2016 annual results

BezonsFebruary 22, 2017

Disclaimer▶ This document contains forward-looking statements that involve risks and uncertainties, including references, concerning the Group's expected
growth and profitability in the future which may significantly impact the expected performance indicated in the forward-looking statements. Theserisks and uncertainties are linked to factors out of the control of the Company and not precisely estimated, such as market conditions or competitors
behaviors. Any forward-looking statements made in this document are statements about Atos’ beliefs and expectations and should be evaluated assuch. Forward-looking statements include statements that may relate to Atos’ plans, objectives, strategies, goals, future events, future revenues orsynergies, or performance, and other information that is not historical information. Actual events or results may differ from those described in thisdocument due to a number of risks and uncertainties that are described within the 2015 Registration Document filed with the Autorité des Marchés
Financiers (AMF) on April 7, 2016 under the registration number: D.16-0300 and its update filed with the Autorité des Marchés Financiers (AMF) on
August 4, 2016 under the registration number: D.16-0300-A01. Atos does not undertake, and specifically disclaims, any obligation or responsibility
to update or amend any of the information above except as otherwise required by law. This document does not contain or constitute an offer of Atos’shares for sale or an invitation or inducement to invest in Atos’ shares in France, the United States of America or any other jurisdiction.
▶ Revenue organic growth is presented at constant scope and exchange rates. Operating margin is presented excluding the amortization of equity
based compensation plans and free cash flow is presented excluding proceeds from equity based compensation.
▶ Business Units include North America (NAM: USA, Canada, and Mexico), Germany, United-Kingdom & Ireland, France, Benelux & The
Nordics (BTN: Belgium, Denmark, Estonia, Finland, Luxembourg, the Netherlands, and Sweden), Worldline, and Other Business Units including
Central & Eastern Europe (CEE: Austria, Bulgaria, Croatia, Czech Republic, Greece, Hungary, Italy, Lithuania, Poland, Romania, Russia, Serbia,
Slovakia, Switzerland, and Turkey), Iberia (Spain and Portugal), Asia-Pacific (APAC: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia,
New Zealand, Philippines, Singapore, Taiwan, and Thailand), South America (SAM: Argentina, Brazil, Colombia, and Uruguay), Middle East & Africa(MEA: Algeria, Benin, Burkina Faso, Egypt, Gabon, Ivory Coast, Kingdom of Saudi Arabia, Lebanon, Madagascar, Mali, Mauritius, Morocco, Qatar,
Senegal, South Africa, Tunisia, and UAE), Major Events, and Cloud & Enterprise Software.
▶ Atos decided, as early as upon its acquisition, to retain only a part of the Unify business. As a result, the Software & Platforms business, along withthe customers and the countries that were planned to be managed through indirect channels, have been accounted for as discontinued operations
since they are in the process of being disposed. Therefore, as Atos is well engaged in the disposal process for the Unify business it has decided todivest, financial KPIs presented in this document reflect only the business of Unify it will ultimately retain, unless otherwise expressly stated. The
forward looking statement regarding the Unify business to be potentially disposed of is also provided separately. In the event that the disposal is notconcluded at the latest at the release of H1 results, the business to be potentially disposed of will thereafter be integrated and reflected in the KPIs.

2 | Atos – 2016 annual results

Agenda1.2016 key figures, strategy update, and objectives
2.Commercial activity

3.Operational & financial performance
4.Conclusion and Q&A
3 | Atos – 2016 annual results

2016 key figures, strategy
update & objectives
Thierry Breton
Chairman & CEO2016 key figures (1/2)

Revenue

Organic growthOrder entry€11.7bn+1.8%€13.0bn+1.9% in Q4+16% year-on-year

Book to bill

Operating margin

Operating margin rate

+20% year-on-year+110bps at constant scopeand exchange rates+13% at constant exchange rates

111%

vs. 105% in 2015

5 | Atos – 2016 annual results€1,104m

9.4%

2016 key figures (2/2)

Net income Group share

Basic Earnings Per ShareTotal number of employees*+40% year-on-year+36% year-on-year+10% year-on-year

