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Veolia Environnement: First Half 2013 Results1 



  Veolia Environnement: First Half 2013 Results1 

          Continued steady implementation of the Company’s strategy

          Adjusted operating income^2 increased 28% to €539 million

Adjusted net income of €131 million compared to €18 million in first half 2012

                          2013 objectives confirmed

Business Wire

PARIS -- August 5, 2013

Regulatory News:

Veolia Environnement (Paris:VIE):

  * Performance in line with the path to recovery and profitable growth:

       * Improvement in the year-over-year revenue trend in Q2 2013 (-1% in Q2
         after -3% in Q1 2013 at constant consolidation scope and exchange
         rates)
       * Resilience of Q2 2013 adjusted operating cash flow: +0.5% at constant
         exchange rates, excluding restructuring costs, after a 7.0% decline
         in Q1 2013
       * Adjusted operating income increased 28% to €539 million
       * Adjusted net income was €131 million versus €18 million for the first
         half of 2012

  * Positive impacts of the implementation of the Company’s transformation
    plan:

       * Reduction in net financial debt to €10.0 billion at June 30, 2013
       * Net cost reductions of €74 million in the first half of 2013
       * New geographical organization since July 2013
       * Continued commercial success with industrial clients and in growing
         geographies
       * Reinforcement in progress of Veolia operations in Latin America

Key first half 2013 figures^3

Revenue: €11.1 billion                      Divestments: €292 million
Adjusted operating cash flow: €930          Positive Free Cash Flow: +€556
million                                     million
Adjusted operating income: €539 million     Net financial debt: €10.0 billion
Adjusted net income: €131 million           Adjusted net financial debt: €6.7
                                            billion
Net income: €4 million                      Adjusted leverage ratio: 3.1x

Antoine Frérot, Veolia Environnement Chairman and Chief Executive Officer,
commented: “First half 2013 results reflect the initial impacts of the
Company’s strategy that has been in place for the last 18 months. They show
that the Company is fully on the charted path to recovery and profitable
growth. Operational risk management due to refocusing and productivity efforts
contributed to a significant improvement in adjusted operating income, which
increased 28%, despite an unfavorable economic environment. On a commercial
basis, we have been successful, with several significant contracts awarded to
Veolia within our targeted development areas, in particular with industrial
clients. In view of the progress achieved during the first half of 2013, we
are confident in our ability to achieve our medium- and long-term objectives.”

  * Revenue of €11,074 million compared to re-presented €11,448 million for
    the first half ended June 30, 2012

       * Water: revenue declined 3.7% at constant consolidation scope and
         exchange rates to €5,000 million

The Operations business was stable at constant consolidation scope and
exchange rates: favorable indexation, but temporary slowdown in construction
activity in certain contracts, lower volumes and contractual erosion in
France. Good performance in Central and Eastern Europe operations as well as
due to new contracts commencing in the United States.

Technologies and Networks (-10.4% at constant consolidation scope and exchange
rates): Completion of Design & Build contracts outside of France and
unfavorable weather impacts in France. Bookings increased 23%.

  * Environmental Services: revenue declined 3.0% at constant consolidation
    scope and exchange rates to €3,985 million. Marked improvement in Q2
    year-over-year trend (-1.4% in Q2 versus -4.6 % in Q1).

Continued unfavorable impact related to prices and volumes of recycled raw
materials

Impact of volumes / activity levels reduced to -1.1% in the first half of 2013
compared to -3.5% in Q1.

  * Energy Services: revenue increased 4.4% at constant consolidation scope
    and exchange rates to €1,972 million

Higher energy prices and favorable weather effects

  * Adjusted operating cash flow of €930 million compared to re-presented
    €1,006 million for the half year ended June 30, 2012

       * Water: decline of 3.2% at constant exchange rates, with stability in
         the Operations business
       * Environmental Services: decline of 6.7% at constant exchange rates,
         including trend improvement in Q2
       * Energy Services: quasi-stable despite the end of gas cogeneration
         contracts

  * Significant growth in adjusted operating income: 29.2% growth at constant
    exchange rates to €539 million, versus re-presented €419 million for the
    half year ended June 30, 2012 due to:

       * Significant contribution of joint ventures and associates, mainly due
         to Dalkia International, including a favorable base effect from €89
         million in write downs of receivables and accrued expenses in Italy
         in the first half of 2012
       * The positive impact of the cost reduction plan, net of implementation
         costs
       * The benefit of the closure of the defined benefit pension plan for
         senior executives

  * Adjusted net income attributable to owners of the Company: €131 million in
    the first half of 2013 compared to re-presented €18M for the same period
    ended June 30, 2012

       * Adjusted net income benefitted from the significant increase in
         adjusted operating income.
       * Net income for the first half of 2013 amounted to €4 million compared
         to €162 million for the same period ended June 30, 2012, and was
         impacted by goodwill impairments in the Environmental Services
         division in Germany, restructuring charges associated with the
         voluntary employee departure plan at VE SA and costs associated with
         the early buyback of bonds in order to optimize the Company’s cash
         position.

  * Reduction in net financial debt: €10.0 billion at June 30, 2013 versus
    re-presented €10.8 billion at December 31, 2012. Adjusted net financial
    debt amounted to €6.7 billion at June 30, 2013 versus re-presented €7.8
    billion at December 31, 2012.

                          FIRST HALF 2013 RESULTS^4

After a difficult start to the year, operating performance was resilient,
though contrasted in the first half of 2013, despite lower activity levels in
Europe.

The Group accelerated the implementation of its strategy through a
transformation and cost reduction plan and a vast program to optimize its
asset portfolio.

Transformation and cost reduction plan

On July 8, 2013, as part of the transformation of Veolia Environnement, the
new organizational structure of the Group was announced, continuing the
strategy implemented for the last two years to establish Veolia Environnement
as "The Industry Standard for Environmental Solutions" due to its expertise in
major environmental issues in the Water, Environmental Services and Energy
Services sectors.

This new organization is based on two major advances: a country-based
organization for Water and Environmental Services placed under the authority
of a single director per country and the creation of two new functional
departments: one dedicated to Innovation and Markets, the other to Technology
and Performance.

With the exception of globally integrated French activities and Dalkia,
business operations will now be brought together within each country, with
country directors in charge of both the Water and Environmental Services
businesses. The integrated and direct Group management, under the operational
authority of the Chief Operating Officer, will be organized around nine
regions regrouping several countries, representing the first level of resource
allocation.

A specific entity will group together businesses with global specialties and
primarily global markets.

Dalkia, a joint subsidiary of Veolia Environnement and EDF, will retain its
current organization for now, but will eventually be included in the new
organizational structure.

Over and above the annual Efficiency plan, the 2015 net cost reduction
objective (Convergence Plan) was increased in May 2013 to €750 million from
the prior €470 million target, compared to 2011. This €280 million increase
breaks down as follows: €70 million in respect of increased mutualization and
IT efforts, €100 million in respect of purchasing and €110 million associated
with transversal efficiency projects in the businesses and headquarters.

Asset portfolio optimization policy

The Group continued to implement its strategy with in particular:

  * the divestiture of Eolfi’s European activities on February 28, 2013,
    following the signature of a memorandum of understanding with Asah on
    January 21, 2013, for a share value of €23.5 million; and
  * the divestiture of the Veolia Water subsidiary in Portugal (Compagnie
    Générale des Eaux du Portugal – Consultadoria e Engenharia) on June 21,
    2013, to Beijing Enterprises Water Group, for an enterprise value of
    approximately €91 million; and
  * the initial public offering on the Oman stock exchange of 35% of the
    shares of Sharqiyah Desalinisation Company on June 29, 2013. Following
    listing, this entity is equity accounted as of June 30, 2013. The impact
    on Group net financial debt is -€88.9 million.
  * Overall, financial divestitures (enterprise value) and industrial
    divestitures totaled €292 million in the half-year ended June 30, 2013.

