Atos Se · EURONEXT:ATO
Atos — Debt Investor Presentation (June 2015)
41 slides from Atos's debt investor presentation, June 2015
Slide 1: Bond investor presentation
Bond investor presentation June 2015 - Strictly private and highly confidential
Slide 2: Disclaimers
Disclaimers Bond investors presentation June 2015 ▶ This document does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction. ▶ This document has been prepared for the sole purpose of th
Slide 3: Atos key strengths
Bond investors Atos key strengths presentation June 2015 1 Leading market position in Europe in digital services 2 Ability to serve clients worldwide 3 Strong visibility on future revenue 4 Enhanced offerings, further scaled with Bull and Xerox ITO 5 Track record of M&A value creation and integratio
Slide 4: Agenda
Bond investors Agenda presentation June 2015 1. Atos ID card 2. Business strategy 3. Financial performance 4. Key Credit highlights 5. Q&A session 4
Slide 5: Atos ID card
1 Bond investors presentation June 2015 ATOS ID CARD 5
Slide 6: A strong and experienced Management team
A strong and experienced Management Bond investors presentation team June 2015 Thierry Breton Charles Dehelly Gilles Grapinet Chairman and CEO SEVP SEVP GMC* Member Worldline CEO GMC* Member Charles Dehelly began his career at the Thomson Group where in Gilles Grapinet’s previous roles include in 19
Slide 7: Atos' journey over the last years
Bond investors Atos’ journey over the last 6 years presentation June 2015 in 2008* in 2014* Δ Revenue €5.6bn €9.1bn +65% Operating margin 4.7% 7.8% +310bps Headcount 51,000 86,000 +68% Net cash / (debt) (€304m) €989m +€1,294m Free cash flow (€52m) €367m +€419m Market cap €1.2bn €6.7bn x5.6 * statuto
Slide 8: Atos addresses clients' needs and market trends within sub-groups
Atos addresses clients’ needs and Bond investors presentation market trends within 2 sub-groups June 2015 Managed Services Consulting & Big Data & & BPO Systems Integration Cyber-security ▶ Workplace Services ▶ Consulting & Technology ▶ Data analytics IT ▶ Application Operations Services ▶ High Perf
Slide 9: An integrated global leader in Digital Services
An integrated global leader in Digital Bond investors presentation Services … June 2015 € 9.7 billion 2014 pro forma revenue* Managed Services € 4.6 billion #1 European Consulting & in Europe Systems Integration € 3.1 billion € 1.1 billion Leading service One of Europe’s leading provider 39% provide
Slide 10: …with a diversified income base…
Bond investors …with a diversified income base… presentation June 2015 2014 revenue by geography 2014 revenue by vertical Benelux & The Germany & Nordics Central Europe € 1.4 billion Telcos, Media € 1.6 billion Public & & Utilities Health 15% € 2.0 billion 18% Central & € 2.4 billion Eastern Europe
Slide 11: …and a strong visibility on future revenue
…and a strong visibility on future Bond investors presentation revenue June 2015 Large part of recurring revenue Backlog: Strong visibility deriving from multi-year contracts ▶ Managed Services, Worldline, Application ▶ Full backlog at € 16.2 billion at the end of Management, and Atos Worldgrid mult
Slide 12: Atos presence worldwide
Atos presence worldwide Bond investors Complementary workforce with Xerox ITO expanding Atos presentation footprint in the US June 2015 Xerox ITO’s workforce distribution enhances + Xerox ITO Europe: Atos' offshore strategy 1,080 Benelux & ▶ Circa 50% of Xerox ITO’s the Nordics UK & employees based
Slide 13: A world of global partnerships
A world of global partnerships Bond investors Solid and long-term strategic partnerships with technology presentation leaders June 2015 Atos partnerships ecosystem Create business 1000+ certified experts 5,000+ implementations Improve 1 million end-users supported win-rate 1500+ certified 10,000 exp
Slide 14: Atos and the International Olympic Committee
Atos and the International Olympic Committee Bond investors Trusted IT provider for Olympic Games presentation June 2015 already extended to 2024 14