Free cash flow

OM conversion to FCF+47% year-on-year

vs. 43% in 2015

€567m

€579m

6 | Atos – 2016 annual results

€5.47

52.5%

100,096
Net cash position€481m

Intact capability to financefuture developments* Including Unify Software & Platforms discontinued operations

2016 objectives over-achieved
Initial objectives(February)▶ Revenue:

Raised objectives(July)

Achievements

Improve organic growthcompared to 2015 (i.e. +0.4%)+1.5% to +2.0%+1.8%

Growth at constant exchange
rates above +8%

above +12%+13%

9.2% to 9.5%

9.4%

Above € 550 million€ 579 million▶ Operating margin:
Between 9.0% and 9.5% ofrevenue▶ Free cash flow:
Circa € 550 million

Dividend of € 1.60 per share proposed to the next AGM+45% compared to prior year and x2 compared to 2014
7 | Atos – 2016 annual results

Atos position in the new global environment (1/3)
New economic environment• GDP growth improvement expected in Continental Europe• Atos became a “Societas Europaea” (European Company) in 2012 and Atos CEO
is the Chairman of the Association of European Companies (ASEP)• Atos not exposed to medium term interest rates increase• Atos positioned to seize increase to 2% of European GDP in Defense andCybersecurity. Atos CTO chairman of ECSO (European Cyber Security Org.)• Atos CEO co-chaired with SAP’s CEO the European Cloud Partnership• Positive forecasts on GDP growth• Corporate tax relief• Large US clients served by US teams: 2013: 3,700 US staff  2016: 8,400 US staff• Atos CEO member of the US “Business Council”• Expected GDP growth slowdown: Atos protected by multi-year contracts
business model• Brexit expected to last >2 years: low exposure to discretionary expenses andFinancial Services and naturally hedged to GBP evolution• Large public investment program expected: Atos long term partner of the
public/defense sector
8 | Atos – 2016 annual results

Atos position in the new global environment (2/3)
New currency and border control environment
Currencies
Currency fluctuations

Visas
Potential H1B and L1 visas
restrictions

Border tax
Potential raise of aborder tax

Naturally hedged as webuilt a delivery model withmost of our costs
generated in the countriesof our clients

Atos in the US focused so far on
Infrastructure & Data Management
and Digital Transformation Factory-Costs from India: lessthan 4% of US revenue-Costs from Mexico: lessthan 2% of US revenue-Costs from thePhilippines: less than 2%of US revenue

Large US clients of Atos are servedby US teams:
2016 US staff: 8,400- of which 151 under H1B- of which 154 under L1

Potential visa holder costs and border tax on offshored work
(US and UK) would materially increase the Atos competitiveness
9 | Atos – 2016 annual results

Atos position in the new global environment (3/3)
New technological breakthroughs
Atos end-to-end offerings perfectly
answering client needs
Atos has built the perfect platform
for IT digitization

Atos Digital Transformation Factory c. 40% of 2019 revenue
Winning market shares with our allies

10 | Atos – 2016 annual results

A Group built
year after year to reap the high growth of thedigital transformation wave with strong
visibility and resilience
A unique fully end-to-end digitaltransformation model to generate organic
growth while providing significant cost
reduction and productivity increase to ourclients
A technology and partnership focus on
cybersecurity and cognitive computing(Codex), a brand new landscape of growth forour clients

Access to multi-billion yearly R&D spending through an
extensive and advanced network of partners

11 | Atos – 2016 annual results

The Digital Transformation Factory leadershipprogram
Improved training effort(In thousands of trainings hours)

x2
x2

2,500

1,200

Digital transformation certification training(In thousands of certified people)

27
Cloud
SAP HANA
Digital Workplace
Codex
Others

13

21

4
8

12

16

11

540

12

2013

2016

12 | Atos – 2016 annual results

2019e

2016

10

8

2017e

64

2018e

2019e

3-yearplan

33

2017 objectives: Significant further
improvements towards 2019 Ambition▶ Revenue growth: Circa +6% at constant exchange rates, above +2%
organically.
▶ Operating margin: Between 9.5% and 10.0% of revenue.
▶ Free cash flow: Operating margin conversion rate to free cash flow at
between 55% and 58%.

