Reference - zonebourse.com · reference document and have read through the whole document.” ... de la Comptabilité), the measures undertaken to reinforce the ... 12/31/2005 S1

Referencedocument

2006

ALTRAN TECHNOLOGIESS.A. à Directoire et Conseil de Surveillance

Capital : 58.658.118,50 euros

Headquarters58 boulevard Gouvion Saint-Cyr - 75017 PARIS

702 012 956 RCS Paris

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1 Persons in charge 5

2 Statutory Auditors 6

3 Selected fi nancial information 7

4 Risk factors 8

5 Information on Altran 13

6 Information concerning the Group’s activities 16

7 Organisational chart 20

8 Real-estate properties, Plants and equipment 21

9 Overview of the fi nancial position and results (management report) 22

10 Treasury and capital 35

11 Research & Development 36

12 Information on trends 37

13 Forecasts 38

14 Administration, management and supervisory units 39

15 Remuneration and benefi ts 52

16 Operation of management and supervisory units 57

17 Employees 58

18 Main shareholders 61

19 Transactions with related entities 66

20 Financial information concerning the issuer’s assets, fi nancial position and results 67

21 Additional information 139

22 Major contracts 145

23 Information provided by third parties, declarations by experts and declarations of interests 146

24 Documents accessible to the public 147

25 Information on participating interests 148

Appendixes

Appendix 1 : Internal control 149

Appendix 2 : General Assembly of Shareholders 29 June 2007 156

Appendix 3 : Statutory auditors’ report 171

This reference document was submitted to France’s fi nancial market authority (Autorité des Marchés Financiers) on 7 june 2007 in compliance with Article 212-13 of the general regulations of the Autorité des Marchés Financiers. It may be used to support a fi nancial

transaction if accompanied by a transaction memo validated by the Autorité des Marchés Financiers.

2006 Reference Document

“In application of article 28 of the European Commision’s regulation (CE) no. 809/2004, the following information has been included in the reference document:

The report on activities, the corporate accounts, the Statutory Auditors’ general report, the consolidated accounts, the Statutory Auditors’ report on the consolidated accounts and the Statutory Auditors’ report on agreements concluded by Altran Technologies S.A. in 2005 and referred to in article L. 226-10 of the French Commercial Code as presented on pages 60 to 150 of the reference document fi led with France’s Financial Markets Authority (Autorité des Marchés Financiers) on 29 May 2006 under the number D.06-0488;

The report on activities, the corporate accounts, the Statutory Auditors’ general report, the consolidated accounts, the Statutory Auditors’ report on the consolidated accounts and the Statutory Auditors’ report on agreements concluded by Altran Technologies S.A. in 2004 and referred to in article L. 226-10 of the French Commercial Code as presented on pages 36 to 150 (inclusive) of the reference document fi led with France’s Financial Markets Authority (Autorité des Marchés Financiers) on 14 June 2005 under the number R.05-091.

The reference documents mentioned above are available on the AMF website (www.amf-france.org) and on the issuer’s website (www.altran.com).

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This is a non-bidding free translation into English of the original French text and is provided solely for the convenience of English speaking users.

4 2006 Reference Document


STATEMENT ON BEHALF OF THE PERSON IN CHARGE OF THE REFERENCE DOCUMENT

“We hereby declare, after having taken all reasonable precautions to that end, that the information contained in this reference document, to the best of our knowledge, is true and sincere and contains no irregularities likely to affect its interpretation

We have obtained an end-of-mission statement from the Statutory Auditors in which they indicate that they have verifi ed all information concerning the fi nancial position and accounts presented in this reference document and have read through the whole document.”

Historical fi nancial information presented in this reference document has been the subject of reports from the statutory auditors.

Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the consolidated accounts for the fi nancial year ended on 31 December 2006, shown on page 171/172 of this reference document, draw attention to:

Note 6 to the fi nancial statements “Major litigation and contingent liabilities”;

the measures taken to strengthen the Group’s internal control and accounting information systems presented in the report of the Chairman of the Supervisory Board, prepared in accordance with the provisions of the last paragraph of Article L.225-68 of the French Commercial Code (Code de Commerce).

Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the corporate accounts for the fi nancial year ended on 31 December 2006, shown on page 173/174 of this reference document, draw attention to:

Note 5 to the fi nancial statements “Information on major ongoing litigation”;

Note 4.8 to the fi nancial statements on the accounting impact of merger operations during the fi nancial year;


Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the consolidated accounts for the fi nancial year ended on 31 December 2005 inserted in the reference document for fi nancial year 2005 fi led with France's Financial Markets Authority (AMF) on 29 May 2006 under the no. D.06-0488 and referred to in this reference document, draw attention to:

note 6 to the fi nancial statements "Monitoring of signifi cant legal disputes and possible liabilities",

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the measures undertaken to reinforce the group's internal control facility and accounting information system presented in the report from the Chairman of the Supervisory Board, drawn up in application of the provisions in the fi nal paragraph of article L. 225-68 of the French Commercial Code,

note 4.11 to the fi nancial statements "Net fi nancial indebtedness" specifi es the consequences on balance sheet presentation and on non-operating revenue and expenses of application as of 1 January 2005 of IAS 32.

Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the annual accounts for the fi nancial year ended on 31 December 2005 inserted in the reference document for fi nancial year 2005 fi led with France's Financial Markets Authority (AMF) on 29 May 2006 under the no. D.06-0488 and referred to in this reference document, draw attention to:

note 2.12 in the notes to the annual accounts "Provisions for contingencies and charges",

note 2.16 in the notes to the annual accounts "Signifi cant outstanding legal disputes",

note 2.1 in the notes to the annual accounts setting out the change in method leading to the accounting entry, as of 1 January 2005, of pension commitments in the form of provisions, in accordance with the preferential method advocated by recommendation 2003-R01 of France's Council of Accountancy (Conseil National de la Comptabilité), the measures undertaken to reinforce the group's internal control facility and accounting information system presented in the report from the Chairman of the Supervisory Board, drawn up in application of the provisions in the fi nal paragraph of article L. 225-68 of the French Commercial Code. "

Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the consolidated accounts for the fi nancial year ended on 31 December 2004 inserted in the reference document for the fi nancial year 2004 fi led with France's Financial Markets Authority (AMF) on 14 June 2005 under the number R.05-091 and referred to in this reference document, draw attention to the following points set out in notes 3.2, 4.12, 5.4, 5.5.1. and 5.5.2. in the notes to fi nancial statements concerning:

changes in the internal control environment (3.2);

sector-based information (4.12);

legal and statutory procedures in progress (5.4 and 5.5.1);

the corporate governance system (5.5.2).

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1 Persons in charge


2 Statutory Auditors

Notwithstanding the opinion expressed by them on the accounts, the statutory auditors, in their report on the annual accounts for the fi nancial year ended on 31 December 2004 inserted in the reference document for the fi nancial year 2004 fi led with France's Financial Markets Authority (AMF) on 14 June 2005 under the number R.05-091 and referred to in this reference document, draw attention to the following points set out in notes 2.13, 2.15 and 2.16 in the notes to fi nancial statements concerning changes in:

the internal control environment (2.13);

legal and statutory procedures in progress (2.15);

the corporate governance system (2.16).

Mr. Yves de Chaisemartin – Chairman of the Board of Directors

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FULL STATUTORY AUDITORS

Mazars & GuérardRepresented by Mr Guy Isim at Mirin and Mr Jean-Luc Barlet

Tour Exaltis – 61 rue Henri-Regnault

92075 La Défense cedex

First appointed: 29 June 2005

Mandate expires: At the Ordinary General Meeting held in 2008 in order to approve the accounts of the 2007 year end

Deloitte & AssociésRepresented by Mr Henri Lejetté

185 avenue Charles-De-Gaulle

92524 Neuilly-sur-Seine cedex



PEOPLE IN CHARGE OF FINANCIAL INFORMATION

Mr Eric AlbrandMember of the Board of DirectorsTel: + 33 (0)1 46 17 49 69 E-mail: comf i @altran.com

Mr Laurent Dubois Person in charge of investor relationsTel.: + 33 (0)1 46 17 49 69 E-mail: comf i @altran.com

SUBSTITUTE STATUTORY AUDITORS

Mr Jean-Louis LebrunTour Exaltis – 61 rue Henri-Regnault

92075 La Défense cedex



Cabinet BEAS 7-9 Villa Houssay

92524 Neuilly-sur-Seine cedex


Mandate expires: At the Ordinary General Meeting held in 2010 in order to approve the accounts of the 2009 year end.


Turnover for 2006 are up 4.2%, at 1,495.4 million euros a compared to 1,434.5 million euros in 2005.

(in millions of euros)

12/31/2005 S1 2006 S2 2006 31/12/2006

IFRS IFRS IFRS IFRS

Turnover 1,434.5 745.9 749.5 1, 495.4

Current operating income 93.2 48.9 27.1 76.0

As a percentage of turnover 6.5% 6.55% 3.6% 5.1%

Non-recurring operating income (37.9) (12.1) (2.6) (14.7)

Goodwill amortization (26.4) (4.6) (11.3) (15.9)

Operating income 28.9 32.1 13.3 45.4

As a percentage of turnover 2.0% 4.3% 1.8% 3.0%

Cost of net debt (21.9) (11.5) (11.6) (23.1)

Other financial gains and expenses (0.7) (0.8) (2.2) (3.0)

Income tax expenses (6.1) (11.8) (3.9) (15.7)

Net earnings 0.2 8.2 (4.5) 3.7

Minority interest 0.1 (0.2) (0.1)

Group net earnings 0.2 8.1 (4.3) 3.8

Operating earnings for 2006 stand at 45.4 million euros after inclusion of re-structuring costs in the amount of 23.4 million euros as the result of a cost-cutting plan.

The Group has recorded goodwill in the amount of 15.9 million euros.

Financial earnings (-23.1 million euros) are on par with the Group’s debt.

The Group’s net earnings stand at 3.8 million euros for 2006.

The Group’s net debt, established according to IFRS standards, represents 379.9 million euros at 31 December 2006 as compared to 336.9 million euros at 31 December 2005. The increase in net debt is mainly linked to the evolution of client receivable accounts. At 31 December 2006, the Group had surpassed one of the fi nancial ratios agreed to. The Group’s banks have accepted to modify the Group’s ratios.

Cost-cutting plan

The Group’s indirect costs, representing 28% of turnover, remain high and the Group has therefore launched a programme intended to at least reduce the main general expense items by at least 3 points by the start of 2009 and establish better professional practices on a mid-term horizon. More detailed information on this programme will be presented at the next General Meeting of Shareholders in June 2007

Perspectives

In 2006, the Group underwent some major changes:

a reduction in the number of legal entities;

a re-structuring of the offer per market that better serves its customers;

a gradual enhancement of its offer that is more suited to the changes of the consulting and innovation market.

These changes should enable Altran to increase its turnover more rapidly in 2007.

The second direction is a priority and will involve a reduction of general expenditure in order to improve the Group’s profi tability.

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3 Selected fi nancial information


Test date Consolidated gearing ratio (1) Consolidated financial leverage ratio (2)

31 December 2004 1.40 5.0

31 December 2005 1.15 3.5

31 December 2006 1.00 3.0

31 December 2007 1.00 2.5

31 December 2008 1.00 2.0

31 December 2009 1.00 2.0(1) Gearing = Net financial debt/consolidated equity capital.

(2) Consolidated financial leverage ratio = Net financial debt/EBITDA excluding employee profit-sharing.

These two ratios are based on two contractual notions which are the net fi nancial debt and the EBITDA net of employee profi t sharing , defi ned as follows:

Net fi nancial debt = debt net of employee profi t sharing and accrued interest on bond debt;

EBITDA net of employee profi t sharing = Gross operating surplus net of employee profi t sharing.

Given the application of IFRS/IAS accounting standards since 1 January 2005, the method used to calculate the fi nancial ratios has been modifi ed accordingly as agreed to by the Group’s banks.

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The maximum fi nancial ratios presented here above remain unchanged.

At 31 December 2006, the Group had not met the previously defi ned ratios. In a letter dated 12 March 2007, it therefore requested that its banks modify the ratios applicable at 31 December 2006 as follows:

Net financial debt/equity capital 1.1 maximum

Net financial debt/EBITDA before profit-sharing 3.5 maximum

4 Risk factors

4.1 LIQUIDITY RISKS 8

4.2 INTEREST RATE RISKS 9

4.3 FOREIGN EXCHANGE RISKS 10

4.4 RISKS RELATED TO INTANGIBLE ASSETS 10

4.5 ENVIRONMENTAL RISKS 10

4.6 LEGAL RISKS 11

4.7 RISKS RELATED TO THE MANAGEMENT OF CONVERTIBLE BOND DEBT (OCEANE) 11

4.8 ACTIVITY-SPECIFIC RISKS 11

4.9 RISKS RELATED TO SHARES 12

4.1 LIQUIDITY RISKS

On 22 December 2004, the Group concluded a transaction for lines of credit in the amount of 150 million euros with its three main banks (BNP Paribas, Crédit Agricole Ile de France and Société Générale).

This agreement is the result of commitments made by these banks when the share capital was increased in December 2003.

To maintain these lines of credit, the Group’s must meet the following fi nancial ratios:


4Risk factors

In a letter dated 29 March 2007, the Group’s banks confi rmed that they will amend the fi nancial ratios at 31 December 2006.

The Group’s fi nancial ratios at 31 December 2006 are as follows:

Net financial debt/equity capital 0.99

Net financial debt/EBITDA BEFore profit-sharing 3.08

Within the context of this credit agreement, the Group has made other commitments toward the three banks involved which mainly include the following:

the amount used to fi nance new acquisitions is capped at 30 million euros per corporate year;

asset disposals may not exceed 10 million euros per corporate year to the exception of authorised disposals.

The Company is not bound by any other major covenants with regard to the lines of credit used.

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The Group’s mid-term lines of credit are amortised as follows:

Dec. 2005 June 2006 Dec. 2006 June 2007 Dec. 2007 June 2008 Dec. 2008 June 2009 Dec. 2009

CADIF fixed rate 16,493 14,334 12,112 9,826 7,473 5,053 2,562 0 0

CADIF variable rate 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

BNP Paribas variable rate 32,000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 0

SG variable rate 32,000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 0

Total 120,493 105,334 90,112 74,826 59,473 44,053 28,562 13

We would like to recall that there are no covenants affecting the 2009 convertible bond issue of July 2004.

Please note that the Group considers its debt level to be too high and that the necessary measures will be taken to eventually reduce this debt. This debt is mainly comprised of assigned receivables and the OCEANE 2009 which is to mature on 1 January 2006.

Given the up-and-coming launch of the cost-cutting plan, it appears that the Group is in need of additional resources if it is to ensure the proper execution of this plan and the repayment of the convertible bond loan. The Group is working at fi nding a means of re-fi nancing the 2009 maturity in the best possible conditions. The Group would like to establish this re-fi nancing during 2007.

4.2 INTEREST RATE RISKS

At 31 December 2006, the Group’s net debt represented 379.9 million euros and is mainly comprised of a convertible bond loan in the amount of 230 million euros with a fi xed interest rate of 3.75%, repayable 1 January 2009.

A fl uctuation in interest rates is therefore of little signifi cance and the Group has not established a policy to hedge interest rate exposure.

Elements pertaining to the repayment schedule of loans and fi nancial debt are presented in the following table.

(in millions of euros) Less than one year 1-5 years More than 5 years

Financial liabilities (219.3) (286.8) -

Financial assets 126.2 - -

Net position before management (93.1) (286.8) -

Off-balance sheet (exchange rate cover contract) - 60 -

Net position after management (93.1) (286.8) -

Interest rate risks


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4.3 FOREIGN EXCHANGE RISKS

Most of the Group’s foreign-currency assets are equity interests in non-Euro zone countries (mainly the United States, Brazil, the United Kingdom, Sweden and Switzerland).

There is no outstanding debt in foreign currencies at 31 December 2006.

In 2006, the Group recorded turnover in the amount of 310.0 million euros in non-Euro zone countries. The Group’s income and charges related to intellectual services provided to customers are recorded in the same currency and the Group has not established a policy to hedge foreign exchange exposure.

(in thousand euros)

Currency Assets Liabilities Net positionClosing value

at 31/12/2006

Net euro position

before management

Off-balance sheet

Net euro position

after management Sensitivity*

USD

GBP 0 (16,600) (16,600) 0.6715 (24,720) - (24,720) (247)

CHF

SEK

SGD

* Sensitivity to a 1% variation in the currency.

4.4 RISKS RELATED TO INTANGIBLE ASSETS

Goodwill is not amortised but is subjected to impairment tests at 31 December each year and at the time of any interim accounts if there is any indication of depreciation.

The methodology applied to value tests is presented in further detail in the appendices of the consolidated accounts, paragraph 1.7. “Goodwill”.

Depreciation recognised in the income statement represents 15,880 thousand euros for 2006, thus 4,622 thousand euros for the fi rst half-year of 2006 and 11,258, thousand euros for the second half-year of 2006.

The depreciation recognised involved 8 cash-generating units (CGUs). The net book value before deprecation recorded in 2006 under goodwill stands at 507,825 thousand euros.

When conducting impairment tests on goodwill at 31 December 2006, a WACC of 8.38% was used, thus a pre-tax discounting rate of 10% to 11%.

Results adjusted according to a sensitivity level of 9.38% would have resulted in value depreciation in the amount of 28,262 thousand euros.

4.5 ENVIRONMENTAL RISKS

Altran Technologies is an intellectual services company. Risks related to the Environment are therefore low.

Risk factors

Environmental risks


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4.6 LEGAL RISKS

Altran Technologies mainly invoices services according to the time a consultant spends on a task. With regard to its activities, the Group may become involved in legal actions of a corporate or any other nature. Whenever the Group defi nes a risk, a conservative provision is made based on the opinion of its advisors.

A description of any major disputes involving the Group is presented in paragraph 6 of the appendices of the consolidated accounts.

The total of provisions intended to cover all of the Group’s legal disputes represented 18.9 million euros at 31 December 2006.

To the company’s knowledge, there are no other legal disputes, arbitrations or unusual events other than those mentioned in paragraph 6 of the appendices of the consolidated accounts likely to have a signifi cant impact on the Group’s fi nancial position and assets.

The company would also like to draw attention to the press release entitled «The Altran group has acknowledged the decision of the AMF’s disciplinary committee» of May 31, 2007 reproduced in section 24 on page 147 of this document.

4.7 RISKS RELATED TO THE MANAGEMENT OF CONVERTIBLE BOND DEBT (OCEANE)

The Group feels that its debt level is still too high and intends to pursue efforts to improve its balance sheet. This will require:

a gradual improvement of the operating margin;

control of customer accounts. The Group considers that the latter element is still signifi cant;

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a continued policy of centralising cash assets;

continued assignment of trade receivables: at 31 December 2006, the Group had assigned 159 million euros in client receivables.

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4.8 ACTIVITY-SPECIFIC RISKS

Altran Group customers are mainly European private or public sector corporate accounts. Given its strategic importance, the detailed list of the Group’s customers will not be included herein. However, it can be said that the Group’s customer base is quite uneven as the fi fty most signifi cant customer accounts represent 39.4% of all turnover for 2006. Companies of the Altran Group invoice most of their services according to time spent at a fi xed price.

They are therefore limited to an obligation of means. For fi xed-price contracts, accounting principles for the recognition of income require that the risk of the contract being terminated be appraised and the margin is not recorded unless there are certain factors indicating that it will not be adversely affected by an obligation of due diligence.

Risk factors

Activity-specific risks


4 Risk factors

Risks related to shares

4.9 RISKS RELATED TO SHARES

Most cash assets are invested in:

Money market funds (SICAV);

marketable debt securities;

remunerated foreign currency accounts (GBP/USD).

All of these investments are remunerated according to the daily money market rate applicable, or the Libor rate for foreign currencies. The sensitivity of these investment, based on a 10% fl uctuation of the benchmark index (EONIA or LIBOR), is 0.20%.

A procedure is underway to defi ne rules governing the use of the Group’s cash assets by the subsidiaries and on a central level.

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Most of the guidelines revolve around two main principles:

all cash surpluses are to be exclusively invested with the Group (GMTS);

when allocating this cash, the GMTS gives priority to the repayment of credit and/or invests in money market securities with a volatility rate of less than 1% per annum.

At 31 December 2006, the Group owned investment securities for a market value of 54,7 million euros.

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5.1 HISTORY AND EVOLUTION OF THE COMPANY

5.1.1 Company name

Altran Technologies S.A.

5.1.2 Issuer’s place of registration and registration number

Registered in Paris under the no. 702 012 956

Siret code: 702 012 956 00042 NAF code: 742C

5.1.3 Date formed and term:

The company was formed 14 February 1970. Notwithstanding a premature dissolution or a prolongation granted by law or by the articles of association, the company’s term will expire 14 February 2045.

5.1.4 Issuer’s registered offi ce and legislation

Registered office: 58, boulevard Gouvion-Saint-Cyr – 75017 Paris

Administrative headquarters: 2 rue Paul-Vaillant-Couturier – 92300 Levallois-Perret

Legal form: a French, limited company with a Management Board and a Supervisory Board (société anonyme à Directoire et Conseil de surveillance)

Issuer’s legislation: A French, limited company governed by the French Commercial Code and all subsequent texts pertaining to commercial companies.

5.2 INVESTMENTS

5.2.1 Main investments

As mentioned in detail on pages 14, 15, 101, 113 and 114, acquisitions made during previous years with earn-out contracts will result in cash outfl ows over the next few years.

There were no acquisitions made during 2006.

5 Information on Altran

5.1 HISTORY AND EVOLUTION OF THE COMPANY 13

5.1.1 Company name 13

5.1.2 Issuer’s place of registration and registration number 13

5.1.3 Date formed and term 13

5.1.4 Issuer’s registered office and legislation 13

5.2 INVESTMENTS 13

5.2.1 Main investments 13

5.2.2 Main investment decisions made by the company’s management units 15


5 Information on Altran

List of acquisitions made over the last five financial years

2002 2003 2004 2005 2006

Company Country Company Country Company Country Company Country Company Country

CHS Germany Aktiva VIP Holding Netherlands

Little Acquisition Co. Hong Kong and Little Acquisition Co. Singapore

Hong Kong and Singapore

Little Dacee GermanyCQ Consulting GmbH Austria Little Brazil Brazil

ADL Germany GmbH Germany C Quential SRL Italy Consultores CA Venezuela ADL Austria GmbH Austria CQ Consulting GmbH Austria ADL Benelux Belgium Belgium Media Consultores Spain Invall Spain Barnaz Holding Spain C-Quential Spain Spain ISEAC Spain USM Spain Little France France C-Quential France France Dominique Malsch France Little Italy SRL Italy Wiseina Ltd Japan ADL Japan Inc Japan CQ Yuhan Hosea Korea Little Acquisition Co. Korea Korea Hilson Moran United Kingdom CCL United Kingdom ADL UK Ltd United Kingdom Lilla Bomen Consultant Sweden ADL Sweden Sweden Whom Ltd Switzerland ADL Schweiz Switzerland Sea USA Imagitek USA Global N Portugal

Investments


5Information on Altran

Cash outfl ows for acquisitions (initial payment and earn-outs ) are presented for each of the past three years:

in millions of euros

2003 2004 2005 2006

100.8 17.6 22.7 41.1

5.2.2 Main investment decisions made by the company’s management units

In 2007, the Group will continue to make investments within the scope of its transformation project which involves:

bringing the IT infrastructure up to standard (ERP, networks, etc.);

developing communications and collaboration tools (Group intranet, knowledge management tools);

streamlining the trademark policy

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Investments


Altran aims to be there for its customers throughout the life cycle of a product or a service, from the design or manufacturing phase to the optimisation of the production processes. The expertise of Altran’s teams is therefore quite varied and covers all engineering trades.

Since its inception, Altran has had the desire to work alongside its customers when defi ning, creating and following up on their strategic scientifi c or technological projects. Altran’s teams are involved in all phases of the life cycle of a product or service.

The Group’s ability to master a technology and transfer that technology from one industry sector to another is a cornerstone of the Group’s strategy and its offer. This unique approach to technological innovation and an ability to “desegregate” scientifi c procedures are the reasons customers choose Altran above all other partners. Innovation is now more than just a barrier to be overcome by industrials. Over the years it has become a key element of our customers’ strategies. A product or service can be clearly differentiated from the others thanks to innovation.

More than just a means of differentiation for Altran customers, innovation now represents the very core of their strategies that will now provides a means of growth and serve to conquer the market.

6.1 MAIN ACTIVITIES 16

6.2 MAIN MARKETS 16

6.2.1 The technologies and R&D consulting market 17

6.2.2 Organisation and information systems consulting 17

6.2.3 Strategy and management consulting 18

6.3 COMPETITION 18

6.1 MAIN ACTIVITIES

Breakdown of Altran’s Turnover by activity

2005 2006

9 %

13 %

31 %47 %

8 %

19 %

30 %43 %

Technology and R&D Consulting

Organisation and Information Systems Consulting

Strategy and Management Consulting

Various

6 Information concerning the Group’s activities


6Information concerning the Group’s activities

The Group is present on three main markets:

technology and R&D consulting;

organisation and information systems consulting;

strategy and management consulting.

6.2.1 The technology and R&D consulting market

In 2005, the technology consulting market was estimated at around 55 billion euros in the United-States and in Europe (Source: Pierre Audoin Consultants Altran positioning study 2005). In terms of size, the technologies consulting market can be compared to the management consulting market.

83,2 Md

123,7 Md$

Western Europe United States

Management Consulting

Organisation and Information Systems Consulting

Technology and R&D consulting

20,7

44,9

17,636,1

52,0

35,6

Source: PAC Altran positioning study 2005 & Altran Global Strategic Marketing.

Altran is the the European leader in technology consulting in terms of turnover recorded for this activity. It is important to note however that the market is still affected by a very segmented offer as among the three main European market players (Germany, France and the United Kingdom), the top-ten players only represent 30% to 40% of the market. As for Altran, it owned a market share of around 9.8% in France and of 1.5% to 5% in the other European countries for 2005 (Source: Altran Global Strategic Marketing).

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Technology Consulting Markets in Western Europe in 2005

4,44 4

1,41,2 1,2 1

0,7 0,6 0,5 0,4 0,2

Germany UnitedKingdom

France Italy Netherlands Sweden Spain Switzerland Denmark Belgium Austria Portugal

0

1

2

3

4

5

Source: PAC Altran positioning study 2005 & Altran Global Strategic Marketing.

In France and in Europe, the market should continue to experience signifi cant growth over the years to come that will rely on the following elements:

an increase in R&D expenditure. Western Europe is lagging behind in terms of the share of GDP invested in R&D activities and it is essential that the main industrial players start investing in order to catch up and reduce the time-to-market delays of new developments, a factor that is becoming critical for our customers;

furthermore, the sub-contracted share of this expenditure should continue to develop over the next few years. It is diffi cult to defi ne the potential sub-contracting rate. It is however important to realise that the sub-contracted R&D market represents at least 15% of total R&D expenditure in Europe (source: Pierre Audoin Consultants) and this percentage will no doubt continue to rise although the potential level is not likely to reach that of the IT services sector.

This market is still quite divided but should become more condensed over the next few years due to:

pressure from customers seeking to establish industrial partnerships with players on the R&D consulting market which is resulting in a generalisation of the referencing process and more importantly, a reduction in the number of privileged providers;

the evolution of customer demand toward solutions that offer a wider variety of content such as package deals which is making the situation more and more diffi cult for those players offering a single service;

growing pressure to provide fi xed-price services resulting in an accrued technicality of offers making them less accessible for smaller players specialised in technical support;

the globalisation of customers which is placing increased pressure on service providers for trans-national offers.

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Main markets

6.2 MAIN MARKETS


6 Information concerning the Group’s activities

6.3 COMPETITION

6.2.2 Organisation and information systems consulting

Approximately one-third of the Group’s annual sales are recorded by this activity.

This is a more structured market on which the Group has a lesser infl uence.

The European market is estimated at around 45 billion euros per annum (to the exclusion of outsourcing activities).

The company does not intend to offer services to large-scale computer services organisations (SSII) and will remained focused on certain technological niches (SAP, third-party application validation...), a market on which its expertise is renowned.

In France, in 2006, the market for applications and services recorded strong growth of 6.5% according to France’s Syntec Informatique. It is important to mention that the market is still growing 3 to 4 times faster than GDP levels and 1.5 to 2 times faster than corporate investments rates. In 2007, growth levels should remain high and Syntec Informatique is anticipating levels of 6% to 8%.

Corporate transformation projects play a major role in the market’s growth and the sector should continue to benefi t from increased demand for projects related to numerous mergers and takeover.

Consulting and applications facilities management (third-party application maintenance in particular) are this segment’s most active trades.

Among this segment’s customers the fi nancial industry stands out from the rest with an increase of 8% along with the public sector.

The market still offers exceptional long-term growth potential that is linked to continuously growing corporate needs, a trend favouring the outsourcing IT services and thriving technology.

6.2.3 Strategy and management consulting

The Group is mainly known for the Arthur D. Little trademark following an LMBO in 2002. At the time, the Group acquired all activities based outside the United-States as well as the trademark on an international scale.

This market has been growing rapidly since 2005 and should experience growth rates of 5 to 7% over the next few years (Source: Kennedy Information Research Group/Pierre Audoin Consultants). This growth can mainly be attributed to the increasing number of merger and takeover transactions recorded since 2006.

The Group’s offer is mainly structured around Arthur D. Little and focuses on a limited number of practices, capitalising on these areas of expertise throughout the world. For this reason, fi ve industry sectors have been defi ned for the development of Arthur D. Little activities on an international scale (healthcare, energy, automobile…). The management and strategy consulting market is estimated at approximately 50 billion euros per annum in the United-States and in Europe.

As previously mentioned, Altran is the European leader in technology and R&D consulting.

The type of competitor Altran Group’s teams deal with varies according to nature of the project in question. Altran’s competitors include:

strategy and/or management consulting fi rms, particularly with regard to projects handled by Arthur D. Little;

IT services organisation (SSII);

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engineering fi rms specialised in a specifi c technological fi eld (environment, mechanics, acoustics...);

listed companies offering services similar to those offered by Altran (Alten, AssystemBrime, SII...).

It is however interesting to note that none of these competitors benefi t from the same geographical presence as Altran, nor do they deal with such a wide array of industry sectors or technologies.

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Competition


6Information concerning the Group’s activities

The Group’s ability to take advantage of its international network and establish offers that include a variety of state-of-the-art skills and are available in numerous countries is a key, differentiating factor that responds to the demand of customers as they expand internationally.

In France, the Group has also regrouped its technologies consulting activities by vertical sector of activity so as to improve the clarity of its offers. Hereafter are details of the Group’s positions on the main European technologies consulting markets:

Competition

France United Kingdom GermanyMarket size 2005 € 4.0 billion € 4.0 billion € 4.4 billion

Top sectors Aeronautics

Automotive

Energy*

Telecom

Aeronautics

Energy*

Telecom

Public sector

Automotive

Industrial engineering

Energy*

AeronauticsTop 3 competitors Altran

Assystem

Alten

Atkins

BAE Systems

QinetiQ

Siemens

T-Systems

ESG

Trends Concentration, internationalization, reduction of number of actors referenced, reinforcement of Purchasing departments* Utilities, Chemicals, Environment.

Source: PAC Altran Positioning study 2005 & Altran Global Strategic.


The list of subsidiaries included in the scope of consolidation can be found on pages 82 to 87 of the appendices of the consolidated accounts.

7 Organisational chart


8.1 SIGNIFICANT INTANGIBLE FIXED ASSETS

The Group’s policy involves the rental of the premises on which it operates.

However, the Group owns its premises located in France, in Italy, the United Kingdom and Venezuela for an amount of 10.3 million euros.

8.2 ENVIRONMENT

Not signifi cant.

8 Real-estate properties, Plants and equipment


9.1.1 Corporate governance

Management Board At the opening of 2006, the Management Board was comprised of two members, Mr Christophe Aulnette, Chairman of the Board, and Mr Éric Albrand. Mr François-Xavier Floren was also appointed a member of the Management Board on 8 June 2006.

24 September 2006, the Supervisory Board accepted the resignation of Mr Christophe Aulnette from his mandate of Chairman of the Board and appointed Mr Yves de Chaisemartin as his replacement.

Finally, the Supervisory Board meeting of 20 November 2006 accepted the resignation of Mr François-Xavier Floren from his mandate of Management Board member.

At the end of 2006, the Management Board was comprised of two members, Mr Yves de Chaisemartin, Chairman of the Board, and Mr Éric Albrand.

The details of their mandates and functions are presented in paragraph 7.1.3 of this Report.

Supervisory BoardFollowing the resignation of Mr Yves de Chaisemartin from his mandate of Chairman and Member of the Supervisory Board on 24 September 2006, the resignation of Mrs Guylaine Saucier on 15 February 2007 and the co-opting of Mr Jacques Etienne de T’Serclaes at the Supervisory Board’s meeting on 5 March 2007, effective 30 March 2007, the Supervisory Board is now comprised of the following members:

Mr Dominique de Calan, Chairman;

Mr Michel Sénamaud, Vice-Chairman;

Mr Roger Alibault;

Mr Jacques-Étienne de T’Serclaes.

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9.1 HIGHLIGHTS

9 Overview of the fi nancial position and results (management report)

9.1 HIGHLIGHTS 22

9.1.1 Corporate governance 22

9.1.2 Launch of an employee share ownership plan: Spring 23

9.1.3 Cost-cutting and performance enhancement plan 23

9.1.4 Re-structuring of the Group 24

9.2 OVERALL POSITION OF COMPANIES INCLUDED IN THE SCOPE OF CONSOLIDATION 25

9.3 PERFORMANCE SECTOR BY SECTOR 28

9.4 ACTIVITY OF ALTRAN TECHNOLOGIES S.A. AND ITS MAIN SUBSIDIARIES 31

9.4.1 Highlights 31

9.4.2 Altran Technologies S.A. and its main subsidiaries 31

9.5 RESEARCH & DEVELOPMENT 32

9.6 PERSPECTIVES 32

9.7 IMPORTANT POST-CLOSING EVENTS 33

9.8 PRESENTATION OF ALTRAN TECHNOLOGIES S.A.’S CORPORATE ACCOUNTS AND PROPOSED APPROPRIATION OF EARNINGS 33

9.9 SUBSIDIARIES AND EQUITY INTERESTS 34

9.10 INFORMATION CONCERNING THE SHARE CAPITAL, CROSS-SHAREHOLDINGS, SELF-OWNED SHARES 34

9.11 CONTROLLED COMPANIES AND PORTION OF ALTRAN TECHNOLOGIES’ SHARE CAPITAL OWNED BY THESE COMPANIES (SELF-OWNED SHARES) 34

The Group’s fi nancial situation and results are also presented in detail in the consolidated accounts and relevant appendices (chapter 20).


9Overview of the fi nancial position and results (management report)

Their mandates will expire at the Annual General Meeting held in order to approve the accounts of the 2008 year end.

Mr Dominique de Calan was elected Chairman of the Supervisory Board on 29 September 2006, successor to Mr Yves de Chaisemartin, appointed Chairman of the Management Board on 24 September 2006.

The members of the Supervisory Board meet the criteria defi ned in the Bouton report in terms of their independence given that they do not have any relations with the Company, its Group or Management that could adversely affect their objectivity.

The representatives of the works council who participate in the Supervisory Boards’ meetings are:

Mr Heni Massouri;

Mr Bertrand Cahuzac.

The Group’s Management CommitteeDecember 2006, the Group established a new governance structure comprised of an Executive Committee and an Operational Committee for the two following purposes in particular: to ensure the day-to-day steering and proper operation of the company and to business development in France and overseas.

The executive committee is comprised of:

Yves de Chaisemartin, Chairman of the Management Board ;

Eric Albrand, M ember of the Management Board responsible for fi nance;

Cyril Roger, Deputy General Manager ;

Frédéric Grard, Deputy General Manager ;

Pascal Brier, Deputy General Manager in charge of strategy, marketing and communication.

The Operational Committee is comprised of fi ve members representing Altran’s various business lines and geographical locations. This committee was created due to a desire to directly involve operational managers in the Group’s development, providing the latter with a new, collective energy. The committee is comprised of:

Dominique d’Andrimont, Executive Manager of Altran Benelux & Scandinavia;

Jose Ramon Magarzo, Executive Manager of Altran Spain;

Yves Rommel, Executive Manager of Altran Germany, Austria, Switzerland;

Laurent Sicart, Executive Manager, French regions;

Michael Träm, C.E.O. of Arthur D. Little.

The Group’s Management Committee is comprised of the members of the Executive Committee and the members of the Operational Committee.

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9.1.2 Launch of an employee share ownership plan: Spring

During the fi rst half of 2006, Altran Technologies launched a share issue reserved for employees within the scope article L. 225-138-1 of the French Commercial Code and article L. 443-5 of the French Labour Code.

This share issue was offered to all Group employees in France, Germany, Spain, Italy, the United Kingdom, Ireland, Sweden, Belgium, Luxembourg, the Netherlands, Portugal and Austria.

This transaction has strengthened existing relations between the Group and its employees, offering the latter an opportunity to become more directly involved in the Group’s future developments and performance.

The Supervisory Board’s meeting of 7 March 2006 authorised the Board of Directors to use the powers with which it has been delegated by the Combined General Meeting of Shareholders of 29 June 2005 under the thirteenth resolution in order to carry out increases in share capital reserved for employees.

In compliance with this decision, the Board of Directors’ meeting of 10 March 2006 agreed to the principle of an increase in share capital for the benefi t of employees for a maximum of 3 million euros in par value.

On completion of the transaction, 24 May 2006, 2,872,255 new shares (thus 2.5% of the share capital) had been subscribed for an amount of 26.9 million euros and a total of 2,500 employees (of which 26.1 million euros fully paid up at 30 June 2006). Also, Altran Technologies’ share capital was divided into 117,314,469 shares, each with a value of 0.5 euros. The share of costs directly related to the increase in share capital has been appropriated, net of income tax, to the issue premium for an amount of 0.9 million euros. The share of costs related to the establishment of a Group employee savings plan, thus 1.4 million euros, has been recognised as a charge on ordinary activities.

9.1.3 Cost-cutting and performance enhancement plan

At the General Meeting of Shareholders’ of 29 June 2005, Altran announced a plan to reduce indirect costs.

The relevant re-structuring costs amount to 22 million euros for 2006 (2005: 52.7 million euros). These costs mainly include:

13 million euros in payroll costs;

3.2 million euros in fees and other charges;

5.8 million euros in rent and other charges, of which 4.2 million euros for the disposal of fi xtures and fi ttings and 1.6 million euros for the termination of lease agreements.

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Highlights



The objective announced by the Group was to establish a plan aimed at reducing indirect costs from 54 to 60 million euros for the year 2007 by means of:

a reduction in indirect staff costs, especially with regard to holdings;

the streamlining of the Group’s real-estate ;

a reduction in operating costs through the optimisation of the Group’s purchasing policy concerning certain items such as telecommunications, company cars, etc.

To date, this plan has achieved its purpose given the effi ciencies recorded. Nonetheless, signifi cant re-investment efforts have been made in order to support the Group’s growth, particular outside France. Also, it appears that despite the execution of this plan, indirect costs are still too high. The Group will announce a new cost-cutting plan aimed at reducing indirect costs to 3% of turnover by 2009.

9.1.4 Re-structuring of the Group

During the past months, the Group has re-structured numerous aspects of its activities within the scope of the Altran 2008 project.

So as to ensure the Group’s structure is more transparent for its customers and more effective, in summer 2005, the Altran Group launched a new operational structure regrouping its activities in two branches, the Consulting & Information Services branch and the Technology & Innovation branch.

In 2006, the Group had therefore regrouped its entire information services offer under a single management unit in order to expand and streamline the offer. This gradually led to locally-managed groupings of companies. In Italy therefore, 7 companies have grouped their information services offer under a single offer, creating a major market player. A shared trademark, CIS (Consulting & Information Services), is progressively being deployed so as to ensure greater clarity and impact.

As of early 2006, the geographical division in France between Paris-based and province-based activities has been implemented from a managerial perspective. Customers located in France’s provinces are now serviced by local teams, as are Paris-based customers. This division makes it possible to reduce the number of customer points of contact, providing them better access to all of the Group’s offers.

The decision has also been made to regroup all France-based Technology and Innovation consulting activities under a single operational entity and to defi ne four target markets with province-based activities to fi rstly be structured on a geographical basis:

Automotiv e, Infrastructures and Transport;

Aeronautics, space and defence ;

Telecoms, electronics and media;

Energy, industry and life sciences.

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In addition, a management unit in charge of transversal offers has been established.

Within this context, the Extraordinary General Meeting of 29 December 2006 approved the merger of the 26 companies involved with Altran Technologies: Acsience, Actisys, Adena Technologies, Alplog, Altair Technologies, Altior, Altran Avenir, Ariane Ingénierie, Atlantide, Berata, Berata Paris, CGS Executive Search, Ciriel, Cogix, Cortical, Gerpi, Grenat, Hémisphères, Inoquant, Logiqual, Lore, Orthodrome, Partenaire Sécurite Informatique, Realix Technologies, Segime and Consulting.

The takeover operations had a retroactive impact on both the accounts and taxation as of 1 January 2006.

These re-structuring operations are intended to:

enable a gradual improvement of the content of offers presented to corporate accounts;

facilitate customer access to all of the Group’s offers whilst keeping in-house competition to a minimum whereas in the past, competition has been a barrier in terms of growth and the quality of relations with corporate customers;

facilitate the career management of consultants by offering greater in-house mobility, a decisive factor in terms of attracting new talent;

streamline existing support structures for improved profi tability.

Along with these re-structuring efforts, the Group pursued projects commenced in 2005:

the establishment of a shared information infrastructure within the Group;

the development of a shared ERP (transactional tool) that will gradually be deployed in regions outside France as of January 2007;

the streamlining of real estate . This is how the Paris-based companies of the Technology & Innovation branch and the corporate holding were regrouped in a new building in Levallois during the summer of 2006, following in the footsteps of Madrid, Barcelona, Brussels, Turin, Rome, Milan...

By promoting the sharing of resources, these projects should be able to reduce the portion of turnover dedicated to indirect costs and are also a means of developing synergies between he Group’s companies.

The Group has also streamlined and expanded the process of factoring its client receivables. In France, an agreement has been signed with a factoring fi rm that will take over all client receivables which were previously handled by 4 different fi rms. This will also help streamline the collection of receivables which is entrusted to two external fi rms. Agreements for the assignment of client receivables have been signed in Benelux, Germany and Spain.

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9.2 OVERALL POSITION OF COMPANIES INCLUDED IN THE SCOPE OF CONSOLIDATION

(in thousand euros)December 2006

(12 months)December 2005


(12 months)

Turnover 1,495,350 1,434,473 1,395,633

Other income from operations 2,901 3,457 5,375

Income from ordinary operations 1,498,251 1,437,930 1,401,008

Current operating income 75,985 93,250 59,248

Other non-recurring operating income and charges (14,656) (37,963) 36,602

Goodwill amortization (15,880) (26,463) (25,581)

Operating income 45,449 28,824 70,269

Cost of net financial debt (23,094) (21,960) (17,122)

Other financial revenue 4,761 17,943 10,271

Other financial charges (7,766) (18,034) (16,559)

Tax expenses (15,805) (6,166) (29,508)

Equity share in net income of affiliates 110 (393) (85)

Net profit (loss) before net effect of ceased operations or operations currently being ceased 3,655 214 17,266

Net profit (loss) on ceased operations or operations currently being ceased - -

Net earnings 3,655 214 17,266

Minority interest 132 17 (360)

Group net earnings 3,787 231 16,906

Overall position of companies included in the scope of consolidation

Operating earnings on ordinary activities (to the exclusion of non-recurring items) stand at 76.0 million euros, thus an operating margin of 5.1%, down 1.4 points as compared to 2005. The Group’s declining performance is the result of two main factors:

a signifi cant loss of TI activities in the Paris area which has had a major impact on the Group’s earnings;

an increase of the wage-unit in excess of that recorded for the Group’s tariffs.

The geographical distribution of turnover however in the Northern zone, traditionally known for high margin levels, is gaining in signifi cance thus partially compensating for the previously mentioned effects.

External charges have increased by 10.4 million euros.

Operating earnings on ordinary activities stand at a rate of 3.7% for the second half of 2006 as compared to 6.4% for the fi rst half-year.

2006’s operating profi t is 45.4 million euros and was mainly affected by re-structuring charges in the amount of 22 million euros and the reversal of tax provisions made at the time the Arthur D. Little activity was acquired in the amount of 5.1 million euros. The Group has recorded goodwill impairment in the amount of 15.9 million euros concerning the depreciation of acquired companies.

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Financial earnings (26.0 million euros) are on par with the Group’s debt.

The Group’s net earnings stand at 3.8 million euros for 2006.

Turnover

Turnover for 2006 stands at 1,495,350 thousand euros, up 4.2% from 2005, thus an increase of 60,877 thousand euros.

This increase in turnover is mainly the result of high activity levels and stable turnover in France, mainly during the second half-year. Most of this increase in turnover has been attributed to the overall increase in staff numbers and the growing signifi cance of the Northern Europe zone where tariffs are generally higher, signifi cantly altering the distribution of turnover.




2006 2005 2006 vs 2005

Turnover 1,495,350 1,434,473 4.2%

Staff costs 1,027,265 977,581 5.1%

% turnover 68.7% 68.1%

H 2 2006 H 1 2006 H 2 2005 H 1 2005H 2 2006 vs

H 2 2005H 1 2006 vs

H 1 2005

Turnover 749,461 745,889 710,470 724,003 5.50% 3.0%

Staff costs 512,399 514,866 473,099 504,482 8.3% 2.1%

% turnover 68.4% 69.0% 66.6% 69.7%

2006 2005 2006 vs 2005

Total external charges 319,925 309,515 3.40%

% turnover 21.4% 21.6%

Sub-contracting 95,988 96,033 0.0%

% turnover 6.4% 6.7% BC red. 3,505 5,130 (31.7)%

% turnover 0.2% 0.4% Simple rentals and external expenses 53,724 55,986 (4.0)%

% turnover 3.6% 3.9% Training 9,316 7,129 30.7%

% turnover 0.6% 0.5% External services and fees 49,419 45,523 8.6%

% turnover 3.3% 3.2% Transportation and travel 68,246 63,236 7.9%

% turnover 4.6% 4.4% Other purchases and outside services 39,727 36,478 8.9%

% turnover 2.7% 2.5%

H 2 2006 H 1 2006 H 2 2005 H 1 2005H 2 2006 vs

H 2 2005H 1 2006 vs

H 1 2005

Total external charges 160 563 159 362 153 884 155 631 4,3 % 2,4 %

% turnover 21.4 % 21.4 % 21.7 % 21.5 %

Sub-contracting 47,936 48,052 49,606 46,427 (3.4) % (3.5) %

% turnover 6.4 % 6.4 % 7.0 % 6.4 %

BC red. 1,668 1,837 2,550 2,580 (34.6) % (28.8) %

Charges

Operating charges on ordinary activities rose between 2005 and 2006 with regard to both payroll expense, whose relative impact has risen 0.6 points, and external charges, whose relative impact remains stable.

The evolution of charges is as follows:

Payroll charges are up 5.1% from 2005 with a variance of +8.3% between 2005’s second half-year and 2006’s. Payroll charges climbed more rapidly than turnover which further explains the previously mentioned point concerning decreased profi tability:

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External charges have increased by 3.4%, thus 10.4 million euros, mainly due to an increase in “travel expenses” (+7.9% thus an increase of 5 million euros) and “external services fees” (+8.6% thus an increase of 3.9 million euros). External charges as a

a percentage of turnover, thus 21.4%, remain stable over both half-years. The “sub-contracting” item which experienced a strong increase between 2004 and 2005 remained stable between 2005 and 2006 and is therefore of lesser signifi cance.



H 2 2006 H 1 2006 H 2 2005 H 1 2005H 2 2006 vs

H 2 2005H 1 2006 vs

H 1 2005

Total external charges 160 563 159 362 153 884 155 631 4,3 % 2,4 %

% turnover 0.2 % 0.2 % 0.4 % 0.4 %Simple rentals and external expenses 26,586 27,138 27,898 28,088 (4.7) % (3.4) %

% turnover 3.5 % 3.6 % 3.9 % 3.9 %

Training 5,296 4,020 2,947 4,182 79.7 % (3.9) %

% turnover 0.7 % 0.5 % 0.4 % 0.6 %

External services and fees 23,868 25,551 20,345 25,178 17.3 % 1.5 %

% turnover 3.2 % 3.4 % 2.9 % 3.5 %

Transportation and travel 33,537 34,709 31,678 31,558 5.9 % 10.0 %

% turnover 4.5 % 4.7 % 4.5 % 4.4 %Other purchases and outside services 21,672 18,055 18,860 17,618 14.9 % 2.5 %

% turnover 2.9 % 2.4 % 2.7 % 2.4 %

Cost of net fi nancial debt

The cost of net fi nancial debt mainly corresponds to fi nancial instruments used to invest cash and cash equivalents after deduction of fi nancial charges. The latter are mainly interest on amounts borrowed by means of the 2009 convertible bond loan (OCEANE), lines of credit and the factoring of trade receivables.

