulting Syst
Slide 26: Subcontractors: a significant reduction since end 2008
Subcontractors: a significant reduction since end 2008 » Since December 2008, number of subcontractors constantly decreased through the year down by 1,500 4 469 -38% 4 008 3 933 2 517 2 433 Dec 07 Jun 08 Dec 08 Jun 09 Dec 09 26 Atos Origin FY 2009 / Feb. 17, 2010
Slide 27: Evolution of quarterly average bench
Evolution of quarterly average bench » Bench strongly reduced by 39% since January 2009 from almost 1,500 to 900 staff -39% 1,479 1,292 1,147 1,074 1,012 941 936 909 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 27 Atos Origin FY 2009 / Feb. 17, 2010
Slide 28: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’09 Results » Operational Performance » Financial Results » 3. Reinventing Atos Origin » 4. Objectives for 2010 28 Atos Origin FY 2009 / Feb. 17, 2010
Slide 29: Arcandor situation and impact on 2009 Group accounts
Arcandor situation and impact on 2009 Group accounts Key Financial Arcandor bankruptcy Atos Origin management statement impact dates chronology actions (in million euros) June Conclude agreement with Insolvency filed for Primondo administrator granting AO a payment (14 M) for bad debt 2009 Quelle, K
Slide 30: Statutory Income statement
Statutory Income statement FY 2009 excl. Arcandor In € Million FY 2009 FY 2008 Arcandor Bankruptcy bankruptcy Operating Margin 304 (14) 290 266 Restructuring (111) (30) (141) (98) Rationalization (43) (7) (50) (5) Paris offices rationalisation (36) (36) Assets Write Off (15) (15) Goodwill impairment
Slide 31: New headquarters in Bezons
New headquarters in Bezons Quai Voltaire in Bezons 6 kms from La Défense » New Group Headquarters : 55,000 square meters for 4,500 staff » Five locations in the Paris area to be closed during the first semester 2010: EUR -36 M of remaining lease obligation fully financed by the new landlord through
Slide 32: Cash flow statement
Cash flow statement In € Million FY 2009 FY 2008 OMDA (*) 501 477 Net capital Expenditures (198) (234) Change in working capital 35 (86) Cash from Operations 338 157 Taxes paid (40) (50) Net costs of financial debt paid (13) (29) Restructuring and rationalisation (135) (103) UK pensions Plan amendme
Slide 33: Net debt evolution (in M€)
Net debt evolution (in M€) Operating Cash Net debt as of Operating Cash Equity portion Net Debt as of Flow 08 Dec. 08 Flow 09 of conv. bonds Dec. 09 -139 48 -304 117 -52 33 Atos Origin FY 2009 / Feb. 17, 2010
Slide 34: Simplified Balance Sheet
Simplified Balance Sheet 31 Dec 31 Dec In € Million 2009 2008 Goodwill 1 508 1 511 Intangible assets 69 78 Tangible assets 407 454 Non-current financial assets 139 69 Net deferred tax assets 147 139 Non-current assets 2 269 2 250 Working Capital 9 14 Shareholders Equity 1 644 1 531 Equity of minorit
Slide 35: Credit lines of EUR 1.1 bn until May 2012
Credit lines of EUR 1.1 bn until May 2012 » Atos Origin well below banking covenants: end 2009 end 2008 covenant » Leverage ratio 0.28 0.64 < 2.5 (net debt / OMDA) » Interest cover ratio (operating margin / 21.48 9.3 >4 net cost of financial debt) 35 Atos Origin FY 2009 / Feb. 17, 2010
Slide 36: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’09 Results » 3. Reinventing Atos Origin » Vision » 4. Objectives for 2010 36 Atos Origin FY 2009 / Feb. 17, 2010
Slide 37: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 37 Atos Origin FY 20
Slide 38: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 38 Atos Origin FY 20
Slide 39: TOP Program is accelerating
TOP Program is accelerating 2009 2010 2011 Non-personnel Standard of living Full effect of ’09 Full effect of ’10 and 2nd expenses and Consolidation Global purchasing on pass at early levers cash Cash collection all categories (e.g., rent & lease) Activity value Full effect of 09. Full effect of 09-
Slide 40: 2009 costs analysis vs 2008
2009 costs analysis vs 2008 » Significant costs base adaptation 2009 2008 Personnel Direct -46M€ -2% 2 418 1 078 2 464 984 -8% Subco Direct T&M -190M€ -28% and FP Personnel Indirect -37M€ -7% Costs of good sold Non personnel -93M€ -9% expenses 502 465 Non cash items 488 678 Non personnel expenses 30
Slide 41: Lean Management: a set of techniques for rapid step-change
