Strong Growth in Half-Year Results,
Reflecting the Solidity of Veolia’s Value Creation Model and the
Good Start of Its GreenUp Strategic Program
- Solid revenue growth of +4.4%(1) driven by Booster
activities up +6.9%(1), while Stronghold activities are up
+3.4%(1)
- Robust operational performance with a strong EBITDA increase
of +5.7%(2), supported by revenue growth, operational
efficiency as well as synergies ahead of annual target. Current
net income up +15.2%(3) to €731m
- Continued dynamic capital allocation policy contributing
to value creation while preserving a solid balance sheet, with
€1bn+ of non-strategic asset divestments signed in the first half,
and several targeted acquisitions in priority activities
- Objectives for 2024 and GreenUp 2024-2027 fully
confirmed
- Veolia, first company to obtain double validation by
SBTi and Moody's for its climate trajectory, compatible with the
1.5°C ambition
Revenues of €22,141m with solid growth of +4.4%(1):
- Strong growth in Water (+6.4%(2)) and Waste (+6.4%(2))
- Revenue increase in Energy (+1.4%(2)(4)) with sustained high
levels of profitability
- After taking into account the effect of lower energy prices,
total Group revenues are slightly up +0.4%(2)
EBITDA of €3,266m, a strong organic growth of +5.7%(2),
within the guidance range of +5% to +6%(2):
- €194m in efficiency gains, for an annual target of €350m
- €71m in synergies, ahead of annual target
Current EBIT up +6.6%(2), to €1,730m
Current Net Income - Group Share of €731m up +15.2%(3), on
track with the annual target above €1.5bn, and Net Income - Group
Share up +24.6%
Net financial debt well under control, with a leverage ratio
expected below 3x at end 2024
Objectives for 2024 and GreenUp 2024-27 fully
confirmed
(1) At constant scope and forex excluding energy prices (2) At
constant scope and forex (3) At constant forex (4) Excluding energy
prices and weather impact
Regulatory News:
Veolia Environnement (Paris:VIE):
Estelle Brachlianoff, CEO of the Group, commented :
“At mid-year, Veolia posted a very solid performance, perfectly
aligned with the priorities of the GreenUp Strategic Program that
we have recently launched. EBITDA was up +5.7%1 and current net
income up +15.2%2, in line with our expectations. These excellent
results reflect our commercial dynamism and operational excellence,
as well as the vitality of demand, which translates in the sound
growth of our Water and Waste activities. The unique combination of
water / energy / waste activities which enables us to offer
efficient and innovative solutions to our customers has once again
been key to our commercial wins, as illustrated by the examples of
Saint-Fons in France or New-Orleans in the United States, two major
wastewater treatment plants contracts where our know-how in energy
was key.
During this first-half, we have also pursued the transformation
of our portfolio of activities according to our strategic plan, by
divesting non-strategic assets for a total amount of more than 1
billion euros, while simultaneously reinvesting in new acquisitions
that create value in our priority activities.
We expect these positive trends to continue in the second-half,
which enables us to fully confirm all our targets for the
year.”
Detailed key figures at June 30, 2024
Group consolidated revenues amounted to 22,141 million euros at
June 30, 2024, compared to 22,755 million euros at June 30, 2023.
They varied by +0.4% on a like-for-like basis, and by +4.4%
excluding the impact of energy prices, which mainly affected Europe
excluding France.
Revenue growth by effect breaks down as follows:
- The currency effect was a negative €442 million (-1.9%),
mainly reflecting fluctuations in Argentinian, Chilean and Czech
currencies, partially offset by an improvement in the Polish
currency3.
- The perimeter effect of -260 million euros (-1.1%)
mainly includes the impact of the disposal of SADE on February 29,
2024, the acquisition of Hofmann (Germany) in the first quarter
2024, and the entry into the perimeter of Lydec (Morocco) on
January 25, 2023.
- The commodity price effect (corresponding to changes in
energy and recyclate prices) amounted to -915 million euros
(-4.0%), due to lower energy prices (-917 millions euros), mainly
in Central and Eastern Europe, with an almost neutral effect of
recyclate prices (+2 millions euros).
- The climate effect amounted to -143 million euros
(-0.6%), mainly in Central and Eastern Europe, where energy sales
were impacted by a milder winter than in 2023.