The cost of net debt rose 1.1 million euros in 2006. This increase can mainly be attributed to the evolution of short-term interest rates.

Income tax

Income tax on consolidated earnings represents 15.8 million euros for 2006 as compared to 6.2 million euros in 2005.

This increase is mainly the result of:

the negative impact of deferred tax assets used to discharge tax losses;

the fact that income tax was not paid on gains derived from the disposal of CSR shares in 2005;

additional income tax in Germany and Italy.

The effective income tax rate has gone from 19% to 45%.

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(in millions of euros)2006

12 months2005

12 monthsChange

2005/2006

Net financial debt at opening (1 January) (301.5) (314.0) 12.5

Net cash flow generated by business activities 9.7 46.1 (36.4)

Net cash flow generated by investment activities (71.8) (35.6) (36.1)

Net cash flow before financing operations (62.0) 10.5 (72.5)

Exchange rate impact and other (0.6) 2.0 (2.6)

Impact of capital increase (spring) 25.4 - 25.4

Net financial debt at closing (31 December) (338.7) (301.5) (37.2)

Net cash-fl ow per activityThe cash-fl ow per activity has decreased and stands at 9.7 million euros at 31 December 2006 as compared to 46.1 million euros at 31 December 2005. This trend is the result of a decrease of client receivable accounts in the amount of 72.4 million euros and cash

outfl ows used to cover re-structuring operations in relation to the cost-cutting plan announced at the General Meeting of Shareholders in June 2005 in the amount of 33 million euros.



Net cash-fl ow related to investment activitiesThe cash-fl ow related to investment activities for the year ended 31 December 2006 represents (71.8) million euros as compared to (35.6) million euros for the year ended 31 December 2005.

This decrease is mainly the result of facilities acquired within the scope of the Group’s real-estate re-structuring operations (14 million euros) and the variance of earn-out payments (19 million euros).

Group’s indebtedness

As compared to 31 December 2005, the Group’s indebtedness has risen 43 million euros on a like-for -like basis and represents 379.9 million euros at 31 December 2006.

(in millions of euros) 31/12/2006 12/31/2005 Change

2009 convertible 197.9 197.9 -

Medium-term credit line 62.4 75.7 (13.4)

Short-term credit line 204.7 191.0 13.7

of which factoring 159. 0 141. 1 17.9

Total financial debt 464.9 464.6 0.3

Cash and cash equivalents 126.2 163.1 (36.9)

Net financial debt 338. 7 301.5 37.2

Employee profit sharing 14.1 14.9 (0.9)

Accrued interest 27.1 20.5 6.6

Net debt 379.9 336.9 43.0

The Group’s gross fi nancial debt is 464.9 million euros at 31 December 2006 as compared to 464.6 million euros at 31 December 2005.

Cash and cash equivalents represent 126.2 million euros at 31 December 2006 as compared to 163.1 million euros at 31 December 2005.

Evolution of staff numbers

31/12/2003 30/06/2004 12/31/2004 30/06/2005 12/31/2005 30/06/2006 31/12/2006

Total workforce at end of period 16,533 16,429 16,446 16,282 16,152 16,716 17,057

2003 H 1 2004 H 2 2004 H 1 2005 H 2 2005 H 1 2006 H 2 2006

Average workforce during the period 17,008 16,475 16,536 16,377 16,202 16,313 16,808

Performance sector by sector

During 2006, staff numbers had increased by 905. The Group recorded a strong increase in staff numbers for the second half-year

running and 2006 largely compensates for the declining staff number recorded between 2003 and 2005.



9.3 PERFORMANCE SECTOR BY SECTOR


2006 2005

(in thousand euros) Sector totalInter-sector eliminations Total, non-group % of turnover Total, non-group % of turnover Change

France 659,137 (17,208) 641,929 42.9% 667,077 46.5% (3.8)%

North 485,815 (18,516) 467,299 31.3% 399,613 27.9% 16.9%

South 287,940 (4,198) 283,742 19.0% 275,324 19.2% 3.1%

Rest of the world 105,768 (3,388) 102,380 6.8% 92,459 6.4% 10.7%

Total 1,538,659 (43,309) 1,495,350 100.0 % 1,434,473 100.0% 4.2%

The distribution of total sales per country is as follows:

2 006%

turnover H 2 2 006%

turnover H 1 2 006%

turnover 2 005%

turnover H 2 2 005%

turnover H 1 2 005 % CA

France 641,929 42.9% 315,976 42.2% 325,953 43.7% 667,077 46.5% 320,932 45.2% 346,145 47.8%

Germany 139,047 9.3% 72,250 9.6% 66,797 9.0% 118,401 8.3% 60,436 8.5% 57,965 8.0%

Austria 6,355 0.4% 3,281 0.4% 3,074 0.4% 7,019 0.5% 3,705 0.5% 3,314 0.5%Great Britain (Ireland) 117,445 7.9% 62,769 8.4% 54,676 7.3% 94,337 6.6% 50,462 7.1% 43,875 6.1%

Benelux 131,170 8.8% 68,636 9.2% 62,534 8.4% 109,942 7.7% 52,536 7.4% 57,406 7.9%

Switzerland 40,620 2.7% 20,591 2.7% 20,029 2.7% 41,202 2.9% 20,378 2.9% 20,824 2.9%

Sweden 32,661 2.2% 15,753 2.1% 16,908 2.3% 28,712 2.0% 14,054 2.0% 14,658 2.0%

Italy 141,581 9.5% 69,950 9.3% 71,631 9.6% 130,946 9.1% 65,762 9.3% 65,184 9.0%

Spain 105,947 7.1% 51,427 6.9% 54,520 7.3% 104,046 7.3% 51,132 7.2% 52,914 7.3%

Portugal 19,066 1.3% 9,671 1.3% 9,395 1.3% 18,369 1.3% 9,368 1.3% 9,001 1.2%

Brazil (Venezuela) 17,148 1.1% 8,753 1.2% 8,395 1.1% 21,962 1.5% 13,117 1.8% 8,845 1.2%

Asia 16,820 1.1% 7,176 1.0% 9,644 1.3% 13,428 0.9% 7,674 1.1% 5,754 0.8%

USA 85,561 5.7% 43,177 5.8% 42,384 5.7% 79,031 5.5% 40,914 5.8% 38,117 5.3%

Total 1,495,350 100.0% 749,408 100.0% 745,942 100.0% 1,434,473 100.0% 710,470 100.0% 724,003 100.0%

Contrary to 2005, a year during which the increase in turnover was led by the USA, 2006 increase (+4.2%) can be attributed to the Northern Europe zone with Great-Britain (+24.5%), Benelux (+19.3%), Germany (+17.4%) and Sweden (+13.8%) holding the lead positions. Countries in the Southern zone have recorded less signifi cant increases to the exception of Italy (+8.1%). Spain and Portugal experienced weak market growth with the second half-year having been particularly negative.

Finally, it is important to mention that activity levels declined more rapidly in France, especially in terms of the Technology & Innovation branch. Whereas the decrease in activity between 2004 and 2005 was 2.4%, the decrease recorded between 2005 and 2006 is 3.8%. Re-structuring operations and the merger of all companies have signifi cantly affected activities.

Turnover for 2006 stands at 1,495,350 thousand euros, up 4.2% from 2005, thus an increase of 60,977 thousand euros.

The distribution of turnover by geographical zone is as follows:



Earnings per geographical zone

North December 2006 June 2006 December 2005 June 2005 2006 versus 2005

Turnover 467.3 232.1 413.8 204.3 12.9%

Total operating income 467 .6 232.3 415.6 205.1 12 .5 %

Total operating expenses (399 .7 ) (205.2) (380.0) (190.1) 5.2 %

Current operating income 67 .9 27.2 35.6 15.0 90 .7 %

% Current operating income 14 .5 % 11.7% 8.6% 7.3%

Operating income 59.2 26.3 20.7 22.5 186 %

% Operating income (14.8 )% (12.8)% (5.4) % (11.8)%

The Northern zone made a major contribution to the Group’s growth with an increase in turnover of 12.9% and had an even greater impact on operating earnings on ordinary activities, up 63% with the rate for a full year having climbed from 8.6% to 12.4%.

This clear-cut improvement is the result of a 17% increase in operating income alongside a 12.7% increase in charges.

South December 2006 June 2006 December 2005 June 2005 2006 versus 2005

Turnover, non-group 283.7 146.0 279.1 137.9 1.6%

Total operating income 288.4 146.4 280.1 138.3 3.0%

Total operating expenses (274.3) (134.1) (261.4) (129.9) 4.9%

Current operating income 14.1 12.3 1 8,7 8.4 (24.6)%

% Current operating income 5.0% 8.4% 6.7% 6.1%

Operating income 6.1 7.3 10.3 8.6 (40.8)%

% Operating income (2.2) % (5.4)% (3.9)% (6.6)%

The Southern zone recorded an increase in turnover of 1.6% with an increase in operating charges of 4.9% which explains the 24.6% decline in operating income on ordinary activities.

Activity levels remained low in Portugal and Brazil. Although Spain recorded an increase, its profi tability has suffered as a result of the merger operations. The situation is the same for Italy.

France December 2006 June 2006 December 2005 June 2005 2006 versus 2005

Turnover, non-group 641.9 334.6 684.1 354.2 (6.2)%

Total operating income 661.4 334.9 684.3 354.9 (3.3)%


Current operating income 2.9 7.9 34.4 16.6 (91.6)%


Operating income (16.8) (1.0) (2.6) 15.7 546.2%

% Operating income 2.6% 0.3% 0.4% (4.6)%

France saw its turnover drop 6.2% with operating charges remaining stable from one year to the next (-1.3%). Operating earnings on ordinary activities have increased by 2.9 million euros as compared to an increase of 34.4 million euros in 2005. Industrial technology activities have been signifi cantly penalised due to a very competitive environment.

The pressure on payroll expenditure remained strong despite the fact that service activities went through a diffi cult period which particularly involved a restrictive purchasing policy concerning major contract originators.




Rest of the world December 2006 June 2006 December 2005 June 2005 2006 versus 2005

Turnover, non-group 102.4 53.7 95.7 45.8 7.0%

Total operating income 105.6 53.7 95.7 45.9 10.3%


Current operating income 0.9 1.6 4.5 1.8 (80.0)%


Operating income (3.1) (0.3) 0.4 1.5 (875.0)%

% Operating income 3.0% 0% (0,4) % (3,4) %

Activity of Altran Technologies S.A. and its main subsidiaries

Altran Technologies (Technology & Innovation - TI)In 2006, the company established in France regrouped the activities of the 26 existing companies via a merger effective as of December 2006

for legal purposes and as of 1 January 2006 for taxation purposes. For this reason, a comparison with 2005 is of no signifi cance. This activity, affected by a signifi cant decrease in turnover during the year, is now structured around a geographical allocation between Paris

Throughout the rest of the word, turnover increased 7% with charges up 14.8%. Operating earnings on ordinary activities dropped 80%. This zone was penalised by a weak increase in activity in Asia and declining margins in the USA.

Investments in the Eastern Europe zone have not yet had any signifi cant impact on turnover.

9.4 ACTIVITY OF ALTRAN TECHNOLOGIES S.A. AND ITS MAIN SUBSIDIARIES

9.4.1 Highlights

The highlights of the company and its main subsidiaries are presented in chapter 1 of this report.

9.4.2 Altran Technologies S.A. and its main subsidiaries

Turnover, non-group

(in euros) 2006 2005 2006 vs 2006

Altran Technologies 456,382,951 119,162,287 283.0%

Altran CIS (Italy) 51,449,490 33,077,870 55.5%

ASI 42,934,158 40,798,895 5.2%

Datacep 41,230,845 36,482,475 13.0%

Askon Consulting Group GmbH 39,926,057 NA

CSI 38,145,068 48,946,864 (22.1)%

ADL Germany 34,754,086 26,835,327 29.5%

Cambridge Consultants 29,770,417 27,263,629 9.2%

Altran Europe 29,707,774 25,146,965 18.1%

Berata (DEU) 29,548,060 26,779,236 10.3%

Total 793,848,906 384,493,549 106.5%



and the provincial regions and a distribution per trade (Automobile, Infrastructures and Transport/ Aeronautics, Space and Defence technologies/Telecoms, Electronics and Media/ Energy, Industry and Life sciences).

Altran CIS (Italy) (Consulting & Information Services - CIS) Altran CIS Italy groups all CIS activities for the Italian market following a merger operation in 2006. The latter are essentially focused on the banking, insurance and industrial sectors. The company also has a very extensive public-sector customer base.

ASI – Altran Systèmes d’Information (CIS) This company has re-oriented itself toward markets with high added-value, reaching out to banking institutions and insurance companies. Its trade has evolved considerably from technical support for information systems to trade-related support, trading rooms in particular. This change of direction has adversely affected growth but has enabled the company to consolidate its margins and earn a reputation on niche markets with high added-value.

Datacep (CIS) The company is established in Paris and Lille and in 2006, experienced strong growth with a customer base comprised mostly of industrials, energy providers, hypermarkets and transport organisations. It main trade is technical support for information systems.

Askon Consulting Group (TI) Established in Germany, the Askon Consulting Group recorded growth of 8.3% in 2006. Askon Consulting Group deals with customers in the aeronautics and automobile industries.

CSI – Control Solutions International (other) CSI is mainly established in the USA and its activity is around establishing Sarbanes-Oxley standards within American corporate groups. The latter having internalised these functions, the company is now focusing on mid-size companies. This change of direction explains the signifi cant decline of turnover (almost 22%). Up until now, CSI was subject to regulations prohibiting the accumulation of mandates applicable to major auditing fi rms.

ADL Germany – Arthur D. Little (strategy and management consulting) Established in Germany, the company recorded strong growth in 2006 which is due to certain non-recurring items. Regarding ordinary activities, levels remained stable, particularly with regard to the energy sector and new, top-level contracts obtained with the banking and fi nancial industries. ADL Germany has expanded its activities to Switzerland and Austria.

Cambridge Consultants (other) Established in the United Kingdom, CCL recorded an increase in growth of 9.2%. CCL’s activity is based on specifi c R&D projects for various industry sectors: healthcare, telecoms and industrial. Cambridge Consultants has developed a signifi cant share of activity in the United-States and is also an incubator for research activities.

Altran Europe (TI) Established in Belgium, Altran Europe has recorded growth of +18.1% for 2006. Its projects are intended for the telecoms, media and electronics industries.

Berata (TI) Established in Germany, Berata has recorded growth of +10.3% for 2006. Berata handles projects for major industrial accounts within the aerospatial, defence and automobile industries in particular.

Perspectives

9.5 RESEARCH & DEVELOPMENT

For the entire Group, development costs were recorded in the amount of 1.137 million euros at 31 December 2006.

There were no development costs recorded for Altran Technologies S.A.

9.6 PERSPECTIVES

Overview for the Group

2006 highlights the pertinence of the re-structuring operations

carried out by the Group that were able to stabilise activity levels in France in the second half of the year whilst generating strong growth on an international scale.



For 2007, the Group intends to achieve more rapid growth:

by maintaining at least the same pace as the international market in terms of its development;

by re-establishing a global rate of growth in France.

These changes will be made possible by the positive impact of a structure that is more focused on its customers and better able to meet their demands and by a gradual evolution toward high added-value offers. The encouraging profi tability levels recorded in Northern Europe, a zone in which content offers are the most present, demonstrates that this evolution is a means of increasing the Group’s margin.

2006’s fi nancial results however also indicate that efforts to control the Group’s general expenses must be reinforced rapidly.

Although the plan announced in June 2005 did indeed have the anticipated impact in terms of gross effi ciencies, it was not effective

a

a

enough in terms of reducing the impact of general expenses on turnover, thus 28.1% in 2006. The best industry practices suggest an acceptable rate of around 20.0%.

The Group will therefore launch a programme intended to reduce general expenses by at least 3 points by the start of 2009 and encourage a movement toward the best industry practices in the mid-term. More detailed information on this programme will be presented at the next General Meeting of Shareholders in June 2007.

The Group therefore intends to pursue these turnaround efforts by acting on two fronts:

accelerated turnover growth;

a reduction of the impact of general expenses.

a

a

9.7 IMPORTANT POST-CLOSING EVENTS

Presentation of Altran Technologies S.A.’s corporate accounts and proposed appropriation of earnings

At the Supervisory Board’s meeting of 11 January 2007, Mr Yves de Chaisemartin and Mr Éric Albrand submitted their resignation from their mandates of Member of the Management Board. As of 11 January 2007, the Supervisory Board has therefore decided that the Management Board will comprise two members and appointed Mr Yves de Chaisemartin Chairman and Member of the Board and Mr Éric Albrand Member of the Board, both for a term of two years.

27 February 2007, the Group announced the co-option of Mr Jacques-Etienne de T’Serclaes for the mission of Member of the Supervisory Board and Chairman of the Audit Committee in replacement of Mrs Guylaine Saucier, the latter having resigned. This co-option was validated by the Supervisory Board on 5 March 2007, effective as of 30 March 2007.

The Spanish company USM Endecar was disposed of on 5 February 2007. This company recorded an annual turnover of around 2 million euros.

9.8 PRESENTATION OF ALTRAN TECHNOLOGIES S.A.’S CORPORATE ACCOUNTS AND PROPOSED APPROPRIATION OF EARNINGS

Altran Technologies S.A. is the parent company of the Altran Group. It has an operational activity and is also in charge of ensuring the Group’s General Management.

Altran Technologies’ turnover for 2006 is 490.9 million euros (post-merger) as compared to 160.8 million euros in 2005. For information, Altran Technologies’ intrinsic turnover for 2006, calculated in the same manner as for 2005, is 156.3 million euros, thus a decrease of 2.8% as compared to 2005.

The company’s operating earnings (post-merger) stand at -7.1 million euros as compared to -25.2 million euros in 2005.

Financial earnings are recorded at -3.1 million euros for 2005.

Earnings on non-recurring activities stand at -4.1 million euros which represents the difference between transactions involving re-structuring charges and those for the sale of businesses pursuant to the merger operation.



The main changes to the scope of consolidation in 2006 were as follows:

AcquisitionsWithin the context of a merger operation involving the 26 companies mentioned in paragraph 1 here above, Altran Technologies reclassifi ed its shareholdings via the acquisition of a certain number of equity interests in the aim of owning 100% of the shares of the companies to be absorbed.

The main share acquisitions made by Altran Technologies are:

100.00% of Adena shares;

100.00% of Orthodrome shares;

100.00% of Lore shares;

100.00% of Realix Technologies shares;

a

a

a

a

100.00% of Hémisphères shares;

100.00% of Ariane Ingénierie shares;

100.00% of Altaïr Technologies shares;

99.80% of SARL Altran Avenir’s share capital;

100.00% of Berata Paris’ share capital;

100.00% of Berata’s share capital;

59.28% of CGS Executive Search’s share capital.

Disposals/LiquidationsThe following companies were disposed of during the year:

100% of shares in the French company 2 AD Ingénierie;

100% of shares in the Swiss company Sigma.

a

a

a

a

a

a

a

a

a

9.10 INFORMATION CONCERNING THE SHARE CAPITAL, CROSS-SHAREHOLDINGS, SELF-OWNED SHARES

Information concerning Altran shareholder structure is included in this reference document under chapter 18: « Main Shareholders ».

Controlled companies and portion of Altran Technologies’ share capital owned by these companies (self-owned shares)

9.9 SUBSIDIARIES AND EQUITY INTERESTS

After recognition of employee profi t sharing in the amount of 5.5 million euros and the sum of income tax and tax credits in the amount of -16.5 million euros, a net loss of -3,294,619 euros was recorded at 31 December 2006. We hereby propose that this amount be appropriated in full to the carry forward item.

The carry forward item now stands at 49,450,809 euros.

We would like to recall the following amounts:

non tax-deductible charges in the amount of: 15,883,303 euros;

overall non-deductible expenditure according to Article 39.4 of France General Tax Code and the corresponding income tax amount: 1,050,210 euros;

the re-integration of a fi nal tax adjustment: 0 euro.

As required by law, we inform you that no dividends have been distributed for the past three years.

a

a

a

9.11 CONTROLLED COMPANIES AND PORTION OF ALTRAN TECHNOLOGIES’ SHARE CAPITAL OWNED BY THESE COMPANIES (SELF-OWNED SHARES)

None.

35Document de référence 2006

10.1/10.2 INFORMATION ON THE ISSUER’S CAPITAL

Information concerning Altran shareholder structure is included in this reference document under chapter 18: « Main Shareholders ».

10.3 TERMS & CONDITIONS OF LOANS

All terms and conditions of loans are presented in chapters 4.1 Liquidity risks and 4.3 Interest rate risks.

10.4 RESTRICTIONS AFFECTING THE USE OF CAPITAL

We would like to recall that as defi ned in section 4.1 Liquidity Risks, the only restrictions affecting the use of lines of credit granted by the Group’s three main banking partners on 22 December 2004 are as follows:

the amount used for new acquisitions is capped at 30 million euros per corporate year;

asset disposals are not to exceed 10 million euros per corporate year, to the exclusion of authorised disposals.

a

a

10.5 FINANCING OF ACTIVITIES

The Group considers that cash fl ows generated by operating activities and its overall cash-fl ow along with the funds available via lines of credit, amounts assigned to factoring fi rms and the convertible bond issue of July 2004, repayable 1 January 2009, will not cover the expenditure and investment requirements of its operations and the repayment of the OCEANE issue at 1 January 2009.

The Group is therefore working to establish a re-fi nancing plan intended to meet its up-and-coming deadline (1 January 2009) without affecting the execution of its plan to cut indirect costs. The Group would like to complete this re-fi nancing plan in 2007.

10 Treasury and capital

36 Document de référence 2006

For the Group, development costs were recorded in the amount of 1.1 million euros during the fi scal year ending 31 December 2006 and the cumulated net value of the development costs to that date was 4.7 million euros.

No development costs were recorded for Altran Technologies.

11 Research & Development


12.1 MAIN TRENDS

In 2006, the Group underwent some major changes:

a reduction in the number of legal entities;

a re-structuring of the offer per market that better serves customers;

a gradual enhancement of its offer that is better suited to the evolutions of the consulting and innovation market.

a

a

a

These changes should enable Altran to increase its turnover more rapidly in 2007.

The second factor is a priority and will involve the reduction of general expenditure so as to improve the Group’s profi tability.

12.2 POST-CLOSING EVENTS

Turnover for 2007’s Q1 stands at 394.3 million euros, up 6.1% as compared to 2006’s Q1.

This increase accounted for:

a negative impact of working days of 1.0%;

a negative foreign exchange impact of 0.5%;

the negative impact of the scope of consolidation due to the disposal of companies, 0.5%.

a

a

a

In France, the Group’s turnover was 167.0 million euros which is stable as compared to 2006’s Q1. Without accounting for the impact of the number of working days, turnover has increased 1.2% in France for 2007’s Q1.

Internationally, turnover stands at 227.4 million euros, up 11.4% from 2006.

(in millions of euros) Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007Turnover excluding contribution from companies acquired/divested (a) 370.0 372.4 353.7 393.3 394.2

Contribution of acquired companies (b)

Contribution of divested companies (c) 1.6 1.9 1.4 1.2 0.1

Turnover (a) + (b) + (c) 371.6 374.3 355.1 394.5 394.3

At 31 March 2007, the Group employed 17,037 people, thus 20 less than at 31 December 2006.

PerspectivesOn an international scale, the Group intends to continue recording growth levels in excess of market forecasts.

In France, the trend must be confi rmed and intensifi ed.

12 Information on trends


The various markets on which the Group intervenes (strategy and management consulting, technology and R&D consulting, organisation and information systems consulting) should continue to grow in 2007. This will also serve as a foundation that will enable the Group to

consolidate past actions and further pursue its re-structuring efforts. The Altran Group will not be presenting its 2007 year-end turnover or earnings forecasts.

13 Forecasts


14.1 COMPOSITION OF CORPORATE UNITS

14.1.1 Composition of the Supervisory Board

Name Date of 1st appointment Date of term expirationPrimary roles and responsibilities

at the company

Mr Dominique de Calan 29/06/2005Annual shareholders meeting for FY

ending 31/12/2008Member of the Supervisory Board and

Vice-Chairman

Mr Michel Sénamaud 29/6/2005Annual shareholders meeting for FY

ending 31/12/2008Member of the Supervisory Board and

Vice-Chairman

Mr Roger Alibault 29/6/2005Annual shareholders meeting for FY

ending 31/12/2008 Member of the Supervisory Board

Mrs. Guylaine Saucier 29/6/2005Annual shareholders meeting for FY

ending 31/12/2008 Member of the Supervisory Board

29 September 2006, the Supervisory Board appointed Mr Dominique de Calan Chairman of the Supervisory Board in replacement of Mr Yves de Chaisemartin, the latter having resigned. The meeting of the Supervisory Board of 5 March 2007 accepted the resignation of

Mrs Guylaine Saucier, effective as of 15 February 2007. It co-opted effective as of 30 March 2007 and for the remainder of Mrs Guylaine Saucier’s term of offi ce, Mr Jacques-Étienne de T’Serclaes.

14.1.2 Composition of the Management Board

As of 11 January 2007, the composition of the Management Board is as follows:

Name Date of 1st appointment Date of term expiration Primary role in the company

Mr Yves de Chaisemartin 24/9/2006 10/1/2009 Chairman of the Management Board

Mr Éric Albrand 30/6/2005 10/1/2009 Member of the Management Board

At the opening of 2006, the Management Board was comprised of two Members, Mr Christophe Aulnette, Chairman of the Board, and Mr Éric Albrand.

Mr François-Xavier Floren was also appointed Member of the Board on 8 June 2006.

14 Administration, management and supervisory units

14.1 COMPOSITION OF CORPORATE UNITS 39

14.1.1 Composition of the Supervisory Board 39

14.1.2 Composition of the Management Board 39

14.1.3 Mandates and functions entrusted to corporate representatives by companies other than Altran Technologies within the past five years 40

14.2 CONVICTIONS FOR FRAUD, LIQUIDATION PROCEEDINGS OR SANCTIONS AFFECTING MEMBERS OF ADMINISTRATION UNITS 51

14.3 POTENTIAL CONFLICTS OF INTEREST INVOLVING MEMBERS OF THE MANAGEMENT BOARD OR THE SUPERVISORY BOARD 51



composition of corporate units

24 September 2006, the Supervisory Board accepted the resignation of Mr Christophe Aulnette from his mandate of Chairman of the Management Board and appointed Mr Yves de Chaisemartin as his replacement.

Finally, the Supervisory Board meeting of 20 November 2006 accepted the resignation of Mr François-Xavier Floren from his mandate of Member of the Board.

At the end of 2006, the Management Board of was comprised of two members, Mr Yves de Chaisemartin, Chairman of the Board, and Mr Éric Albrand.

14.1.3 Mandates and functions entrusted to corporate representatives by companies other than Altran Technologies within the past five years

Mr Yves de Chaisemartin, Chairman of the Management Board Year Positions held and duties performed Name of company

2002 Manager Journaphone

Procorec

Promolouvre

Promoporte

Publicité Annonces

SCPIPresident SMRL

Soc. Invest 1

Soc. Invest 2

Conseil Supérieur MessageriesChairman of the Management Board of Directors Société de gestion du Figaro

Chairman of the Board of directors Delaroche S.A.

SodenMember of the Supervisory Board F.C.N.A.

Sole board member GIE at 31, rue des Jeuneurs

Administrator Cadremploi

Delaroche S.A.

Figaro Holding

Inter Régies S.A.

Le Bien Public

Publiprint

S.E.R.P.O

S.P.C.O

Le Figaro Company

Sodinfor

L’Est RépublicainPermanent representative of PUBLIPRINT E.D.P Board of directors

Permanent representative of S.E.F.L FRANPRESSE Board of directors

Représentant permanent de S.E.R.P.O FAP

Permanent representative of SOCPRESSE FAP Board of directors

D.I.P.O Board of directors

PRESSE NORD Board of directors

In Belgium

Board member NORD ECLAIR BELGE

In Japan

Director Board of Directors FIGARO MAGAZINE YK


14Administration, management and supervisory units

Year Positions held and duties performed Name of company2003 Manager Journaphone

Procorec

Promolouvre

Promoporte

Publicité Annonces

SCPIPresident SMRL

Soc. Invest 1

Soc. Invest 2

Soc. Invest 3

Soc. Invest 4

Conseil Supérieur MessageriesChairman of the Management Board Société de gestion du Figaro

SocpresseVice-Chairman of the Supervisory Board Figaro Holding


Administrator CADREMPLOI

DELAROCHE S.A.

EXPLORIMMO

LE BIEN PUBLIC

PUBLIPRINT

LE FIGARO COMPANY

VOIX DU NORD INVESTISSEMENT

L’EST RÉPUBLICAINMember of the Supervisory Board VIVOLIO

F.C.N.ABoard of Directors member MOTEURPRINT

Permanent representative of PUBLIPRINT

In Belgium

Company Board member Nord Eclair BelgeIn Managing Director Rossel et Cie S.A.

In Japan

Director Board of Directors Figaro Magazine YK

2004 Manager Journaphone

Promolouvre

Promoporte

SCPI

Chairman SMRL

Soc. Invest 1

Soc. Invest 2

Soc. Invest 3

Soc. Invest 4

Conseil Supérieur Messageries






Year Positions held and duties performed Name of company


Delaroche S.A.

Editions Generation

Explorimmo

Le Bien Public

Publiprint

Figaro Ago Company

Voix du Nord Investissement

L’Est Républicain

Chairman of the Management Board Société de gestion du Figaro

Socpresse

Vice-Chairman of the Supervisory Board Figaro Holding

Express Expansion Group

Member of the Supervisory Board F.C.N.A.

In Belgium

Managing Director Rossel et Cie S.A.

In Japan

Director Board of Directors Figaro Magazine YK

2005 Chairman SMRL

Conseil Supérieur Messageries



Editions Generation

Explorimmo

Le Bien Public

Vice-Chairman of the Supervisory Board Figaro Holding

Member of the Supervisory Board F.C.N.A.

CEO Marianne

In Belgium

In Managing Director Rossel et Cie S.A.

2006

Since 02/10/2006 President Altran Innovation Foundation

Since September 2005 CEO Marianne

Since Februar 2006 Board member Marianne

Since June 2005 Board member Rossel et Cie

Board member (Belgium and Lille) Rossel et Cie S.A.

Since June 2000 Board member L’Est Républicain

Since March 2004 Board member Network of National Museums




Mr Eric Albrand, Member of the Management Board Year Positions held and functions performed within the Group Company Name

2002 Director FCI Microconnections since 26/04/2002

FCI Connectors UK Ltd since 08/07/2002 Slivarente

2003 Director

Director/« Geschäftsführer »

Company secretary

Treasurer and secretary

Manager

Apoderado

Altran (Switzerland) S.A. since 10/11/2003

Altran Belgium S.A. since 24/04/2003

Altran Consulting Solutions, Inc. since 28/04/2003

Altran Consulting Systems, Inc. since 28/04/2003

Altran Luxembourg S.A. since 13/06/2003

Altran Technologies, Inc. since 03/06/2003

Altran USA, Inc. since 28/04/2003

Arthur D. Little North America, Inc. since 28/04/2003

Arthur D. Little, Inc since 28/04/2003

FCI Microconnections until 29/04/2003

FCI Connectors UK Ltd until 01/03/2003

Slivarente

Altran Austria GmbH since 20/10/2003

Altran Deutschland GmbH since 13/05/2003

Altran Holdings (Singapore) Pte Ltd since 23/04/2003

Altran International B.V. since 11/06/2003

Altran Ireland Ltd. since 23/04/2003

Altran Italia, S.R.L. since 16/05/2003

Altran Netherlands B.V. since 11/06/2003

Altran Portugal S.G.P.S. Ltda. since 21/05/2003

Altran UK Ltd. since 23/04/2003

International Business Development Ltd. since 12/06/2003

Altran Ireland Ltd since 23/04/2003





ACS Holdings, L.L.C. since 28/04/2003

Ubica Solutions, S.L. since 17/09/2003

2004 Director Altran (Switzerland) S.A. since 10/11/2003







Altran USA Holdings, Inc. since 09/11/2004


Arthur D. Little, Inc. since 28/04/2003

Slivarente




Year Positions held and functions performed within the Group Company Name2004 Director/« Geschäftsführer »

Company secretary


Manager

Apoderado















Altran Corporation since 05/01/2004




Strategy Consultors C.P.O.E., S.L. since 03/03/2004

2005 Director

Director /« Geschäftsführer »/Managing Director

« Consejero delegado »








Altran USA Holdings, Inc. since 09/11/2004


Arthur D. Little, Inc. since 28/04/2003



Altran Estudios Servicios y Proyectos, S.L. since 27/07/2005








CGS Executive Search S.A.RL since 06/07/2005

Ethnos S.A.RL since 06/07/2005


Altran Luxembourg S.A. dans la société DCE Consultants Luxembourg

S.A. since 30/05/2005

Altran Technologies S.A. dans la société Altran




Year Positions held and functions performed within the Group Company Name2005 Company secretary


Manager

Apoderado



Altran Consulting Solutions since 28/04/2003


Altran Corporation since 05/01/2004




Strategy Consultors C.P.O.E., S.L. since 03/03/2004

2006 Director

Director /« Geschäftsführer »/Managing Director /

« Consejero delegado »

Representative of

Company secretary




Altran Usa Holdings, Inc. since 09/11/2004



Altran Estudios Servicios y Proyectos, S.L. since 27/07/2005








CGS Executive Search S.A.RL since 06/07/2005 et jusqu’au

29/12/2006

Ethnos S.A.RL since 06/07/2005


Altran Luxembourg S.A. dans la société DCE Consultants Luxembourg

S.A. since 30/05/2005

Altran Technologies S.A. dans la société Altran Luxembourg S.A. since 31/05/2005






Mr. Dominique de Calan, Chairman of the Supervisory Board

Year – Start and end datesPositions held and Functions performed in any

company outside of the Altran Group Company17/12/2002 Director

Director

Giat Industries

ADEPT

28/03/2002 Auditor

Director

Brittany Ferries

AGIRC

27/06/2002 Vice-President

Vice-President

Vice-President

Vice-President

Founding Member-Treasurer

Member of the Supervisory Board

Director

Director

Vice-President

Deputy Managing Director

GIE AGIRC-ARRCO

APEC

AFPA

UNPMI (CGPME)

AREAT

Bretagne Développement

Sabemen

SDR de Bretagne

OPCAIM

UIMM

16/10/2002 Vice-President ETHIC

2003 Director

Director

Giat Industries

ADEPT

28/03/2003 (renewed) Auditor

Director

Vice-President

Vice-President

Vice-President

Vice-President

Brittany Ferries

AGIRC

GIE AGIRC-ARRCO

APEC

AFPA

UNPMI (CGPME)

Mai 2003 Chairman


Director

Director

President


Vice-President

AREAT

Bretagne Développement

Sabemen

SDR de Bretagne

OPCAIM

UIMM

ETHIC

2004 Director

Director

Auditor

Giat Industries

ADEPT

Brittanny Ferries

29/01/2004 Chairman AGIRC

22/06/2004 Chairman

Vice-President

Vice-President

Vice-President

Subsitute Director

GIE AGIRC-ARRCO

APEC

AFPA

UNPMI (CGPME)

FUP

09/12/2004 Chairman AREAT

30/06/2004 fin Member of the Supervisory Board Bretagne Développement

2004 fin Director Sabemen





company outside of the Altran Group Company27/05/2004 end President

Director


Vice-President

OPCAIM

SDR de Bretagne

UIMM

ETHIC

28/07/2005 (renewed) Director

Director

Auditor

Chairman

Chairman

Vice-President

Vice-President

Vice-President

Substitute Director

Chairman

Vice-President


Giat Industries

ADEPT

Brittanny Ferries

AGIRC

GIE AGIRC-ARRCO

APEC

AFPA

UNPMI (CGPME)

FUP

AREAT

OPCAIM

UIMM

Depuis 26/01/2005 Director

Vice-President

CTIP

ETHIC

2006

10/03/2006

28/06/2006

Director

Director

Auditor

Vice-President

Vice-President

Vice-President

Vice-President

Vice-President

Substitute Director

Chairman

Vice-President


Director

Vice-President

NEXTER (ex Giat Industries)

ADEPT

Britanny Ferries

AGIRC

GIE AGIRC-ARRCO

APEC

AFPA

UNPMI (CGPME)

FUP

AREAT

OPCAIM

UIMM

CTIP

ETHIC




Mr. Michel Sénamaud, Vice-Chairman of the Supervisory BoardYear Positions held and Functions performed Company

2002 Chairman

Director


Management Board Member

SAS Franpresse

SAS Sodinfor

SA Cadremploi

SA Explorimmo

SA Presse Nord

SA Publiprint

SASP Football Club de Nantes

SA S.A.LT

SA Société du Figaro

SA Soden

SA Figaro Holding

SA Société de gestion du Figaro

SA Socpresse

2003 Chairman

Director



SAS Franpresse

SAS Sodinfor

SA Cadremploi

SA Editions Génération

SA Explorimmo

SA Presse Nord

SA Publiprint


SA Salt


SA Figaro Holding

SA Groupe Express Expansion

SA Socpresse

SA Société de gestion du Figaro

2004 Chairman

Director

General Director



SAS Franpresse

SAS Sodinfor

SA Cadremploi

SA Editions Génération

SA Explorimmo

SA Presse Nord

SA Publiprint


SA Salt



SA Figaro Holding

SA Groupe Express Expansion

SA Socpresse

SA Société de Gestion du Figaro

2005 No Position was held or function performed outside of Altran Technologies

2006 No Position was held or function performed outside of Altran Technologies




Mrs. Guylaine Saucier, Member of the Supervisory Board until 15 February 2007


company outside of the Altran Group Company2002

Since 1991

From 1997 to 2005

Since 1987

Since 1992

From 1991 to 2005

Director

Director

Director

Director

Director

Petro – Canada

Nortel Networks

Axa Canada

Banque de Montréal

Tembec Inc.

2003

Since 1991

De 1997 to 2005

Since 1987

Since 1992

From 1991 to 2005

Director

Director

Director

Director

Director

Petro – Canada

Nortel Networks

Axa Canada

Banque de Montréal

Tembec Inc.

2004

Since 1991

From 1997 to 2005

Since 1987

Since 1992

From 1991 to 2005

Director

Director

Director

Director

Director

Petro – Canada

Nortel Networks

Axa Canada

Banque de Montreal

Tembec Inc.

2005

Since 1991

From 1997 to 2005

Since 1987

Since 1992

De 1991 à 2005

Since 2005

Director

Director

Director

Director

Director

Director

Petro – Canada

Nortel Networks

Axa Canada

Banque de Montréal

Tembec Inc.

CHC Helicopter

2006

Since 1991

From 1997 to 2005

Since 1987

Since 1992

From 1991 to 2005

Since 2005

Since 2006

Director

Director

Director

Director

Director

Director

Director

Petro-Canada

Nortel Networks

Axa Canada

Banque de Montréal

Tembec Inc.

CHC Helicopter

Groupe Areva




Mr. Roger Alibault, Member of the Supervisory BoardYear Positions held and Functions performed Company

2002 CEO Apex – GAEC S.A.



2005 CEO

Manager

Apex – GAEC S.A.

Apex Provence

Apex Fidus Hyères

2006 CEO

Manager

Apex – GAEC S.A.

Apex ProvenceApex Fidus Hyères

Mr. Christophe Aulnette, Member of the Management Board until 24 September 2006Year Positions held and Functions performed Company

2002 Manager SARL Microsoft France

2003 Manager

CEO

SARL Microsoft France

Microsoft France (converted to S.A.S on 30 April 2003)

2004 CEO SAS Microsoft France

2005 Chairman

Permanent Representative of Altran Technologies

Chairman

CEO

Altran France Executive Management S.A.S since 21/10/2005

At the Board of Directors of the company Axiem since 12 July 2005

Fondation pour l’innovation

Microsoft France until 18/02/2005

2006 Chairman

Chairman

Fondation Altran pour l’Innovation until 23 September 2006

Altran France Executive Management until 23 September 2006

Mr. François-Xavier Floren, Member of the Management Board from 8 June 2006 to 20 November 2006Year Positions held and Functions performed Company

2005 25/10/2005 « Sole Director » Altran USA Holding, Inc.

2006

Since 6 june 2006 Chairman of the Board and Executive Di rector Cerri Consulting



Potential conflicts of interest involving Members of the Board of Directors or the Supervisory Board

14.2 CONVICTIONS FOR FRAUD, LIQUIDATION PROCEEDINGS OR SANCTIONS AFFECTING MEMBERS OF ADMINISTRATION UNITS

To Altran Technologies’ knowledge, within the past fi ve year, no Members of the Board of Directors or the Supervisory Board have:

been the subject of a conviction for fraud;

been involved in bankruptcy, receivership or court-ordered liquidation proceedings;

been convicted or the subject of offi cial, public sanctions on behalf of a statutory or regulatory authority (including designated professional associations).

a

a

a

To Altran Technologies’ knowledge, no Members of the Board of Directors or the Supervisory Board have, within the past fi ve years, been prohibited by the courts from acting as a Member of an administration, management or supervisory unit of an issuer or intervening in the management or execution of an issuer’s business activities.

14.3 POTENTIAL CONFLICTS OF INTEREST INVOLVING MEMBERS OF THE MANAGEMENT BOARD OR THE SUPERVISORY BOARD

To Altran Technologies’ knowledge:

there are no confl icts of interest involving Members of the Board of Directors or the Supervisory Board between their obligations toward Altran Technologies and their private and/or other obligations;

said Members are not related.

a

a


15.1 REMUNERATION OF CORPORATE REPRESENTATIVES

The gross remunerations and other benefi ts awarded to corporate representatives during 2006 by the company or its subsidiaries stand at 3,779,789.62 euros:

Remuneration of corporate representatives: 1,344,491.18 euros;

a

Remuneration awarded under employment agreements: 2,012,798.44 euros;

Directors’ fees: 422,500.00 euros;

Benefi ts in kind: N/a.

a

a

a

15.1.1 Members of the Management Board

Mr Yves de Chaisemartin – Chairman of the Management Board With regard to his mandate of Chairman of the Supervisory Board from 1 January 2006 to 24 September 2006.

Gross non-recurring remuneration paid by the company: €94,791.65

Gross remuneration paid by a controlled company: None

Benefits in kind granted by the company: None

Attendance fees paid by the company for services as member and Chairman of the Supervisory Board: 52,500.00 €

With regard to his mandate of Chairman of the Management Board from 24 September 2006 to 31 December 2006:

Gross fixed remuneration paid: € 53,889.00

Benefits in kind granted by the company: None

Gross variable remuneration for the 2006 fiscal year paid by the company in April 2007 : 62,500.00 €

In order to calculate the variable remuneration, half of the total, maximum envelope was used, thus 500,000 euros, adjusted in proportion to time.

There are four criteria taken into account for the award of variable remuneration:

EBIT;

the increase in revenue;

the strategy;

the success of merger operations in France.

a

a

a

a

15 Remuneration and benefi ts

15.1 REMUNERATION OF CORPORATE REPRESENTATIVES 52

15.1.1 Members of the Management Board 52

15.1.2 Members of the Supervisory Board 55

15.2 COMMITMENTS MADE BY THE COMPANY TOWARD ITS CORPORATE REPRESENTATIVES 55

15.3 TABLE OF STOCK-OPTIONS AWARDED TO CORPORATE REPRESENTATIVES 56


15Remuneration and benefi ts

Mr Eric Albrand – Member of the Management Board :

(Including 260,000 euros in variable salary for 2005 activities) €620,000.00

Gross remuneration paid by a controlled company for appointed positions: None

Gross variable remuneration for the 2006 fiscal year paid by the company in April 2007 for appointed positions: €150,000.00

Benefits in kind granted by the company for appointed positions: None

There are three criteria taken into account for the award of variable remuneration, corresponding to a total envelope of 300,000 euros:

EBIT;

an increase of margins;

involvement in the Group’s strategy.

Mr Christophe Aulnette’s employment contract was suspended when he was appointed corporate representative and re-established when he resigned from his mandate of Chairman and Member of the Management Board on 23 September 2006.

The terms of the contract include the award of the following indemnities in the event it is terminated:

(i) 36 months salary in the event of a termination within 24 months of the date on which the employment contract comes into effect;

(ii) 24 months salary if the contract is terminated within the subsequent 24-month period.

a

a

a

With regard to the transactional agreement concluded between the company and Mr Christophe Aulnette, the company has paid the latter an amount of 1,553,534.82 euros.

Furthermore, the same transactional agreement stipulates remuneration pertaining to a non-competition clause representing a gross, monthly payment of 45,333.33 euros.

The amount paid in 2006 was 102,755.55 euros.

Remuneration of corporate representatives

In order to calculate the variable remuneration, half of the total, maximum envelope was used, thus 300,000 euros.

There are four criteria taken into account for the award of variable remuneration:

EBIT;

internal monitoring;

a

a

strategy;

the cash-fl ow position.

Mr Éric Albrand, whose employment agreement was suspended when he was appointed corporate representative, will be awarded an indemnity of 24 months salary in the event this contract is terminated upon expiration of his mandate.

a

a

Mr Christophe Aulnette – Chairman of the Management Board from 30 June 2005 to 24 September 2006

Gross remuneration paid by the company in 2006 for appointed positions: (of which 28 0,000 euros in variable salary for 2005 activities) €573,339.20

Gross variable remuneration for appointed positions for the 2006 fiscal year: None

Gross non-recurring remuneration paid by the company for appointed positions: None



Gross compensation for employment contract beginning on 24 September 2006: €32,223.80



Mr François-Xavier Floren – Member of the Management Board from 8 June 2006 to 20 November 2006Gross, fi xed remuneration paid by the company with regard to his employment contract from 1 January 2006 to 7 June 2006.

Fixed remuneration: €110,833.00

Gross variable remuneration paid by the company for the 2005 fiscal year: €70,000.00

Gross variable remuneration paid for the first semester of 2006: €56,257.00

Gross remuneration paid by the company with regard to his corporate mandate from 8 June 2006 to 20 November 2006

Gross fixed remuneration: €128,333.00

Gross variable remuneration: €79,138.00


There are two criteria taken into account for the award of variable remuneration in the amount of 79,138 euros, corresponding to a total envelope of 250,000 euros if criteria are met in full:

41,638 euros with regard to the Group’s EBIT;

37,500 euros with regard to his contribution to the Group’s strategy.

Mr François-Xavier Floren’s employment contract was suspended when he was appointed corporate representative and re-established following his resignation from the Management Board on 20 November 2006.

a

a

The terms of the contract include the award of the following indemnities:

(i) 24 months salary in the event of a termination within 24 months of the date on which the employment contract comes into effect;

(ii) 12 months salary if the contract is terminated within the subsequent 24-month period

in the event it is terminated.

When his contract was terminated, Mr François-Xavier Floren was awarded the following amounts:

Lump sum compensation (gross) for paid leave €50,568.27

Advance notification waiver (gross) paid through 11 February 2007 to which is added a seniority premium of 43 euros €106,583.00

There was no transactional indemnity awarded following his resignation. On 8 March 2007, Mr François-Xavier Floren petitioned

the Paris labour arbitration authorities (Prud’hommes) to request the payment of the contractual indemnities he claims he is entitled to.



15Remuneration and benefi ts

15.1.2 Members of the Supervisory Board

Mr. Dominique de Calan – Chairman of the Supervisory Board

Gross non-recurring remuneration paid by the company for appointed positions: €32,500.33



Attendance fees paid by the company for services as member and Chairman of the Supervisory Board €80,000.00

Mr. Michel Sénamaud – Vice-Chairman of the Supervisory Board

Gross non-recurring remuneration paid by the company for appointed positions: €90,000.00



Attendance fees paid by the company for services as member and Vice-Chairman of the Supervisory Board: €70,000.00

Mr. Roger Alibault – Member of the Supervisory Board

Attendance fees paid by the company for services as member of the Supervisory Board: €70,000.00

Madame Guylaine Saucier – Member of the Supervisory Board

Attendance fees paid by the company for services as member of the Supervisory Board: €150,000.00

15.2 COMMITMENTS MADE BY THE COMPANY TOWARD ITS CORPORATE REPRESENTATIVES

No commitments have been made toward Members of the Management Board corresponding to remuneration, fi nancial compensation or advantages likely to be awarded should a representative cease to be

in offi ce or should his or her functions be amended excepted elements disclosed in section 15.1 ”Remuneration of corporate representatives” of the present reference document.




