Veolia Environnement: 2013 Annual Results1

  Veolia Environnement: 2013 Annual Results1

                TRANSFORMATION PLAN: 2013 OBJECTIVES ACHIEVED

      FURTHER SIGNIFICANT DECLINE IN NET FINANCIAL DEBT TO €8.2 BILLION

          ADJUSTED OPERATING INCOME INCREASED 16.9% TO €922 MILLION

                ADJUSTED NET INCOME QUADRUPLED TO €223 MILLION

             PROPOSED 2014 DIVIDEND OF €0.70 AND €0.70 FOR 2015^2

           2014 OBJECTIVES: SIGNIFICANT GROWTH IN RESULTS EXPECTED

Business Wire

PARIS -- February 27, 2014

Regulatory News:

Veolia Environnement (Paris:VIE):

  *RESULTS STEADILY IMPROVED THROUGHOUT THE YEAR:

       *Stabilization across quarters of the Y-Y evolution of revenue at
         constant consolidation scope and exchange rates.
       *Cost reductions exceeded the objective.
       *Net improvement in the Y-Y trends in adjusted operating cash flowby
         the end of the year, with a stable Q4 at constant scope and exchange
         rates, or +2.5% excluding restructuring charges. For the full year
         2013, adjusted operating cash flow declined 4.1% at constant scope
         and exchange rates, or -1.7% excluding restructuring charges.
       *Adjusted operating income increased 16.9% at constant exchange rates
         to €922 million.
       *Adjusted net income was €223 million compared to €58 million in 2012.
       *Net income was -€135 million due to the impact of non-recurring
         charges.

  *OUTLOOK:

       *For 2014^3, Veolia Environnement aims to achieve:

            *Growth in revenue.
            *Around 10% growth in adjusted operating cash flow and
              significant growth in adjusted operating income and adjusted net
              income.
            *Proposal to pay a dividend of €0.70 per share in respect of the
              2014 fiscal year and payable in 2015^2.

       *2015 objectives are confirmed.

Antoine Frérot, Veolia Environnement Chairman and CEO noted: “The improved
performance during the year reflects the initial benefits of Veolia
Environnement’s transformation plan. All of the objectives we set for 2013
were achieved, and certain objectives were exceeded, which allows us to
approach the second phase of our strategic plan with even more confidence. The
2014 fiscal year will mark a return to growth in our results, with specific
2014 objectives^3 of: revenue growth, around 10% growth in adjusted operating
cash flow, and significant growth in adjusted operating income and adjusted
net income. Veolia is therefore well on the path to profitable and sustainable
growth.”

2013 Annual Results Key Figures^4

                                          
Revenue: €22.3 billion                     Net cumulative cost savings: €178
                                             million
Adjusted operating cash flow: €1,796         Divestments: €1,253 million
million
Adjusted operating income: €922 million      Net financial debt: €8.2 billion
Adjusted net income: €223 million            Adjusted net financial debt: €5.5
                                             billion
Net income: -€135 million                  Adjusted leverage ratio: 2.5x

  *Revenue was €22,315 million compared to re-presented €23,239 million for
    the year ended December 31, 2012

       *Water revenue declined 2.2% at constant scope and exchange rates to
         €10,222 million

- Return of organic growth in the Operations business: favorable indexation
(+2.2%), but temporary slowdown of construction activities in certain
contracts, lower volumes sold (-1.5%) and contractual erosion in France. Good
performance in Central and Eastern Europe operations and industrial contracts
in the United States.

- Technologies and Networks revenue declined 7.5% at constant scope and
exchange rates: completion of international Design & Build contracts and
unfavorable weather effects in France, but rebound in bookings, which
increased 32% Y-Y to €3.3 billion.

  *Environmental Services revenue declined 1.5% at constant scope and
    exchange rates to €8,076 million, with stability in the second half
    despite a tough comparison base in Q4

- Improvement in the impact of raw materials prices in the second half, even
though prices remained down for the full year. Raw materials volumes still
declined.

- Impact of volume / activity levels in 2013 was -1.1%.

