Veolia Environnement: Key Figures as of September 30, 2022
(UNAUDITED DATA – AUDIT IN PROCESS)
REVENUE AND EBITDA GROWTH ACCELERATION IN Q3
VERY STRONG REVENUE AND RESULTS GROWTH IN THE FIRST 9 MONTHS OF 2022
INTEGRATION OF SUEZ AND EXECUTION OF THE €500M SYNERGY PLAN AHEAD OF SCHEDULE
CONFIRMATION OF ALL 2022 OBJECTIVES WITH AN EBITDA GROWTH AT THE UPPER END OF THE +4% TO +6% GUIDANCE RANGE
- 9 MONTH REVENUE OF €30 713 M, A VERY STRONG ORGANIC GROWTH OF +13.2 %1, AND OF +7.1 %1 EXCLUDING THE IMPACT OF ENERGY PRICES.
✔ 3rd QUARTER ORGANIC REVENUE GROWTH OF +13.7 %1
✔ INCREASED VOLUMES IN OUR 3 BUSINESSES, WATER, WASTE, ENERGY
✔ FAVORABLE IMPACT OF TARIFF INDEXATIONS AND OF OUR PROACTIVE PRICING POLICY
- EBITDA OF €4 533 M, UP +5.2 %, AT THE TOP OF THE GUIDANCE RANGE OF +4 % TO +6 % THANKS TO REVENUE GROWTH AND SYNERGY DELIVERY AHEAD OF PLAN :
✔ €98 M OF SYNERGIES ALREADY REGISTERED IN THE 9 MONTHS, vs. AN ANNUAL TARGET OF €100 M
✔ €264 M OF EFFICIENCY GAINS, vs. AN ANNUAL OBJECTIVE OF €350 M
✔ Q3 ORGANIC EBITDA GROWTH OF +9.4 %2, EXCLUDING Q3 2021 ONE OFF OF €83 M€.
- CURRENT EBIT OF €2 217 M, VERY STRONG ORGANIC GROWTH OF +19.4 %1
NET FINANCIAL DEBT DOWN BY €351 M AT 30 SEPTEMBER vs.
30 JUNE 2022EXCLUDING FOREX, THANKS TO €337 M NET FREE CASH FLOW GENERATION IN Q3
- CONFIRMATION OF ALL 2022 OBJECTIVES
1 at constant scope and forex
2 at constant scope and forex, excluding the €83M one off OFA reimbursement in Q3 2021 (Valaubia)
Detailed Key figures as of
- Revenue of €30 713 M in the 9 months 2022, up 49.1 % at constant forex vs. 9M 2021 reported. This very strong growth is derived primarily from the acquisition of Suez, which contributed to revenue growth for €7 128 M.
Compared to 9M 2021 combined
Veolia+ Suez, organic growth was+13.2%.
Revenue evolution by effect was as follows :
The following analysis of the Group’s activity is based on the combined figures of
Exchange rate effect was +€681 M (+2.5% of combined revenue) reflecting mainly the evolution of the US dollar, Australian dollar, Sterling pound and Chinese Renminbi, partially offset by a decrease of the Polish zloty, Hungarian forint and Latin American currencies1.
Scope effect of -€472 M (-1.8%) included mainly the asset divestitures in Scandinavia in 2021 (-€217 M) and, on the Suez side, the asset divestitures in
The Commerce / Volumes / Works effect reached +€763 M (+2.8%) thanks to good volumes in all businesses, notably in Energy and strong Water technologies and construction activities which strongly accelerated in Q3.
The weather impact was -€91 M (-0.3%). Energy in Central and
The energy price impact was+€1 658 M (+6.1%), due to the increase in heat and electricity prices mainly in Central and
The recycled materials price impact was +€288M, after €244 M in the first half, and came mainly from the increase of recycled papers in
Service prices continued to be well oriented , leading to a favorable impact of €935 M (+3.5%), mostly due to tariff indexation mechanisms and service price increases by an average of +4.3 % in waste and +3.4 % in Water.
