By Mathieu Rosemain
PARIS (Reuters) -France’s Atos said on Wednesday its sales returned to growth in the third quarter, beating expectations as the loss-making IT consulting firm strives to regain markets’ trust by carrying out a costly split-up plan.
The group, whose stock price has tumbled 80% over the last 12 months, said it expected the positive momentum to continue in the fourth quarter, in part because some bookings were delayed. It also finalised financing for the separation of the group.
Revenue for the three months ended Sept. 30 rose 1.1% at constant currencies from a year earlier to 2.82 billion euros ($2.81 billion).
That beat the median of 12 analyst estimates compiled by the company, which predicted a fall of 0.4% at constant currencies.
Atos confirmed its full-year targets, adding it now expected revenue growth at constant currencies to be in the “upper half” of the -0.5% to 1.5% range.
The group said its “book-to-bill” ratio, which helps investors evaluate the outlook for tech companies, was 71% in the third quarter, indicating weak demand as fewer orders were received than filled over the period.
Atos’ management said it expected a significant improvement in this indicator in the fourth quarter.
“We’ve had delays in major contracts that will materialize in the fourth quarter,” co-chief executive officer Philippe Oliva told reporters in a call.
Atos also said the split-up plan, which includes spinning off and combining its most lucrative assets such as cybersecurity division BDS, was on track, with completion expected in second half of 2023.
The turnaround plan is set to cost about 1.6 billion euros, 44% financed by the sale of non-core assets. Atos is still looking for buyers for 480 million euros worth of assets.
($1 = 1.0045 euros)
(Reporting by Mathieu Rosemain; Editing by Jacqueline Wong and Mark Potter)
