...Good morning, and thank you to be with us this morning with such a short notice. Due to the H1 results, which are lower than we expected, and what we envisage for the rest of the year, we have to adjust our objectives for the full year, and according to EU regulations, we inform today the market without waiting for the release of H1 results, which is planned on July twenty-eighth. Before going to the figures, I want to make here a few important statements. First of all, the announcement of this morning aims at presenting to you a fair, realistic, and reasonable assessment of the impacts at stake. Second, in this context, the group has decided to accelerate its transformation agenda engaged last year, both organically and inorganically, by investing in digital, cloud, security, and decarbonization, all being areas where the group already records many successes.
Third, and this is certainly my main message for today, this all means twenty twenty-one is a year of transition for Atos towards a new group, a new Atos. Twenty twenty-one is definitely a year of reset and a new start for this group, and because we are tackling the issues in such a straightforward manner, I am confident to reach our midterm plan and targets. Let's now turn to the figures themselves on slide three. Let me first remind you that, obviously, all figures we give you today relating to H1 are provisional and have not been yet audited. You will also understand that more detailed figures by industries and by regions with all details will be disclosed only on July twenty-eighth. In H1, group revenue at constant currency decreased by 1% with a Q1 at -1.9% and a stable Q2.
Organic growth remained negative in H1 at minus 2.7%, with a Q1 at minus 3.9% and a Q2 at minus 1.5%, while we were expecting a positive organic growth in the last quarter. The group faced an accelerated decline of our legacy infrastructure business in a context of a much stronger and much faster cloud migration post-COVID. We consider that this effect will continue during the second semester. The rest of the activities of the group is doing well or very well as they benefit from the economic recovery, driving a booming digital demand. Atos Syntel, application projects, cloud, cybersecurity, and big data, all of them were growing in Q2 organically, and for some of them, double digit. They will support the second half of the year.
In this context, the group adjusts its objective of revenue growth at constant currency for the full year to stable. Operating margin reached 5.5% in H1, below what we expected, although for this year, the group had anticipated a higher seasonality between the first and the second semesters. In particular, operating margin was strongly impacted in H1 by the reduction in revenue of legacy activities, which have a low short-term cost flexibility, both in terms of staff and installed infrastructure. The group adjusts its operating margin rate objective for the full year to circa 6%. As a consequence of this unprecedented business impact, several exceptional items, such as write-off of assets or loss provisions, have been booked under other operating income and expenses. This line amounts to a total of circa EUR 160 million in H1. Coming to free cash flow now.
In H1, free cash flow was mainly impacted by working capital and in particular, a reduction in cash in advance from customers. Moving forward, the group decides to reduce cash in advance from customers. Considering the operating margin objective reduction, the working capital effect, and more specifically on client advance payments, and the full amount of EUR 180 million for the plan to turn around the German infrastructure business, for which we reached an agreement with the social partners, and on which I will come back later, the free cash flow objective for 2021 is adjusted to positive. I will now hand the floor to Uwe, who is going to provide you with more detailed information on the bridges between initial and new objectives, and I will come back afterwards on the next steps for the group.
Thank you, Elie, and good morning, everyone. I'd like to give you some of the bridging elements of the operating margin guidance for twenty twenty-one, going from our initial guidance of 9.4%-9.8%, down to circa 6%. As mentioned by Elie, the legacy business is declining stronger than anticipated due to the accelerated migration of customers to the cloud. This trend, which will continue in the second semester, is impacting our operating margin as the cost base of our infrastructure legacy business has a low variability. Costs are more CapEx intensive. In some countries, the impact is amplified by a very low flexibility in personnel expenses. This represents circa 270 basis points decrease of operating margin rate, which we reflect in the new objective for the full year.
