Net financial debt

Net fi nancial debt is the difference between Total fi nancial liabilities and cash and cash equivalents.

31/12/2009 31/12/2008

Cash and cash equivalent 242,572 229,463

Cash liabilities

Net cash 242,572 229,463

Convertible bond loans (> 1 year) 100,422

Credit establishment borrowings and debts (> 1 year) 92,414 13,474

Other non-current financial liabilities 17,925 9,392

Convertible bond loans (< 1 year)

Current bond loans 1,069 192,345

Current borrowings 35,792 1,209

Current financial debt on leasing contracts

Overdrafts (*) _{177,665 219,315}

Other current financial liabilities 2,579 1,988

GROSS FINANCIAL DEBT 427,866 437,723

NET FINANCIAL DEBT (185,294) (208,260)

(*) including factoring of €159.7m (for Total lines of €293.9m at end-2009 compared with €306.4m at end-2008).

Group net debt narrowed €22,966m on 2008 levels to €185,294k at end-December 2009.

Cash equivalents

At 31 December 2009, the market value of cash equivalents Totalled €198,630k and may be broken down as follows:

31/12/2009 31/12/2008

Certificates of deposit and other 90,000 40,008

SICAV* and mutual funds 108,630 107,982

Financial information concerning the company’s assets and liabilities,

fi nancial situation and fi nancial statements

20

Financial statements

Debt repayment schedule

The table below gives the breakdown of the group’s fi nancing costs by type of debt and by maturity, including accrued interest and after taking into account the effect of hedging instruments:

< 1 year 1 - 2 years 2 - 3 years 3 - 4 years 4 - 5 years > 5 years

Convertible bond loans (> 1 year) 100,422

Credit establishment borrowings and debts

(> 1 year) 31,789 31,922 28,703

Other non-current financial liabilities 2,758 13,239 1,037 782 109

Long term financial liabilities 34,547 45,161 29,740 782 100,531

Current bond loans 1,069

Current borrowings 35,792

Overdrafts 177,665

Other current financial liabilities 2,579

Short-term financial liabilities 217,105

TOTAL 217,105 34,547 45,161 29,740 782 100,531

In percentage terms, the maturity of the group’s fi nancial liabilities at 31 December 2009 may be broken down as follows:

•

less than 1 year: 50.74%;

•

1 to 5 years: 25.76%;

•

more than 5 years: 23.50%.

Convertible bond issues

On 18 November 2009, Altran issued 30,136,986 convertible bonds at a nominal value of €4.38, bearing an annual coupon of 6.72% and a maturity of 5 years and 44 days. The normal date of redemption is set for 1 January 2015.

Interest is payable in arrears on 1 January of each year. Interest is payable annually, either at the end of the period or on 1 January of every year. For the period running from 18 November 2009 au 31 December 2010, interest will be paid on 1 January on a prorata temporis basis.

•

The company can decide to redeem bonds before their scheduled

maturity date under the following conditions:

−

some or all of the bonds may be redeemed at any time by purchase on a securities market or over the counter or through a public offer;

−

all outstanding bonds may be redeemed at any time between 15 January 2013 and 1 January 2015:

−

at their face value plus all accrued interest since the last coupon date,

−

if the bond conversion ratio, multiplied by Altran Technologies average closing share price on Euronext SA’s Paris Premier Marché over 20 consecutive trading days, is more than 130% higher than the face value of the bond (i.e. €5.69). Note that the 20 consecutive-day period used to calculate the average closing share price is selected by the company out of a period of 30 consecutive trading days, prior to the announcement of the early redemption;

−

all outstanding bonds may be redeemed at any time at the early redemption price on the condition that the number of outstanding bonds is less than 10% of the Total amount issued.

•

Bondholders can:

−

exchange or convert their bonds before their scheduled maturity date at any time between the settlement date (18 November 2009) and the seventh working day before the regular or early redemption date;

−

request the conversion and/or exchange of bonds for shares at a conversion rate of 1 share for 1 bond. The company can decide whether or not to grant bondholders new and/or existing shares. The new shares issued following conversion will rank for dividend: on the fi rst day of the fi nancial year when the bonds are converted and will be immediately open for trading on the stock market;

−

exchange or convert their bonds at any moment in the event of a change in company control at an early redemption price equal to the par value plus the accrued interest due since the last coupon payment.

The application of IAS 32 to the 2015 OCEANE bond issue enhanced equity by €32.1m. Group fi nancial debt was reduced by the same amount.

The market rate applied and the breakdown of the debt and equity components are as follows:

•

discount rate applied to the debt: 12.83%;

•

effective interest rate: 13.63%;

•

fair value of the debt at date of issue: €99,851,000. Financial expenses for 2009 Totalled €1,640,000.

Accrued interest at end-2009, payable in arrears on 1 January 2011, came out at €1,069,000.