In addition, further divestment transactions are expected to be completed
before December 31, 2013. These activities are classified in discontinued
operations as of June 30, 2013:

  * on March 7, 2013, an agreement was signed with the British investment fund
    Actis for the sale of water, wastewater and electricity concession
    activities in Morocco;
  * on May 9, 2013, an agreement was signed by Veolia ES Special Services and
    Harkand Global Holdings Limited (US fund) for the sale of Marine Services;
  * during the second quarter of 2013, negotiations with the Land of Berlin
    were initiated to determine the terms of the Group’s full withdrawal from
    the Berlin water contract.

Furthermore, together with its co-shareholder, the Caisse des dépôts et
consignations, Veolia Environnement continues to prepare its withdrawal from
Transdev Group by tailoring its industrial strategy, transferring SNCM to
Veolia Environnement, targeting the balance sheet structure and refinancing
strategy. As part of negotiations on changes to Transdev Group’s share
ownership structure, at the beginning of July 2013, Veolia Environnement and
Caisse des dépôts et consignations announced the extension of their October
22, 2012 agreement until October 31, 2013. Progress with the Group's
withdrawal from the Transportation business is reflected as of June 30, 2013
by the retention of Transdev Group’s activities (excluding SNCM) in
discontinued operations. The reference value of the joint venture remains
unchanged from December 31, 2012, at €400 million for 100%.

REVENUE AND BUSINESS DEVELOPMENT ^5

                                                                                             
Revenue (€ millions)                                                              
                Half-year                                                        Foreign
                ended
Half-year       June 30,           %Change         Internal       External       exchange
Ended           2012
June 30,        re-presented       2013/2012       growth         growth         impact
2013
11,073.8        11,448.3           -3.3%           -2.0%          -0.3%          -1.0%

Revenue

Veolia Environnement consolidated revenue declined 2% at constant
consolidation scope and exchange rates (-3.3% at current consolidation scope
and exchange rates) to €11,073.8 million for the half-year ended June 30, 2013
compared with re-presented revenue of €11,448.3 million for the half-year
ended June 30, 2012, while showing some resilience in the second quarter of
2013. The second quarter contraction at constant consolidation scope and
exchange rates was limited to -1%, compared with -3% in the first quarter of
2013.

This decrease breaks down as follows:

  * in the Water division, a reduction in construction activity, partly offset
    by the positive price impact in France and in Central Europe;
  * in the Environmental Services division, a difficult macro-economic
    environment led to a decline in recycled raw material prices and volumes
    and a drop in activity levels, primarily in Europe;
  * growth in Energy Services division revenue (approximately €58 million
    compared with re-presented revenue for the half-year ended June 30, 2012),
    due to favorable weather conditions and energy prices in a difficult
    commercial environment.

Changes in consolidation scope negatively impacted 2013 first-half revenue by
€33.2 million, including +€15.9 million in the Water division (primarily the
impact of full consolidation of Azaliya from August 2, 2012) and -€52.4
million in the Environmental Services division (primarily due to the
divestiture of activities in Switzerland and the Baltic countries in 2012).

The foreign exchange impact of -€109.1 million primarily reflects the
appreciation of the euro against the Japanese yen (-€35.5 million), the UK
pound sterling (-€32.0 million), the Australian dollar (-€14.6 million) and
the US dollar (-€11.3 million).

Business Development

The Group has enjoyed a number of commercial successes since January 1, 2013
including:

  * On January 31, 2013, the city of Rialto and its concession company Rialto
    Water Services (RWS) awarded Veolia Water North America, a Veolia Water
    subsidiary, a contract to manage the city's water and wastewater systems.
    This 30-year contract will generate estimated cumulative revenue of €300
    million.
  * Veolia ES Singapore, a subsidiary of Veolia Environmental Services, was
    awarded a contract for the collection and management of municipal waste
    and recycling in the Clementi Bukit Merah district of Singapore. This
    7½-year contract will generate estimated cumulative revenue of SGD 220
    million (approximately €135 million at June 30, 2013 exchange rates).
  * On April 15, 2013, QGC, a wholly-owned subsidiary of BG Group, awarded
    Veolia Water a 20-year contract to manage the three water treatment plants
    at its coal gas production sites in the Surat Basin, in Queensland,
    eastern Australia. This contract will generate estimated cumulative
    revenue of €650 million and includes a 5-year extension option on expiry.
  * On April 29, 2013, Dalkia announced the renewal of its management contract
    for heat generation and distribution installations in Bratislava's
    Petržalka district. This new 20-year contract will generate estimated
    cumulative revenue of €1.1 billion over the period 2019-2039.
  * On May 15, 2013, Veolia Water won a €130 million contract to build three
    units for the treatment of raw water and wastewater for the Chilean pulp
    and paper producer, CMPC.
  * On May 31, 2013, Thames Water, the UK's largest water and wastewater
    services company, selected a consortium comprising Veolia Water, Costain
    and Atkins to deliver a major tranche of its program of essential upgrades
    to water and wastewater networks and treatment facilities across London
    and the Thames Valley. The amount of work for Veolia Water could be worth
    as much as £450 million (€530 million) for the period 2015 to 2020.
  * On July 2, 2013, Marafiq awarded Veolia Water a contract to design, build
    and operate the largest ultrafiltration and reverse osmosis desalination
    plant in Saudi Arabia. This contract will generate USD 310 million (€232
    million) in revenue for the plant's design and construction and USD 92
    million (€69 million) in revenue for its operation over 10 years, with an
    option to extend the contract for a further 20 years.

Acquisitions

The Group did not complete any major acquisitions during the first half of
2013.

On June 7, 2013, the Group signed an agreement with Fomento de construcciones
y Contratas (FCC) to acquire FCC’s 50% stake in Proactiva Medio Ambiente. The
transaction would amount to €150 million and will provide the Group with 100%
of the share capital of Proactiva.

OPERATIONAL PERFORMANCE ^6

Changes in adjusted operating cash flow were as follows:

                    Adjusted operating cash flow                                
                                                                    % change
                    Half-year       Half-year                       at
(€ millions)        ended           ended June         %            constant
                    June            30, 2012,          change       exchange
                    30, 2013        re-presented                    rates

                                                                     
Water               430.3           446.3              -3.6%        -3.2%
Environmental       404.1           438.0              -7.8%        -6.7%
Services
Energy              154.9           157.1              -1.4%        -1.2%
Services
Other               (59.3)          (35.0)             -69.4%       -69,4%
Segments
Adjusted
operating           930.0           1,006.4            -7.6%         
cash flow
Adjusted
operating
cash flow at        936.7           1,006.4                         -6.9%
2012 exchange
rates
Adjusted
operating           8.4%            8.8%                             
cash flow
margin

Adjusted operating cash flow declined 6.9% at constant exchange rates (-7.6%
at current consolidation scope and exchange rates) to €930.0 million for the
half-year ended June 30, 2013, compared with re-presented €1,006.4 million for
the half-year ended June 30, 2012.