Slide 15: Business strategy
2 Bond investors presentation June 2015 BUSINESS STRATEGY 15
Slide 16: Atos roadmap from 2014 to 2016
Atos roadmap from 2014 to 2016 Bond investors Goals & levers presentation June 2015 Reinforce growth Global leadership and profitability in Managed in System Services Integration Acquisitions with financial discipline Accelerate Cloud in specific services geographies and development segments 2016 Am
Slide 17: 4 optimized Service Lines…
Bond investors 4 optimized Service Lines… presentation June 2015 Managed Consulting & Big Data & Systems Cyber-Security Worldline Services Integration Offshore trajectory Enhance higher Vertical integration from 33% to >50% of Take advantage of 1 1 1 value services: e.g. on Big Data: 1 staff and con
Slide 18: …to address highly attractive market segments
…to address highly attractive market Bond investors presentation segments June 2015 Significant market opportunity Strong growth prospects Application Cloud Management IT services €41bn Consolidation €50bn €47bn Big Data / Merchant Advanced Services Analytics €30bn Workplace €36bn / BYOD MES/PLM ECM
Slide 19: Recent strategic achievements…
Bond investors Recent strategic achievements… presentation June 2015 May 2014 June 2014 December 2014 Bull acquisition Worldline IPO Xerox ITO acquisition ▶ Successful cash public offer ▶ IPO of Atos’ payments and ▶ $ 950 million plus an for a total consideration of merchants transactional additiona
Slide 20: …matching all the objectives of Ambition 2016 three-year plan
…matching all the objectives of Bond investors presentation Ambition 2016 three-year plan June 2015 Bull Worldline Xerox ITO ▶ Expand Atos foothold in the US ▶ Anchor Atos global leadership in Managed Services ▶ Increasing Cloud position ▶ Reinforce growth and profitability in Systems Inte
Slide 21: 2014 highlights and 2015 priorities
Bond investors 2014 highlights and 2015 priorities presentation June 2015 2014: a year of accelerated transformation ITO Sales Solid financial reorganization structure Top priorities for 2015: 1 2 3 Boost revenue with our clients through Consolidate Strategic innovation, partnerships and develop Ato
Slide 22: Financial performance
3 Bond investors presentation June 2015 FINANCIAL PERFORMANCE 22
Slide 23: Strong and growing FCF generation
Strong and growing FCF generation Bond investors in € million presentation June 2015 ▶ OMDA improvement: €+442 million ▶ WC optimization: €-484 million ▶ CAPEX at 3.9% of revenue 365 367 259 194 143 117 -52 2008 2009 2010 2011 2012 2013 2014 23
Slide 24: From net debt to net cash
From net debt to net cash Bond investors in € million presentation June 2015 ▶ SIS acquisition for € 850 million in cash, shares, and convertible bond ▶ Early redemption of 2009 and 2011 989 convertible bonds (2 x € 250 m) resulting in 905 € 470 million debt converted in equity ▶ Bull acquisition fo
Slide 25: 2014 key figures 1/2
2014 key figures Bond investors presentation 1/2 June 2015 2014 2013 Revenue (€m) 9,051 8,615 Operating margin 7.8% 7.5% (in % and €m) € 702 m € 645 m Free cash flow (€m) 367 365 Net cash (€m) 989 905 Statutory figures 25
Slide 26: 2014 key figures 2/2
2014 key figures Bond investors presentation 2/2 June 2015 2014 2013 Net income (€m) 283 260 Net income Group share (€m) 265 262 Order entry (€m) 9,113 8,790 Book-to-bill 101% 102% Backlog (€bn) 16.2 15.2 Total number of employees 85,865 76,320 Statutory figures 26
Slide 27: Q1: reaching important milestones
Q1: reaching important milestones Bond investors presentation Well on track to achieve 2016 Ambition June 2015 €2,427m Q1 2015 +17.6% year-on-year (+12.2% at constant exchange revenue rates) +0.2% organic growth €2,198m Q1 2015 +26% at constant exchange rates order entry (91% book to bill) Cloud, Bi
Slide 28: Revenue evolution trend by quarter