Given the high demand on cloud, on digital and security skills, we increase our investment in recruitment, upskilling, and retention, which accounts for circa 40 basis points. Besides that, the initial guidance included a portion of the benefits from the German turnaround plan for the infrastructure business starting in the first semester, while it will actually start off in the course of the second semester. In addition, in the big data and high performance platform business, we experienced slightly higher costs due to the current shortage of components in the marketplace. Let's move to the free cash flow. For free cash flow, basically, there are two items that I want to emphasize here, besides, of course, the impact from operating margin decline compared to the initial guidance. The first one is that we decide to reduce the volume of cash in advance payments from customers.
This will lead this year to circa €200 million reduction in free cash flow. The second item is the German plan for the turnaround of the infrastructure business. We have assumed in the new objective a one-off cash outflow of €180 million in the second semester, corresponding to the entirety of the plan, while we were assuming so far only the 2021 portion of the plan for circa €60 million. This plan goes beyond restructuring, and it will help our German activities to gain agility and competitiveness that are necessary to drive growth and profitability. Overall, the new objective is a positive free cash flow for 2021. Back to you, Elie.
Thank you, Uwe, and let's move now to the next slide on the next steps for the group. First of all, the group has decided to accelerate its transformation, both organically and inorganically, by expanding and focusing on digital cloud security and decarbonization. Our portfolio review that I announced to you in April is being finalized, and we will communicate its conclusions on July twenty-eight, so that we can move to execution swiftly. Similarly, as Uwe just explained, the negotiations with social partners regarding the necessary turnaround of German infrastructure business have concluded to the launch of a restructuring plan of circa one thousand three hundred people. This very important plan is expected to provide an improvement of one percentage point of operating margin at group level in the midterm. We will have a specific section on this subject at the H1 release.
As a conclusion, 2021, as I said, is a year of transition for the group. We expect to improve all the KPIs next year, and considering the positive effect that will come from the transformation of the group, both organically and inorganically, I mean by that, with acquisitions and disposals, the group maintains all its midterm targets, meaning at midterm, 5-7% revenue growth at constant currency, 11-12% for operating margin, and a conversion of operating margin to free cash flow above 60%. Before going to the questions, I want to give you the latest status regarding the North American audit, for which the group decided in April this year, to perform a full accounting review of those entities as of December 31, 2020, supported by external advisors.
This work is being finalized, and at this stage, the statements identified are not material. The auditor's work is also ongoing as part of the half-year review. The completion of this process is targeted to be achieved at the time of H1 release on July 28, 2021. Besides, the remediation and prevention plan has been finalized and is now being rolled out. Thank you for your attention, and we're now going to take your questions.
Ladies and gentlemen, we will now begin the question and answer session. As a reminder, should you wish to ask a question, you will press star and one on your telephone keypad and wait for your name to be announced. Once again, to ask a question, please press star and one. Our first question comes from the line of Michael Briest from UBS. Your line is now open. Please ask your question.
Good morning. Thank you. A couple from me. Elie, just in terms of the midterm ambition, I think implicitly twenty twenty-four was the endpoint where you get to these targets. Are you confirming that is still the ambition? And will it be quite a linear progression from the twenty twenty-one reset? And then just in terms of the accelerated transformation, previously, you were talking about sort of two hundred basis points a year of acquired growth. Will that increase now because you're gonna do more acquisitions, is that implied? And you know, just a final one on the balance sheet, you're unlevered. What is your view on buybacks in the light of today's update and likely share price reaction? Thanks.
Hi, Michael, and thanks for the questions. On your first question, the midterm means twenty twenty-four, twenty twenty-five. That's what we said when we announced last year our plan. With regard to the trajectory to get there, I think we will be more specific later on. I can't be more specific today. I think we need a bit of time to be more specific on the trajectory. But it will be, of course, a progress trajectory. But now, what is the exact curve, we'll come back on this later. On the acquisitions, we intend to accelerate our acquisitions. As I said, we need, for this transformation, organically and inorganically, to drastically increase the share of our cloud, digital, security, and decarbonization business.
