Half-year results 2018: Solid operating performance delivering 10.1% margin

  • Revenues: €1,373m (+18.5% reported and +5.2% economic growth vs. H1 2017)
  • Operating margin: €138.5m (+28.8% vs. H1 2017)
  • 10.1% operating margin, +80 bps vs. H1 2017
  • Adjusted net income at €57.5m, +2.2% vs. H1 2017
  • Free Cash Flow at -€225m mostly impacted by Aricent’s transaction and working capital variation, not reflective of full year expectation
  • External investigation confirms Aricent forgery is an isolated event


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Altran posted a solid operating performance in H1 while completing a key transformative deal. In what was a very busy semester, we recorded growth across our geographies and particularly in Altran US operations which was a key management objective. We announced mid-July an incident within Aricent, and following the external investigation, the forgery is confirmed to be an isolated event. The integration of Aricent is well on track, we have launched a targeted action plan early July to restore Aricent’s margin to its previous profile by year end. Our team is fully focused on top line growth, profit expansion and enhanced cash conversion. Dominique Cerutti Altran Chairman and Chief Executive Officer


The performance of the Group reflects the contribution of Aricent starting 20 March 2018. H2 2018 will be the first reporting period including the full contribution of Aricent. All reported figures fully reflect the implementation of IFRS15. Financial statements for H1 2017 have been restated accordingly.

Altran reported robust H1 2018 revenues of €1,372.7m vs €1,158.0m in H1 2017 (up 18.5%), representing organic  growth of 5.0% and economic growth of 5.2%.

The Group’s operating margin amounted to 138.5m, up 28.8% compared to H1 2017, reflecting the growth of the business and the contribution of Aricent.

Aricent contributed €162 million revenues over the period, starting 20 March 2018, and €27.4 million in operating margin, or 16.9%.

Group net financial expenses came in at €53.8m, compared to €14.1m in H1 2017 when the Company’s debt was much lower. H1 2018 is impacted by €23.9m of one-off costs and penalties related to early debt repayments linked to the implementation of the new financing structure for Altran.

Adjusted net income increased by 2.2%, to €57.5m compared with €56.2m in H1 2017. On a reported basis, net income for the period was €9.5m, reflecting the various Aricent acquisition-related items.

Detailed analysis of revenues

  • France: economic growth +4.3%. Net hiring accelerated in the second quarter and should further benefit from an ambitious recruitment campaign in Q2 and Q3. 
  • Europe: economic growth +5.7%. Economic growth in the region is strongly accelerating compared to H1 2017. In Germany, the Group’s priority remains the profit turnaround as revenue growth is now sustained. Iberia and Italy remain on a high growth path and business trends in those geographies are excellent. Belgium & the Netherlands are improving in Q2. The UK posted a solid and strengthening performance, particularly remarkable in the context of Brexit. Scandinavia and Switzerland have returned to growth. 
  • Americas: economic growth +9.7%. The region has achieved double-digit growth in H1 following our successful integration efforts.

Cash and debt

At the end of H1 2018, the Group’s Free Cash Flow came in at -€225m, vs. -€14m at end-June 2017 (H1 2017 normalized for a €35m invoicing shift was -€49m). This significant difference is due to cash outflows related to Aricent’s acquisition, new cash items induced by Aricent and working capital variation. The H1 2018 Free Cash flow level is not reflective of the Free Cash Flow expected for the full year.

The Group’s net debt came in at €1,698m in H1 2018, versus €351m at end-December 2017 This reflects the set up of the new financial  structure of the Group including the acquisition-related debt and rights issue. This translates into a c.4.2x leverage ratio end of H1, which is consistent with our deleveraging pattern.

At the end of H1 2018, the Group had available cash of €208m, vs. €373m at end-December 2017, after the €61m dividend payment.

Aricent incident

On 13 July 2018, we announced a pre-acquisition forgery discovered at Aricent. $10m of forged purchase orders were booked at Aricent between Q3 2017 and Q1 2018. This was the act of one individual affecting one client only.

As a consequence, Aricent’s margin was reassessed from the previously communicated 18.3% margin (LTM September 2017) to 15.6% (LTM June 2018), taking into account:

  • the reversal of the profit linked to the $10m of forged purchase orders; and
  • in the context of this inflated profit, misguided spending decisions and accelerated investments which have not yet materialized in expected growth.

An external investigation was immediately launched after the discovery of the incident; it has confirmed that the forgery was an isolated event.

An action plan was implemented as early as July to restore Aricent’s margin profile to previously communicated levels, and we foresee this targeted action plan to bear expected fruits by year end.

We also initiated a complete overhaul of Aricent’s internal controls to bring them to the highest standards.

The Company’s counsels will advise on the next legal steps and provide the Board of Directors with recommendations.


Altran presented during its Capital Market Day on 28 June 2018 its new mid-term strategic plan. The deployment of The High Road, Altran 2022 strategic plan is expected to achieve in 2022:

  • Revenues: c.€4.0 billion at constant perimeter
  • Operating Margin: c.14.5% of Revenues
  • Free cash Flow (incl. financing costs): c.9% of Revenues
  • Leverage ratio: below 1.5x
  • Earnings per Share: x2 (vs. reported 2017 of €0.68/share)

The Group will deploy its capital in a balanced way between shareholder value creation, reinvestment in the business, and taxes and financial commitments is anticipated. The Group’s financial policy will prioritize deleveraging, with the objective to be below 2.5x in 2020.

Press Release

Half-year results 2018: Solid operating performance delivering 10.1% margin


Presentation Deck

Half-year results 2018


Interim Financial Report