Atos SE

Good day and thank you for standing by. Welcome to ADOS Group Q1 2026 performance conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you need to press star 1 and 1 on your telephone. You'll then hear an automatic message advising your hand is raised. Please be advised that today's call is being recorded. I'd now like to hand the conference over to your first speaker today, Mr. Philip Tsao, Group Chairman and CEO. Thank you. Please go ahead, sir.

Thank you very much. Good morning, everybody. I am today with Jacques François, and we're going to talk about Q1. So let's go directly on page six on the business highlights. So first... First point is solid financial performance. I think we are quite happy, let's say, with the start of the year. We always say that's the lowest point of the year, and then we gradually, I would say, improve the growth. Further progress in the execution of the Genesys plan. So the Genesys is doing also very well. We will finish the first Genesys plan probably by mid of this year, and we have extended the plan, I would say, with another savings. to be finished probably by the end of 26. The idea for us, of course, is to have the full savings of the new, I would say, the extended plan in the course for the year 2027. We have a positive business momentum, and I will come back to this, with, I would say, a book to read that is the highest for the last five years. And so now we have a clear focus on our strategic pillars, Agency KI, we have launched a manifesto. Sovereign, we have launched also a manifesto internally, and it's going to be external in the coming weeks. And of course, cyber, where we are number one in Europe. So if we go on the key numbers on page seven, order entry is 1.5 billion. It's 89% for Atos. It's 87% with Eviden. And of course, as you can imagine, with Eviden, the order entry was a little bit low in Q1 with the war. We definitely think that it's going to be much better after, let's say, the war, but we don't know, unfortunately, when it's going to be finished. Revenue is 1.7 billion plus. It's roughly 1640, what we call with the go-forward perimeter. The go-forward, it's without bull that we have sold on the 31st of March. And Latin America, and we expect to close Latin America next week. If it's not a week beginning of May, but we will try I would say to finish this Transaction, let's say next week, which means that the perimeter now is roughly the perimeter going forward there are still Some countries we want to close but are very small But in terms let's say of sale, I think it's finished Next change of cash. I think very good news. It's minus 47 million and So you have to understand that we have $71 million of restructuring. So it means that we have produced roughly $24 million of cash. And also, we have the bull cash consumption. Unfortunately, we are not able to estimate that cash consumption for now. We will do this, in fact, when we're going to close H1. Just for information, bull, the EBITDA was around minus 25, CAPEX minus 30. So EBITDA minus CAPEX is minus $55 million. We estimate that probably there is a positive working cap, but it's possible, of course, that bull has an impact of, let's say, around 10, 20, 30 million, we'll see. So it means, in fact, that the production of cash is much higher than, in fact, 24 million. And then the liquidity in billion is a little bit above last year, December 2025. And remember also that we have bought already 62 million of the 1.5L. So, of course, there is less cash. But we have also less debt. So let's go on the three years for the Genesis. So I'm not going to highlight. Remember that there were seven pillars in Genesis. There are a lot of things that we are doing. So first, the first one is the growth. So as I say, we have redesigned completely, for me, the engine of growth. And it's going to, I would say, produce a lot of, I would say, of course, results in the coming months now and years. So I would say the teams are in place, most of them, no? We have, I would say, also put a focus with Florine, the CTO, on our three strategic pillars, so agentics, sovereign, and cyber. We have now launched this morning for two or three months a campaign also in France, I would say, to... Let's say push the image of ATOS, and I would say the main message is that ATOS is back. And as I say, now the term, the target operating model, in fact, in cells is completely in place. You will see also, for example, that the pipeline has increased almost by 1 billion in one quarter, and I would say that gives, of course, very good signs for the rebound that we estimate that will happen, in fact, in Q3. In terms of country reviews, so we sold Ideol. It's a company that was in Nordics. It's mainly, in fact, Norway and Finland. So we closed the deal on the end of Jan. South America, as I say, next week, and Bull was done also end of March. In terms of operational costs, I think we are continuing, I would say, the progress. The bidability rate now is above 80%, and it's, in fact, close to 85%, the target that we have. We are now, let's say, recalculating a little bit differently this billability rate because we take into account now the average salary of the people that are not billed versus, I would say, the salary of people that are billed. And then there is, and we see that there is, of course, a discrepancy, and there is no, I would say, magic, but usually the people that are more costly, unfortunately, are more on the bench than the people that are billed. So I would say we will... not recalculate, I would say, this rate, but we will adjust it, I would say, to the salaries. Legal entities, we continue to simplify the number of