So we will make acquisitions. If you remember, the 2% scope was the so-called self-finance or let's say, BAU acquisitions, and we've always said that we would be ready to go farther than that for larger acquisitions, like, let's say, mid-size acquisitions. So this doesn't change, and I would say would carry even more emphasis in the current context. On the share buyback, the current view of the group is that with this agenda that I just described, we are not willing to implement a share buyback at the moment. As we said in the past, the stance remains the same. It's not a dogma, okay? It's not...
So if at some point we think with the board of directors that it makes sense, and it's compatible with the transformation agenda that I've just talked about, I mean, the board of directors will be ready to do this. It's not the situation at the moment. This is being reviewed by the board very regularly, and one last point is that, of course, we talked about acquisitions, but as I said in my presentation, and as you know, we are ready also to make some disposals to accelerate this transformation. That's what we announced back in April, announcing the launch of a portfolio review.
Thank you.
Thank you, Michael.
Thank you. Next question comes from the line of Laurent Daure from Kepler Cheuvreux. The line is now open. Please go ahead.
Yeah, great. Thank you, Uwe. Good morning, gentlemen. I have two questions. The first is, I know you don't want to be too specific today, but you need now 500 basis points of margin improvement. Could you give us a little bit of granularity on the main drivers, the utilization rate that collapsed this year? So, the two or three key drivers that will bring back your margin to 11%-12%. And my second question is on the German situation. I know you already talked about it in the past, during the Q1 call, but could you elaborate a little bit on what's going on there, and where the German margins are standing at the moment? Thank you.
Hi, Laurent. Can you repeat the end of the second question? Because, even if the line was not good, but I didn't get the end of your second question, please.
Yes. Yes, sorry. I'm calling from far away. It's on the German situation, the profitability of the German operation at the moment, and what is exactly happening in the region, and if you are now in losses, basically, for the whole region?
Okay. So I will quickly answer to the second question, and Uwe will answer the first one. Now, on the second question, as we said in April, it's not the whole Germany or the whole Central Europe region, which is at loss. It's specifically centered, concentrated on the infrastructure business, the former IDM, you know, in the previous reporting, if you like, in Germany, which is clearly a significantly loss-making operation. And the plan that has been negotiated with our social partners is targeted on that perimeter, on that scope. Okay, so we are, let's say, addressing straightforwardly the issue at stake on, which is on this perimeter. Okay? And we've got, you know, a variety of activities in the rest of Germany and the rest of Central Europe.
We've got activities in Central Europe, for example, in BDS, that have been developing very, very well over the years. On, you know, public sector, for example, in Germany, on the application side, is doing very well. So there are nice pieces of business elsewhere, but the problem is the profitability, the profitability of the infrastructure business in Germany, and this is exactly what we're tackling. Uwe, on the first question.
Hi, Laurent, good morning.
... on the first, on your first question, how, you know, what are the main ingredients to get from the circa 6% to the 11%-12%? I think that, that was your question. So, of course, one element we mentioned in this call as well is, of course, the German restructuring plan. You know, this alone will be 1%, in that same equation. And then the other element, the main other element, I would say, is really the business mix change, because as you know, that portfolio which today, the new portfolio, which is today about 51% growing to more than 65%, carries, of course, a much higher profitability, which we see already in the BDS, but also in the application portfolio. So this in itself is the second lever.
Thirdly, of course, as you know, we have a catch-up to do on the offshoring. This is the other big lever which we are pushing to materialize in our midterm plan.
Okay, great. Thank you.
Thank you, Laurent. Next one.
Thank you. Next question comes from the line of Mohammed Moawalla from Goldman Sachs. Please go ahead.
Great. Thank you very much. Good morning, Elie and Uwe. Can you just comment, you know, in your view, in terms of sort of the mix of the business, and I apologize, I missed the first few minutes of the call, the growth in the second quarter. And essentially, are you assuming that the kind of the rate of infrastructure decline in the business kind of remains elevated? And when do you expect to kind of cross over with sort of perhaps a bit more cyclical recovery in BNPS? And then secondly, in terms of the breakdown of the kind of the one-time charges you are taking, could you give us perhaps a bigger split of the different components?