The decrease in adjusted operating cash flow in the first half of 2013 was
impacted:

  * in the Water division, by contractual erosion in France and a drop in
    profitability of German activities tied to adverse price effects, as well
    as a deterioration in the margin of the Hong Kong project in the
    Technologies and Networks business;
  * in the Environmental Services division, by an unfavorable recycled raw
    material price differential in France and Germany and pressure on prices
    from industrial customers in a difficult competitive environment; and
  * by the impact of the Veolia Environnement SA’s voluntary employee
    departure plan.

Conversely, adjusted operating cash flow benefited from:

  * the positive contribution of cost saving plans, net of implementation
    costs;
  * the CICE Employment and Competitivity tax credit partly offset by the
    “Forfait social”;
  * activity growth in the Water division in Central and Eastern Europe, tied
    to price increases and the good performance of industrial contracts in the
    United States; and
  * the reversal of operating difficulties and the related restructuring
    costs.

The foreign exchange impact on adjusted operating cash flow was limited to
-€6.7 million and mainly concerns the Environmental Services division (UK
pound sterling and Australian dollar).

The change in adjusted operating income breaks down as follows:

                    Adjusted operating income*                                  
                    Half-year       Half-year                       % change
                    ended           ended              %            at
(€ millions)        June 30,        June 30,           Change       constant
                    2013            2012,                           exchange
                                    re-presented                    rates
Water               230.6           238.1              -3.2%        -3.2%
Environmental       157.8           165.8              -4.8%        -3.3%
Services
Energy              176.7           65.2               171.1%       172.2%
Services
Other               (26.5)          (49.8)             46.8%        46.8%
Segments
Total               538.6           419.3              28.4%         
Total at 2012
exchange            541.6           419.3                           29.2%
rates

*including share of adjusted net income (loss) of joint ventures and
associates

Veolia Environnement adjusted operating income, including the share of
adjusted net income (loss) of equity-accounted entities, totaled €538.6
million, compared with re-presented €419.3 million for the half-year ended
June 30, 2012, an improvement of 29.2% at constant exchange rates and 28.4% at
current consolidation scope and exchange rates.

The increase in adjusted operating income is mainly due to:

  * the decrease in adjusted operating cash flow, offset by;
  * the positive contribution of equity-accounted entities (particularly
    Dalkia International); and
  * the reversal of senior executive pension provisions in Veolia
    Environnement SA, which had a positive impact of €40.3 million in the
    first half of 2013.

The €109.1 million share of net income of equity-accounted entities breaks
down:

  * The share of net income of joint ventures of €96.8 million for the
    half-year ended June 30, 2013, compared with a re-presented net loss of
    €42.9 million for the half-year ended June 30, 2012. This substantial
    improvement was primarily due the recovery of Dalkia International Italian
    activities (SIRAM) and the base effect related to write-downs on
    receivables and accrued expenses in Italy recognized as of June 30, 2012
    of €89 million, and to the growth in Dalkia International activities in
    Central and Eastern Europe.
  * The share of net income of associates of €12.3 million for the half-year
    ended June 30, 2013, compared with re-presented €4.6 million for the
    half-year ended June 30, 2012.

Selling, general and administrative expenses for the half-year ended June 30,
2013 fell €73.5 million (-4.9%) to €1,422.1 million compared to re-presented
€1,495.6 million for the half-year ended June 30, 2012, incorporating the
effects of the asset portfolio optimization program and cost reduction plan
launched by the Group in 2012.

Net finance costs were €305.6 million for the half-year ended June 30, 2013
compared with re-presented €296.7 million for the half-year ended June 30,
2012.

They include a one-off expense of €43.0 million relating to the June 2013
buyback of bonds in the amount of €699 million equivalent.

The income tax expense for the half-year ended June 30, 2013 was €76.1
million.

In France, according to tax planning, the Veolia Environnement tax group
limited the recognition of deferred tax assets to the amount of deferred tax
liabilities as of June 30, 2013, as at the previous period end.

The effective tax rate was 106.1%.

The income tax rate for the half-year ended June 30, 2013 would be 52.6% after
adjustment for one-off items, in particular the German goodwill impairment in
Environmental Services and other non-deductible costs, for which the
deductibility is not possible given tax planning of corresponding
subsidiaries.

The net loss from discontinued operations was €16.4 million for the half-year
ended June 30, 2013, compared with re-presented net income of €211.3 million
for the half-year ended June 30, 2012 and includes equity-accounted entities
divested or in the course of divestiture.

This net loss for the half-year ended June 30, 2013 mainly reflects operations
divested or in the course of divesture:

  * Water activities in Morocco, in the course of divestiture;
  * Citelum urban lighting activities in the Energy Services division, in the
    course of divestiture;
  * Berlin water, in the course of divestiture; and
  * European wind energy activities, divested in February 2013.

The net income attributable to non-controlling interests was €84.7 million for
the half-year ended June 30, 2013, compared with re-presented €28.3 million
for the half-year ended June 30, 2012. This growth is mainly explained by the
increase in Dalkia International results.

The net income attributable to owners of the Company was €3.6 million for the
half-year ended June 30, 2013, compared with re-presented net income of €162.2
million for the half-year ended June 30, 2012. Adjusted net income
attributable to owners of the Company was €131.1 million for the half-year
ended June 30, 2013, compared with €17.8 million for the half-year ended June
30, 2012.

Given the weighted average number of shares outstanding of 510.0 million in
the first six months of 2013 (basic and diluted) and 507.7 million in the
first six months of 2012 (basic and diluted), net income per share
attributable to owners of the Company, including paid coupons on deeply
subordinated securities (basic and diluted) was -€0.03 for the half-year ended
June 30, 2013, compared with €0.32 for the half-year ended June 30, 2012.
Adjusted net income per share attributable to owners of the Company (basic and
diluted), was €0.22 for the half-year ended June 30, 2013, compared with
re-presented €0.04 for the half-year ended June 30, 2012.

CASH FLOWS ^7

Operating cash flow before changes in working capital totaled €988.6 million
in the half-year ended June 30, 2013, compared with re-presented €1,154.1
million in the half-year ended June 30, 2012, including adjusted operating
cash flow of €930 million (compared with re-presented €1,006.4 million in the
first half of 2012), operating cash flow from financing activities of €50.8
million (compared with re-presented €77.1 million in the first half of 2012)
and operating cash flow from discontinued operations of €7.8 million (compared
with re-presented €70.6 million in the first half of 2012).

The Company continues to apply selective investment criteria, while
maintaining industrial investments as required by contractual terms or
required maintenance.

Gross investments declined nearly 30% for the half-year ended June 30, 2013
compared to the half-year ended June 30, 2012, due to, firstly, the basis
impact of the investments realized in the 2012 first half (in particular the
purchase of 6.9% of Veolia Voda, in the Czech Republic, from the EBRD for an
enterprise value of €79 million and the purchase of a 10% stake in the
investment vehicle Affinity Water A for €44 million) and secondly, to a
reduction in industrial investments.

For the first half of 2013, financial divestitures (Enterprise value) and
industrial divestitures amounted to €292 million and included the divestiture
of the Veolia Water subsidiary in Portugal for €91 million. U.K. regulated
Water activities were sold in the first half of 2012 for €1,517 million in
enterprise value.

Free cash flow for the half-year ended June 30, 2013 (after payment of the
dividend) was €556 million, compared with re-presented €552 million for the
half-year ended June 30, 2012.

Free cash flow for the half-year ended June 30, 2013 mainly reflects:

  * the issue of deeply subordinated perpetual securities in the amount of
    €1,454.0 million, net of paid coupons, at the beginning of January 2013
  * the €749 million cash deterioration associated with working capital
    requirements.