entities. We want to shave, I would say, the number of entities by hundreds still. And then we are also putting some AI internally. And right now, for example, we are testing AI revenues So, in fact, we are looking at all the contracts that we have, and it's several thousand, and we look also at the options, or I would say the paragraphs in the different contracts that we have signed where we can extend the pricing or build a little bit differently so it can give, I would say, some rooms of improvement in terms of margin and revenues for the teams. But Genesys is going very well. The Genesys, the initial plan will be finished mid-26, so we estimate that the $650 million saving plan is almost complete. And that's why we have extended now the plan to have, I would say, a plan that will finish now end of 26. So it means it's a target above $700 million. In terms of workforce on page 9, as you can see, so we started the year at 63,000. We continue, I would say, the restructuring, and we also manage the levers versus irings to be negative. So we finish at 61,000. You take out bull to 2,500, so we are now at a little bit below 59. If you take South America, we are probably close to 56,000, so that's probably where we will be probably at the end of next week. And I would say the I definitely think that we will land around 55,000 when Genesys will be complete. So we are almost there. We go on page 10 on the order book. So first, the book-to-bill is very strong, 89 for Atos. And in North America, it's above 100. Just for the analyst, I always say that the book-to-bill is a proxy, unfortunately, of growth. And I think we have a very good example The book-to-bill of North America is above 100. They continue to decrease, unfortunately, in terms of top line in Q1. The book-to-bill of the U.K. is below 100, and now they're growing. So as I say, unfortunately, it's not an immediate, I would say, reading when you have a book-to-bill at below 100 that it means that we're not going to grow. I don't think that is the case. We are still looking to find a better measure. It's not an easy one, but we are working on it. I hope that we can probably share some, let's say, results in H1 at the end of the year. The qualified pipeline, as I say, is up roughly close to $1 billion. We are now at $13 billion roughly of qualified pipeline, so almost two years of revenues, a little bit less than two years, of course. The renewal rate also is 94%. The good news is that we don't have big renewals now going forward. So, in fact, for this year, I think we are not going to lose any other contracts. It has been done, of course, in the course of 25. The two big contracts in the U.S. have been renewed. One has been signed, in fact, at the end of March with CNA. It's a very big contract, 480 million dollars. And we are also discussing probably to extend the contract to more than this 500 million. We have probably, we're still in negotiation in the course of Q2. And the second one also is in California. We have won the contract. It will be signed in the course of April or May. It's done. We are just waiting, I would say, the signature of the client. And then for the U.S., it's done. We don't have big renewals, in fact, in other parts of the world. There is a medium-sized contract, in fact, in BNN right now. We are waiting the answer probably next week. And that's all, which I think is very good news. And that's why we are very confident on the rebound of the top line in Q3. And then, as you can imagine, we have a good traction in cloud, in cyber, and in data AI because we are growing, in fact, in these three service lines, let's say. You can see below some contracts that we have renewed. So, for example, CNA in the U.S., it's a very big contract. There is some CMNI, there is a digital workplace and cyber, and we are also now looking for digital applications and data AI, in fact, for the client. It's an insurance company, so I definitely think that Adjantic has a big impact, in fact, in this company. We have, for example, with Gigalith in France, renewed a four-year plan with Cyber. It's what we call framework agreement, so it means that we have after that the possibility, I would say, to tender, put people, or put, I would say, new projects in place. Most of the framework, in fact, are not in the book to build, so we are very cautious on this, and that's why it doesn't, I think, probably the book to build is a is a minor, I would say, minor of probably what is going to happen on the revenues going forward. In the UK, we have won a very good contract with the Ministry of Housing, 63 million per seven years for digital applications. And for example, in Germany, Austria, in Austria, we have won also a very big contract with OBB, 48 million for nine years. But I think that there is good traction. I see that there is more and more, I would say, appetite. Those are open from the clients. I think it's much better than last year. And definitely, I think now we need to win, I would say, the contract. So I would say we are back to a normal business. If we go on page 11, this is the three pillars in terms of technology. This is where we're going to invest most of our R&D and push, I would say, very hard. So agentic, sovereign, and cybersecurity. So agentic, as I say, we launched already the manifesto. We have already studios in place in the four big countries, and we have now signed different clients. And there is an ecosystem around us of startups that will help us, I would say, deliver the agentics and the agents in the different scenarios of our clients. Then with the sovereignty, so there is a manifesto also that we're going to produce. It has been already shared