And then lastly, just want to clarify that the North America kind of accounting update is still scheduled for the results, and you expect to get kind of a sign-off at the end of the month? Thank you.
Hi, Mo, and thank you for your questions. Uwe will take the first two questions. On the first question on the accounting review, I think I said it all in my presentation. This is the expectation, okay, to complete the process for the twenty-eighth of July. And as I said, the work of review is being finalized at the moment. At this stage, misstatements identified are not material, and the auditor's work is ongoing in parallel as part of the half year review, as we talked, but the completion of the process is targeted to be achieved for the results of the twenty-eighth of July. Uwe?
Morning, Mo, yeah. To your first question, which first element, indeed, what we are, you know, what we were surprised of at the end of Q2 is indeed the heavier decline in the infrastructure legacy business, which is, of course, as we said before, due to the accelerated move to the cloud of customers. Now, to your question around how does the future look like? I would say two elements, I would answer on that. One, of course, we are having a campaign and a plan in place to make sure that even on the legacy business, that, of course, we are gaining market share. We are also, you know, partners of our clients to move them to the cloud.
So therefore, we believe we can also arrest a bit the decline, which of course, the underlying decline will always be there, but I think we can grab more market share in that with a specific plan. But secondly, we are investing heavily in, and that's why we also put more investment in our plan now, to even be faster on the cloud acceleration and then to the move for our customers to the cloud. And perhaps lastly, on the BNPS business that you were alluding to, we see actually, and also in Q2 already, indeed, the turnaround of our BNPS business, including Syntel, back to growth, and this would also accelerate over the next quarters, and therefore help, of course, to mitigate any underlying decline of the legacy business.
To your second question, around the one-time charges, we will give more detail in our release call, so please, if you could wait for that, to give you also the more granularity.
Okay, great. Thank you.
Thank you, Mo. Next question.
Thank you. Next question comes from the line of James Goodman from Barclays. Please go ahead, James. The line is now open.
Good morning. Thank you very much. A couple from me. Just firstly, I mean, on the whole topic of the, you know, accelerated cloud transition, we've clearly been talking about this for some time. I'm just trying to understand a little bit the sort of incremental effects that you're seeing today. And maybe the way to answer that is just to go back a little bit to the structure of the IDM business. I remember, I think it was 2018, at the CMD, you gave a breakdown of that business, and I think only about 15% was classic data center. And I guess part of this sort of investment thesis has been that that's declined to a point where it can't affect the business to this magnitude.
So maybe you could help us with the sort of mix of the IDM business today, and you know, are you actually seeing growth in what you would describe as Atos cloud within that? What, where is this effect kind of getting shown out in the IDM business? And then just secondly, unrelated, but on the cash flow bridge, what's the EUR 200 million reduced customer advance payments? Could you give us a little bit more insight into why you're doing this? Something that appears, I guess, the way you present it, voluntary, at a time when the cash flow is being pressured by the profit effects of today's update? Thank you.
Hi, James. Just to start answering the first part of your first question, then I'll hand over to Uwe. Yeah, of course, I mean, the cloud is growing for years now. But what is at stake now, what is happening now, is post-COVID a very strong acceleration of the move to the cloud. You've got you know the study by, I don't remember the source exactly, last week showing, and this is exactly what we see on the market, that 65% of the CIOs. You have 65% more CIOs willing to move to the cloud than before the crisis. So you see that it's a real very very strong acceleration post-COVID.
I mean, which is, which is welcome for the companies, their digitization, et cetera, but we need to have the right structure of our business. So we were on that way, but we need to accelerate ourselves to make sure that we grab the landing zone, as we say, of the infrastructure people in the cloud. Okay? So Uwe?
Yeah. James, on the structure of the IDM business, you're correct. There is the data center business, which already declined from your 15% two, three years ago. But we also have pieces like the unified communication portfolio, or part of the network business, which are, of course, in a similar situation. So therefore, these are also affected by the move to the cloud. We'll be, of course, more specific and give you also more data on the earnings call on the twenty-eighth, how the pieces are developing. On the second point around the advance payment, and yeah, thanks for your question.