15.3 TABLE OF STOCK-OPTIONS AWARDED TO CORPORATE REPRESENTATIVES

Table of stock-options awarded to corporate representatives

No Members of the Management Board or the Supervisory Board were awarded stock-options in 2006.

All stock-options awarded to managers and employees are subscription options on new share issues.

Altran Technologies stock options granted to Mr. Christophe Aulnette, Chairman of the Management Board until 24 September 2006

Plan of 15 June 2005 Plan of 20 December 2005

Exercise price 7.24 9.62

Expiration date 15 June 2013 20 December 2013

Options granted during the year 200,000 120,000

Options granted during the year

Existing options as of 31 December 2005 200,000 120,000

When he left the company, Mr Christophe Aulnette forfeited his entitlement to share subscription options.

Altran Technologies stock options granted to Mr Éric Albrand, Member of the Management Board

Plan of 11 March 2003 Plan of 24 June 2003 Plan of 29 June 2004 Plan of 20 December 2005

Exercise price 2.97 6.73 9.37 9.62

Expiration date 11 March 2011 24 June 2008 29 June 2012 20 December 2013

Options granted during the year 42,693 106,734 80,000 90,000

Options granted during the year - - - -

Existing options as of 31 December 2005 42,693 106,734 80,000 90,000

Existing options as of 31 December 2006 42,693 106,734 80,000 90,000

Altran Technologies stock options granted to Mr François-Xavier Floren, Member of the Management Board from 8 June to 20 November 2006

Plan of 20 December 2005

Exercise price 9.62

Expiration date 20 December 2013

Options granted during the year 90,000

Options granted during the year -

Existing options as of 31 December 2005 90,000

When he left the company, Mr François-Xavier Floren forfeited his entitlement to share subscription options.

Mr Yves de Chaisemartin, Chairman of the Management Board , was not awarded stock-options in 2006.


Information concerning the operation of management and supervisory units is presented in the report prepared by the Chairman of the Supervisory Board concerning the conditions under which the works

of the Board are prepared and organised and internal monitoring procedures can be found in appendix 1 of this reference document.

16 Operation of management and supervisory units


17.1 INFORMATION ON EMPLOYEES

17.1.1 Evolution of staff numbers

The total number of employees at 31 December 2006 was 17,057 as presented in further detail hereafter.

16,446 16,37816,282

16,129 16,152

+ 129

+ 207

+ 228

+ 341

16,281

16,488

16,716

17,057

dec-04 march-05 june-05 sept-05 dec-05 march-06 june-06 sept-06 dec-06

17.1.2 Invoicing rates

Pursuant to commitments made at the time 2004’s fi nancial results were, the Group has requested that the monthly invoicing rates of the subsidiaries be analysed by the internal audit department. Additional studies have also been carried out by the Group.

Based on these studies, it would appear that:

the methodology applied when calculating invoicing rates is appropriate;

data records which are not produced by an accounting information system require improvement.

a

a

In collaboration with the audit committee, a task schedule has been defi ned for the up-and-coming quarters in order to improve on these factors which will be the subject of subsequent studies by the internal audit department.

It is feasible to say that, although they could be improved, the current rates published do indeed provide a true image of the Group’s economic activities.

When interpreting the invoicing rates published, it is important to consider comparative data over various periods, information which is currently unavailable.

The average invoicing rate for 2006 is 84.1%, a slight decrease compared to 2006’s second half-year. This decrease in 2006’s invoicing rate is mainly due to France’s dwindling activity levels. Here below is further detail of the invoicing rate for 2006:

Q4 2005 average

H 2 2005 average

2005 average

Q1 2006 average

Q2 2006 2006

averageH 1 2006 average

Q3 2006 average

Q4 2006 average

H 2 2006 average

Invoicing rate 85.0% 84.6% 84.1% 83.8% 84.6% 84.2 % 83.8% 84.1% 84.0%

17 Employees


17Employees

17.1.3 Turnover rate

The turnover rate improved during 2006 and stands at 29.0% as compared to 30.8% in 2005.

The Group feels that these levels are too high and is focused on reducing this rate.

It is important to mention that despite a turnover rate that remains too high, the Group is still attracting new engineers as can be seen in the results of a study conducted by Ipsos, Alter Ego and TMPNEO in January 2007 here below:

17.2 EMPLOYEE PROFIT SHARING AND STOCK-OPTIONS

17.2.1 Stock-options

No stock-options were awarded to employees in 2006.

No options from previous plans were exercised in 2006.

All employee stock-option plans launched by Altran Technologies involve the award of share subscription options.

Details of the various share subscription plans are presented in the management report under the section “20.3.1.6.1 Share subscription options” page 106.

The March 2003 plan has been exercisable since 12 March 2007 at a price of 2.97 euros. At 13 April 2007, 429,248 options had been exercised.

Employee profit sharing and stock-options

1 AIRBUS 11 L’OREAL 31 DASSAULT SYSTEMES

2 EADS 12 DASSAULT AVIATION 32 NESTLE

3 PSA 13 AREVA 33 CAPGEMINI

4 EDF 14 SANOFI AVENTIS 34 SAGEM

5 RENAULT 15 IBM 35 SIEMENS

6 VEOLIA 16 BNP PARIBAS 36 STMICROELECTRONICS

7 TOTAL 17 DANONE 37 ARIANESPACE

8 BOUYGUES 18 GOOGLE 38 UNILOG

9 THALES 19 AIR FRANCE – KLM 39 ALCATEL

10 VINCI 20 MICROSOFT 40 AIR LIQUIDE

21 SUEZ 41 MICHELIN

22 SOCIETE GENERALE 42 APPLE

23 SNCF 43 GENERAL ELECTRIQUE

24 FRANCE TELECOM 44 ALSTOM

25 PHILIPS 45 ERNST & YOUNG

26 ALTRAN 46 MC KINSEY

27 SCHNEIDER 47 ALTEN

28 ACCENTURE 48 P&G

29 EIFFAGE 49 BOSCH

30 BMW 50 TOYOTA


17 Employees

17.2.2 Employee profit-sharing

Amounts awarded to employees under profi t-sharing plans for the past years and recognised in the income statement are as follows:

Year Amount (in thousand euros)

1999 8,074

2000 9,669

2001 15,578

2002 2,793

2003 6,209

2004 8,191

2005 7,723

2006 7,971

17.2.3 Stock options awarded to the top-ten, non corporate representative employees

No options were awarded in 2006.

Employee profit sharing and stock-options


18.1 SHAREHOLDERS AND VOTING RIGHTS

There are no shareholders’ agreements.

Identity of physical persons or legal entities owning more than 1/20, 1/10, 3/20, 1/5, 1/4, 1/3, 1/2 or 19 /20 of the share capital or voting rights at General Meetings.

31 December 2004 31 December 2005 31 December 2006Number of

shares % of capitalNumber of

voting rights% of voting

rightsNumber of



rightsNumber of



rights

Alexis Kniazeff 10 570 593 9,24 % 20 239 966 14,46 % 10 570 593 9,24 % 20 239 966 15,12 % 10 570 593 9,01 % 20 239 966 14,72 %Hubert Martigny 10 573 296 9,24 % 20 242 648 14,46 % 10 573 296 9,24 % 20 242 648 15,13 % 10 573 296 9,01 % 20 242 648 14,72 %Altran Directors Funds 7 987 902 6,97 % 14 175 804 10,10 % - - - - - - - -

Flottant 85 310 423 74,54 % 86 144 819 61,19 % 93 298 325 80,82 % 93 348 324 69,75 % 96 172 348 81,98 % 96 989 499 70,56 %

Total 114 442 214 100,00 % 140 803 237 100,00 % 114 442 214 100,00 % 133 830 938 100,00 % 117 316 237 100 % 137 472 113 100 %Total number of shares comprising capital 114 442 214 114 442 214 114 442 214 117 316 237Total number of shares granting access to double voting rights 26 361 023 26 361 023 20 241 307 20 155 876

18.1 SHAREHOLDERS AND VOTING RIGHTS 61

18.2 STATEMENT OF TRANSACTIONS REFERRED TO IN ARTICLE L. 621-18-2 OF THE FRENCH MONETARY AND FINANCIAL CODE DURING 2006 62

18.3 COMPANY’S BUYBACK OF ITS OWN SHARES 62

18.4 THE MARKET FOR ALTRAN TECHNOLOGIES SECURITIES 63

18.4.1 The Altran Technologies share 63

18.4.2 Evolution of ADR (American Depositary Receipt) Altran Technologies since 1 January 2006 64

18.4.3 Evolution of the convertible bond loan repayable 1 January 2009 since 1 January 2006 65

18.5 INFORMATION CONCERNING ELEMENTS USED TO CALCULATE ADJUSTMENTS TO BOND CONVERSION BASES AND AMEND CONDITIONS FOR THE SUBSCRIPTION AND THE EXERCISE OF SECURITIES CONFERRING A RIGHT IN THE SHARE CAPITAL 65

18 Main shareholders



In a letter dated 27 October 2006, we were informed that Matignon Développement 3, whose portfolio is managed by Axa Investment Managers Private Equity Europe, had exceeded the threshold of 5% of share capital owned. Matignon Développement 3 currently owns 6,217,830 shares representing 5.3% of the share capital and 4.55% of voting rights.

In a letter dated 28 December 2006, we were informed that the company ”Financière de l’Echiquier” had exceeded the threshold of 5% of share capital owned. The company ”Financière de l’Echiquier” currently owns 5, 879,500 shares representing 5.01% of the share capital and 4.28% of voting rights.

To the company’s knowledge, no other shareholders have declared that they are in excess of the threshold of 1/20 of the company’s share capital or voting rights.

Controlled companies and portion of Altran Technologies’ share capital owned by these companies (self-owned shares)

Not applicable.

Employee share ownership

At 31 December 2006, employees owned 3,551,865 shares, thus 3% of the company’s share capital and 2.6% of its voting rights. Share ownership is made possible by means of three company investment funds (FCPE).

The increase of employee ownership of Altran’s share capital for 2006 is linked to the share ownership plan launched during the fi rst half of the year under which company employees subscribed to almost 2.3% of the share capital.

It is important to note that this transaction was leveraged by way of a loan of the 1,785,000 shares invested in the FCPEs to the bank having handled the transaction. The Group’s various FCPEs are therefore able to exercise the voting rights attached to 1,766,865 shares representing 1.5% of the company’s share capital and 1.3% of its voting rights.

As for the bank, it has made to the commitment to take all reasonable measures, as so permitted by market conditions, to re-assign the shares in question to the FCPEs at the General Meetings thus enabling the FCPEs to exercise all voting rights attached to their respective interests.

18.2 STATEMENT OF TRANSACTIONS REFERRED TO IN ARTICLE L. 621-18-2 OF THE FRENCH MONETARY AND FINANCIAL CODE DURING 2006

On 24 April 2006, Mr Michel Sénamaud, Member of the Supervisory Board, purchased 3,000 shares in the company for a gross amount of 34,800 euros. This transaction was the subject of a memo addressed to France’s fi nancial market authority (Autorité des Marchés Financiers).

On 10 April 2006, Mr Christophe Aulnette, Member of the Board of Directors until 24 September 2006, purchased 5,078 shares at a unit price of 11.86 euros, thus a total of 60,235.14 euros.

This transaction was the subject of a memo addressed to France’s fi nancial market authority (Autorité des Marchés Financiers).

October 2006, Mr Yves de Chaisemartin, Chairman of the Management Board , purchased 158,000 shares at a unit price of 6.36 euros, thus a total of 1,006,302 euros. This transaction was the subject of a declaration submitted to France’s fi nancial market authority (Autorité des Marchés Financiers).

18.3 COMPANY’S BUYBACK OF ITS OWN SHARES

The Ordinary General Meeting held 8 June 2006:

ended, effective immediately and for the unused portion, the authorisation enabling the company to buy back its own shares granted by the Combined General Meeting of 29 June 2005;

a

authorised, under its 5th resolution, the company to trade its shares on the market for price regulation purposes. To date, the company has not exercised this authorisation.

a

Company’s buyback of its own shares


18Main shareholders

18.4 THE MARKET FOR ALTRAN TECHNOLOGIES SECURITIES

18.4.1 The Altran Technologies share

Average volume per session

Average price (in euros)

High (in euros)

Low (in euros)

Average volume traded(in thousands of euros)

January 2006 796,039 10.82 11.43 9.48 1,269.1

February 2006 578,635 11.54 12.14 11.01 1,354.3

March 2006 553,596 11.46 12.00 10.95 1,344.1

April 2006 845,290 11.65 12.60 11.34 1,366.7

May 2006 943,513 10.68 11.85 9.55 1,252.7

June 2006 669,382 9.24 10.04 8.67 1,083.5

Jul. 2006 610,267 8.90 9.78 8.11 1,043.8

August 2006 1,708,696 7.15 9.03 6.51 839.4

Sep. 2006 1,411,243 6.90 7.63 6.13 809.7

Oct. 2006 2,115,318 6.99 7.75 6.27 819.7

Nov. 2006 1,008,659 7.20 7.64 6.73 844.2

Dec. 2006 933,143 7.02 7.34 6.62 824.0

January 2007 1,420,626 6.99 7.53 6.58 819.9

February 2007 1,233,635 6.96 7.22 6.38 817.0

March 2007 1,282,908 6.76 7.05 6.28 793.5

1,074,063 8.68 12.60 6.13

Source: Reuters.

Capitalisation is calculated on the basis of 117,320,000 shares.

The market for Altran Technologies securities

dec-05 feb-06 apr-06 june-06 aug-06 oct-06 dec-06 févr-07

6,00

7,00

8,00

9,00

10,00

11,00

12,00

13,00AltranCAC 40

Source : Bloomberg



18.4.2 Evolution of ADR (American Depositary Receipt) Altran Technologies since 1 January 2006

Altran Technologies is also listed in American dollars on the United States’ market via a level-one ADR (American Depositary Receipt) under the code 02209U108.

Information concerning elements used to calculate adjustments to bond conversion bases and amend conditions for the subscription and the exercise of securities conferring a right in the share capital

Average volume per session

Average price (in euros)

High (in euros)

Low (in euros)

Average volume traded(in thousands of euros)

January 2005 4, 270 1. 25 1. 45 1. 03 5, 337. 1

February 2005 532 1. 49 1. 50 1. 45 792. 4

March 2005 1, 715 1. 41 1. 50 1. 30 2, 423. 2

April 2005 2, 035 1. 48 1. 60 1. 30 3, 001. 8

May 2005 2, 309 1. 46 1. 55 1. 35 3, 372. 5

June 2005 2, 436 1. 28 1. 46 1. 20 3, 124. 5

Jul. 2005 3, 000 1. 20 1. 20 1. 20 3, 600. 0

August 2005 2, 141 1. 09 1. 20 0. 75 2, 336. 3

Sep. 2005 3, 423 0. 95 1. 02 0. 80 3, 251. 7

Oct. 2005 9, 026 0. 80 0. 80 0. 80 7, 220. 8

Nov. 2005 8, 659 0. 80 0. 90 0. 80 6, 966. 9

Dec. 2005 1, 491 0. 92 0. 99 0. 90 1, 370. 8

January 2006 1, 455 0. 98 0. 99 0. 95 1, 424. 1

February 2006 4, 000 0. 95 0. 95 0. 95 3, 800. 0

March 2006 4, 000 0. 95 0. 95 0. 95 3, 800. 0

3, 366 1. 13 1. 60 0. 75

Source : Reuters

0,6

0,9

1,2

1,5

jan-05 feb-05 march-05 apr-05 may-05 june-05 july-05 aug-05 sept-05 oct-05 nov-05 dec-05 jan-06 feb-06 march-06

Change in average price of Altran ADR since January 2005

The market for Altran Technologies securities


18Main shareholders

18.4.3 Evolution of the convertible bond loan repayable 1 January 2009 since 1 January 2006

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12

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14

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nov-04 feb-05 may-05 aug-05 nov-05 feb-06 may-06 aug-06 nov-06 feb-07

Information concerning elements used to calculate adjustments to bond conversion bases and amend conditions for the subscription and the exercise of securities conferring a right in the share capital

18.5 INFORMATION CONCERNING ELEMENTS USED TO CALCULATE ADJUSTMENTS TO BOND CONVERSION BASES AND AMEND CONDITIONS FOR THE SUBSCRIPTION AND THE EXERCISE OF SECURITIES CONFERRING A RIGHT IN THE SHARE CAPITAL

Not applicable.


Not applicable..

19 Transactions with related entities


20.1 PAST FINANCIAL INFORMATION

All of the Group’s past fi nancial information pertaining to its assets, fi nancial position and results can be found in the reference documents published in previous years, thus:

a 2002 reference document R03-224 validated by the COB on 31 October 2003;

a 2003 reference document R04-106 validated by the AMF on 7 June 2004;

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a 2004 reference document R05-091 validated by the AMF on 14 June 2005;

a 2005 reference document submitted to the AMF on 29 May 2006.

All of these documents may be viewed at the following website: www.altran.com.

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20.2 PRO-FORMA INFORMATION

Not applicable.

20 Financial information concerning the issuer’s assets, fi nancial position and results

20.1 PAST FINANCIAL INFORMATION 67

20.2 PRO-FORMA INFORMATION 67

20.3 FINANCIAL STATEMENTS 68

CONSOLIDATED ACCOUNTS 68

Balance sheet - Assets 68

Balance sheet - Liabilities 69

Income statement 70

Equity Variations 71

Cash-Flow statement 72

APPENDICES OF THE CONSOLIDATED ACCOUNTS 75

FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS 118

1. Financial statements at 31 December 2006 119

2. Accounting notes to the financial statements at 31 December 2006 121

20.4 VERIFICATION OF THE ANNUAL FINANCIAL INFORMATION 137

20.5 LATEST FINANCIAL INFORMATION 137

Outlook 138

20.6 INTERMEDIARY AND OTHER FINANCIAL INFORMATION 138

20.7 DIVIDEND DISTRIBUTION POLICY 138

20.8 LEGAL AND ARBITRATION PROCEEDINGS 138

20.9 SIGNIFICANT CHANGES TO THE FINANCIAL OR COMMERCIAL POSITION 138


20 Financial information concerning the issuer’s assets, fi nancial position and resultsFinancial statements

20.3 FINANCIAL STATEMENTS

CONSOLIDATED ACCOUNTS

Balance sheet - Assets

(in thousand euros) Notes

December 2006 December 2005 December 2004

Gross value Amort. prov. Net values Net values Net values

Consolidated goodwill 4.1 706,468 (214,523) 491,945 500,090 479,043

Reconciliation gains/losses on FC intangibles - -

Intangible assets 4.2 62,323 (20,938) 41,385 39,881 40,965

Land 533 533 533 533

Construction 17,341 (7,542) 9,799 10,241 10,680

Assets held in direct financing leases - -

Other fixed assets 92,000 (59,344) 32,656 27,680 33,611

Reconciliation gains/losses on FC tangibles - -

Fixed assets 4.3 109,874 (66,886) 42,988 38,454 44,824Participating interests entered using the equity method (242) (242) (457) 8

Non-current financial assets 4.4 32,140 (2,173) 29,967 25,600 26,197

Reconciliation gains/losses on FC securities - -Reconciliation/elim. of holdings in consolidated subsidiaries - -

Deferred tax assets 5.9 99,646 (40,150) 59,496 58,468 59,149

Non-current payable tax assets 5.9 120 120 854 21,393

Other non-current assets 4.5 7,686 (5,743) 1,943 2,182 5,289

Total non-current assets 1,018,015 (350,413) 667,602 665,072 676,868

Inventory and work in process 1,201 (64) 1,137 1,998 2,431

Amounts paid on account 1,028 1,028 906 1,704

Accounts receivable (client ) 4.6 527,043 (15,854) 511,189 433,072 414,605

Other receivables (non-trade) 4.7 70,536 (2,426) 68, 11 0 74,938 65,264

Client accounts and other receivables 598,607 (18,280) 580,327 508,916 481,573

Current financial assets 4.8 1,048 (174) 874 552 1,359

Cash equivalents 4.10 54,709 (9) 54,700 61,069 327,332

Cash 4.10 71,526 71,526 102,043 70,346

Total current assets 727,091 (18,527) 708,564 674,578 883,041

Total assets 1,745,106 (368,940) 1,376,166 1,339,650 1,559,909


20Financial information concerning the issuer’s assets, fi nancial position and results

Financial statements

Balance sheet - Liabilities

(in thousand euros) Notes December 2006 December 2005 December 2004

Capital 4.10 58,658 57,221 57,221

Share premiums 214,881 162,790 158,931

Reserves assignable to shareholders in the parent company 100,604 118,707 87,036

Translation differences 4,870 8,287 (498)

Earnings for fiscal year/period 3,787 231 16,906

Minority interest 125 312 121

Shareholder’s equity III & 4.10 382,925 347,548 319,717

Convertible bond loans (> 1 year) 214,487 207,515 230,000

Credit establishment borrowings and debts (> 1 year) 59,565 72,293 21,292

Other non-current financial liabilities 12,781 17,251 17,184

Non-current financial liabilities 4.11 286,833 297,059 268,476

Provisions for long term liabilities and charges 4.12 11,519 14,121 13,272

Long-term personnel benefits 4.13 27,469 23,374 38,986

Deferred tax liabilities 5.9 11,300 8,265 5,741

Other long-term liabilities 4.14 203 2,557 606

Other non-current liabilities 50,491 48,317 58,605

Total non-current liabilities 337,324 345,376 327,081

Accounts payable 4.15 74,022 53,258 57,839

Taxes payable 90,641 99,144 104,446

Current personnel benefits 4.13 184,012 170,176 148,771

Debts on assets 1,085 1,150 821

Other current debts 4.16 39,331 29,656 27,202

Suppliers accounts and other current payables 389,091 353,384 339,079

Provisions for short-term liabilities and charges 4.12 39,793 49,905 44,827

Debts on short-term securities 4.17 7,777 40,440 20,652

Current financial liabilities 4.11 219,256 202,997 508,553

Total current liabilities 655,917 646,726 913,111

Total liabilities 1,376,166 1,339,650 1,559,909



Income statement

(in thousand euros)December 2006



(12 months)

Turnover 1,495,350 1,434,473 1,395,633

Other income from operations 2,901 3,457 5,375

Income from ordinary operations 1,498,251 1,437,930 1,401,008

Raw materials (15,517) (13,121) (16,049)

Variation in work-in-process (847) (414) (43)

External expenses (319,925) (309,516) (295,585)

Staff costs (1,035,366) (987,330) (991,848)

Staff costs - payment in shares (6,333) (4,139) (2,478)

Taxes and duties (10,783) (12,425) (14,504)

Net depreciation and provisions (22,130) (9,216) (11,744)

Other operating income and charges (11,365) (8,519) (9,509)

Current operating profit (loss) 75,985 93,250 59,248

Other non-recurring operating income 40,718 45,699 53,725

Other non-recurring operating charges (55,374) (83,662) (17,123)

Other non-recurring operating income and charges (14,656) (37,963) 36,602

Goodwill amortization (15,880) (26,463) (25,581)

Operating profit (loss) 45,449 28,824 70,269

including goodwill amortization (15,880) (26,463) (25,581)

Income from cash and cash equivalents 2,916 2,249 4,487

Gross cost of debt (26,010) (24,209) (21,609)

Net cost of debt (23,094) (21,960) (17,122)

Other financial revenue 4,761 17,943 10,271

Other financial expenses (7,766) (18,034) (16,559)

Tax expenses (15,805) (6,166) (29,508)

Equity share in net income of affiliates 110 (393) (85)

Net profit (loss) before net effect of ceased operations or operations currently being ceased 3,655 214 17,266

Net profit (loss) on ceased operations or operations currently being ceased -

Net earnings 3,655 214 17,266

Minority interest 132 17 (360)

Group net earnings 3,787 231 16,906

Earnings per share 0.03 0.00 0.15

Diluted earnings per share 0.03 0.00 0.15




Equity Variations

(in thousand euros)Number of

shares Capital Premiums Reserves

Fair value adjustments

and otherTranslation differences Net earnings

Total Group share

Minority interest Total

31 December 2003 57,221 156,413 178,792 - (92,042) 300,384 (19) 300,365

Capital operations - -

Payments in shares 531 - 531 531

Translation differences (191) 5 700 5 509 5,509

Earnings for the year (5,772) (5,772) 343 (5,429)

Allocation of earnings (92,042) 92,042 - -

Other transactions - (324) (324)

30 June 2004 57,221 156,944 86,559 - 5 700 (5,772) 300,652 - 300,652

Settling - - - - -

Capital transactions -

Payments in shares 2,518 2,518 2518

Translation differences 286 (498) (212) 212)

Earnings for the year 16,906 16,906 360 17,266

Allocation of earnings (92,042) 92,042 - -

Other transactions (220) (220)

December 31, 2004 57,221 158,931 87,036 - (498) 16,906 319,596 121 319,717

Settling - - - - - -Cambridge Consultant incubator 7,604 7,604 7,604

OCEANE 2009 16,008 16,008 16,008Construction efforts loan (1,449) (1,449) (1,449)

Changes in value recorded directly in shareholder’s equity regarding IAS 32/39 as of January 1st 2005 - - - 22,163 - - 22,163 - 22,163

31 December 2004 114,442,214 57,221 158,931 87,036 - (498) 16,906 319,596 121 319,717Cambridge Consultant incubator 2,448 2,448 2,448

OCEANE 2009 16,008 16,008 16,008Construction efforts loan (1,449) (1,42 9) (1,449)

Translation differences 9,548 9,548 9,548

Changes in value recorded directly in shareholder’s equity - - - 17,027 9,548 - 26,575 - 26,575

Payments in shares 1,691 16,691 1,691



(in thousand euros)Number of

shares Capital Premiums Reserves

Fair value adjustments

and otherTranslation differences Net earnings

Total Group share

Minority interest Total

Net earnings for fiscal year 17,723 17,723 (14) 17,709

Allocation of earnings 16,906 (16,906) - -

Other transactions (1,458) (250) (1,708) 236 (1,472)

30 June 2005 57,221 160,622 102,484 16,777 9,050 17,723 363,877 343 364,220Cambridge Consultantsincubator 2,334 2,334 2,334

OCEANE 2009 16,008 16,008 16,008Construction efforts loans (1,429) (1,429) (1,429)

Translation differences 8,876 8,876 8,876

Changes in value recorded directly in shareholder’s equity - - - 16,913 8,876 - 25,789 - 25,789

Payments in shares 3,859 3,859 3,859Net earnings for fiscal year 231 231 231

Allocation of earnings 16,906 (16,906) - -

Other transactions (2,148) (91) (2,239) 191 (2,048)

31 December 2005 114,442,214 57,221 162,790 101,794 16,913 8,287 231 347,236 312 347,548Cambridge Consultants incubator 1,743 1,743 1,743

OCEANE 2009 145 145 145Construction efforts loans - - -

Translation differences (3,764) (3,764) (3,764)

Changes in value recorded directly in shareholder’s equity - - - 1,888 (3,764) - (1,876) - (1,876)Increase in capital - Spring 2,872,255 1,436 24,578 26,014 26,014

Payments in shares 5,733 5,733 5,733Net earnings for fiscal year 3,787 3,787 (132) 3,655

Allocation of earnings 231 (231) - -

Other transactions 1,768 1 21,780 (20,222) 347 1,906 (55) 1,851

31 December 2006 117,316,237 58,658 214,881 81,803 18,801 4,870 3,787 382,800 125 382,925




Cash-Flow statement

The reconciliation between the gross cash-fl ow amount recorded in the balance sheet and the net cash amount here above was determined as follows:

(in thousand euros) 31 December 2006 31 December 2005

Cash equivalents 54,700 61,069

Cash 71,526 102,043

Bank overdrafts - 1

Net cash flow 126,226 163,113

(in thousand euros)2006

(12 months)2005

(12 months)

Operating profit (loss) 45,449 28,824

Goodwill amortization 15,881 26,463

Operating income before goodwill amortization 61,330 55,287

Net operating depreciation expenses and provisions 3,590 28,897

Income and charges from stock options 6,333 3,859

Gains or losses on disposals 6,718 4,532

Other gains and charges (2,596) 6,892

Cash flow, before net interest expenses and taxes 75,375 99,467

Change in inventory and work in progress 871 381

Change in client accounts and other receivables (94,696) (22,860)

Change in supplier accounts and other payables 49,218 (6,783)

Change in working capital (44,607) (29,262)

Net operating cash flow 30,768 70,205

Interest paid (19,365) (25,084)

Interest received 2,213 1,443

Taxes paid (4,613) 2,607Cash impact of other financial income and expenses 729 (3,028)

Net cash flow generated by business activities 9,732 46,143

Cash outflows for acquisition of fixed and intangible assets (39,892) (14,029)

Cash inflows from disposal of fixed and intangible assets 11,589 1,237

Cash outflows for acquisition of financial assets (non-consolidated holdings) (158)

Cash inflows from disposal of financial assets (non-consolidated holdings) 907 (521)

Outflows associated with earn-outs (41,710) (22,725)

Impact of changes in scope of consolidation (554) 1 162

Dividends received (affiliates, non-consolidated holdings) 11

Change in loans and advances granted (5,615) (3,080)

Investment subsidies received 323 20

Other flows associated with investment transactions 3,195 2,434

Net cash flow generated by investment activities (71,757) (35,649)



(in thousand euros)2006

(12 months)2005

(12 months)

Sums received from shareholders during capital increase 25,415 -

Inflows from new borrowings 42,432 64,994

Reimbursement of loans (30,515) (342,579)

Other flows associated with financing operations (11,627) 31,742

Net cash associated with financing operations 25,705 (245,843)

Impact of variations in exchange rates (566) 783

Impact of changes in accounting principles

Changes in net cash flow 36,886 234,566

Opening cash balance 163,112 397,678

Closing cash balance 126,226 163,112

Net change in cash position (36,886) (234,566)


20

Altran Technologies is a French limited company (société anonyme) subject to all legal provisions governing commercial companies in France, the provisions of the French Commercial Code in particular.

1.1 Basis for the preparation of financial statementsIn application of the European Directive 1606/2002 dated 19 July 2002 concerning international accounting standards, the consolidated accounts for the Altran Technologies Group (“Altran”) for the year ended 31 December 2006 have been prepared according to the IAS/IFRS standards applicable at 31 December 2006 as approved by the European Union and interpreted by the IFRIC. Furthermore, they do not diverge from the IFRS standards published by the IASB.

Optional standards, amendments and interpretations available for application in 2006The following standards, amendments and interpretations will not be applied to the consolidated accounts until 1 January 2007:

IFRS 7 – Financial instruments: disclosures;

Amendment to IAS 1 – Presentation of fi nancial statements – Share capital: disclosures;

IFRIC 7 – Restatement of fi nancial statements under IAS 29;

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IFRIC 8 – Scope of application IFRS 2, share-based payments;

IFRIC 9 – Reassessment of embedded derivatives.

The Group is currently studying the potential impact of these new standards on the notes to the fi nancial statements.

1.2 Initial application of IFRS standardsFor its opening balance sheet as of January 1st 2004, Altran retroactively applied the accounting principles in effect at the closing of the fi rst IFRS fi nancial statements (at 31 December 2005) in the same manner as if said standards had always been applicable, to the exception of those mentioned here above.

Options pertaining to the opening balance sheet at 1 January 2004The IFRS 1 standard included specifi c provisions for the retroactive processing of assets and liabilities under IFRS standards. The main options used by the Group to this effect are as follows:

Regrouping of companies: Altran chose not to restate groupings of companies prior to 1 January 2004 according to the option offered under the IFRS 3 standard.

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1. Accounting rules and methods

Appendices of the consolidated accounts

Accounting rules and methods

APPENDICES OF THE CONSOLIDATED ACCOUNTS

1. Accounting rules and methods 75

2. Scope of consolidation 82

3. Events during 2006 88

4. Notes concerning certain balance sheet items 89

5. Notes to the profit and loss account 101

6. Major litigation and contingent liabilities 111

7. Off-balance sheet commitments 113

8. Transactions between related parties 114

9. Exposure to currency and interest rate risks 114

10. Significant events after 31 December 2006 117


20 Appendices of the consolidated accounts

Intangible fi xed assets and plant, property and equipment: Altran chose to apply the historical value as the basis when valuing intangible fi xed assets and plant, property and equipment rather than valuing these assets at their fair value on the date of transition.

Retirement obligations: actuarial variances recorded at 1 January 2004 were recorded under provisions for retirement obligations against a diminution of shareholders’ equity. Actuarial variances recorded after 1 January 2004 are recognised prospectively.

Foreign exchange gains/losses pertaining to foreign entities: Altran transferred all exchange gains/losses pertaining to foreign subsidiaries at 1 January 2004 to the “Consolidated reserves” account. This adjustment has no impact on the total of shareholders’ equity at 1 January 2004. These variances will only be reinstated in the income statement if the foreign entities in question are excluded from the scope of consolidation.

Share-based payments (stock options): Altran chose to apply the IFRS 2 standard regarding plans awarded after 7 November 2002 and whose rights were not yet acquired at 1 January 2005. Plans awarded prior to 7 November 2002 are neither valued nor recognised in the accounts.

Financial instruments: Altran chose to apply the IAS 32 and IAS 39 standards as of 1 January 2005. The French standard remains in effect for the recognition of fi nancial instruments in the balance sheets at 1 January 2004, 30 June 2004 and 31 December 2004.

1.3 ConsolidationSubsidiaries on which Altran has exclusive control, either direct or indirect, are fully consolidated.

Equity interests that are not controlled by Altran but on which Altran has a notable infl uence are consolidated under the equity method.

1.4 Use of estimationsPreparation of the fi nancial statements requires the use of various estimations and assumptions that may have an impact on certain balance sheet or income statement items and on information provided in certain notes contained in the appendices. Altran ensures that these estimations and appraisals are obtained in a regular manner that accounts for past experience and other factors deemed signifi cant in light of economic conditions. These estimations, assumptions or appraisals are established on the basis of information or situations that exist at the date on which the accounts are prepared and that may differ from the actual, future situation. They mainly involve provisions (51.3 million euros), assumptions upheld for the business plan and used to conduct impairment tests on assets (533 .33 million euros), to deferred tax assets (59,5 million euros) and the estimation of commitments that are not recognised under liabilities concerning positive adjustments on future earnings (2.9 million euros based on an assumption of a 5% annual increase in net earnings for 2007).

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1.5 Translation of the financial statements of foreign entitiesThe Group’s consolidated accounts are prepared in euros.

Translation of the financial statements of foreign entitiesThe balance sheets of companies whose operating currency is not the euro are translated into euros at the exchange rate in effect on the closing date for the income statement and at the average exchange rate recorded over the period for the cash-fl ow statement. Exchange rate variances affecting the income statement are recorded under shareholders’ equity in the “Exchange gains/losses” item.

Goodwill and value adjustments resulting from the acquisition of a foreign entity are considered assets and liabilities of the foreign entity. They are expressed in the entity’s operating currency and translated at the closing exchange rate.

The Group transferred all exchange gains/losses resulting from the translation of foreign subsidiary accounts at 1 January 2004, after consideration of the other IFRS restatement required at that date, to the “Reserves from holders of the parent company’s share capital” (cf. Paragraph 8).

Transactions in foreign currenciesTransactions in foreign currencies are recognised at the exchange rate in effect on the transaction date. At the end of the year, assets and liabilities in foreign currencies are translated at the closing exchange rate.

The relative exchange gains/losses are recorded in the income statement:

under operating earnings for commercial transactions;

under fi nancial earnings for fi nancial transactions.

1.6 Presentation of financial statements

Presentation of the consolidated balance sheetThe IAS 1 standard “Presentation of fi nancial statements” specifi es that current and non-current items are to be distinguished in the balance sheet. Assets and liabilities pertaining to the operating cycle and those that reach maturity in less than twelve months are presented as current items. All other elements are recognised as non-current items.

Deferred tax assets and liabilities are non-current items.

Minority interests are recognised in the consolidated balance sheet under shareholders’ equity.

Presentation of the consolidated income statementThe Group presents its income statement according to the nature of each item.

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20Appendices of the consolidated accounts

Operating earnings represent all income and charges that are neither fi nancial nor related to income tax.

Non-recurring operating income and charges are the result of transactions which, by their very nature, amount and/or frequency, are not considered to be related to the Group’s usual operating activities and earnings.

This particularly involves net income derived from the disposal of minority interests owned by Cambridge Consultants Limited, re-structuring charges, charges or income related to disputes or any other non-recurring element that could affect the comparability of operating earnings on ordinary activities from one year to the next.

Goodwill depreciation is recognised as a non-recurring item in the income statement.

1.7 GoodwillGoodwill is the variance between the acquisition price of consolidated entities or entities accounted for under the equity method and their share in the Group’s net assets, restated on the date on which the equity interest is effective.

The acquisition cost of equity interests includes a fi xed portion paid at the time of acquisition and, in most cases, variable, annual price adjustments calculated according to future earnings of the companies acquired.

Positive price adjustments increase the initial goodwill value.

Earn out to be paid for the year ended are recognised under assets against debt on fi xed assets. Estimations of price adjustments based on future earnings are recorded as an off-balance-sheet item according to various earnings assumptions.

Goodwill is not amortised but is subjected to impairment tests at 31 December each year and at the time of any interim accounts if there is any indication of depreciation.

The impairment test is a valuation of the recoverable value for each cash generating unit (CGU) based on the business value of each entity that contributes to fi xed asset and intangible asset items.

A CGU is the smallest identifi able group of assets whose constant use generates cash infl ows that are largely independent of the general cash infl ows of the Group’s other assets.

In the past, the Group acquired numerous entities throughout many countries and most of these companies have maintained their scope of activity and a relative independence in terms of management. For these companies, a CGU corresponds to the acquired entities (that generate independent cash fl ows).

Where activities are grouped under a single operational branch, the CGU is formed on a national level or on that of a geographical zone.

CGUs identifi ed within the Group are therefore legal entities or operational units, to the exclusion of the following:

where in any given country there is a parent company that owns an operational subsidiary, all entities together constitute a CGU;

where legal entities have shared management and a unifi ed business plan, numerous entities are grouped under a CGU.

Changes to the scope of consolidation are followed up on annually.

A CGU must therefore belong exclusively to one of the geographical zones defi ned by Altran as a primary sector.

The recoverable value is the greatest of either the fair value net of exit costs, where the latter can be defi ned, or the value in use.

The fair value net of exit costs corresponds to the best possible estimation of the net value that could result from a transaction concluded under standard market conditions between informed and willing parties. This estimation is based on available market information with consideration given to the specifi c context.

The value in use applied by Altran corresponds to the value based on the discounted cash fl ows of the CGUs or groups of CGUs. They are determined within the scope of the following economic assumptions and forecasted operating conditions:

the cash fl ows derived from the business plans of the units in question and available on the valuation date, extended for a fi xed period of fi ve years;

beyond that timeframe, the end value corresponding to the indefi nite capitalisation (indefi nite growth rate of 3%) of the fi nal fl ow of the fi xed period is applied;

the discount rate corresponds to the weighted average cost of capital after income tax.

Recoverable values, mainly based on values in use, are compared alongside net book values in order to calculate goodwill depreciation.

Les valeurs recouvrables, essentiellement basées sur les valeurs d’utilité, sont alors comparées aux valeurs nettes comptables pour la détermination des dépréciations des écarts d’acquisition.

1.8 Intangible fixed assetsIntangible assets mainly include trademarks, licences, software and development costs. They are recognised under acquisition or production costs.

TrademarksIdentifi able trademarks that are recognised within groupings of companies and are legally protected are considered intangible fi xed assets. Due to their indefi nite useful lifespan, they are not amortised but are the subject of impairment tests at 31 December each year and when there is an indication of depreciation. Trademarks are tested on the level of all CGUs that operate them.

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Trademarks developed internally are not recognised in the balance sheet.

SoftwareSoftware is amortised on a straight line basis according to the useful lifespan which does not exceed 5 years.

PatentsPatents are amortised on a straight line basis over a period that corresponds to the relevant term of use.

Development costsAll expenses that meet all criteria that defi ne development costs, according to IAS 38 standards, are recognised under intangible fi xed assets and amortised over the project’s lifespan.

All other expenses are considered research costs and recognised under charges.

1.9 Plant, property and equipmentPlant, property and equipment are recognised at acquisition cost. No borrowing costs are accounted for in the value of plant, property and equipment. Amortisation is calculated according to the economic benefi t consumption rates forecast for each asset on the basis of the acquisition cost less the residual value where applicable. The straight line method is used over the following periods:

plant and fi xtures 10 years

computer and offi ce equipment 4 years

offi ce equipment 10 years

These amortisation periods are reviewed annually and amended if expectations diverge from previous estimations.

Real-estate assets are valued retroactively on a per-component basis according to the date of transition. The amortisation of each component is valued according to the useful lifespan as follows:

structure 20 to 50 years

fi xtures and fi ttings 10 to 30 years

1.10 Inventory and services in progressInventory is valued at the lowest of either the entry cost or the probable net value upon realisation.

The valuation of services in progress is calculated at closing according to the cost price as not all requirements are met in order to recognise production in progress (c.f. 1.19).

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1.11 Financial assets as of 1 January 2005Financial assets are comprised of fi nancial fi xed assets, long-term loans and receivables, operating receivables, other receivables and short-term investments.

Financial fixed assets, long-term loans and receivablesAltran owns equity interests in companies on which it does not have a notable infl uence and that it does not control. These equity interests are part of an “incubator” strategy involving investments in companies whose activity involves the development of innovative, high-tech products. Equity interests in non-consolidated entities that Management intends to keep on a long-term basis are considered available for sale and valued at fair value at each closing. Fair value corresponds to the last known stock market value for listed equity interests and to the market value for unlisted equity interests. Changes in fair value, either positive or negative, are recognised under shareholders’ equity in the “Reserves from holders of the parent company’s share capital”. Where there is an objective indication of lasting and signifi cant depreciation of fi nancial fi xed assets, a provision for depreciation is recognised under “Non-recurring charges”.

Non-current fi nancial assets also include pension funds, “construction effort” loans and guarantees and security deposits. They may be the subject of provisions for depreciation if there is an objective indication of depreciation. “Construction effort” loans do not bear interest and are valued at fair value on the basis of the market discount rate of a similar instrument.

Operating and other receivablesTrade and other receivables are recognised at par value. Receivables to mature within 12 months and/or within the operating cycle are considered “Current assets”. A provision for depreciation is recognised when the inventory value, based on the probability of recovery, is less than the recorded value.

Short-term investmentsShort-term investments or cash equivalents are valued at fair value at each closing. These mainly include money market bonds and security deposits. Unrealised or realised gains and losses are recognised in the income statement under “Cash and cash equivalents”.




1.12 Financial liabilities as of 1 January 2005Financial liabilities include a convertible bond loan held with credit institutions, cash credit and other current and non-current liabilities.

Convertible bond loan (“OCEANE”)This “hybrid” fi nancial instrument comprises both a fi nancial debt component and a shareholders’ equity component. In compliance with the IAS 32 standard “Financial instruments”, the portion attributable to shareholders’ equity corresponds to the difference between the par value of the issue and the debt component. The latter is calculated as the fair value of a non-convertible debt and has the same characteristics. The value recognised under shareholders’ equity corresponds to the conversion option and is not re-valued for the term of the loan. The debt component is valued according to the amortised costs method over the estimated lifespan.

The portion of the bond loan of less than one year is recognised under “Current bond loans”.

Bank loansBank loans are initially valued at the fair value of the amount borrowed less any transaction costs directly related to the transactions. They are then valued at amortised costs using the effective interest rate method. All costs related to the issue of loans are recognised in the income statement under “Gross cost of fi nancial debt” over the term of the loan according to the effective interest rate method.

Cash creditCash credit is recorded at par value.

Other current and non-current financial liabilitiesThese items mainly include employee profi t sharing amounts.

1.13 Derivative instruments as of 1 January 2005

Income and charges related to intellectual services provided to customers are usually recognised within the same country thus in the same currency. Therefore, the Group has not implemented any strategies to hedge this type of foreign exchange exposure.

To manage foreign exchange risks, Altran uses interest swaps and futures contracts. These instruments are used with regard to fi nancing and managing the Group’s treasury.

Valuation and presentationDerivatives are valued at fair value when initially recognised. At each closing, they are re-valued according to market conditions.

Recognition of hedging derivativesWhen derivatives are used as hedging instruments, as defi ned in the IAS 39 standard, they are processed according to their purpose:

instruments used to hedge the fair value of existing assets or liabilities;

instruments used to hedge future cash fl ows.

The Group identifi es both the hedging instrument and the element hedged by the instrument. It makes an offi cial record of the hedging transaction, making it possible to follow up on and demonstrate the effectiveness of the transaction over the period in question.

The use of hedge accounting has the following implications:

when hedging the fair value of existing assets or liabilities, the change in fair value of the derivative is recognised in the income statement whilst the element hedged in the balance sheet is re-valued with consideration recognised in the income statement. A potential variance between the two re-valuations demonstrates that the hedge was ineffective;

where future cash fl ows are hedged, the effective portion of the change in the hedging instrument’s fair value is directly recognised under shareholders’ equity in a specifi c reserves account and the change in value of the portion considered “ineffective” is recognised in the income statement. Amounts recognised in the reserve accounts are transferred to the income statement as the cash fl ows hedged are recognised.

Recognition of derivatives that are not considered hedging instrumentsDerivatives that are not considered hedging instruments are initially and subsequently valued at fair value. Changes in fair value are recognised under “Other fi nancial income” or “Other fi nancial charges” in the income statement.

1.14 Shareholders’ equityThe purchase of self-owned shares is recognised as a diminution of shareholders’ equity on the basis of the acquisition cost. When self-owned shares are disposed of, the relevant gains and losses are recorded under the consolidated reserves account for their amount net of income tax.

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1.15 Provisions for risks and chargesIn compliance with the IAS 37 standard “Provisions, contingent liabilities and contingent assets”, provisions for risks and charges are recognised upon closing if the Group has an existing commitment toward a third party that will likely result in an outfl ow of resources for the benefi t of said third party.

The estimated amount recognised as a provision corresponds to the potential outfl ow of resources that Group may incur in order to discharge its obligation. Provisions that are not expected to be used within two years are discounted.

The main provisions for risks and charges recorded by Altran, to the exclusion of retirement obligations, include:

estimated costs related to disputes and claims made by third parties or former employees;

estimated re-structuring costs.

In the event of re-structuring operations, a provision is made before closing once the operations have been announced and a detailed plan is available or once operations commence.

Non-current provisions include provisions that are not directly related to the operating cycle and whose maturity date generally exceeds one year. They mainly include provisions for disputes. The portion of non-current provisions to mature in less than one year is presented in the balance sheet under current provisions.

Contingent liabilities correspond to potential obligations resulting from past events whose existence will only be confi rmed by future events that are often beyond the Group’s control or probable obligations involving a certain outfl ow of resources. They are covered in Paragraph 6.

1.16 Employee benefitsAltran provides employees with various defi ned benefi t pension funds and other benefi ts along with indemnities for the termination of an employment agreement and retirement. The actual characteristics of these plans vary according to the regulations in effect in each country involved.

The main defi ned benefi t pension funds are applicable in Germany, Japan and the Netherlands.

Indemnities for the termination of an employment contract or retirement are usually calculated as a lump sum based on the number of years of service of the employee and his or her annual salary at the time of departure. The main regimes of this type are intended for employees of the Group’s French and Italian employees.

In compliance with the IAS 19 standard, contributions made to defi ned contribution pension plans are recorded as charges for the period and all employee benefi ts are valued annually using the projected credit unit method with consideration given to the specifi c economic conditions of which some are mentioned in paragraph 4.13: death rates,

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staff turnover, evolution of salaries, discount rate and the anticipated profi tability of funds entrusted to pension plans.

These commitments are covered by either a pension plan to which Altran contributes or a provision recognised in the balance sheet as employee entitlements accumulate. The net obligation amount is recognised under “Non-current employee benefi ts”.

Variances recorded between the valuation of a commitment and the anticipated amount (based on forecasted fi gures or new assumptions) and between the forecasted amount of a commitment and the profi t made on funds invested are called actuarial gains and losses.

Altran has chosen to recognise all actuarial variances recorded as of 1 January 2004 according to the corridor method which involves the distribution of any variance in excess of the largest of either 10% of overall commitments or 10% of the fair value of pension fund assets at closing over the number of years of service remaining for the employees in question. When a pension plan is modifi ed or established, the portion of past service costs is immediately recognised in the income statement with the portion of commitments not yet acquired amortised over the remaining term for the accumulation of entitlements. Severance pay for retirement leave was fi rst recognised at 1 January 2004.

1.17 Share-based paymentsIn compliance with the IFRS 2 standard “Share-based payments”, stock purchase and subscription options, plans reserved for employees are valued at the date on which they are awarded.