Lean Management: a set of techniques that generate rapid step- change in quality, efficiency and employee well being at work • Core principle: focus on value for the customer by eliminating waste, Definition variability and inflexibility • Lean Management applies to all Service Lines. AO is industry
Slide 42: TOP Sales initiatives to reach Sales performance targets
REMINDER 5 TOP Sales initiatives to reach Sales performance targets TS 4: TS 3: Marketing Define process and New account Define and adapt tools package offers development methodology tested and to be roll out over TS2: all accounts. TS 2: Account Accountdevelopment developmentmethodology methodology
Slide 43: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 43 Atos Origin FY 20
Slide 44: Atos Origin's new Group operational model in 2009
Atos Origin’s new Group operational model in 2009 A fully integrated company leveraging on its scale and strengths CEO CEO Global Sales & Markets Strategic International Clients (SIC) GBU GBU GBU GBU GBU GBU GBU GCE France Benelux UK ISAM AWL ROW EMA High Technology Transactional Services (HTTS) Glo
Slide 45: From …
From … GBU GBU Heads Heads Systems Managed Consulting Integration Operations 45 Atos Origin FY 2009 / Feb. 17, 2010
Slide 46: .. to new Market driven organisation in 2010
.. to new Market driven organisation in 2010 GBU GBU Heads Heads Public Financial Manuf./Retail Energy/ Telco Sector Services Utilities Consulting Systems Integration Managed Services HTTS 46 Atos Origin FY 2009 / Feb. 17, 2010
Slide 47: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 47 Atos Origin FY 20
Slide 48: HTTS 2009 Revenues = EUR 879 M
High Tech Transactional Services Building on Atos Worldline strong leading position in 3 business lines Electronic e-CS e-CS Electronic Financial Payments Customer, Customer, Citizen Citizen & & Financial Markets Markets Payments e-Community e-Community Services Services 62% 27% 11% HTTS 2009 Revenu
Slide 49: A further way to deliver IT value to our customers
High Tech Transactional Services A further way to deliver IT value to our customers Shared commitment to success Client business metrics price structure Build once, reuse, sell many times Processing in own mutualised data centers Full control on IPR 49 Atos Origin FY 2009 / Feb. 17, 2010
Slide 50: 2008-2013: ambition to double HTTS revenues organically
High Tech Transactional Services 2008-2013: ambition to double HTTS revenues organically 1,100 + 500 Group leverage 1,100 879 849 » Electronic payments » e-CS » Financial markets 2008 2009 2013 50 Atos Origin FY 2009 / Feb. 17, 2010
Slide 51: Ambition based on strong assets
High Tech Transactional Services Ambition based on strong assets Atos Worldline Customer portfolio of Relationships and offerings operations in all Atos Origin geographies Growing momentum for transactional based services delivering business outcome 51 Atos Origin FY 2009 / Feb. 17, 2010
Slide 52: Rollout into the Atos Origin Geographies
High Tech Transactional Services Rollout into the Atos Origin Geographies Leveraging the customer base Atos Worldline countries Priority countries to leverage Opportunity & 2nd wave 52 Atos Origin FY 2009 / Feb. 17, 2010
Slide 53: Strong Assets to Leverage
High Tech Transactional Services Strong Assets to Leverage Electronic » Leading Asian Payment Solutions, across all platforms Payments » Corporate Payment Cards (UK) » Fuel Cards processing & service center (UK, Spain, Asia) » Payments Polling (UK) e-Community » Transport Ticketing & Clearing Servic
Slide 54: 2009: roll-out throughout the group
High Tech Transactional Services 2009: roll-out throughout the group 2009 Priorities Achievements » Set-up HTTS organization & » HTTS teams set-up in all key governance geographies » Strong support team set-up in Atos Worldline to support country development » Specific joint incentive scheme between
Slide 55: A sound portfolio of first leads and opportunities identified
High Tech Transactional Services A sound portfolio of first leads and opportunities identified in all geographies Spain » Hospital management » Fuel Card services » IVR services » Mobile Salesforce management » Loyalty programs UK » Supply Chain Financing » Mobile Applications » Remote Payments » Bu
Slide 56: Roadmap over next 4 years
High Tech Transactional Services Roadmap over next 4 years » Order entry » Revenue generation » Leverage sales » Investment in » Solid delivery of new momentum business development business » Control delivery » Prepare delivery » Push new offerings execution » Further geographies » Cross-fertilize 5