- Intrinsic growth was driven by positive commercial and
price effects. The Commerce / Volumes / Works effect amounted to
+355 million euros (+1.6%), driven by a good commercial momentum,
healthy water volumes, the increase in works carried out, as well
as strong growth in Water Technologies activities. Favorable price
effects amounted to +790 million euros (+3.5%), mainly due to
tariff indexations and price increases of +5.3% in waste and +4.2%
in water.
Revenues at June 30, 2024 progressed across all operating
segments compared with June 30, 2023
Compared with June 30, 2023, sales at June 30, 2024 varied by
+0.4% on a like-for-like basis. Sales rose sharply in the Water
Technologies segment, grew steadily in the Rest of the World
segment, and grew moderately in France and Special Waste Europe,
whereas they fell in the Europe excluding France segment due to
lower energy prices than in 2023.
Revenues in France and Special Waste Europe amounted to
4,531 million euros and showed organic growth of +2.9% compared to
June 30, 2023.
- Water France sales of 1,492 million euros were up +4.5%
on a like-for-like basis, mainly fueled by the +4.6% positive
effect of tariff indexations, minus the impact of lower volumes,
down -0.5%.
- Sales of Waste France amounted to 1,482 million euros
and rose by +2.0% on a like-for-like basis due to the positive
effect of tariff indexation and prices increases, and despite
slight volume increase while maintaining commercial
selectivity.
- Special Waste Europe sales reached 1,114 million euros,
up +7.1% on a like-for-like basis, mainly due to the increase in
tariffs for hazardous waste treatment and sanitation maintenance
activities, which offset the impact of lower oil prices. First-half
volumes were broadly resilient compared with 2023.
Revenues in Europe excluding France reached 9,252 million
euros at June 30, 2024, an organic variation of -7.7%, due to lower
energy prices than in 2023. Excluding the effect of energy prices,
revenues rose by +1.4%.
- In Central and Eastern Europe, sales stood at 5,412
million euros, down -13.3% on a like-for-like basis, heavily
impacted by lower energy prices and to a lesser extent by an
unfavorable climate effect (-136 millions euros) due to a milder
winter than last year.
- In Northern Europe, revenues of 2,094 million
euros rose by +3.5% on a like-for-like basis. This increase was
mainly attributable to sales in the United Kingdom, up +4.0% on a
like-for-like basis, predominantly in the waste activity, which
benefited from tariff indexation and an increase in volumes
processed, particularly in incineration, as a result of very good
plant availability.
- In Iberia, sales stood at 1,279 million euros, up +1.1%
on a like-for-like basis. Water activities mainly benefited from
tariff increases, although volumes were down slightly. Energy
activities were impacted by the drop in prices.
- Italy generated revenues of 467 million euros, down
-6.7% on a like-for-like basis, mainly due to the drop in energy
prices, with no impact on margin due to a parallel decrease in
energy purchase costs.
Revenues in Rest of the world reached 5,956 million
euros, an organic growth of +6.5%, up in all geographies, excluding
Asia.
- Revenue stood at 945 million euros in Latin America, up
+25.9% on a like-for-like basis. This was mostly supported by high
waste volumes, particularly in Brazil and Colombia, the effect of
tariff reviews on water activities in Chile, and the impact of
hyperinflation in Argentina (offset by the devaluation of the
Argentine peso).
- In Africa Middle-East, revenues totaled 1,102 million
euros, up +4.1% on a like-for-like basis, mainly driven by the
growth of energy services in the Middle East and the increase in
activity in Morocco.
- In North America, revenues reached 1,683 million euros,
up +2.6% on a like-for-like basis. The Hazardous Waste activity
performed strongly, boosted by price increases and strong
commercial activity. The Water activity benefited from tariff
increases, with higher volumes in the “regulated water”
activity.
- Sales in Asia amounted to 1,202 million euros, down
-1.3% on a like-for-like basis, mainly due to lower activity at
hazardous waste treatment plants in China and India. These effects
were partially offset by strong commercial momentum in energy
efficiency in Hong Kong and water in Japan.
- In the Pacific region, sales of 1,025 million euros were
up +6.5% on a like-for-like basis, mainly driven by tariff
revisions and higher volumes of waste processed, as well as good
commercial momentum in industrial maintenance.
The Water Technologies activity reported sales of 2,398
million euros, up +15.5% on a like-for-like basis, driven by WTS
growth in the Engineering Systems and Chemical Solutions
businesses, as well as by VWT growth in its Project activities.