The €749 million cash deterioration associated with working capital
requirements in the half-year ended June 30, 2013 compared with the
re-presented figure at the end of 2012, mainly reflects:

  * the impact of the seasonal nature of the Group’s activities (€500 million
    increase in operating working capital in the first half of 2013);
  * an extension, in certain businesses, of days sales outstanding for
    customer receivables due from Public authorities; and
  * Contractual changes in billing terms and conditions in the Water division
    in France.

Net financial debt amounted to €10,031 million as of June 30, 2013, compared
with re-presented €10,822 million as of December 31, 2012, including a
favorable foreign exchange impact of +€160 million.

Adjusted net financial debt amounted to €6,729 million as of June 30, 2013,
compared with re-presented €7,837 million as of December 31, 2012.

OBJECTIVES AND OUTLOOK

The Group confirms the amended objectives announced on the presentation of the
2012 financial statements, incorporating the new accounting standards imposing
the equity-accounting of entities previously accounted for using proportionate
consolidation and the faster than scheduled implementation of the divestiture
program.

For the period 2012-2013, Veolia Environnement’s objectives are:

- to sell €6 billion in assets^6, including the repayment of joint venture
loans relating to divestures;

- to reduce its net financial debt to between €8 billion and €9 billion and
adjusted net financial debt (net of joint venture loans) to between €6 billion
and €7 billion excluding the impact of foreign exchange fluctuations;

- to adjust, given changes in the economic environment, gross cost reductions
to €270 million in 2013 and net cost reductions to €170 million, including,
due to the new accounting treatment of joint ventures, 80% in operating
income; and

- to pay a dividend in 2013 and 2014 of €0.70 per share, in respect of fiscal
years 2012 and 2013 respectively.

After 2013, the Company aims, assuming an average economic environment, for:

- organic revenue growth of over 3% per year;

- growth in adjusted operating cash flow of over 5% per year;

- a debt leverage ratio (adjusted net financial debt/(Operating cash flow
before changes in working capital + principal payments on operating financial
assets)) of around 3.0x +/-5%;

- a payout ratio in line with the historical average.

For 2015, Veolia Environnement increased its net cost reduction target to €750
million, including, due to the new accounting treatment of joint ventures, 80%
in operating income.

Important Disclaimer

Veolia Environnement is a corporation listed on the NYSE and Euronext Paris.
This press release contains “forward-looking statements” within the meaning of
the provisions of the U.S. Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are not guarantees of future performance.
Actual results may differ materially from the forward-looking statements as a
result of a number of risks and uncertainties, many of which are outside our
control, including but not limited to: the risk of suffering reduced profits
or losses as a result of intense competition, the risk that changes in energy
prices and taxes may reduce Veolia Environnement’s profits, the risk that
governmental authorities could terminate or modify some of Veolia
Environnement’s contracts, the risk that acquisitions may not provide the
benefits that Veolia Environnement hopes to achieve, the risks related to
customary provisions of divesture transactions, the risk that Veolia
Environnement’s compliance with environmental laws may become more costly in
the future, the risk that currency exchange rate fluctuations may negatively
affect Veolia Environnement’s financial results and the price of its shares,
the risk that Veolia Environnement may incur environmental liability in
connection with its past, present and future operations, as well as the risks
described in the documents Veolia Environnement has filed with the U.S.
Securities and Exchange Commission. Veolia Environnement does not undertake,
nor does it have, any obligation to provide updates or to revise any
forward-looking statements. Investors and security holders may obtain a free
copy of documents filed by Veolia Environnement with the U.S. Securities and
Exchange Commission from Veolia Environnement.

The review of results by auditors is still in progress.

Press release also available on our web site: http://www.finance.veolia.com

                               APPENDICES^9,10

                      RESULTS BY OPERATIONAL SECTORWATER

                                                                                             
Revenue (€ millions)                                                              
Half-year       Half-year          % Change                                      Foreign
ended           ended
June 30,        June 30,           2013/2012       Internal       External       exchange
2013            2012,                              growth         growth
                re-presented                                                     impact
5,000.4         5,243.7            -4.6%           -3.7%          0.3%           -1.2%

Water division revenue declined 3.7% at constant consolidation scope and
exchange rates (-4.6% at current consolidation scope and exchange rates), due
to a dip in construction business partly offset by the positive impact of
higher tariffs in France and Central Europe.

  * Revenue from Operations remained stable at -0.2% at constant consolidation
    scope and exchange rates (-1.1% at current consolidation scope and
    exchange rates). Excluding the negative impact of Construction activities,
    Operations revenue would have increased by 1.6% at constant consolidation
    scope and exchange rates (+0.7% at current consolidation scope and
    exchange rates). This relative stability reflects contrasting trends:

       * In France, revenue declined €45.5 million, or 2.5% at constant
         consolidation scope (-2.8% at current consolidation scope), in line
         with a slowdown in the construction business, contractual erosion and
         a decrease in volumes sold (-1.9% in the half-year) accentuated by
         weather conditions and despite a favorable indexing effect compared
         with 2012.
       * Outside France, revenue rose slightly at constant consolidation scope
         and exchange rates (+1.6%) and remained stable at current
         consolidation scope and exchange rates (+0.2%). In Europe, revenue
         grew (4.0% at constant and current consolidation scope and exchange
         rates), with good performances in the Czech Republic tied to price
         increases and favorable volume trends in Germany. Revenue was
         penalized in the United Kingdom by the completion of construction
         contracts. Revenue declined 7.5% in the Asia-Pacific region at
         constant consolidation scope and exchange rates (-14.9% at current
         consolidation scope and exchange rates) due to a downturn in
         construction business in Korea and Japan. The 6.2% increase reported
         in the United States at constant consolidation scope and exchange
         rates (4.8% at current consolidation scope and exchange rates)
         benefited from the good performance of industrial contracts.

  * Technologies and Networks revenue fell 10.4% at constant consolidation
    scope and exchange rates
    (-11.3% at current consolidation scope and exchange rates), primarily due
    to the completion of numerous contracts in France and internationally in
    the “Design and Build” sector and by the lower contribution of the Hong
    Kong Sludge contract. SADE revenue was negatively impacted by unfavorable
    weather conditions in France and in Belgium. Bookings are however up 22.8%
    compared to June 2012 at €2 billion.

OPERATIONAL PERFORMANCE

                 Half-year       Half-year                       % change
(€               ended           ended June         %            at
millions)        June            30, 2012,          change       constant    
                 30, 2013        re-presented                    exchange
                                                                 rates
Adjusted
operating        430.3           446.3              -3.6%        -3.2%
cash flow
Adjusted
operating        8.6%            8.5%                             
cash flow
margin
Adjusted
operating        230.6           238.1              -3.2%        -3.2%
income *
Operating        209.2           179.5              16.5%        16.5%
income
Operating
income           4.2%            3.4%                             
margin

* including the share of adjusted net income (loss) of joint ventures and
associates.Water division adjusted operating cash flow decreased 3.2% at
constant exchange rates (-3.6% at current consolidation scope and exchange
rates) to €430.3 million for the half-year ended June 30, 2013, compared with
re-presented €446.3 million for the half-year ended June 30, 2012.This
decrease in adjusted operating cash flow is due to:

  * contractual erosion and lower volumes in France;
  * a decline in the profitability in German operations due to an unfavorable
    change in margins on electricity;
  * the exceptional activity in Japan in 2012 following the earthquake, not
    repeated in 2013; and
  * the degradation in the margin on the Hong Kong contract in the
    Technologies and Networks business.

