Arcadis 2024-2026 Strategy: Accelerating a Planet Positive Future
Arcadis presents its 2024-2026
Strategy:Accelerating a Planet Positive
Future
- Arcadis presents its 2024-2026 strategy: Accelerating a Planet
Positive Future, with three strategic focus areas:
- Sustainable project choices
- Digital + human innovation
- Powered by our people
- Supported by strong tailwinds from climate change &
decarbonization, urbanism & social communities, evolving supply
chains and infrastructure investment
- Key strategic targets include:
- Mid to high single digit annualized net organic revenue
growth
- Operating EBITA margin of at least 12.5% in 2026
- Dividend pay-out ratio of 30 to 40% of Net Income from
Operations
- Scope 1 and 2 reduction of 70% GHG emissions by 2026 and Scope
3 reduction of 45% GHG emissions by 2029
- >40% women in the workforce
Amsterdam 16 November, 2023 –
Today Arcadis (EURONEXT: ARCAD), the
leading global Design & Consultancy organization for natural
and built assets, announced its 2024–2026
strategy: Accelerating a Planet Positive Future.
Alan Brookes, CEO Arcadis, said: “Over the last
three years, Arcadis has undergone a remarkable transformation,
successfully delivering our strategic objectives. We are now
excited to present our 2024-2026 strategy: Accelerating a Planet
Positive Future. This is supported by strong demand tailwinds and
focused on key growth markets and making deliberate choices towards
projects that align with our strategic ambitions and where we can
most effectively deploy our knowledge and innovative solutions. We
plan to further increase our successful Key Clients program and
will evolve our commercial models to reflect our changing role with
clients and further improve profitability. We have clear plans for
operational efficiencies by doubling the relative contribution of
our Global Excellence Centers in projects, tightening our business
pursuit criteria and processes, realizing synergies, and continuing
our successful standardization and automation program. In
delivering our strategic ambitions, our people are critical and we
will invest in a Skills Powered Organisation by continuing to grow
the skills of our people to address the client needs of the future.
This comprehensive approach gives me real confidence that we will
deliver on our strategy set out today, while Accelerating a Planet
Positive Future for all.”
DELIVERY ON 2021-2023 STRATEGY: “MAXIMIZING IMPACT”Over the last
3 years, Arcadis has implemented its “Maximizing Impact” strategy
by implementing a Global Business Area (GBA) structure, investing
in Global Excellence Centers (GECs) and repositioning its business
through portfolio optimization and the acquisitions of Arcadis IBI
and Arcadis DPS.
Through the implementation of its strategy, Arcadis has
successfully delivered on its financial targets, with an annualized
organic net revenue growth of 7% and a year-to-date 2023 operating
EBITA margin in excess of 10%. Arcadis also largely delivered on
its key non-financial targets. This creates a solid foundation for
the future and the next strategic cycle.
2024-2026 STRATEGY: “ACCELERATING A PLANET POSITIVE
FUTURE”Building on its 2021-2023 “Maximizing Impact” strategy,
Arcadis’ 2024–2026 strategy is focused on Accelerating a Planet
Positive Future by addressing clients’ needs as they pursue their
objectives including decarbonization, electrification and the
transition towards renewable energy sources, the onshoring of
advanced industrial facilities, the need to replace and upgrade
existing infrastructure whilst moving to smarter, more efficient
and cleaner modes of transportation.
These trends are driving demand across global markets,
particularly in North America and Europe, in areas where Arcadis
has leading positions. In addition, by combining AI and the use of
data and with deep asset knowledge, Arcadis can help clients
repurpose and improve their assets. Arcadis is ideally positioned
to make a positive difference. Building on a strong 2021-2023
foundation, Arcadis will Accelerate a Planet Positive Future
through the delivery of the following three strategic
priorities:
Sustainable Project ChoicesArcadis will focus
on projects that contribute to its strategic ambition, making
deliberate bidding choices that reflect Arcadis values and economic
criteria as well as increasing the robustness of project selection
processes. In addition, expanding the successful Key Client Program
will be a key element of this strategy to drive growth and increase
the potential for margin improvement. The company will also
increase its focus on opportunities to cross sell between its
Global Business Areas delivering further operating leverage.
