Atossa Therapeutics, Inc.

Thank you for joining us this morning to discuss our full year 2023 results. On the call with me today is Carlo Desaro-Biondo, our group COO, and Jacques-Francois Deprest, our group CFO. And for the agenda today, I will share some key messages related to our accomplishments in 2023, as well as current strategic initiatives underway. Carla will cover in more details our performance bylines of business and regions. And then Jack Francois will go over our financial statement for the year. I'll come back with closing remarks, and then we'll take your Q&As. Before we get started, I want to draw your attention to the disclaimer that you'll find on slide three. And then you see the agenda. So let me move on to review the year. year end and you can see from the slide, we delivered group revenue and operating margin results that were in line with our full year guidance. This is my key messages. Our evident business reported continued growth and increased profitability in an environment where we saw a market softness in the Americas and in Northern Europe, particularly during the second half of the year. For the fiscal 23 tech foundations executed on this transformation plan, which was based, if you recall, on three pillars, refocus, recover, and rebound. And this has translated into a strong improvement in profitability and increased win rates with existing and new customers. Free cash flow for the second half of the year was slightly below our guidance, as we stated previously, and that was primarily due to deal slippage at year end. For the full year, free cash flow was negative 1.1 billion euros, reflecting higher restructuring, separation, and transformation costs, as well as lower working capital actions compared with the prior year. Cash at the end of the year was 2.4 billion euros, including the benefit of working capital actions of 1.8 billion. Last year, our working capital actions were 2.3 billion. 2023 was a pivotal year for Atos. as we successfully executed on our plan to create two distinct operating units in tech foundations and evidence. Each is well positioned to compete and grow in their respective markets. We're now focusing on leveraging the strength of our business offerings in those two businesses through our coordinated go-to-market strategy. We are evaluating strategic alternatives following the end of our negotiation with EPPI for the potential sale of tech foundations and with Airbus for the sale of evident BDS business. Another key message is that we're in discussions with our banks and bondholders on their refinancing plan that will address our debt maturities. Those discussions were progressing with the support of an ad hoc mandataire and the theory which is the Committee Interministerielle de Restructurisation Industrielle of the French Ministry of Finance and Economy. And now those discussions are going to be progressing within the framework of an amicable conciliation procedure. We're targeting a global refinancing agreement by July of this year, and we will present the parameters of our proposed refinancing framework to our creditors the week of April 8th, and we will provide an update to the market around that time. You should know that we have sufficient liquidity to operate our business until a refinancing agreement is reached, and we are working with our financial creditors on an interim financing that will provide additional liquidity cushion for us. And finally, we also received a favorable decision on Trizetto case earlier this month, vacating entirely the compensatory award. Now let me turn to our full year results. On this slide, we're showing our revenue operating margin and free cash flow for fiscal 22 for reference. Next to it, you'll see that guidance for fiscal 23. And in blue, our results for fiscal 23. And as I mentioned earlier, we met our revenue and OM guidance for the year. Group revenue was 10.693 billion euros, up 0.4% organically year-over-year. Operating margin for the group was 467 million euros, or 4.4% of revenue, up 170 basis points compared with the prior year. Both Evident and Tech Foundation delivered results in line with guidance and better than the prior year. Free cash flow for the group was negative 1.2%. 1 billion, roughly, euros slightly below our targets for the year. And free cash flow, as I mentioned, for 23 reflected the higher restructuring separation and transformation costs and lower working capital actions compared with the prior year. Now, as I mentioned, we have two lines of businesses, both we're investing to position them to expand their market leadership and bring unmatched value and innovation to our clients. Evident is a leading global player providing mission-critical IT services. Evident is a 5.1 billion euro business with more than 47,000 employees operating in 45 countries. The business has strong intellectual property with over 2,100 patents and over 50,000 certification in digital, cloud, and next-generation technologies, including Gen AI. 20% of our top 30 clients have relationship with us over 10 years. And we have an average renewal rate of close to 90% and more than 97% of our revenues generated from existing clients. When you look at our key offerings in Evident, they range from transformation, acceleration, smart platforms, cloud migration and operations and sustainability in our digital business. And for BDS, is our offerings in digital security and advanced computing. Underpinning all of these offerings is our Gem AI capability. The key strategic priority for the business are modernizing client applications, delivering digitization at scale, and providing actionable insight to clients through data analytics and artificial intelligence. The business is also a leader in digital security. identity management, threat identification, and protection. And in advanced computing, Evident introduced the first FSKL computer in Europe, and we're introducing GenAI high-performance computing as a service. Now, all these offerings are well-recognized by the industry analyst community, including Gartner, IDC, Everest Group, just to name a few. Turning to Tech Foundation, the business is 5.6 billion euros in size with more than 48,000 employees in operations in 69 countries. The business has a proven track record of serving clients with their mission critical operations, and the business has a balanced offering and geographic mix. The average relationship across the top 170 clients is 10 years, with a 90% renewal rate. And the net promoter score for this business is 20% higher than industry peers. Tech Foundation is a leading IT infrastructure player with key offerings in hybrid cloud, infrastructure, technology advisory, customized services, business platform, and digital workplaces. And our key strategic opportunities and priorities, actually, in that business is to manage clients' workloads in a hybrid cloud environment, transform operations powered by AI, focus on next-generation offerings, and aligning talents on post-generative AI opportunities and maintaining our leadership in helping clients in their sustainability and D&I initiatives. Now, let me turn the call to Carlo, who is going to give you more information on our performance in fiscal 23. Carlo?