  *Energy Services revenue declined 1.1% at constant scope and exchange rates
    to €3,756 million

Benefit of higher energy prices and favorable weather impacts absorbed by the
impact of the end of gas cogeneration contracts in France.

  *Adjusted operating cash flow amounted to €1,796 million, down 2.4% at
    constant exchange rates and excluding restructuring charges, and compared
    to re-presented €1,919 million for the year ended December 31, 2012.
    Adjusted operating cash flow Y-Y trends improved by the end of the year.

       *Water: increase of 1.1% at constant exchange rates in the Operations
         business. Technologies and Networks adjusted operating cash flow
         declined as a result of the degradation of the Hong Kong sludge
         contract margin and the decline in revenue. Overall, total adjusted
         operating cash flow in Water posted a slight decline of 1.6% at
         constant exchange rates.
       *Environmental Services: decline of 4.6% at constant exchange rates of
         which -1.5% associated with change in scope and -2.0% was associated
         with lower prices and volumes of recycled raw materials.
         Stabilization since the second quarter.
       *Energy Services: Reduction of 5.9% at constant exchange rates due to
         the end of gas cogeneration contracts in France.

  *Adjusted operating income improved significantly (+16.9% at constant
    exchange rates) to €922 million compared to re-presented €798 million for
    the year ended December 31, 2012.

       *Good contribution from joint ventures and associates, mainly due to
         Dalkia International, which had a net impact in 2012 of €65 million
         in write downs of receivables and accrued expenses in Italy.
       *Favorable impact of the cost savings plan, net of implementation
         costs.
       *Positive impact of the closure of the defined benefit plan for
         executives.

  *Adjusted net income amounted to €223 million compared to re-presented €58
    million for the year ended December 31, 2012

       *Adjusted net income benefited from the significant improvement in
         adjusted operating income.
       *Net loss amounted to -€135 million compared to €404 million for the
         year ended December 31, 2012, and was negatively impacted by a €150
         million goodwill impairment in Environmental Services in Germany,
         €141 million in restructuring charges, including the VE SA and France
         water departure plans, as well as €73 million in costs related to the
         early redemption of bonds. Transport activities had a loss of -€51M,
         primarily related to SNCM. For the year ended December 31, 2012, net
         income included capital gains on the divestiture of the regulated
         waster business in the United Kingdom and the solid waste business in
         the Unites States, for €233.3 million and €208.4 million
         respectively.

  *The Company’s asset portfolio optimization policy continued at a steady
    pace in 2013

       *€1,253 million in asset divestitures, including the 25% stake in
         Berlin Wasser.
       *The gradual withdrawal from Transdev has not progressed further due
         to the situation with SNCM. Veolia and the Caisse des Dépôts have
         each converted €280 million in loans to equity of their subsidiary.

  *Net financial debt declined significantly to €8.2 billion at December 31,
    2013 compared to re-presented €10.8 billion at December 31, 2012. Adjusted
    net financial debt amounted to €5.5 billion at December 31, 2013 compared
    to re-presented €7.8 billion at December 31, 2012.
  *Proposed dividend of €0.70 to be paid in cash or shares in relation to the
    2013 fiscal year, and proposed dividend of €0.70 for the 2014 fiscal year.
    The Board of Directors will propose at the Annual General Shareholder
    Meeting to be held April 24, 2014 a dividend payment of €0.70 per share in
    respect of the 2013 fiscal year, payable in cash or in shares of Veolia
    Environnement. These new shares will be issued at a price equivalent to
    95% of the average opening price on the Euronext Paris of the shares over
    the twenty trading days prior to the day of the Annual General
    Shareholders Meeting, less the amount of the dividend. The ex-dividend
    date (for ordinary shares only) has been set as April 30, 2014. The period
    during which shareholders may choose the option of the payment of dividend
    in cash or in shares will begin on April 30, 2014 and end May 16, 2014.
    The 2013 dividend will be paid, in cash or in shares, in either case from
    May 28, 2014.

                             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.

         RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2013^5

In an economic environment that remains uncertain, the Group implemented the
second year of its transformation plan through:

  *a new geographical organization set up since July 2013;
  *the cost reduction program;
  *continued optimization and divestiture of assets and;
  *the decline in net financial debt.