13 | Atos – 2016 annual results

Commercial
activity
Patrick Adiba

Chief Commercial Officer

Commercial activity dashboard
Order entry

Book to bill ratio€13.0bn111%+16% year-on-year

119% in Q4

Backlog

Qualified pipeline€21.4bn€6.5bn

1.8 years of revenue

6.4 months of revenue

15 | Atos – 2016 annual results

An accelerating trend of revenue organic growth
driven by the Group commercial dynamism
Statutory revenue (€m)
Organic evolution %

3 200

2 700

2 200

Phase 1 of new
business model
3 244

Sales reorganization
Integration andrestructuring
2 064

2 113

2 427

2 940

2 514
+1.6%

+0.2%

2 777

2 757

2 209
+0.1%

1 700

4,0%

3 036

2 708

2 666

+0.3%

+0.5%

+1.8%

+1.8%

1.9%

+0.4%

-2.0%

Q1
2014

Q2
2014

+2%
3,0%
to
+3%
2,0%
organic
1,0%
growth
0,0%
-1,0%

-0,9%
-1.8%

Phase 2

-2,0%

1 200

-3,0%

Q3
2014

16 | Atos – 2016 annual results

Q4
2014

Q1
2015

Q2
2015

Q3
2015

Q4
2015

Q1
2016

Q2
2016

Q3
2016

Q4
2016

2016 revenue performance by market

Telcos, Media& Utilities

In € million
Manufacturing, Retail & Transportation
Public & HealthTelcos, Media & Utilities
Financial Services
TOTAL GROUP* At constant scope and exchange rates

17 | Atos – 2016 annual results% organic
growth
+0.6%
+3.8%
+2.1%
+0.4%
+1.8%

20%

28%

Public& Health

Financial
Services
17%

35%

Manufacturing,
Retail &Transportation

Why do we win when leveraging Atos Digital
Transformation factory ?
End-to-end digital transformation on time, at specs, at cost

1. Legacy infrastructure to cloud transformation and cloud orchestration
2. Application cloudification, migration and maintenance
3. Enterprise processes to cloud transformation with best in class SAP HANAbullion appliance
4. Data value creation with cognitive and analytics in Atos Codex
5. Addition of cloud mobility and collaboration platform for connected workforce
with Circuit and unified communications
6. End-to-end security of platforms, data and users
7. Monetization of new cloud enabled services with Worldline

18 | Atos – 2016 annual results

Phase 2 organic growth leveraging Atos
Digital Transformation Factory
Phase 1 of new
business model (+1% to +2%)
Go-tomarket

Focus on TOP 200 accounts

Customer
Net Promoter Score: 50%
satisfaction
Sales

management

19 | Atos – 2016 annual results

2016: revenue organic
growth in all markets

Phase 2(+2% to +3%)

“Account plan as a contract”
extended to 80% of total
revenue
Net Promoter Score: 54%

coverage extended to 80% of total
revenue

Sales efficiency improvement:
incentives, skilling, new tools

Main Q4 wins leveraging Atos Digital Transformation
factory
1. Cloudtransformation

North American
chemicals group

2. Application
cloudification
Global industry
conglomerate

3. SAP HANA-bullion
appliance

4. Atos Codex
5. Collaboration andUC
6. End-to-end security
7. Monetization

20 | Atos – 2016 annual results

Europeansavings andinvestmentsbankEuropean utility
infrastructure
operator

World classpublic institution

Operational & financial
performance
Elie Girard
Group CFO

Constant scope and exchange rates figures
reconciliation
In € million
Statutory revenue
Exchange rates effect2016
11,7172015
10,686-295% change+9.7%

Revenue at constant exchange rates

11,717

10,390+12.8%

11,717

1,128-4
11,515+1.8%

Scope effectExchange rates effect on acquired/disposed perimeters
Revenue at constant scope and exchange rates