Digital + Human InnovationArcadis will build on
its digital leadership, including through its Intelligence GBA,
providing innovative technology-enabled solutions and products
across the entire asset lifecycle. Arcadis will continue to invest
in new digital products and expand its offering to provide even
greater value to clients through asset optimization and efficiency
savings. Within its own operations, Arcadis will accelerate
implementation of digitalization, standardization and automation of
operating procedures, reducing non-billable hours and driving
efficiencies.
Powered by PeopleArcadis will continue to
develop and invest in its people by creating a Skills Powered
Organization that will provide its people the skills to address
future client needs and deliver improved workforce efficiency This
involves enhancing people development and career paths through
prioritizing continuous learning, expertise, and adaptability among
its people with initiatives such as the Arcadis Energy Transition
Academy. It will also enable an optimized allocation of resources
and skills to projects as required. In addition, Arcadis will
reinforce its GEC organization, increase GEC recruitment and
explore new locations for further growth to enable it to double the
contribution of its GECs to the total billable hours of its
projects.
FINANCIAL TARGETS FOR 2026Arcadis targets mid-high single digit
organic annualized net revenue growth for 2024–2026 and aims to
further improve operating EBITA margin to at least 12.5% in 2026.
Arcadis will also maintain a balanced capital allocation framework,
including a commitment to a dividend pay-out ratio of 30% to 40% of
Net Income from Operations and to retain its Investment Grade
credit rating, with a target leverage ratio of 1.5-2.5x Net Debt /
Operating EBITDA.
NON-FINANCIAL TARGETS FOR 2026Arcadis embeds sustainable values
into all client solutions, business operations, and people and
community programs. The company is developing new client
methodologies and tools to measure sustainability across five core
themes - Carbon, Nature, Water, Circularity and Social Impact. Over
the next strategy cycle Arcadis commits to a 70% reduction in Scope
1 and 2 GHG emissions by 2026 and a 45% reduction in Scope 3 GHG
emissions by 2029. The company also aims to remain in the top 25%
of the professional services sector for employee satisfaction, as
measured by Employee Net Promotor Score, and targets to improve
gender diversity with over 40% of people across the organization to
be female.Arcadis is well-positioned to continue its journey of
profitable growth, sustainability, and innovation as it strives to
accelerate a planet positive future. The Arcadis 2024-2026 Strategy
update will be presented today during a Capital Markets Day in
London.
INVESTOR RELATIONSChristine Disch | +31(0)615376020 |
christine.disch@arcadis.com
CORPORATE COMMUNICATIONSChris Wiggan | +44(0)7966404889 |
chris.wiggan@arcadis.com
ANALYST PRESENTATIONArcadis 2024-2026 Strategy “Accelerating a
Planet Positive Future” will be presented and live streamed at
14.00 hours CET, for registration please follow the link:
https://strategy.arcadis.com/registration-virtual-event/
More information can be found on the strategy microsite:
https://www.arcadis.com/en/investors/capital-markets-day
Analyst presentation:
https://www.arcadis.com/en/investors/publications-and-presentations---download-center#search-download-center_downloadyear=2023
ABOUT ARCADISArcadis is the leading global design &
consultancy organization for natural and built assets. We maximize
impact for our clients and the communities they serve by providing
effective solutions through sustainable outcomes, focus and scale,
and digitalization. We are 36,000 people, active in more than 70
countries that generate €4.0 billion in gross revenues. We support
UN-Habitat with knowledge and expertise to improve the quality of
life in rapidly growing cities around the world.
www.arcadis.com
REGULATED INFORMATIONThis press release contains information
that qualifies or may qualify as inside information within the
meaning of Article 7.1 of the EU Market Abuse Regulation.
FORWARD LOOKING STATEMENTSStatements included in this press
release that are not historical facts (including any statements
concerning investment objectives, other plans and objectives of
management for future operations or economic performance, or
assumptions or forecasts related thereto) are forward-looking
statements. These statements are only predictions and are not
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typically identified by the use of terms such as “may”, “will”,
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forward-looking statements are based upon our current expectations,
plans, estimates, assumptions and beliefs that involve numerous
risks and uncertainties. Assumptions relating to the foregoing
involve judgments with respect to, among other things, future
economic, competitive and market conditions and future business
decisions, all of which are difficult or impossible to predict
accurately and many of which are beyond our control. Although we
believe that the expectations reflected in such forward-looking
statements are based on reasonable assumptions, our actual results
and performance could differ materially from those set forth in the
forward-looking statements.
- Arcadis 2024-2026 Strategy Press Release
- Arcadis 2024-2026 Strategy Presentation
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