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VE: Veolia Environment

VE: Veolia Environment . Business Segments. Water management Waste management Energy management Transport. Water Management.

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VE: Veolia Environment

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  1. VE: Veolia Environment

  2. Business Segments • Water management • Waste management • Energy management • Transport

  3. Water Management • The division has more than 150 years of experience managing public water and wastewater services under public-private partnerships. Its expertise also includes the capabilities of its research and development teams and its subsidiary Veolia Water Solutions & Technologies, which continually develops analytical, treatment, wastewater and recycling techniques spanning the entire water cycle. • While organic revenue (within France) growth for the segment was only 3.3% Veolia Water solutions & Technologies, revenue increased 19% • Operating in 68 countries and serving a population of 225 million people, two-thirds of Veolia Environnement’s revenue is derived from local public authorities. The water services in Berlin (Germany) and Shanghai (China), waste management services in Alexandria (Egypt), transportation in Las Vegas (United States) and district heating system management in Lodz (Poland) are global benchmarks.

  4. Veolia Water manages water and wastewater services on behalf of local public authorities and companies; it also designs the technological solutions and builds the infrastructure needed to provide such services. • Its business activities cover the entire water cycle: raw water withdrawal; production and distribution of drinking water and industrial water; and collection, transportation and treatment of wastewater to recycle it or return it to nature. • World-recognized expertise in seawater desalination • The division selected the MED(1) thermal process for the Jubail plant in Saudi Arabia (800,000 cu.m/day of desalinated water) and the reverse osmosi process for the plants it will build and operate in Campo de Dalias (Spain), Sydney(Australia) and Sur (Oman). In Fujairah(UAE), it has chosen to implement its exclusive hybrid desalination solutions, which combines the MED thermal process and the reverse osmosis process (590,000 cu.m/day).

  5. Veolia Water • Most Recent Contract: • Abu Dhabi and Al Ain Wastewater Treatment Facilities • Largest wastewater contract in the Middle East to date • Estimated revenue: $534 million • Timeframe: 25 years Recent News In the Press: July 31, 2008: Veolia Water signed a contract with Abu Dhabi Water and Electricity Authority for the financing, design, construction and operation of two new wastewater treatment facilities in Abu Dhabi and Al Ain. This is the biggest wastewater contract to date to be signed in the Middle East and is estimated to be worth about $534 million over a 25 year period in consolidated revenue. The contract is associated with Belgian-based Besix, which will carry out the civil engineering part of the construction as well as be involved in one-third of the operating services. http://www.veoliaenvironnement.com/en/information/press-releases/press-release-details.aspx?PR=788

  6. Environmental Services and Waste Management. • Veolia Environmental Services operates all around the world in the management of liquid and solid, non-hazardous and hazardous wastes (with the exception of nuclear waste). Its services range from waste collection and transfer to recovery and recycling on behalf of companies and public authorities. The division also provides cleaning services: pipe systems maintenance, street cleaning, industrial cleaning, equipment and production • tool maintenance, and soil remediation. Its waste treatment methods include various recovery methods: materials recovery and recycling, agricultural recovery and energy recovery.

  7. This Year’s Acquisitions Scrap metal now accounts for over 40% of steel production in Europe and more than 57% in North America. Production in Europe of recycled aluminum has tripled in 20 years. As for recovered cellulose fibers, their use in global paper production hit the 50% mark in 2007. Secondary raw materials are therefore now indispensable in the manufacture of a growing number of products. They will become increasingly so as demand becomes more infl-uencedby globalization, primary raw materials become scarcer and more expensive, and recycling technologies become more efficient. Veolia Environmental Services’ strengthened positions in the paper and cardboard and scrap metals markets are an integral part of its sustainable strategy for “turning waste into a resource.”

  8. Recent News Veolia Environment • Most Recent Contract: • YongKangMuniciple Waste-to-Energy Plant in TaiNan • Estimated contract value: $86 million • Timeframe: 20 Years • 37% of Waste-to-Energy in Taiwan • Innovation: • First biomethane fuel facility in France • Renewable, positive carbon balance energy source • Harvested from non-hazardous, existing landfill in France In the Press: April 10, 2008: Veolia Environment and its local Taiwan Cement Corporation was awarded a 20-year operation and maintainance contract for the YongKangmuniciple waste-to-energy plant in TaiNan County, Taiwan. The contract has an estimated total revenue of $86 million. With this contract, Veolia Environment now manages 37% of the waste-to-energy plants in Taiwan. http://www.veoliaenvironnement.com/en/information/press-releases/press-release-details.aspx?PR=760 June 24, 2008: Veolia Environment created the first French facility to produce biomethane fuel harvested from its non-hazardous landfil in Claye-Souilly, France. Biomethane fuel represents, from an environment standpoint, a positive carbon balance (in comparison with Natural Gas for vehicles), and, non being a fossil fuel, can be regarded as a renewable energy source. http://www.veoliaenvironnement.com/en/information/press-releases/press-release-details.aspx?PR=784

  9. Energy Management Veolia Energy (Dalkia) • Energy and environmental optimization Again recorded double-digit growth between 2006 and 2007. Revenue rose 12.7% to €6.9 billion and the division continued its vigorous external growth.