On this one, here, our let's say surprise in the Q2 close was that indeed, we collected less advance payments from our clients than what we expected. Now, when we analyze that and also looking into the future, what I saw and what led us to the decision to take down that amount, is that our salespeople are focusing too much on trying to get advance payments from customers instead of selling. So therefore, we're also saying it is probably better to take that down a bit and not to over-focus on that, and let our salespeople really focus on selling to our customers.
Okay, thank you. But do you, can you tell me how much of the IDM business is Atos Cloud? I'm just thinking about the, you know, the competition versus the hyperscalers there and trying to sort of think about the growth rates of the parts within IDM. Or should we talk about that with the results?
Sorry, James, you mean the portion of our IDM business, which is subject to-
Which is your growing cloud business? Yeah, that's just what I'm trying to focus on.
Yeah. So that's about 30% of the IDM business, which is affected by that.
Thank you.
Thank you, James. Next question, please.
Thank you. The next question comes from the line of Gianmarco Conti from Deutsche Bank. Please go ahead.
Good morning. Hi. Yeah, thanks for taking my question. Most of mine have actually been answered, but maybe in, on the back of the last question, could you perhaps just give kind of some color and even maybe some examples on what exact portion of legacy business that you actually lost? I'm basically trying to see if there's any read across here, understanding, you know, if it's something that's like more structural or if it's just like, you know, a portion of business which customers are quickly trying to shift to cloud as opposed to remaining with Atos.
Yeah. The you've got two types of impact. You've got a reduction of the volumes of the workloads on the legacy infrastructure business, because they are moving much faster to the cloud. So the workloads which were fueling our infrastructure are getting lower, the legacy infrastructure. And we've got another impact, which is on what, you know, we call utilization, which, you know, we estimate in general that we have between 10% and 15% on top of the base contracts of infrastructure in projects, additional projects, and we have much less projects requested by the customers. So we've got the two impacts which are accumulating. Uwe, you want to add anything? No.
Right. So, what is the typical project that you've kind of, like, lost? Could you just, like, give, like, one simple example, or, like, a few if you have in mind? I'm just trying to understand what exactly has it been lost in terms of IDM.
Would be, let's say, deployment of new servers in data centers, you know, in their private cloud data centers, which of course, right now, customers would hold off until they migrate to the cloud, as an example, right? So you typically have a lot of projects in the classical data center space, which is now not happening or happening in the cloud. Right. Okay, thanks a lot.
No, thank you.
Thank you.
Next question, please.
Thank you. Next question comes from the line of Neil Steer from Redburn. Please go ahead, Neil. The line is now open.
Good morning, thanks. Can you hear me okay?
Yes. Hi, Neil.
Hi, good morning. Most of my questions have been asked and answered, but so just one sort of clarification. Over the course of the last sort of 12-18 months, you've obviously changed the format that you report in, but when you last broke out the margin of the IDM business, it was close to a 10% margin business. So based upon the margin reset for 2021 that you're highlighting today, it would imply, all other things being broadly equal, that the IDM business is now close to zero margin. And I'm just, I mean, really, can you comment on that? Has this business gone from sort of close to double-digit margins down to zero in the space of 12 months? Is that really what you're saying for the current year?
So indeed, I mean, Neil, good morning. Indeed, we have a decline in the margin of the IDM business, because as you rightfully think, BDS business is roughly stable from a margin perspective, and the BNPS business is slightly going up. But indeed, you know, the 30% of that business, which is, you know, declining and heavily declining, of course, also is reducing the margin rate.
Okay. Thank you, Neil. Next question, please.
Thank you. The next question comes from the line of Amit Harchandani from Citi. Please go ahead, the line is now open.