with the top 200 within Atos, in fact, last week. And we're going to share it now externally in the course of next week or probably beginning of May. There is a lot of appetite, as you can imagine, right now, especially in Europe. And then cyber, of course, there are a lot of things going with this. We see a Also some developments with there and of course we have a very strong position as you can imagine in Europe and we are pushing also cyber in North America. Now if I go to the next page, so the next section is the Q1 revenue performance so I can go through I would say the main numbers. So first, as you can see, when we looked at the Q1 restated, it's roughly 2 billion. We take out the scope and the foreign exchange, the divestitures. So in fact, the perimeter going forward, which is without bull and without ideal, and of course, without Latin America, was roughly 1.8 billion. We finished at 164. which is roughly minus 11%. And as I said, we're, in fact, anticipating, let's say, a weak Q1. It will be much better, in fact, in Q2. And we are still looking to make the rebound in Q3. If you look, in fact, on page 14 by region, we're probably a little bit, let's say, not surprised, but North America probably is too weak. The sentiment, in fact, the economic sentiment is... is a little bit, let's say, challenging in this area. The rest is OK. As you can see, the UK now is growing at plus 5. We estimate also that Germany will be on positive growth in Q2. So we see, I would say, region by region, that I would say we are coming back to a positive territory in the coming quarters. If I go, let's say, region by region, so I start with Germany on page 15, I think Germany is doing quite well. As you can imagine, also, the EBIT now is positive in Q1. It was negative last year. And by the way, just for information, the EBIT of the group has more than tripled without bull in Q1 versus last year. We don't publish, of course, the EBIT. We will do this, in fact, in Q1. But I would say we see the benefits of Genesys now falling through, I would say, the P&L already, of course, in the beginning of 26th. then you have, I would say, some contract wins. I'm not going to go over, but I would say we are stabilizing, I would say, Germany. And as I say, we estimate that the rebound will happen in the course of this year. Now, North America is probably the most difficult, let's say, region. In fact, the start of the year was probably lower than anticipated. But we are signing, in fact, a lot of new contracts. And the book-to-bill is 160, so it's big. And definitely now we estimate that we're going to ease, let's say, this contraction of revenue in quarters. You can see below some big wins. The biggest one, of course, is CNA. And also we have another one, CMNI, at $30 million, as you can see below on the bottom, I would say, of the page. Seventeen is France, so France is still so challenging. Remember also that we did not have a budget in January and February, so it freezes a lot of our public and defense customers, and public and defense in France is 40% of the revenues. So we know that the start of the year is probably, of course, lower than anticipated in the budget for us. But we have some very good signs. For example, with SNCF, when I arrived last year, they said that they want to stop to work with Atos, and finally we won a very big contract with them. So it means that now the doors are open, as I say, in many customers. Gigalith also, it's a bigger contract. We have one also for Cyber, and you can see also other, I would say, wins and qualifications. UK, on page 18, so that's the The rebound of the UK and also the profitability also is skyrocketing, as you can imagine. So we are very happy. And there is more to come. I think we have also a big contract in Q2 that will probably be public. So I would say we are quite confident right now in the UK. And as I said, that's the first region to come back to growth, and there will be more, of course, in the coming quarters. Last, the international markets on page 19. So we have taken out the 28, 30, that's Latin America. So, in fact, without Latin America, it's around 220 million, so minus 12. It's mainly, in fact, impacted by one client in Asia, in fact, that is stopping the CMNI contract because they want to manage internally, I would say, their data. The good news is that we suffered, in fact, in 25, and we continue to suffer in 26. But at the end of the year, this ramdown is completely finished. So it means that we are quite confident that we will restart growing, in fact, in the course of 27. You can see also some wins that we have in Singapore, Spain, and Slovak governments. Last, in fact, and it was not international, sorry, is, of course, at Benelux, so Benelux or BNN, what we call with Fatos, This is also a slow, let's say, start of the year, but we are, I would say, quite confident also that this region is doing very well. We have a win also with Eurocontrol, in the automotive sector with DAF, and also in the financial services, as you can see. Now, as you can see on page 21, So without Bull, in fact, the revenues were 71 million, and we are roughly at 69. It's roughly flattish. In fact, we have been impacted by the war because part, for example, for Vision AI, a big chunk of our business is in Middle East. So we definitely think that it will be much better after the war concludes, but when, nobody knows. But I would say we have a good traction in terms of also... and we are very confident that we will accelerate both in the book-to-bill going forward and also, I would say, in the top line. So that's it for me. I give the floor now to Jacques-Francois for the liquidity position.