Adjusted operating cash flow benefited in particular from:

  * the positive contribution of cost saving plans, net of implementation
    costs;
  * good performance of industrial contracts in the United States;
  * the base effect of write-downs on trade receivables and costs relating to
    the separation of regulated activities in the United Kingdom recognized in
    the first half of 2012; and
  * revenue growth in Central and Eastern Europe tied to price increases.

Adjusted operating income declined 3.2% at constant exchange rates (-3.2% at
current consolidation scope and exchange rates) to €230.6 million for the half
year ended June 30, 2013 compared with re-presented €238.1 million for the
half-year ended June 30, 2012. In addition to the decrease in adjusted
operating cash flow, adjusted operating income was penalized by charges to
provisions for operating and contractual risks, particularly in the United
States. These effects were offset by the capital gain recognized on the
divestiture of activities in Portugal.Net charges to operating provisions
totaled €23.7 million for the half-year ended June 30, 2013, compared with
re-presented net reversals of €9.5 million for the half-year ended June 30,
2012.Net charges to operating depreciation and amortization totaled €210.7
million for the half-year ended June 30, 2013, compared with re-presented
€216.1 million for the half-year ended June 30, 2012.The Convergence cost
reduction plan had a net impact of €36 million on Water division operating
income for the half-year ended June 30, 2013.

^1 The 2013 interim closure was marked by the early adoption of IFRS 10, 11
and 12 with effect from January 1, 2013. The adoption of these standards had a
significant impact on the presentation of the Consolidated financial
statements, resulting in the end of the proportionate consolidation method in
favor of the equity accounting of joint ventures. The Group therefore
re-presented the accounts for the half-year ended June 30, 2012 accordingly.
In addition to assure the comparability of periods, first half 2012 results
have been re-presented for divestments completed or in process, see page 13.

^2 Including the share of adjusted net income of joint ventures and associates

^3 See definitions on page 14 for accounting terms utilized in this press
release

^4 The 2013 interim closure was marked by the early adoption of IFRS 10, 11
and 12 with effect from January 1, 2013. The adoption of these standards had a
significant impact on the presentation of the Consolidated financial
statements, resulting in the end of the proportionate consolidation method in
favor of the equity accounting of joint ventures. The Group therefore
re-presented the accounts for the half-year ended June 30, 2012 accordingly.
In addition to assure the comparability of periods, first half 2012 results
have been re-presented for divestments completed or in process, see page 13.

^5 See definitions on page 14 for accounting terms utilized in this press
release

^6 See definitions on page 14 for accounting terms utilized in this press
release

^7 See definitions on page 14 for accounting terms utilized in this press
release

^8 Including the debt reduction of €1.4 billion related to the change to
equity accounting of Berlin Water

^9 The 2013 interim closure was marked by the early adoption of IFRS 10, 11
and 12 with effect from January 1, 2013. The adoption of these standards had a
significant impact on the presentation of the Consolidated financial
statements, resulting in the end of the proportionate consolidation method in
favor of the equity accounting of joint ventures. The Group therefore
re-presented the accounts for the half-year ended June 30, 2012 accordingly.
In addition to assure the comparability of periods, first half 2012 results
have been re-presented for divestments completed or in process, see page 13.

^10 See definitions on page 14 for accounting terms utilized in this press
release

ENVIRONMENTAL SERVICES

                                                                                             
Revenue (€ millions)                                                              
Half-year       Half-year
ended           ended              % Change        Internal       External       Foreign
June 30,        June 30,           2013/2012       growth         growth         exchange
2013            2012,                                                            impact
                re-presented
3,984.7         4,206.9            -5.3%           -3.0%          -1.2%          -1.1%

Despite good resilience in the second quarter of 2013, Environmental Services
division revenue declined 3.0% at constant consolidation scope and exchange
rates (-5.3% at current consolidation scope and exchange rates) in the first
half of 2013, and compared to -4.6% at constant consolidation scope and
exchange rates in the first quarter of 2013. The decline in first half revenue
was mainly due to a fall in recycled raw material prices and volumes (negative
effect of 2.3%) and a drop in revenue levels of 1.1% essentially in the
Collection activity.

  * In France, revenue declined 4.9% at constant and current consolidation
    scope, as a result of unfavorable movements in recycled raw material
    prices (paper and scrap metals) and in volumes.
  * Outside France, revenue declined slightly by 1.6% at constant
    consolidation scope and exchange rates (-5.5% at current consolidation
    scope and exchange rates). Revenue in Germany fell 10.9% at constant
    consolidation scope (-10.5% at current consolidation scope) under the
    combined effect of lower recycled raw material prices and volumes and
    adverse economic trends in the industrial and commercial sectors. Revenue
    in the United Kingdom increased 1.7% at constant consolidation scope and
    exchange rates (-1.8% at current consolidation scope and exchange rates)
    due to the increase in PFI contract revenue. In North America, revenue
    benefitted from growth in hazardous waste and activity levels in the
    petrochemical and refining sectors. Revenue grew 6.8% in Australia at
    constant consolidation scope and exchange rates (+2.2% at current
    consolidation scope and exchange rates), due in particular to the growth
    of the mining sector.

OPERATIONAL PERFORMANCE

                 Half-year       Half-year                       % change    
                                                                 at
(€               ended           ended June         %            constant
millions)        June                               change
                 30, 2013        30, 2012,                       exchange
                                                                 rates
                                 re-presented                     
Adjusted
operating        404.1           438.0              -7.8%        -6.7%
cash flow
Adjusted
operating        10.1%           10.4%                            
cash flow
margin
Adjusted
operating        157.8           165.8              -4.8%        -3.3%
income *
Operating        89.0            132.4              -32.8%       -30.9%
income
Operating
income           2.2%            3.1%                             
margin

* including the share of adjusted net income (loss) of joint ventures and
associates.Environmental Services division adjusted operating cash flow fell
6.7% at constant exchange rates (-7.8% at current consolidation scope and
exchange rates) to €404.1 million for the half-year ended June 30, 2013,
compared with re-presented €438.0 million for the half-year ended June 30,
2012.

Adjusted operating cash flow for the first half of 2013 declined due to the
adverse economic environment and the negative impact due to unfavorable
recycled material price variations.

These impacts were offset by:

  * the net impact of the cost reduction plans; and
  * the reversal of operating difficulties and the related restructuring costs
    incurred primarily in Italy and the Africa-Middle East region.

Adjusted operating income declined 3.3% at constant exchange rates (-4.8% at
current consolidation scope and exchange rates) to €157.8 million for the
half-year ended June 30, 2013, compared with re-presented €165.8 million for
the half-year ended June 30, 2012. This was due to the decrease in adjusted
operating cash flow offset by favorable movements in operating provisions.

Net reversals of operating provisions totaled €16.6 million for the half-year
ended June 30, 2013, compared with re-presented net charges of €17.5 million
for the half-year ended June 30, 2012.

Net charges to operating depreciation and amortization totaled €279.1 million
for the half-year ended June 30, 2013, compared with re-presented €276.6
million for the half-year ended June 30, 2012.

The Convergence cost reduction plan had a net impact of €14 million on
Environmental Services division operating income for the half-year ended June
30, 2013.

ENERGY SERVICES

Following the application of IFRS 10 and 11, Energy Services division revenue
comprises:

- 100% of revenue of Dalkia France activities;

- the revenue of U.S. operations wholly owned by the Group.

