Veolia is cautious about prospects for recovery
Friday, August 6th, 2010Veolia Environnement publishes interim results up, thanks to the rising prices of raw materials recycled, but expressed caution about prospects for recovery of the waste market in the second half.
The world leader in environmental services has estimated that an operational perspective, the second half might look like in the second quarter, during which the situation has improved for his work "clean".
"The economic recovery is still extremely fragile, it is difficult to decide on the level of commodity prices (…), nor even on the level of volumes we observe in the final months of year.That is why we prefer to be cautious, however, said its chief financial officer, Pierre-François Riolacci, during a conference call.
"In activity cleanliness, it is true that we have observed a reversal between the first and second quarters," he said, mentioning in particular "a tremor on the books" in France and the United States.
"We tend to say that the second half might look like in the second quarter, in which case that we would generally quite favorable."
Veolia has reiterated that it was on the full year free cash flow positive after dividends and an increase in its recurring operating income.
The group also confirmed that it was three billion euros in sales over the period 2009-2011 – from 1.3 billion achieved in 2009 and 766 million in the first half of 2010 – and was continuing the implementation of a savings program overall 250 million for 2010.
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Pierre-Francois Riolacci said the group would "do everything to exceed" its savings target and that the transfers could exceed one billion euros this year.
In the first six months of the year, the savings program has contributed to the growth of cash flow (CFO) operational Veolia up to 132 million euros.
The Chief Financial Officer also considered that the proposed merger with Transdev in the passenger could be completed by year end or early 2011.
"The most likely scenario (from the IPO of the new entity) is the second half of 2011.This is our central scenario, "he said.
Veolia in the first half net profit group share of 374 million euros (+69.9%), an operational CFO 1,885,000 (+0.2% at constant exchange rates), operating profit of 1.125 million ( +7.9% at constant exchange rates) and a turnover of 17.177 million (-3.3% at constant exchange rates).
According to the consensus reached by the editor of Reuters, analysts on average expected a net profit of 346 million euros, an operating cash flow of 1.908 million and a turnover of 16.924 million.
Recurring operating income of Veolia appears in turn to 1.078 million euros at 30 June, an increase of 6.6%.
At 9:30, the track was down 1.84% at 21.30 euros while the CAC 40 gained 0.69%. Analysts based in London, "the weak economy continue to weigh on the figures in the second half."
The group's net financial debt stood at 16.027 million euros at June 30th against 15.127 million in late 2009, largely because of an unfavorable effect of foreign exchange of 674 million.