Atos Cuts Financial Targets but Restructuring Remains on Track

03 Sep, 2024

Atos Cuts Financial Targets but Restructuring Remains on Track

Atos, the French IT firm, announced on Monday that it expects reduced cash flow in the coming years due to a challenging business environment. Despite the downturn, Atos assured that its financial restructuring plan remains on track. Previously a leading name in Europe's software and technology sector, Atos has faced financial difficulties but secured a vital restructuring deal with banks and bondholders in June.

For the full year 2024, Atos now projects group revenue of €9.7 billion ($10.72 billion), a decrease from the earlier estimate of €9.8 billion. The company also revised its operating margin forecast to 2.4% from 2.9%. The anticipated leverage ratio is now expected to fall below 2.0 by 2027, a delay from the previous end-2026 target. Additionally, revenue and operating margin targets for 2027 have been lowered.

A court hearing for the approval of the accelerated safeguard plan is scheduled for October 15. The restructuring plan, which will dilute existing shareholders, involves several capital increases and debt issuance planned from November 2024 to January 2025. The company reported a wider first-half operating loss last month, impacted by impairment charges and a slowdown in sales and orders.