A player in sustainable development - Dalkia

STOCK MARKET
A growth stock off ering strong visibility
Stock market sentiment, more uncertain since summer 2007, has paved the way for an increase in volatility.
Against this backdrop, the Veolia Environnement stock has far outperformed the Paris exchange’s CAC 40,
benefi ting from its double status as a growth stock and a defensive stock.
Return of stock market volatility
After rising for four straight years,
the Paris exchange’s CAC 40 inched up
in 2007 by just 1.3%. The US subprime
mortgage crisis has rocked investor
confi dence in the effi ciency of the
international fi nancial system. In Europe,
the MSCI Europe index stagnated
in 2007, refl ecting the contrasting
developments in the main European
indices, with performances ranging from
-6.9% for Milan’s MIB 30 to +22.3% for
Frankfurt’s DAX 30.
Veolia Environnement stock
held up well in 2007
Against this backdrop, the Veolia
Environnement stock gained 8.8%
in 2007, closing the year at €62.45
compared with €57.42 at December 29,
2006 (1) . Veolia Environnement’s intrinsic
qualities, such as the recurrence and
visibility of its income from long-term
contracts, the steady increase in
20 2007 ANNUAL REPORT VEOLIA ENVIRONNEMENT
dividends paid out, its positioning
in fast-growing markets as well as its
growth prospects, mean it is now
a defensive stock as much as a growth
stock.
Capital increase over-subscribed
Confi dent in the upside potential of the
global environmental services market,
Veolia Environnement launched
a €2.6 billion cash capital increase with
preferential rights in June 2007, on the
basis of one new share for eight existing
shares at a unit price of €49.70 per share
(€5 par value and €44.70 issuance
premium).
With this rights issue, the company has
improved its fi nancial fl exibility to be
able to seize growth opportunities in its
core business. Despite the tough stock
market context, its capital increase was
over-subscribed 1.5 times, illustrating
shareholders’ high level of confi dence
in the company.
BREAKDOWN OF VEOLIA ENVIRONNEMENT’S SHARE
OWNERSHIP AT DECEMBER 31, 2007
Other institutional investors
Capital Research &
Management Company
Caisse des dépôts
Natixis Asset Management
Groupama
EDF
Treasury stock
Individual shareholders
Employee shareholders
49%
(1) After taking into account all of Capital
Research’s entities.
1%
7%
12% (1)
4%
4%
10%
6%
7%
THE VEOLIA
ENVIRONNEMENT STOCK
Stock market listings
Paris, New York
Codes (Paris)
ISIN: FR 0000124141-VIE
Reuters: VIE.PA
Bloomberg: VIE.FP
Codes (New York)
CUSIP: 92334N103
NYSE Symbol: VE
Number of shares outstanding
470,719,806 at December 31, 2007
Inclusion in stock market indexes
Veolia Environnement has been part
of the CAC 40 index since August 2001.
It is a socially responsible investment;
the stock was again selected in stock
market indexes taking into account
ethical, environmental and social criteria:
the Dow Jones Sustainability Index (DJSI)
and the FTSE4Good index when they
were updated in September 2007.
It is also included in the ASPI Eurozone
(Advanced Sustainable Performance
Index), an extra-fi nancial international
index that assesses the social
and environmental performance
of companies.
The quality of the social and
environmental information released by
Veolia Environnement is acknowledged
by independent reference organizations.
In its 2007 classifi cation, the CFIE
(“French corporate information center”)
ranked Veolia Environnement fi rst for
the quality of its 2006 sustainable
development report published in
response to the requirements of France’s
NRE, or new economic regulations, law.
(1) Adjustment in closing prices in previous years,
following the €2.6 billion cash capital increase
with preferential rights fi nalized in July 2007.