                                                                                             
Revenue (€ millions)                                                              
Half-year       Half-year                                                        Foreign
ended           ended
June 30,        June 30,           % Change        Internal       External       exchange
2013            2012,              2013/2012       growth         growth
                re-presented                                                     impact
1,972.3         1,914.3            3.0%            4.4%           -1.3%          -0.1 %

Revenue grew during the period (4.4% at constant consolidation scope and
exchange rates and 3.0% at current consolidation scope and exchange rates),
due to a positive energy price effect (approximately €38 million compared with
re-presented revenue for the half-year ended June 30, 2012) and due to
favorable weather conditions in France, in a difficult commercial environment.

  * In France, revenue grew 3.7% at constant consolidation scope (2.3% at
    current consolidation scope), due to a rise in energy prices, combined
    with more favorable weather conditions and good performance in the
    construction business.
  * In the United States, revenue surged 13.9% at constant consolidation scope
    and exchange rates (12.4% at current consolidation scope and exchange
    rates), due, firstly, to a favorable electricity and gas price effect, and
    secondly, an increase in steam volumes sold following a return to harsh
    weather conditions compared with a particular soft first half-year in
    2012.

OPERATIONAL PERFORMANCE

                 Half-year       Half-year                       % change    
                                                                 at
(€               ended           ended June         %            constant
million)         June                               change
                 30, 2013        30, 2012,                       exchange
                                 re-presented                    rates
Adjusted
operating        154.9           157.1              -1.4%        - 1.2%
cash flow
Adjusted
operating        7.9%            8.2%                             
cash flow
margin
Adjusted
operating        176.7           65.2               171.1%       172.2%
income *
Operating        108.7           119.6              -9.1%        -9.0%
income
Operating
income           5.5%            6.2%                             
margin

* including the share of adjusted net income (loss) of joint ventures and
associates.

Energy Services division adjusted operating cash flow declined 1.2% at
constant exchange rates (-1.4% at current consolidation scope and exchange
rates) to €154.9 million for the half-year ended June 30,2013 compared with
represented €157.1 million for the half-year ended June 30, 2012.

Favorable energy price effects and measures taken to improve margins,
particularly when purchasing energy, allowed the impact of commercial
portfolio attrition and adverse environment and regulatory factors, such as
the programmed cessation of gas cogeneration, to be absorbed.

Adjusted operating income was €176.7 million for the half-year ended June 30,
2013, compared with re-presented €65.2 million for the half-year ended June
30, 2012, due to the favorable contribution in Dalkia International
activities:

  * in Central and Eastern Europe, due to the dual favorable impact of price
    and weather effects in all countries of the region and despite a reduction
    in renewable energy electricity production subsidies in Poland and the
    Czech Republic;
  * the turnaround of results in Italy following restructuring measures
    implemented and write-downs on receivables and accrued expenses of €89
    million recognized in the half-year ended June 30, 2012.

Net reversals of operating provisions totaled €3.8 million for the half-year
ended June 30, 2013, compared with re-presented €8 million for the half-year
ended June 30, 2012.

Net charges to operating depreciation and amortization totaled €51.3 million
for the half-year ended June 30, 2013, compared with re-presented €46.8
million for the half-year ended June 30, 2012.

The Convergence cost reduction plan had a net impact of €24 million on Energy
Services division operating income for the half-year ended June 30, 2013.

OTHER SEGMENT

The “Other Segment” groups together certain industrial multi-service contracts
and the various Group holding companies.

                                                                                             
Revenue (€ millions)                                                              
Half-year       Half-year                                                        Foreign
ended           ended
June 30,        June 30,           % Change        Internal       External       exchange
2013            2012,              2013/2012       growth         growth
                re-presented                                                     impact
116.4           83.4               39.6%           6.0%           33.6%          0%

The 6.0% increase in “Other segment” revenue at constant consolidation scope
and exchange rates (39.6% at current consolidation scope and exchange rates)
is mainly due to the entry into the operating phase of a major industrial
contract.

Reconciliation of previously published and re-presented data for the half-year
                             ended June 30, 2012

                       Half-year                                                             Half-year
                       ended                             Restatement                         ended June
                       June            Restatement                         Restatement       30, 2012,
(€ millions)           30, 2012,       IFRS 5 ^(1)       IFRS 10           IAS 19r           re-presented    
                       published                         and 11
                                                                                              
                        
                                                                                                               
Revenue                14,781          (4)               (3,329)                             11,448
Adjusted
operating cash         1,384           23                (401)                               1,006
flow
Operating income       523             47                (202)             5                 373
Operating income
after share of
net income             523             38                (231)             5                 335
(loss) of
equity-accounted
entities ^(2)
Adjusted
operating income       631             15                (232)             5                 419
^(3)
Net Income ^(4)        153                               4                 5                 162
Adjusted Net           8               1                 4                 5                 18
Income ^(4)
Gross                  1,348                             (404)                               944
Investments
Free Cash Flow         348                               204                                 552
Net financial          14,693                            (2,331)                             12,362
debt
Loans granted to       -               -                 3,648             -                 3,648
joint ventures
Adjusted net           -               -                 -                 -                 8,714
financial debt

(1) Water activities in Morocco, Berlin Water and Eolfi

(2) Including the re-presented share of net income (loss) of joint ventures
and associates for the half-year ended June 30, 2012

(3) Including the re-presented share of adjusted net income (loss) of joint
ventures and associates for the half-year ended June 30, 2012

(4) Attributable to owners of the Company

                            ACCOUNTING DEFINITIONS

GAAP (IFRS) indicators

Operating cash flow before changes in working capital, as presented in the
Consolidated cash flow statement, is comprised of three components: operating
cash flow from operating activities (referred to as “adjusted operating cash
flow” and known in French as “capacité d’autofinancement opérationnelle”)
consisting of operating income and expenses received and paid (“cash”),
operating cash flow from financing activities including cash financial items
relating to other financial income and expenses and operating cash flow from
discontinued operations composed of cash operating and financial income and
expense items classified in net income from discontinued operations pursuant
to IFRS 5. Adjusted operating cash flow does not include the share
attributable to equity-accounted entities.

The operating income margin is defined as operating income as a percentage of
revenue from continuing operations.

Net finance costs represent the cost of gross debt, including related gains
and losses on interest rate and currency hedges, less income on cash and cash
equivalents.

Net income (loss) from discontinued operations is the total of income and
expenses, net of tax, related to businesses divested or in the course of
divestiture, in accordance with IFRS 5.

Non-GAAP indicators

In addition, the Group uses non-GAAP indicators for management purposes. These
are relevant indicators of the Group’s operating and financial performance.

The new standards, IFRS 10, 11 and 12, have modified existing indicators or
created new indicators that are described below:

  * Following application of the new standards, inter-company loans granted to
    joint ventures are no longer deducted from net financial debt.
    Non-eliminated inter-company loans are presented in the balance sheet in
    loans and financial receivables. As these loans and receivables are not
    included in the Group definition of Cash and cash equivalents and these
    joint ventures no longer generate strictly operating flows in the
    consolidated financial statements, the Group now uses in addition to net
    financial debt, the indicator adjusted net financial debt. Adjusted net
    financial debt is therefore equal to Net financial debt less loans and
    receivables to joint ventures.
  * Adjusted operating income is equal to net income after the share of
    adjusted net income (loss) of equity-accounted entities, adjusted to
    exclude the impact of goodwill impairment and certain special items.
    Special items include items such as gains and losses from asset disposals
    that substantially change the economics of one or more cash-generating
    units and restructuring costs. Special items also include significant
    impairment charges relating to assets other than goodwill. In general, we
    exclude impairment charges in respect of such assets as “special” items
    when they are large enough to significantly impact the economics of a
    cash-generating unit. Items may qualify as “special” even though they may
    have occurred in prior years or are likely to recur in subsequent years.
    Other “special” items may be non-recurring, meaning that the nature of the
    relevant charge or gain is such that it is not reasonably to recur within
    two years and there was not a similar charge or gain within the two prior
    years.