Slide 57: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 57 Atos Origin FY 20
Slide 58: Vision
Vision » In 2010 post crisis environment, our clients are facing 4 major ruptures Technology Social • Virtualization and cloud • Hyper connectivity technologies • Virtual communities • Smartphones • Sustainable development • Information management • Pay per use Economic Financial • Shift in economic
Slide 59: Reinventing our clients' growth model
Reinventing our clients’ growth model The Group is well positioned on the new era of information technology Business Critical Services Objective: to bring customers high added value IT based on Atos Origin market expertise and solutions, for example : HTTS, monitoring in the nuclear, Enterprise Cont
Slide 60: A priority set on innovation / Prestigious awards
A priority set on innovation to develop further offerings and differentiation » A platform of 43,000 engineers in 30 countries » Creation of the Atos Origin Scientific Community New initiatives The Group’s 50 top scientists (8 nationalities) to anticipate the technological developments of the next 2
Slide 61: Next rendez-vous of our innovation roadmap
Next rendez-vous of our innovation roadmap Cloud Computing, Green IT Smart Utilities, » Social » Technology 14 January ECM & Collaboration Context Aware 31 March Computing » Economic Social » Financial Q3 Computing Q4 61 Atos Origin FY 2009 / Feb. 17, 2010
Slide 62: Atos Sphere: a new positioning of Cloud enabler
Atos Sphere™: a new positioning of Cloud enabler A new Atos Sphere™ offer… … answers our clients’ most »A portfolio of Cloud oriented offerings immediate questions »A dedicated brand »What are the benefits of Cloud for my company, and how can I secure them? »Innovative services for our clients »Wher
Slide 63: Ambition Carbon Free: a new Green IT offering
Ambition Carbon Free: a new Green IT offering Atos Origin offers its customers the opportunity to offset the CO2 emissions of their IT activity Green Transformation for IT - Case study showing the transformation of a large chemical company’s SAP system: 1. Energy Annual consumption (MWh) measurement
Slide 64: Reinventing Atos Origin
Reinventing Atos Origin Customers Employees HTTS HTTS Innovation Innovation Group Group re -organization Reinventing re-organization Atos Origin: our Vision Well Wellbeing beingat atWork Work Operational Operational performance performance (Top (TopProgram) Program) Shareholders 64 Atos Origin FY 20
Slide 65: Well being at Work implies employees engagement
Well being at Work … … implies employees engagement » What does well-being involve? Well Being at Work objectives Personal progress »» Imagine Imaginethe thenew newwaywayofof Personal Values working workingusing usingintensively intensivelythe the Development new newtechnologies technologieswhile wh
Slide 66: Well Being at Work: new social projects launched
Well Being at Work 7 new social projects have been launched “Imagine WbW Council” Imagine at work 25 International Talents Projects Objective WbW 1- Working Organization Imagine new working organization within AO (virtual communities, …) WbW 2- Management Reinforce involvement & encourage transforma
Slide 67: Dynamics of the strategy
Dynamics of the strategy 2009 2010 2011 2012 2013 Operating Margin GROUP Objective: 7 to 8%, catching TRANSFORMATION up with competitors Objective: DEPLOYMENT OF HTTS, ENGINE OF X2 GROUP DEVELOPMENT Organically INNOVATION NEW DISTINCTIVE OFFERINGS TOPLINE GROWTH » Supported by targeted acquisitions
Slide 68: Agenda
Agenda » 1. FY’ 2009 Highlights » 2. FY’09 Results » 3. Reinventing Atos Origin » 4. Objectives for 2010 68 Atos Origin FY 2009 / Feb. 17, 2010
Slide 69: Objectives for 2010
Objectives for 2010 » Revenue: 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 » Operating margin: the Group confirms its ambition to improve OM by +50 to +100 basis points compared to 2009 » Cash f
Slide 70: Atos Origin Full Year 2009 Results
Atos Origin Full Year 2009 Results February 17th, 2010 Atos, Atos and fish symbol, Atos Origin and fish symbol, Atos Consulting, and the fish itself are registered trademarks of Atos Origin SA. February 2009 © 2009 Atos Origin. Confidential information owned by Atos Origin, to be used by the recipie