Thank you, Philippe, and hi, everyone. So on page 23, as a reminder, the publication of the quarterly liquidity position is part of our regular reporting requirements, which have been defined and agreed with the group's financial creditors. So the certificates are available on our website. Our liquidity position remains strong at the end of March, thanks to the limited estimated cash consumption over the last quarter. In Q1, the net change in cash is estimated to be approximately minus 47 million euros, which includes 71 million euros spent related to the restructuring. This figure is reported without any use of the account receivable factoring or without any specific optimization on trade payables. This number is also reflecting the results before the estimated impact. So we take them from the left to the right on the slide. So A, the change in the unsolicited payments received in advance of the invoice payment due date during the year. So that's the minus €115 million. Then you have the exchange rate fluctuation, which amounts to approximately minus €2 million. You have the MLA impact, which is plus €257 million. And you have the debt repayment of minus €62 million. So these amounts are excluded from the net change in cash, which I announced is minus 47 million euros. And that brings us, as a result, as of the end of March 26, to have the Atos Group's liquidity at 1,736,000,000 euros, which is to be compared with 1,705,000,000 euros at the end of December 25. And this is more than 1 billion above the minimum requirement of 650 million euros set by the credit documentation. So with that, I'll now hand over to Philippe.

Okay, so just for the outlook, just I give you the numbers now with the ethics at the end of March. So it's a little change just because, of course, as you can imagine, the dollar is weaker, so... It gives in euros, let's say, smaller revenues at the end of 2025 with the FX of March. So we are still at 7.1 billion, so compared to 7.1 billion, of course, at the end of 2025, 200 million and 12 as the EBIT. We are now close, as I said, to 56,000 people without a market share. And we are now in 54 countries of operation. So as I say, we continue also to close some countries. We'll be below 50 at the end of the year. Now, if I go on page 26 for the guidance of this year, so remember that at the beginning of this year, we say we will try to touch positive organic growth with, let's say, the start of this year and the Let's say the economic sentiment, we estimate that it's not going to be possible. So we have a narrow, I would say, the range. It's between minus 1 and minus 5. So we still keep, I would say, the worst case at minus 5. We think we will do probably better than that. And the best case, let's say, to minus 1. So we're going to see a flat-ish revenue. Operating margin confirmed at 7%. As I say, we have more than triple the EBIT, in fact, in Q1. So we are very confident on the profitability of this group. 426, of course, and a positive net change in cash. So, in fact, you've seen that we have already spent 70 million with Genesys in Q1. Genesys this year is probably between 150 and 200 million. So we have, in fact, expanded more than I would say the average that we should have by a quarter. And it's normal because we are accelerating the plan. And of course, the EBIT of the Q1 is always the lowest. So it means that it's a good sign, I would say, for the cash going forward. And then I would say for 2028, next year and 2028, we are still looking for an acceleration of the top line, still targeting around 10% of profitability. And of course, the deleveraging will continue. In fact, I would say with this year, the deleveraging, in fact, will be seen already, in fact, in 2026. And in fact, with... hundreds of millions of cash next year because, in fact, the genesis in terms of cash house next year will be very small. We will produce a lot of cash to either do M&A or deleverage, I would say, the balance sheet. With that, I can now, with Jacques-Francois, take any questions that you have on the Q1 results. Q1 performance is not really a result because we don't produce the P&L.