The other indicators were not impacted by the new standards and are defined as
follows:

  * The term “internal growth” (or “growth at constant consolidation scope and
    exchange rates”) includes growth resulting from:

       * the expansion of an existing contract, primarily resulting from an
         increase in prices and/or volumes distributed or processed,
       * new contracts, and
       * the acquisition of operating assets allocated to a particular
         contract or project;

  * The term “external growth” includes growth through acquisitions (performed
    in the period or which had only partial effect in the prior period), net
    of divestitures, of entities and/or assets deployed in different markets
    and/or containing a portfolio of more than one contract;
  * The term “change at constant exchange rates” represents the change
    resulting from the application of exchange rates of the prior period to
    the current period, all other things being equal;
  * Net financial debt (NFD) represents gross financial debt (non-current
    borrowings, current borrowings, bank overdrafts and other cash position
    items), net of cash and cash equivalents and excluding fair value
    adjustments to derivatives hedging debt;
  * The financing rate is defined as the ratio of net finance costs (excluding
    fair value adjustments to instruments not qualifying for hedge accounting)
    to average monthly net financial debt for the period, including net
    finance costs of discontinued operations;
  * The “adjusted leverage ratio” is defined as the ratio of adjusted net
    financial debt to operating cash flow before changes in working capital
    plus operating financial asset repayments.
  * Adjusted net income attributable to owners of the Company is equal to net
    income attributable to owners of the Company adjusted to exclude goodwill
    impairment and certain special items. Special items include items such as
    gains and losses from asset disposals that substantially change the
    economics of one or more cash-generating units and restructuring costs.
    Special items also include significant impairment charges relating to
    assets other than goodwill. In general, we exclude impairment charges in
    respect of such assets as “special” items when they are large enough to
    significantly impact the economics of a cash-generating unit. Items may
    qualify as “special” even though they may have occurred in prior years or
    are likely to recur in subsequent years. Other “special” items may be
    nonrecurring, meaning that the nature of the relevant charge or gain is
    such that it is not reasonably to recur within two years and there was not
    a similar charge or gain within the two prior years.
  * The adjusted operating cash flow margin is defined as the ratio of
    adjusted operating cash flow to revenue from continuing operations;
  * Free Cash Flow represents cash generated (sum of operating cash flow
    before changes in working capital and principal payments on operating
    financial assets) net of the cash component of the following items: (i)
    changes in working capital for operations, (ii) operations involving
    equity (share capital movements, dividends paid and received), (iii)
    investments net of divestitures, (iv) the change in receivables and other
    financial assets, (v) net financial interest paid and (vi) tax paid;
  * The term net investment, as presented in the Statement of change in net
    financial debt, includes industrial investments net of industrial asset
    disposals (purchases of intangible assets and property, plant and
    equipment net of disposals), financial investment net of financial
    divestitures (purchases of financial assets net of divestitures, including
    the net financial debt of companies entering or leaving the scope of
    consolidation), partial purchases net of sales resulting from transactions
    with non-controlling interests where there is no change in control, new
    operating financial assets and principal payments on operating financial
    assets. The net investment concept also takes into account issues of share
    capital by non-controlling interests.

The Group considers growth investments, which generate additional cash flows,
separately from maintenance-related investments, which reflect the replacement
of equipment and installations used by the Group.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION - ASSETS

CONSOLIDATED                          As of December         As of January       
STATEMENT OF
FINANCIAL
POSITION -             As of          31, 2012               1, 2012
ASSETS
(€ millions)           June 30,       re-presented^(1)       re-presented^(1)
                       2013
Goodwill               3,793.5        3,911.9                4,796.2
Concession
intangible             2,318.0        2,373.1                2,219.3
assets
Other intangible       851.1          926.3                  1,014.9
assets
Property, plant        4,526.1        4,706.3                6,497.4
and equipment
Investments in         2,783.2        2,721.2                2,939.6
joint ventures
Investments in         431.6          477.7                  360.8
associates
Non-consolidated       43.3           47.0                   65.4
investments
Non-current
operating              2,000.4        2,215.9                2,091.5
financial assets
Non-current
derivative             245.7          280.0                  745.0
instruments -
Assets
Other
non-current            1,944.8        2,441.3                2,864.6
financial assets
Deferred tax           1,041.9        1,018.7                1,065.0
assets
Non-current            19 979.6       21,119.4               24,659.7
assets
Inventories and        647.0          614.9                  664.5
work-in-progress
Operating              8,295.5        8,573.8                8,836.5
receivables
Current
operating              154.6          167.0                  165.2
financial assets
Other current          1,724.4        1,488.6                978.9
financial assets
Current
derivative             52.5           45.4                   49.6
instruments –
Assets
Cash and cash          3,683.4        4,998.0                5,025.4
equivalents
Assets
classified as          1,953.1        1,469.6                687.5
held for sale
Current assets         16,510.5       17,357.3               16,407.6
TOTAL ASSETS           36,490.1       38,476.7               41,067.3

^(1) New consolidation standards presented in note 1.1.3.1. and revised
Employee Benefits standard presented in note 1.1.3.2. of the Condensed
Consolidated Interim Financial statements provide for a mandatory
retrospective application. As a consequence, consolidated financial statements
as of December 31, 2012 as well as January 1, 2012 have been represented
accordingly.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION – EQUITY AND LIABILITIES

CONSOLIDATED
STATEMENT OF          As of           As of December         As of January       
FINANCIAL
POSITION              June 30,        31, 2012               1, 2012
- EQUITY AND          2013            re-presented^(1)       re-presented^(1)
LIABILITIES
(€ millions)                                                  
Share capital         2,744.4         2,610.4                2,598.2
Additional            7,851.2         8,466.3                9,796.2
paid-in capital
Reserves and
retained
earnings              (2,236.5)       (3,970.5)              (5,386.9)
attributable to
owners of the
Company
Total equity
attributable to       8,359.1         7,106.2                7,007.5
owners of the
Company
Total equity
attributable to       1,405.0         1,391.4                1,532.8
non-controlling
interests
Equity                9,764.1         8,497.6                8,540.3
Non-current           1,835.3         1,792.9                1,793.8
provisions
Non-current           10,111.4        12,131.3               14,213.3
borrowings
Non-current
derivative            147.6           186.8                  156.8
instruments –
Liabilities
Deferred tax          993.8           1,010.3                1,465.1
liabilities
Non-current           13,088.1        15,121.3               17,629.0
liabilities
Operating             8,523.2         9,562.8                9,897.8
payables
Current               455.8           466.7                  533.6
provisions
Current               3,507.6         3,606.1                3,753.2
borrowings
Current
derivative            50.7            73.6                   85.0
instruments –
Liabilities
Bank overdrafts
and other cash        260.9           252.7                  390.5
position items
Liabilities
directly
associated with       839.7           895.9                  237.9
assets
classified as
held for sale
Current               13,637.9        14,857.8               14,898.0
liabilities
TOTAL EQUITY          36,490.1        38,476.7               41,067.3
AND LIABILITIES

(1) New consolidation standards presented in note 1.1.3.1. and revised
Employee Benefits standard presented in note 1.1.3.2. of the Condensed
Consolidated Interim Financial Statements provide for a mandatory
retrospective application. As a consequence, consolidated financial statements
as of December 31 December 31, 2012 as well as January 1, 2012 have been
represented accordingly.