The organic growth of revenues by business compared to June
30, 2023 is as follows:
- Sales in the Water activity rose by +6.4% on a
like-for-like basis to 8,798 million euros, driven by an increase
in Water operations (+3.6% on a like-for-like basis) and growth in
Technology and Construction (+12.6% on a like-for-like basis).
- Water Operation revenues rose by +3.6% on a like-for-like
basis, to 6,236 million euros, with tariff increases across all
geographies, a good level of construction activity and increasing
volumes, mainly in Central and Eastern Europe (+2.6%), the United
States (+1.3%) and Chile (+0.9%), offsetting falls in France
(-0.5%), due to a wet spring, and Spain (-0.6%) due to
drought-related restrictions.
- Technology and Construction sales rose by +12.6% on a
like-for-like basis, to 2,563 million euros, driven mainly by Water
Technologies.
- Sales for Waste activity revenues increased by +6.4 % on
a like-for-like basis, to 7,728 million euros. It benefited from
favorable price revisions (+5.0%). The price of recyclate began to
rise again in April 2024 (mainly paper) and is stable overall
compared with the first half of 2023. The Commerce/Volume/Works
effect was positive (+1.4%), with an increase in volumes,
particularly in the United Kingdom and Australia, and an increase
in hazardous waste activity outside Asia.
- Revenues of Energy activity amounted to 5,615 million
euros and varied by -14.4% on a like-for-like basis, owing to the
drop in energy prices, impacted by the price of electricity, while
heating tariffs rose. The unfavorable weather impact in the first
half of 2024 accounted for -2.2% of Energy revenues due to a milder
winter. Energy services sales benefited from a solid commercial
activity in Belgium, the Middle East and Hong Kong. Excluding
energy prices and weather impact, Energy sales were up +1.4%.
Strong EBITDA growth, to €3,266m compared with €3,162m at
June 30, 2023, i.e. +5.7% organic growth
The currency impact on EBITDA amounted to -95 million
euros (-3.0%). This mainly reflects the depreciation of the
Argentinian, Chilean and Czech currencies, partially offset by a
rise in the Polish currency4.
The perimeter impact of +19 million euros (+0.6 %) mainly
includes the impact of the acquisition of Hofmann (Germany) in the
first quarter 2024, and the inclusion of Lydec (Morocco) in the
scope of consolidation on January 25, 2023, partially offset by the
disposal of SADE on February 29, 2024.
External factors negatively impacted EBITDA:
- Changes in commodity prices (energy and recycled
materials) had a net unfavorable impact on EBITDA of -39 million
euros (-1.2%), mainly due to lower energy prices net of lower
energy purchasing costs, for -44 million euros, partially offset by
an increase in recycled materials prices (+5 million euros).
- The climate impact was -42 million euros (-1.3%), mainly
in Central and Eastern Europe, affected by a milder winter than in
2023.
Intrinsic growth was driven by favorable
Commerce/Volumes/Works effects, by efficiency gains generated by
the Group, of which 44% have been retained, and by synergies
generated following the integration of Suez.
- The Commerce/Volumes/Works effect was favorable at +105
million euros (+3.3%) and resulted from its positive effect on
sales.
- The net efficiency gains, net of gains shared with
customers, contract renegotiations and time-lag effects on
passing-on of costs generated an additional 86 million euros
(+2.7%) in EBITDA in first-half 2024. This represents a retention
rate of 44% of the gains generated by the Group under the
efficiency plan.
The gains generated by the efficiency plan contributed
194 million euros in the first-half 2024, ahead of the target of
350 million euros for 2024. The plan focuses primarily on operating
efficiency (68%) and purchasing (22%), and concerns all geographies
: France and Special Waste Europe (22%), Europe excluding France
(43%), Rest of the World (29%), and Water Technologies (6%).
Synergies generated by the integration of Suez amounted
to 71 million euros. Together with synergies already realized in
2022 and 2023, they amounted to 386 million euros, ahead of the
cumulated target of 400 million euros by the end of 2024, thanks in
particular to economies of scale in purchasing.
