Suez Environnement - 3rd Quarter 2010 Results
PARIS, October 28, 2010 /PRNewswire-FirstCall/ --
- Acceleration of Growth and Reduced Net Debt
- Strong growth in revenue: EUR10,135m, +11.8% at constant forex,
up in all divisions
- EBITDA: EUR1,690m, +9.9% at constant forex, an EBITDA margin of
16.7%
- Net financial debt down to EUR7,319m, a net financial
debt/EBITDA ratio of 3.25x[1]
In EUR million September 30, September 30, Total Variation Organic
2009 2010 change at constant change
forex
Revenues 8,923 10,135 +13.6% +11.8% +9.6%
EBITDA 1,498 1,690 +12.8% +9.9% +2.9%
EBITDA / Revenues 16.8% 16.7%
At 30 September 2010, SUEZ ENVIRONNEMENT's revenue was EUR10,135m, up +11.8% at constant forex compared to 30 September 2009 (vs. +10.8% for H1 2010). All three divisions generate growth, particularly sustained for the international activities and in sorting & recycling in Europe. In Q3 2010, SUEZ ENVIRONNEMENT confirmed its commercial dynamics, winning contracts such as the Suffolk and South Tyne and Wear[2] waste PFIs[3] in the United Kingdom and the Strasbourg and Acheres wastewater contracts in France.
- EBITDA at end September 2010 was EUR1,690m, up +9.9% at constant forex compared to +7.2% for the first semester. EBTIDA margin was 16.7%, stable compared to 30 September 2009 but up sharply versus 30 June 2010, with an EBITDA margin of 18.3% in the third quarter compared to 17.9% over the same period last year. Margins were up notably for the Water Europe division and due to cost savings achieved.
- The Group's net financial debt was EUR7,319m. It was down EUR1bn (-12%) compared to 30 June 2010 thanks to strong Free Cash Flow generation, a least unfavourable forex impact, and a financing structure strengthened by the issue of hybrid securities made at good market conditions. At 30 September 2010, SUEZ ENVIRONNEMENT had a net financial debt/EBITDA ratio of 3.25x1.
- Commenting on Q3 2010 performance, Jean-Louis Chaussade, CEO of SUEZ ENVIRONNEMENT, stated: "At 30 September 2010, SUEZ ENVIRONNEMENT posted a strong growth of its operating performance. The Group's positions outside Europe allows us to benefit from a faster growth internationally, especially in Asia and Australia. In Europe, where industrial activity is still low, we continue to grow in water by consolidating Agbar's activities, and our sorting & recycling activities are growing strongly. We met major commercial successes and improved our financial profile. We are very confident about achieving our 2010 targets."
BREAKDOWN OF ACTIVITY AT END-SEPTEMBER 2010
In EUR million September 30, September 30, Total Variation Organic
2009 2010 change at constant change
forex
REVENUES
In EUR million
Water Europe 2,894 3,085 +6.6% +6.4% +1.4%
Waste Europe 3,957 4,363 +10.3% +9.4% +8.6%
International 2,061 2,675 +29.8% +22.7% +21.0%
Other[4] 11 12 +7.7% - -
TOTAL 8,923 10,135 +13.6% +11.8% +9.6%
At 30 September 2010, SUEZ ENVIRONNEMENT posted EUR10,135m revenues, a +13.6% gross variation (+EUR1,212m) compared to 30 September 2009. This change breaks down as follows:
- +11.8% growth at constant forex (+EUR1,032m), i.e.:
- +9.6% organic growth (+EUR834m) coming from all three divisions:
- A +EUR37m (+1.4%) increase in the Water Europe division revenue, up for
both Lyonnaise des Eaux and Agbar, despite declining volumes for the
3rd quarter in France and Spain. Commercial activity and indexation
formulas have a favourable impact.
- Growth of +EUR340m (+8.6%) in the Waste Europe division, from the
progression of Sorting & Recycling activities, with an increase in
prices for secondary raw materials, and improved volumes.
- A +EUR457m (+21.0%) increase in the International division, where
activity is sustained in all geographic segments.
- Scope impact of +2.2% (+EUR198m):
- Water Europe: +EUR129m, with the net impact of the friendly takeover of
Agbar's water activities and to a lesser extent, the impact of the
unbundling of joint companies in water in France.
- Waste Europe: +EUR32m from the consolidation of Boone Comenor in Turkey
and Slovakia, and the disposal of the Group's stake in the London Waste
incinerator.
- International: +EUR37m with the increased stake in SITA Waste Services
in Hong Kong.