CONSOLIDATED INCOME STATEMENT

                                    Half-year        Half-year ended         
(€ millions)                        ended June       June 30, 2012
                                    30, 2013         re-presented((1)(3))
Revenue                             11,073.8         11,448.3
o/w Revenue from operating          91.0             92.2
financial assets
Cost of sales                       (9,300.4)        (9,575.7)
Selling costs                       (264.0)          (263.9)
General and administrative          (1,158.1)        (1,231.7)
expenses
Other operating revenue and         12.6             (4.0)
expenses
Operating income                    363.9            373.0
Share of net income (loss) of       109.1            (38.3)
equity-accounted entities
o/w share of net income             96.8             (42.9)
(loss) of joint ventures
o/w share of net income             12.3             4.6
(loss) of associates
Operating income after share
of net income (loss) of             473.0            334.7
equity-accounted entities
Finance costs                       (328.1)          (327.0)
Income from cash and cash           22.5             30.3
equivalents
Other financial income and          13.4             23.5
expenses
Income tax expense                  (76.1)           (82.3)
Share of net income (loss) of
other equity-accounted              -                -
entities
Net income (loss) from              104.7            (20.8)
continuing operations
Net income (loss) from              (16.4)           211.3
discontinued operations
Net income (loss) for the           88.3             190.5
period
Attributable to owners of the       3.6              162.2
Company
Attributable to                     84.7             28.3
non-controlling interests
                                                      
(in euros)                                            
NET INCOME (LOSS)
ATTRIBUTABLE TO OWNERS OF THE
COMPANY PER SHARE ^(2)
Diluted                             (0.03)           0.32
Basic                               (0.03)           0.32
NET INCOME (LOSS) FROM
CONTINUING OPERATIONS
ATTRIBUTABLE TO OWNERS OF THE
COMPANY PER SHARE ^(2)
Diluted                             0.01             (0.12)
Basic                               0.01             (0.12)
NET INCOME (LOSS) FROM
DISCONTINUED OPERATIONS
ATTRIBUTABLE TO OWNERS OF THE
COMPANY PER SHARE ^(2)
Diluted                             (0.04)           0.44
Basic                               (0.04)           0.44

(1) Pursuant to IFRS 5, Non-Current Assets Held for Sale and Discontinued
Operations, the income statements of:

  * discontinued operations in the course of divestiture:

       * urban lighting activities (Citelum) in the Energy Services division;
       * Water activities in Morocco
       * The share of net income of the Berlin Water associate, until June
         30,2013

  * discontinued operations divested:

       * regulated activities in the United Kingdom in the Water division,
         divested in June 2012
       * Solid Waste activities in the United States in the Environmental
         Services division, divested in November 2012
       * American wind energy activities, divested in December 2012;
       * European wind energy activities, divested in February 2013;

are presented retrospectively in a separate line, Net income (loss) from
discontinued operations, for the half-year ended June 30, 2012.

(2) Pursuant to IAS 33, the weighted average number of shares outstanding
taken into account for the calculation of 2012 net income per share was
adjusted following the distribution of a scrip dividend in June 2013. The
adjusted weighted average number of shares is therefore 507.7 million (basic
and diluted) as of June 30, 2012.

Basic earnings per share is calculated by dividing net income attributable to
owners of the Company by the weighted average number of ordinary shares
outstanding during the fiscal year. According to IAS 33.9 and 12 standards,
net income attributable to owners of the Company has been adjusted to take
into account the cost of the coupon payable to holders of deeply subordinated
securities issued by Veolia Environnement.

As of June 30, 2013, the weighted average number of shares outstanding is
510,034,028 (basic and diluted)

(3) New consolidation standards presented in note 1.1.3.1. and revised
Employee Benefits standard presented in note 1.1.3.2. of the Condensed
Consolidated Interim Financial statements provide for a mandatory
retrospective application. As a consequence, consolidated financial statements
as of December 31, 2012 as well as January 1, 2012 have been represented
accordingly.

CONSOLIDATED CASH FLOW STATEMENT

                                       Half-year        Half-year ended      
(€ million)                            ended June       June 30, 2012,
                                       30,
                                       2013             re-presented((1))
Net income (loss) for the period       88.3             190.5
Operating depreciation,
amortization, provisions and           593.4            656.8
impairment losses
Financial amortization and             16.1             1.3
impairment losses
Gains/losses on disposal and           (17.2)           (271.4)
dilution
Share of net income (loss) of          (97.0)           79.0
joint ventures
Share of net income (loss) of          (21.9)           (4.8)
associates
Dividends received                     (1.6)            (1.5)
Finance costs and finance income       317.8            316.9
Income tax expense                     80.7             96.0
Other items                            30.0             91.3
Operating cash flow before             988.6            1,154.1
changes in working capital
Changes in working capital             (748.8)          (499.8)
Income taxes paid                      (123.3)          (97.8)
Net cash from operating                116.5            556.5
activities
Including Net cash from
operating activities of                (14.6)           44.3
discontinued operations
Industrial investments                 (525.5)          (697.9)
Proceeds on disposal of
intangible assets and property,        30.4             25.6
plant and equipment
Purchases of investments               (3.3)            (54.5)
Proceeds on disposal of                85.7             650.5
financial assets
Operating financial assets
New operating financial assets         (75.6)           (89.5)
Principal payments on operating        94.6             95.4
financial assets
Dividends received (including
dividends received from joint          75.6             73.4
ventures and associates)
New non-current loans granted          (489.6)          (116.9)
Principal payments on                  11.2             17.2
non-current loans
Net decrease/increase in current       139.9            (29.7)
loans
Net cash used in investing             (656.6)          (126.4)
activities
Including Net cash used in
investing activities of                (31.9)           615.9
discontinued operations
Net increase/decrease in current       (599.0)          (551.3)
borrowings
New non-current borrowings and         81.3             1,112.1
other debts
Principal payments on
non-current borrowings and other       (1,180.6)        (1,183.5)
debts
Proceeds on issue of shares            0.4              0.2
Share capital reduction                -                -
Transactions with
non-controlling interests:             (8.5)            (80.0)
partial purchases
Transactions with
non-controlling interests:             1.3              1.9
partial sales
Proceeds on issue of deeply            1,470.2          -
subordinated securities
Coupons on deeply subordinated         (16.6)           -
securities
Purchases of/proceeds from             -                -
treasury shares
Dividends paid                         (171.6)          (403.5)
Interest paid                          (459.5)          (454.3)
Net cash used in financing             (882.6)          (1,558.4)
activities
Including Net cash used in
financing activities of                (38.5)           568.6
discontinued operations
NET CASH AT THE BEGINNING OF THE       4,745.3          4,634.9
PERIOD
Effect of foreign exchange rate        99.9             (35.5)
changes and other
NET CASH AT THE END OF THE             3,422.5          3,471.1
PERIOD
Cash and cash equivalents              3,683,4          3,916.1
Bank overdrafts and other cash         260,9            445.0
position items
NET CASH AT THE END OF THE             3,422.5          3,471.1
PERIOD

(1) New consolidation standards presented in note 1.1.3.1. and revised
Employee Benefits standard presented in note 1.1.3.2. of the Condensed
Consolidated Interim Financial statements provide for a mandatory
retrospective application. As a consequence, consolidated financial statements
as of December 31, 2012 as well as January 1, 2012 have been represented
accordingly.

Contact:

Veolia Environnement
Analyst and institutional investors:
Ronald Wasylec, +33 1 71 75 12 23
Ariane de Lamaze, +33 1 71 75 06 00
or
US Investors:
Terri Anne Powers, +1 312-552-2890
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