Statutory operating margin
1,104
883.7
+24.9%
Equity based compensation reclassification
33.3
Scope effect73.3
Exchange rates effect-31.3
Operating margin at constant scope and exchange rates
1,104
959.0
+15.1%
as % of revenue
9.4%
8.3%
▶ Scope effect mainly related to Xerox ITO, Unify, Equens, Paysquare, Komerçni Banka Smartpay, andAnthelio▶ Exchange rates effect mainly coming from the British pound
22 | Atos – 2016 annual results

2016 performance by Division▶ Positive growth reached every quarter of the year for each of the divisions▶ Strong margin improvement, €+145 million like-for-like, €+178 million excluding
pensions one-off effects

RevenueIn € million
Infrastructure & Data Management
Business & Platform Solutions
Big Data & Cybersecurity
Corporate costs
Worldline
TOTAL GROUP* At constant scope and exchange rates

23 | Atos – 2016 annual results

Operating margin

2016
6,595
3,194
666

2015*
6,539
3,169
591

% organic
+0.9%
+0.8%
+12.8%

1,261
11,717

1,216
11,515

+3.7%
+1.8%

2016
682.9
206.1
111.9
-93.9
196.9
1,104

2015*
555.5
199.1
102.1
-71.1
173.4
959.0

Operating m argin %
2016
10.4%
6.5%
16.8%
-0.9%
15.6%
9.4%

2015*
8.5%
6.3%
17.3%
-0.7%
14.3%
8.3%

Infrastructure & Data Management▶ Organic growth and operating margin benefittingfrom the transition of Atos customers to hybrid
cloud infrastructures▶ Contribution from the successful execution of
the large Unify restructuring program

North America
14%
30%

7%
8%

United-Kingdom &IrelandGermany
Benelux & The Nordics▶ 46,824 direct staff at the end of 2016

20%

21%

FranceOther countries

In € million

Revenue
Operating margin
Operating margin rate
* At constant scope and exchange rates
24 | Atos – 2016 annual results

2016
6,595
682.9
10.4%

2015*
6,539
555.5
8.5%

% organic+0.9%

Business & Platform Solutions▶ Steady top line improvement quarter after
quarter fueled by Digital Transformation
projects▶ First phase of margin turn-around thanks tobetter project and workforce management

France27%

31%

Benelux & The Nordics▶ 32,577 direct staff at the end of 2016

18%

11%
13%

In € million

Revenue
Operating margin
Operating margin rate
* At constant scope and exchange rates
25 | Atos – 2016 annual results

2016
3,194
206.1
6.5%

Germany

2015*
3,169
199.1
6.3%

United-Kingdom &Ireland
Other countries% organic+0.8%

Industrializing Application Services
Cloud Apps Build &DeployApps Mgt. Services
Multi-Supplier Integr.

Atos Cloud
Foundry

RedHatOpenshift

Atos Canopy
ComposeSAP HANATransformation

SAP HANA DB
SAP S4 Hana

HybrisDigital Workplace
CustomerExperience

Microsoft
O365

PEGA

Atos Codex
Analytics
Internet of Things
Industry 4.0

Unify
OpenscapeOrganization

Processes & tools

Multiple teams around the globe

Multiple systems

Global “tower” approach

Vertical solutions
Transversal features(Automation, Robotics,
Enterprise Platform)

Single system

Savings
Delayering
10%Overhead

14%

FinanceResource management

Project margin tracking

Reactive staffing at signature

Non billable HC focus

Proactive staffing & training

26 | Atos – 2016 annual results

23%

Automation

Offshore
28%

25%

Rightsizing

Big Data & Cybersecurity▶ High revenue and operating margin growth led
by a strong demand for state of the art
solutions– Business expansion in new geographies– Increasing contribution from the private sector▶ 3,726 direct staff at the end of 2016

FranceGermany

20%

5%
5%
5%
11%

55%

United-Kingdom &Ireland
North America
Benelux & The Nordics
Other countries

In € million

Revenue
Operating margin
Operating margin rate
* At constant scope and exchange rates
27 | Atos – 2016 annual results