Current EBIT growth of +6.6% at €1,730m, at constant scope
and forex
The increase in current EBIT compared with June 30, 2023 at
constant scope and forex amounted to +111 million euros (+6.6%),
and was mainly due to:
- a strong growth in EBITDA (+180 million euros at constant scope
and forex);
- a rise in amortization5 (including the repayment of operating
financial assets) of -68 millions euros on a like-for-like basis,
mainly related to Central and Eastern Europe (notably
Uzbekistan);
- the positive impact of “provisions net of capital gains on
disposals, and others” of +6 million euros at constant scope and
forex);
- a decrease in the share of net income from joint ventures of -7
million euros at constant scope and forex, due to a non recurring
item in first quarter 2023.
The currency effect on current EBIT was negative by -63 million
euros and mainly reflected the change in Argentinian (-35 million
euros) and Chilean (-20 million euros) currencies.
Current net income of €731m, sharply up +15.2% at constant
forex
Current net income Group share (before PPA of -20 million euros)
reached 731 million euros at June 30, 2024, compared with 662
million euros at June 30, 2023 (+15.2% at constant forex).
- The cost of net financial debt amounted to -331 million euros
compared with -312 million euros at June 30, 2023. This increase is
mainly due to a non-recurring product in first-half 2023 and to
changes in the balance of variable financial expenses and income
from deposits. The Group financing rate6 was therefore 3.83%;
- Other current financial income and expenses totaled -177
million euros compared with -120 million euros in first-half 2023
which benefited from exceptional favorable effects partially
reversed during the second-half;
- Capital gains and losses on financial disposals reached +53
million euros compared with -3 million euros and mainly included
capital gains on the disposal of SADE;
- The current income tax expense reached -321 million euros and
reflected the increase in current income before tax. This
represented a current income tax rate of 26.2%, versus 28.0% for
the first-half 2023;
- Minority interests amounted to -223 million euros compared with
-245 million euros at June 30, 2023.
Net income Group Share up +24.6%
The very strong increase in net income Group share at 651
million euros at June 30, 2024 compared with 523 million euros at
June 30, 2023 was due to the strong increase in current net income
and to the strong decrease in costs associated with the Suez
acquisition and integration to -13 million euros compared with -55
million euros.
Well controlled net financial debt
Net free cash-flow before financial investments and
dividends stood at -284 million euros at June 30, 2024, and varied
by -206 million euros compared to June 30, 2023 (-78 million
euros).
The change in net free cash-flow compared to June 30, 2023 is
explained by:
- EBITDA growth driven by organic growth and operational
and commercial efficiency gains, as well as synergies;
- Net capital expenditure of -1,722 million euros, which
remained roughly stable compared with June 30, 2023 (+1.6%). This
includes in particular the on-going decarbonation projects in
Central and Eastern Europe, as well as investments in hazardous
waste projects;
- The change in operating working capital of -998 million
euros, which deteriorated by -177 million euros compared to June
30, 2023, impacted by advances received in 2023 in connection with
Water Technologies projects and projects in Germany, as well as
greater disbursements than in 2023 for CO2 allowance
purchases;
- The change in financial expenses of -157 million euros
compared with June 30, 2023, which stems mainly from a
non-recurring income in first-half 2023.
Net financial debt stood at 19,891 million euros at June
30, 2024, compared with 17,903 million euros at December 31, 2023.
Compared with December 31, 2023, the change in net financial debt
is mainly due to the following:
- net free cash-flow for the first-half of -284
million euro;
- net financial investments of -168 million euros
following the acquisition of Groupe Hofmann GmbH and the disposal
of subsidiary SADE;
- repayment of hybrid debt for -209 million euros,
including coupons;
- payment of the dividends voted by the Annual
Shareholders’ Meeting of April 25, 2024 to the amount of -895
million euros.
Net financial debt is also impacted by foreign exchange gains
and losses and fair value variation adjustments of -46 million
euros at June 30, 2024.