Thank you, management. We will now begin the question and answer session. To ask questions on the phone, please press star one and one and wait for a name to be announced. To cancel your request, you can press star one and one again. One moment for the first question. Our first question comes from the line of Frederic Ollant from Bank of America. Please go ahead.

Hey, good morning, Philippe. Good morning, Jacques-Francois. Thanks for the questions. If I can ask two, firstly on demand, so you flag a strong order book, momentum, number of big contract wins. Can you discuss a little bit the nature of discussions with clients and impact on demand from the current macro? I mean, you flag that for evidence that we'd be keen to hear any broader impact on the overall demand environment. And then specifically around pricing, would be good to understand where you see price points in the deals you've been signing recently, how it's comparing versus, let's say, a year ago, and is this pricing driven by any kind of competitive or AI factors? Thank you.

Yeah. So on the second point, Frédéric, for example, CNA, the margin is 25, which is roughly in line with the former margin that we have with CNA. Remember that the goal we have is to be around 25, 26. It's very important. And I'm very adamant on this. I think probably, and that's why also the book to build also last year and this year is probably lower than what we can achieve because we are still watching very closely the margin that we want to produce. Profitable growth, remember, is the goal for us. It's not very difficult to buy some contracts, but I would say it's forbidden, of course, as you can imagine, since the beginning of 25. In fact, in some contracts, for example, like CNA, and it probably goes with the sentiment of the clients, everybody, of course, is talking about AI. Nobody probably understands the impact of AI because it's very difficult right now to see what is going to happen. There are a lot of, of course, disappointments, in fact, with some clients trying to put some agents because it's not that easy. And my view is that Adjantic is the new revolution. It's coming. But it will take probably two to five years to be really enforced. Probably more in the U.S. at the beginning and after in Europe. So we see that in these contracts, for example, 14A, it's an eight-year contract. We're going to give, for example, some savings after year three and four in terms of, let's say, in terms of adjantic. But in fact, as I probably said already, since we don't know exactly the number of things in fact we're going to share part of the savings that we're going to produce but it's difficult in fact for clients and even for us to see the impact the real impact i would say of the things we're going to have so there are a lot of studies i'm sure that you've read some of them saying that we can divide by two by three by whatever unfortunately there is one cause that nobody knows it's the price per token And we definitely think that this will probably skyrocket in the future. And so it means that, in fact, there is a price for adjournment. There is probably, of course, less people cost in the contracts going forward. But the sum of the two right now is still, I would say, unknown. So I would say everybody is talking about AI. Everybody wants to give some... Some rebates or not rebates, but I would say to apply, let's say, adjuncts in our delivery and then give, of course, but I would say it's too soon. Even with the big contracts we are signing right now, they understand that there will be an impact, but it's too soon to say that there is a big impact. And as I said, for us, we're going to protect the margin. So we estimate that the margin of 25 probably will be more after that. And then we can probably produce more output on a given framework. Now, the sentiment, I would say, of clients, it depends on the sector. I think there are some sectors that are probably more difficult than the rest. Automotive is one, transportation, luxury goods. And other sectors, we don't see, in fact, a big impact on right now, let's say, the economy, the banking sector, insurance sector, defense, of course, and public, where we are very strong, health care. So I would say it's a mixed sentiment, but You know that in economy, unfortunately, the fact that there is a lot of uncertainty doesn't give, I would say, the sentiment to clients that they can spend more specifically with AI. So I would say that for the moment, probably there is a postponement of some contracts or projects. They are looking exactly, probably waiting, let's say, to see how the economy is going to rebound after the war. So there is more wait and see in some clients, let's say, for some projects. And that's what we see for the moment. My view is that the projects will open, but in fact, if you, of course, extend or postpone, let's say, by three to six months, it has an impact, in fact, for the 26 years. And then, of course, it will be good news for, let's say, end of this year and, of course, in 2027.

Okay. Thank you very much.