2016
666
111.9
16.8%

2015*
591
102.1
17.3%

% organic+12.8%

Worldline▶ Sustained dynamics of payment businesses▶ Compensation for two contracts terminated▶ 8,132 direct staff at the end of 2016 of whichcirca 1,200 from acquisitions

France

13%
6%

32%

Benelux
Germany & CEE

9%United-Kingdom

9%30%

Asia & India
Other countries

In € million

Revenue
Operating margin
Operating margin rate
* At constant scope and exchange rates
28 | Atos – 2016 annual results

2016
1,261
196.9
15.6%

2015*
1,216
173.4
14.3%

% organic+3.7%

2016 performance by Business Unit▶
▶
▶
▶

Germany recovery plan strongly materializing
North America, Worldline, and France fueling revenue growth
UK & Ireland growing 4.5% in H2
Strong operating margin improvement in most of the geographies
RevenueIn € million
North America
Germany
United-Kingdom & Ireland
FranceBenelux & The Nordics
Other Business Units
Global structures**
Worldline
TOTAL GROUP

Operating margin

2016
2,061
1,954
1,790
1,709
986
1,956

2015*
1,972
1,856
1,797
1,671
1,064
1,938

% organic
+4.5%
+5.3%
-0.4%
+2.3%
-7.3%
+0.9%

1,261
11,717

1,216
11,515

+3.7%
+1.8%

2016
240.8
200.9
238.8
125.4
71.5
127.3
-97.7
196.9
1,104

2015*
182.9
138.7
196.7
102.9
98.4
139.4
-73.3
173.4
959.0

Operating m argin %
2016
11.7%
10.3%
13.3%
7.3%
7.3%
6.5%
-0.9%
15.6%
9.4%

* At constant scope and exchange rates** Global structures include the Global Divisions costs not allocated to the Group Business Units and Corporate costs

29 | Atos – 2016 annual results

2015*
9.3%
7.5%
10.9%
6.2%
9.2%
7.2%
-0.7%
14.3%
8.3%

Unify cost synergies and savings generation above
initial expectations
Cost base evolution (in € million)-29%(-1,098 headcounts)
471
336

-12%

-43%
233

81

-23%
47

2015
2016
Personnel
expenses2015
2016
IT costs

35

27

2015
2016
Real estate

2015
2016
Other non-personnel
costs

2016 net income of Unify Software & Platforms*: € 11.7 million
In line with the objective set at the time of the acquisition
Confirming the € 100 million 2017 EBITDA target and supporting valuation
30 | Atos – 2016 annual results* Discontinued operations

2042016 headcount evolution

17,606

16,963100,096

8,131
91,322

Headcount a s of
31/12/15

31 | Atos – 2016 annual results

Scope

HiringLeave rs,
restructuring& dismi ssals

Headcount a s of
31/12/16

Income statement
In € million

2016

2015

% yoy

Revenue

11,717

10,686+10%

Operating margin% of revenue

1,104
9.4%

917
8.6%

+20%

-167
-50
-96
22

-190
-33
-72
-33

813

589

-49

-45

764

544

-145
-19.0%
1-110-20.2%
3620

437

Non-controlling interests

53

31

Net income Group share

567

406

Reorganization, Rationalisation, Integration & acquisition costs
Equity based compensation
Amortization of intangible assets (PPA from acquisitions)
OthersOperating income
Net financial expenses
Profit before tax
Tax charge
Effective tax rate
Share of net profit of associates
Net income

32 | Atos – 2016 annual results

+38%
+40%

+42%

+40%

Net Income and EPS Group share evolution

Net income Group share

Basic EPS Group share (in € per share)

Visa share

Diluted EPS Group share (in € per share)

x2

5.47

567
36

4.01

531

406
2.67

265

2014

2015

33 | Atos – 2016 annual results

5.44

2016

3.98

2.64

2014

2015

2016

Cash flow statement
In € million

2016

2015

OMDA

1,375

1,200

Capital Expenditures
Change in working capital requirement
Cash from operations

-421
-38
915

-441
49
808

Reorganisation, Rationalisation & Integration
Taxes paid
Net cost of financial debt paid
Other changes
Free cash flow

