VINCI - 2005 annual report

ENERGY / BUSINESS REPORT
Strong responsiveness
on constantly changing markets
Against the backdrop of a slack economy, especially in manufacturing industry,
across much of Europe, VINCI Energies recorded a signifi cant increase in
its business activity in many of the countries where it operates - especially in
France, Northern Europe and Spain - while maintaining a high level of operating
profi tability (5% of revenue). This performance confi rms the vitality of the
VINCI Energies management model and the effectiveness of its development
strategy combining organic growth and acquisitions in Europe.
Revenue
+5.1 %
Operating profi t
from ordinary activities
+8.5 %
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VINCI 2005 ANNUAL REPORT
In France, VINCI Energies business units recorded organic growth of 7%.
It was driven, notably, by the booming telecommunications infrastructure
market and by the high level of activity in the service sector. In industry, efforts
to adapt offerings made it possible to achieve higher activity levels than
originally forecast on a slack market.
In the Netherlands and the United Kingdom, where markets were relatively
fl at, business activity and earnings made considerable headway. In Sweden, the
restructuring carried out in 2004 bore fruit as Emil Lundgren’s return to profi t
was confi rmed. In Spain, Spark Iberica generated revenue up 10% to nearly €90
million, while maintaining its operating profi t contribution at a high level.
The spectacular turnaround of the German subsidiaries was confi rmed
in 2005, especially in the insulation business lines. A rigorously selective ordertaking
and earnings improvement policy resulted in a revenue contraction that
was largely offset by acquisitions (Lagrange, NK Networks & Services); business
activity in Germany as a whole generated pre-tax earnings of 4.5% of revenues,
a level very close to the Group average.
In Central and Eastern Europe, VINCI Energies entities were brought together
in a common management structure so as to introduce a coordinated approach
to these new markets and their many opportunities for growth.
TMS, the Austrian business unit specialising in automated production systems
for the automotive industry, was restructured in 2005. The Spanish and
South African subsidiaries and the wire-guided trolley subsidiary were divested.
Activity was discontinued in Brazil and cut back in Austria. The remaining
business activities in Austria, Germany and the Czech Republic were divested
in February 2006.
Elsewhere, VINCI Energies continued its external growth momentum.
16 companies with combined revenues of €160 million on an annualised