Questions? Once again, to ask questions, please press star 1-1. Our next question comes from Sam Morton from Invesco. Please go ahead.

Hi. Two questions, please. The first is the bond buyback. So I think you brought back 62 million of the one and a half lien. In Q, certainly the last time we spoke, I think you've been buying back the second lien. So I'm trying to understand what's the change in strategy there. And then secondly, any update you can provide on the refinancing, that would be really helpful. Thank you.

Yeah, I think Jacques-François is going to answer your two questions.

Hello, Sam. So, yes, the change of strategy is more or less in line, I think, with what we announced in the Q4 publication call. where we said that at the end of fiscal year 25, we thought the second lien was really very low, actually, and put opportunistically a little bit of that. So last year, this was 2.5 million of second lien. Now, when we look at the NPV, the second lien has gone up, and it's true that the 62 million amount we have bought back on the market, on the open market, was only 1.5 lien bonds. Again, we noticed that, how can I say, this bond was momentarily trading below due to geopolitical, you know, the situation, nothing to do with the performance of the company. So since we had a little bit excess of cash, we decided to take advantage of that. We signaled that and we implemented this program, which is not finished, by the way. It might be pursued in the coming weeks or months. That's the first question. On the second question, the refi, well, we are monitoring the market. The company is ready. So we have nothing to announce today other than we are checking how the market is evolving. We have some banks advising us. And when we think there is a good window allowing for a good operation and a good pricing, you know, you and investors might hear from us.

Okay, great. Thanks a lot.

You're welcome.

Thank you for the question. One moment for the next question. Next question comes from the line of Laurent Doré from Kepler Chevrolet. Please go ahead.

Yes. Good morning, gentlemen. I have two easy quick questions. The first is on revenue trends during the year. I think if I take the midpoint of your guide, How do you see the phasing from Q1 to Q4 and what are the main drivers of improvement? Do you still have some contract ramp up that makes the revenue trend much better maybe starting in Q2 or is it comps and PACs? Any granularity on how you see the year shaping would be helpful. And my second question is on the bond buyback. To clarify, you made 62 million. Are you cautiously looking at your balance sheet? Could you do much more than 62, like 200, 300 million? Is it a question of liquidity of those bonds? So anything on the strategy on that will also help. Thank you.

Yeah, so in fact, for the... We estimate Q2 will be around minus 6, and then positive in Q3 and Q4. The positive, then you calculate whatever you want. The central scenario, let's say at minus 3, for me, will be OK. And of course, if you have minus 11, minus 6, then plus 10 plus. If you divide it after that by 4, you are probably around this minus 3%. So I would say the central is around minus 3. The worst case is at minus 5. Then for the bond buybacks, the question for us, of course, we have probably plenty of cash, as you can imagine. And also, in fact, we're going to produce some cash this year. So if we start at minus 50, of course, we're going to produce 50 million plus now in the coming quarters. We want to buy, in fact, the 1.5L bond. In fact, that's the one we are looking at that is below 100. So I think it's a good, let's say, buy for the group because it's cheaper than, I would say, the PAR, in fact, for the bonds. And remember that the bonds are on 9% yield. We are, remember that we are also looking at refinancing, so that's why we have to be a little bit cautious between the refinancing. And remember also that we have some repayments of the 1.5L with the proceeds of M&A that should occur, in fact, at the end of the year. So it's an equation, I would say, with all this all these variables, so we will see if we continue to buy back bonds or we refinance first and then we continue to buy back also, we will see.

So at the end of this year, you have to pay back with this half of your proceeds from M&A, is it right?

Exactly, the proceeds of World Grid, the proceeds of Latin America, of Ideal, of course it's small amounts for the two, and the proceeds of Bull. But it could be 500 million plus. So remember that we have this 500 million plus cash out that will happen at the end of the year.

