SUEZ ENVIRONNEMENT- Financial results - 1st Quarter 2013

           SUEZ ENVIRONNEMENT- Financial results - 1st Quarter 2013

PR Newswire

PARIS, April 22, 2013

PARIS, April 22, 2013 /PRNewswire/ --

1^stQUARTER 2013

STABLE OPERATING PERFORMANCE IN A DIFFICULT ECONOMIC CONTEXT IN EUROPE

  +Revenue: down at €3497m, -2.6%
  +EBITDA: €570m, +0.8%
  +EBITDA margin: 16.3%, up compared to Q1 2012 (15.8%)

                                                Gross
                                                          Organic   Change in
    In MEUR        31 March 2012 31 March 2013  change    change      scope

    Revenue            3,591         3,497      -2.6%      -2.6%      +0.2%
    EBITDA              566           570       +0.8%      0.0%       +0.5%
    EBITDA/Revenue     15.8%         16.3%

  +For the 1^stquarter of 2013, SUEZ ENVIRONNEMENTreported revenuesdown by
    -2.6% at €3,497m, or stable excluding the impact of Melbourne
    plantconstructioncompletion in December 2012. The Water Europe and
    International divisions reported organic growth, respectively +3.4% and
    +5.0% (excluding the Melbourne plant completion). The Waste Europe
    division is down by -5.3% linked to a reduction of the treated volumes.
    SUEZ ENVIRONNEMENT continues its commercial development with the gain of
    contracts such as Merseyside (United Kingdom), Poznań (Poland), Tours
    (France) in waste, Rhône Ventoux (France) in water, or finally New Delhi
    (India).
  +EBITDAstands at €570m, up +0.8% or stable in organic terms. Despite a
    difficult macro-economic context in Europe, the EBITDA margin stands at
    16.3%, improving versus Q1 2012. This operating performance confirms the
    relevance of the strategic choices made by the Group, both in terms of
    business model and cost reductions already achieved and further
    strengthened since the second half of 2012.
  +The Group's netfinancialdebt(NFD)standsat €7,616m. It includes
    negative marked-to-market and forex effects. In Q1, the NFD/EBITDA ratio
    is in line with the objective of around 3 times.
  +Commenting on the first quarter 2013 results, Jean-Louis Chaussade, Chief
    Executive Officer, stated:"Our Group's performance remains good despite
    aneconomic contextthatisparticularlydifficult in Europe inthe
    beginning of 2013.This is the result, on one
    hand,ofanoptimizedmanagement of our assetswith afurther reinforced
    cost controland, on the other hand,the relevance of our strategic
    choices, with the development of four prioritiesaxesfor growth, which are
    smart water, waste recovery, international development and industrial
    water.

The Water Europe business has increased thanks to contract gains and renewals,
and the steady development of new business activity. International Division
maintains a dynamic growth in Asia and Australia. However, Waste Europe
Division has been affected by a decrease in treated volumes, a direct
consequence of the decline of industrial production in Europe.

SUEZ ENVIRONNEMENTpursues its target to improve its operational performance
on a constant basis, while preparingthe Groupfor the future: the growthof
the Groupis based on long-termdrivers, high-quality assets, and a clearly
defined development strategy."

BREAKDOWN OF ACTIVITY AS AT END MARCH 2013

                                                  Gross   Organic
                                                                    Change in
    Revenue       31 March 2012[1] 31 March 2013  change   change     scope
    In MEUR
    Water Europe       1,008           1,041      +3.3%    +3.4%      -0.4%
    Waste Europe       1,658           1,583      -4.6%    -5.3%      -0.1%
    International      923[2]           870       -5.7%    -4.1%      -0.2%
    Other[3]             3               2          -        -          -
    TOTAL              3,591           3,497      -2.6%    -2.6%      +0.2%

On March 31^st, 2013, SUEZ ENVIRONNEMENT reported revenues of €3,497m, a gross
change of -2.6% (-€95m) overall compared with March 31^st, 2012. This breaks
down as follows:o:

  +Organic variation of -2.6% (-€93m):

       oRevenue in the Water Europe division was up (+€34m, +3.4%) for both
         Lyonnaise des Eaux and Agbar, benefiting from rising prices, and the
         development of new business activities.
       oRevenue in the Waste Europe division was down (-€89m, -5.3%). It was
         affected by a drop in the treated waste volumes and a fall of
         secondary raw material prices.
       oRevenue in the International division was down (-€38m, -4.1%) but up
         +5.0% excluding the impact of Melbourne plant construction completion
         in December 2012.

