France’s Atos cuts financial targets but says restructuring still on track

PARIS :French IT firm Atos on Monday said it would have less cash at hand over the next few years as sales are being dragged down by a weaker business environment, but added this would not impact the key terms of its financial restructuring plan.
Atos – once seen as one of Europe’s champions in the software and technology sector – has been teetering on the brink of financial collapse in recent months, although it secured a crucial restructuring deal with banks and bondholders in June.
Atos said it now forecast a full-year 2024 group revenue of 9.7 billion euros ($10.72 billion), down from 9.8 billion euros previously estimated. The company added it still saw positive, but somewhat lower, cash generation in 2026.
The group’s operating margin will come in at 2.4 per cent of revenue this year, down from 2.9 per cent previously targeted.
The company’s leverage ratio is also now expected to come below a multiple of 2.0 during 2027, later than a previous end-2026 deadline, and Atos also lowered its 2027 revenue and operating margin targets.
A court hearing for the approval of the accelerated safeguard plan will take place on October 15, Atos said.
Atos’ restructuring plan, which is expected to result in massive dilution of existing shareholders, is set to be implemented following the court approval, with several capital increases and debt issuance planned from November 2024 until January 2025.
The company last month posted a wider first-half operating loss, citing impairment charges and lower sales in the Americas and a slowdown in public-sector orders in Europe.
($1 = 0.9048 euros)