Share purchase or subscription options (stock-options)Altran has established share-based remuneration plans that have been awarded to certain staff members.

Stock options are valued at fair value at the date on which they are awarded. The fair value corresponds to the value of the benefi t the employee is awarded. This is recognised under “Payroll charges” in the income statement using the straight line method for the period over which entitlements are accumulated with shareholders’ equity in consideration.

The fair value of the option is calculated according to the “Black & Scholes” method whose parameters include the option’s exercise price, lifespan, share price at the date on which it was awarded, the implied volatility of the share, assumptions concerning staff turnover rates and interest rates without risk.

The parameters used at closing are mentioned in paragraph 4.13.

Plans reserved for employeesDuring the fi rst half of 2006, Altran Technologies launched a share issue reserved for employees within the scope Article L. 225-138-1 of the French Commercial Code and Article L. 443-5 of the French Labour Code.




This share issue was offered to all Group employees in France, Germany, Spain, Italy, the United Kingdom, Ireland, Sweden, Belgium, Luxembourg, the Netherlands, Portugal and Austria.

The Group offered its employees the opportunity to become shareholders via a specifi c share issue reserved for employees. In countries that meet the legal and taxation requirements, two investment opportunities were offered: the traditional share ownership plan (subscription of shares with a 20% reduction in the listed share price) and the leveraged plan (award of share subscription warrants for an equivalent amount).

With regard to the traditional share ownership plan, the Group valued the benefi t awarded to employees at the fair value of the shares awarded on that date with consideration given to the fact that shares may not be assigned after acquisition. The subsequent price reduction was appraised by valuing the cost of a hedging strategy combining forward contracts for the sale of non-assignable shares and the cash purchase, fi nanced by a loan, of an equivalent number of assignable shares using a valuation model based on market parameters (said parameters are presented in Note 5.4). The charge recognised equals the reduction in price less the cost of freezing the shares via the acquisition of futures contracts.

Within the scope of the leveraged share ownership plan, the Group values the benefi t awarded to employees by creating a model based on the following scenario:

the employee borrows an amount equalling the reduced price of the share and pays for the latter according to the cost of debt;

sale of his or her options (calls) to a bank.

The charge recognised equals the difference between the sale price of the options and the cost of debt.

The charge is immediately recognised under “Payroll charges” with consideration given to the fact that there is no period during which entitlements are accumulated with “Shareholders equity” in consideration.

The parameters used are presented in Note 5.4.

1.18 Deferred taxesDeferred taxes arise from the temporal differences between the book values of assets and liabilities and their tax values as well as any tax loss carry forwards. They are valued using the accrual method.

Altran compensates deferred tax assets and liabilities on a per-entity basis. tax assets and liabilities are not discounted as per the provisions of the IAS 12 standard.

Deferred tax assets are not recognised unless they are likely to be recovered in the future. To appraise the possibility of recovering such assets, Altran considers the following elements:

forecasted earnings as defi ned in the business plans used when conducting impairment tests;

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tax losses recorded before or after tax inclusions.

Deferred taxes related to intangible assets recognised in relation to groupings of companies are recognised (trademarks...).

1.19 Recognition of turnoverTurnover corresponds to the amount of services provided by all companies included in the Group’s scope of consolidation.

The method used when recognising turnover and related costs depends on the type of service involved. The Group mostly provides time-expended services.

Time and material servicesTurnover and related costs are recognised as project time is logged in proportion to overall time defi ned in the contract.

Fixed-price servicesWhere fi xed-price contracts are concluded resulting in an obligation of due diligence, turnover and earnings are recognised in compliance with the IAS 18 standard using the proportional performance method (IAS II) based on the percentage of work completed as compared to the total of estimated costs for the contract. Where the total of estimated costs of the contract is likely to be in excess of the contract’s income, a provision is immediately made for the end loss.

Any services provided that do not meet the aforementioned conditions are recognised as “Work in progress”.

In application of the IAS 18 standard “Revenue on operating activities”, the re-invoicing of non-margin consultant fees related to commercial services are deducted from external charges.

1.20 Foreign exchange gains/lossesForeign exchange gains/losses, both realised and unrealised, resulting from operating activities are recognised under “Other income on operating activities” or “Other operating income and charges”. Those resulting from fi nancing transactions or transactions intended to hedge investment and fi nancing activities are recognised under “Gross cost of fi nancial debt” and “Other fi nancial income and charges”.

1.21 Earnings per shareThe Group presents its earnings per share and its diluted earnings per shares.

Non-diluted earnings per share (base earnings per share) correspond to net earnings, Group share, adjusted according to the weighted average number of outstanding shares during the period less any self-owned shares.

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2. Scope of consolidation

Scope of consolidation

Diluted earnings are calculated using net earnings attributable to the Group’s shareholders adjusted according to the fi nancial cost of dilutive debt instruments and their impact on employee profi t-sharing, net of corresponding income tax. The number of shares used to calculate diluted earnings accounts for the conversion of dilutive instruments outstanding at closing into shares (subscription options or convertible bonds) where they are likely to have a dilutive effect as is the case for subscription options in particular when their exercise price is less than the market price (average price of the Altran Technologies share over the period).

Where base earnings per share result in a loss, diluted earnings per share follow suit. So as to ensure the comparability of the earnings per share presented, the weighted average number of outstanding shares for the year, along with that of the previous years, is adjusted in the event an increase in capital that is carried out a lesser price than the market price. Self-owned shares are deducted from the consolidated shareholders’ equity and are not included in calculations of earnings per share.

The consolidated fi nancial statements include the fi nancial statements of Altran Technologies and any subsidiaries it owns. All of the Group’s subsidiaries are fully consolidated to the exclusion of those companies

accounted for under the equity method since July 2004 (ADL Yuhan Hosea).

Opening Ouverture

ChangeMethod Consolidation

rateClosing

rateInterest

rate Method Consolidation

rateClosing

rateInterest

rate

Nor

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Germany

ALTRAN DEUTSCHLAND (ex BETEILFCUNGS) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ASKON BERATUNGS NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

EUROSPACE FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BERATA (DEU) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ASKON CONSULTING NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

CHS DATA SYSTEMS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

LITTLE DACEE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ARTHUR D. LITTLE (DEU) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BERATA SERVICE GMBH FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

EUROSPACE IT FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

SUTHERLAND CONSULTING (DEU) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ASKON CONSULTING GROUP GMBH FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

DE SIMONE ET OSSWALD BERLIN FC 100.00 100.00 100.00 NC 0.00 0.00 0.00Elimination of

sub-dimension

AustriaGT CONSULTING FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN AUSTRIA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ARTHUR D. LITTLE AUSTRIA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00Romania ALTRAN ENGINEERING ROMANI A SRL FC 100.00 100.00 100.00 NC 0.00 0.00 0.00 Creation

Belgium

ALTRAN EUROPE FC 100.00 100.00 99.99 FC 100.00 100.00 99.99

DP EUROPE FC 100.00 100.00 94.06 FC 100.00 100.00 94.06

DE VALCK CONSULTANTS FC 100.00 100.00 94.10 FC 100.00 100.00 94.10

ALTRAN BELGIUM FC 100.00 99.00 94.05 FC 100.00 99.00 94.05

NETARCHITECTS EUROPE FC 100.00 100.00 94.90 FC 100.00 100.00 94.85

ADVENTEC FC 100.00 100.00 94.05 FC 100.00 100.00 94.05

DCE CONSULTANTS (BEL) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00ARTHUR D. LITTLE BENELUX (BELGIUM) FC 100.00 100.00 94.05 FC 100.00 100.00 94.05



Opening Ouverture


rateClosing

rateInterest


rateClosing

rateInterest

rate

Zone

Nor

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Luxembourg

ALTRAN LUXEMBOURG FC 100.00 99.90 94.91 FC 100.00 99.90 94.91ALTRAN TECHNOLOGIES LUXEMBOURG FC 100.00 100.00 94.91 FC 100.00 100.00 94.91

DCE CONSULTANTS (LUX) FC 100.00 99.90 94.81 FC 100.00 99.90 94.81

E-CONSULT NC 0.00 0.00 0.00 FC 100.00 99.95 94.86 Merged

Netherlands

ALTRAN INTERNATIONAL FC 100.00 95.00 95.00 FC 100.00 95.00 95.00ALTRAN TECHNOLOGIES NETHERLANDS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

FAGRO FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

GYATA BPI CONSULTANTS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN NETHERLANDS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00ARTHUR D. LITTLE BENELUX NETHERLANDS FC 100.00 100.00 94.05 FC 100.00 100.00 94.05

AKTIVA V.I.P HOLDING NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Liquidated

DCE HOLDING (NLD) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

DCE CONSULTANTS BV (NLD) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

C-QUENTIAL BV NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Liquidated

Sweden

ALTRAN SCANDINAVIA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN TECHNOLOGIES SWEDEN AB FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CONSIGNIT FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

LILLA BOMEN CONSULTANTS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARTHUR D. LITTLE (SWE) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

Switzerland

ALTRAN SWITZERLAND FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BERATA (CHE) FC 100.00 100.00 100.00 FC 100.00 99.50 100.00

INNOVATICA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

INFOLEARN FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

DE SIMONE & OSSWALD HOLDING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CONSULTRAN (CHF) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

SIGMA MANAGEMENT SERVICES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Disposed

WHOM NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ARTHUR D. LITTLE SCHWEIZ FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

United Kingdom

ALTRAN UK FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

HIG H INTEGRITY SYSTEMS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN TECHNOLOGIES UK FC 100.00 100.00 100.00 FC 100.00 100.00 100.00PRAXIS HIG H INTEGRITY SYSTEMS LTD FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN CRITICAL SYSTEMS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

I.B.D. FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ASPECT ASSESSMENT FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BROOMCO (1750) NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Liquidated

GRESHAM BELL FC 100.00 95.00 95.00 FC 100.00 95.00 95.00

CYGNI TE FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

HILSON MORAN PARTNERSHIP FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CCL ACQUISITION FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CAMBRIDGE CONSULTANTS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARTHUR D. LITTLE (GBR) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

DCE CONSULTANTS (GBR) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00




Opening Ouverture


rateClosing

rateInterest


rateClosing

rateInterest

rate

Nor

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United Kingdom

SYNECTICS (UK) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

SUTHERLAND CONSULTING (UK) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CONSIGNIT LIMITED UK FC 100.00 100.00 100.00 NC 0.00 0.00 0.00Elimination of

sub-dimension

ALTRAN IRELAND FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN TECHNOLOGIES IRELAND FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

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Brazil

ALTRAN DO BRASIL FC 100.00 100.00 95.00 FC 100.00 100.00 95.00TECNOLOGIA E CONSULTORIA BRASILEIRA (TCBR) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

TDA DESENHO E ARTES FC 100.00 60.00 57.00 FC 100.00 60.00 57.00ALTRAN CONSULTORIA EM TECNOLOGIA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ARTHUR D. LITTLE (BRESIL) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

LITTLE BRASIL PARTICIPACOES FC 0.00 0.00 0.00 FC 100.00 100.00 95.00

C-QUENTIAL BRASIL FC 0.00 0.00 0.00 FC 100.00 100.00 95.00

Venezuela ARTHUR D. LITTLE DE VENEZUELA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ARTHUR D. LITTLE DE VENEZUELA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

Spain

ALTRAN E.S.P. FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

SOFTWARE DE BASE FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

STE CONSULTING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CONSULTING INFORMATICO NORMA NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ALTRAN CIS SPAIN FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

INTELLFCENT ADVISORS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN DSD FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CSI SPAIN FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CONSULTRANS (ESP) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ADVANCED GLOBAL SOLUTIONS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

TRANSPORTES E INFORMATICA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

SERTEC SOLUTIONES INFORMATICAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

S.P.O.C. NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

D.S.D. NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 MergedS2 SOLUCIONS SERVEIS INFORMATICA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00MEDIA CONSULTORES DE INGENCERIA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BARNAZ HOLDING 02 FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARTHUR D. LITTLE S.L. (ESP) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

I.C.E.A.C.S.A. FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

U.S.M. ENDECAR FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

COBLENZA HISPANA DE SISTEMAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00AGENCIA DE CERTIFICATION INNOVATION FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

I.D.E.A. NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 MergedSTRATEGY AND INNOVATION ADVISORS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

INFO 93 TRAINCNG CENTER NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

INFO 93 NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ItalyALTRAN ITALIA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00CEC CONCURRENT ENGINEERING CONSULTING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00




Opening Ouverture


rateClosing

rateInterest


rateClosing

rateInterest

rate

Sout

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Italy

INGENIE RIA DEI SISTEMI LOGISTICI FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

RSI SISTEMI FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

EKAR NC 0.00 0.00 0.00 FC 100.00 100.00 100.00Partial

contributions

CCS TECHNOLOGIES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

POOL CONSULTING NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ASP - ADVANCED SYSTEM PROJECTS NC 0.00 0.00 0.00 FC 100.00 100.00 100.00Partial

contributions

ORGANI ZZAZIONE E INFORMATICA NC 0.00 0.00 0.00 FC 100.00 100.00 100.00Partial

contributions

CEDATI FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

TQM CONSULT FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ATHENA (ex OTBA ITALIE) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARTHUR D. LITTLE (ITA) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

C-QUENTIAL (ITA) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN SERVIZI FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

RSI TECHNOLOGIES FC 100.00 100.00 100.00 NC 0.00 0.00 0.00 Creation

CSI Italie FC 100.00 100.00 100.00 NC 0.00 0.00 0.00 Creation

Portugal

ALTRAN PORTUGAL SGPS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN CIS Portugal FC 100.00 100.00 95.00 FC 100.00 100.00 95.00ALTIOR CONSULTORIA E ENGENHARIA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00ALTRANTEC CONSULTORIA E ENGENHARIA TECNOLOGICA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

GLOBAL N SOFTWARE E GESTAO NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Merged

Fran

ce

Andorra SERTEC INTERNATIONAL FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTRAN TECHNOLOGIES FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALPLOG NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ALTIOR NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ALTRAN AVENI R NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ALTRAN SYSTEMES D’INFORMATION FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ACTISYS NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ARENDI CONSULTING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARIANE INGENCERIE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ATLANTIDE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

AXIEM FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

C.G.S. EXECUTIVE SEARCH NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

CIRIEL NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

COGIX NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

DP CONSULTING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

GENTECH NC 0.00 0.00 0.00 FC 100.00 99.99 99.99 Merged

GERPI NC 0.00 0.00 0.00 FC 100.00 99.83 99.83 Merged

ALTRAN INVOICING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

GRENAT NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

LORE (FRA) NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

INOQUANT NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 MergedPARTENAIRE SECURITE INFORMATIQUE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged




Opening Ouverture


rateClosing

rateInterest


rateClosing

rateInterest

rate

Fran

ce

SEGIME NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

SIVAN CONSULTING NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

T. MIS CONSULTANTS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ADENA TECHNOLOGIES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ALTAIR TECHNOLOGIES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

DATACEP FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

LOGIQUAL NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

REALIX TECHNOLOGIES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

TRINI NFOR FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ACTISYS (GROUPE DATACEP) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CADIX FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ETHNOS FC 100.00 99.60 99.60 FC 100.00 100.00 100.00

ORTHODROME NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

ACSIENCE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

BERATA (FRA) NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

EDIFIS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

DCE CONSULTANTS FRANCE FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

MAP FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

EXCELLIA FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CORTICAL NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

HEMISPHERES NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

NESS CONSULTING FC 100.00 100.00 100.00 FC 100.00 100.00 100.00INTERACTIFS (ex DIOREM INTERACTIFS) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

IMNET FRANCE FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

S.S.C.E. FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

CERRI CONSULTING FRANCE FC 100.00 99.72 99.72 FC 100.00 99.72 99.72

ALGOPLUS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALGONORM FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

2AD INGENI ERIE NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Disposed

ADL SERVICES FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ARTHUR D. LITTLE (FRA) FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ALTIAM FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

BERATA PARIS NC 0.00 0.00 0.00 FC 100.00 100.00 100.00 Merged

GMTS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00ALTRAN FRANCE EXECUTIVE MANAGEMENT FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ANUBIS TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

APHRODITE TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

APOPIS TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

DIONYSOS TECHNOLOGIES FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

HELENE TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

ISABELLE TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

LOKI TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

OLIVIA TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

SYLVIE TECHNOLOGIES SAS FC 100.00 100.00 100.00 FC 100.00 100.00 100.00




Opening Ouverture


rateClosing

rateInterest


rateClosing

rateInterest

rate

Fran

ce VALERIE TECHNOLOGIES FC 100.00 100.00 100.00 FC 100.00 100.00 100.00

NESS OBJETCT FC 100.00 100.00 100.00 NC 0.00 0.00 0.00 Elimination of

NESS WARE FC 100.00 100.00 100.00 NC 0.00 0.00 0.00 sub-dimension

Rest

of t

he w

orld

Hong Kong

ARTHUR D. LITTLE HOLDING (JAPAN) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00ARTHUR D. LITTLE ASIA PACIFIC (HKG) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN CHINA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00CONTROL SOLUTIONS INTERNATIONAL - ASIA FC 100.00 100.00 95.00 NC 0.00 0.00 0.00 Entrance

India ALTRAN TECHNOLOGIES INDIA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

JapanARTHUR D. LITTLE JAPAN FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN JAPAN KK FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

KoreaARTHUR D. LITTLE YUHAN HOESA ME 25.00 25.00 23.75 ME 25.00 25.00 23.75ALTRAN TECHNOLOGIES KOREA YUHAN FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

Macao ARTHUR D.LITTLE (MACAU) NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 LiquidatedMalaysia ARTHUR D. LITTLE (MALAYSIA) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

Singapore

ALTRAN HOLDINGS (SINGAPORE) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN TECHNOLOGIES SINGAPORE FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

LITTLE ACQUISITION CO KOREA NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Liquidated

ARTHUR D. LITTLE ASIA (SGD) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00LITTLE ACQUISITION CO. HONG KONG NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Liquidated

LITTLE ACQUISITION CO. SINGAPORE NC 0.00 0.00 0.00 FC 100.00 100.00 95.00 Liquidated

DCE CONSULTANTS (SGP) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

Canada

ALTRAN CANADA FC 100.00 100.00 95.00 NC 0.00 0.00 0.00 Elimination of

CSI CANADA FC 100.00 100.00 95.00 NC 0.00 0.00 0.00 sub

SYNECTICS CANADA FC 100.00 100.00 95.00 NC 0.00 0.00 0.00 dimension

ALTRAN USA HOLDINGS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN CORPORATION (USA) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN USA INC FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

THE JOHNSSON GROUP FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN CONSULTING SOLUTIONS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00CONTROL SOLUTIONS INTERNATIONAL FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN CONSULTING SYSTEMS FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ALTRAN SOLUTION INC FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

IMAGITEK FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ARTHUR D. LITTLE NORTH AMERICA FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

ARTHUR D. LITTLE (USA) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

CAMBRIDGE CONSULTANTS. INC FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

SYNECTICS CORP FC 100.00 100.00 95.00 FC 100.00 100.00 95.00

SYNECTICS INC FC 100.00 100.00 95.00 NC 0.00 0.00 0.00Elimination of

sub-dimensionChina ARTHUR D. LITTLE (SHANGAI) FC 100.00 100.00 95.00 FC 100.00 100.00 95.00




3. Events during 2006

3.1 Corporate governance

Management Board At the opening of 2006, the Management Board was comprised of two members, Mr Christophe Aulnette, Chairman of the Board, and Mr Éric Albrand. Mr François-Xavier Floren was also appointed Member of the Board on 8 June 2006.

24 September 2006, the Supervisory Board accepted the resignation of Mr Christophe Aulnette from his mandate of Chairman of the Board and appointed Mr Yves de Chaisemartin as his replace nt.

Finally, on 20 November 2006, the Supervisory Board accepted the resignation of Mr François-Xavier Floren.

In light of these changes, at the end of 2006, the Management Board was comprised of two members, Mr Yves de Chaisemartin and Mr Éric Albrand.

Supervisory Board, following:

the resignation of Mr Yves de Chaisemartin from his mandate of Chairman and Member of the Supervisory Board on 24 September 2006;

the resignation of Mrs. Guylaine Saucier on 15 February 2007;

the co-option of Mr Jacques Etienne de T’Serclaes during the Supervisory Board’s meeting of 5 March 2007 effective 30 March 2007;

the Supervisory Board is now comprised of four members. Their mandates will expire at the Annual General Meeting held in order to approve the accounts of the 2008 year end.

Mr Dominique de Calan was appointed Chairman of the Supervisory Board on 29 September 2006.

The Group’s Management Committee5 December 2006, Mr Yves de Chaisemartin announced the establishment of the Group’s Management Committee comprising two sub-committees:

an Executive Committee entrusted with the mission of steering the Group in compliance with its strategic priorities;

an Operational Committee in charge of developing the Group’s activity on key markets and ensuring the progression of operating margins.

3.2 Launch of an employee share ownership plan: Spring

During the fi rst half of 2006, Altran Technologies launched a plan offering shares to all employees of the Group’s companies located in France, Germany, Spain, Italy, the United Kingdom, Sweden, Belgium, Luxemburg, the Netherlands, Portugal and Austria.

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This transaction has strengthened existing relations between the Group and its employees, offering the latter an opportunity to become more directly involved in the Group’s future developments and performance.

On completion of the transaction, 24 May 2006, 2,872,255 new shares (thus 2.5% of the share capital) had been subscribed for an amount of 26.9 million euros and a total of 2,500 employees. The share of costs related to the establishment of a Group employee savings plan, thus 1.4 million euros, has been recognised as a charge on ordinary activities.

3.3 Cost-cutting and performance enhancement plan

At the General Meeting of Shareholders held 29 June 2005, Altran announced a plan aimed at increasing margin levels via a reduction of indirect costs of 54 to 60 million euros for a full year by means of:

a reduction in indirect payroll costs, especially with regard to holdings;

the streamlining of the Group’s real-estate acquisitions;

a reduction in operating costs through the optimisation of the Group’s purchasing policy concerning certain items such as telecommunications, company cars, etc.

Relevant re-structuring costs amount to 22 million euros for 2006 (2005: 52.7 million euros).

Effi ciency levels were indeed reached but signifi cant investments have been made in order to support the Group’s growth resulting in indirect cost levels that are still too high. The terms of a new cost-cutting plan aimed at reducing indirect costs by three percent of the Group’s turnover by 2009 is to be announced soon.

3.4 Re-structuring of the GroupDuring the past months, the Group has re-structured numerous aspects of its activities within the scope of the Altran 2008 project:

a segmentation by geographical zone making teams more locally available to customers;

the streamlining of the information services offer;

more clarity with regard to the Group’s structure by regrouping its Information Systems and Industrial Technologies activities in each country.

To ensure this new structure, numerous merger-takeover operations, business sales and asset disposals were carried out.

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Events during 2006



Therefore, at the Extraordinary General Meeting of 29 December 2006, a merger, retroactive for taxation and accounting purposes, of Altran Technologies and the following French companies was concluded:

Acsience, Actisys, Adena Technologies, Alplog, Altair Technologies, Altior, Altran Avenir, Ariane Ingénierie, Atlantide, Berata, Berata Paris, CGS Executive Search, Ciriel, Cogix, Cortical, Gerpi, Grenat, Hémisphères, Inoquant, Logiqual, Lore, Orthodrome, Partenaire Sécurite Informatique, Realix Technologies, Segime and Sivan Consulting.

Along with these re-structuring efforts, the Group pursued projects commenced in 2005:

the establishment of a shared information infrastructure within the Group;

the development of a shared ERP (transactional tool) that will gradually be deployed in regions outside France as of January 2007;

the streamlining of property acquisitions. This is how the Paris-based companies of the Technology & Innovation branch and the corporate holding were regrouped in a new building in Levallois during the summer of 2006, following in the footsteps of Madrid, Barcelona, Brussels, Turin, Rome, and Milan...

By promoting the sharing of resources, these projects should be able to reduce the portion of turnover dedicated to indirect costs and are also a means of developing synergies between he Group’s companies.

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The Group has also streamlined and expanded the process of factoring its client receivables. In France, an agreement has been signed with a factoring fi rm that will take over all client receivables which were previously handled by 4 different fi rms. This will also help streamline the collection of receivables which is entrusted to two external fi rms. Agreements for the assignment of client receivables have been signed in Benelux, Germany and Spain.

3.5 Evolution of the scope of consolidationThe main changes to the scope of consolidation in 2006 were as follows:

AcquisitionsNot applicable.

Disposals/LiquidationsThe following companies were disposed of during the year:

2AD Ingénierie (France);

Sigma Management Services (Switzerland).

The impact on consolidated earnings of any disposals or liquidations is (908,000) euros.

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(in thousand euros)

Non-current assets (1,007) Shareholder’s Equity 266

Current assets (1,659) Income from divestment or liquidation (908)

Non-current liabilities (78)

Cash Flow (2,476) Current liabilities (4,422)

(5,142) (5,142)

4. Notes concerning certain balance sheet items

4.1 Net goodwillThe evolution of net goodwill is analysed as follows:

Net value

Balance as of 31 December 2005 500,090

Earn outs 11,067

Loss in value (15,880)

Changes in perimeter (775)

Exchange rate changes (3,476)

Other transactions 919

Balance as of 31 December 2006 491,945

Notes concerning certain balance sheet items



The increase in goodwill mainly corresponds to additional amounts payable on acquisitions made in previous years for a total of 11,517 thousand euros and the readjustment of positive variance appraisals concerning 2005 and paid in 2006, thus (450 ) thousand euros.

The diminution for the year is the result of disposals in the amount of (775 ) thousand euros.

Depreciation recognised in the income statement represents 15,880 thousand euros for 2006, thus 4,622 thousand euros for the fi rst half-year of 2006 and 11,258 thousand euros for the second half-year of 2006.

Depreciation recognised involved 8 cash-generating units (CGU). The net book value before deprecation recorded in 2006 under goodwill stands at 507,825 thousand euros.

When conducting impairment tests on goodwill at 31 December 2006, resulting in the aforementioned depreciations, a WACC of 8.38% was used, thus a pre-tax discounting rate of 10% to 11%.

Results adjusted according to sensitivity level (9.38%) would have resulted in value depreciation in the amount of 28,262 thousand euros.

4.2 Intangible fixed assets

Brands Development costs Software Other Total

As of 31 December 2005

Gross value at opening 34,392 3,641 21,480 1,317 60,830

Amortization and provisions (1,767) (2,028) (16,421) (733) (20,949)

Net value at opening 32,625 1,613 5,059 584 39,881

Transactions during the period:

Acquisitions 22 1,137 4,656 120 5,935

Disposals (7) - (114) (121)

Net amortization and provision expenses (183) (726) (3,204) (117) (4,230)

Changes in perimeter (2) 3 - 1

Exchange rate changes (17) (60) (1) (78)

Other transactions 21 (3) 116 (137) (3)

Total transactions (net value): (149) 394 1,394 (135) 1,504


Gross value at closing 34,398 4,719 22 109 1,097 62,323

Amortization and provisions (1,922) (2,712) (15,656) (648) (20,938)

Net value at closing 32,476 2,007 6,453 449 41,385

The Arthur D. Little trademark stands at 31,968 thousand euros.

For 2006, net allowances for depreciation concerning intangible fi xed assets stand at 4,230 thousand euros and are recognised under net allowances for amortisation and provisions.




4.3 Plant, property and equipment

Land Construction

General facilities, fixtures andf

urnishings

Office and compute

equipment and furniture Other Total


Gross value at opening 533 17,248 30,110 65,757 5,038 118,686

Amortization and provisions (7,007) (20,710) (49,148) (3,367) (80,232)

Net value at opening 533 10,241 9,400 16,609 1,671 38,454

Transactions during the period:

Acquisitions 38 7,514 12,979 754 21,285

Disposals 13 (4,901) (1,930) (233) (7,051)Net amortization and provision expenses (439) (1,032) (7,302) (482) (9,255)

Changes in perimeter (7) (18) 10 (15)

Exchange rate changes (278) (56) (58) (6) (398)

Other transactions 224 516 (316) (456) (32)Total transactions during the period - (442) 2,034 3,355 (413) 4,534


Gross value at closing 533 17,341 25,727 63,252 3,021 109,874

Amortization and provisions (7,542) (14,293) (43,288) (1,763) (66,886)

Net value at closing 533 9,799 11,434 19,964 1,258 42,988

The Group owns its own buildings in France, Italy, the United Kingdom and Venezuela for an amount of 10.3 million euros.

There is no fully-amortised plant, property and equipment still in use representing any signifi cant amount.

For 2006, net allowances for depreciation concerning intangible fi xed assets stand at 9,255 thousand euros, of which 11,305 thousand are recognised under net allowances for depreciation and provisions with a net reversal of 2,050 thousand euros recognised under non-recurrent earnings.

4.4 Non-current financial assetsNon-current fi nancial assets break down as follows:

31/12/2006 31 /12 /2005

Available for sale

Cambridge Consultants incubator 8,760 5,687

Loans and credits generated by the Group

Pension fund assets 8,944 8,992

Construction efforts loans 3 472 2,980

Deposits and guarantees 8,791 7,941

21,207 19,913

Total 29,967 25,600




4.4.1 Assets marked as “available for sale”During 2006, the variance of 3,073 thousand euros is mainly the result of the re-valuation of Vectura shares belonging to CCL with regard to its business incubator activities for an amount of 2,513 thousand euros.

4.4.2 Loans and receivables generated by the Group”Construction effort” loans amount to 3,472 thousand euros at 31 December 2006 as compared to 2,980 thousand euros at 31 December 2005.

A compared to the end of 2005, the variance of 492 thousand euros is mainly due to:

the impact of the fair value of “construction effort” loans, thus (256 ) thousand euros, recognised in the income statement;

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payments for 2006 in the amount of 748 thousand euros.

All other loans and receivables generated by the Group are comprised of guarantees and security deposits.

4.5 Other non-current assetsOther non-current assets are mainly comprised of receivables concerning the disposal of the Fagro Belgium activity in the amount of 625 thousand euros.

4.6 InventoryInventory and production in progress breaks down as follows:

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31/12/2006 31/12/2005 31/12/2004

Raw materials 61 79 71

Service provisioning in progress 1,056 1,880 2,349

Finished goods 84 119 120

Provisions for inventory (64) (80) (109)

Total 1,137 1,998 2,431

The charge recognised in relation to inventory depreciation for 2006 is (39 ) thousand euros as compared to 455 thousand euros in 2005.

No provisions for inventory depreciation were recognised for the year.

Provisions for the depreciation of services in progress stand at 64 thousand euros as compared to 75 thousand euros in 2005.

The reversal of provisions for inventory depreciation recognised in the 2006 income statement stands at 11 thousand euros as compared to 53 thousand euros in 2005.

4.7 Trade receivable and related accountsTrade receivables will mature in less than one year.

The Group remains in charge of recovering trade receivables assigned under factoring agreements. Also, these receivables are still recognised under assets with “Current fi nancial liabilities” in consideration.

Their recognition affects the accounts as follows (in millions of euros):

Assets Liabilities

31/12/2006 31/12/2005 31/12/2006 31/12/2005Accounts receivable (client ) 180,100 159,098

Current financial liabilities 159,015 141,106

Cancellation of deposit (21,085) (17,992)

159,015 141,106 159,015 141,106

4.8 Other receivablesThis item mainly includes tax receivables and other operating receivables.

4.9 Current financial assetsThis item includes guarantees and security deposits that mature in less than one year.



20

4.10 Shareholders equity and earnings per shareAt 31 December 2006, Altran’s share capital was 58,658,118.50 euros divided into 117,316,327 common shares, thus an increase of 2,874,023 shares mainly related to the launch of a Group employee

share ownership plan (cf. 3). During the year ended 31 December 2006, the weighted average number of outstanding shares was 116,367,581 and the weighted average number of common and dilutive shares was 119,194,238.

Breakdown of equity capital Number Par value

Shares comprising equity capital at start of fiscal year 114,442,214 0.50 €

Capital increase associated with the employee shareholding plan 2,872,255 0.50 €

Capital increase associated with the merger 1,768 0.50 €

Shares comprising equity capital at end of fiscal year 117,316,237 0.50 €

31/12/2006 31/12/2005

Net earnings, Altran Technologies share (in thousand euros) 3,787 231

Impact of payments in shares which had a dilution effect 1,138 920

Ordinary shares 116,367,581 114,442,214

Options granted which had a dilution effect 2,826,657 2,610,047

Earnings per share (in euros) 0.03 0.00

Fully diluted earnings per share (in euros) 0.03 0.00

Options awarded with a currently estimated dilutive effect concerning share subscription plans whose exercise price is less than the average price of the share for 2006, thus:

share subscription plans launched in March and June 2003 involving, respectively, a maximum of 3,948,993 and 336,191 share subscription options;

share subscription plans launched in June 2005 involving a maximum of 340,000 share subscription options.

The exercise of these plans would result in the issue of 2,826,657 new shares.

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The following instruments, whose exercise price is less than the average price for 2006 could dilute the share base in the future but are not included in calculations of diluted earnings per share:

the convertible bond loan issued July 2004 involving a maximum of 18,110,236 shares with one company share per bond, thus 15.8% of outstanding common shares (cf. 4.11);

share subscription option plans with a no currently estimated dilutive effect;

share subscription option plans launched June 2004 involving a maximum of 2,762,000 share subscription options;

share subscription option plans launched December 2005 involving a maximum of 2,630,000 share subscription options.

The characteristics of share subscription option plans are presented in 5.4.

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Annexe des comptes consolidés




4.11 Net financial debtNet fi nancial debt corresponds to the difference between total fi nancial liabilities and cash and cash equivalents.

31/12/2006 31 /12 /2005

Cash and cash equivalents 126,226 163,112

Cash liability - -

Net cash 126,226 163,112

Convertible bond loans (> 1 year) 214,487 207,515

Credit establishment borrowings and debts (> 1 year) 59,565 72,293

Non-current financial debts related to assets held in direct financing lease

Other non-current financial liabilities 12,781 17,251

Recon. elim. inter-account balance sheets - LT financial

Current bond loans 8,625 8,625

Current credit establishment borrowings and debts 30,884 4,719

Current financial debts related to assets held in direct financing lease

Bank borrowings 173,894 186,463

Other current financial liabilities 5,853 3,190

Current charge accounts payable

Non-current charge accounts payable

Gross financial debt 506,089 500,056

Net financial debt 379,863 336,944

As compared to 31 December 2005, the Group’s indebtedness has risen 42,919 thousand euros on a like-per-like basis and represents 379,863 thousand euros at 31 December 2006.

Cash equivalentsAt 31 December 2006, the Group’s cash equivalents represent 54,700 thousand , broken down as follows:

31 /12 /2005 Acquisitions Disposals 31/12/2006

Certificates of deposit - - - -

Treasury bills and shares 254 - (254) -

SICAVs (open-ended investment funds) and mutual funds 59,788 469,504 (475,744) 53,548

Bonds and medium-term negotiable bonds - -

Other 1,027 134 - 1,161

Total 61,069 469,638 (475,998) 54,709




Schedule of gross financial debtThe table below presents the distribution of gross fi nancial debt, inclusive of accrued interest and the effect of hedging instruments, per category and per contractual, annual maturity date:

Less than one yearBetween 1 and

2 yearsBetween 2 and



5 years Longer

Convertible bond loans (> 1 year) - 214,487 - - -Credit establishment borrowings and debts (> 1 year) 31,003 28,562 - - -Other non-current financial liabilities 2,809 4,825 3,622 974 538

Current bond loans - 33,812 247,874 3,622 974 538

Current credit establishment 8,625

Long term financial liabilities 30,884

Bank borrowings 173,894

Other current financial liabilities 5,853

Short-term financial liabilities 219,256 - - - - -

219,256 33,812 247,874 3,622 974 538

The schedule of fi nancial debt at 31 December 2006 is as follows:

less than one year 43.3%;

1 to 5 years 56.6%;

more than 5 years 0.1%.

Convertible bond loanThe 3.75% convertible bond loan issued July 2004 represents 230 million euros at 31 December 2006 and is comprised of 18,110,236 bonds with a par value of 12.70 euros each with a term of 4 years and 176 days.

Premature amortisation is possible if so decided by the Group:

for all or part of the bonds, at any time, via a buyback on or off the fi nancial market or via public tenders;

for all outstanding bonds as of 1 July 2007 and until 31 December 2008 provided at least one months notice is given:

at an anticipated reimbursement price of at least par plus any interest accrued since the last date on which interest was paid immediately prior to the anticipated reimbursement date up until the effective reimbursement date ( “Anticipated reimbursement price”),

if the sum of (i) the attribution ratio in effect and (ii) the arithmetical average of closing prices of the company’s share on Euronext Paris S.A.’s fi rst market over a period of 20 consecutive stock market days during which the share was listed as chosen by the company from among the 40 consecutive stock market days during which the share is listed prior to the publication of a notice announcing

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−

−

the premature amortisation, exceeds 130% of the bonds’ par value, thus 16.51 euros;

for all outstanding bonds at any time if less than 10% of bonds issued are outstanding via a reimbursement at the anticipated reimbursement price.

Application of the IAS 32 standard at 1 January 2005 (date of the Group’s initial application of 32/39 standards) with regard to the OCEANE 2009 had a positive impact on shareholders’ equity at 1 January 2005 in the amount of 24.2 million euros. The Group’s fi nancial debt is reduced by a consideration in the same amount.

The market rate applied and the distribution of amounts between the debt component and the shareholders equity component are presented hereafter:

discount rate applied to the debt 6.15%;

effective interest rate 7.55%;

fair value of the debt at the time of issue 202,657 thousand euros.

Accrued interest for 2006, payable at term on 1 January 2007, is 8,625 thousand euros.

The relative fi nancial charge for 2006 is 15,665 thousand euros (see Note 5.7).

The variance between the par value of the 3.75% OCEANE and the IFRS fi nancial charge calculated using the effective interest rate method in application of IAS standards 32/39 at 1 January 2005 results in a charge recognised in the income statement for 2006 in the amount of 7,040 thousand euros.

a

a

a

a




Most fi nancial debts with banks are subject to variable interest rates that are mainly linked to the EURIBOR or EONIA benchmark indexes.

The company could be required to repay all of these lines of credit if certain fi nancial ratios, defi ned on the basis of the fi nancial statements

presented according to French accounting principles as presented in the table below, are not met:

31/12/2005 31/12/2006 31/12/2007 31/12/2008 31/12/2009

Net debt/equity capital 1.15 1.0 1.0 1.0 1.0

Net debt/EBITDA 3.5 3 2.5 2 2

The EBITDA is the equivalent of the gross operating surplus.

Given the application of IFRS/IAS accounting standards since 1 January 2005, the method used to calculate the fi nancial ratios has been modifi ed accordingly as agreed to by the Group’s banks. The maximum fi nancial ratios presented here above remain unchanged.

At 31 December 2006, the Group had not met the previously defi ned ratios. In a letter dated 12 March 2007, it therefore requested that its banks modify the bank ratios applicable at 31 December 2006 as follows:



The Group’s banks confi rmed that they will amend the fi nancial ratios at 31 December 2006 in a letter dated 29 March 2007.

The Group’s fi nancial ratios, to the exclusion of employee profi t sharing and accrued interest and after restatement of the impact of the application of the IAS 32 and IAS 39 standards on the OCEANE 2009 issued 7 July 2004 are:


Net financial debt/EBITDA before profit-sharing 3.08

Within the context of this credit agreement, the Group has made other commitments toward the three banks involved which mainly include the following:

the amount used for new acquisitions is capped at 30 million euros per corporate year;

asset disposals are not to exceed 10 million euros per corporate year, to the exclusion of authorised disposals.

The Company is not bound by any other major covenants with regard to the lines of credit used.

In compliance with a credit agreement concluded in December 2004, the Group established an interest rate hedging contract intended to hedge at least 50% of total revolving credit obligations for a minimum term of 3 years. Altran therefore manages a structural fi xed rate/variable rate position so as to limit the cost of its debt and to this effect, uses interest rate instruments such as swaps, caps and fl oors within the limits defi ned by Management and the credit agreement.

a

a


Main evolution of credit lines Altran has concluded an agreement with its banks for full access to lines of credit in the amount of 90.1 million euros at 31 December 2006 to mature in 2009.

Dec. 2004 June 2005 Dec. 2005 June 2006 Dec. 2006 June 2007 Dec. 2007 June 2008 Dec. 2008 June 2009 Dec. 2009

CADIF fixed rate 20,631 18,592 16 493 14,334 12,112 9,826 7,473 5,053 2,562 - -

CADIF variable rate 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 -

Total CADIF 70,631 63,592 56,493 49,334 42,112 34,826 27,473 20,053 12,562 5,000 -

BNP Paribas variable rate 40,000 36,000 32 000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 -

SG variable rate 40,000 36,000 32 000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 -

Total 150,631 135,592 120,493 105,334 90,112 74,826 59,473 44,053 28,562 13,000



At 31 December 2006, the main characteristics of this hedging contract are as follows (cf. 5.8).

Maturity date Deal Type Initial rate Initial face value Floating rate Currency

SG127 01/04/2008 A Cap 4.11% 15,000,000 Euribor3MP Euro

SG56 01/04/2008 A Cap 3.89% 15,000,000 Euribor3MP Euro

BNP 01/04/2008 A Cap 3.89% 15,000,000 Euribor3MP Euro

CA 01/04/2008 A Cap 3.79% 15,000,000 Euribor3MP Euro

SG128 01/04/2008 V Floor 2.00% 15,000,000 Euribor3MP Euro

SG062 01/04/2008 V Floor 2.00% 15,000,000 Euribor3MP Euro

BNP 01/04/2008 V Floor 2.00% 15,000,000 Euribor3MP Euro

CA 01/04/2008 V Floor 2.00% 15,000,000 Euribor3MP Euro

BNP & CA & SG 01/04/2008 IRS Swap 60,000,000 EIB Euribor3M Euro

The fair value of this derivative represents 60 thousand euros and its variance is recognised in the income statement under other fi nancial charges.

4.12 Provisions for risks and chargesThe evolution of provisions for risks and charges, short-term and long-term, for the year are analysed as follows:

31/12/2005

Allocation for fiscal

yearWrite-down (prov. used)

Write-down (prov. not

used)

Changes in exchange

rateChanges in perimeter

Other changes 31/12/2006

Provision for labour disputes 1,105 2,005 (416) (79) (37) 145 2,723

Provision for other disputes 4,346 879 (713) (12) 690 5,190Provision for subsidiaries liabilities -

Provisions for warranties - -Provision for tax disputes and penalties 59 102 161Provision for losses upon completion 140 (140) -

Provision for other risks > 1 year 3,512 221 (304) (38) (2,236) 1,155

Provision for restructuring 4,241 638 (1,662) (1,856) 1,361

Other provisions for charges 718 632 (527) (9) 115 929Total provisions for long-term risks and charges 14,121 4,375 (3,762) (91) (84) (3,040) 11,519

Provision for labour disputes 7,591 5,806 (3,220) (96) (42) (484) 9,555

Provision for other disputes 1,115 725 (484) (4) (289) 1,063

Provisions for warranties -Provision for tax disputes and penalties 84 18 (8) (2) (59) 33Provision for losses upon completion 273 378 (210) (9) 42 474

Provision for other risks 1,368 1,779 (349) (21) 2,412 5,189

Provision for restructuring 25,336 7,869 (22,003) (66) 1,842 12,978

Provision for other charges 14,138 2,112 (332) (5,075) (25) (317) 10,501Total provisions for short-term risks and charges 49,905 18,687 (26,606) (5,171) (169) 3,147 39,793




Other variances are related to the restatement between “non-current” and “current” following a review of the scheduled outfl ow of resources.

For 2006, net reversals of provisions for risks and charges stand at 12,568 thousand euros, thus (4,638 ) thousand euros allowances for

amortisation and provisions included in the income statement along with a reversal of 17,206,000 euros included under non-recurrent operating earnings of which 2.1 million euros corresponds to the disposal of fi xtures.

Provisions for re-structuring operationsThe evolution of provisions for re-structuring operations is as follows:

2005 Allocations ReversalsExchange rate

differential 2006

Scrapping of furnishings

Payroll charges (18,980) (6,897) 15,209 251 (10,417)

Real estate project (9,020) (1,514) 7,801 (53) (2,786)

Other (1,577) (96) 655 (118) (1,136)

Total (29,577) (8,507) 23,665 80 (14,339)

4.13 Employee benefitsDebt related to current and non-current employee benefi ts breaks down as follows:

2006 2005 Change

Personnel and social security 183,979 140,034 43,945

Other current benefits after employment 33 30,142 (30,109)

184,012 170,176 13,836

Non-current personnel benefits 26,393 23,374 3,019

Other non-current benefits after employment 1,076 1,076

27,469 23,374 4,095

Total 211,481 193,550 17,931

The variance recorded for 2006 is mainly the result of the completion of an appraisal of pension fund obligations of CCL which are to be paid out in 2007 and have therefore been restated under employee debt.

The Group’s total retirement obligations, recognised under “Non-current employee benefi ts”, mainly involve France, Italy, Germany, Japan and the Netherlands and breaks down as follows:


2006 2005

Total

End of retirement obligations

End of contract pay-

outs

Other personnel

charges Total



outs

Other personnel

charges

Change in provision

Net liabilities at opening 23,368 8,057 8,932 6,379 21,748 7,733 8,435 5,580

Expenses for fiscal year 8,213 2,200 3,484 2,529 5,070 519 2,890 1,661

Net sums paid by employer (5,256) (76) (3,507) (1,673) (3,444) (196) (2,393) (855)

Translation differences (120) - - (120) 27 - 27

Change in perimeter 216 (139) 373 (18) (27) - - (27)

Net liabilities at closing 26,421 10,042 9,282 7,097 23,374 8,057 8,932 6,386



Appraisal of commitments and provisions at 31 December 2005 and at 31 December 2006

Variance of the actuarial value of accumulated entitlements

2006 2005

Total



outs

Other personnel

charges Total



outs

Other personnel

chargesActuarial present value of accrued credits at beginning of fiscal year 44,804 10,318 14,066 20,420 35,582 8,748 10,393 16,441

Credits accrued during the year 6,781 1,636 2,802 2,343 5,517 1,369 2,364 1,784

Financial cost 1,773 391 499 883 1,626 401 478 747

Reduction of future credits (322) - - (322) - - - -

Liquidation of commitments/ Curtailment (533) - - (533) (1,792) (1,638) - (154)

Specific advantages - - - - - - - -

Employee contributions 418 - - 418 168 - - 168

Services paid (3,911) (76) (3,507) (328) (3,116) (196) (2,393) (528)

Actuarial gains and losses (3,553) (1,258) (3,222) 927 6,662 1,631 3,224 1,807

Creation/Acquisition 327 (50) 377 - 144 2 - 142Translation differences and other (200) - - (200) 29 - - 29

Actuarial present value of credits accumulated at end of fiscal year 45,584 10,961 11,015 23,608 44,820 10,318 14,066 20,436

Variance of the fair value of hedging assets

2006 2005

Total



outs

Other personnel

charges Total



outs

Other personnel

chargesFair value of coverage assets at beginning of fiscal year 13,244 - - 13,244 11,076 - - 11,076

Yields expected from assets 745 - - 745 1,391 - - 1,391

Reduction of future credits (533) - - (533) - - - -

Liquidation of commitments - - - - - - - -

Employee contributions 418 - - 418 168 - - 168

Employer contributions 5,256 76 3,507 1,673 3,444 196 2,393 855Services paid by coverage assets (3,911) (76) (3,507) (328) (3,116) (196) (2,393) (528)

Creation/Acquisition - - - - 279 - - 279

Not explained - - - - - - - -Translation differences and other (74) - - (74) 2 - - 2

Fair value of coverage assets at end of fiscal year 15,145 - - 15,145 13,243 - - 13,243




Balance sheet commitments

2006 2005

Total



outs

Other personnel

charges Total



outs

Other personnel

chargesShortfall versus accrued credits 30,449 10,961 11,014 8,474 31,577 10,318 14,066 7,193

Actuarial gains and losses not entered (4,231) (920) (1,711) (1,600) (8,202) (2,261) (5,134) (807)Cost of past services not entered 222 - - 222 - - - -

Levelling of assets - - - - - - -

Net provisions entered on balance sheet 26,440 10,041 9,303 7,096 23,374 8,057 8,932 6,386

Hedging assets are mainly recognised in Germany, the Netherlands and Japan. They are mostly comprised of investment funds (FCP), general assets of insurance companies or shares.