Bond investors Revenue evolution trend by quarter presentation June 2015 Organic evolution % +0.1% 0.2% 3,000 0.0% 2,800 2,600 -0.1% -0.9% 2,666 2,400 -0.2% -1.8% 2,427 2,200 -2.0% -0.3% 2,000 2,209 2,064 2,113 -0.4% 1,800 1,600 -0.5% 1,400 -0.6% Q1 Q2 Q3 Q4 Q1 2014 2015 Progressive improvement quar
Slide 29: 2015 objectives
Bond investors 2015 objectives presentation June 2015 The Group confirms all its objectives for 2015 as stated in the February 18, 2015 release, i.e.: ▶ Revenue The Group targets a positive organic revenue growth ▶ Operating margin The Group has the objective to improve its operating margin rate tar
Slide 30: Atos 2016 Ambition
Atos 2016 Ambition Bond investors As presented at Atos 2015 Analyst Day – June 18, 2015 presentation June 2015 2013 2016 Revenue €8,615m above €11bn Operating margin €645m 7.5% c. €1.0bn Free cash flow €365m €500m €550m Net cash €905m c. €1,000m 2016 revenue ambition at April 2015 exchange rates 30
Slide 31: Free cash flow evolution
Free cash flow evolution Bond investors (in € million) presentation June 2015 +10 +40 +60 -85 -15 -50 +130 -22 500 to 550 +90 367 FCF 2014 Bull Operating Xerox ITO Provisions Change in Restruct, Tax Stock options Others FCF synergies margin FCF on project working Ratio, & paid exercise 2016 improvem
Slide 32: Ambition to double net income Group share over 2 years
Ambition to double net income Group Bond investors presentation share over 2 years June 2015 2016 2014 Ambition x2 c. €530 million €265 million # of shares*: # of shares*: c. 104m c. 107m * Fully diluted number of shares at year end 32
Slide 33: Main drivers to double net income Group share from 2014 to 2016e
Main drivers to double net income Bond investors presentation Group share from 2014 to 2016e June 2015 ▶ Industrialization programs and cost synergies 35% Profitability improvement ▶ Improved business mix 45% Additional operating 25% ▶ Contribution from acquired companies margin 35% Restructuring co
Slide 34: Key credit highlights
4 Bond investors presentation June 2015 KEY CREDIT HIGHLIGHTS 34
Slide 35: Simplified balance sheet evolution
Simplified balance sheet evolution Bond investors in € million presentation June 2015 31 December 2014 +26% € 9.0 billion 31 December 2013 € 7.2 billion Goodwill: ▶ Shareholder equity 2.63 Shareholder +16% equity: 3.40 Goodwill: ▶ Goodwill +37% 1.92 Shareholder Non-current ▶ Net pension equity: 2.94
Slide 36: Solid liquidity profile
Solid liquidity profile Bond investors in € million presentation June 2015 New Revolving Credit Facility (RCF) November 2014 ▶ Atos substituted its €1,200m RCF by a syndicated RCF of €1,800m 1,620 maturing in November 2019 (extension option until November circa 2021) 1,306 695 1,160 Ample liquidity
Slide 37: Financing discipline
Financing discipline Bond investors Financial agility to support 2016 Ambition while keeping presentation outstanding credit ratios June 2015 Leverage ratio M&A financial criteria Before Xerox ITO acquisition After Xerox ITO acquisition ▶ Stringent assessment Estimated of asset value pro forma Net c
Slide 38: Atos key credit strengths
Bond investors Atos key credit strengths presentation June 2015 1 Leading market position in Europe in digital services 2 Strong visibility on future revenue and high degree of topline recurrence Solid and growing cash flow generation, underpinned by a track-record of value 3 creation through M&A 4
Slide 39: Rationale for a bond issue
Rationale for a bond issue Bond investors A bond issue would perfectly meet all of Atos’ financial presentation policy guidelines June 2015 Diversify Atos’ sources of funding, accessing a new large pool of liquidity Increase duration of financing resources Further enhance the group’s strong li
Slide 40: Questions Answers
5 Bond investors presentation June 2015 From Questions Answers 40
Slide 41: Thank you
Thank you Atos, the Atos logo, Atos Consulting, Atos Worldgrid, Worldline, BlueKiwi, Bull, Canopy the Open Cloud Company, Yunano, Zero Email, Zero Email Certified and The Zero Email Company are registered trademarks of the Atos group. February 2015. © 2015 Atos. Confidential information owned by Ato