  +Scope effect of +0.2% (+€9m):

       oWater Europe: -€4m
       oWaste Europe: +€15m
       oInternational: -€2m

  +Unfavourable exchange rate impact of -0.3% (-€11m), mainly due to the
    depreciation of the Australian dollar (-€7m) and the pound sterling (-€4m)
    against the euro.

  +In the first quarter of 2013, SUEZ ENVIRONNEMENT posted 30% of its revenue
    outside Europe.

  +SUEZ ENVIRONNEMENT maintains its objectives^[^4]. and remains fully
    mobilized to achieve its 2013 guidance

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1. Following the new management organisation, Water and Waste activities
located in Central Europe that were previously included in the International
division have been regrouped under the Water Europe and Waste Europe
divisions. USG, previously included in the International division is now under
the Water Europe division.

2. Includes €84m of revenue for Melbourne desalination plant construction
contract, finalized in December 2012.

3. R+i Alliance, HQ

4. Assuming GDP growth of 0% in Europe in 2013, within a stable accounting and
tax framework and at constant exchange rates



PERFORMANCE BY DIVISION

WATER EUROPE

    In MEUR 31 March 2012 31 March 2013 Gross change Organic change Change in scope
    Revenue     1,008         1,041        +3.3%         +3.4%           -0.4%

The Water Europe division posted organic growth of +3.4% (+€34m).

  +Lyonnaise des Eaux grew organically by +4.3% (+€21m).

In France, growth was driven by a positive price effect with the rise in price
indices, the development of the new businesses and the increase of works
activities. Volumes were down, in line with the expected trend. During Q1, the
Group won wastewater contracts of Douai (€73m, 11 years), Orange (€17m, 12
years) and Rhône Ventoux (€152m, 12 years for water and 8 years for
wastewater).

  +Agbar grew organically by +2.6% (+€13m).

Business is up, with favorable price impacts in Spain and Chile. However,
volumes are down in Chile, as a result of the historical levels of rainfall
seen in Q1 2013. Volumes are also down in Spain. Moreover, Agbar continues to
develop its technologies and services business, with contracts gains in Madrid
or Valencia.

WASTE EUROPE

    In MEUR 31 March 2012 31 March 2013 Gross change Organic change Change in scope
    Revenue     1,658         1,583        -4.6%         -5.3%           +0.9%

During the 1^st quarter of 2013, the Waste Europe division was down by -5.3%
(-€89m) in organic terms. It was affected first by a negative volume effect
result of a particularly difficult macro-economic environment, adverse weather
conditions, and a negative "working days" effect, as well as by a negative
commodities price effect.

  +SITA France posted an organic variation of -6.3% (-€57m).

This reduction came essentially from the sorting and recycling business, with
the fall in secondary raw material prices. Services and other treatment
activities were also down. During the quarter, SITA won collection contracts
of Reims (€5m, 3 years) and Dreux (€12m, 6 years) and renewed the contract of
Tours (€20m, 4 years),

  +The United Kingdom/Scandinavia zone grew organically by +1.3% (+€4m).

In the UK, treatment activities were up thanks to the optimization of
Newcastle EfW plant. Moreover, the construction of energy from waste units in
Suffolk and South Tyne & Wear (PFI contracts^[5]) is on schedule; they will be
operational in 2014. Elimination is also up, benefiting from a positive price
effect with landfill tax rise. SITA UK has signed the treatment contract of
Durham (€130m, 8 years) and the Cornwall revision contract (€1.4billion, 30
years). SITA UK has also just been selected as the preferred bidder for a
30-year contract worth €1.4billion from the Merseyside Recycling and Waste
Authority in the UK.

  +The Benelux/Germany zone posted an organic variation of -9.7% (-€39m).

This slowdown essentially came from Services affected by lower volumes.
Sorting and recycling is also down, due to negative price and volume effects.
However, the energy recovery business was up thanks to strong volumes. In
Belgium, SITA was awarded municipal contracts in Schaerbeek and Stad Turnhout,
and industrial contracts with Total and Goodyear.

  +The Central Europe zone reported organic growth of +6.2% (+€3m).

Growth came from Services in Poland and the Czech Republic, which account for
the main part of revenue in this zone. During the quarter, SITA signed the
construction and operation contract for an energy from waste plant in Poznań,
the largest tender for a public-private partnership ever made in Poland
(€850m, 25 years).

INTERNATIONAL

    In MEUR 31 March 2012 31 March 2013 Gross change Organic change Change in scope
    Revenue      923           870         -5.7%         -4.1%           -0.2%

The International division was organically down by -4.1% (-€38m) or +5.0%
excluding the impact of the completion of the construction of Melbourne plant.