May I complement? Laurent, this is as part of the credit documentation. We have a couple of moments in time in the near future where we are going to do the liquidity test. There is a bar at 1.1 billion of liquidity. At the end of June, we are testing that on a forward-looking basis, meaning that the company will do our forecast internally, and the amounts which are above 1.1 billion at the end of December, we will use them to reimburse as a mandatory early repayment the 1.5 lean tranche. um that's the first test and the second test is we take the liquidity position the actual liquidity position at the end of december and again against the 1.1 billion the amounts coming from the mna proceeds will be used to repay early some one whether the 1.5 lean capped at the amount which leaves us above the 1.1 billion position i hope it's clear to me to be even clearer uh

If you do all that, what is your best estimate in terms of interest savings in 27 versus 2026 at group level?

I'm afraid there are too many unknowns in the equation to give you a number.

If we do the refinancing, there are a lot of things that could happen again in the course of this year. So it's too soon to give you already a let's say a guidance on interest rates for 27. We can probably give this with the Q3 results. So probably in October, I think we'll have a better view. Okay. Looking forward. Thanks. Yeah.

One moment for the next question. Our next question comes from Benoit de Proysia from Karen Finance. Please go ahead.

Thanks for taking my question. Just one very quick question. You had one black contract in the UK involving Aegon. I noticed that Aegon sold its UK subsidiary in a few weeks ago. Do you think that you could renegotiate with the the contract you have and that is set to terminate in a few years, in 2034, 2033, if I'm not wrong?

It's a very good question. Yes, the end of the contract is 2034. Yes, you have noticed that Aegon UK has been sold. So we are talking now to the buyer. It will be in May. In fact, we need to wait. And, of course, the buyer has already a platform. So the good news is that do they want to keep only one platform or not and then stop the platform of Aegon, which then, of course, will stop the contract. It's too soon because, of course, we haven't talked yet, I would say, to the buyer. So we will have, of course, a better view. in the coming months. But I think for us it's a good news, because I definitely think that they will not keep, in terms of economies of scale, it doesn't make sense for them, I would say, to have two platforms. I think that their platform also is very efficient. So we will see how they want to play this. So there is a possibility, effectively, that they ask us to stop the platform that we have and then transfer the data to their new platform. So it means that the contract can end in the course, for example, of 2027. We will see. I don't know yet. It's too soon. But it's a very good question, and it gives a good opportunity for us, yes. Okay.

Thank you. That's all on my side.

For the questions, our next questions will come from Delilah Ryan-Hu from PVT Airpoint. Please go ahead.

Hi guys, thanks for taking the question. Just one quick one for me. So you've given quite clear guidance on sort of the cash add-backs or the adjustments to net change in cash to get to a true sort of unlevered or pre-debt repayment cash generation. Can you just help steer us on your 26 guidance? Clearly there's a range there, but it feels from the adjustments you've discussed that actually the net change in cash will be considerably better than just positive. So just any further sort of color you could give would be really helpful.

Well, Ryan, thanks for your trust and your faith. At this stage, our commitment and our guidance is to be free cash flow positive. I'm sorry, I will not deviate from that. Bear in mind that we have, you know, Philippe mentioned the Genesis cash out impact is between 150 and 200. So that's not nothing. And we have all the other lines of the cash flow statement, which are still consuming some cash. So, yes, we're shooting for more, but our commitment is to be free cash flow greater than zero.

But as you say, it's probably a conservative guidance. Got it.

Cool. Thank you.

Thank you for the questions. One moment for the next question. Our next question comes from Derek Marcon from Bernstein. Please go ahead.

Yes, good morning, guys. I hope you all hear me well. Two questions for me. The first one on the book to build, I just want to understand if the 87% is applied to the reported figures or the fully planned scope. And in this book to build, talking about in absolute terms, what's the proportion between renewal and new business? that would be helpful to add this figure. And my second question is on the M&A, the 257 million euros you mentioned. Can you re-explain what is included in this figure? Thank you.

Okay. So the 87 is ATOS and Eviden. ATOS only is 89 because, as I say, Eviden has suffered from the war more than, I would say, the impact is more, I would say, than ATOS. And evident is more Europe, Middle East, in fact. So that's why probably I think the impact is higher. We definitely think that the rebound will come, but of course we need to have more, let's say, stability.

Then the book to be between renewables... Is it on the go-forward perimeter or on the reported perimeter? Yeah, the go-forward. The 1.7 or the 1.6 billion euro?

