The UK arm of Atos, the French technology company that is a key supplier to the NHS and UK government departments, faces “material uncertainty” over its ability to continue as a going concern, accountants have warned.
In the British holding company’s latest 2022 accounts, the company’s auditor Grant Thornton said financial problems facing its parent company in France could limit the UK arm’s ability to access cash and continue as a going concern.
In April, Atos UK’s parent company announced total debt of almost €5 billionand looked at financial restructuring offers to stabilize finances.
The auditors’ findings, first reported by The Times, also warned that if the parent company failed to successfully negotiate or renegotiate loans or sell assets, the UK arm could face being unable to service its own debts.
Atos is one of the UK government’s forty strategic suppliers, a group of select contractors that have billions of pounds worth of contracts with government departments.
According to researchers at data firm Tussell, Atos has almost £1bn in revenue from 43 contracts, including the supply of IT systems to the NHS, the Ministry of Defence and the Department for Work and Pensions.
However, the government is monitoring Atos’ financial problems and i newspaper reports that the government has drawn up contingency plans to maintain public services if Atos cannot meet demands. They reportedly include lining up other potential IT suppliers if Atos cannot continue to provide these services.
The troubled French IT company has had a turbulent few years as it tried to tackle its growing debt pile. During that period, the company’s shares have fallen in value by 97%, while it has also had four CEOs in two years.
Included in its plan to raise cash, it has sought to sell off parts of the business, with the French government this month offering €700 million to buy key assets of its security and data divisions.
The company is also trying to reach a rescue deal that would restructure its debt.
On Wednesday it revealed it had received a new restructuring deal from a committee of bondholders after talks with a consortium of investors led by David Layani’s Onepoint collapsed.
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In its 2022 accounts, which were written ahead of the recent restructuring proposals, Grant Thornton said that due to the wider difficulties and uncertainty over the restructuring of the business intended for the UK arm, there is a “material uncertainty that could cast significant doubt about the company’s ability to continue as an ongoing concern.”
An Atos spokesperson said: “Atos is currently undergoing a financial restructuring, which will create a stable financial future globally and in the UK.
“Services to our customers are unaffected and we will continue to provide high quality services to the UK public and private sectors, as we have done for more than 30 years.”