The main actuarial assumptions used when appraising long-term retirement obligations are as follows:

As of 31 December 2006 As of 31 December 2005

Inflation rate Yield expected

from assetsRate of salary

increase Inflation rateYield expected

from assetsRate of salary

increase

Euro zone 2.00% 4.30% 2.5% - 3.5% 2.00% 4.00% 2.5%-3.5%

Japan 1.00% 2.00% 1.00% 2.00%

Netherlands 2.00% 4.30% 3.00% 2.00% 4.00% 3.00%

United States 2.00% 5.50% 2.00% 5.50%

The impact on operating earnings and consolidated earnings is as follows:

2006 2005

Total



outs

Other personnel

charges Total



outs

Other personnel

charges

Charges to income statementCosts of services rendered during fiscal year 6,863 1,709 2,778 2,376 5,517 1,369 2,364 1,784

Interest expenses 1,773 391 499 883 1,626 401 478 747Expected return from coverage assets (714) - - (714) (642) - - (642)Actuarial gains and losses entered 306 100 208 (2) (15) 25 49 (89)

Cost of past services 9 - - 9 - - - -Effect of reduction or liquidation of pension plan (91) - - (91) - - - -

Curtailment (86) - - (86) (1,416) (1,277) - (139)

8,060 2,200 3,485 2,375 5,070 519 2,890 1,661




4.14 Other long-term liabilitiesOther long-term liabilities include liabilities that mature in more than 12 months.

4.15 Trade payable and related accountsDebt with suppliers stands at 74,022 thousand euros at 31 December 2006 as compared to 53,258 thousand euros at 31 December 2005.

4.16 Other current debtsThis item mainly includes the portion of products and services invoiced in advance and accounted for under turnover.

4.17 Short-term securities debtDebt on fi xed assets mainly includes short-term securities debt in the amount of 7,777 thousand euros, mostly comprised of positive price variances in the amount of 6,264 thousand euros for 2006, as compared to 39,885 thousand euros for 2005.

5. Notes to the profit and loss account

5.1 Segment information as at 31 December 2006

Pursuant to IAS 14 “Segment Reporting”, the Group is required to communicate segment fi nancial information by geographical segment and business segment and to determine, in accordance with the criteria of IAS 14, which of these two factors (geographical or business) constitutes the primary level of segment information. Following analysis, the primary level of segment information corresponds to geographical segments and the secondary level to business segments.

Altran distinguishes:

4 geographical areas within the primary segment division:

France,

North: Germany, Austria, Benelux, Sweden, Switzerland, UK, Ireland,

South: Brazil, Spain, Italy, Portugal, Andorra, Venezuela,

Rest of the world: Asia, North America, China.

a

−

−

−

−

The services performed by Altran Technologies or the country holding companies for operating subsidiaries are reinvoiced according to business criteria (turnover and payroll), under legal and fi scal provisions adapted to each country;

4 business segments within the segment division:

technology and innovation consulting,

organisation and information systems consulting,

strategy and management consulting,

other.

−

a

−

−

−

−

Notes to the profit and loss account



Segment information by geographical area (in millions of €)

As of 31 December 2006 France North South Rest of WorldInter-sector

cancellations Altran Total

Total revenues

External 641.9 467.3 283.7 102.4 1,495.3

Inter-sector 17.2 18.5 4.2 3.4 (43.3) -

Total income 659.1 485.8 287.9 105.8 (43.3) 1,495.3

Total operating income 661.3 486.2 288.4 105.7 (43.3) 1,498.2

Total operating expenses (658.6) (428.0) (274.3) (104.5) 43.2 (1,422.2)

Current operating profit

Current operating profit by area 2.7 58.2 14.0 1.1 - 76.0

% Current operating profit 0.4% 12.0% 4.9% 1.1% - 5.1%

Expenses not allocated

Operating profit (16.8) 59.2 6.1 (2.8) (0.3) 45.4

% Operating profit (2.5)% 12.2% 2.1% -2.6% 0.7% 3.0%

Cost of gross debt (28.9) (12.6) (7.4) (3.8) 26.8 (25.9)of which interest expenses associated with OCEANE 2009 (15.7) (15.7)

Income from cash equivalents 22.6 6.0 0.6 0.5 (26.7) 3.0

Cost of net debt (6.4) (6.6) (6.8) (3.3) 0 (23.1)

Other financial revenue 2.3 1.8 0.6 - - 4.7

Other financial charges (5.2) (1.9) (0.1) (0.4) - (7.6)

Tax expenses 4.9 (11.7) (7.7) (1.3) - (15.8)

Earnings from affiliates - - - 0.1 - 0.1

Minority interests 0.1 (0.6) 0.2 0.4 0.1

Net earnings - group share (21.1) 40.2 (7.7) (7.3) (0.3) 3.8

Other information

Assets by area 1,219.0 607.6 263.2 80.1 (793.5) 1,376.4

Non-allocated assets - - - - - -

Equity holdings - - - (0.2) - (0.2)

Total assets 2,438 .0 1,215 .2 263.2 79.9 (793.5) 1,376.2Amortization and depreciation expenses by area (7.6) (5.7) (8.5) (0.3) (22.1)Losses in value entered during fiscal year -

in earnings - (5.9) (6.6) (3.4) - (15.9)

directly in shareholder’s equity - - - - - -Reversals of losses in value entered during fiscal year -

in earnings - - - - - -

directly in shareholder’s equity - - - - - -




As of 31 December 2006 France North South Rest of WorldInter-sector

cancellations Altran Total

Total revenues

External 668.4 398.2 275.3 92.6 1,434.5

Inter-sector 15.7 15.6 3.8 3.1 (38.2) 0.0

Total income 684.1 413.8 279.1 95.7 (38.2) 1,434.5

Total operating income 684.3 415.6 280.1 95.7 (37.8) 1,437.9

Total operating expenses (649.9) (380.0) (261.4) (91.2) 37.8 (1,344.7)

Current operating profit

Current operating profit by area 34.4 35.6 18.7 4.5 - 93.2

% Current operating profit 5.0% 8.6% 6.7% 4.7% - 6.5%

Expenses not allocated

Operating profit (2.6) 20.7 10.3 0.4 - 28.8

% Operating profit -0.4% 5.0% 3.7% 0.4% 2.0%

Cost of gross debt (26.6) (9.1) (5.2) (1.9) 18.6 (24.2)of which interest expenses associated with OCEANE 2009 (15.1) (15.1)

Income from cash equivalents 16.6 3.5 0.5 0.2 (18.6) 2.2

Cost of net debt (10.0) (5.6) (4.7) (1.7) - (22.0)

Other financial revenue 14.7 1.7 1.0 0.5 - 17.9

Other financial charges (13.3) (3.5) (0.9) (0.3) - (18.0)

Tax expenses 1.5 (0.7) (4.2) (2.8) - (6.2)Net profit of equity-accounted companies - - - (0.4) - (0.4)

Net earnings - group share (9.7) 12.6 1.5 (4.4) - (0.0)

Other information

Assets by area 1,182.1 551.6 227.9 83.8 (705.2) 1,340.2

Non-allocated assets - - - - - -

Equity holdings - - - (0.5) - (0.5)

Total assets 1 ,182 .1 551 .6 227.9 83.3 (705.2) 1,339.7Amortization and depreciation expenses by area (3.4) (3.6) (0.1) (2.0) - (9.2)Losses in value entered during fiscal year -

in earnings (2.8) (18.1) (0.4) (5.1) - (26.4)

directly in shareholder’s equity - -Reversals of losses in value entered during fiscal year -

in earnings - - - - - -

directly in shareholder’s equity - - - - - -




The division of revenues by geographical area, corresponding to the Group’s internal mode of organisation, is as follows (in thousands of €):

2006 2005

(in thousand euros) Sector totalInter-sector eliminations

Totalnon-group

% of total sales

Totalnon-group

% of total sales Change

France 659,137 (17,208) 641,929 42.9 % 667,077 46.5 % (3.8 %)

North 485,815 (18,516) 467,299 31.3 % 399,613 27.9 % 16.9 %

South 287,940 (4,198) 283,742 19.0 % 275,324 19.2 % 3.1 %

Rest of World 105,768 (3,388) 102,380 6.8 % 92,459 6.4 % 10.7 %

Total 1,538,659 (43,309) 1,495,350 100 % 1,434,473 100.0 % 4.2 %

This table shows the intersegment eliminations for the four segments defi ned. The division of revenues by country is as follows:

(in thousand euros) 2006 % CA H 2 2006 % CA H 1 2006 % CA 2005 % CA H 2 2005 % CA H 1 2005 % CA

France 641,929 42.9% 315 976 42.2% 325,953 43.7% 667,077 46.5% 320,932 45.2% 346,145 47.8%

Germany 139,047 9.3% 72,250 9.6% 66,797 9.0% 118,401 8.3% 60,436 8.5% 57,965 8.0%

Austria 6,355 0.4% 3,281 0.4% 3,074 0.4% 7,019 0.5% 3,705 0.5% 3,314 0.5%Great Britain (Ireland) 117,445 7.9% 62,769 8.4% 54,676 7.3% 94,337 6.6% 50,462 7.1% 43,875 6.1%

Benelux 131,170 8.8% 68,636 9.2% 62,534 8.4% 109,942 7.7% 52,536 7.4% 57,406 7.9%

Switzerland 40,620 2.7% 20,591 2.7% 20,029 2.7% 41,202 2.9% 20,378 2.9% 20,824 2.9%

Sweden 32,661 2.2% 15,753 2.1% 16,908 2.3% 28,712 2.0% 14,054 2.0% 14,658 2.0%

Italy 141,581 9.5% 69,950 9.3% 71,631 9.6% 130,946 9.1% 65,762 9.3% 65,184 9.0%

Spain 105,947 7.1% 51,427 6.9% 54,520 7.3% 104,046 7.3% 51,132 7.2% 52,914 7.3%

Portugal 19,066 1.3% 9,671 1.3% 9,395 1.3% 18,369 1.3% 9,368 1.3% 9,001 1.2%Brazil (Venezuela) 17,148 1.1% 8,753 1.2% 8,395 1.1% 21,962 1.5% 13,117 1.8% 8,845 1.2%

Asia 16,820 1.1% 7,176 1.0% 9,644 1.3% 13,428 0.9% 7,674 1.1% 5,754 0.8%

USA 85,561 5.7% 43,177 5.8% 42,384 5.7% 79,031 5.5% 40,914 5.8% 38,117 5.3%

Total 1,495,350 100.0% 749,408 100.0% 745,942 100.0% 1,434,473 100.0% 710,470 100.0% 724,003 100.0%

Segment information by business segment

As of 31 December 2006 (in thousand euros)Technology

consulting

Organization and information systems

consultingManagement &

strategy consulting Other Group

Total revenues 643,984 444,192 288,653 118,522 1,495,350

Total assets 421,195 185,603 97,311 672,056 1,376,166

Disbursements to acquire fixed and intangible assets (9,225) (3,705) 382 6,880 (5,668)

Total revenues 43.07% 29.70% 19.30% 7.93% 100.00%

Total assets 30.61% 13.49% 7.07% 48.84% 100.00%

Disbursements to acquire fixed and intangible assets 162.74% 65.37% -6.74% -121.37% 100.00%

As of 31 December 2005 (in millions of euros)Technology

consulting

Organization and information systems

consultingManagement &

strategy consulting Other Group

Total revenues 677.8 447.7 186.6 122.4 1,434.5

Total assets 381.9 168.0 115.6 674.0 1,339.6

Disbursements to acquire fixed and intangible assets (0.8) (1.7) (1.1) 2.1 (1.5)

Total revenues 47.25% 31.21% 13.01% 8.53% 100.00%

Total assets 28.51% 12.54% 8.63% 50.32% 100.00%

Disbursements to acquire fixed and intangible assets 51.39% 113.63% 69.65% (134.67)% 100.00%




5.2 RevenuesRevenues break down as follows:

(in millions of euros) 2006 2005 Variation

Sales of goods 5,915 4,071 45.3%

Provisioning of services 1,487,861 1,428,356 4.2%

Royalties 1,574 2,046 (23.1%)

Total 1,495,350 1,434,473 4.24%

In 2006, revenues from fl at-fee contracts were €292.16 million (2005: €183.534 million).

5.3 External chargesAs at 31 December 2006, external charges were as follows:

(in millions of euros) 2006 2005 Change

Sub-contracting 95,988 96,032 (44)

Operating leasing and related expenses 53,724 55,986 (2,262)

Training 9,316 7,129 2,187

Professional fees and external services 49,419 45,523 3,896

Transportation and travel 68,246 63,236 5,010

Other purchases and outside services 43,232 41,610 1,622

Total 319,925 309,516 10,409


External charges increased 3.4% due to fees (+8.5%) and travel engagements (+7.9%). This change is in line with that of revenue.

Total operating lease charges for the 2006 fi nancial year were €53.724 million (2005: €55.986 million). The Group is committed to operating lease contracts (primarily property leases). No operating lease commitment stipulates contingent rental fees as a result of renewal options or provisions establishing specifi c restrictions (notablyconcerning dividends, additional indebtedness and additional leases).

Subleases in respect of non-cancellable leases were €2.803 million, compared with €674,000 in 2005.

An analysis by due date of the commitments made by the Group as at 31 December 2006 on non-cancellable leases is shown in section 7.

5.4 Personnel costsAs at 31 December 2006, personnel costs were as follows:

(in millions of euros) 2006 2005 Change Note

Salaries and compensation (including payroll taxes) 1 019 296 974 537 44 759

Employee shareholding 7 971 7 723 248

1 027 267 982 260 45 007

Expenses related to payment in shares 6 333 4 139 2 194 a

Long-term personnel benefits 8 099 5 070 3 029

Total 1 041 699 991 469 50 230



Personnel costs are in line with the change in staff numbers and include employee profi t sharing in the amount of €7.971 million.

a) Payment in sharesThe total cost of remuneration in shares is €6.333 million for the year ended 31 December 2006 and is divided as follows:

€3.133 million in share subscription options;a

€3.2 million in the SPRING employee shareholding plan put in place during the fi rst half of 2006.

Share subscription optionsThe Board of Directors meeting of 15 June 2005 and the Management Board meeting of 20 December 2005 ruled on the allocation of share subscription options in keeping with the authorisation granted by the Ordinary and Extraordinary General Meeting of 28 June 2004 for a total number of shares of 340,000 and 2,630,000 respectively.

a


As at 31 December 2005, the main characteristics of the plans are as follows:

2003 Plan* 2003 plan* 2004 plan 2005 plan 2005 plan

Shareholder meeting date 17/06/1999 17/06/1999 28/06/2004 28/06/2004 28/06/2004

Date of Board of Dir. or Mgmt Board meeting 11/03/2003 24/06/2003 29/06/2004 15/06/2005 20/12/2005Total number of shares available for purchase on date of attribution 3,948,993 336,191 2,762,000 340,000 2,630,000

of which corporate officers 186,785 - 80,000 200,000 210,000of which number of shares available for purchase by 10 highest paid individuals, including the senior management committee 875,218 106 734 510,000 140,000 635,000

Number of shares purchased on Dec 2006 - - -

Options expired during the period

Start date for exercising options 12/03/2007 25/06/2007 30/06/2008 16/06/2009 21/12/2009

Expiration date 11/03/2011 24/06/2011 29/06/2012 15/06/2013 20/12/2013

Purchase price (in euros) 2.97 6.73 9.37 7.24 9.62* After adjustment of stock option purchase plans as a result of the capital increase in cash with retention of their pre-emptive right to purchase of 23 December 2003, in order to reflect the issuance of 20.8 million new shares.

Charges for the fi nancial year total €3.133 million (€4.139 million for the 2005 fi nancial year)

The options were valued on the date of award based on a Black-Scholes option valuation model with implicit volatility of 35%. The implicit volatility corresponds to the expected volatility of the OCEANE 2009 bond issued in July 2004.

The other parameters used to calculate this charge are:

rate of distribution of earnings: 0.0%;

rate of no-risk investments: 2.9%;

the average exercise duration:

6 years for plans awarded on 11 March and 24 June 2003, 15 June and 21 December 2005;

4 years for the plan of 29 June 2004.

The Spring employee shareholding planAs part of the Group’s employee shareholding policy, Altran offered its staff the chance to hold Altran Technologies shares at a discount of

a

a

a

−

−

20% compared to the average of the last 20 prices of the Altran share before 11 May 2006.

At the close of the scheme on 24 May 2006, 2,872,255 new shares (or 2.5% of the capital) were subscribed in the amount of €26.9 million by 2,500 members of staff.

Traditional shareholding planThe main market parameters used to value this notional lock-in cost and determined on the data of award are as follows:

spot price of the Altran share: €11.55;

no-risk interest rate: 3.9%;

interest rate on a 5-year unassigned treasury bill applicable to market players that are benefi ciaries of locked-in shares: 7.0%.

No charge has been recognised in respect of the traditional shareholding plan.

a

a

a



Shareholding plan with leverage effectThe main market parameters used to value the discount and determined on the date of award are as follows:

spot price of the Altran share: €11.55;

no-risk interest rate: 3.9%;

interest rate on a 5-year unassigned treasury bill applicable to market players that are benefi ciaries of locked-in shares: 7.0%;

repurchase price of the call option by a bank: 30% per option;

origination fee: 4.0%.

a

a

a

a

a

The notional lock-in cost for subscribed shares expressed as a% of the spot price on the date of award is 26.6%.

The charge recognised in respect of the employee shareholding plan with leverage effect is €3.2 million.

(b) Long-term employee benefits (see 4.13)


5.5 Net amortisation and provision expenses


(12 months)2005

(12 months)

Amortization of intangible and fixed assets (15,535) (15,575)

Provisions for current assets (1,957) 4,367

Provision for liability and charges (4,638) 1,992

(22,130) (9,216)

Provisions for restructuring (non-recurring) (17,209) (33,065)

5.6 Other non-recurring operating income and charges


(12 months)2005

(12 months)

Net proceeds from disposal of the Cambridge Consultants Ltd incubator 11,075

Revenue from disposal of Fagro Belgium 1,284

Income from disposal of fixed and intangible assets (316) (748)

Income from divestment & liquidation of holdings in consolidated subsidiaries (908) (2,757)

Reversals of provisions for miscellaneous taxes 5,072 2,931

Miscellaneous compensation received 1,045 1,710

Income from debt cancellation 3,027

Officer severance pay (2,175)

Pension plan 3,065

Guarantee of liabilities for English subsidiary 280

Other (54) 973

Expenses associated with the merger of T&I activities (1,381)

Restructuring charges (39,238) (19,646)

Restructuring provisions 17,208 (33,065)

Total (14,655) (37,963)

Dispute with the former sellers of a Spanish subsidiaryThe Group’s Spanish holding company is in dispute with former directors of one of its subsidiaries over the earn-out amount that was paid to them. They are also accused of diverting business to satellite

companies that they control and the poaching of employees of the Group by these same satellite companies.

A positive ruling in favour of the Group’s Spanish holding company has been appealed against.



Following the transaction conducted in 2006, non-recurring income of €1.045 million has been recognised.

Earnings from the sale and liquidation of consolidated shares(see 3.5)

Reversals of provisions for various taxesAt the time of the acquisition of Arthur D. Little and other companies in 2002, the Group made provisions to contend with potential tax charges prescribed in 2006.

Arthur D. Little pension plansAs part of the acquisition of the Arthur D. Little business in 2002, the Group was required to honour the German and UK pension plans present on this date and to make pension commitment payments for former employees into a pension fund. As this plan has been closed, a defi nitive evaluation of commitments made has been performed. The provision adjustment of €3.065 million has been recognised under non-recurring income

Restructuring costs

(see 3.3)

5.7 Cost of net financial debt

(in millions of euros) 2006 2005

Gains on cash and cash equivalents

Interest income generated by cash and cash equivalents 2,213 1,466

Income from disposal of cash equivalents 703 783

2,916 2,249

Gross cost of debt

Interest expenses associated with bond loans (15,665) (15,171)

Interest expenses on other financing operations (10,345) (9,038)

Income from rate hedging for gross financial debt - -

(26,010) (24,209)

Cost of net financial debt (23,094) (21,960)

The cost of net fi nancial debt of €23.094 million primarily includes interest on bond loans in the amount of €15.665 million and interest on overdrafts and medium-term credit of €10.345 million.

5.8 Other financial income and charges

(in millions of euros) 2006 2005

Financial revenue

Profit from disposal of other capital assets 173 207

Financial gains from conversion to present value 124 225

Profit from derivatives - 214

Gains from translation 3,884 16,380

Income from interest and exchange rate hedging

Reversal of provision on other assets - 430

Other financial revenue 580 487

4,761 17,493

Interest expenses

Depreciation of non-consolidated holdings and other non-current financial assets (41) (1,188)

Losses from translation (6,657) (14,924)

Financial charges from conversion to present value (614) (1,164)

Loss from derivatives (158) (85)

Other financial expenses (296) (673)

(7,766) (18,034)




5.9 Tax expenses

Deferred taxThe net variation in deferred tax on the balance sheet is as follows:

(in thousand euros) 2005 P&L impact Other changesImpact on

equity capitalChanges in perimeter

Translation differences 2006

Deferred tax assets 58,468 10,558 (15,858) (580) 7,744 (836) 59,496

Deferred tax liabilities 8,265 12,447 (17,370) 0 8,178 (220) 11,300

Total 50,203 (1,889) 1,512 (580) (434) (616) 48,196

Income from deferred tax 6,313 (1,884)

Deferred tax recorded in shareholders’ equity during the fi nancial year is as follows:

(in thousand euros)

Fair value reserves, IAS 32/39 standards applied on 1 January 2005 (580)

Total (580)


Tax losses (in thousand euros)

that expire in less than 1 yeara 4,946

that expire in 1 to 5 yearsa 5,322

that expire in more than 5 yearsa 49,369

no expiration date 71,901

Total 131,538

Deferred tax assets and liabilities at the end of the fi nancial year were as follows:

(in thousand euros) 2006 2005

Deferred tax assets by timeframe type

Benefits to staff 14,678 15,586

Other assets and liabilities 20,165 2,193

Other 9,467 3,013

Recoverable tax losses 40,607 42,069

84,917 62,862

Deferred tax liabilities by timeframe type

Assets (32,597) (11,636)

Provision for liability and charges (4,139) (1,021)

(36,736) (12,657)

Net assets 48,181 50,204

Tax loss carryforwards that are likely to be assigned to future earnings total €128.023 million. Their activation represents tax savings of €40.607 million.

Tax losses giving rise to the recognition of deferred tax assets, for which provisions were made on 31 December 2006 due to the uncertain nature of their recovery, total €131.538 million:



Analysis of tax expenses on earningsTax expenses are as follows:


Current taxes:

for the fiscal yeara (13,637) (14,768)

adjustment of current taxes based on previous reporting periodsa 1,154 (556)

Impact of Dutch tax audita 8,058 0

other income taxes payablea (9,580) (6,854)

Impact of non-liability for current taxesa 0 9,539

Carry backa 0 14

Deferred tax:

Deferred taxes associated with changes in base a 869 13,650

Deferred tax associated with changes in rate a (5,350) (3,066)

Impact of taxes associated with prior fiscal years a 6,997 (999)

Impact of Dutch tax audit a (8,215) (3,272)

Change in amortization of deferred tax assets a 3,810

Family tax credit and philanthropic tax credit 89 145

Total (15,805) (6,166)

The differences between the corporate income tax taken into account and the theoretical tax obtained by applying the French rate of taxation are as follows:


Net earnings, group share 3,787 231

Equity in income of affiliates 110 (393)

Minority interests 132 17

Earnings before taxes and goodwill amortization 35,230 33,237

Theoretical tax charges at the rate assigned to parent company (33.33%) a (11,743) (11,245)

Other income taxes payablea (9,580) (6,854)

Change in amortization of deferred tax assetsa 3,810 (3,272)

Difference in rates for foreign countriesa (2,213) (332)

Other permanent differencesa 3,921 15,538

Effective taxes paid (15,805) (6,166)

Effective taxes rate 45% 19%

Other taxes due on earnings correspond primarily to secondary taxes paid in Italy (€4.8 million) and Germany (€2.7 million).

Deferred tax income is as follows:


Temporary differences (6,690) (2789)

Tax deficit 3,810 7,560

Restated consolidation 996 1,542

Total (1,884) 6,313




Follow-up of lawsuits and potential liabilities

6. Major litigation and contingent liabilities

A dispute exists between three companies of the Group and Ilyad Value. The Group is claiming from Ilyad Value the balance of payments due (€3.5 million) relating to studies and training modules sold to Ilyad in 2001. Full provisions have been made for the receivable held by the Group in respect of Ilyad Value. Meanwhile, Ilyad Value is claiming the reimbursement of sums it paid to the Group, plus late interest. Based on the opinion of its advisers, the Group believes that Ilyad Value’s claim is baseless. It would appear that in March 2003, Ilyad Value fi led a complaint and suit for damages in criminal proceedings against Altran Technologies and relating to provision of service contracts concluded between the Altran Technologies and Ilyad Value companies at the end of 2001. Altran Technologies has no available information on these proceedings.

Following the revocation of their respective mandates, two former directors of a subsidiary of the Group (Altiam), acquired during 2002, have taken Altran Technologies to the Commercial Court and are claiming a sum of around €10 million for earn-out sums along with damages and interest. Meanwhile, Altran Technologies has taken action against these two former directors at the Commercial Court for fraud during the sale of shares in the subsidiary and is requesting the return of the purchase price of the subsidiary and the payment of damages and interest. The claims made by Altran Technologies as they stand total €6 million. The Commercial Court did not rule in favour of Altran Technologies and ordered it to pay an earn-out sum in respect of 2003. The Commercial Court has also decided to stay proceedings on the request for payment of the second earn-out. A provision was made for the dispute in the accounts closed on 31 December 2003.

In August 2001, The-E-Consulting Group (ECG) undertook proceedings against Altran Technologies at the Paris Commercial Court regarding the payment of a sum of around €2.3 million for damages and interest. These proceedings follow Altran Technologies’ decision in June 2001 to not acquire an interest in the capital of ECG, a decision that ECG judged to be wrong and likely to enact the liability of Altran Technologies.

These proceedings were resumed by ECG’s liquidator after the liquidation of ECG in September 2001.

Proceedings are still under way and no ruling has yet been made.

In addition, some ECG shareholders undertook proceedings against Altran Technologies at the Paris Commercial Court in August 2001, initially for the payment of a sum of around €3 million for damages and interest, which has risen to €64.4 million in their latest papers. As with the liquidator of ECG, these shareholders criticise Altran Technologies for its decision to not take a participating interest in the capital of ECG.

These separate proceedings are still under way and no ruling has so far been made.

The initial provision has been adjusted in the light of these latest claims.

The Commission des Opérations de Bourse (now A.M.F.) opened an enquiry in the summer of 2002 into the price of the Altran Technologies share.

The Company received notifi cation of grievances and submitted its observations in defence in October 2004.

In these proceedings, the Company risks a maximum administrative fi ne of €1.5 million.

The case is expected to be submitted during the fi rst quarter of 2007 to the A.M.F.’s penalties committee.

Further investigations conducted by the former colleague of the Statutory Auditor into the 2001 accounts and those of the fi rst half of 2002 gave rise to adjustments to the accounts for the fi rst half of 2002.

A preliminary enquiry was then opened by the Paris Public Prosecutor’s Offi ce, an enquiry that became an investigation as of January 2003 into charges of misuse of company property, forgery and distribution of false information so as to infl uence the share price.

Altran Technologies issued a suit for damages in criminal proceedings in February 2003 and was indicted in April 2005 for charges of forgery and the use of forged documents and the distribution of misleading information liable to infl uence share prices; this indictment did not affect the suit for damages. This investigation is currently still under way; however, the report by two experts appointed by the investigating magistrate was been submitted.

The investigating magistrate’s case was fi rst heard in June 2004 in relation to charges of the presentation of accounts not providing an accurate depiction of the Company. It was heard for a second time in September 2004 in relation to the charge of insider trading. As part of this investigation, several former directors and one current director of the Company have been indicted.

As part of the investigation, three natural persons or legal entities have sued for damages.

Furthermore, a complaint and suit for damages in legal proceedings has been fi led by the APPAC.

In addition, in February 2003, Altran Technologies fi led a complaint and suit for damages in legal proceedings due to share price destabilisation and manipulation events of which it believes it has been a victim since the beginning of 2002.

The investigation into this destabilisation complaint was dismissed on 6 December 2005.

Lastly, two complaints with suits for damages in legal proceedings were fi led in October 2004 against certain directors by the former Statutory Auditors, both stating the same charge of hindrance of the role of Statutory Auditor.



A director of a subsidiary of the Group (Imnet) has fi led proceedings against Altran Technologies for breach of its loyalty obligation, wilful concealment and dishonest execution of the contract under which this subsidiary was acquired.

In France, the Group is in dispute with several of its former employees, who are contesting the reasons for their dismissal.

Altran Technologies and the Altran Foundation have had proceedings taken out against them by a former director of the Group for abusive redundancy and persecutory dismissal. These two disputes have given rise to provisions.

Altran Technologies, along with, in certain cases, some of its former directors, has had legal proceedings taken out against it by several of its former employees for false accusation. One of these actions, which concluded with an acquittal of Altran Technologies, has been appealed.

In Spain, the Group is involved in two signifi cant disputes:

the Group’s Spanish holding company is in dispute with former directors of one of its subsidiaries over the earn-out amount that was paid to them. They are also accused of diverting business to satellite companies that they control and the poaching of employees of the Group by these same satellite companies.

A positive ruling in favour of the Group’s Spanish holding company has been appealed against.

Some of these directors have also brought action against this subsidiary for abusive dismissal. No ruling has so far been returned in these proceedings.

a

This case has given rise to provisions in the accounts closed on 31 December 2004.

At the same time, several legal actions have been undertaken by the Spanish authorities against some of these directors for fraud and attempts to intimidate;

the Spanish holding company of the Group has brought legal action against two former directors of another subsidiary in order to obtain the reimbursement of earn-out sums, as well as damages for fraud during the sale of their shares. The sum requested by the Group totals around €4 million.

The Court of First Instance ruled in favour of the majority of this request. The other side appealed against the ruling. The Court of Appeal confi rmed the Court of First Instance’s ruling.

In Switzerland, the Group has fi led a complaint against the former directors of one of its subsidiaries, notably in order to obtain from them the reimbursement of excessive earn-out amounts for previous fi nancial years.

These same facts have been the subject of disclosure to the Public Prosecutor’s Offi ce by the Company’s Statutory Auditors.

The total amount of provisions aimed at covering all of the Group’s disputes totalled €18.9 million as at 31 December 2006.

To the Company’s knowledge, there are no other lawsuits or exceptional events liable to have a signifi cant effect on the fi nancial position, activity or assets of the Company and the Group.

a

Follow-up of lawsuits and potential liabilities



7. Off-balance sheet commitmentsAll commercial and banking commitments as at 31 December 2006 are summarised in the following table:

(in thousand euros)Total

31/12/2006Less than one year

Between 1 and 5 years

More than 5 years

Total 31/12/2005

Commitments disbursed:

deposits, advances and guarantees paid 71,837 40,988 15,044 15,805 70,915

debts secured with collateral

unmatured discounted notes - -

Minimum payments related to operating leasing (see5.3) 89,646 19,101 54,436 16,109 67,638

Non-competition clause concerning former employees:

gross amount a 781 1,055payroll expenses associated with the non-competition pertaining to former employees

a

274 274 370

equity interests (see below)

Variable acquisition price addition determined by the future earnings of the acquired company over a period (generally five years)

Commitments received

deposits, down payments and guarantees received None None

Off-balance sheet commitments

Individual right to trainingThe off-balance sheet commitment recognised for the individual right to training for the entire Group is estimated at 273,000 hours.

This earn-out varies in accordance with the Company’s future earnings and is normally paid over a five-year period.

Reminder of the earn-out principleThe Group’s acquisitions are settled via a set initial payment and an earn-out programme usually lasting 5 years.

If there is no rise in net earnings in a given year compared with the highest historic level, there is no earn-out payment in respect of the year in question, except for companies having agreed to the new earn-out formula.

In 2003, Altran proposed to companies with an earn-out agreement to adapt the calculation formula so that it takes into account the cash generation of these companies. Consequently, it was proposed to the benefi ciaries to eliminate the coeffi cient applied to the increase in earnings in exchange for:

the payment of a set percentage of net earnings;

payment of the earn-out in accordance with changes in the Company’s client receivables. Thus, a company with client receivables representing 90 days of revenue would receive 75% of the earn-out which it would be due in view of its earnings, the balance being paid once the client receivables had actually been settled.

a

a

For those companies to which the old earn-out formula still applies, the method for calculating earn-outs is shown in the fi gure below:

N

Earn-out

Earn-out

Earn-out

No Earn-out

Net

ear

ning

s

N+1 N+2 N+3 N+4 Year

In order to value the earn-out amounts that could be paid in the coming years, Altran undertook a valuation procedure based on the assumptions stated hereinafter.

The Group employed four assumptions of growth in the earnings of companies with earn-out agreements:

5% growth in earnings compared with 2006;



internal forecasts of growth in earnings for the 2007 fi nancial year.

Arthur D. Little, which was acquired in 2002, ended its earn-out programme in 2006.

Eight companies remain in the earn-out programme in 2007, giving rise to the payment of earn-outs in 2008.

a

a

a

a



Following are the assumptions of profi t and earn-out to pay for the forthcoming fi nancial years:

Net earnings growth estimates Total 2007 2008

Internal projections 5.9 0.0

Cumulative net earnings for the period 14.0

15% 3.2 0.0


10% 3.1 0.0


5% 2.9 0.0


The aim of these scenarios is to enable shareholders and investors to construct their assumptions of payments related to acquisitions already made for the coming fi nancial years.

It should be noted that during the 2006 fi nancial year, 17 companies remained eligible for the earn-out system and 10 companies will in 2007

be paid earn-outs relating to earnings from the 2006 fi nancial year. The total amount of earn-outs to be paid in 2007 in respect of 2006 results is €7.7 million.

8. Transactions between related parties

Off-balance sheet commitments

Transactions with the main directorsGross remunerations and benefi ts of any nature paid to the offi cers and directors by the Company and controlled companies totalled €3,357,289 for the 2006 fi nancial year:

short-term benefi ts: €1,700,999;

post-employment benefi ts: none;

other long-term benefi ts: none;

employment termination benefi ts: €1,656,290;

payment in shares: none.

a

a

a

a

a

Commitments of any nature made by the company in respect of officers and directorsThere are no commitments made in respect of Members of the Management Board corresponding to remuneration, fi nancial compensation or benefi ts due or likely to be due as a result of the termination or modifi cation of these duties or subsequent to their completion.

9. Exposure to currency and interest rate risks

9.1 Liquidity riskOn 22 December 2004, the Group signed with its three main banks (BNP Paribas, Crédit Agricole Île-de-France and Société Générale) an agreement for the arrangement of lines of credit totalling €150 million.

This agreement is the result of commitments made by these banks during the capital increase of December 2003.

The fi nancial ratios that the Group must adhere to in order to access these lines of credit are as follows:



Test date Consolidated gearing ratio (1) consolidated financial leverage ratio (2)

31 December 2004 1.40 5.0

31 December 2005 1.15 3.5

31 December 2006 1,00 3.0

31 December 2007 1,00 2.5

31 December 2008 1,00 2.0

31 December 2009 1,00 2.0(1) Gearing= Net financial debt/consolidated equity capital.

(2) Consolidated financial leverage ratio = Net financial debt/EBITDA excluding employee profit-sharing.

Exposure to currency and interest rate risks

These two ratios refer to two contractual notions of net fi nancial debt and “EBITDA excluding profi t sharing”, defi ned as follows:

Net fi nancial debt = Net debt excluding employee profi t sharing and interest incurred on bond loans.

EBITDA excluding profi t sharing = earnings before interest, tax, depreciation and amortisation and employee profi t sharing.

Due to the implementation of IFRS/IAS accounting standards from 1 January 2005, the method for calculating fi nancial ratios has been adjusted in agreement with the Group’s three banks so as to take into account the modifi cation in accounting rules applicable to the borrower.

The maximum fi nancial ratios shown above remain unchanged.

As at 31 December 2006, the Group was not in compliance with the fi nancial ratios previously defi ned. In addition, it asked its banks, in a letter dated 12 March 2007, to adjust the banking covenants applicable as at 31 December 2006 as defi ned hereinafter:



The Group’s banks gave their agreement to the adjustment of these fi nancial ratios as at 31 December 2006 in a letter dated 29 March 2007.

The Group’s fi nancial ratios were as follows on 31 December 2006:



As part of this credit agreement, the Group made other commitments with the three signatory banks, the most signifi cant of which are:

a €30 million limit on sums paid for new acquisitions per fi nancial year;

a €10 million limit on asset disposals per fi nancial year, excluding authorised disposals.

The Company is not required to adhere to any other signifi cant covenants regarding its lines of credit used.

a

a

The Group’s medium-term lines of credit are paid off as shown in the following table:

Dec. 2005 June 2006 Dec. 2006 June 2007 Dec. 2007 June 2008 Dec. 2008 June 2009 Dec. 2009

CADIF fixed rate 16,493 14,334 12,112 9,826 7,473 5,053 2,562 0 0

CADIF variable rate 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0BNP Paribas variable rate 24,000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 0

SG variable rate 24,000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 0

Total 120,493 105,334 90,112 74,826 59,473 44,053 28,562 13,000 0

It should be noted that there is no covenant related to the 2009 convertible bond issued in July 2004.



It should be noted that the Group judges its debt to be at an excessive level and that efforts will be necessary in the long term to reduce it. This debt is primarily comprised of factoring outstandings and the OCEANE 2009 due on 1 January 2009. In view of the forthcoming implementation of a cost reduction plan, it appears that the Group will require additional resources to ensure the successful execution of this plan and the reimbursement of the OCEANE 2009. The Group is also searching for a solution for refi nancing the 2009 debenture under the best conditions. The Group is hoping to secure this refi nancing during 2007.

9.2 Interest rate riskAs at 31 December 2006, the Group’s net debt is €379.9 million, primarily comprising a €230 million convertible bond at a fi xed rate of 3.75% repayable on 1 January 2009. A change in interest rates therefore has a negligible impact and the Group has not put in place an interest rate hedging policy.

Exposure to currency and interest rate risks

Items relating to the due date of fi nancial borrowings and debts are shown in the following table.

(in thousand euros) Less than 1 year 1 to 5 yearsMore than

5 years

Financial liabilities (219.3) (286.8) -

Financial assets 126.2 -

Net position before management (93.1) (286.8) -

Off-balance sheet (exchange rate cover contract) - 60.0 -

Net position after management (93.1) (226.8) -

9.3 Currency RiskThe Group’s currency assets are for the most part comprised of its participating interests in non-eurozone countries (mainly the US, Brazil, the UK, Sweden and Switzerland).

The sum of fi nancial debts taken out in a non-eurozone currency is zero as at 31 December 2006.

In 2006, the Group generated turnover of €310.0 million outside the eurozone. As income and costs arising from intellectual services delivered to customers are denominated in the same currencies, no currency risk hedging policy has been put in place at the Group.

(in thousand euros)

Currency Assets Liabilities Net positionClosing value

on 31/12/2006

Net position in euros before management

Off-balance sheet

Net position in euros after management

Sensitivity to a change of 1%

in currency

USD

GBP 0 (16,600) (16,600) 0.6715 (24,720) (24,720) (247)

CHF

SEK

SGD

9.4 Risk associated with management of the convertible bond debt (OCEANE)

The Group believes that it currently has excessive debt and intends to pursue plans to improve its balance sheet structure. To this end, the following efforts will be undertaken:

a gradual improvement in operating margin;

management of client receivables. The Group believes that this latter item is still too high;

a

a

a continuation of the policy of centralising available cash;

a continuation of the factoring programme: as at 31 December 2006, the Group mobilised €159 million from its accounts receivable.

9.5 Special risks associated with activityThe customers of the Altran Group are primarily major European private and public organisations. As the detailed list of the Group’s customers constitutes strategic information, it is not provided.However, the spread of the Group’s customer portfolio is highly diverse, as its top 50 customers in 2006 accounted for 39.4% of total revenue.

a

a



Companies in the Altran Group bill the vast majority of their services on time spent on a fl at rate basis. In this respect, the only obligation of companies in the Group is to provide resources. In cases where fl at rate contracts are concluded, the accounting policy for the recognition of revenue requires an evaluation of the risk upon completion and only allows the recognition of margin when items exist to verify that margin is not liable to be called into question due to a performance obligation.

9.6 Equity riskThe majority of available cash is invested in:

money market funds;

negotiable debt instruments;

remunerated currency accounts (GBP/USD).

a

a

a

All of these investments are remunerated based on the overnight money market rate or the LIBOR currency rate. The sensitivity of these investments, compared with a variation in the benchmark index (EONIA or LIBOR) of 10%, is 0.20%.

A procedure is currently being prepared for defi ning the rules for using the Group’s cash in each subsidiary and at a central level.

The bulk of the recommendations relate to two main principles:

all cash surplus is invested exclusively in the Group (GMTS).

GMTS primarily allocates this cash to the repayment of debt and/or uses money market supports with sensitivity and volatility of less than 1% a year.

As at 31 December 2006, the Group held marketable securities with a market value of €54.7 million.

a

a

10. Significant events after 31 December 2006

Significant events after 31 December 2006

At the Supervisory Board meeting of 11 January 2007, Yves de Chaisemartin and Éric Albrand resigned from their posts as Members of the Management Board.

The Supervisory Board then decided to set, from 11 January 2007, the number of members comprising the Management Board to two and subsequently appointed Messrs Yves de Chaisemartin and Éric Albrand Chairman of the Management Board and Member of the Management Board respectively for a period of two years.

On 27 February 2007, the Group announced that Mr Jacques-Etienne de T’Serclaes had been co-opted to the positions of Member of the Supervisory

Board of the Group and Chairman of the Audit Committee, a decision confi rmed by the Supervisory Board meeting of 5 March 2007 and which came into effect on 31 March 2007.

Mr de T’Serclaes was co-opted as a replacement following the resignation of Mrs Guylaine Saucier.

Spanish company USM Endecar was sold on 5 February 2007. This company generated annual revenue of around €2 million.


Financial statements and notes to the fi nancial statements 20

FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS

1. Financial statements at 31 December 2006 119

2. Accounting notes to the financial statements at 31 December 2006 121

3. Notes relating to certain balance sheet items 124

4. Notes to the profit and loss account 131

5. Information on major ongoing litigations 134

6. Off-balance sheet commitments 135

7. Subsequent significant events 135

8. Statement of subsidiaries and participating interests 135

9. Statement of earnings for the last five financial years 137


20Financial statements and notes to the fi nancial statements

Financial statements at 31 December 2006

1. Financial statements at 31 December 2006 1.1 Balance sheet at 31 December 2006

Balance sheet – Assets

(in euros) Notes

31/12/2006 31/12/2005

Gross Deprec. & Prov. Net Net

Fixed assets 3.1 279,892,578 22,092,870 257,799,708 258,024,015

Intangible assets

Patents, licenses, brands 7,321,512 4,445,262 2,876,250 2,269,714

Other intangible assets 41,374,441 304,898 41,069,543

Intangible assets in process 64,720 64,720 33,028

Tangible assets 0

Other tangible assets 19,593,334 9,715,390 9,877,944 4,276,316

Fixed assets in process 63,480 63,480 83,010

Capital assets 0

Receivables from ownership interests 152,629,697 6,826,091 145,803,606 195,804,460

Loans and other capital assets 58,845,394 801,229 58,044,165 55,557,487

Current assets 598,723,412 6,864,677 591,858,735 455,660,032

Services in process 207,420 40,175 167,245 56,630

Accounts receivable (clients ) 3.3 44,846,574 6,824,502 38,022,072 28,020,818

Other credits & advances paid 3.3 540,685,869 540,685,869 388,139,987

Cash and securities 12,983,549 12,983,549 39,442,597

Accruals 4,053,416 4,053,416 4,009,694

Pre-paid expenses 3.14 1,630,621 1,630,621 296,440

Deferred charges 3.15 2,422,740 2,422,740 3,632,452

Currency translation adjustment--assets 55 55 80,802

Total assets 882,669,406 28,957,547 853,711,859 717,693,741

Balance sheet - Liabilities

(in euros) 31/12/2006 31/12/2005

Shareholder’s equity 3.4 316,357,483 271,554,654

Capital 58,658,118 57,221,107

Share premiums 202,382,833 156,024,383

Legal reserves 5,865,723 5,563,736

Carry forward 52,745,428 57,920,016

Fiscal year earnings (3,294,619) (5,174,588)

Provisions for risks and charges 3.2 29,966,561 28,093,082

Debts 503,945,246 417,122,584Convertible bond loans 3.7 238,692,920 238,692,913

Credit institution debts and borrowings 3.8 19,984,621 54,029,770

Miscellaneous financial debts and borrowings 3.8 93,406,863 69,702,512

Accounts payable 3.9 23,481,624 19,292,927

Tax and payroll liabilities 3.9 106,082,222 31,010,138

Other liabilities and advances received 3.9 19,393,325 3,180,521

Accruals 2,903,671 1,213,803

Pre-stated income 3,442,568 923,421

Liabilities translation differences 3.13 3,236,062 885,221

Total liabilities 206,506 38,200

853,711,859 717,693,741


20 Financial statements and notes to the fi nancial statements

Financial statements at 31 December 2006

1.2 Profit and loss account at 31 December 2006

(in euros) Notes 31/12/2006 31/12/2005

Total revenues 4.1 490,850,486 160,781,329

Change in inventory (181,766) (56,787)

Own work capitalized 60,403 856,049

Grants and subsidies 12,660 10,241

Reversals of provisions and transfer of charges 7,105,490 2,672,816

Other revenue 3,373,291 64,487

Operating revenue 501,220,564 164,328,135

Other purchases and external costs 106,331,217 68,073,569

Taxes & duties 16,586,759 4,463,744

Salaries and wages 255,590,645 77,865,245

Payroll taxes 110,575,847 32,429,870

Amortization expenses and provisions 13,322,782 5,833,108

Other costs 5,894,748 861,741

Operating expenses 508,301,998 189,527,277

Operating income (7,081,434) (25,199,142)

Recorded profit or transferred loss 4,035

Financial revenue 15,205,524 55,728,164

Interest expenses 18,299,299 22,247,999

Non-operating income 4.2 (3,093,775) 33,480,165

Pre-tax income excluding extraordinary items (10,171,174) 8,281,023

Extraordinary revenue 32,113,614 2,146,088

Extraordinary expenses 36,181,654 28,605,117

Extraordinary income 4.3 (4,068,040) (26,459,029)

Participation 5,508,709

Corporate income tax 4.4 (16,453,304) (13,003,418)

Net Income (3,294,619) (5,174,588)



Accounting notes to the financial statements at 31 December 2006

2. Accounting notes to the financial statements at 31 December 2006

2.1 Key events

Reorganisation of the Group: merger of 26 companiesThe operational reorganisation of the Altran group primarily consists of separating the “Organisation and information systems consulting” and “Technology and innovation consulting” activities by creating the CIS division (Consulting and Information Services) and the TI division (Technology & Innovation).

In hand with its new organisation, the Altran Group has decided to simplify its legal organisation by aligning it with its operational organisation. This internal restructuring has been implemented through the merger-absorption by Altran Technologies of 26 subsidiaries approved by the Extraordinary General Meeting of 29 December 2006.

Consequently, the following subsidiaries have been merged with an accounting and tax effect retroactive to 1 January 2006:

Acsience, Actisys, Adena Technologies, Alplog, Altair Technologies, Altior, Altran Avenir, Ariane Ingenierie, Atlantide, Berata, Berata Paris, CGS Executive Search, Ciriel, Cogix, Cortical, Gerpi, Grenat, Hémisphères, Inoquant, Logiqual, Lore, Orthodrome, Partenaire Sécurité Informatique, Realix Technologies, Segime and Sivan Consulting.

Provision of an employee shareholding plan: SpringIn the fi rst half of 2006, Altran Technologies arranged an offering of shares reserved for employees in accordance with Article L. 225-138-1 of the French Commercial Code and Article L. 443-5 of the French Labour Code.

This share offering was made to all Group employees in France, Germany, Spain, Italy, the UK, Ireland, Sweden, Belgium, Luxembourg, The Netherlands, Portugal and Austria.

This scheme has enabled a strengthening of the existing link between the Group and its staff by offering them the chance to be more closely associated with the Group’s potential developments and future performances.

2,872,255 new shares were allocated to employees under this plan at a total issue value of €26.9 million.

Cost reduction and performance improvement planThe associated restructuring costs generate charges excluding a provision reversal of €11.6 million (€30.6 million in charges covered by provision reversals in the amount of €19.0 million).

These costs relate in particular to:

€13.4 million in wages;

€8 million in fees, rental costs and various expenses;

€3.5 million in fi xtures disposed of following relocations.

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2.2 Accounting rules and methods

2.2.1 Basis for preparing the annual financial statementsThe general accounting conventions were applied in compliance with the principle of prudence and in accordance with the basic assumptions of:

going concern;

consistency of accounting methods from one period to the next;

independence of fi nancial years;

and in compliance with general rules for the establishment and presentation of annual fi nancial statements.

The basic method retained for the assessment of items entered in the accounts is the historical cost method.