-149
-129
-18
-40
579

-238
-106
-17
-54
393

Net (acquisitions) / disposals
Capital increase
Visa share
Dividends paid to the owners of the parent
Change in net cash
Impact of foreign exchange rate fluctuation

-707
28
36
-47
-111
0

-860
58
-31
-439
43

Opening net cash / debt

593

989

Closing net cash

481

593

34 | Atos – 2016 annual results

700

Free cash flow
Free cash flow / Operating margin

8.5%

600

579
7.5%

500

400

6.5%

393
300

293

52.5%

5.5%

200

4.5%
100

40%

43%

0

3.5%

2014

2015

2016

Net cash evolution

+579

-707

+28

593

Net cash
31/12/15

Free cash fl ow

35 | Atos – 2016 annual results

Net
Acquisitions /Disposals

Capitalincrease+36

Visa sha re

-47

0

481

Dividend
paid

Transl ationdiffere nces
effectNet cash
31/12/16

Simplified balance sheet
31 December 2016
€ 13.4 billion
31 December 2015
€ 10.7 billion
Goodwill:
3.12
Non-current
assets: 2.44

Shareholders’equity: 4.10
Other non-current
liabilities: 1.30
Gross debt: 1.35

Current
assets: 3.17

Goodwill:
3.86

Non-current
assets: 2.63

Other non-current
liabilities: 1.63
Gross debt: 1.64

Current
assets: 3.73
Assets held for sale:
1.01

Cash: 1.95

Other current
liabilities:
3.93

AssetsLiabilities

Assets36 | Atos – 2016 annual results

Shareholders’equity: 4.84

Cash: 2.12

Liabilities held forsale: 0.85

Other current
liabilities:
4.39
Liabilities▶ Shareholder equity+18%▶ Gross debt
including €600m
straight bond and€300m Euro PP▶ Net pension
provision: €1.25bn(c. 75% without funding
obligations) Solid financial
structure Capacity forfurtherdevelopment

2016 to 2017 operating margin: forecasted
evolution
9.5%
to
10.0%
9.4%

9.2%
-15bps

2016

-5bps

12 month
FX effect as ofscope effect end of January

37 | Atos – 2016 annual results2016 pro
forma

+5bps

+30bpsBig Data &Cybersecurity

Worldline+25bps-35bps+30bpsPensions
one-off

Infrastructure& DataManagement

Business &Platform
Solutions2017e2016 to 2017 free cash flow: forecasted evolution
+20

-30

+25

-20

+40

-15

-15

+90
+10

55%
to
58%
OM
conversion
to FCF

579
52.5%
OM
conversion
to FCF

2016

Additional
2016 FCF
fromacquisitions(pro forma)

2017
operatingmarginincrease

38 | Atos – 2016 annual results

Pensions
Project
Capex
Restructuring
Equensone-offs
managementnetdecrease
integration
replacement improvementofby cashdepreciations
marginTax

Others2017e

Conclusion
and Q&A

Thierry Breton
Chairman & CEO

Take-aways and main priorities in 2017
Benefiting from the new world environment
thanks to our technologic / geographic / business mix

Atos Digital Transformation Factory four our customers
increasing the IT spending to digital
Accelerate catch-up in Business & Platform Solutions

Pursue acquisition strategy creating value for ourshareholders with financial discipline
Status on Unify Software & Platforms

 Expected 2017 perfectly in line with 3-year plan objectives
40 | Atos – 2016 annual results

ThanksAtos, the Atos logo, Atos Codex, Atos Consulting, Atos Worldgrid, Worldline, BlueKiwi, Bull, Canopy theOpen Cloud Company, Unify, Yunano, Zero Email, Zero Email Certified and The Zero Email Company are
registered trademarks of the Atos group. April 2016. © 2016 Atos. Confidential information owned by
Atos, to be used by the recipient only. This document, or any part of it, may not be reproduced, copied,circulated and/or distributed nor quoted without prior written approval from Atos.