- Favourable forex impact of +1.8% (+EUR180m), due to the appreciation of
SUEZ ENVIRONNEMENT's main trading currencies, including the Australian
dollar (+EUR55m), the Chilean peso (+EUR24m), the British pound
(+EUR22m), the US dollar, and the Swedish krona.
- At 30 September 2010, SUEZ ENVIRONNEMENT generated 75% of its revenues
in Europe and 25% internationally, with growth in activity in Asia-
Pacific, and notably in Australia with the progress of the Melbourne
contract and growth in SITA Australia's activity.
PERFORMANCE BY DIVISION
WATER EUROPE
In EUR million September 30, September 30, Total Variation Organic
2009 2010 change at constant change
forex
Revenues 2,894 3,085 +6.6% +6.4% +1.4%
The Water Europe division posted organic growth of +1.4% (+EUR37m).
- Lyonnaise des Eaux posted organic growth of +1% (+EUR12m).
In France, activity is growing due to the application of indexation formulas that are still positive, though increasing less than last year, and thanks to commercial development, service activities, and the construction of wastewater treatment plants in Cannes, Dignes, and Port-Saint-Louis-du-Rhone. On the other hand, the change in revenues is negatively impacted by the end of the Paris contract and by water volume sold down -1% compared to 30 September 2009, given the third-quarter climatology. The contribution of works, which represent less than 10% of revenue, is stable. The commercial dynamism brought in contracts such as: Strasbourg (8 years, EUR98m), the aquatic centre of Sartrouville (DBO, 20 years, EUR50m), and the renewal of Blaye contract (17.5 years, EUR18m). Ondeo IS' activity is decreasing, while the development of Safege, Eurawasser, and Italy continues.
- Agbar posted +2% (+EUR25m) organic growth.
The water and wastewater activities posted price increases in Spain and the UK, but were globally down, due to the decline in works resulting from the economic downturn and from the finalization of large-scale projects in 2009 (Barcelona, San Joan Despi). Volumes are down slightly in Spain but sharply up internationally. In 2010, Agbar won many contracts, such as Calvia (50 years, EUR980m), Ponferrada (25 years, EUR137m) and in Q3, Saragossa (4 years, EUR18m). Health Insurance activities, disposed in June 2010, posted an increase in activity over the five consolidated months.
WASTE EUROPE
In EUR million September 30, September 30, Total Variation Organic
2009 2010 change at constant change
forex
Revenues 3,957 4,363 +10.3% +9.4% +8.6%
The Waste Europe division posted organic growth of +8.6% (+EUR340m). Sorting & Recycling activities benefited from the return to sustained secondary raw materials prices and an increase in volumes. Other activities in the Waste Europe division have a comparable evolution to that of 30 June 2010, up for large industrial clients and with an increase in valorized volumes.
- Revenue in France grew organically by +11% (+EUR237m) at 30 September
2010, driven almost exclusively by Sorting & Recycling activities;
waste volumes in other activities remaining low, in line with moderate
economic growth. SITA France continues to grow with new municipal
contracts, such as the City of Orleans collection (5 years, EUR14m),
industrial & commercial contracts with Exxon Mobil and Renault, and
new offers such as the establishment of a "mobile drop-off facility" in
the Port of Paris to allow waste to be evacuated to sorting centers by
waterways.
- Revenue in the UK-Scandinavia region was up +2% organically at end
September 2010 (+EUR16m). The price effect is favorable in the UK
thanks to price increase in Sorting & Recycling. Landfilled volumes
were down, with weak industrial activity. The third quarter for SITA
UK was marked by the signature of the PFI contract with Suffolk (25
years, GBP1 billion), and the qualification as preferred bidder for the
South Tyne and Wear PFI (30 years, GBP1 billion). In Scandinavia,
activity is stable in Finland, and remains sustained in Sweden.
- The Benelux-Germany region posted organic growth of +9% (+EUR87m) at 30
September 2010, thanks to Sorting & Recycling activity, both in prices
and volumes. Collection prices were down in Belgium and the Netherlands.
SITA News[5] continues its commercial development by winning municipal
and industrial & commercial contracts such as waste management for
Marburg-Bidenkopf (Germany, 6 years, EUR11m), and the renewal of the
contracts for organic waste treatment with Minet Kompost (Luxembourg,
5.5 years, EUR11m) and for paper recycling with IMOG (Belgium, 5 years,
EUR10m).
INTERNATIONAL
In EUR million September 30, September 30, Total Variation Organic
2009 2010 change at constant change
forex
Revenues 2,061 2,675 +29.8% +22.7% +21.0%
The International division had very high organic growth of +21.0% with dynamic activities in all regions.