  +Asia-Pacific posted organic growth of +8, 0% (+€24m) sustained by growth
    in Australia thanks to positive price effects in the waste business , and
    in China, in both activities with strong growth in volumes. In China, the
    Group won two management and development contracts for three waste
    transfer stations in Hong Kong (€220m, 10 years).

  +Africa/Middle East experienced an organic slowdown of -2.8% (-€4m).

This downturn came mainly from a decline in volumes in Morocco following
adverse weather conditions.

  +North America posted organic growth of +0.1%.

The regulated activities of United Water benefited from price increases
obtained in particular in New York and Idaho. However, the business was
impacted by lower volumes. Non-regulated activities remain stable.

  +Degrémont posted growth of +8.5%, excluding the impact of the Melbourne
    contract completed in December 2012. This growth comes from the
    development of the industrial client basis and from municipal activities
    in Middle East, India and Australia. Over the quarter, Degrémont signed
    notably two contracts in India for the design, construction and operation
    of wastewater treatment plants (€41m), and four wastewater treatment
    renovation contracts in Africa (€40m), which demonstrates dynamic business
    activity.

NEXT COMMUNICATIONS

  +23 May 2013: Annual General Meeting of Shareholders

  +30 May 2013: Payment of dividend of €0.65 per share

  +31 July 2013: Publication of 2013 half-year results (Telephone conference)

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5. Private Finance Initiative

APPENDIX

Geographical breakdown of revenue

    Revenue            31/03/2012        31/03/2013     Total change
                     MEUR  % of total  MEUR  % of total  MEUR    %
    Europe          2,481    69.1%    2,437    69.7%     -43   -1.7%
    France          1,273    35.4%    1,268    36.3%      -5   -0.4%
    Spain            335      9.3%     346      9.9%      11   +3.3%
    United Kingdom   202      5.6%     214      6.1%      12   +6.1%
    Other Europe     671     18.7%     609     17.4%     -62   -9.2%
    North America    196      5.5%     187      5.4%      -9   -4.5%
    Australia        308      8.6%     239      6.8%     -70   -22.6%
    Sub-total       2,985    83.1%    2,863    81.9%     -122  -4.1%
    Rest of world    606     16.9%     634     18.1%      28   +4.6%
    TOTAL           3,591    100.0%   3,497    100.0%    -94   -2.6%

SUEZ ENVIRONNEMENT

Natural resources are not infinite. SUEZ ENVIRONNEMENT (Paris: SEV, Brussels:
SEVB) and its subsidiaries deal with the challenge of protecting resources by
providing innovative solutions to millions of people and the industrial
sector. SUEZ ENVIRONNEMENT supplies drinking water to 97m people, provides
waste water treatment services for 66m people, and collects the waste produced
by 50m people. SUEZ ENVIRONNEMENT has 79,549 employees and, with its presence
on five continents, is a world leader exclusively dedicated to water and waste
management services. In 2012, SUEZ ENVIRONNEMENT, a subsidiary 35.7% owned by
GDF SUEZ, posted revenues of €15.1billion.

Disclaimer

This document includes unaudited financial data. The aggregates shown are
those customarily used and communicated to the markets by SUEZ ENVIRONNEMENT.

"This communication includes forward-looking information and statements. This
forward-looking data is based on assumptions, financial projections, estimates
and statements regarding projects, objectives and expectations for
transactions, future products and services, and future performances. No
guarantee can be given that these forecasts will be met. Investors and holders
of SUEZ ENVIRONNEMENT Company shares are informed that these forward-looking
information items and statements are subject to a number of risks and
uncertainties, which are hard to predict and are generally beyond SUEZ
ENVIRONNEMENT Company's control, and which could cause the results and
outcomes expected to differ materially from those expressed, suggested or
predicted in forward-looking statements and information. Such risks include,
but are not limited to, those developed or identified in public documents
filed with the Autorité des Marchés Financiers (AMF). The attention of
investors and holders of SUEZ ENVIRONNEMENT Company shares is drawn on the
fact that the materialization of all or a portion of these risks is likely to
have a material unfavourable impact on SUEZ ENVIRONNEMENT Company. SUEZ
ENVIRONNEMENT Company is not under any obligation, and does not commit to
publishing changes to or updates on these information items and
forward-looking statements under any circumstances. Additional detailed
information on SUEZ ENVIRONNEMENT Company is available on the website
(http://www.suez-environnement.com).This document does not amount to an offer
to sell or to a solicitation to buy SUEZ ENVIRONNEMENT Company securities in
any jurisdiction."

This press release is also available at http://www.suez-environnement.com

SOURCE SUEZ ENVIRONNEMENT

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