For the three months to the end of September, Atos reported sales of 1.4bn euros ($2.1bn), up from 1.3bn euros ($1.9bn) in the same period the previous year and including organic growth of 6.6%. According to CEO Philippe Germond, the company is on course to achieve its goal of 4% organic sales growth in 2007.
Crucially for Atos, its UK operation, which has struggled in recent quarters, looks to be on the road to recovery. Sales grew 10.8% in the third quarter to 261m euros ($381.8m), as the company began to see returns on big deals signed in the second half of last year with clients such as NFU Mutual and the Department for Constitutional Affairs.
The main objectives for the UK business were to get back into profit, to increase sales and to fix four problem contracts, Keith Wilman, UK CEO at Atos since January this year, told Computer Business Review. We can show that we have put a tick in all three boxes. It’s fair to say that the UK is ahead of where it was expected to be.
We set about getting rid of the perception within the market that Atos had three distinct lines of service: consulting, systems integration and infrastructure, said Wilman. We have got lines of service going across and we now turn up to meet customers with an end-to-end proposition.
Elsewhere in the results announcement, Atos’s managed operations business area, which provides system design and installation as well as application, data center, and network management, increased quarterly sales by 20.2% to 790m euros ($1.2bn), with organic growth of 10.3%. The performance of the systems integration business was solid if unspectacular, with sales up 5% to 549m euros ($803.1m).
The company’s consulting business continues to disappoint, however. Third-quarter sales slipped 18.5% to 79m euros ($115.6m), while in the first nine months of the year consulting revenue is down 11.6% at 268m euros ($392m). Atos said its performance in France and the Netherlands had been hit by high staff attrition and low utilization rates, while the UK had seen order levels fall below expectations.
In an effort to deal with these problems, it said it had brought in new management for the consulting business in both France and the UK over the last six months and these teams, along with the heads of the Dutch operation, were in the process of setting up a series of standardized consulting practices and offers.
In a conference call to discuss the results, Germond said that Atos was in talks with stock exchange operator NYSE Euronext over the future of the joint venture Atos Euronext Market Solutions. While he did not go into detail about the content of those discussions, he did say that they covered the future of the NYSE Euronext software systems, and he admitted that the sale of Atos’ stake in the business was one option under review.