No, no, it's only on the perimeter without Latin America and bulls. So 87, 89. 87 is the go-forward, and 89 is only ATOS. Okay? And it's ATOS without Latin America. 87 is with Eviden, without Bull. And then the renewals versus, we don't have this number available right now. I cannot tell you. So we will come back to you on this one. And remember also, yeah, you're right, that with renewals, of course, as I say, it inflates also the book-to-bill. And that's why it's a proxy for the book-to-bill. Be careful on this. It's not because the book-to-bill is below 100 that we're not going to grow on the company. I definitely think that it's possible. And, in fact, we have shown this in the U.K. Then for bulls. So bulls, in fact, remember, there is a lump sum of 300 million at the beginning plus two amounts. The 300 million is the EV, the 250 is the equity. So in fact, we went from EV to equity without the provisions and the pensions. So it means that the 250 million was the equity check that we had for bull without the two earnouts. Then the 250, we take out the carve-out cost. We estimate around 50 million. Part of it was the expense, I would say, in the course of 25. The rest, of course, in Q1. We estimate around $50 million. So it means that the net cash for us is close to $200 million. Remember also that Bull has a negative cash flow in Q1. We don't know how much. So we need to take this also into account. So the $200 million will be probably less. 170, 180, I don't know yet exactly how much. As I said, it depends on the working capital we're going to have on bull, but it's quite tricky for us to calculate the working capital of bull because, in fact, for some of activities of bull, they were on the same company as Atos or the other resident, and that's why even on the bank accounts, unfortunately, we need to look line by line on the cash, I would say, to reconstruct, let's say, the working capital, and that's why we're going to give you the figures with the H1 figure, in fact. So that's roughly $200 million without car value cost, and I would say equity check, probably less with the cash outflow of bull in Q1. And then we still have the earn out. The first one is maximum $50 million, and we estimate we can gain around, let's say, $40 million plus. We will see, I would say, they need to close their account. And it's, I would say, linked to the gross margin of bull. And then the second round is on the EBIT of bull in 26. But of course, as you can imagine, the EBIT of bull in 26 is not in my hand, unfortunately. So it's difficult to see what is going to happen on the second round. So we will see what happens on the first one. It's going to be a negotiation that will start now, I would say, After the closing of the accounts, unfortunately, Bull is not very, let's say, quick on the closing accounts. So we will have probably numbers probably after the summer.

And so to get, Philippe, to get to the 257 mentioned in the liquidity position, so you have Bull, 200 million euros after carve-out, if I understood correctly, plus other things, like Scandi or Latin America or... No, sorry, Eric.

Sure. So, the angle Philippe took was the angle of explaining the story for Bull. Now, in the carve-out costs, some of that has been spent in 25 already, a little portion in Q1 26, and there is a bit more to come in the rest of 26. The vast majority of the 257 you can see is coming from Bull. The vast majority of that. You have then a plus 10 and a minus 10, which comes from the disposal of some other relatively small assets and some deduction for the carbon cost for Cartier. But you can assume that 95% of that is Bull.

And Latin America and Scandi will come later in the year?

Scandi has been closed. Scandi has been closed already. That's what I was referring to as other proceeds. That has been completed in Q1 already. And for Latin America, the closing is scheduled in the coming weeks. So there is not a penny yet of proceeds from Latin America in our Q1 numbers. Okay.

That's perfect. Thank you. Thank you both.

Thank you for the questions. We have no further questions from the line. Allow me to hand the call back to management for closing.

Okay. Can you ask one more time if there are other questions or not, and then we can close.

As a reminder, if you'd like to ask questions, you can press star 1 and 1.

Okay. If there are no more questions, then thank you, everybody, for this morning. We have some... No, it's a small roadshow, I would say, with some investors today and tomorrow. And we, of course, remain at your disposal if you have any questions. But overall, I would say we are very confident on the rebound of the company. I'm very pleased, I would say, on the results and very confident that this year of the rebound and in terms of cash flow, I think there is no surprise for us, neither on, I would say, the profitability and cash flow. And the rebound will occur in the course of H2. So next time I will talk to you end of July now. So have a good day and see you in three months. Bye-bye.

That does conclude today's conference call. Thank you for your participation. You may now disconnect your line.