2.2.2 Intangible fixed assetsIntangible fi xed assets are valued at their acquisition or production cost.

These fi xed assets correspond to software purchased or created and to brands.

Created software intended for internal or commercial usage is primarily entered under expenses. However, it may be entered under assets when the following conditions are met:

the project is clearly identifi ed and monitored in an individual and reliable manner;

the project has substantial chances of being technically successful;

the project has substantial chances of being commercially profi table for the software intended to be rented, sold or marketed;

the Company displays its intention to produce, market or internally use the software concerned;

the costs activated are direct, internal and external costs undertaken during the phases of organic analysis, programming, testing and for the development of this software.

Amortisation is calculated using the straight-line method in accordance with the anticipated useful life of the software from 12 months to 5 years.

Brands correspond to brand submission costs. They are not amortised.

Business assets comprise:

the historical cost of assets acquired by merged companies;

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the technical merger loss corresponding to the difference between the net value of shares in absorbed companies appearing under the assets of the absorbing company and the book value of these companies.

2.2.3 Tangible fixed assetsTangible fi xed assets correspond to installations and fi xtures, offi ce equipment, IT equipment and furniture.

They are valued at their acquisition cost.

Fixed investments are primarily depreciated on a straight-line basis in accordance with the estimated useful life:

buildings 10-30 years;

fi xtures and installations 3-10 years;

vehicles 5 years;

IT and offi ce equipment 2-5 years;

offi ce furniture 3-10 years;

An extraordinary allocation to depreciations was calculated using the prospective method for fi xtures, installations and offi ce furniture under the Albatros Restructuring plan, with a view to relocating some of the Company’s sites.

The useful life was altered to the expiry date of leases terminated in 2006.

Total extraordinary depreciation is €632,784.

2.2.4 Participating interests, other financial fixed assetsThe gross value of participating interests and other fi nancial fi xed assets appearing on the balance sheet is comprised of their acquisition cost.

The purchase price of participating interests comprises in the majority of cases a set amount settled upon acquisition and an earn-out that varies in accordance with the Company’s future earnings over a period of usually 5 years.

Earn-outs to be paid in year N + 1 in respect of earnings for year N are recorded under assets as a counter-entry to the payables on fi xed assets entry.

Earn-outs in respect of future years constitute off-balance sheet commitments.

The inventory value of securities corresponds to their value in use for the company.

This is determined by taking into account an enterprise value determined using earnings prospects (revenue, EBIT, cash fl ow, rate of growth) based on business plans.

A depreciation is recorded when the inventory value thusly defi ned falls below the acquisition cost.

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2.2.5 Use of estimatesThe preparation of the fi nancial statements requires the use of estimates and assumptions that can have an impact on the book value of certain items on the balance sheet or profi t and loss statement, as well as on the information provided in certain notes to the fi nancial statements. Altran regularly reviews these estimates and assessments in order to take into account past experience and other factors deemed pertinent in respect of economic conditions. These estimates, assumptions and assessments are established on the basis of information and situations in existence on the date of preparation of the fi nancial statements, which may prove in the future to be different from reality. They primarily concern the provisions and assumptions retained for the preparation of the business plans used to value participating interests.

2.2.6 Service work in progressA valuation of service work in progress is performed as at 31 December 2006 at cost of sale when all of the formal conditions gathered to recognise percentage of completion are not fully met .

Depreciation is recorded when the inventory value falls below the nominal value.

2.2.7 ReceivablesReceivables are valued at their nominal value.

The inventory value of advances to subsidiaries is determined using the depreciation method retained for participating interests.

Depreciation is recorded when the inventory value falls below the nominal value.

2.2.8 Deferred chargesThe expenses associated with issuing the 2004 convertible bond loan are amortised over 4 years and 176 days.

The counter-entry for these deferred charges appears under transferred charges.

2.2.9 Provisions for liabilities and chargesProvisions for liabilities and charges are recognised when, at the close of the fi nancial year, the Company has an obligation regarding a third party where it is likely or certain that said obligation will give rise to a payment of resources to this third party, without a counter-entry at least equivalent in value expected from this.

The estimated provision amount corresponds to the resource outfl ow that the Company will probably have to bear to settle its obligation.

The main provisions for liabilities and charges that the Company is required to recognise include:

estimated costs in respect of disputes, litigation and claims on the part of third parties or former employees;

estimated restructuring costs.

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Any liabilities correspond either to potential obligations arising from past events whose existence will only be confi rmed by the occurrence of future events not entirely under the Company’s control, or probable obligations for which the outfl ow of resources is not entirely under the Company’s control.

2.2.10 Commitments relating to retirement gratuitiesUpon retirement, employees of the Company receive a gratuity amount in keeping with law and the provisions of the collective agreement.

Retirement commitments, based on the Syntec agreement and the new terms of the FILLON law, were evaluated by Towers Perrin actuaries.

These retirement provisions correspond to the rights acquired by employees by means of conventional and legal mechanisms. They result from an actuarial calculation.

They are based on the use of life tables, employee tables, length of service, turnover rate by age bracket, a discount rate of 4.00%, an infl ation rate of 2% and a wage revaluation rate of 3%.

2.2.11 Currency transactions and translation adjustmentsCharges and income in foreign currencies are recognised at their euro equivalent on their date of occurrence. Debts, receivables and cash balances in foreign currencies are reported on the balance sheet at their euro equivalent, using the exchange rate in effect at the end of the fi nancial year.

Gains and losses arising from the translation of debts and receivables in foreign currencies at the latter rate appear on the balance sheet under translation adjustments in the case of non-eurozone currencies and latent losses give rise to a contingency provision.

2.2.12 Long-term transactions and recognition of revenuesRevenues correspond to sums received from provisions of service conducted by the Company.

The method used for recognising revenue and costs depends on the nature of the services. The Company performs the majority of its services on a cost basis.

Time and material Revenue and associated costs are recognised in accordance with the stage of completion based on the time spent as compared with the total time appearing in the contract.

Fix price servicesIn circumstances where fi x price contracts are concluded together with a performance obligation, revenue and earnings are recognised in accordance with the percentage of completion method. The percentage of completion is determined in accordance with the percentage of costs incurred for the work performed as compared with the total estimated costs.

When it is likely that the total estimated costs of the contract will be higher than the total income of the contract, a provision is immediately made for the anticipated losses upon completion.

Services performed that do not meet the aforementioned conditions are recorded at the cost of sale under “Work in progress”.

2.2.13 Income tax and tax consolidation2004 saw the implementation of tax consolidation in which Altran Technologies acts as a group leader.

Almost all of the French subsidiaries form an integral part of the tax consolidation scope.

All agreements primarily feature the following points:

General principleThe neutrality principle is used, under which, insofar as is possible, subsidiaries must recognise in their accounts, throughout the duration of consolidation into the Group, an income tax charge or gain and additional contributions similar to those they would have recognised had they not been consolidated.

Income taxFor each fi nancial year, subsidiaries record the tax that they would have had to pay had they never been consolidated.

In practical terms, this is the tax determined after the allocation of previous losses.

The recognition of this tax gives rise to an Altran Technologies receivable of an identical amount in respect of the subsidiaries.

Subsidiaries may not opt for a carryback of their loss during the period in which they belong to the Group.

Tax credits and assetsThese tax credits and assets, whether reimbursable by the Public Treasury or not, are assigned to tax due from subsidiaries by application of the rules.

In 2006, Altran Technologies recorded a research tax credit of €1,259,868.

Receivables from loss carrybacksSubsidiaries’ receivables on loss carrybacks arising before the consolidation period cannot be allocated to tax due by the subsidiaries.

In exchange, subsidiaries may sell to Altran Technologies the receivable(s) in question as per the conditions established in Article 223G of the French General Tax Code.

In 2006, Altran Technologies recorded a carryback of €8,339,383.

The balance of the State-Carryback account at 31 December 2006 is €15,741,322.



Notes relating to certain balance sheet items

Tax payment termsDuring the fi nancial year of entry into the scope of consolidation, subsidiaries pay the four income tax instalments directly to their own tax offi ce and the instalments of contributions due, if applicable.

From the second fi nancial year of consolidation, subsidiaries pay Altran Technologies the income tax instalments, additional contributions and settlements under the standard conditions. The same applies to withholding tax due.

The recording of these amounts at Altran Technologies in the subsidiaries’ current account does not bear interest.

PeriodThe agreement is concluded for the period of consolidation of the subsidiaries, namely 5 years from 1 January 2004.

Terms upon exit from the GroupSubsidiaries exit the Group if one of the conditions required under Article 223A of the French General Tax Code for belonging to the consolidated Group is no longer met.

Exit from the Group takes retroactive effect on the fi rst day of the fi nancial year in which the originating event occurs.

Subsidiaries once again become liable for separate taxes on earnings and long-term net capital gains realised at the close of the fi nancial year in which the event causing the exit occurred.

3. Notes relating to certain balance sheet items

3.1 Fixed assets and depreciations

(in euros)

Gross value at beginning of for

fiscal year Contributions Acquisitions

Disposal or retirement

from service or transfer

Gross value at end of fiscal year

Intangible assets

Business goodwill 2,083,699 2,083,699

Other intangible assets 39,290,742 39,290,742

Patents, licenses, brands 6,209,723 2,982,888 1,394,834 3,265,933 7,321,512

Intangible assets in process 33,028 658 64,720 33,686 64,720

Total 1 6,242,751 44,357,987 1,459,554 3,299,619 48,760,673

Tangible assets

Other tangible assets 17,946,206 11,582,830 8,027,609 17,963,312 19,593,333

Fixed assets in process 83,010 19,724 63,481 102,735 63,480

Total 2 18,029,216 11,602,554 8,091,090 18,066,047 19,656,813

Financial assets

Holdings and related receivables 200,794,243 (97,315,162) 49,742,906 592,290 152,629,697

Loans and other capital assets 56,348,966 10,468,898 25,086,063 33,058,533 58,845,395

Total 3 257,143,209 (86,846,264) 74,828,969 33,650,823 211,475,092

Grand total (1+2+3) 281,415,176 (30,885,723) 84,379,613 55,016,489 279,892,578* As part of its restructuring efforts, Altran Technologies acquired shares and receivables in some of its sub-subsidiaries for a total value of 47,442 thousand euros, then proceeded to merge 26 companies. Moreover, Altran raised capital for one of its subsidiaries for a total value of 2,253 thousand euros.

** The amount of shares and receivables merged is 97,315 thousand euros.




Amortization or provision of Assets

(in euros)

Amount at financial

year start Contributions Increases Decreases

Amount at financial

year end

Intangible assets

Patents, licenses, brands 3,940,009 2,479,721 1,379,308 3,353,776 4,445,262

Business goodwill 304,898 304,898

Total 1 3,940,009 2,784,619 1,379,308 3,353,776 4,750,160

Fixed assets

Other tangible assets 13,669,891 7,948,354 6,637,752 18,540,606 9,715,391

Total 2 13,669,891 7,948,354 6,637,752 18,540,606 9,715,391

Grand total (1+2) 17,609,900 10,732,973 8,017,060 21,894,382 14,465,550

3.2 Provisions and depreciations Provisions and depreciations entered on the balance sheet

(in euros)

Amount at financial

year start Contributions Increases Decreases

Amount at financial

year end

Holdings and related receivables 4,989,782 14,390 1,821,919 6,826,091

Other capital assets 791,479 9,750 801,229

Total capital assets 5,781,261 24,140 1,821,919 7,627,320

Inventory and work in progress 51,260 11,085 40,176

Trade account receivables 3,088,034 4,134,829 1,184,151 1,582,513 6,824,501

Provisions for charges and disputes* 25,951,723 5,031,784 11,422,670 19,560,663 22,845,514

Provisions pour pensions and similar obligations 2,060,557 3,447,243 1,658,082 44,890 7,120,992

Provision for foreign currency losses 80,802 24,737 55 105,539 55

Total provision for liability and charges 28,093,082 8,503,764 13,080,807 19,711,092 29,966,561

Total 37,013,637 12,662,733 16,086,877 21,304,690 44,458,558

Of which recovery of used provision for: (of which risk 16,109,142 €, foreign exchange €105,539 and retirement settlements for €30,573) 16,245,254€

Of which recovery of unused provision for: (of which risk €3,451,521, retirement settlements €14,311) 3,465,838 €

The provision for restructuring under the Albatros plan totalled €9,072,260 as at 31 December 2006.

3.3 Summary of receivables due dates

Gross valueLess than one year Over one year

A sset receivables

Receivables associated with participating interests 13,633,653 13,633,653

Loans 53,715,266 1,191,372 52,523,894

Other capital assets 5,130,129 905,469 4,224,659

Current asset receivables

Client receivables 44,846,573 36,674,817 8,171,755

Personnel and social security 1,437,694 1,437,694

Government 24,469,991 8,728,669 15,741,322

Group and associates 476,709,111 476,709,111

Other receivables 37,886,354 37,886,354

Deferred charges 1,630,621 1,630,621

Total 659,459,392 565,164,109 94,295,283




Information concerning factoring transactions:

customer outstandings: €118,989,798;

current account and factor guarantee: €20,075,674;

short-term factor advance: €98,914,124.

3.4 Changes to shareholders’ equity

TypeValue at beginning

fiscal year

Capital movements Merger operation

Allocation Income from year N

Value at end fiscal yearIncrease Reduction Earnings N-1

Principal 57,221,107 1,437,012 58,658,119

Share premium 156,024,383 24,276,745 180,301,128

Merger bonus 22,081,706 22,081,706

Legal reserve 5,563,735 301,988 5,865,723Retained earnings brought forward 57,920,016 (5,174,588) 52,745,428

Regulated provisions (5,174,588) 5,174,588 (3,294,619) (3,294,619)

Shareholder’s Equity 271,554,653 26,015,745 0 22,081,706 0 (3,294,619) 316,357,485

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The SPRING employee shareholding planThe Group has offered its employees the chance to become shareholders thanks to a special reserved issue. Two investment possibilities were offered in countries that meet the legal and tax requirements: the traditional shareholding plan and the leverage-effect plan.

Under the Group employee shareholding policy, on 11 May 2006 Altran allocated shares to its employees at a discounted price of 20% compared with the average of the last 20 prices of the Altran share prior to this date.

At the close of the scheme on 24 May 2006, 2,872,255 new shares (or 2.5% of the capital) were subscribed in the amount of €26.9 million by 2,500 members of staff (of which €26.1 million was released as at 30 June 2006).

3.5 Composition of equity capital

Breakdown of equity capital Number Par value

Shares comprising equity capital at start of fiscal year 114,442,214 0.50€

Capital increase associated with the employee share-holding plan 2,872,255 0.50€

Capital increase associated with the merger 1,768 0.50€

Shares comprising equity capital at end of fiscal year 117,316,237 0.50€

3.6 Stock optionsThe Board of Directors meeting of 15 June 2005 and the Management Board meeting of 20 December 2005 ruled on the allocation of share

subscription options in keeping with the authorisation granted by the Ordinary and Extraordinary General Meeting of 28 June 2004 for a total number of shares of 340,000 and 2,630,000 respectively.




As at 31 December 2006, the main characteristics of the plans are as follows:

Stock option purchase plan 2001 plan* 2003 plan* 2003 plan* 2004 plan 2005 plan 2005 plan

Shareholder meeting date 17/06/99 17/06/99 17/06/99 28/06/04 28/06/04 28/06/04Date of Board of Dir. or Mgmt Board meeting 10/10/01 11/03/03 24/06/03 29/06/04 15/06/05 20/12/05Total number of shares available for purchase on date of attribution 642, 880 3, 948, 993 336, 191 2, 762, 000 340, 000 2, 630, 000

of which corporate officersa - 186, 785 - 80, 000 200, 000 210, 000of which number of shares available for purchase by 10 highest paid individuals, including the Executive Committee

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85, 708 875, 218 106, 734 510, 000 140, 000 635, 000Number of shares purchased on Dec 2006 - - - - - -

Options expired during the period

start date for exercising options 10/10/05 12/03/07 25/06/07 30/06/08 16/06/09 21/12/09

expiration date 10/10/06 11/03/11 24/06/11 29/06/12 15/06/13 20/12/13

purchase price (in euros) 39.34 2.97 6.73 9.37 7.24 9.62* After adjustment of stock option purchase plans as a result of the capital increase in cash with retention of their pre-emptive right to purchase of 23 December 2003, in order to reflect the issuance of 20.8 million shares.

3.7 Convertible bond loanThe convertible bond loan issued in July 2004 totalled €230,000,000 as at 31 December 2006, comprised of 18,110,236 bonds with a face value of €12.70 and a maturity of 4 years and 176 days.

The remuneration provided is 3.75% a year, payable on January 1 of each year.

Total interest incurred in 2006 and payable in arrears on 1 January 2007 is €8,692,920.

This borrowing could dilute basic earnings per share in the future, due to an exchange parity of one share in the Company for one bond to a maximum of 18,110,236 shares, or 15.80% of ordinary shares outstanding.

This programme has enabled fi nancing sources to be diversifi ed and the average maturity of debt to be lengthened.

3.8 Main changes in lines of creditAltran has an agreement with its bankers ensuring full access to lines of credit totalling €90.1 million as at 31 December 2006 and the availability of which extends to 2009.

Dec. 2004 June 2005 Dec. 2005 June 2006 Dec. 2006 June 2007 Dec. 2007 June 2008 Dec. 2008 June 2009 Dec. 2009

CADIF fixed rate 20,631 18,592 16 493 14,334 12,112 9,826 7,473 5,053 2,562 - -CADIF variable rate 50 000 45,000 40,000 35,000 30,000 25 000 20,000 15,000 10,000 5,000 -

CADIF total 70,631 63,592 56,493 49,334 42,112 34,826 27,473 20,053 12,562 5,000 -BNP Paribas variable rate 40,000 36,000 32 000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 -

SG variable rate 40,000 36,000 32 000 28,000 24,000 20,000 16,000 12,000 8,000 4,000 -

Total 150,631 135,592 120,493 105,334 90,112 74,826 59,473 44,053 28,562 13,000 -

The total of lines of credit used as at 31 December 2006 was €90.1 million.

The majority of fi nancial debts with credit establishments are taken out at a variable rate primarily indexed to the EURIBOR or EONIA benchmark rate.



The entirety of these lines of credit would become repayable if the Company did not meet the maximum fi nancial ratios determined on

the basis of the fi nancial statements presented in accordance with French standards and appearing in the table below:

In agreement with its three banks, the Group has altered the method for calculating fi nancial ratios so as to take into account the modifi cation in accounting rules applicable to the borrower following the application of IFRS/IAS accounting standards from 1 January 2005. The maximum fi nancial ratios shown above remain unchanged.

As at 31 December 2006, the Group was not in compliance with the fi nancial ratios previously defi ned. In addition, it asked its banks, in a letter dated 12 March 2007, to adjust the banking covenants applicable as at 31 December 2006 as defi ned hereinafter:



The Group’s banks gave their agreement to the adjustment of these fi nancial ratios as at 31 December 2006 in a letter dated 29 March 2007.

The Group’s fi nancial ratios, excluding profi t sharing and interest incurred and after restatement of the impacts arising from the application of IAS 32 and IAS 39 on the OCEANE 2009 issued on 7 July 2004, are:



As part of this credit agreement, the Group made other commitments with the three signatory banks, the most signifi cant of which are:

a €30 million limit on sums paid for new acquisitions per fi nancial year;

a €10 million limit on asset disposals per fi nancial year, excluding authorised disposals.

The Company is not required to adhere to any other signifi cant covenants regarding its lines of credit used.

In keeping with the credit agreement signed in December 2004, the Group has put in place an interest rate hedging contract aimed at covering at least 50% of the total revolving credit commitment for a minimum of 3 years. Consequently, Altran manages a fi xed rate/fl oating rate structural position in euros in order to reduce the cost of servicing its debt and to this end uses interest rate derivative instruments (swaps, caps and fl oors) within limits established by the Management and the credit agreement.

As at 31 December 2006, the main characteristics of this hedging contract are as follows.

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Maturity date Deal Type Initial rate Initial face value Variable rate Original

SG127 01/04/2008 A Cap 4.11 % 15,000,000 Euribor3MP euro

SG56 01/04/2008 A Cap 3.89 % 15,000,000 Euribor3MP euro

BNP 01/04/2008 A Cap 3.89 % 15,000,000 Euribor3MP euro

CA 01/04/2008 A Cap 3.79% 15,000,000 Euribor3MP euro

SG128 01/04/2008 V Floor 2.00 % 15,000,000 Euribor3MP euro

SG062 01/04/2008 V Floor 2.00 % 15,000,000 Euribor3MP euro

BNP 01/04/2008 V Floor 2.00 % 15,000,000 Euribor3MP euro

CA 01/04/2008 V Floor 2.00 % 15,000,000 Euribor3MP euro

BNP & CA & SG 01/04/2008 IRS Swap 60,000,000 EIB Euribor3M euro


12/31/2005 31/12/2006 31/12/2007 31/12/2008 31/12/2009

Net debt/equity capital 1.15 1.0 1.0 1.0 1.0

Net debt/EBITDA 3.5 3 2.5 2 2

This assumes that EBITDA corresponds to the French concept of ‘excédent brut d’exploitation’ or gross operating earnings.



3.9 Statement of debt due dates

Summary of debt due dates Gross valueLess than one year

Over one yearLess than 5 years

Convertible debt 238 692 920 8 692 920 230 000 000

Bank borrowings 19,984,621 12,510,762 7,473,859

Other b orrowings and debt 90,610,315 33,203,005 57,407,310

Group and associates 2,796,548 2,796,548

Accounts payable 23,481,624 23,481,624

Fiscal and social liabilities 106,082,222 106,082,222

Debts on assets 19,393,325 19,393,325

Other liabilities 2,850,134 2,850,134

Deferred income 3,236,062 3,236,062

Total 507,127,771 212,246,602 294,881,169

3.10 Related companies and participating interests

(in euros)

Shareholding 138,976,988

Investment-related receivables 13,620,362

Loans 46,600,000

Services in process 15,007

Accounts receivable (client ) 16,276,074

Other pre-paid debts and charges 477,725,997

Credit establishment borrowings and debts 12,284

Other b orrowings and debt 2,970,369

Accounts payable 7,873,773

Debts on assets 18,539,213

Other deferred income and liabilities 331,660

Charges and income concerning related companies

(in euros)

Operating revenue 25,945,715

Operating expenses (21,199,179)

Financial revenue 14,991,448

Interest expenses (323,662)

Extraordinary revenue 12,252,866

Extraordinary expenses (1,344,893)




3.11 Accrued income

(in euros)

Financial assets 56,596

Client and related receivables 13,936,026

Other receivables 528,566

Tax and welfare claims 2,378,886

Cash and equivalents 1,291,886

Total 18,191,960

3.12 Accrued expenses

(in euros)

Convertible debt 8,692,920

Borrowings and debts from banks 70,323

institutions Miscellaneous borrowings and debt 1,462,253

Accounts payable 9,621,335

Fiscal and social liabilities 52,008,882

Other liabilities 530,099

Total 72,385,812

3.13 Prepaid expenses and deferred income

(in euros) Expenses Income

Expenses/Operating income 1,630,621 3,236,062

Total 1,630,621 3,236,062

3.14 Deferred expenses

Amount at start of FY Increases

Allocations of fiscal year to amortization

Amount at end of fiscal year

Deferred expenses* 3,632,452 1,209,712 2,422,740

Total 3,632,452 1,209,712 2,422,740

* Net expenses to be deferred (OCEANE 2009 issuance fees) spread over 4 years and 176 days.




4. Notes to the profit and loss account

4.1 Breakdown of net revenue

Breakdown by business sector (in euros)

Sales of merchandise 360,975

Provision of goods & services 490,489,511

Total 490,850,486

Breakdown by geographic markets (in euros)

Sales in France 456,035,546

Sales abroad 34,814,940

Total 490,850,486

4.2 Financial earnings

Detailed financial income as of 31 December 2006Financial e xpenses

Financial Products

Depreciation of ownership interests 1,821,919

Interests on group credit accounts 323,662

Interest on bank loans 842,639

Interest on bond loans 8,692,920

Interest on employee shareholding 481,491

Interest on bank overdrafts 449,667

Interest on revolving credit 3,214,076

Currency exchange losses 141,211

Financial charges on factoring 1,785,738

Loss on cancelled shares 137,355

Other financial expenses 408,621

Interests on group credit accounts 14,991,082

Interest on loans 6,239

Currency exchange gains 25,374

Other financial revenue 77,290

Recovery of provisions for exchange rate differential 105,539

Total Financial income and charges 18,299,299 15,205,524




4.3 Non-recurring earnings

Detail of extraordinary items as of 31 December 2006Exceptional

e xpenses Products

Extraordinary restructuring expenses 21,353,097

Miscellaneous extraordinary charges 1,901,282

NAV of retired assets 2,243,538

NAV of assets as in the framework of restructuring 3,482,227

Allowance for provisions for risk and liabilities 1,456,573

Allowance for provisions for extraordinary risk and liabilities in the framework of restructuring 5,744,937

Extraordinary restructuring income 61,421

Extraordinary gains from operations 14,813

Income from disposal of retired assets* 12,521,211

Reversals of restructuring provisions 18,955,104

Reversals of miscellaneous extraordinary provisions 831,065

Total extraordinary items 36,181,654 32,113,614

* This consists essentially of the transfer of business goodwill to group subsidiaries in the framework of restructuring.

4.4 Income tax and 2006 impacts of tax consolidation

Subsidiaries’ income tax is recognised in their accounts and refl ected in Altran Technologies’ accounts via current accounts; this income tax is recorded under income at Altran Technologies in the amount of €7,188,921.

Income tax as a whole, determined based on the taxable income of the consolidated Group, is recognised as an expense by Altran Technologies in the amount of €140,132 and corresponds to tax on a long-term capital gain.

In respect of standard total tax losses, Altran Technologies also recognised carryback income and receivables estimated at €8,339,383 and a research tax credit of €1,259,868.

Breakdown of income tax

Breakdown of income tax Income method Tax

Pre-tax income excluding extraordinary items (10,171,174) (5,510,408)

Extraordinary income (4,068,040) (7,758,023)

Employee profit sharing (5,508,709) (1,694,378)

Accounting of corporate income tax on individual companies of AT (14,962,809)

Carry back 8,339,383 (8,339,383)

Individual cons. of subsidiaries; Tax consolidation of group; Tax credits 8,113,922 (8,113,922)

Net income after taxes (3,294,618) (16,453,305)

4.5 Deferred tax liability increases and decreases

Nature of timing differences (in euros) Amount Tax

Relief : Organic 2006 908,827 302,942

Liabilities translation differences 2006 206,506 68,835

Non-deductible provisions 2006 16,013,285 5,337,762

Total 17,128,618 5,709,539


Tax losses arising before tax consolidation total €26.4 million. Losses originating at merged companies and retained following the special tax break approval (“agrément fi scal”) are €2.4 million. 2006 tax losses total €19.9 million.



4.6 Staff

Total staff Salaried personnel

Managerial staff 5,327

Employees 252

Total 5,579

4.7 Director remunerationTax losses arising before tax consolidation total €25.3 million.

Total remunerations paid in 2006 to the Members of the Management Board and the Supervisory Board of Altran Technologies totalled €4,044,863, of which €440,000 in Directors’ fees.

The provision for retirement commitments for these members totalled €20,367 at 31 December 2006.

No loans or advances were granted to these members during the 2006 fi nancial year.

Pro forma income statement

(in euros) 31/12/2006 31 /12 /2005

Total revenues 156,291,544 160,781,329

Change in inventory (67,715) (56,787)

Own work capitalized 60,403 856,049

Grants and subsidies 3,447 10,241

Reversals of provisions and transfer of charges 2,945,606 2,672,816

Other revenue 3,090,484 64,487

Operating revenue 162,323,769 164,328,135

Other purchases and external costs 69,237,741 68,073,569

Taxes & duties 4,867,367 4,463,744

Salaries and wages 79,125,059 77,865,245

Payroll taxes 32,781,380 32,429,870

Amortization expenses and provisions 5,522,672 5,833,108

Other costs 4,049,542 861,741

Operating expenses 195,583,761 189,527,277

Operating profit (33,259,991) (25,199,142)


4.8 Pro forma income statementThe following pro forma 2006 data only takes into account Altran Technologies’ activity as if the merger had not taken place, thus enabling a comparison to be established with the 2005 accounts. This option was retained due to the inability to prepare the 2005 accounts in accordance with the post-merger scope of consolidation.

Altran Technologies’ activity for the 2006 fi nancial year based on the scope of consolidation and activity of 2005 (including the Information Systems activity).



5. Information on major ongoing litigations

Altran Technologies is in dispute with Ilyad Value. Altran Technologies is claiming from Ilyad Value the balance of payments due (€3.5 million) relating to studies and training modules sold to Ilyad in 2001. Full provisions have been made for the receivable held by Altran Technologies in respect of Ilyad Value. Meanwhile, Ilyad Value is claiming the reimbursement of sums it paid to Altran Technologies, plus late interest. Based on the opinion of its advisers, Altran Technologies believes that Ilyad Value’s claim is baseless. It would appear that in March 2003, Ilyad Value fi led a complaint and suit for damages in criminal proceedings against Altran Technologies and relating to provision of service contracts concluded between the Altran Technologies and Ilyad Value companies at the end of 2001. Altran Technologies has no available information on these proceedings.

Following the revocation of their respective mandates, two former directors of a subsidiary of the Group (Altiam), acquired during 2002, have taken Altran Technologies to the Commercial Court and are claiming a sum of around €10 million for earn-out sums along with damages and interest. Meanwhile, Altran Technologies has taken action against these two former directors at the Commercial Court for fraud during the sale of shares in the subsidiary and is requesting the return of the purchase price of the subsidiary and the payment of damages and interest. The claims made by Altran Technologies as they stand total €6 million. The Commercial Court did not rule in favour of Altran Technologies and ordered it to pay an earn-out sum in respect of 2003. The Commercial Court has also decided to stay proceedings on the request for payment of the second earn-out. A provision was made for the dispute in the accounts closed on 31 December 2003.

In August 2001, The-E-Consulting Group (ECG) undertook proceedings against Altran Technologies at the Paris Commercial Court regarding the payment of a sum of around €2.3 million for damages and interest. These proceedings follow Altran Technologies’ decision in June 2001 to not acquire an interest in the capital of ECG, a decision that ECG judged to be wrong and likely to enact the liability of Altran Technologies.

These proceedings were resumed by ECG’s liquidator after the liquidation of ECG in September 2001.

Proceedings are still under way and no ruling has yet been made.

In addition, some ECG shareholders undertook proceedings against Altran Technologies at the Paris Commercial Court in August 2001, initially for the payment of a sum of around €3 million for damages and interest, which has risen to €64.4 million in their latest papers. As with the liquidator of ECG, these shareholders criticise Altran Technologies for its decision to not take a participating interest in the capital of ECG.

These separate proceedings are still under way and no ruling has so far been made.

The initial provision has been adjusted in the light of these latest claims.

The Commission des Opérations de Bourse (now A.M.F.) opened an enquiry in the summer of 2002 into the price of the Altran Technologies share.

The Company received notifi cation of grievances and submitted its observations in defence in October 2004.

In these proceedings, the Company risks a maximum administrative fi ne of €1.5 million.

The case is expected to be submitted during the fi rst quarter of 2007 to the A.M.F.’s penalties committee.

Further investigations conducted by the former colleague of the Statutory Auditor into the 2001 accounts and those of the fi rst half of 2002 gave rise to adjustments to the accounts for the fi rst half of 2002.

A preliminary enquiry was then opened by the Paris Public Prosecutor’s Offi ce, an enquiry that became an investigation as of January 2003 into charges of misuse of company property, forgery and distribution of false information so as to infl uence the share price.

Altran Technologies issued a suit for damages in criminal proceedings in February 2003 and was indicted in April 2005 for charges of forgery and the use of forged documents and the distribution of misleading information liable to infl uence share prices; this indictment did not affect the suit for damages. This investigation is currently still under way; however, the report by two experts appointed by the investigating magistrate has been submitted.

The investigating magistrate’s case was fi rst heard in June 2004 in relation to charges of the presentation of accounts not providing an accurate depiction of the Company. It was heard for a second time in September 2004 in relation to the charge of insider trading. As part of this investigation, several former directors and one current director of the Company have been indicted.

As part of the investigation, three natural persons or legal entities have sued for damages.

Furthermore, a complaint and suit for damages in legal proceedings has been fi led by the APPAC.

In addition, in February 2003, Altran Technologies fi led a complaint and suit for damages in legal proceedings due to share price destabilisation and manipulation events of which it believes it has been a victim since the beginning of 2002.

The investigation into this destabilisation complaint was dismissed on 6 December 2005.

Finally, two complaints and suits for damages in criminal proceedings were fi led in October 2004 against certain directors by the former Statutory Auditors, both stating the same charge of hindrance of the role of Statutory Auditor.

Information on significant legal disputes under way



A director of a subsidiary of the Group (Imnet) has fi led proceedings against Altran Technologies for breach of its loyalty obligation, wilful concealment and dishonest execution of the contract under which this subsidiary was acquired. These proceedings gave rise to provisions as at 31 December 2006.

In France, Altran Technologies is in dispute with several of its former employees, who are contesting the reasons for their dismissal.

Altran Technologies and the Altran Foundation have had proceedings taken out against them by a former director of the Group for abusive

redundancy and persecutory dismissal. These two disputes have given rise to provisions in the accounts to 31 December 2005.

Altran Technologies, along with, in certain cases, some of its former directors, has had legal proceedings taken out against it by several of its former employees for false accusation. One of these actions, which concluded with an acquittal of Altran Technologies, has been appealed.

To the Company’s knowledge, there are no other lawsuits or exceptional events liable to have a signifi cant effect on the fi nancial position, activity or assets of Altran Technologies.

6. Off-balance sheet commitments

(in thousand euros)

Commitments made

Deposits and guarantees to subsidiaries 5,378

Deposits and guarantees to external entities 45,608

Factoring commitments 118,990

Other commitments : vehicle leasing 2,094

Non-competition clauses 1,055

Earn outs 9,200

Individual Right to Training in number of hours 152,638

Commitments received

Revolving credit 78,000

7. Subsequent significant eventsUSM Endecar was sold on 5 February 2007. This company generated annual revenue of around €2 million.

8. Statement of subsidiaries and participating interests

Company Capital

Shareholders equity other than capital

Share in capital held

(%)

Book value of securities held

Receivables, Loans and advances

granted by Company and not yet reim-

bursed

Total of deposits and

advances given by the

CompanyTotal sales

excl. VAT

Earnings (profit or loss of last closed

fin. year)

Dividends received by

the Company during finan-

cial yearGross Net

French subsidiaries in which a more than 50% share is held (in thousand euros)

Altran Systemes d’Information - ASI 3,000 45,113 100 2,874 2,874 0 50,232 4,769 0

Axiem 200 4,971 99.99 5,822 5,822 0 24,219 1,190 0

DP Consulting 264 (926) 100 2,335 2,335 0 2,708 29 0

Altran Invoicing 470 92 100 419 419 106 44

T MIS Consultants 200 1,754 100 5,221 5,221 0 8,557 502 0

Trininfor 40 (106) 100 1,606 1,606 0 1,895 (550)

Ethnos 8 (35) 99.6 8 8 0 99 (71)

Edifis 224 3,772 100 10,391 10,391 0 13,600 1,875 0

Statement of subsidiaries and participating interests



Company Capital

Shareholders equity other than capital

Share in capital held

(%)

Book value of securities held

Receivables, Loans and advances

granted by Company and not yet reim-

bursed

Total of deposits and

advances given by the

CompanyTotal sales

excl. VAT

Earnings (profit or loss of last closed

fin. year)

Dividends received by

the Company during finan-

cial yearGross Net

Ness Consulting 40 1,062 100 7,584 7,584 0 11,229 591 0

Diorem 40 (397) 100 515 515 0 2,798 45

Cerri Consulting (France) 2 097 1,886 99.68 2,920 237 0 0 (51) 0

A.D.L. Services 40 983 100 6,413 6,413 0 0 2 000 0

Altiam 100 (1,247) 100 4,129 0 0 366 (373) 0

A.F.E.M. 1 000 (2) 100 1,000 1,000 0 0 5

Arendi 37 (308) 100 39 39 0 1,491 (281)

DCE Consultants France 37 112 100 34 34 0 1,147 (95)

Anubis Technologies 37 (11) 100.00 37 37 0 0 (10)

Aphrodite Technologies 37 (11) 100.00 37 37 0 0 (10)

Apophis Technologies 37 (12) 100.00 37 37 0 0 (11)

Dionysos Technologies 37 (11) 100.00 37 37 0 0 (10)

Hélène Technologies 37 (11) 100.00 37 37 0 0 (10)

Isabelle Technologies 37 (11) 100.00 37 37 0 0 (10)

Loki Technologies 37 (11) 100.00 37 37 0 0 (10)

Olivia Technologies 37 (11) 100.00 37 37 0 0 (10)

Sylvie Technologies 37 (11) 100.00 37 37 0 0 (10)

Valerie Technologies 37 (11) 100.00 37 37 0 0 (10)

G.M.T.S. 200 (8,308) 80 160 160 343,594 0 (3,865) 0

Foreign subsidiaries (IFRS standards) (in thousand euros)

Altran Estudios Servicos y Proyectos 25 000 (22,167) 99.99 25,142 25,142 0 3,033 7,229 (3,022)

Altran Europe 62 8,977 99.84 31 31 0 31,159 4,630 0

Altran UK 12 500 (18,904) 100 20,928 20,928 7,160 0 (2,285) 0

Altran Deutschland 200 31,302 100 202 202 13,620 3,238 12,159 0

Altran Italia 98 37,451 100 40,305 40,305 403 6,000 3,735 898 0

Altran Scandinavia. 100 31,646 100 12 12 0 5,153 3,311 0

Altran (Switzerland) 500 (9,333) 100 298 298 3,177 53 2,077 (5,929) 0

Altran International 20 21,527 95 18 18 0 6,487 2,364 0

Foreign subsidiaries that were not in the 2005 subsidiaries table

Altran do Brasil 71 244 (28 830) 0.01 1 1 0 2,107 (5,320) 0

Altran Romania 702 0 0 200 200 0 0 0 0

Equity holdings (in thousand euros)

CQS 1 1

Belnedlux 62 29.20 18 18

Statement of subsidiaries and participating interests



9. Statement of earnings for the last five financial years

(in euros)

Closing date 31/12/2002 31/12/2003 12/31/2004 12/31/2005 31/12/2006

Duration of fiscal year 12 months 12 months 12 months 12 months 12 months

capital at financial year end:

Capital 46,817,065 57,220,857 57,221 107 57,221,107 58,658,118

Number of ordinary shares 93,634,131 114,441,715 114,442,214 114,442,214 117,316,237

Operations and earnings in euros:

Total revenues (excluding VAT ) 230,982,696 193,061,183 169,422,415 160,781,329 490,850,486Earnings before taxes, employee profit sharing , allowances for Amortization and provisions 22,956,657 (16,137,831) (6,722,306) (2,675,935) (15,916,378)

Corporate income tax (8,000,860) (8,144,071) (10,285,518) (13,003,418) (16,453,304)

Employee profit sharing 0 0 0 0 5,508,709Earnings after taxes, shareholding, allowances for Amortization and provisions 3,548,254 (31,726,074) 17,640,588 (5,174,588) (3,294,619)

Distributed profit 0 0 0 0 0

Earnings per share in eurosEarnings after taxes, employee profit sharing before allowances for Amortization and provisions 0.33 (0.07) 0.03 0.09 (0.04)Earnings after taxes, employee profit sharing , allowances for Amortization and provisions 0.03 (0.28) 0.15 (0.05) (0.03)

Total amount 0.00 0.00 0.00 0.00 0.00

Staff

Staff 1,931 1,740 1,698 1,545 5,579

Total payroll in euros 86,799,659 83,634,379 80,654,174 77,865,245 255,590,645Sums paid under employee benefit programs (social security, social services, etc.) 36,824,893 35,849,742 33,563,048 32,429,870 110,575,847

20.4 VERIFICATION OF THE ANNUAL FINANCIAL INFORMATION

All reports by the Statutory Auditors are available in appendix 3 of this reference document, from pages 171 to 176.

20.5 LATEST FINANCIAL INFORMATION

Revenue for the fi rst quarter of 2007 is €394.3 million, up 6.1% compared with the fi rst quarter of 2006.

This rate of growth is established after taking into account:

a negative working days effect of 1.0%;

a negative currency effect of 0.5%;

a

a

a negative scope of consolidation effect, resulting from company disposals, of 0.5%.

In France, the Group has generated revenue of €167.0 million, stable compared with the fi rst quarter of 2006. Excluding the impact of working day numbers, revenue was up 1.2% in France during the fi rst quarter of 2007.

a

Latest financial information



31/12/2001 31/12/2002 31/12/2003* 31/12/2004 31/12/2005 31/12/2006Number of Shares 91,716,402 93,634,131 114,441,715 114,441,715 114,442,214 117 314 469

Total dividend per share (excluding tax credit) 0.20 None None None None None

Total amount of dividends paid out (in euros) 18,343,280.40 None None None None None

Internationally, revenue is €227.4 million, up 11.4% against 2006.

(in million euros) Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007Total sales excluding contribution from companies acquired/divested (a) 370.0 372.4 353.7 393.3 394.2

Contribution of acquired companies (b)

contribution of divested companies (c) 1.6 1.9 1.4 1.2 0.1

Total sales (a) + (b) + (c) 371.6 374.3 355.1 394.5 394.3

The Group’s total staff numbers as at 31 March 2007 were 17,037, down by 20 persons compared with 31 December 2006.

Internationally, the Group’s aim is to continue growing at a higher rate than the estimated market growth.

In France, the trend needs to be confi rmed and accelerated.

20.6 INTERMEDIARY AND OTHER FINANCIAL INFORMATION

None.

20.7 DIVIDEND DISTRIBUTION POLICY

Outlook

Significant changes to the financial or commercial position

All information relating to legal disputes and investigations or pending rulings under way is included in this reference document in section 6

“Information on disputes under way” pages 111 and 112 in the notes to the consolidated fi nancial statements.

20.8 LEGAL AND ARBITRATION PROCEEDINGS

20.9 SIGNIFICANT CHANGES TO THE FINANCIAL OR COMMERCIAL POSITION

Since the close of the 2006 fi nancial year, no events have occurred that are liable to signifi cantly alter the Group’s fi nancial or commercial position.

No dividend distribution will be proposed at the General Meeting convened to approve the 2006 fi nancial statements.


21.1 SHARE CAPITAL

Modifi cations to the capital and rights attached to shares

All modifi cations to the capital and the rights attached to the shares composing the capital are governed by applicable regulations. No provision in the company’s articles of association imposes conditions that are more restrictive than those laid down in law.

Share capital

As at 31 December 2006, share capital amounted to €58,658,118.50 divided into 117,316,237 fully paid-up, freely negotiable shares all of the same category.

Capital authorised but not issued

The Supervisory Board meeting of 7 March 2006 authorised the Management Board to make use of the delegation conferred upon it by the Combined Shareholder Meeting of 29 June 2005 in its thirteenth resolution, so as to conduct a share capital increase reserved for employees of the Company and subsidiaries located in France, Germany, Spain, Italy, the UK, Ireland, Sweden, Switzerland, Belgium, Luxembourg, The Netherlands, Portugal and Austria.

In keeping with this authorisation, the Management Board, in its meeting of 10 March 2006, decided on the principle of a capital increase to be conducted via the issue of shares and/or the allocation of share subscription warrants to the maximum total nominal value of €3,000,000, representing 6,000,000 new shares (including shares issued through the exercise of share subscription warrants and pending any necessary adjustments).

The size of the capital increase will match the number of shares actually subscribed, with no minimum being required.

The newly created shares will pay dividends from 1 January 2005.

The Combined General Meeting of 28 June 2004 authorised the Board of Directors to increase for a 26-month period the share capital by a maximum nominal amount of €15 million, with the maintenance or removal of preferential subscription rights, via the issue of all marketable securities giving immediate or future access to the Company’s capital.

In addition, the total amount of capital increases via the capitalisation of reserves, earnings, issue premiums or any other items likely to be incorporated into the capital has been set at €15 million in nominal value.

The total nominal amount of issues of debt securities giving immediate or future access to the capital has been set at €400 million.

The Combined General Meeting of 28 June 2004 ruled that these delegations could be used, under the conditions provided for by Law, in the event of a takeover or exchange offer, until the conduct of the General Meeting convened to approve the Company’s fi nancial statements for the 2004 fi nancial year.

The Board of Directors used these delegations and launched an OCEANE issue of €230 million in July 2004.

It should also be noted that the Company’s Board of Directors launched a convertible bond issue in 2000. The characteristics of these two OCEANES are described in Section 2.2.5, “Convertible bond issues”.

Potential share capital

Share subscription optionsAll of the plans covering stock options awarded by Altran Technologies to its employees have taken the form of share subscription plans.

21 Additional information



It should be noted that Altran Technologies did not allocate a stock option plan to its employees during the 2006 fi nancial year.

2000 plan* 2001 plan*

Plan of 11 March 2003*

Plan of 24 June 2003*

Plan of 29 June 2004

Plan of 15 June 2005

Plan of 20 December 2005

Shareholders’ meeting date 26 June 1996 17 June 1999 17 June 1999 17 June 1999 28 June 2004 28 June 2004 28 June 2004Date of Board of Dir. meeting or Mgmt. Brd meeting 11 April 2000 10 October 2001 11 March 2003 24 June 2003 29 June 2004 15 June 2005

20 December 2005

Number of shares available for purchase 845,792 642,880 3,948,993 336,191 2,770,000 340,000 2,630,000

Of which corporate officers 67,242 186,785 - 80,000 200,000 210,000Of which the top 10 officers** 144,892 85,708 875,218 106 734 510,000 340,000 635,000Starting date to exercise options 1 July 2004 10 October 2005 12 March 2007 25 June 2007 30 June 2008 16 June 2009 21 December 2009

Expiry date 11 April 2005 10 October 2006 11 March 2011 24 June 2011** 29 June 2012 15 June 2013 20 December 2013

Purchase price (in euros) 76.20 39.34 2.97 6.73 9.37 7.24 9.62Number of Shares purchased - - - - - - -* Following a capital increase in cash with retention of the pre-emptive right to purchase of 23 December 2003, the option prices to exercise set forth in the various stock option purchase plans were

adjusted in order to reflect the issuance of 20,807,584 new shares.

** The extraordinary General Meeting of shareholders on 8 June 2006 in its ninth resolution modified the period for exercising the plan of 24 June 2003 to extend the period of eligibility from 5 to 8 years.

Adjustments in share subscription option plans following the capital increase of 23 December 2003:

(in euros)

Plan Exercise price Adjusted exercise price Number of optionsAdjusted number of

options

Adjustement coefficient to apply to

number Plan options

1999 plan 25.56 23.95 2,254,050 2,405,838 1.06734

2000 plan 81.33 76.20 792,429 845,792 1.06734

2001 plan 41.99 39.34 602,319 642,880 1.06734

Plan of 11 March 2003 3.17 2.97 3,699,845 3,948,993 1.06734

Plan of 24 June 2003 7.18 6.73 314,980 336,191 1.06734

Summary

Type of dilutive instruments Date of issue Exercise price Potential dilution % dilution

New stock purchase options 11 March 2003 2.97 3,948,993 3.36%

New stock purchase options 24 June 2003 6.73 336,191 0.29%

New stock purchase options 29 June 2004 9.37 2,762,000 2.35%

New stock purchase options 15 June 2005 9.32 340,000 0.28%

New stock purchase options 20 December 2005 9.67 2,630,000 2.24%

Total new stock purchase options 10,017,184 8.53%

OCEANE 1 January 2009 9 July 2004 12.70 18,110,236 15.43%

Total 25,800,300 23.96%

Share capital


21Additional information

Repurchase by the Company of its own shares

The General Meeting of 8 June 2006 authorised the Management Board to buy back shares limited to 5% of the capital.

In 2006, the Management Board did not use the aforementioned delegation.

Convertible bond issues (OCEANES)

OCEANES 1 January 2009Pursuant to the authorisation conferred upon it by the Combined General Meeting of shareholders on 28 June 2004 and in particular its thirteenth resolution, the Board of Directors ruled, at its meeting of 29 June 2004, on the principle of an issue of bonds with an option to convert and/or exchange for new or existing shares in the amount of €400 million and conferred upon its Chairman, in keeping with the faculty of subdelegation provided for by the Combined General Meeting of 28 June 2004 in its thirteenth resolution, all powers enabling the conduct of this issue and the settlement of the amount, dates, terms and conditions of the issue.