30 September 2022progressed across all segments compared with combined figures at September 30, 2021, as in the first half:
Revenue for the France and Special Waste Europe segment totaled €7 135 M, with organic growth of +3.2 % compared with
September 30, 2021combined : France Waterrevenue increased by +1.4%, due to the positive impact of tariff revisions of +3.8 % at 30 September 2022and the good level of activity in Q3 with billed volumes up 0.8% compared with +0.3% in the 1st half. France Wasterevenue increased by+2.3 %, continuing to benefit from high recyclate prices and the positive impact of tariff revisions, despite a slight decline in volumes year-on-year.
- Hazardous Waste activities in
Europegrew by +5.7 %, with strong commercial development in sanitation and industrial maintenance activities (+4%),higher prices in oil and lubricant treatment activities in a context of increased oil prices and the positive impact of tariff revisions.
- SADE reported growth of +4.2 %, thanks to strong commercial momentum in
Europeexcluding France totaled €12 498 M at 30 September 2022, an organic growth of +23.4 %, the same pace as in the first half, thanks to energy price increases and good tariff indexations in water in Central and Eastern Europe.
In Central and
Eastern Europe, revenue rose by +34% to €6 185 M. Following on from the first half, activity remained robust in this region driven by:
greater positive tariff indexation in energy (
Poland, Hungary, Czech Republic Slovakia and Romania, and in water ( Czech Republicand Romania), and higher (+1.5%) water volumes distributed ( Polandand Czech Republic), despite an unfavorable weather effect in Energy in the 1st half 2022 (-€91 M).
an increase in recycled materials prices and in energy prices in
- greater positive tariff indexation in energy (
Northern Europe, revenue rose +10.7% to €3 760 M. This increase was primarily driven by the United Kingdomand Ireland, which reported revenue growth at constant scope and forex of +10.3% with the favorable impact of recycled materials price (paper and plastics), the increase of electricity prices, the good tariff indexation of PFIs (+7% on average) and the strong performance of the incinerators (availability rate of 93 %). In Belgiumorganic growth was +14.5 %, fueled by good operating performances.
Italy, organic revenue growth reached +43 % following the start-up of contracts won in 2021 and the highly favorable effect of energy prices.
In Iberia, revenue increased +13.8 %, driven primarily by strong water activities in
Spain(Agbar) which enjoyed increased volumes (+2.6 %), as well as by energy activities.
- In Central and
In Rest of the World, revenue totaled€8 156 M, representing organic growth of +8.5 % across all geographies, including
Asiadespite the slowdown in Chinadue to the lockdown policy :
Revenue increased +16.1 % in
Latin America, driven notably by Chile(+13.8%) which benefited from favorable water tariff indexations, and by Argentina(+80%).
Africa/ Middle East, revenue increased +9.9 %, mainly driven by growth in water contracts in Morocco, thanks to higher volumes and the positive impact of tariff revisions, and the very strong growth of Enova in the Middle Eastin energy efficiency services.
North America, revenue rose +11.4% to €2 498 M. The growth was mainly driven by robust hazardous waste activities with higher volumes processed and double digit price increases, and in water, by favorable tariff indexation particularly in regulated water activities, good summer volumes and good construction volumes.
Revenue increased +2.2% in
Asia. The slowdown in growth in Chinadue to the Covid lockdown policy negatively impacted activities, with lower hazardous waste volumes and reduced activity in energy and industrial services. This slowdown was offset by strong growth in other countries and particularly Taïwan (+11.9%), South Korea(+5%) and Japan(+5%).
- In the Pacific, revenue rose +5.5 %, marked by higher waste collection and landfill volumes.
- Revenue increased +16.1 % in
The Water Technologies activityreportedaccelerated growth of +10.7%, after +5.3 % in the first half.
Veolia Water Technologiesrecorded a similar growth as in the first half (+6.8 %) and Water Technologies Services grew strongly by +13.1 %, thanks to a good level of activity and price increases notably in chemical products.