Thank you. Morning, all. Amit Harchandani from Citi. Two questions, if I may. My first question goes back to the topic of advance payments, and I think the comment made earlier that salespeople were more focused on advance payments than selling. To me, EUR 200 million looks quite a lot in the context of your overall free cash flow, particularly given that we are halfway through the year. Could you elaborate a bit upon this focus on advance payments? Is it across business lines? Is it IDM? What exactly is changing? How does that compare to industry practices? It's just the magnitude seems quite a lot in the context of your overall free cash flow generation, please. And I have a second question.
Yeah, go ahead with your second question, Amit.
Sure. My second question is with regards to the improvement across KPIs, which is expected to start twenty twenty-two. Could you give us a sense for how we should think about any exceptional charges, please? Would that be around or below 1% of revenue as previously guided? Thank you.
Uwe?
Hi, Amit. Yeah, so to your first question, I mean, yes, of course, by type of business, just very shortly, I mean, on the, let's say, the more milestone type of business, like our big data security business and so on, of course, advance payments are part of the equation and need to be, and so on. What I'm talking about is, salespeople really focusing on, yes, cash collection and making sure we get paid, but not spend time, on topics which are then trying to collect additional cash. So it's really about the more the other business, but on the milestone business, of course, advance payment is a critical part. So this is important.
To your second question on the, I would say, restructuring, rationalization, and integration costs, as we said before, we will have an increased percentage of revenue this year, including the German plan, and will go down to below 1% starting next year. So this is indeed the plan, and that's why we also pull forward and make sure we have all the charges for the German restructuring plan in the 2021 books.
Thank you, Uwe. If I could clarify on the answer to the first question, please. This impact on advance payments, is it fair to say all of it would come through this year, hence the magnitude of EUR 200 million, and it should be normalized or certainly not an influencing factor next year?
Yeah. This, I think you can assume. Yes.
Thank you.
Thank you, Amit.
Next question, please.
Thank you. The next question comes from the line of Derric Marcon from Société Générale. Please go ahead, Derric, the line is now open.
Thank you very much. Good morning, guys. I've got three questions, if I may. The first one, can you talk about the signing of Q2, and how they look like? The second one is about the weight of the infrastructure management, because I struggle to reconcile the 30% that we mentioned. If I take the slide that you presented at your last capital market day, what you called at the time classic infrastructure or business, was 10% of the total revenue. So I'm just trying to understand what the percentage of that business is today versus what it was in 2019. And my last question is about the seasonality of your margin that you forecast between H1 and H2.
I understand with the new guidance that you don't see a big difference between H1 and H2, while before, you had a strong seasonality forecasted between H1 and H2. So I'm just here also struggling to understand what has changed in terms of seasonality between H1 and H2. Thank you.
I understand that, of course, the revenue growth that you forecast for H2 is lower than what you had before. But the guidance still assume H2 much stronger than H1, and so we could have thought that the margin seasonality between H2 and H1 will remain significant.
Okay.
On the order entry, we'll of course be more specific on the twenty-eighth to give you all the data on the earnings release.
I think to your second question on the seasonality, so indeed, we still have a seasonality even in our guidance, but we also, I mean, number one, are prudent, but number two, we are also trying to, yeah, let's say, reduce a bit the seasonality also in our business, and if you look at the application business, which is becoming stronger and stronger, there's less seasonality in that type of business.
Uwe, on the weight of the infrastructure,
Ah, yes. Sorry. Yeah, yeah, yeah, the second question.
That's it.
Yeah. Sorry, sorry, yeah. No, indeed, I mean, you're right. The data center part is now below 10%, so that's the classic data center part. But we also have the unified communication business, which, you know, when you remember that graphic that was not included, and also some network business, which then overall totals up to about 30% when you include all components in that business. All of them, of course, have a little bit different, you know, dynamics inside.
Very clear. Thank you.
Thank you, Derric. Next question, please.
A follow-up question from Michael Briest from UBS. Please go ahead, Michael. The line is now open.
Sure.