The Chairman of the Board of Directors decided on 1 July 2004 to set the characteristics of the issue as follows:

Type of securities issued:

Bond with the option of conversion into new shares and/or exchange for existing shares (OCEANES)

Nominal value of the issue:

€230,000,000

Number of bonds issued and issue price:

18,110,236 bonds issued at a unit price of €12.70

Date of interest payment, duration and term of the issue:

Interest payment from 9 July 2004 for a period of 4 years and 176 days, the fi rst term of which set for 1 January 2005.

Annual interest:

3.75%

Normal repayment:

Except in the case of early repayment, exchange or conversion, the bonds will be fully reimbursed on 1 January 2009 (or the fi rst working day following this date if it is not a working day) at the money in the amount of €12.70 per bond.

Conversion of bonds and/or exchange for shares:

Bondholders may request the conversion and/or exchange of bonds for shares at any time from the date of settlement, namely 9 July 2004, and until the seventh working day preceding the date of normal or early reimbursement in the amount of one Company share for one bond, subject to adjustments anticipated in the event of fi nancial operations conducted by the Company.

The Company may award new and/or existing shares as it sees fi t.

Early repayment:

Early repayment is possible, but only as the Company sees fi t:

in respect of all or part of the bonds, at any time, through market or over-the-counter repurchasing or public offerings;

in respect of all bonds outstanding, from 1 July 2007 until 31 December 2008, subject to minimum notice of one month:

at an early reimbursement price equal to the at-the-money value, plus interest incurred since the last date of interest payment preceding the date of early reimbursement until the actual reimbursement date (the “Early Reimbursement Price”),

if the sum (i) of the share award ratio in effect and (ii) of the arithmetic average of the closing prices of the Company’s share on the First Market of Euronext Paris S.A. during a period of 20 consecutive trading days during which the share is listed and chosen by the Company from the 40 consecutive trading days during which the share is listed, preceding the date on which notice of early repayment is given, exceeds 130% of the nominal value of the bonds;

in respect of all bonds outstanding, at any time, if less than 10% of the bonds issued remain outstanding, through reimbursement at the Early Reimbursement Price.

Company intervention regarding outstandingOCEANESSince 1 January 2005, the Company has not conducted buybacks of outstanding OCEANES.

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Share capital



Changes in share capital since 25 March 1998

Date OperationsChange in number

of share Nominal (in euros)Amount of share capital (in euros) Share premium

Number of shares comprising capital

25 March 1998 Free shares 7,343,130 11,194,529.52 14,926,039.36 9,790,840

25 June 1998

Merger-absorption of Altran International and removal of old shares 19,018 28,992.75 14,955,032.11 1,940,710.75 9,809,858

21 December 1999 Exercise of options 195,236 297,635.36 15,252,667.48 3,207,021.03 10,005,094

21 December 1999 Euro conversion (5,247,573.48) 10,005,094 10,005,094

21 December 1999 Free shares 20,010,188 20,010,188 30,015,282 30,015,282

2 January 2001 Value divided by 2 30,015,282 30,015,282 30,015,282 60,030,564

2 January 2001Incorporation of retained earnings 30,015,282 15,007,641 45,022,923 90,045,846

31 December 2001 OCEANE conversion 27 13.5 45,022,936.5 90,045,873

31 December 2001 Exercise of options 1,670,508 835,254 45,858,190.5 9,104,268.60 91,716,381

December 31, 2002 OCEANES conversion 21 10.5 45,858,201 91,716,402

December 31, 2002 Exercise of options 1,917,729 958,864.5 46,817,065.5 11,352,955.68 93,634,131

23 December 2003 Capital increase in cash 20,807,584 10 403 7 92 57,220,857.50 135,522,072 114,441,715

10 February 2004 OCEANES conversion 147 73.50 57,220,931 114,441,862

9 March 2004 OCEANES conversion 3 1.50 57,220,932.50 114,441,865

22 December 2004 OCEANES conversion 230 115 57,221,047.50 114,442,095



27 December 2004 OCEANES conversion 87 43.50 57,221,107 114,442,214

23 May 2006Capital increase reserved for employees 2,872,255 1,436,127.50 58,657,234.50 117,314,469

29 December 2006 Capital increase reserved for employees 1,768 884 58,658,118.50 117,316 ,237

21.2 INCORPORATION AND ARTICLES OF ASSOCIATION

Date of incorporation and term

The Company was incorporated on 14 February 1970. Except in the event of early dissolution or extension provided for by Law or the articles of association, its existence will come to an end on 14 February 2045.

Corporate purpose

Under the terms of Article 3 of the articles of association, the Company’s trading objective both in France and abroad is:

technical studies, high-technology consulting and engineering and associated services; and

in general all industrial, commercial and fi nancial operations, involving moveable or fi xed assets, that may be directly or indirectly associated with the corporate purpose or likely to facilitate its extension and development.

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Incorporation and articles of association


21Additional information

Business and Companies Register

702 012 956 RCS Paris

Siret code: 702 012 956 00042

NAF code: 742C

Shareholders’ right to ongoing information

Shareholders may exercise their right to ongoing information in keeping with the legal and regulatory provisions of the Company’s administrative headquarters.

Financial year

The fi nancial year begins on January 1 and ends on December 31 of each year.

Statutory distribution of profi ts (Article 21 of the articles of association)

A deduction of at least 5% is made from the net earnings of each fi nancial year, less previous losses if applicable, to constitute the legal reserve fund until this fund reaches one tenth of the share capital.

The balance, less sums allocated to reserves in accordance with the Law or articles of association and plus any earnings carried forward, constitutes the distributable earnings.

Sums are deducted from these distributable earnings which, at the proposal of the Management Board, the General Meeting deems it appropriate to set and are either carried forward to the following fi nancial year or allocated to one or several general and special reserve funds.

Any remaining balance in net earnings is fully divided among the shares.

The General Meeting may decide to distribute sums deducted from the available reserves. In this event, the decision expressly indicates from which reserve entries the deductions are made.

In a departure from the provisions of this article, an allocation is made if applicable to the special reserve for employee profi t sharing as per the conditions laid out by Law.

At the proposal of the Management Board, the General Meeting may decide that the earnings from a fi nancial year will be entirely or partially carried forward or allocated to the reserves.

Terms of dividend payment

The General Meeting convened to approve the annual fi nancial statements may give shareholders, in respect of all or part of the dividend distributed, a choice between payment in cash or in new shares to be issued under the conditions stipulated by Law. The same principle may be applied to the payment of dividend advances.

As the dividend prescription period is 5 years, all shareholders have the right to claim dividends to which they are entitled within this period from the dividend due date. Once the 5-year period has passed, unclaimed dividends become the property of the Public Treasury, in accordance with legal provisions.

Total unclaimed dividends during financial years

1999 €865.66

2000 €3,360.56

2001 €2,706.00

2002 NA

2003 NA

2004 NA

2005 NA

General Meetings (Article 20 of the articles of association)

The following provisions result from the current wording of Article 20 of the articles of association:

shareholder meetings are convened and deliberate as per the conditions stated by law;

meetings take place either at head offi ces or at another location stated on the invitation. When convening a meeting, the Management Board may decide to publicly transmit the entirety of the meeting via videoconference and/or remote transmission, subject to legal and regulatory provisions in effect. If applicable, this decision is notifi ed in the meeting notice and invitation;

General Meetings are attended by all shareholders, regardless of how many shares they hold provided that they are fully paid up;

all shareholders may participate, in person or by proxy, in the meetings by providing supporting evidence of their identity and ownership of their shares;

all shareholders may vote by mail by using a form that can be obtained under the conditions indicated on the meeting invitation;

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at general meetings, the conditions of quorum stipulated by law in accordance with the type of meeting are assessed by taking into account the number of shares with voting rights. In the case of mail voting, only forms duly completed and received by the Company at least three days before the meeting is held will be taken into account when calculating quorum.

If the General Meeting of 29 June 2007 approves the 17th resolution, Article 20 of the articles of association will be altered so as to align it with the provisions of the Decree of 11 December 2006 modifying the Decree of 23 March 1967 on commercial enterprises.

The full text of the new Article 20 can be found in the 17th resolution presented in the Reference Document in pages 169 and 171.

Double voting rights (Article 9 of the articles of association)

Double voting rights were established by the General Meeting of shareholders of 20 October 1986.

Every share is accompanied by a right to vote in the General Meetings. The number of votes attached to shares is in proportion to the quota of capital that they represent, with each share bearing the right to one vote.

However, the holders of registered shares or their proxies, if these shares have been registered in their name for at least four years and are fully paid-up, or if they arise from the reverse stock split of shares all registered in their name for at least four years and fully paid-up, have two votes for each of the aforementioned shares at ordinary and extraordinary General Meetings.

All shares converted to bearer shares or the ownership of which changes lose the double voting right awarded as per the previous paragraph. Nevertheless, a transfer following inheritance, the liquidation of the joint assets of spouses or donation inter vivos to a spouse or a family member of inheritable degree does not result in a loss of the right acquired and does not affect the timeframes of the aforementioned paragraph.

Share ownership thresholds (Article 7 of the articles of association)

In keeping with the provisions of Articles L. 233-7 et seq. of the French Commercial Code, any person acting alone or jointly who comes to hold more than a twentieth, tenth, fi fth, third, half or two thirds of the capital or voting rights must inform the Company and the Conseil des Marchés Financiers of the number of shares and voting rights that s/he holds. The same principle applies when a shareholder’s participating interest drops below the aforementioned thresholds.

a Furthermore, any person acting alone or jointly who comes to hold, directly or indirectly, a fraction of the capital or voting rights giving future access to the Company’s capital equal to or greater than 0.5% or a multiple of this fraction shall be obliged to notify the Company, by recorded delivery letter with acknowledgement of receipt within a period of fi fteen days starting from the crossing of one of these thresholds, of the total number of shares, voting rights or securities giving future access to the capital that s/he holds alone, directly or indirectly or jointly.

Any person acting alone or jointly is also obliged to inform the Company within a period of fi fteen days when their percentage of the capital or voting rights drops below each of these thresholds.

Non-observance of these provisions may be penalised, in keeping with legal provisions, at the request of one or several shareholders holding at least 5% of the share capital or voting rights of the Company, as set forth in the minutes of the General Meeting.

Identifi able bearer shares (Article 7 of the articles of association)

With a view to better identifying the shareholders, the Company may ask the clearing organisation for the information stipulated in Article L. 228-2 of the French Commercial Code.



On the date of registration of this Reference Document, the Group had not concluded any major contracts, other than those concluded under normal business conditions and with the exception of the contract with banks described in pages 96 and 97 of this Reference Document.

22 Major contracts


To date, the Company has received no declaration of interests.

23 Information provided by third parties, declarations by experts and declarations of interests


Financial information is primarily provided through releases sent to the press (agencies and newspapers). All fi nancial information (press releases, presentations, reports) is available on the Group’s website at http://www.altran.net.

Summary of communications made since 1 January 2006

Date Publication

2 February 2006 2005 total revenues

13 March 2006 Implementation of an employee shareholding plan

3 April 2006 2005 annual results

5 May 2006 Revenues for 1st quarter 2006

11 May 2006 Employee shareholding plan

8 June 2006 Annual Shareholders Meeting

3 August 2006 Revenues for 2nd quarter 2006

24 September 2006 Appointment of Mr. Yves de Chaisemartin as chairman of Management Board

2 October 2006 Results for 1st semester 2006

31 October 2006 Revenues for 3rd quarter 2006

12 December 2006Documents made available to shareholders in preparation for the Annual Shareholders Meeting on 29 December 2006 Report on the Extraordinary Shareholders Meeting

29 December 2006 Annual shareholders meeting results

9 February 2007 2006 Total revenues

27 February 2007 Appointment of Mr. de T’Serclaes

2 April 2007 2006 results

31 may 2007 The Altran group has acknowledged the decision of the AMF’s disciplinary committee

Publications calendar

Revenues for 2nd quarter 2007 31 July 2007

Annual Shareholders Meeting 29 June 2007

Results for 1st semester 2007 31 August 2007

Revenues for 3rd quarter 2007 6 November 2007

Press release - 31/05/2007

The Altran group has acknowledged the decision of the AMF’s disciplinary committee

The Altran group has acknowledged the decision of the AMF’s disciplinary committee relating to the accounts for 2001 and the fi rst half of 2002, imposing a fi ne of 1.5 million Euros.

The committee decided to take disciplinary action against the company owing to actions for which its former directors, who have all left the group, have been criticised.

This decision does not bear in mind the conclusions of the committee’s reporter, who recommended a far more moderate fi ne, as it penalises all Altran’s current shareholders for the actions of their predecessors.

Although the group would like to conclude the matter once and for all, the Management is currently looking into the possibility of an appeal.

Finally, Altran has stated that provision had been made for the possibility of a fi ne in the group’s accounts.

24 Documents accessible to the public


25 Information on participating interests

All information relating to the scope of consolidation is available on pages 82 to 87 of this document.


APPENDIX 1 INTERNAL CONTROL

Report of the Chairman of the Supervisory Board on Internal Control for the fi nancial year ended 31 December 2006 (Article L. 225-68 of the French Commercial Code (Code de commerce).

In accordance with Article L. 225-68 of the Commercial Code, this report sets down details of the preparation and organization of the Board’s tasks, as well as the internal control procedures which the company has put in place.

The points below will be presented as follows:

corporate governance;

procedures for internal control and those relating to preparation and processing of Group accounting and fi nancial data;

1. Corporate governance

1.1 Preparation and organization of the tasks of the Supervisory Board

In June 2005, Altran Technologies adopted a style of administration by Management Board and Supervisory Board, thus enabling management and control functions to be shared between these two bodies, with a consequent balancing of powers.

1.1.1 The Management BoardAt the start of the 2006 fi nancial year, the Management Board was composed of two members, Mr Christophe Aulnette, Chairman of the Board, and Mr Eric Albrand. It gained a member with the appointment of Mr François-Xavier Floren in June 2006.

On 24 September 2006, the Supervisory Board accepted the resignation of the Chairman of the Management Board, Mr Christophe Aulnette, and appointed Mr Yves de Chaisemartin to replace him.

On 20 November 2006, the Board accepted the resignation of Mr François-Xavier Floren from his duties as a member of the Supervisory Management Board.

At end 2006 therefore, the Management Board has two members, Mr Yves de Chaisemartin, Chairman, and Mr Eric Albrand. Details on their mandates and duties are given in §7.1.3 of the management report.

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1.1.2 The Supervisory Board

Composition of the Supervisory BoardFollowing the resignation of Mr Yves de Chaisemartin as Chairman and member of the Supervisory Board on 24 September 2006, the resignation of Mrs Guylaine Saucier on 15 February and the coopting of Mr Jacques-Etienne de T’Serclaes at the Supervisory Board meeting of March 2007, with effect from 30 March 2007, the Supervisory Board is now made up the following members:

Mr Dominique de Calan, Chairman;

Mr Michel Sénemaud, Deputy Chairman; Mr Roger Alibault;

Mr Jacques-Etienne de T’Serclaes.

Their mandates will expire at the Annual General Meeting called to vote on the accounts at the close of fi nancial year 2008.

Mr Dominique de Calan was elected Chairman of the Supervisory Board on 29 September, succeeding Mr Yves de Chaisemartin, who was appointed Chairman of the Management Board on 24 September 2006.

The members of the Supervisory Board meet the criteria set by the Bouton report with respect to their independence, in that they have no relationship of any nature with the Company, the Altran Group or with management which might compromise the exercise of their freedom of judgement.

Representatives of the Staff Council present at the Supervisory Board meetings are:

Mr Heni Massouri;

Mr Bertrand Cahuzac.

Operation and tasks of the Supervisory BoardIn the event of absence, the Chairman or Deputy Chairman convenes the Board and presides over its debates. The agenda is prepared by the Supervisory Board in concertation with the Management Board. A fi le detailing the contents of subjects on the agenda is provided for each member of the Supervisory Board before the meeting. The Legal Director is in charge of the secretariat.

A draft agenda is presented to members of the Supervisory Board at the same time as the convocation for the following Board meeting and is approved at that meeting.

During the fi nancial year ended 31 December 2006, the Supervisory Board met 14 times, with an attendance rate of 94% by members of the board. The members of the Management Board were present at meetings of the Supervisory Board.

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Internal control

The main issues discussed were:

appointment of members of the Management Board;

business developments, the situation of subsidiaries, forecasting documents;

the adopting of a new organization plan; examination of the restructuring plan for the Group;

examination of the accounts at 31 December and 30 June 2006, and the quarterly turnover;

monitoring of the work of the internal audit department;

examination of signifi cant lawsuits;

authorizations given to the Management Board in respect of guarantees, securities and warranties;

approval of the total stock options envelope.

1.1.3 Limitations to the powers of the Management Board

Article 14.1 of the statutes states that, when it rules on the following issues, the Management Board must have the prior agreement of the Supervisory Board deciding the majority conditions set down by Article 16.4 of the present statutes: :

any increases or reductions in registered capital in excess of an amount to be specifi ed by the Supervisory Board;

any operations giving access to the capital, other than a capital increase, in excess of an amount to be specifi ed by the Supervisory Board;

any operations in respect of securities issues, other than a capital increase, in excess of an amount to be specifi ed by the Supervisory Board, with the exception of securitization operations;

determination of the total envelope and the general principles for allocation of stock options or free shares, it being understood that the naming of benefi ciaries an well as the determination of the number of stock options or free shares granted shall be the responsibility of the Management Board. However, the granting of stock options or free shares to members of the Management Board must fi rst be approved by the Supervisory Board;

any operation by the Company or one of its subsidiaries to acquire or to sell, by any means, a business or a company, in excess of an amount to be specifi ed by the Supervisory Board, with the exception of purchase or disposal operations between Altran and one or several of its subsidiaries;

any operation resulting in the Company losing control, within the meaning of Article L. 233-3 of the French Commercial Code, and/or losing effective management where it has a controlling interest and where net book value is in excess of an amount to be specifi ed by the Supervisory Board;

any operation to totally or partially merge or sell the Company;

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any modifi cation to the corporate purpose or the form of the Company;

any disposal of the Company’s fi xed or fi nancial assets in excess of an amount to be specifi ed by the Supervisory Board;

any borrowing by the Company in excess of an amount to be specifi ed by the Supervisory Board, with the exception of securitization or factoring operations;

any signifi cant operation of a kind which could bring substantial changes to the fi nancial structure of the Company and the Group it controls.

In accordance with this Article, the Supervisory Board, at its meeting of 30 June 2005, set the following amounts which were confi rmed in the meeting of 8 June 2006:

1. 5 million euros for any operation by the Company or one of its subsidiaries to acquire or to sell, by any means, a business or a company, with the exception of purchase or disposal operations between Altran and one or several of its subsidiaries;

2. 5 million euros for any operation resulting in the company taking control, within the meaning of Article L. 233-3 of the Code of Commerce, and/or effectively taking over management of the controlled company where the net book is value in excess of an amount to be specifi ed by the Supervisory Board;

3. 5 million euros for any divestiture of the Company’s fi xed or fi nancial assets;

4. 5 million euros for any borrowing by the Company, except for securitization and factoring operations.

The Supervisory Board is assisted by two committees: the Audit Committee and the Appointments and Remuneration Committee.

1.2 Specialized committees

1.2.1 The Audit CommitteeThe Committee performed its mission throughout fi nancial year 2006. After July 2005 and until 15 February 2007, the Audit Committee was composed of Mrs Guylaine Saucier, Chairman, Mr Roger Alibault and Mr Sénamaud.

During its meeting of 5 March 2007, the Board appointed Mr Jacques-Etienne de T’Serclaes to replace Mrs Saucier as Chairman of the Audit Committee from 30 March 2007.

The missions of the committee are to assist the Board in checking the accuracy and fair presentation of the Altran Technologies company accounts and consolidated accounts, to monitor that rules on the independence of the Group’s statutory Auditors are respected, and to ensure quality of the information delivered. In this framework, the committee will in particular:

study assumptions used in closing the accounts, study the corporate accounts and the consolidated annual, half-yearly and quarterly accounts before their examination by the Board, Internal controlwith

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regular tracking of the fi nancial situation, the cash position and commitments of the Company; particular attention being given to the impact of changes in the accounting method, information on regulated agreements, the policy on provisioning and changes in performance from one accounting period to another and to give notice of any failure to respect these regulations; the Audit Committee transmits to the Supervisory Board any observations it may have;

review and ensure the relevance of Group accounting policy and recommend suitable changes;

assess the Group’s internal control systems and make recommendations on organization of the internal audit and its missions;

receive and analyse any relevant audit document concerning the situation of Altran Technologies and its subsidiaries, together with responses made by the Management Board;

communicate its opinion to the Supervisory Board on the choice of statutory Auditors proposed by the Management Board in view of their appointment by the Annual Meeting of Shareholders; analyse and express an opinion on the defi nition of their mission, their fees, the scope of their intervention and its schedule; analyse and give a recommendation on services related to the audit and on missions outside the fi eld of the statutory audit carried out by the Auditors, taking account of the possible impact of these missions on the independence of the Auditors, the recommendations made these latter and the resultant actions carried out;

review all fi nancial communication from the Group on the half-year and annual accounts as well as the quarterly turnover and any other communication of a fi nancial nature;

analyse any lawsuits, including on fi nancial issues, of a kind which might impact signifi cantly on the accounts of the Company and/or the Group or on its fi nancial position;

examine the Group’s exposure to risks and the major off-balance sheet commitments, off-balance sheet commitments linked to current business, with a description of complex commitments, an analysis of commitments and other signifi cant contractual obligations, and a description of collectability with regard to fi nancial debt (known as “default clauses”) in the event of a deterioration of the Group’s position;

examine the legal and industrial risks relating to the Group’s business and also market risks (rates, exchange, shares etc.);

examine procedures to ensure compliance with stock market regulations.

The internal regulations governing the Audit Committee, adopted by the Board meeting of 7 October 2003, continue to apply to the Audit Committee appointed by the Supervisory Board meeting of 5 March 2007.

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The Audit Committee convened nine times in the course of 2006, attended by the Auditors in order to analyse the following main issues:

examination of the 2005 annual accounts and the half-year accounts for 2006;

pre-publication review of quarterly fi gures;

examination of the Company’s fi nancial communication (press releases, presentations for industry analysts, annual report, reference document);

organization of work involved in the internal audit and its follow-up (review of risk mapping, review of tasks performed for the 2006 audit, defi nition of the internal audit plan for 2007);

monitoring of action to improve internal control (implementation of a new reporting tool, setting up procedures to improve processes for closing accounts and for cutting lead times.

The Audit Committee was informed of the contents of this report at its meeting of 18 April 2007.

At the start of its meetings, the Audit committee meets with the Auditors without the presence of management.

1.2.2 The Appointments and Compensation CommitteeThe Appointments and Compensation Committee carried out its mission throughout fi nancial year 2006. From July 2005 and until 15 February 2007, the Appointments and Compensation Committee was composed of Mr Dominique de Calan, Chairman, Mrs Guylaine Saucier and Mr Michel Sénamaud.

At its meeting of 5 March 2007, the Board appointed Mr Roger Alibault to replace Mrs Guylaine Saucier.

The Committee is also required to make recommendations to the Supervisory Board with respect to:

determination of fi xed and variable remuneration as well as benefi ts in kind, retirement pensions and healthcare benefi ts for members of the Management Board, the Executive Committee and the principle directors of the Group;

ensuring that rules on setting the variable part of salaries are coherent with the annual performance assessment of members of the Management Board and the senior directors of the Group, and, in addition, checking that these rules are applied;

policy on remuneration, including the principles behind the breakdown of fi xed and variable parts, criteria by which the basis for variable parts is calculated and rules for allocation of possible bonuses and premiums;

human resources policy and, in particular, policy to create employee loyalty;

appointment of members of the Executive Committee, the main directors of the holding company and the leading companies in the Group.

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defi nition of the total amount of directors’ fees to be put to the decision of the Annual Meeting of Shareholders and the rules for apportionment of these fees between members of the Board;

preparation of a list of benefi ciaries of the plan on share option subscription or allocation of free shares amongst the members of the Management Board and the main directors of the Group;

preparation of a list of benefi ciaries of all types of profi t-sharing amongst Group employees;

examination of methods and implementation of any plan for employee or management stock ownership.

The Committee met on fi ve occasions in 2006.

The main issues discussed were as follows:

remuneration of members of the Management Board;

policy on remuneration of Executive Committee members;

employee stock ownership plan.

2. Consolidation of the organization of internal control and the Group system for accounting and financial information

The object of internal control, when correctly structured and implemented, is to ensure prevention and control of risks arising from the business of Group entities and risks of error or fraud, particularly in the areas of accounting and fi nance. It is also directed at ensuring compliance with the laws and regulations in force. It contributes to the transparency of the organization, protection of Group assets, management and effective monitoring of operations, enhancement of performance and cost control. Nevertheless, as with all control systems, it can provide only a reasonable assurance, but in no case an absolute guarantee, that these risks are fully eliminated.

In order to develop internal control within the Altran Group, structures have been deployed progressively as from 2003 and action undertaken has been directed, fi rstly, at defi ning rules for internal control and, secondly, to harmonise and consolidate the security of data systems directly linked to accounting and fi nancial information.

These measures apply to all companies within the Group’s scope of consolidation.

2.1 Implementation of a new operational organization

2.1.1 An appropriate structure of company governance

The Group Executive CommitteeIn December 2006, the Group put in place a new corporate governance structure composed of an Executive Committee and an Operations

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Committee, thus meeting two basic objectives: management ensuring that Company functions effectively on a daily basis and growth of its turnover in France and internationally.

The Executive Committee is composed of:

Yves de Chaisemartin, Chairman of the Management Board;

Eric Albrand, M ember of the Management Board responsible for fi nance;

Cyril Roger, Deputy General Manager ;

Frédéric Grard, Deputy General Manager ;

Pascal Brier, Deputy General Manager in charge of strategy, marketing and communication.

The Operations Committee is composed of fi ve members representing Altran’s diverse areas of operation and geographical zones. The setting-up of this Committee is the result of our wish to closely link operations directors with the growth of the Group and to give fresh energy to this growth. It is made up of:

Dominique d’Andrimont, Executive Director of Altran Benelux & Scandinavia;

Jose Ramon Magarzo, Executive Director of Altran Spain;

Yves Rommel, Executive Director of Altran Germany, Austria and Switzerland;

Laurent Sicart, Executive Director, France Regions;

Michael Träm, Chief Executive Offi cer, Arthur D. Little.

The Group’s Executive Committee is composed of members of the Management Board and members of the Operations Committee.

2.1.2 Operations OrganizationIn 2006, the Group carried out major changes to its operational organization, with the following objectives:

to enhance the interface with clients;

promote cooperation between the entities in the Group;

facilitate value-added offerings and spread their use throughout the Group;

streamline operations.

The fi rst phase was to ensure that activity in Paris and out of Paris is clearly delimited in France.

The second phase, in France and internationally, made it possible to bring together entities and activities in the fi eld of information services and related consulting under a single lead brand-name, Altran CIS (Consulting and Information Services) under a single management, and, when required by market conditions, in a single company (as in Italy or Germany).

The third phase consisted in amalgamating into one operational entity all consulting activity in France in the fi elds of technologies and innovation, and to defi ne four perimeters corresponding to target

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markets, bearing in mind that business in other parts of France is structured primarily on a geographical basis:

Automobile, Infrastructure and Transport;

Telecoms, Electronics and Media;

Aeronautics, Space and Defence;

Energy, Industry and Life Sciences.

The 26 French companies involved in this new operations organization were legally merged with Altran Technologies by decision of the General Meeting of 29 December 2006.

In addition, Arthur D. Little now benefi ts from appropriate governance with a CEO. having authority over Arthur D. Little offi ces in each country.

Good performance internationally, also by Arthur D. Little, together with stabilisation of turnover in France in the second half are the immediate consequence of these reorganizations.

2.2 Main internal control procedures and measures to ensure efficiency of management and tracking of risk management operations linked to business

2.2.1 Implementation of new toolsAt end 2005, the Group launched work to progressively harmonize and upgrade its entire technical information architecture, necessary for harmonization of management tools, their effi ciency and for a reduction in cost. This work continues in 2007.

The Group has also decided to implement a single transactional tool (ERP). The choice was Microsoft Navision for subsidiaries out of France and outside ADL business. The development and testing phase in pilot companies was completed at end-2006 and the tool began to be put in place in January 2007. For French subsidiaries and outside ADL business, harmonization is underway based around Adonix, the tool used in 2006 by the majority of the companies involved.

The operations organization of the Group has been decentralized. However, the introduction in all the Group subsidiaries in 2004 of Magnitude, the reporting and consolidation tool enables centralized communication and a common data base.

In this way, improved information tools contribute to the structuring of internal control in the Group.

2.2.2 Framework procedures in internal controlIn 2004 and 2005, the Group developed framework agreements to consolidate its internal control, harmonize practices within the Group and optimize performance.

Implementation of these internal control procedures, tested by means of audits and self assessment questionnaires proved to be inconsistent.

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The Group therefore launched a process to determine standard modes of operation both centrally and where the subsidiaries are concerned. This process will allow adaptation and update of these procedures within the Group to be deployed in 2007, at least for procedures applying to priority processes.

2.2.3 Procedures relating to preparation and processing of accounting and financial information in the Group

These are procedures designed to provide rigorous accounting management and fi nancial monitoring of the Group’s activities. They contribute to the production of data which is reliable and in compliance with legal and regulatory requirements and the standards set down by the Group.

Management reporting by the subsidiaries on a monthly basis is consolidated by Group management control in a single tool (Magnitude).

The Group called on an external consulting fi rm at end-2006 to assist in putting in place a Group fi nancial management system leading to better forecasting of changes in business and margins.

Since 2005, in most countries where it is present, the Group has implemented joint service centres covering accounting functions, sales administration and management of pay. The purpose of these centres is to bring these support functions together and improve their degree of professionalism. They progressively include a growing number of operational companies.

From 2005, with the implementation of IFRS standards, the Group has produced a manual of its accounting standards, stating the accounting concepts used within the Group and accounting processes for operations considered most signifi cant for the Group.

The objective of the reduced number of operational subsidiaries, (104 at end 2006 compared with 146 in 2005), the extension in joint services centres and improved procedures is to improve reliability and lead times in production of fi nancial information. The capacity to absorb these many organizational changes continues nevertheless to be a challenge.

2.2.4 Implementation of reference standards for internal control and self-assessment process

From start-2006, assisted by the internal audit, a set of reference standards for internal control was set up, with the aim of identifying all essential controls on processes which management deems critical. This involves a breakdown of the company in terms of key processes and sub-processes considered to apply throughout the company or at a local level in operational entities), or centrally (in “corporate” processes).

From June 2006, on the basis of the internal control reference standards and assisted by the internal audit, the Group also set up a self assessment procedure for internal control of procedures in operational entities identifi ed as critical by general management.


Appendix 1

Internal control

This process will allow subsidiaries to have better awareness of risks and to follow a path of continuing progress to meet the objectives set by the Group.

2.3 Internal audit departmentOn the recommendation of the Audit Committee, the Board of Directors decided to create an internal audit department and outsource this function, which was entrusted to Price Waterhouse Coopers as from June 2004.

The internal audit department reports to the Chairman of the Management Board, the Chairman of the Supervisory Board and, on the authority of the latter, to the Chairman of the Audit Committee. It carries out its missions in the framework of an internal audit charter, approved by the Supervisory Board, the Management Board and the Audit Committee. The latest version of the charter dates from 20 July 2006.

Work to identify risks to the Group took place in 2004. This work was entirely updated at end-2005 and start-2006 in order to create segmented risk mapping in accordance with the key company processes (as identifi ed by company management), either at central level or at the level of the operational units.

Perception of risks was updated during a meeting with general management at end-2006, as a support in the preparation of the 2007 internal audit plan.

This audit plan was produced in accordance with the audit charter, and in a context which is multi-annual, with the object of covering all Group entities in the course of a three-year control cycle (2006-2008).

On the basis of this risk mapping, a set of internal control reference standards was drawn up. This served as a basis for the work carried out by the internal audit during year 2006.

In 2003, internal audit missions were performed in 18 Group entities (9 in France and 9 out of France) covering all or a part of the priority themes identifi ed by general management.

Added to this is the work involved in the task of tracking internal audit recommendations made the previous year, assistance in organizing self-assessment and audits at the request of management and the Audit Committee.

These audits led to recommendations to bring improvements to internal control of processes involved in respect of management of entities and responsibility for their deployment.

2.4 Tasks of the AuditorsIntervention by the parent company Auditors was considerably increased as from 2004.

The Auditors for the Group are Deloitte (appointed in June 2004) and Mazars (appointed in June 2005). They act as Auditors in all subsidiaries within the scope of consolidation.

This cover, together with the reduced number of interventions in the subsidiaries have helped harmonize controls throughout the Group and facilitate transfer upwards of observations made in the course of controls on the spot.

The principle of a review of turnover has been maintained, meaning controls in the fi eld which, each quarter, cover subsidiaries representing over 40% of turnover. A report of this review is presented to the Audit Committee and the Supervisory Board before publication of quarterly turnover.

In addition, to take account of the steadily growing contribution of new internal control processes, the Auditors put in place controls covering all consolidated subsidiaries at year-end closing and gave preference to a substantive approach.

These are the subject of many exchanges with fi nancial management and a detailed report to the Audit Committee.

ConclusionOver recent years, the Altran Group has substantially modifi ed and consolidated processes in corporate governance, audit and internal control. In 2006, major organizational changes took place which, as well as impacting positively on business development, will simplify and rationalize internal processes, once the initial adaptation phase is past.

These efforts to streamline and consolidate internal control will be continued and intensifi ed in 2007.

Dominique de Calan

Chairman of the Supervisory Board


Appendix 1

Internal control

Observations by the Supervisory Board on the accounts for the financial year ended 31 December 2006 and on the report of the Management BoardAs provided by the law, the Management Board presented to the Supervisory Board the consolidated fi nancial statements of the Altran Group, the corporate accounts of Altran Technologies S.A. and the management report on the activity of the Group and its performance for the fi nancial year closed 31 December 2006.

The Supervisory Board examined the fi nancial statements, the Management Board report and heard the observations of the Audit Committee of the Board. It has no observations to make on these documents

The Supervisory Board also examined the text of the resolutions of the Management Board presented at the combined Annual Ordinary and General meeting of Shareholders. It recommends the combined General Meeting of Shareholders to adopt all resolutions proposed to it.


GENERAL ASSEMBLY OF SHAREHOLDERS 29 JUNE 2007

Information provided to shareholders

The information stipulated in the Code of Commerce (art. L. 225-100, L. 225-102, L. 232-1)

Chapter 4: Risks

Chapter 9: Management Report

Chapters 14, 15 and 16: Corporate governance, internal audit , remuneration and benefi ts.

REPORT BY THE MANAGEMENT BOARD TO THE GENERAL ASSEMBLY

1. Presentation of resolutionsWe ask you to pronounce upon authorisation to be granted to the Board of Directors in order for the Company to carry out the purchase of its own shares.

This authorisation is to be granted for a duration until the end of the General Assembly called to rule on the accounts of the fi nancial year to close the 31 December 2007 and may be used by the Management Board subject to the provisions of Article 14.1 of the articles of association.

It will be proposed to you that you ratify the co-option to the position of member of the Supervisory Board Mr Jacques-Etienne de T’Serclaes, decided by the Supervisory Board on the 5 March 2007, with the date of effect of 30 March 2007.

We are also requesting that you approve the resolutions aimed at granting the Management Board the powers and authorisations allowing it, where applicable, to carry out, based only on its own decisions, various fi nancial operations leading to the issuing of debt securities, and any issuing of securities giving immediate or eventual access to the capital of your Company with maintenance and/or withdrawal of preferential subscription rights.

Furthermore, we ask you to grant to the Management Board the powers necessary in order to issue shares or any kind of security up to a limit of 10% of the issued capital, with a view to remunerating contributions in kind, capital stock or securities giving access to the capital of third party companies.

In addition, we request that you approve the resolutions delegating to the Management Board the possibility of issuing securities with a view to remunerating contributions in kind, and of increasing the capital by the incorporation of reserves, profi ts or bonuses.

We also thank you for authorising the Management Board to increase the number of securities to be emitted if an increase in issued capital is required, without or without preferential subscription rights; increases carried out within the scope of resolutions 10, 11 and 12, as a consequence.

We also propose that you authorise the Management Board , in accordance with articles L. 228-91, L. 225-129 and following and L. 225-138 of the Code of Commerce, to issue, on one or more occasions, bonds with redeemable warrants for subscription or acquisition (OBSAR).

The maximum par value of increases in issued capital which may be carried out by virtue of the authorisation which we are asking you to grant to the Management Board is 15 million euros and the maximum value of the OBSAR which may be issued by virtue of the resolution we are asking you to approve is 250 million euros.

A detailed report by the Management Board on this operation has also been issued and will be presented to you.

As a consequence of the authorisations proposed to you regarding the increase in issued capital, you will be called upon to pronounce on granting authorisation to the Management Board for the purpose of carrying out issued capital increases reserved for the subscribers to a Savings Plan.

You are requested to pronounce on authorising the Management Board to reduce the issued capital through the cancellation of shares.

Finally, we ask you to completely rewrite Article 20 of the articles of association of your Company in order to make it comply with the decree of 11 December 2006, modifying the decree of 23 March 1967 on commercial companies.

Appendix 2


Appendix 2

Environmental and social report 2006

2. Pecuniary injunctions for anticompetitive practices pronounced by the Conseil de la Concurrence (French agency regulating market competition)

No injunction has been declared on the date that this report was drawn up.

3. Directors’ feesWe remind you hat the General Assembly of Shareholders of the 8 June 2006 set the overall amount for directors’ fees at 440,000 euros for 2006 and each following year until it is decided otherwise.

ENVIRONMENTAL AND SOCIAL REPORT 2006

1. WorkforceThe total workforce of the company Altran Technologies, on 31 December 2006, was 5,592 employees.

This workforce is the result, following the Extraordinary General Assembly of 29 December 2006, of the merger into one entity of 26 companies of the Technology and Innovation segment of the Altran Group:

Acsience; Actisys; Adena Technologies; Alplog; Altair Technologies; Altior; Altran Avenir; Ariane Ingénierie; Atlantide; Berata; Berata Paris; CGS Executive Search; Ciriel; Cogix; Cortical; Gerpi; Grenat; Hémisphères; Inoquant; Logiqual; Lore; Orthodrome; Partenaire Securité Informatique (PSI); Realix Technologies; Segime; Sivan Consulting.

99.03% of employees are employed on permanent contracts.

Altran Technologies has employed 1,856 employees on permanent contracts and 76 employees on fi xed-term contracts.

2. RedundanciesIn 2006, the total number of redundancies was 225, most of which were announced in 2005 in the context of a plan to reduce indirect costs on the basis of a voluntary redundancy plan.

3. OvertimeWith regards to the status “executive” of the employees of Altran Technologies (that is 96.15% of the workforce), and the fl at rate of 218 days worked per year inherent to this status, any signifi cant incidences of exceeding working hours are compensated by the TEA system (tranches exceptionnelles d’activité – exceptional blocks of activity) which means days can be recovered through time in lieu in accordance with the nation SYNTEC agreement on working hours.

The application of the reduction in working hours scheme allows executive-level employees to enjoy, depending on the year, an additional 9 to 13 days off per year.

Non-management employees have 12 days a year off through the reduction in working hours scheme.

The provisions introduced within the scope of the reduction in working hours scheme mean that the number of overtime hours is insignifi cant.

4. Labour external to the CompanyOn the 31 December 2006, the cost of external labour required by Altran Technologies, via temporary employees, was 1,066,168 euros.

Temporary work essentially covered short-term substitution (average of 2 to 3 months)

5. Organisation of working hoursThe conventional working week is 35 hours.

For most executive-level employees, working hours are organised on the basis of an annual fi xed amount of 218 days worked, with a weekly reference timetable of 38.5 hours, in compensation for the days given under the reduction of working hours scheme.

Out of a total of 5,593 employees, 52 have part-time employment contracts.

6. Remuneration and changesEfforts to control our payroll costs have been introduced. The principle of individual salaries has been maintained: to this effect, the annual evaluation interview has been made compulsory. The introduction of career committees has been initiated.


Appendix 2


7. Personnel costsThe gross salaries paid to employees in 2006 was 246,942,901 euros.

The company’s social security obligations reach 24,594,917 euros (including 4,190,723 euros for health and contingency funds and 20,404,194 euros for additional retirement coverage).

Other charges are for URSSAF social security contributions, unemployment insurance, medical visits, etc.

8. Professional equality between men and women

The Altran Technologies payroll still makes a slight distinction between the salaries of men and women, depending on their positions.

The fi gures show however that the company is willing to make efforts with a view to reducing this salary gap between men and women.

9. Professional relationships and the assessment of collective agreements

Elections of workers’ representatives took place in 2006 in some companies (mostly in February).

In 2006, 356 meetings (ordinary and extraordinary) were organised with the workers’ representatives of Works Councils, consultative committees and the central Works Council. In addition, 144 meetings were organised with workers’ delegates.

This large number of meetings can be explained by the number of companies concerned (27) and by the varied information and consultation procedures of the Works Councils, consultative committees and the central Works Council, procedures made necessary by the Synergie, Krypton and Archimède projects.

10. Information and communicationWithin the company, information circulates upwards and downwards, via communication tools which include:

an Intranet;

a newsletter from the Works Council;

a twice-monthly newsletter from the Company;

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email news messages for employees who are consultants working externally,

the organisation of an exchanges meeting at the level of the operation entities;

themed BU conferences

Regular individual interviews are also organised between:

a consultants and their managers;

administrative or across-the-board staff with their line managers.

This individual interview process also applies to directors and managers.

11. Procedures50 appeals to non-judicial solution methods were carried out in 2006.

32 judicial procedures are still ongoing on 31 December 2006.

12. Health and safety conditionsIn 2006, 53 CHSCT (Health and Safety and Working Conditions Committee) meetings were held in Altran Technologies . This large number of meetings is due to the existence of several CHSCTs (some of the merged 27 companies have one, or even two CHSCTs).

Many activities were carried out to support the introduction of prevention plans with clients and to monitor the journeys of employees to countries which are sensitive due to the unstable political situation or the medical risks they present.

13. Work and travel related accidentsIn 2006, there were 18 work-related accidents leading to the loss of 20 days of work. These accidents did not affect temporary workers or service providers.

No permanent disability resulted from any of these accidents.

One death, following a travel accident, is unfortunately to be deplored.

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Appendix 2


14. Work-related illnessesWith regards to work-related illness, we could not count any work-related illness declared to Social Security, nor any pathological complaint related to work.

15. TrainingIn 2006, 2,387 employees benefi ted from a total of 15,199 hours of training.

Training was carried out both internally and externally, and fi nanced by the FAFIEC or directly by Altran Technologies.

Annual contributions for 2006 to FAFEIC and to FONGECIF for vocational training, apprenticeships and individual training leave represent a total of 1,874,015 euros.

The cost of internal and external training, including payments to organisations, reached 6,105,084 euros.

16. Employment and opportunities for persons with disabilities

In 2006, 11 persons with disabilities, recognised as such by COTOREP, were declared for disability social security payments.

17. Extra staff benefitsThe amount of the budget allocated to the Altran Technologies was 592,663 euros for 2006 for extra staff benefi ts and 493,886 euros as part of the operating budget.

18. Significance of sub-contractingOn the 31 December 2006, the fi gure for sub-contracting was 17,196,011 euros.

This sum concerns contractors of the Altran Group within the scope of centralised cooperation and secondment agreements and external services.

19. Impact on local area in terms of employment and regional development

Altran Technologies takes into consideration the impact on the local area of its activities, in terms of employment and regional development.

Altran Technologies strives to monitor all the employees seconded to companies in the Group, particularly by providing security in terms of health and contingency insurance and repatriation and centralises all requests for visas and work permits.

With regards to sub-contracting, Altran Technologies centralises technical cooperation agreements held with subsidiaries.

The subsidiaries of the company in other countries take into account the impact of their activities on regional development and the local population.

20. Employment policyAltran Technologies has a dynamic employment policy.

Thus, in 2006 the Company recruited 1,932 employees, mainly on permanent contracts at executive level.

Employees are mainly chosen for their expertise, their communication skills and their potential for development. Consultants and managers have all followed higher education (minimum baccalaureate + 5 years).

Consultants are drawn from a mainly scientifi c background, whilst managers have either a science or management background.


Appendix 2

AGENDA OF THE MIXED GENERAL ASSEMBLY OF ALTRAN TECHNOLOGIES 29 JUNE 2007

Ordinary business1. a pproval of the reports and corporate accounts for the fi nancial

year ending 31 December 2006;

2. a pproval of the reports and consolidated accounts for the fi nancial year ending 31 December 2006;

3. allocation of the profi ts of the fi nancial year ending 31 December 2006;

4. approval of the agreements described in articles L. 225-86 and following of the Code of Commerce;

5. authorisation to be given to the Management Board regarding the purchase by the Company of its own shares;

6. authorisation to be given to the Management Board for the purpose of issuing obligations and other similar securities or other securities conferring the same debt rights over the Company;

7. ratifi cation of the co-opting of a member of the Supervisory Board giving powers for formalities;

8. powers to accomplish formalities;

Extraordinary business9. authorisation of the Management Board to reduce the issued

capital through the cancellation of shares.

10. delegation of competence to the Management Board for the purpose of increased the issued capital by issuing shares and securities giving immediate or long-term access to the capital of the Company, maintaining the preferential subscription right;

11. delegation of competence to the Management Board for the purpose of increased the issued capital by issuing shares and securities giving immediate or long-term access to the capital of the Company, withdrawing the preferential subscription right;

12. delegation of competence to the Management Board for the purpose of increasing the issued capital by incorporating reserves, benefi ts, bonuses or others;

13. authorisation of the Management Board to increase the number of securities to be emitted if an increase in issued capital is required with or without preferential subscription rights in application of resolutions 10, 11 and 12;

14. grant to the Management Board the powers necessary in order to issue shares or any kind of security up to a limit of 10% of the issued capital, with a view to remunerating contributions in kind, capital stock or securities giving access to the capital of third party companies.

15. authorisation to be granted to the Management Board to carry out issued capital increases, by issuing shares or other securities which give access to the capital, reserved for subscribers to a company savings plan;

16. delegation of competence to the Management Board to decide upon the issuing of OBSARs;

17. complete rewriting Article 20 of the articles of association of your Company in order to make it comply with the decree of 11 December 2006, modifying the decree of 23 March 1967 on commercial companies;

18. powers to accomplish formalities

Text of the resolutions presented to the Mixed General Assembly of Altran Technologies 29 June 2007

Resolutions falling under the competence of the Ordinary General Assembly

Resolution one(The objective of this resolution is the approval of the reports and corporate accounts for the fi nancial year ending 31 December 2006)

The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, having read the management report by the Management Board and the general report by the statutory auditors on the corporate accounts of the fi nancial year ending the 31 December 2006, having heard the observations of the Supervisory Board on these corporate accounts and on the management report by the Management Board , approves all these corporate accounts, that is, the balance sheet, the profi t and loss account and the appendix drawn up on the 31 December 2006, as they have been presented, as well as the operations shown in these accounts and resumed in these reports. It fi xes the net accounting loss for this fi nancial year at 3,294,618.57 euros.

Resolution two(The objective of this resolution is the approval of the reports and consolidated accounts for the fi nancial year ending 31 December 2006)

Agenda of the Mixed General Assembly of Altran Technologies 29 June 2007


Appendix 2


The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, having read the management report by the Management Board and the general report by the statutory auditors on the consolidated accounts of the fi nancial year ending the 31 December 2006, having heard the observations of the Supervisory Board on these consolidated accounts and on the management report by the Management Board , approves all these consolidated accounts, that is, the balance sheet, the profi t and loss account and the appendix drawn up on the December, as they have been presented, as well as the operations shown in these accounts and resumed in these reports.

Resolution three(The objective of this resolution is to rule on the allocation of the results of for the fi nancial year ending 31 December 2006)

The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, having read the management report by the Management Board and the general report by the statutory auditors on the corporate accounts of the fi nancial year ending the 31 December 2006, having heard the observations of the Supervisory Board on these corporate accounts and on the management report by the Management Board , approves all these corporate accounts, that is, the balance sheet, the profi t and loss account and the appendix drawn up on the 31 December 2007 , as they have been presented, as well as the operations shown in these accounts and resumed in these reports.

In accordance with the law, the General Assembly observes that there has been no distribution of dividends during the previous three fi nancial years.

Resolution four(The objective of this resolution is to approve the regulated agreements concluded by the Company and presented in the special report by the statutory auditors)

The General Assembly, ruling under the required quorum and majority conditions for Ordinary General Assemblies, having read the special report by the statutory auditors as stated in article L. 225-88 of the Code of Commerce on the agreements described in articles L. 225-88 and following of the Code of Commerce and ruling on this report, approves the agreements described in it in all parts..