Thank you, Paul, and greetings to everyone. I'd like to go into more details about operational results for fiscal 23. Revenue at Eviden was 5.1 billion euros last year, with a 2.9 organic growth. BDS revenue growth reached mid-single digits, driven by digital security and by significant contracts in high-performance computing, in particular in Europe and in India. With two of the highest-performance computers in the top 10 globally, Chineca and Barcelona, Eviden is now the number one provider of HPC in Europe, India, and South America, and number two worldwide in high-end critical and in-memory computing on-premises or in the cloud. This technology is absolutely key at a time where GNI opportunities are arising everywhere. Our digital business line showed growth, strong revenue growth in Europe, driven by demand for specialized application development, application management, and next-generation products and services. However, America has shown softness in H2 in big, complex projects due to a general market slowdown in the U.S. as clients take longer to reward new business. Turning now to profitability, our operating margin in Eviden was $2.94 million euros last year, representing 5.8% of revenue and a plus 110 basis points improvement over 2022. There was also a sequential improvement through 2023, with operating margin reaching 6.3 in the second half. We are benefiting from cost take-out actions, better utilization of biddable resources, and higher absorption of fixed costs in advanced computing. While driving growth and profitability, we have continued to invest in our product design, in particular in GNI-related solutions and cloud frameworks. As an example, we are embedding GNI in our solutions, which is allowing us to deliver greater savings to our clients. And our centers in India are continuing the developments of that solution with success. To go now to book-to-bill in Eviden, our book-to-bill was 94% for the year, with the Q4 landing just at 100%. On the pipeline development in Eviden, I want to call out a couple of elements. First one, we are increasing our focus on smaller projects in order to translate into faster time to revenue. We've been very careful in qualifying opportunities better and solutioning life's complex project to reduce the risk of execution. Having said that, our win rate for large deals has gone up by 10%. Let me now comment two of our recent wins in Q4. In Spain, we will implement for Canal de Isabel a new commercial system in SaaS mode, as well as the associated support and maintenance. This is a 51 million euro contract over four years for the water distribution in the 6.5 million people living in the Madrid community. All billing, repairs, service requests will be handled by this platform, which will be based on SAP S4 HANA in Microsoft Azure. The other one I would like to bring and to highlight and to bring to your attention, is the very first exascale supercomputer that will be delivered in Europe by Evident BDS to the Jülich Supercomputing Center in Germany. This is a 500 million euros project where Evident will build the first European system able to surpass the threshold of 1 trillion calculations per second. It is a key milestone to ensure Europe's scientific excellence and industrial independence. Jupiter, which is the name of the supercomputer, is designed to tackle the most demanding simulations and compute intensive application in science and industry. For instance, human brain digital twins, most critical climatology research and large AI models training for scientific community. This system is indeed one of the largest AI training machines in the world with more than 23,000 GPU interconnected. And very important, we will also provide the dedicated data centers through our innovative modular data center architecture MDC to deliver exascale machines through eco-friendly containers.

Let me now turn out to Tech Foundation.