Financial Report 2008 - Veolia Umweltservice

Management report
Management Report
With revenue of more than €10.1 billion, Veolia Environmental
Services maintained its leadership in the waste management
and recycling activities in 2008 (Waste Management realized
$13.4 billion in 2008 translated to €9.0 billion according to
the dollar rate as of December 31, 2008). Veolia Environmental
Services is present in all hazardous and non-hazardous activities,
solid and liquid waste market, with an increasing
focus on industrial customers and new municipal waste
treatment contracts.
Veolia Environmental Services
key consolidated figures
Veolia Environmental Services recorded in 2008 a significant
external growth (perimeter effect of + €932M on revenue in
2008) and a strong organic growth: in constant exchange rate
and perimeter, the 2008 revenue increased by 4.5% compared
to 2007.
However, Veolia Environmental Services’ activities suffered
from the strong fall in secondary raw materials prices which
4-Financial Report 2008 – Veolia Environmental Services
In accordance with European Parliament and Council Regulation
(EC) n°1606/2002 of July 19, 2002 and European Commission
Regulation (EC) n°1725/2003 of September 29, 2003, Veolia
Environmental Services establishes its consolidated accounts since
fiscal year 2005 in International Financial Reporting Standards
(IFRS) as published by the International Accounting Standards Board
(IASB) and adopted by the European Union. Veolia Environmental
Services anticipated the application of interpretation IFRIC 12 relating
to Service Concession Arrangements in the course of 2006. n
€Million except percentages December 2005 December December December
2005 Pro forma 2006 2007 2008
IFRS I12 IFRS IFRS IFRS
Revenue 6,579 6,724 7,446 9,195 10,132
Operating income 523 536 643 794 279
Recurring operating income 533 546 643 794 622
Recurring operating income margin 7.9% 8.0% 8.6% 8.6% 6.1%
Net financial income (139) (141) (203) (297) (370)
Net income (including minority interest) 246 255 356 321 (325)
Operating cash flow before changes in working capital 1,050 1,042 1,167 1,436 1,340
Industrial investments (740) (613) (692) (878) (1,029)
Acquisition of financial assets (62) (62) (875) (2,052) (389)
Cash flow generated by operating activities (*) 56 56 (667) (1,645) (419)
Operational capital employed (**) 5,118 5,154 5,952 7,796 7,356
Profitability before tax 10.9% 11.1% 11.6% 11.6% 8.3%
Net financial debt (***) 3,457 3,457 4,201 5,489 5,774
(*) Cash flow generated (used) by operating activities corresponds to the cash flow resulting from operating activities, after deduction of industrial investments, and
acquisition or sale of financial assets.
(**) Operational capital employed corresponds to shareholder’s equity (group and minorities) and net financial debt.
(***) Net financial debt corresponds to financial debts after deduction of cash, marketable securities and short term loans (< 3 months).
occurred in the last term of 2008. The industrial situation
has been having repercussions on all VES sites, notably in
France, in Germany and in Italy.
The operating income totalled €279 million including the
impairment losses recognized for an amount of €343 million
in respect of the goodwill in the Germany Cash Generating
Unit and the depreciation of intangible assets with indefinite
useful life recognized for an amount of €62.6 million. The