Resolution five(The objective of this resolution is to authorise the Management Board to carry out the purchase by the Company of its own shares)

The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, having read the report by the Management Board :

with immediate effect for the unused fraction puts an end to the authorisation for the company Altran Technologies to pay its own shares in application of articles L. 225-209 and following of the

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Code of Commerce, given to the Company by the Mixed General Assembly of 8 June 2006;

authorise the Management Board , in the conditions defi ned in Article 14.1 of the articles of association, to buy, in one or more occasions, the shares of the Company, in accordance with the provisions of articles L. 225-209 and following of the Code of Commerce, up to a limit of fi ve percent (5%) of the issued capital.

It is stated that this limit of fi ve percent (5%) applies to a sum of the capital of the Company and shall be, where applicable, adjusted to take into consideration the operations affecting the social capital after the present General Assembly, the cumulative commitments made by the Company in no case being able to lead it to hold more than fi ve percent (5%) of the issued capital.

The acquisition, cession and transfer of these shares may take place at any time (including during takeover bid periods) any by any means, particularly on the market or by mutual agreement, including by the acquisition or cession of blocks, the use of derivative fi nancial instruments, or any optional operations.

The maximum purchase price is fi xed at twenty (20) euros and the minimum selling price at fi ve (5) euros. In the case of operations on capital, particularly capital increase by incorporation of reserves and allocation of free shares, or in the case of division or regrouping of securities, the prices indicated above will be adjusted by a multiplication factor equal to the ratio between the number of securities making up the capital before the operation and this number after the operation. Consequently, the maximum sum to be used for the purchase programme reaches one hundred and seventeen million four hundred thousand (117,400,000) euros, as calculated based on the issued capital on 31 December 2006, and this maximum sum may be adjusted to take into account the amount of capital on the day of the General Assembly.

The maximum share of capital which can be purchased may not exceed fi ve percent (5%) of the issued capital.

The acquisitions of shares may be carried out with a view to any allocation permitted by the law, the objectives of the share purchase programme being:

depending on market conditions, to regulate the stock market price of the shares of the Company by systematically working to reverse tendencies;

to allocate securities within the scope of the participation of employees in the results of the expansion of the company or in a company or group savings plan, a free share allocation plan or even a voluntary employee partnership savings plan;

to transfer the securities as payment or exchange, particularly within the scope of external growth operations or a fi nancial and asset management policy;

to hand over the shares on the occasion of exercising rights attached to securities which give entitlement, through reimbursement, conversion, exchange, presentation of a bond or in any other way, to the allocation of Company shares;

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Appendix 2

their cancellation, notably, for the purposes of improving the result per share, within the framework of resolution 9 submitted to the present mixed General Assembly.

The Assembly also authorises the Management Board , depending on the market conditions, in order to regulate the stock exchange price, to acquire the share of the Company up to a limit of zero point fi ve percent (0.5%) of the capital of the Company. In this scenario, the Company would be exempted from drawing up a takeover bid notice to be submitted for approval to the Financial Markets Authority. The Company must however release a communiqué containing all the information normally contained in the takeover bid notice no later than the day of the effective launch of the programme.

This authorisation will expire at the end of the General Assembly called to ru le on the accounts for the fi nancial year ending the 31 December 2007.

The Management Board shall inform the shareholders, during the Annual General Assembly, of the purchases, transfers, cessions and cancellations of shares carried out in this way.

To this effect, all powers are conferred to the Management Board to decide to implement the present authorisation and to determine the procedures for this, which would allow them, in order to pass all the stock exchange orders, to conclude any possible agreements, particularly on holding registers of buying and selling of shares, to draw up all documents particularly notices, to make any declarations to the Financial Markets Authority and any other organisations, to complete all formalities and generally, do everything necessary.

Resolution six(The objective of this resolution is to authorise the Management Board to issue obligations and other similar securities or other securities conferring the same debt rights over the Company)

The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, having read the report by the Management Board :

authorises the Management Board to issue, on one or more occasions, solely through its own deliberations, in France, abroad and/or on the international market by public offering for savings or private investment, where applicable through a Euro Medium-Term Notes (EMTN) programme, on the dates and in the conditions it judges appropriate and within twenty-six (26) months from the date of the present Assembly, the obligations or similar securities, particularly subordinated securities, for a determined or undetermined duration, or any other securities conferring in a same issuance a same debt right on the Company, and accompanied or not by bonds giving entitlements to the allocation, acquisition or subscription of obligations, similar securities or other securities conferring such a debt right over the Company.

The General Assembly decides that the maximum par value for which all the aforementioned securities to be issued may be made out cannot exceed two hundred and fi fty (250) million euros, or the exchange value, on the date of the decision to issue them, of foreign currencies

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to the Euro, or in any other monetary units established with reference to several currencies, provided that this maximum amount applies to all obligations or similar securities and to all the other debt securities issued immediately or after the exercise of bonds, but that this same fi gure does not include redemption premiums, if planned. The debt securities which are negotiable in the sense of articles L. 213-1 to L. 213-4 of the Monetary and Finance Code are not covered by the present authorisation.

The Assembly confers all powers to the Management Board , with the facility to sub delegate under the conditions stated in the law, for the purpose of:

issuing these securities within the limitations fi xed above, by determining the date, nature, amounts and currency of issuing;

deciding on the characteristics of the securities to be issued, and particularly their par value and their vesting date, their issue price, where applicable with premium, their interest rate, fi xed and/or variable or zero coupon, and payment date or, for variable rate securities, the procedures for determining their interest rate, or even the conditions for capitalisation of interest;

fi xing, depending on the market conditions, the procedures for amortisation and/or early redemption of the securities issued, where applicable, with a fi xed or variable premium, or even of repurchase by the Company

if necessary, deciding to confer a guarantee or safeguards on the securities to be issued, and to determine the nature and characteristics of these;

anticipating, where applicable, the redemption of the securities issued through a transfer of assets of the Company;

generally, setting all the modalities for each issuance, make all conventions, conclude all agreements with all banks and organisations, take all measures and accomplish all formalities required, and generally, do everything necessary.

The present authorisation is granted, subject, for the cases listed in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

Resolution seven(The objective of this resolution is ratifi cation of the co-opting of a member of the Supervisory Board)

The General Assembly ruling under the quorum and majority conditions required for Ordinary General Assemblies decides to ratify the co-option to the position of member of the Supervisory Board Mr Jacques-Etienne de T’Serclaes, decided by the Supervisory Board on the 5 March 2007.

Monsieur Jacques-Étienne de T’Serclaes will exercise his mandate until the end of the Ordinary General Assembly which will be called to rule on the accounts for the fi nancial year to close on the 31 December 2008.

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Appendix 2


Resolution eight(Powers to accomplish formalities)

The General Assembly, ruling under the quorum and majority conditions required for Ordinary General Assemblies, grants all powers to the bearer of an original, copy or extract of the minutes of the present assembly, to accomplish all legal or administrative formalities and to carry out all registrations and publicity required by the legislation in force.

Resolutions falling under the competence of the Extraordinary General Assembly

Resolution nine(Authorisation to be given to the Management Board to reduce the issued capital through the cancellation of shares)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board and the special report by the statutory auditors as stated in Article 14.1 of the articles of association, authorises the Management Board in accordance with article L. 225-209 of the Code of Commerce, to cancel, by its own decision, on one or more occasion, in a period of twenty-four (24) months from the present Assembly within the maximum limit of ten percent (10%) of the total capital, subject to cancellations already made, the shares acquired by the Company or which it may acquire and accordingly to carry out an issued capital reduction.

The General Assembly confers all powers to the Management Board , with the facility to sub delegate, for the purpose of completing all actions, formalities or statements in order to make defi nitive the reductions of capital with may be carried out by virtue of the present authorisation and for the purposes of modifying the articles of association of the Company.

This authorisation is given for a period of twenty-four (24) months from the date of the present Assembly. It cancels and replaces the authorisation given by the mixed General Assembly of Shareholders of 8 June 2006.

Resolution ten(The objective of this resolution is to delegate competence to the Management Board for the purpose of increasing the issued capital by issuing shares and securities giving immediate or long-term access to the capital of the Company, maintaining the preferential subscription right)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board and the special report by the

statutory auditors and in accordance with the provisions of the Code of Commerce and particularly those of articles L. 225-129-2 and L. 228-92:

delegates to the Management Board , for a period of twenty-six (26) months from the date of the present Assembly, the competence to carry out, by its own deliberations, on one or more occasions, in the proportions and at the time it wishes, both in France and abroad, the issuing in euros or another currency, maintaining preferential subscription rights, shares of the Company, or any securities of any nature – including bonds for subscription of new shares (and/or where applicable allocation of existing shares) issued autonomously – giving access, immediately or in the long term, at any time or on a fi xed date, to shares in the Company, with or without premiums;

decides that the maximum par value of issued capital increases likely to be realised immediately or in the long term by virtue of the present delegation of powers, cannot be greater than fi fteen (15) million euros, a fi gure to which is to be added, where applicable, the par value of additional shares to be issued to preserve the rights of holders of securities giving rights to shares in accordance with the applicable legal and regulatory provisions and, where applicable, with contractual stipulations requiring other adjustments;

decides, in addition, that the maximum par value of securities representing debts giving access to the capital of the Company which may be issued by virtue of the present delegation of powers, cannot be greater than two hundred and fi fty (250 ) million euros or the exchange value if issued in another currency, provided that (i) this fi gure is independent of the value of obligations and other debt securities which may be issued in application of resolution 6 of the present Assembly and (ii) the value of capital increases which may be realised by virtue of the issuing these securities representing debts shall be imputed on the aforementioned the maximum fi gure of fi fteen (15) million euros;

decides that in the case of an invitation to subscribe, the shareholders will benefi t from a pre-emptive preferential subscription right, in the conditions stated by the law, for the securities which may be issued by virtue of the delegation. In addition, the Management Board shall have the facility to confer to the shareholders, in the conditions stipulated by the law, the right to subscribe to a higher number of excess shares than they could subscribe to pre-emptively, proportionally to the subscription rights they have, and in any case, up to the limit of their request;

decides that if pre-emptive subscriptions, and where applicable, subscriptions for excess securities, have not absorbed all the shares or securities issued as defi ned above, the Management Board may use, in the order it considers appropriate, one or other of the facilities below:

limiting, where applicable, the number of securities issued to the number of applications received, on the condition that this reaches at least three-quarters of the desired issuance,

distributing freely all or some of the securities not subscribed pre-emptively and, where applicable, subscriptions for excess shares,

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Appendix 2

offering to the public, on the French or international market, all or some of the non-subscribed securities;

decide that subscription bonds for new shares (and/or where applicable, allocation of existing shares) of the Company in application of article L. 228-95 of the Code of Commerce may be issued either by an offer of subscription in the conditions described above, or by free allocation to the owners of former shares.

In the case of free allocation of bonds for subscription to new shares (and/or where applicable, allocation of existing shares), the Management Board may decide that fractional allocation rights will not be negotiable and that the corresponding bonds will be sold, the sums resulting from the sale being allocated to the holders of rights no more than thirty (30) days after the date the entire number of bonds allocated is registered on their account:

observes that the aforementioned authorisation lawfully allows, in favour of the holders of securities giving access in the long term to shares of the Company which may be issued by virtue of the present authorisation, waiver by the shareholders of their preferential right to subscription to the shares to which these securities give entitlements;

decides that the sum which results or which should result for the Company for each of the shares issued within the scope of the aforementioned delegation, shall be at least equal to the par value of the shares;

confers all powers to the Management Board , with the facility to sub delegate to its Chair, and/or one of its members with the agreement of the Chair, under the conditions stated by the law, to implement the present authorisation, notably for the purpose of:

determining the dates and procedures for issuing securities and the form and characteristics of the securities to be created,

deciding on the price and conditions for issuing the securities, fi xing the quantities to be issued and the vesting date, even if retroactive, of the securities to be issued, determining the method of paying up the shares or other securities issued and, where applicable, anticipating the possibility of suspension of the exercise of allocation rights for shares attached to securities to be issued for a period which cannot exceed three months, setting the procedures by which, where applicable, the rights of holders of securities giving long term access to the issued capital are preserved. In addition, the Management Board or, if delegated, its Chair and/or one of its members may, where applicable, make charges on the share premium(s) and particularly costs incurred through issuing, and generally take all useful measures and conclude all agreements in order to successfully complete the issuances planned, carry out all formalities required to be admitted to negotiations on a regulated market in France or another country with respect the rights, shares, securities or bonds and where applicable to determine their procedures for exercising, allocating, purchasing, offering, exchanging

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or redeeming the securities, noting any capital increases resulting from their issue carried out through the use of the present delegation and modify the articles of association accordingly.

If debt securities which give immediate or long term access to part of the capital of the Company are issued, the Management Board shall have all powers, with the facility to sub-delegate to the Chair and/or one of its members, particularly to decide whether they are subordinated or no, to set their interest rate, their term, the fi xed or variable redemption value, with or without premium, the modalities for amortisation based on the market conditions and the conditions in which these securities shall give entitlement to Company shares;

decides that the present delegation makes null and void any former delegation relating to immediate or long terms issuing of shares in the Company, maintaining the preferential subscription right.

The authorisations and delegations described in the present resolution are granted, subject, for the cases listed in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

Resolution Eleven(The objective of this resolution is the delegation of competence to the Management Board for the purpose of increasing the issued capital by issuing shares and securities giving immediate or long-term access to the capital of the Company, withdrawing the preferential subscription right)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board and the special report by the statutory auditors, and in accordance with the provisions of articles L. 225-129-2 and L. 225-135 of the Code of Commerce:

grants to the Management Board , the competence to issue, by its own deliberations, on one or more occasions, via public investment offering, in the proportions and at the time it wishes, both in France and abroad, in euros or another currency, maintaining preferential subscription rights, shares in the Company, or securities of any nature – including bonds for subscription of new shares (and/or where applicable allocation of existing shares) issued autonomously – giving access, immediately or in the long term, at any time or on a fi xed date, to shares in the Company, with or without premiums;

decides that the maximum par value of issued capital increases which may to be realised immediately and/or in the long term by virtue of the present delegation of powers, cannot be greater than fi fteen (15) million euros, a fi gure to which will be added, where applicable, the par value of additional shares to be issued to preserve the entitlements of holders of securities giving entitlement to shares;

decides that the maximum par value of this sum which may be issued by virtue of the present resolution shall be imputed on the maximum ceiling of capital increases of fi fteen (15 ) million euros set in Resolution 10;

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Appendix 2


decides, in addition, that the maximum par value of securities representing debts giving access to the capital of the Company which may be issued by virtue of the present delegation of powers, cannot be greater than two hundred and fi fty (250 ) million euros or the exchange value if issued in another currency, provided that (i) this fi gure is independent of the value of obligations and other debt securities which may be issued in application of resolution 6 of the present Assembly and (ii) the value of capital increases which may be realised by virtue of the these issuances of securities representing debts shall be imputed on the aforementioned maximum fi gure of fi fteen (15) million euros stated in Resolution 10;

decides to withdraw the preferential subscription right of shareholders to the securities to be issued, it being understood that the Management Board may confer to the shareholders a priority subscription facility for all or some of the securities issued, within the time period and in the conditions it determines. This priority right, which is non-negotiable, shall be exercised in proportion to the number of shares owned by each shareholder. This subscription period does not lead to the creation of negotiable rights;

observes that the aforementioned authorisation lawfully allows the waiver, in favour of the holders of securities giving access in the long term to shares of the Company which may be issued, by the shareholders of their preferential right to subscription to the shares to which these securities give entitlements;

decides to withdraw the preferential subscription right of the shareholders to shares issued by conversion of obligations or by exercise of share subscription bonds issued autonomously;

decides that the sum which results or which should result for the Company for each of the shares issued or to be issued within the scope of the aforementioned authorisation, after taking into account, in the case of issuing autonomous share subscription bonds, the issue price of these bonds, shall be at least equal to the minimum value fi xed by the law which applies at the time when the present authorisation is used, or currently the average spread over the last three stock exchange sessions before it is set, on the Euronext First Market in Paris, possibly reduced by a maximum discount of fi ve percent (5%) in accordance with the decree of February 2005 (Article 156 modifi ed of the decree of 1967) concerning the order of June 2004;

decides that the Management Board may use the present delegation, in all or part, for the purpose of remunerating all securities contributed to a public exchange offering initiated by the Company on the securities of the Company or another company, up to the limits and other conditions stipulated by the law in force at the time when the present resolution is used;

confers all powers to the Management Board , with the facility to sub delegate, under the conditions stated in the law in force at the time of use of the authorisation, to implement the present delegation, notably for the purpose of determining the dates and procedures for issuing the securities and their form and characteristics deciding on the price and conditions for issuing the securities, fi xing the quantities to be issued, the vesting date, even if retroactive, of the securities to be issued, determining the method of paying up the

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shares or other securities issued and, where applicable, anticipating the possibility of suspension of the exercise of allocation rights for shares attached to securities to be issued for a period which cannot exceed three months, fi xing the procedures according to which, where applicable, the rights of holders of securities giving long term access to the issued capital are preserved.

In addition, the Management Board or, if delegated, its Chair and/or one of its members may, where applicable, make charges on the share premium(s) and particularly, costs incurred through issuing, and generally take all useful measures and conclude all agreements in order to successfully complete the issuances planned, carry out all formalities required to be admitted to negotiations on a regulated market in France or another country with respect to the rights, shares, securities or bonds and where applicable determine the procedures for exercising, allocation, purchasing, offering, exchange or redemption, noting any capital increases resulting from any issuance completed through the use of the present delegation and modify the articles of association accordingly.

If debt securities which give immediate or long term access to part of the capital of the Company are issued, the Management Board shall have all powers, with the facility to sub-delegate in accordance with the regulations in force, particularly, to decide whether they are subordinated or no, to set their interest rate, their term, the fi xed or variable redemption price, with or without premium, the modalities for amortisation depending on the market conditions and the conditions in which these securities shall give entitlement to Company shares;

decides that the present delegation makes null and void any previous delegation relating to the immediate or long term issuing of shares in the Company, withdrawing the preferential subscription right and facility to confer a priority right.

The present authorisations and delegations thus granted to the Management Board are valid, from the date of the present Assembly, for a duration of twenty-six (26) months, subject, for the cases listed in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

Resolution Twelve(The objective of this resolution is to delegate to the Management Board the competence to increase the issued capital by incorporating reserves, profi ts, premiums or others)

The General Assembly, ruling under the required quorum and majority conditions for Ordinary General Assemblies in application of the provisions of article L. 225-129-2 of the Code of Commerce, having read the report by the Management Board , delegates to the Management Board the authority to decide to increase the issued capital, on one or more occasions, at the time or times it decides, in the proportions it judges appropriate, for a duration of twenty-six (26) months from this date, through the issuing of new ordinary shares to be paid up by the incorporation of reserves, profi ts or premiums or by increasing the par value of the shares making up the issued capital or by the simultaneous use of these two procedures.

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Appendix 2

The maximum par value of issued capital increases which may be carried out by virtue of the present delegation cannot exceed fi fteen (15) million euros, and this maximum value is imputed on the maximum limit of the capital increases which may be carried out by virtue of Resolution 10 of the present Assembly.

The General Assembly confers all powers to the Management Board , with the facility to sub delegate to its Chair, and/or one of its members with the agreement of the Chair, under the conditions stated in the law, to implement the present authorisation, notably for the purpose of:

fi xing the modalities, conditions and dates of capital increases which may be made by virtue of the present authorisation, and particularly fi xing the sum and nature of the reserves and premiums to be incorporated into the capital, fi xing the number of new shares to be issued or the mount by which the par value of the existing shares making up the issued capital is to be increased, setting the date, even if retroactive, from which the new shares will be enjoyed, or that on which the increased par value will take effect, taking all measures aimed at protecting the rights of holders of securities which give entitlement to existing shares of the Company on the day of the capital increase and make any charges on the share premiums, and particularly any expenses caused by issuing the shares;

deciding that, contrary to article L. 225-14 of the Code of Commerce, in cases of capital increase through allocation of free shares, the fractional allocation rights will not be negotiable and the corresponding shares will be sold and the net product of their sale will be allocated to the holders of these rights, proportionally to these rights, no more than thirty days after the entire number of new shares allocated is registered in their account;

taking all useful measures and concluding all agreements to ensure all operations planned are completed correctly and, generally, doing everything necessary, completing all acts and formalities in order to make defi nitive the capital increases(s) which may be carried out by virtue of the present delegation and to make the corresponding modifi cations to the articles of association.

The General Assembly decides that the present delegation makes null and void any previous delegation relating to capital increase by the incorporation of reserves, profi ts, premiums or other sums, by which capitalisation is accepted, and particularly that granted by the Mixed General Assembly of 29 June 2005. It is also granted subject, for the cases described in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

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Resolution thirteen(The objective of this resolution is to authorise the Management Board to increase the number of securities to be issued if an increase in issued capital is required with or without preferential subscription rights in application of resolutions 10, 11 and 12)

The General Assembly, ruling under the required quorum and majority conditions for Ordinary General Assemblies, having read the report by Management Board and the special report by the statutory auditors, authorises the Management Board , if it observes an excessive demand for subscriptions during an increase in issued capital in application of resolutions 10, 11 and 12 of the present Assembly, to increase the number of securities in accordance with the provisions of Article 225-131-1 of the Code of Commerce, within thirty days from the close of subscriptions, up to the limit of fi fteen percent (15%) of the initial amount issued and at the same price as set initially.

The present delegation is granted for a duration of twenty-six (26) months, from the date of the present Assembly, subject, for the cases listed in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

Resolution fourteen(The objective of this resolution is to delegate to the Management Board the powers necessary for the purpose of issuing shares or any kind of security up to a limit of 10% of the issued capital, with a view to remunerating contributions in kind, capital stock or securities giving access to the capital of third party companies)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board as stated in article L. 225-147 of the articles of association, delegates to the Management Board the powers necessary to carry out a capital increase up to a limit of ten percent (10%) of the issued capital, by issuing ordinary shares and any other securities giving access to the capital of the Company, with a view to remunerating contributions in kind granted to the Company and made up of capital shares or securities giving access to the capital of third party companies, when the provisions of the articles L. 225-148 of the Code of Commerce do not apply:

decides that the par value of the issued capital increase of the Company resulting from the issuing of the securities defi ned in paragraph above may not exceed ten (10) million euros;

decides to set the duration of the present delegation for twenty-six (26) months from the date of the present Assembly;

confers all powers to the Management Board , with the facility to sub delegate to its Chair, and/or one of its members with the agreement of the Chair, to issue these securities following the procedures it chooses, and particularly:

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Appendix 2


to determine the nature and number of ordinary shares and securities to be created, their characteristics and the procedures for issuing them,

to approve the valuation of the contributions,

to charge all costs, charges and duties for the capital increase on the related premiums and deduct from this amount the sums required to bring the legal reserve to one tenth of the new issued capital after each increase, any allocation decided by the Management Board or by the Ordinary General Assembly may be allocated to this,

to modify the articles of association.

The General Assembly states that in compliance with the Law, the Management Board , if it makes use of the present delegation, shall rule on the report of one or more auditors as mentioned in article L. 245-147 of the Code of Commerce.

The present authorisations and delegations are granted, subject, for the cases listed in Article 14.1 of the articles of association, to the prior agreement of the Supervisory Board.

Resolution fifteen(The objective of this resolution is to authorise the Management Board to carry out issued capital increases, by issuing shares or other securities which give access to the capital, reserved for subscribers to a savings plan)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board and the special report by the statutory auditors and in accordance with the provisions of articles L. 225-129-2 and L. 225-129-6 of the Code of Commerce and within the scope of the provisions of articles L. 225-138-I of this same Code and L. 443-1 and following of the Labour Code:

authorises the Management Board to increase the issued capital on one or more occasion, by its own decision, by a maximum par value of one million two hundred thousand (1,200,000) euros, within a period of twenty-six (26) months from the date of the present Assembly, though issuing new shares or other securities giving access to the capital of the Company, reserved for subscribers to a Company savings plan and French or foreign companies linked to it under the conditions of article L. 225-180 of the Code of Commerce and L. 444-3 of the Labour Code;

decides to withdraw, in favour of subscribers to a savings plan, the preferential right of shareholders to subscribe to new shares or other securities giving access to the issued capital in application of the present resolution;

decides, in application of the provisions of article L. 443-5 of the Labour Code, to set the discount at twenty percent (20%) (or thirty percent (30%), if required by the law), in relation to the average of the fi rst prices quoted for the Company share on Euronext Paris S.A. during the twenty Stock Exchange session prior to the

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day of the decision setting the opening date for subscriptions. However, the General Assembly expressly authorises the Board of Directors to eliminate or reduce the aforementioned discount, if it judges it appropriate, specifi cally to limit the discount granted to fi fteen percent (15%) of the price quoted for the Company share registered on the day of the decision setting the opening date for subscriptions, within the legal and regulatory limits, in order to take into consideration, inter alia, legal, accounting, tax and company schemes applicable locally. The Board of Directors may also substitute all or part of the discount with the allocation of shares or other securities in application of the provisions below;

decides that the Management Board may consider the free allocation of shares or other securities giving access to the capital of the Company, provided that (i) the total benefi t resulting from this allocation through employer contribution to the employee savings scheme or, where applicable, the discount on the subscription price may not exceed the legal or regulatory limits and (ii) that the shareholders of the Company waive any right to the shares or other securities giving access to the capital which shall be issued by virtue of the present resolution; and

decides that the characteristics of the other securities giving access to the capital of the Company shall be determined by the Management Board in the conditions set by the regulations.

The Management Board shall have all powers, with the facility to sub delegate to its Chair, and/or one of its members with the agreement of the Chair, to implement the present authorisation and particularly, to set the procedures and conditions for issuing these securities by virtue of the present authorisation, set the amount to be offered for subscription and the opening and closing dates for subscription, the price, the vesting dates of the securities issued, the procedures and deadlines for paying up the securities and where applicable, to request their acceptance to be quoted on the stock exchange anywhere this is indicated, record the completion of capital increases up to the value of the shares which will effectively be subscribed, complete, directly or through a representative, all operations and formalities linked to capital increases, make necessary modifi cations to the articles of decision, and by its own decision and if judged appropriate, charge the costs for capital increases to the premiums related to these issuances and deduct from this amount the sums required to bring the legal reserve to one tenth of the new capital after each increase, to carry out, where applicable, all the formalities necessary for the quotation of the securities issued in this way, make the declarations required to all organisations and do anything else required.

Decides that the present delegation makes null and void any prior delegation relating to capital increases reserved for subscribers to company savings plans and particularly that granted by the Mixed General Assembly of 29 June 2005.


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Resolution Sixteen(The objective of this resolution is to delegate to the Management Board the competence to decide to issue OBSARs)

The General Assembly, ruling under the required quorum and majority conditions for Extraordinary General Assemblies, having read the report by the Management Board and the special report by the statutory auditors and in accordance with the provisions of articles L. 228-91 and following, L. 225-129 and following and L. 225-138 of the Code of Commerce:

1) delegates to the Management Board , with the facility to sub delegate under the legal and regulatory conditions, the competence to decide to increase the issued capital by issuing, on one or more occasion, obligations, each one being linked to one or more bonds with redeemable subscription and/or acquisition of share warrants (the “OBSARs” and the “BSARs”) which may be redeemed during a period of seven (7) years after issuing;

2) decides, in accordance with the provisions of article L. 225-138 of the Code of Commerce, to withdraw the preferential subscription right of shareholders to OBSARs and to reserve the right to subscribe to these shares to one or more entities, a defi nitive list of which the Management Board shall draw up within the category of legal entities, which, on the date the present delegation is implemented by the Management Board :

are authorised by the competent authorities or by any other equivalent authorisation to provide investment services in France, and

have been, during the twenty-four (24) months prior to the date of the present General Assembly, lead manager or subscriber to issuing obligations linked to one or one or more bonds with redeemable subscription and/or acquisition of share warrants issued by a company of which the shares are accepted for negotiations on the Eurolist market of Euronext Paris, and

of which the latest approved and published annual accounts, or the latest half-yearly audited and published accounts, show a balance sheet total greater than 250 billion euros or which are controlled by, control, or of which the accounts are included in the scope of consolidation of a French or foreign entity of which the latest annual approved and published accounts or the latest audited and published half-yearly accounts show a balance sheet total greater than 250 billion euros, and/or

fall under Chapter II of the fi rst Title of the fi fth Book of the monetary and fi nancial code, governing mutualist banks or cooperatives, and of which the latest approved and published annual accounts or the latest half-yearly audited and published accounts, show a balance sheet total greater than 250 billion euros, or which are controlled by, control, or of which the accounts are included in the scope of consolidation of a French or foreign entity of which the latest annual approved and published accounts or the latest audited and published half-yearly accounts show a balance sheet total greater than 250 billion euros;

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3) decides that the maximum par value of issued capital increases likely to be realised in the long term by virtue of the present delegation of powers, cannot be greater than fi fteen (15) million euros, a fi gure to which will be added, where applicable, the par value of additional shares which must be issued for adjustments which may be made in accordance with the applicable legislative and regulatory provisions and, where applicable, contractual stipulations envisaging other cases of adjustment, to preserve the rights of the holders of securities giving access to the capital of the Company; the value of capital increases carried out by virtue of the present resolution shall be charged on the maximum par value of capital increases which may be carried out by virtue of resolutions 10 and 11 as proposed to the present mixed General Assembly of Shareholders and on the assumption that they are adopted by the present Assembly;

4) decides that the maximum par value of OBSAR s which are to issued by virtue of the present resolution shall be 250 million euros, this fi gure not being charged on, and being autonomous and separate from, the maximum par value given for securities representing debt securities giving access to the capital, as in resolutions 10 and 11 proposed to the present General Assembly of Shareholders, and from the maximum par value given in resolution six of the present General Assembly on the assumption that these resolution are adopted;

5) observes that the decision to issue OBSARs leads automatically to a waiver by the shareholders of their preferential subscription right to the shares issued through the use of BSARs, in favour of the holders of these BSARs, in accordance with article L. 225-132, last paragraph, of the Code of Commerce;

6) decides that the subscription or acquisition price of each new share of the Company through the use of BSARs shall be set by the Management Board in such a way that it is equal to more than 125% and less than 150% of the average price of the company share spread over the volumes during the three (3) stock market sessions immediately prior to the date of the decision of the Management Board to issue OBSARs by virtue of the present delegation (the “average price”);

7) decides that the unitary par value for issuing OBSARs shall be determined by the Management Board ;

8) takes cognizance that:

the BSARs attached to each obligation issued by virtue of the present delegation shall be immediately detachable from this obligation from the time of subscription of the OBSAR,

the BSARs shall be transferred by the credit establishments which have subscribed the OBSARs directly or indirectly to (a) employees or corporate offi cers of the Company and/or any French or foreign subsidiary of which it holds control in the sense of article L. 233-3 of the Code of Commerce and/or to (b) authorised investors,

the Company may, in certain circumstances, including immediately after issuing the OBSARs, repurchase the BSARs in order to cancel them,

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Appendix 2


the OBSARs will be issued in a nominative form,

The OBSARs and BSARs may be admitted for negotiation on a regulated market immediately or in the long term,

the BSARs may be temporarily non-transferable and unusable and may be redeemed early at the will of the Company ;

9) confers all powers to the Management Board , with the facility to sub delegate under the legal and regulatory conditions, for the purpose of:

deciding at the time it considers appropriate, to issue OBSARs in accordance with the present resolution,

setting, within the category described in point 2 of the present resolution, the list of entity(ies) to whom the OBSARs issued by virtue of the present resolution shall be reserved, and the number of OBSARs which will be reserved for each of them,

determining, in respect of the aforementioned provisions, the characteristics of and procedures for issuing the OBSARs, and the characteristics and procedures for BSARs, and particularly the subscription price of shares resulting from the use of BSARs in accordance with point 6 of the present resolution, as well as the vesting date of these shares,

drawing up the issue contract for the OBSARs,

agreeing with the credit establishments which are the benefi ciaries of the OBSARs the unitary transfer price of the BSARs according to the characteristics of each BSAR,

recording the completion of capital increases which result from the use of BSARs, and modifying the articles of association in accordance,

modifying, in the future, where applicable and subject to the agreement of the holders of OBSARs where required, the issue contract for the OBSARs;

taking all measures, concluding all agreements and completing all formalities to issue the OBSARs as decided;

10) the powers delegated to the Management Board in this way are valid for a duration of eighteen (18) months from the date of the present General Assembly.


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Resolution Seventeen(The objective of this resolution is to completely rewrite Article 20 of the articles of association of your Company in order to make it comply with the decree of 11 December 2006, modifying the decree of 23 March 1967 on commercial companies)

The General Assembly, ruling under the required quorum and majority conditions for Ordinary General Assemblies, having read the report by the Management Board , decides to completely rewrite Article 20 of the articles of association, in order to make it comply with the provisions of the decree of 11 December 2006, modifying the decree of 23 March 1967 on commercial companies.

The General Assembly, ruling under the quorum and majority conditions required for Extraordinary General Assemblies decides, as a consequence of the above, to adopt the following wording as the new wording of articles 20 of the articles of association:

Article 20 – Shareholder AssembliesAssemblies of shareholders are convened and deliberate in the conditions stated by the Law.

The meetings take place at the head offi ce of the company or at another location specifi ed in the summons. The Management Board may decide when it convenes the assembly to publicly broadcast the entire meeting by videoconferencing or distance transmission, subject to the legal and regulatory provisions in force. Where applicable, this decision is included in the notifi cation of the meeting and the summons.

Two members of the Works Council, appointed by this council, may also attend General Assemblies. If they request it, they must be heard during all deliberations required unanimous approval by shareholders.

An intermediary who meets the obligations stated in the third and fourth paragraphs of article L. 228-1 of the Code of Commerce may, by virtue of a general mandate on management of securities, represent in an assembly the vote or proxy of a share owner as defi ned in the third paragraph of the same article.

Before representing proxies or votes to the general assembly, the intermediary is bound, on the request of the company issuing the securities or its representative, to provide the list of non-resident share owners to which these voting rights are attached. This list is provided in the conditions provided by the regulations in force.

The vote or proxy issued by an intermediary who either is not declared as such, or does not reveal the identity of the shareowners cannot be taken into account.

General Assemblies are composed of all shareholders, whatever the number of shares they own, provided they have made compulsory payments.

Any shareholder may participate, personally or by proxy, in Assemblies on providing proof of identity and of share ownership.


Appendix 2

The right to participate in Assemblies is subject to respect for the regulatory and legislative texts in force.

Any shareholder may vote by post using a form which may be obtained in the conditions shown in the summons to the Assembly. During General Assemblies, the quorum conditions stated by the Law based on the nature of Assemblies are evaluated in taking into account the number of shares with voting rights. In the case of postal votes, the only ones taken into consideration for calculating the quorum shall be those with forms duly completed and received by the Company at least three says before the date of the Assembly.

In the same way, any written question addressed to the Management Board in accordance with article L. 225-108 of the Code of Commerce to be properly received by the Management Board must be sent to the latter by the legal deadlines. The majority conditions based on the nature of Assembly are evaluated in taking into account the number of voting rights attached to the shares owned by the shareholders present, represented or who have voted by post.

The shares belonging to any shareholder who has not met the legal obligation to inform the society as stated in article L. 233-7 of the Code of Commerce, shall lose his or her voting rights for the undeclared fraction, if requested, and recorded in the minutes of the General Assembly, by one or more shareholders holding at least 5% of the capital of the Company.

Assemblies are chaired by the Chair of the Supervisory Board, or in his or her absence, by the Deputy Chair, and otherwise, by a member of the Supervisory Board specially delegated for this purpose by the Board. If this is not possible, the Assembly elects its Chair itself.

If the Management Board decides at the time of convening the Assembly to publicly broadcast all of the Assembly by videoconference or by any means of telecommunication or distance transmission including the Internet this shall be authorised. Where applicable, this decision is included in the notifi cation of the meeting published in the Bulletin d’annonces légales obligatoires (“BALO” – French legal announcements journal).

Any shareholder may also, if the Management Board decides at the time of convening the Assembly, take part in the Assembly by videoconference or by any means of telecommunication or distance transmission including the Internet in the conditions described by the regulations which apply at the time of its use. Where applicable, this decision is included in the notifi cation of the meeting published in the BALO.

The minutes of Assemblies are drawn up and their copies validly certifi ed by the Chair of the Supervisory Board or the Deputy Chair of the Supervisory Board or by the Secretary of the Assembly.

Resolution eighteen(Powers to accomplish formalities)

The General Assembly, voting under the quorum and majority conditions required for Extraordinary General Assemblies, grants full powers to the bearer of an original, a copy or an extract of the minutes of said assemblies to carry out any legal or administrative formalities, fi le any documents or make any declarations provided for by law.



STATUTORY AUDITORS’ REPORT

Statutory auditors’ report on the consolidated fi nancial statements

For the year ended 31 December 2006

This is a free translation into English of the Statutory Auditors’ report on the consolidated financial statements issued in French and is provided solely for the convenience of English speaking users. The Statutory Auditors’ report on the consolidated financial statements includes information specifically required by French law in such reports, whether modified or not. This information is presented below the opinion on the consolidated financial statements and includes an explanatory paragraph discussing the auditors’ assessments of certain significant accounting and auditing matters. These assessments were considered for the purpose of issuing an audit opinion on the consolidated financial statements taken as a whole and not to provide separate assurance on individual account captions or on information taken outside of the consolidated financial statements.

This report on the consolidated financial statements should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.

To the Shareholders,

In accordance with our appointment as statutory auditors by your Annual General Meeting, we have audited the accompanying consolidated fi nancial statements of Altran Technologies for the year ended 31 December 2006.

The consolidated fi nancial statements have been approved by the Management Board. Our role is to express an opinion on these fi nancial statements, based on our audit.

1. Opinion on the consolidated fi nancial statements

We conducted our audit in accordance with professional standards applicable in France. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated fi nancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also includes assessing the accounting principles used and the signifi cant estimates made by management, as well as evaluating the overall presentation of the fi nancial statements. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated fi nancial statements give a true and fair view of the assets and liabilities and of the fi nancial position of the Group as at 31 December 2006, and of the results of its operations for the year then ended in accordance with IFRSs as adopted by the European Union.

Without qualifying the above opinion, we would draw your attention to:

Note 6 to the fi nancial statements “Major litigation and contingent liabilities”;


2. Justifi cation of our assessments

Pursuant to the provisions of Article L.823-9 of the French Commercial Code (Code de commerce) governing the justifi cation of our assessments, we draw your attention to the following:

as indicated in Note 1.4 “Use of estimates”, the preparation of the fi nancial statements requires the use of estimates and assumptions. These estimates and assumptions are primarily used in the valuation of provisions and the preparation of business plans for the purposes of impairment tests on intangible assets and the recognition of deferred tax assets.

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Appendix 3


Appendix 3

Statutory auditors’ report

Our procedures consisted in assessing the reasonableness of the data and assumptions on which the estimates are based.

Notes 1.7 “Goodwill” and 7 “Off-balance sheet commitments” to the fi nancial statements describe the goodwill valuation policies and methods adopted and the corresponding impairment recognized in the fi nancial year, as well as the policies and methods applied to value amounts still payable under price “earn-out” clauses.

In accordance with the procedures set out in Note 1.7 to the fi nancial statements, the Company performs annual impairment tests on goodwill balances and intangible assets with an indefi nite life, as well as other long-term assets for which there is an indication of loss of value.

We examined the implementation of these impairment tests and the activity forecasts and assumptions used and verifi ed the inclusion of the appropriate disclosures in the note to the fi nancial statements.

Our procedures enabled us to assess the consistency of the estimates performed with the assumptions adopted.

Note 1.18 “Deferred tax” to the fi nancial statements describes the valuation policies and methods applied to deferred tax assets.

At each year-end, the Company systematically analyses the value of deferred tax assets and impairments recorded in accordance with the procedures set out in this note. We examined the implementation of these analysis procedures and the activity forecasts and assumptions used and verifi ed the inclusion of the appropriate disclosures in the note to the fi nancial statements.

Our procedures enabled us to assess the consistency of the estimates performed with the assumptions adopted.

- With regard to risks and litigation, we confi rmed the valuation methods and their recording in the accounts.

We also confi rmed that any identifi ed uncertainties relating to these risks and litigation are appropriately disclosed in Note 6 to the fi nancial statements, “Major litigation and contingent liabilities”.

These assessments were made in the context of our audit of the consolidated fi nancial statements taken as a whole, and therefore contributed to the opinion expressed in the fi rst part of this report.

3. Specifi c verifi cation

In accordance with professional standards applicable in France, we have also verifi ed the information provided in the Group’s management report.

We have no matters to report as to its fair presentation and its consistency with the consolidated fi nancial statements.

Courbevoie and Neuilly-sur-Seine, 25 May 2007

The Statutory Auditors

Mazars & Guérard

Jean-Luc Barlet Guy Isimat-Mirin

Deloitte & Associés

Henri Lejetté

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Appendix 3


Statutory auditors’ report on the fi nancial statements

For the year ended 31 December 2006

This is a free translation into English of the Statutory Auditors’ report on the financial statements issued in French and is provided solely for the convenience of English speaking users. The Statutory Auditors’ report on the financial statements includes information specifically required by French law in such reports, whether modified or not. This information is presented below the opinion on the financial statements and includes an explanatory paragraph discussing the auditors’ assessments of certain significant accounting and auditing matters. These assessments were considered for the purpose of issuing an audit opinion on the financial statements taken as a whole and not to provide separate assurance on individual account captions or on information taken outside of the financial statements.

This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.


In accordance with our appointment as statutory auditors by your Annual General Meeting, we hereby report to you for the year ended 31 December 2006 on:

the audit of the accompanying fi nancial statements of Altran Technologies,

the justifi cation of assessments,

and the specifi c procedures and disclosures required by law.

These fi nancial statements have been approved by the Management Board. Our role is to express an opinion on these fi nancial statements, based on our audit.

I. Opinion on the fi nancial statements

We conducted our audit in accordance with professional standards applicable in France. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also includes assessing the accounting principles used and signifi cant estimates made by management, as well as evaluating the overall fi nancial statement presentation.

We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the fi nancial statements give a true and fair view of the fi nancial position and the assets and liabilities of the Company as at 31 December 2006 and the results of its operations for the year then ended in accordance with French accounting regulations.

Without qualifying the above opinion, we would draw your attention to:

Note 5 to the fi nancial statements “Information on major ongoing litigation”;

Note 4.8 to the fi nancial statements on the accounting impact of merger operations during the fi nancial year;


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Appendix 3


II. Justifi cation of assessments

Pursuant to the provisions of Article L. 823-9 of the French Commercial Code (Code de commerce) governing the justifi cation of our assessments, we draw your attention to the following:

as indicated in Note 2.5 “Use of estimates”, the preparation of the fi nancial statements requires the use of estimates and assumptions. These estimates and assumptions are primarily used in the valuation of provisions and the preparation of business plans used to assess the value of investments.

Our procedures consisted in assessing the reasonableness of the data and assumptions on which the estimates are based.

With regard to risks and litigation, we confi rmed the valuation methods and their recording in the accounts.

We also confi rmed that any identifi ed uncertainties relating to these risks and litigation were appropriately disclosed in Note 5 to the fi nancial statements.

Such assessments were performed as part of our audit approach for the fi nancial statements taken as a whole, and contributed to the expression of our unqualifi ed opinion in the fi rst part of this report.

III. Specifi c verifi cations and disclosures

We have also performed the specifi c verifi cations required by law in accordance with professional standards applicable in France.

We have no matters to report regarding:

the fair presentation and the consistency with the fi nancial statements of the information provided in the management report of the Management Board, and in the documents addressed to the shareholders with respect to the fi nancial position and the fi nancial statements.

the fair presentation of the information provided in the management report in respect of remuneration and benefi ts granted to certain Company offi cers and any other commitments made in their favour in connection with, or subsequent to, their appointment, termination or change in function.

In accordance with the law, we verifi ed that information relating to the identity of holders of share capital and voting rights was disclosed in the management report.



Mazars & Guérard



Henri Lejetté

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Appendix 3


Statutory Auditors’ report on agreements and commitments involving members of the Management and Supervisory Boards of the Company

This is a free translation of the original text in French for information purposes only.

It should be understood that the agreements and commitments reported on are only those provided by the French Commercial Code and that the report does not apply to those related party transactions described in IAS 24 or other equivalent accounting standards.


In accordance with our appointment as statutory auditors of your Company, we hereby report on the agreements and commitments involving members of the Management and Supervisory Boards of the Company that have been brought to our attention. The terms of our engagement do not require us to identify such agreements and commitments, if any.

We hereby inform you that no agreement or commitment to which article L.225-86 of the French Commercial Code (Code de Commerce) would be applicable has been brought to our attention.



Mazars & Guérard



Henri Lejetté


Appendix 3


Statutory Auditors’ report prepared in accordance with the last paragraph of Article L.225-235 of the French Commercial Code (Code de Commerce) on the report prepared by the Chairman of the Supervisory Board of Altran Technologies with respect to the internal control procedures for the preparation and treatment of accounting and fi nancial information

This is a free translation into English of the Statutory Auditors’ report issued in the French language and is provided solely for the convenience of English speaking readers. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.


In our capacity as Statutory Auditors of Altran Technologies and in accordance with the last paragraph of Article L.225-235 of the French Commercial Code (Code de Commerce), we hereby report to you on the report prepared by the Chairman of the Supervisory Board of your Company in accordance with Article L.225-68 of the French Commercial Code for the year ended 31 December 2006.

In his report, the Chairman reports, in particular, on the conditions for the preparation and organization of the Supervisory Board’s work and the internal control procedures implemented by the Company.

It is our responsibility to report to you our observations on the information set out in the Chairman’s report on the internal control procedures relating to the preparation and treatment of fi nancial and accounting information.

We performed our procedures in accordance with professional guidelines applicable in France. These require us to perform procedures to assess the fairness of the information set out in the Chairman’s report on the internal control procedures relating to the preparation and treatment of fi nancial and accounting information. These procedures notably consisted of:

obtaining an understanding of the objectives and general organization of internal control, as well as the internal control procedures relating to the preparation and treatment of fi nancial and accounting information, as set out in the Chairman’s report;

obtaining an understanding of the work performed to support the information given in the report.

On the basis of these procedures, we have no matters to report in connection with the information given on the internal control procedures relating to the preparation and treatment of fi nancial and accounting information, contained in the Chairman of the Supervisory Board’s report, prepared in accordance with Article L.225-68 of the French Commercial Code, which presents in Section 2 the measures implemented to strengthen the Group’s internal control and accounting information systems.



Mazars & Guérard



Henri Lejetté

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Appendix 3


Statement of Statutory Auditors’ fees

(Euros, in thousands) Mazars Deloitte

Amount (net of VAT) As a % Amount (net of VAT) As a %

Years covered: 31/12/2005 and 31/12/2006 2005 2006 2005 2006 2005 2006 2005 2006

AuditStatutory auditor, certification, validation of corporate and consolidated year-end accounts(a) 2,328 2,176 95% 95% 2,276 2,222 93% 98%

Altran Technologies S.A a 1,089 1,149 791 1,077

Subsidiaries a 1,244 1,027 1,492 1,115Other duties and services directly related to the Statutory Auditor’s mission(b) 122 123 5% 5% 169 48 7% 2%

Altran Technologies S.Aa

Subsidiaries a 122 123 10

Sub-total (I) 2,450 2,299 100% 100% 2,445 2,270 100% 100%

Other services rendered for the subsidiaries

Legal, taxation, corporate(c)a 0 0

Other(d)a 0 0

Sub-total (II) 0 0 0% 0% 0 0 0% 0%

Total = (I) + (II) 2,450 2,299 100% 100% 2,445 2,270 100% 100%

(a) Audit services include all services invoiced by the Statutory Auditors for the audit of consolidated year-end financial statements and services provided by these auditors as required under legal or regulatory provisions or with regard to the Group’s commitments.They particularly include a review of the interim financial statements of the Company and its subsidiaries.

(b) Other services related to the Statutory Auditors’ mission and involving, for example, consultations on the matter of accounting standards applicable with regard to the publication of financial information and due diligence required with regard to acquisitions.

(c) Taxation consultations represent all services concerning compliance with taxation regulations and taxation advice provided with regard to actual or potential transactions, payroll processing for expatriated employees or the analysis of transfer prices.

(d) Other services include consulting provided on matters such as HR, cost-cutting measures and asset valuations for the purpose of disposals, in respect of the provisions of article 24 of the Code of Ethics.




4 Risk factors 8









13 Forecasts 38




17 Employees 58









Appendixes







4 Risk factors 8









13 Forecasts 38




17 Employees 58









Appendixes




Referencedocument

2006

ALTRAN TECHNOLOGIESS.A. à Directoire et Conseil de Surveillance

Capital : 58.658.118,50 euros

Headquarters58 boulevard Gouvion Saint-Cyr - 75017 PARIS

702 012 956 RCS Paris

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