- Degremont's revenue recorded organic growth of +52% (+EUR354m), driven both by the progress in the construction of Melbourne desalination plant and by the contributions of contracts in France (Bordeaux), Latin America (Replan and Rlam in Brazil, Mapocho in Chile, Panama, Ciudad Juarez in Mexico), Asia (Chengdu in China), and Australia (Pimpama). Its engineering backlog is still at a historic level of EUR1.9bn, with new contracts such as Acheres (EUR110m) awarded in July 2010.
- North America posted +6% (+EUR25m) organic growth resulting from the
strong growth in United Water's regulated activity, thanks to
improvement in volumes sold and higher prices as a result of the
different rate cases obtained, including the last one in August 2010,
New Jersey with a tariff increase of +8%.
- Asia-Pacific recorded +9% (+EUR44m) organic growth, supported by waste
activities in Australia and by prices and volumes increases in water in
China. Activity for SITA Waste Services in Hong Kong is up thanks to
the increase in treated volumes.
- The CEMME zone[6] posted +6% (+EUR34m) organic growth, benefiting from
a high level of activity in water in Morocco with an increase in prices
and volumes. In Central European waste, activity is also up, with
improved industrial & commercial volumes.
CONFIRMATION OF OBJECTIVES
SUEZ ENVIRONNEMENT confirms all its objectives as updated in the publication of the half-year results on 4 August 2010.
NEXT COMMUNICATIONS
- 09 February 2011: Publication of 2010 Annual Results
- 19 May 2011: Annual Shareholders' Meeting
APPENDIX
Geographic breakdown of revenues
Revenues September 30, 2009 September 30, 2010 Total change
EUR m % of total EUR m % of total EUR m %
Europe 7,044 78.9% 7,633 75.3% 589 8.4%
France 3,587 40.2% 3,748 37.0% 161 4.5%
Spain 1,180 13.2% 1,401 13.8% 221 18.7%
UK 674 7.6% 638 6.3% -36 -5.4%
Other Europe 1,602 18.0% 1,845 18.2% 243 15.2%
North America 570 6.4% 620 6.1% 50 8.8%
Australia 223 2.5% 560 5.5% 337 150.9%
Sub-total 7,837 87.8% 8,813 86.9% 976 12.4%
Rest of the world 1,086 12.2% 1,323 13.1% 237 21.8%
TOTAL 8,923 100.0% 10,135 100.0% 1,212 13.6%
Natural resources are not infinite. Each day, SUEZ ENVIRONNEMENT (Paris: SEV, Brussels: SEVB) and its subsidiaries deal with the challenge to protect resources by providing innovative solutions to industries and to millions of people. SUEZ ENVIRONNEMENT supplies drinking water to 90 million people, provides wastewater treatment services for 58 million people and collects the waste produced by 46 million people. SUEZ ENVIRONNEMENT has 78,700 employees and, with its presence on a global scale, is a world leader exclusively dedicated to environmental services. SUEZ ENVIRONNEMENT, a 35.4% GDF SUEZ affiliate, reported sales turnover of 12.3 billion euros at the end of financial year 2009.
Disclaimer
This document includes non audited financial data. The aggregates shown are those customarily used and communicated to the markets by SUEZ ENVIRONNEMENT.
"The actual communication includes forward looking information and statements. Those prospective elements are based upon hypothesis, financial projections, estimations and statements regarding projects, objectives and expectations concerning operations, future products or services or future performances. No guarantee can be given on the realization of those prospective elements. Investors and shareholders of SUEZ ENVIRONNEMENT Company shares are informed that those forward looking information and statements are subject to a number of risks and uncertainties, hardly predictable and generally outside SUEZ ENVIRONNEMENT Company control and that could cause actual results to differ materially from those expressed, suggested or forecasted by any such forward looking information and statements. Those risks include, but are not limited to, those developed or identified in public documents filed with the Autorite des Marches Financiers (AMF). The attention of investors and shareholders of SUEZ ENVIRONNEMENT Company shares is drawn on the fact that the realization of all or part of those risks is susceptible to have a significant unfavourable effect on SUEZ ENVIRONNEMENT Company. Suez Environnement Company disclaims any obligation or undertaking to release publicly any updates or revisions to any of those forward-looking statements."
[1] Rolling 12-month EBITDA Pro forma, with Agbar fully consolidated over 12 months, net financial debt/EBITDA would be at 3.1x
[2] Preferred bidder for the South Tyne and Wear PFI
[3] Private Finance Initiative
[4] R+I Alliance, HQ
[5] SITA News : Waste activities in Benelux & Germany
[6] Central Europe, Mediterranean, Middle East.
This press release is also available on
http://www.suez-environnement.com
SOURCE Suez Environment
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