  10. This Year’s Acquisitions • Heating and cooling networks • Dalkia has extended its offer to cover all medical support services. Its Sterience subsidiary takes care of sterilizing instruments for healthcare institutions. For the Riuniti hospitals in Trieste, Italy, Dalkiais in charge of building maintenance, technical systems management and fuel supply for the standby generators. It provides the same services for six health authorities in Cagliari.

  11. Recent News Veolia Energy Services (Dalkia) • 2008: • February, 2008: Dalkia expands operations in Poland • Acquired Praterm, a Polish district heating company • Estimated 2008 revenue: $81 million • Dalkia already owned Poznan and Lodz, two of Poland’s largest existing heating networks • 2007: • May 2007: Dalkia signs its first heating contract in China • Jiamusi, Heilongjiang Province, China • Timeframe: 25 years • Estimated aggregate revenue: $953 million • Later in May, 2007: Dalkia expands operations in China • Majority interest in YangGuang, giving Dalkia control over heating network of southeast Darbin, capital of Heilongjiang • Estimated Revenue of $28 million in the first year alone. • June: Acquisition talks start with Thermal North America, Inc. • Largest portfolio of heating and cooling networks in the USA • Most notably: Boston, Philadelphia, Baltimore, Atlanta, Kansas City, Trenton, St Louis, Oklahoma City and Tulsa and several cooling networks in Las Vegas and Los Angeles • TMA, Inc had 2007 revenue of $425 million

  12. Transportation • Veolia Transportation comprises 17% of the business and is responsible for over 8.2 billion USD in revenue. • They operate transportation systems in over 30 countries and contract with over 5,000 local authorities. • Bus services are the core of the transportation service: • Bus lines in 60 French cities and the #1 private operator in the Paris suburbs • 17 regional contracts in Belgium • Las Vegas: In 15 years ridership has quadrupled to 60 million passengers • Airport shuttle services at two major Swedish airports • Commuter rail is a growing segment: • NordWestBahn in Germany carries 21 million people a year. • A commuter rail between Miami’s airport and Palm Beach • The airport MetroLink in Las Vegas • Boston’s light rail system with 150,000 passengers a day. The contract was renewed in 2007. • Commuter trains in Auckland, NZ • Urban metro systems are another growing sector: • Stockholm, Sweden has 800,000 passengers a day • A metro in Seoul set to launch in 2009 • A metro in Mumbai set to launch in 2009, the first in Mumbai • Other sectors: • Ferry services • Freight transportation • Both are mostly concentrated in western Europe

  13. The leading private European public transportation operator. • Veolia Transport is well established n Europe and North America, where it develops and operates urban mobility solutions based on buses, light rail, metros and taxicabs, as well as regional public transportation using coaches, trains and ferries, under public service management contracts. The division employs information and assistance services to help passengers organize their trips. For industrial companies in Europe, Veolia Transport offers rail freight services with related logistics. • Veolia Transport works with its clients to combat air pollution, integrate transit into urban planning, improve their systems’ accessibility and enhance safety. Its sights are set on inventing the mobility of today and of the future so that it can assist in and prepare for its clients’ growth.

  14. Recent News Veolia Transport • Recent Contracts: • Bilbao, Spain • Awarded contract to manage municiple bus system • $447 million over 8 years • Bremen, Germany • Contracted to manage S-Bah regional Express Train starting in 2010 • $773 million over 11 years • Veolia group had 58.4% revenue growth in Germany between 2007 and 2008 In the Press: June 6, 2008: Veolia Transport was awarded the contract to manage the municiple bus system for Bilbao, Spain. The estimated cumulative revenue for the first 8 years of this contract is $447 million. http://www.veoliaenvironnement.com/en/information/press-releases/press-release-details.aspx?PR=780 September 2, 2008: NordWestBahn (A Veolia Transport subsidiary) has been awarded the contract to manage the whole of the planned regional express strain system (S-Bahn) which will link the states of Bremen and Lower Saxony, Germany. Starting in 2010, the contract is estimated to generate a cumulative revenue of $733 million over an 11-year period. http://www.veoliaenvironnement.com/en/information/press-releases/press-release-details.aspx?PR=792

  15. Revenue Breakdown

  16. Revenue Breakdown

  17. Comparative ChartStock Price Over Past 3 Years

  18. Why the recent dip? UBS citing the amortization of goodwill and a negative currency effect as reasons for operating income coming in lower than expected But What’s Goodwill? Goodwill in financial statements arises when a company is purchased for more than the book value of the company. The difference between the purchase price and the sum of the fair value of the net assets is by definition the value of the "goodwill" of the purchased company. The acquiring company must recognize goodwill as an asset on its financial statements and present it as a separate line item on the balance sheet, according to the current purchase accounting method. In this sense, goodwill serves as the balancing sum that allows one firm to provide accounting information regarding its purchase of another firm for a price substantially different from its book value. Goodwill can be negative, arising where the net assets at the date of acquisition, fairly valued, exceed the cost of acquisition What this means? We believe that that this company is now undervalued. It has lost 6 Billion of market capitalization in just 3months.

  19. Profitability

  20. Growth

  21. Where we’re at. Average Analyst Target Price: 71.03 PE on CY Estimate: 13.90 http://finance.google.com/finance?q=ve Value! EPS Growth. Dividend Growth. Revenue Growth.

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