London, June 28, Altran, the global leader in Engineering and R&D services (ER&D), today unveiled The High Road, Altran 2022, a new five-year strategic plan to elevate its service model and expand its footprint in key industries and geographies to meet client demand and powerful technological disruptions. The plan was presented to investors at a Capital Markets Day held in London.
The High Road, Altran 2022 will capitalize on the projected growth of the ER&D services market of c.9% per year between 2017 and 2022, from €155 billion in 2017 to €240 billion in 2022 with highly differentiated growth patterns across geographies and industries.
The ER&D market transformation is driven by:
With our new strategic plan, The High Road, Altran 2022, we will capitalize on the opportunities that lie ahead as client demand rapidly evolves. By expanding our footprint in fast-growing industries and geographies, and sharpening our service models, we will continue to elevate our growth profile while expanding our margins to new levels. Leveraging our first mover advantage, great talents and our extensive portfolio of services, we are positioned to become a preferred partner of the Top 1000 R&D global spenders with both high-value and R&D cost optimization services. We are delighted with the progress on the Aricent integration and client feedback; as we continue to execute we will deliver superior return to shareholders. Dominique Cerutti Chairman and Chief Executive Officer of the Altran Group
The High Road, Altran 2022 relies on three strategic axes:
The Group has also highlighted four operational enablers supporting the execution of the strategic plan:
The deployment of The High Road, Altran 2022 strategic plan is expected to generate:
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:
Strong drivers are supporting the expansion of the Group’s Free Cash Flow: (i) the increase in the operating margin including through synergies and cost savings, a capital intensity around 2% of Revenues, while working capital requirements will be commensurate with growth; (ii) Financial costs are expected to decrease over time as debt is repaid, while the Aricent cash commitments will decrease each year and end in 2021, finally the tax structure will be revamped and the group should benefit from an improving tax environment.
Altran has reconfirmed that on a standalone basis the Group had been on a growth and margin improvement trajectory that would have led to the achievement of the targets of its previous plan, Altran 2020. Ignition.