Assystem - Registration Document 2016

MANAGEMENT REPORT

BUSINESS OVERVIEW

3.1.2.2 Significant events of 2016

acquired a controlling interest in Envy, which has enabled the Group to enlarge its client portfolio in the nuclear sector and access the large Turkish market for engineering services. A low proportion of Assystem’s revenue also originates from the secondment of consultants specialised in Oil & Gas and Industry, essentially in the Middle East, Africa and Asia. This activity, known as “Staffing” in the engineering world, is mainly inherited from an acquisition carried out in 2012 (MPH Group) to which Assystem’s pre-existing staffing activities were added. The Group’s main market in the Staffing business – the Oil & Gas sector which accounted for some 75% of the Staffing business’s revenue in 2016 – was hit hard by the plunge in oil prices in 2015. Assystem is working to diversify its client portfolio in this business in response to this situation. 3.1.1.2 Assystem’s organisational structure Assytem is structured around two main divisions: Global Product Solutions and Energy & Infrastructure, which respectively accounted for 60.4% and 33.3% of consolidated revenue in 2016, and it also has a Staffing business which contributed 5.6% of 2016 consolidated revenue. 3.1.2.1 Business review Assystem’s consolidated revenue in 2016 amounted to €955.6 million, up 5.3% year on year thanks to strong performances in its three strategic business sectors – Aerospace, Automotive and Nuclear. At 31 December 2016, Assystem had 12,422 employees, an increase of 869 compared with 31 December 2015 (or 593 on a constant Group structure basis). The Company’s main employee-related information and more broadly, its Corporate Social Responsibility (CSR) actions and key indicators are provided in Chapter 4 of this Registration Document. 3.1.2 BUSINESS REVIEW AND SIGNIFICANT EVENTS OF 2016

GLOBAL PRODUCT SOLUTIONS (GPS) In the Aerospace sector, revenue increased 3.7% as reported (5.7% on an organic basis and at constant exchange rates), reflecting growth in business volumes related to manufacturing processes and the supply chain. During 2016 Assystem acquired Aerotec Concept, a well-established player in the airplane/helicopter refurbishment and customisation market (bespoke cabin fittings, avionics modifications and connectivity). This acquisition has rounded out the aerospace service offering of the GPS division. Growth in the Automotive sector continued at a brisk pace, with revenue climbing more than 25% in 2016 following on from the already strong increase reported in 2015. The cross-business organisational structure put in place in order to capitalise on the dynamic momentum in the European market proved a success and the number of engineers working at the Romanian engineering centre topped the milestone figure of 1,000 during the year. This centre can work remotely for a large number of clients, which therefore eliminates the issue of geographic distance. In late 2016, Assystem acquired UK-based Edison Technical Recruitment – a leading specialist engineering recruitment agency with a particular focus on electronics, electrical systems and software engineering and which is a preferred supplier for major players in the automotive industry. Through this acquisition Assystem’s GPS division will be able to strengthen its presence in the automotive sector in the United Kingdom. ENERGY & INFRASTRUCTURE (E&I) Revenue for the Nuclear sector rose solidly excluding the effect of a contraction in business with the Areva Group. Growth was driven by business with EDF in France and Enec in the Middle East, as well as by operations related to the ITER project. Other E&I activities (transport and building infrastructure, conventional energy and life sciences) remained stable, with the increase in revenue in Europe offset by a contraction in business volumes for Radicon due to a capital expenditure freeze for infrastructure projects in Saudi Arabia.

3

37

ASSYSTEM

REGISTRATION DOCUMENT 2016