  *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" thanks 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 activities 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 activities, business operations are
now brought together within each country, with Country Directors in charge of
both Water and Environmental Services activities. The integrated and direct
Group monitoring, under the operational authority of the Chief Operating
Officer, is organized around country groupings, representing the first level
of resource allocation.

Dalkia International, a subsidiary of Veolia Environnement and EDF, retains
its current organizational structure but will be integrated into this new
structure in due course.

The global specialty entities, whose markets are widely globalized, are
included in a specific organization.

The composition of the Veolia Environnement Management Committee and Executive
Committee was revised to better reflect this geographic structure and
facilitate the development of country-based synergies.

The announcement of the new organizational structure of the Group does not
change the terms of performance monitoring or resource allocation for the
current year and therefore does not impact segment reporting in 2013.

From 2014, the new organizational structure will lead the Group to adapt its
segment reporting to better reflect the Group’s performance as reviewed by the
chief operating decision maker.

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
information system streamlining efforts, €100 million in respect of purchasing
and €110 million associated with efficiency projects in the businesses and
headquarters.

The Group cost reduction plan (Convergence) generated €178 million in
additional cumulative net savings in the two year period ended December 31,
2013, recorded in operating income (before application of IFRS 10 and 11), out
of an objective of €170 million, net of implementation costs. Post application
of IFRS 10 and 11 cumulative net savings amounted to approximately €140
million.

  *Shareholding restructuring of the Energy Services division

On October 28, 2013, EDF and Veolia Environnement announced the launch of
advanced discussions for the conclusion of an agreement on their joint
subsidiary Dalkia. The Boards of Directors of these two groups met and
approved the continuation of negotiations.

Upon completion of these discussions, EDF would acquire all Dalkia group
activities in France, while Veolia Environnement would acquire the activities
of Dalkia International; the sale of Dalkia France shares to EDF and of Dalkia
International shares by EDF to the Group are inseparable parts of the planned
transaction. Under this transaction, Veolia Environnement would make a cash
payment to EDF to compensate for the difference in value of the investments
owned by the two shareholders in the various Dalkia group entities. The amount
of this cash payment, estimated at €550 million, is likely to be adjusted to
take account of the definitive structure of the transaction and the cash
position of Dalkia SAS as of December 31, 2013.

Given the progress to date of the different processes necessary for the
completion of the transaction (employee representative bodies, anti-trust
authorities, carve-out), it should be finalized in 2014.

This transaction will not lead to the Group’s withdrawal from any countries or
the cessation of any of the Group’s businesses, in particular Energy Services.

Accordingly, this transaction is reflected as follows in the Group’s
consolidated financial statements as of December 31, 2013:

  *Transfer of Dalkia’s assets and liabilities in France to “Assets
    classified as held for sale” and “Liabilities directly associated with
    assets classified as held for sale” in the consolidated statement of
    financial position, pursuant to IFRS 5, for a net asset amount of €1,529.1
    million, including Dalkia France’s external debt of €203.8 million;
  *Remeasurement of Dalkia France assets and liabilities at the lower of net
    carrying amount and fair value less costs to sell, without impact on the
    consolidated accounts of the Group as of December 31, 2013.

Furthermore, until the transaction completion date, the Group’s investment in
Dalkia International remains equity-accounted.

Overall, the transaction should not impact the net financial debt of Veolia
Environnement, which currently provides most of Dalkia group financing.

Following completion of the transaction, Dalkia’s international activities
will be held exclusively by the Group and will be fully consolidated.

The transaction will secure the development of Dalkia group activities
internationally, while strengthening Veolia Environnement's ambitions in the
energy services sector. It will also put an end to the litigation between EDF
and Veolia Environnement pending before the Paris Commercial Court.

Once finalized, the draft agreement will be submitted for approval to EDF's
and Veolia Environnement's respective Boards of Directors.

