Atos aims to draw a line under accounting issues with repositioning
July 27 (Reuters) - Atos SE said on Tuesday it was repositioning its portfolio to focus on core markets as it looks to draw a line under accounting issues flagged earlier this year.
A review of its two units in North America, where auditors had pointed to internal control weaknesses leading to accounting errors, "did not reveal any material misstatement," the French IT consulting group said, adding it would seek partners for several classic infrastructure activities representing a total scope of around 20% of revenue.
The affected units, Atos IT Solutions and Services and Atos IT Outsourcing Services, accounted for about 11% of Atos' 2020 consolidated turnover.
The software group, whose first-half operating earnings dropped to 302 million euros ($357.27 million) from 427 million euros last year, has faced a series of setbacks as the market questioned its ability to catch up with the latest shift-to-digital trends.
The turnaround of its classic infrastructure loss-making business in Germany will lead to 1,300 lay-offs by the end of 2023, with costs estimated at 180 million euros, Atos said.
It also announced the acquisition of two cloud services specialists, Nimbix and Visual BI, without disclosing financial details, to support its development in digital, cloud and security solutions.
The company confirmed its 2021 guidance which was revised earlier this month after the half-year preliminary results disappointed its own expectations.
At the time, the revision wiped nearly 860 million euros off its market capitalisation, while the stock has lost almost 22% since and is down close to 45% this year.
"We expect it will take some time for the market to digest the range of problems Atos is facing," Barclays said in a recent client note. ($1 = 0.8453 euros) (Reporting by Juliette Portala and Piotr Lipinski in Gdansk ; Editing by Jonathan Oatis and Mike Harrison)
