PARIS, France, Aug. 7, 2002 -- Consolidated revenue for the first half of 2002 was €15 billion, up 7.2% from €14 billion in the first half of last year.
Excluding non-core businesses in the process of being divested, revenue growth was 9%, including internal growth of 5.5%.
Under French accounting standards, consolidated EBIT in the first half of 2002 was €1.018 billion, up 5.2%, compared to €967 million for the first half of 2001. Excluding non-core businesses in the process of being divested, EBIT grew 8%.
Net debt totaled €14.8 billion on 30 June 2002 compared to €14.3 billion on 31 December 2001 and €15 billion on 30 June 2001. Cash flow from operations together with the disposal of part of the non-core businesses have helped fund capital investment, for both maintenance and business growth, in the first half of the year.
The €1.5 billion capital increase completed in August 2002 and the continuation of the non-core business disposal program should lead to debt reduction in the second half of the year.
Excluding non-core businesses and the impact of the South Central transportation contract termination (€231 million), internal growth for the first half of 2002 was 7.5%.
The impact of external growth of €294 million was due to small and medium-sized acquisitions in the sectors of Waste (Marius Pedersen), Energy Services (Siram) and Transportation (Verney), as well as the disposal of non-core activities in the Water division in the United States.
The positive impact of foreign exchange (€69 million), relates mainly to the increase in the average rate of the US dollar against the euro in the first half of 2002 compared to the first half of 2001. Given recent trends in the euro-dollar exchange rate, this favorable impact is unlikely to be repeated in the second half of the year.
Revenue generated outside France was €8.6 billion, or 57% of total revenue, comparable to the first half of 2001.
Internal revenue growth was 4.4%. Excluding non-core businesses, internal growth was 5.9%. In France, Vivendi Water business grew by around 3.4% due to the continued good results of the water distribution business and stability in the water engineering business.
Internal growth for core businesses outside France was 9.1%. This growth reflects encouraging developments in outsourcing businesses outside the United States, up by 22%, due to start-ups or new contracts signed in 2000 or 2001, notably in Central Europe (Prague in the Czech Republic and Gorlitz in Germany), in Morocco (Tangiers and Tetouan), in the Asia Pacific region (Hyundai-HEI and Inchon in South Korea, Chengdu in China).
In the United States, revenue, as expressed in euros, was down by 2.2% and impacted by the finalization of the Filtration and Separation businesses disposal during the first half of 2002.
Core businesses grew (+6%) due to the solid continuation of the municipal outsourcing services business, which has benefited from the impact of the Indianapolis contract since the month of May 2002, and the industrial outsourcing business following on from the signature of new contracts. Sales of water treatment equipment and systems to the municipal sector are growing, while sales to industry are stable.
Internal growth was 5.8%. In France, growth was 4.1% with the group operating in a less favorable economic environment.
Outside France, business grew by 6.9%, largely due to developments in Northern Europe (contracts in Bromley and Sheffield in the UK), as well as in the Asia Pacific region, with a contract for Pacific Waste Management in Hong Kong, and in Singapore.
In the United States, business increased slightly (new municipal contracts for solid waste).
External growth was primarily due to the full first half year impact of the Marius Pedersen acquisition in 2001.
External growth stemmed from the integration of Ekonor in industrial waste in Spain, and internationally in the area of urban services.
Many of the figures in this report are preliminary and non-audited, prepared in accordance with French accounting standards.
The first half-year 2002 revenue growth provides confidence, within a stabilized economic environment, for the medium-term growth objectives of the company. This has been further strengthened by the receipt of new contracts since the beginning of this year, in particular the signing of a municipal outsourcing contract for the city of Indianapolis in the United States as well as that of the contract for Shanghai/Pudong, which constitute significant commercial successes.
Vivendi Environnement (Paris Bourse: VIE and NYSE:VE), comprised of Vivendi Water (worldwide water products and services), Onyx (solid waste and industrial services), Dalkia (energy management), Connex (transportation and logistics) and FCC (Spanish company engaged in environmental and construction related industries), is the largest environmental services company in the world with more than 295,000 employees, including FCC, in about 100 countries and annual revenues of more than $25.6 billion.
Press release also available on http://www.vivendienvironnement-finance.com