An additional expense of €571,000 booked in the income statement at 31 December 2009 resulted from the difference between the nominal value of the OCEANE bearing a 6.72% coupon and the IFRS fi nancial charge calculated on the basis of the effective interest rate method in compliance with IAS 32/39.

Note that the convertible bond, redeemable in January 2009 for an initial amount of €230m, was repaid in full on 2 January 2009.

120 2009 Registration Document

Financial information concerning the company’s assets and liabilities, fi nancial situation and fi nancial statements

20

Financial statements

Main changes in credit lines

On 4 July 2008, Altran signed a refi nancing agreement with its bankers (BNP Paribas, Crédit Agricole Ile de France, Natixis and Société Générale) giving the group access to Total credit lines amounting to €123.8m on 31 December 2009. The amortisation schedule for these credit lines is given in the table below.

This agreement gives Altran access to a fi ve-year €150m credit line, including the rescheduling of €26m in existing credit lines that were initially redeemable in 2009. The main characteristics of this credit line include:

•

fi ve-year maturity dating from the fi rst draw-down;

•

half-yearly amortisation as from July 2009;

•

a maximum Euribor coupon: Euribor coupon +2.25%. This new €150m credit line is divided into two tranches:

•

tranche A for a maximum of €26m made available as of 28 July 2008;

•

tranche B for the remaining €124m euro, which was made available as of 1 January 2009.

(€m) Dec. 2008 June 2009 Dec. 2009 June 2010 Dec. 2010 June 2011 Dec. 2011 June 2012 Dec. 2012 June 2013 Dec. 2013 Tranche A revolving credit 26.0 23.1 20.2 17.3 14.4 11.6 8.7 5.8 2.9 0.0 0.0 Tranche B revolving credit 124.0 111.6 99.2 86.8 74.4 62.0 49.6 37.2 24.8 12.4 0.0 TOTAL 150 134.7 119.4 104.1 88.8 73.6 58.3 43.0 27.7 12.4 0.0 Renegotiated credit

line with CADIF 5.0 5.0 4.4 3.8 3.2 2.6 2.0 1.4 0.8 0.2 0.0

TOTAL 155.0 139.7 123.8 107.9 92.0 76.2 60.3 44.4 28.5 12.6 0.0

A further amendment to the refi nancing agreement with the group’s bankers, determining new fi nancial ratio thresholds, was signed on 9 November 2009. Margin levels will be revised every six months according to consolidated debt leverage (net fi nancial debt/EBITDA).

Applicable margin Ratio >= 3,5 2.25% / year 3.5>ratio>3 1.40% / year 3>ratio>2.5 1.25% / year 2.5>ratio>2 1.10% / year Ratio<2 0.90% / year

These credit lines are subject to the following covenants:

Net debt/EBITDA Net debt/equity

31.12.2009 <4.5 <1.0 30.06.2010 <5.5 <1.0 31.12.2010 <4.0 <1.0 30.06.2011 <3.75 <1.0 31.12.2011 <3.0 <1.0 30.06.2012 <2.5 <1.0 31/12/2012 -31/12/2013 <2.0 <1.0

These fi nancial ratios are calculated on the basis of IFRS norms:

•

the EBITDA used to calculate these covenants is the 12-month

moving average before employee profi t-sharing and staff costs relative to payment in shares;

•

net fi nancial debt excludes employee profi t-sharing and accrued interest on bond-related debt.

The credit agreement contains several clauses pertaining to fi nancial ratio thresholds, allocation of cash fl ow and limitations on acquisitions, in particular:

•

as of 2009, one third of net consolidated cash fl ow over €15m generated by the group must be allocated to pay down debt (excluding any future market operation);

•

acquisitions are limited to a Total annual investment of €50m, unless the group obtains special permission from a majority of its lending banks.

Financial information concerning the company’s assets and liabilities,

fi nancial situation and fi nancial statements

20

Financial statements

Trends in the group’s fi nancial ratios in 2009 are given in the table below:

31/12/2009 31/12/2008

Net debt/equity as defined in the credit agreement 0.38 0.33

Net debt/EBITDA before employee profit-sharing (financial gearing)

as defined in the credit agreement 3.83 1.14

Most of the group’s bank debt is contracted on a variable-rate basis that is mainly indexed to the EURIBOR or EONIA benchmark rates, although a hedging strategy has been set up (see section 4 “Risks” of the registration document).

Fair value of interest rate swaps reduced shareholders’ equity by a net amount of €997,000 (corresponding to €1,671,000 in gross value terms, less €674 in deferred taxes).

4.12 Provisions for liabilities and charges

Trends in short and long-term provisions for liabilities and charges over the period are given in the table below:

31/12/2008

In document Registration Document 2009 (Page 120-123)