Yes, thank you. A couple of follow-ups for me. Just Uwe, on the exceptional items this year, I think it was €160 million mentioned in addition to the German restructuring around write-off of assets and loss provisions. Can you talk about the loss provision element of that? How much is the €160, and putting it all together for the year, what should we anticipate for exceptional items? And then also on the slides, the margin had an impact from recruitment and retention. Can you talk about what the challenges are there? And obviously, in India, we hear a lot of stories about sort of the war for talent. Can you maybe give an update on how you see your Indian workforce today? Thanks.
Yeah, Uwe, on the first one, I come back on the second one.
Yeah. Yeah, Michael, on, so we'll be more specific on the twenty-eighth, but, you know, your two questions, one is, yes, there's a portion in there for loss provisions on more infrastructure-related businesses. And secondly, we think that this is now behind us, meaning we took those charges in H1. So I don't expect, you know, more of that other than normal course of business, but nothing extraordinary.
So on your second question, Michael, yes, I think. I mean, this is in line with what you mentioned yourself in your question. There is clearly a strong tension on the labor market, on the talent market, I should say, in skills, especially in cloud skills, in digital skills, in cybersecurity skills, and so on. It happens in India. It is the case in the US, and it is, in fact, the case, different degrees, also in Europe and in the UK. So it's rather across the board, given especially the booming demand. So it's really, I would say, across the board, in particular in India and in the US.
Thank you. Uwe, the exceptionals for the year, how much will it be?
Sorry, I didn't hear.
The total exceptional charges for the year, when you put Germany and 160 to date.
We'll talk about that in, you know, in the earnings call.
Okay. Thank you.
Thank you, Michael. Next question, please.
Next question comes on the line of Nicolas David. Please go ahead, Nicolas.
Yes, hi. Hi, good morning, Elie. Good morning, Uwe. I have a couple of question from my side. Did you also see a deviation compared to your initial expectation in your fast-growing business? Not only could you share what was the growth of the big data and cybersecurity asset in Q2, and are you still very happy with this business? Second one is what were the most affected verticals compared to your initial expectation? And can you provide us some color on why some were maybe more affected than others? And last one is just a very close, very quick clarification, as you mentioned, yes, 1,300 people are concerned about German restructuring.
In IDM is out of what was the total head count in this targeted area of German IDM? Thank you.
Hi. Hi, Nicolas. So, on your first question, no, we are satisfied with our areas of growth. Again, I can only repeat that our issue that we're tackling, our challenge that we are tackling is
... that these areas are not big enough. So we have a business profile, business structure challenge that we are totally reshaping. That's the aim. But and, and, and we are, and I am even more motivated to do this because precisely, our growth business are doing very well. So taking big data, taking cybersecurity, taking cloud, taking, I mean, this is small, but decarbonization even, you know, so the-- to your first question, we're clearly growing and, and, and faster growing on, on, on, in those areas. And I could add, by the way, that the acquisitions are, you know, broadly speaking, doing very well. The, the, the thing that we need to do, we need to do more to really have a macro impact on the group, on the group financials. Sorry, the, the next question?
The second was more on the industry, so I think.
Yeah.
Nicolas, I mean, again, we will be more specific by industry on the twenty-eighth, but I mean, I would say we see good improvement in even in the manufacturing area, which was the main concern area, while we still have, you know, negative revenue development in the more utility space and in the retail space. So, and also public sector and defense is still, I would say, on a decline like in Q1, but we will be more specific on the twenty-eighth, and then I think the third question, your third question was on the restructuring in Germany.
So the 1,300 is roughly 25% of that population, in that space, for IDM, so about 5,000 people, roughly speaking.
That's very clear. Thank you very much.
Thank you. Thank you, Nicolas. So I think that was the last question. Okay, so-
Yes, no further question.
Yeah. Thank you very much for your participation and again, on short notice. Gilles, of course, and all of us remain available for you anytime. And in this format, we'll speak again on the twenty-eighth of July, where we will be able to give you much more details and go through the other, you know, transformation agenda items, as we said. Thank you very much for your participation. Have a good day.