2024 Guidance fully confirmed
In view of the excellent results achieved in the first half
2024, guidance for 2024 is fully confirmed:
- Solid organic growth of revenue(1) (2)
- Efficiency gains above €350m complemented by additional
synergies for a cumulated amount of more than €400m end 2024, in
line with the €500m cumulated objective
- Organic growth(1) of EBITDA between +5% and +6%
- Current net income Group share above €1.5bn(3)
- Leverage ratio expected below 3x(3)
- Dividend growth in line with Current EPS growth
(1) at constant scope and forex / (2) excluding energy prices /
(3) excluding Suez PPA
GreenUp 2024-2027 targets fully confirmed
- Solid revenue growth7
- €350m savings per year
- Over €8bn of EBITDA in 2027
- ~ 10% annual growth8 in current net income
over 2023-2027
- Leverage ratio ≤ 3x
- Dividend growth in line with current
EPS
- €4bn of growth investments, of which €2bn are
prioritized on 3 growth boosters
- Decarbonization: 18m tons of CO2 erased in
2027 (scope 4) & emission reduction trajectory compatible
with 1.5°C warming (scope 1&2)
- Regeneration: 1.5 bn m3 of fresh water
saved in 2027
- Depollution: 10m tons of hazardous waste
and pollutants treated in 2027
Agenda
- October 17: Deep dive Water Technologies and Innovation in
Hungary
- November 7: 2024 third quarter results publication
ABOUT VEOLIA
Veolia group aims to become the benchmark company for ecological
transformation. Present on five continents with nearly 213,000
employees, the Group designs and deploys useful, practical
solutions for the management of water, waste and energy that are
contributing to a radical turnaround of the current situation.
Through its three complementary activities, Veolia helps to develop
access to resources, to preserve available resources and to renew
them. In 2023, the Veolia group provided 113 million inhabitants
with drinking water and 103 million with sanitation, produced 42
million megawatt hours of energy and recovered 63 million tonnes of
waste. Veolia Environnement (Paris Euronext: VIE) achieved
consolidated revenue of 45.3 billion euros in 2023.
www.veolia.com
IMPORTANT DISCLAIMER
Veolia Environnement is a corporation listed on the Euronext
Paris. This press release contains “forward-looking statements''
within the meaning of the provisions of the U.S. Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are
not guarantees of future performance. Actual results may differ
materially from the forward-looking statements as a result of a
number of risks and uncertainties, many of which are outside our
control, including but not limited to: the risk of suffering
reduced profits or losses as a result of intense competition, the
risk that changes in energy prices and taxes may reduce Veolia
Environnement’s profits, the risk that governmental authorities
could terminate or modify some of Veolia Environnement’s contracts,
the risk that acquisitions may not provide the benefits that Veolia
Environnement hopes to achieve, the risks related to customary
provisions of divestiture transactions, the risk that Veolia
Environnement’s compliance with environmental laws may become more
costly in the future, the risk that currency exchange rate
fluctuations may negatively affect Veolia Environnement’s financial
results and the price of its shares, the risk that Veolia
Environnement may incur environmental liability in connection with
its past, present and future operations, as well as the other risks
described in the documents Veolia Environnement has filed with the
Autorité des Marchés Financiers (French securities regulator).
Veolia Environnement does not undertake, nor does it have, any
obligation to provide updates or to revise any forward-looking
statements. Investors and security holders may obtain from Veolia
Environnement a free copy of documents it filed (www.veolia.com)
with the Autorités des marchés financiers.
This document contains "non‐GAAP financial measures". These
"non‐GAAP financial measures" might be defined differently from
similar financial measures made public by other groups and should
not replace GAAP financial measures prepared pursuant to IFRS
standards.
___________________ 1 At constant scope and forex 2 At constant
forex 3 Main currency impacts: Argentine peso (-327 million euros),
Chilean peso (-68 million euros), Czech koruna (-59 million euros)
and Japanese yen (-35 million euros), compensated by Polish zloty
(+107 million euros) and British pound (+38 million euros) 4 Main
currency impacts : Argentine peso (-47 million euros), Chilean peso
(-29 million euros), Czech koruna (-16 million euros), offset by
Polish zloty (+14 million euros) 5 Excluding Suez PPA 6 Hors impact
IFRS 16. 7 Excluding energy prices 8 At constant exchange rates
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240731420998/en/
MEDIA RELATION Laurent Obadia - Evgeniya Mazalova
Anna Beaubatie - Aurélien Sarrosquy +33 (0) 1 85 57 86 25
presse.groupe@veolia.com
INVESTORS RELATIONS Selma Bekhechi - Ariane de
Lamaze +33 (0) 1 85 57 84 76 / 84 80
investor-relations@veolia.com
Veolia Environnement (EU:VIE)
Historical Stock Chart
From Dec 2024 to Jan 2025
Veolia Environnement (EU:VIE)
Historical Stock Chart
From Jan 2024 to Jan 2025