- Revenue for the France and Special Waste Europe segment totaled €7 135 M, with organic growth of +3.2 % compared with
The main changes by business compared with combined figures at
- Water operations revenue increased +7.6 %, to €9 233 M, with good volumes in all geographies and higher tariffs.
- Technology and Construction revenue grew +9.4 %, to €4 074 M
Waste revenue increased +8.2 % at constant scope and forex to €11 864 M, benefiting from the continued high levels of recycled material prices (+2.6 % impact after +3.4 % in the first half) for papers and plastics. The upward trend in oil prices and good activity levels had a favorable impact on hazardous waste activities in
Europeand North America. Electricity revenues generated by incineration activities increased and favorable tariff revisions were recorded across all geographies (+4.3 % impact after +3.2 % in the first half). The commerce / volume effect is slightly positive. The Group continues its policy of contract selectivity and strict pricing of its offers.
Energy revenue rose +38.5 % at constant scope and forex to €5 943 M. The strong activity growth is driven by positive price effect (+30.3 % after +29.4 % in the first half), notably in
Europe, higher volumes distributed, tariff increases in Central and Eastern Europeand strong commercial development, particularly in Italyand the Middle East. The weather effect was slightly unfavorable, at -1.7 % due to a mild winter.
Strong EBITDA growth of +5.2% at constant scope and forex to €4 533 M vs. €4 311 M in 9M 2021 combined:
- The exchange rate effect was +€91 M, +2.1 %, offset by negative scope effect of -€92 M (-2.1 %).
- The strong EBITDA growth was driven by activity growth for +€57 M, by efficiency gains for €264 M, in line with the annual target of €350 M, by the merger synergies for €98 M. The synergy delivery is ahead of schedule. The annual target was reached in 9 months. The impact of price increases net of cost inflation and contract renegotiations was -€133M. The weather effect was slightly negative, -€40 M. Recycled material prices impact was favorable by +€79 M.
- As a reminder, Q3 2021 EBITDA benefited from a positive one-off of €83 M.
- In Q3 standalone, EBITDA grew by +9.4 % excluding the 2021 one-off
Very strong growth of Current EBIT, +19,4 % to 2 217 M€, at constant scope and forex.
- The exchange rate effect was +€38 M
- The strong Current EBIT growth (+306 M€) was driven by :
- Increase of EBITDA (+€222 M)
- D&A and provisions (including operating financial assets reimbursements) up €27 M.
- A favorable impact coming from industrial capital gains net of asset impairments of +€88 M vs.+€63 M in 2021.
- IFRS 2 impact of -€29 M, stable
- Share of current net income of JV and associates of +€105 M vs. +€97 M in 2021.
Net Financial Debt was €22 154 M at
30 September 2022. Free Cash Flow in Q3 generation reached €337 M.
Net financial debt is down by €351 M excluding forex compared with
30 June 2022.
- Controlled net industrial capex of €2 125 M.
- Net financial debt is down by €351 M excluding forex compared with
Guidance 2022 fully confirmed (1)(2)
- Solid organic revenue growth
- Efficiency gains above €350M complemented by €100M of synergies coming from the 1st year of integration of Suez
- Organic growth of EBITDA between +4% and +6%
- Current net income group share around €1.1bn, a growth of more than 20%, confirming the earning per share accretion of around 10% (3)
- Confirmed 2024 EPS accretion of 40%(3)
- Leverage ratio around 3x
- Dividend growth in line with current EPS growth
At constant forex and without extension of the conflict beyond the Ukrainian territory and without significant change in the energy supply conditions in
- Before PPA
- Current net income per share after hybrid costs and before PPA
As the changes in the health crisis are difficult to estimate, we draw your attention to the “forward-looking statements” that may appear in this press release and relating to the consequences of this crisis which may affect the future performance of the Company.
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.
1Main exchange rate impacts : US $ (+€256 M), Australian dollar (+€65 M), Sterling pound (+€55 M), Czech corona (+€56 M), Chinese RenMinBi (+€59 M), Polish zloty (-€36M), Hungarian forint (-€51 M), chilean peso (-€18 M), argentine peso (-€34).
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