  *Acquisition of Proactiva Medio Ambiente

On November 28, 2013, Veolia completed the acquisition of the 50% stake in
Proactiva Medio Ambiente historically held by the Fomento de Construcciones y
Contratas (FCC) group. This transaction will allow Veolia Environnement to
consolidate its positions in Latin America in waste management and water
treatment and support its development strategy in high-growth regions.

Had the acquisition been completed on January 1, 2013, the revenue and
operating income contribution of Proactiva Medio Ambiente would have amounted
to €510.1 million and €42.7 million, respectively.

The total transaction amount of €150 million and its breakdown are presented
in Note 3.3 to the Group consolidated financial statements as of December 31,
2013.

Accordingly, in 2013, Proactiva Medio Ambiente was equity-accounted up to the
date of acquisition of control and fully consolidated thereafter. In
accordance with the provisions of IFRS 3R, this transaction is therefore
reflected by:

  *the recognition of net income of €82 million, equal to the fair value
    remeasurement of the investment stake previously held in ProactivaMedio
    Ambiente;
  *the recognition of provisional goodwill of €193 million;
  *a financial investment of €238 million (enterprise value), comprising the
    cash payment of €125 million and additional Proactiva Medio Ambiente debt
    of €113 million included in Group net financial debt.

  *Asset portfolio optimization policy:

The Group continued to implement its asset portfolio optimization 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;
  *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;
  *the initial public offering on the Oman stock exchange of 35% of the
    shares of Sharqiyah Desalinisation Company (of which 19.25% held by the
    Group) on June 13, 2013, which resulted for the Group in the sale of
    1,255,128 shares for €2.7 million. Following the listing, this entity has
    been equity-accounted since June 30, 2013. The impact on Group net
    financial debt was €89 million;
  *the deconsolidation of practically all Environmental Services activities
    in Italy, following the approval of the group voluntary liquidation plan
    (Concordato preventivo di gruppo, CPG) on July 17, 2013. The impact on
    Group net financial debt was €90 million;
  *the divestiture of Marine Services Offshore on August 29, 2013 for an
    enterprise value of €23 million to Harkland Global Holdings Limited (US
    fund);
  *the divestiture of its 24.95% stake in Berlin Wasser in the amount of
    €636.3 million. This transaction was carried out on December 2, 2013; and
  *the divestiture of Regaz by Dalkia France on December 12, 2013, for a
    consideration of €46.5 million.

Overall, these financial (in enterprise value) and industrial divestitures
represented a total of €1,253 million in the year ended December 31, 2013.

  *Transdev Group and SNCM:

In 2013, the difficulties of Société nationale Corse Méditerranée (SNCM) did
not enable Veolia Environnement to withdraw from Transdev Group.

The Memorandum of Understanding signed by Transdev Group’s two shareholders in
October 2012 and providing for an increase in Caisse des dépôts et
consignations’s stake in the share capital of Transdev Group to 60% and the
transfer by Transdev Group to Veolia of its 66% stake in SNCM, lapsed on
October 31, 2013, the deadline for signature of an agreement.

Accordingly, the Group modified the accounting presentation of its investment
in Transdev Group for the publication of its 2013 financial statements,
transferring it from “Assets classified as held for sale” (discontinued
operations) to “Investments in joint ventures” (continuing operations),
accounted for using the equity method. Pursuant to IFRS 5.28 and IAS 28.21,
the Group modified retrospectively the accounting presentation of its
investment in 2012 and 2011. Given the Group’s confirmed desire to continue
its withdrawal from Transdev, the Group’s investment in the Transdev Group
does not represent an extension of the Group’s businesses within the meaning
of the French Accounting Standards Authority’s recommendation of April 4,
2013.

SNCM remains equity-accounted indirectly through the recognition of the
Transdev Group joint venture. During closing procedures on the Group
consolidated financial statements for the year ended December 31, 2013, the
Group assessed its net exposure to SNCM as a result of its indirect interest.

Given the litigation proceedings in progress as of December 31, 2013, the
Group considers the best way to reflect in the accounts the exposure arising
from its indirect interest in SNCM, is to recognize the amounts that would be
payable under the most probable scenario, that is an appropriate collective
procedure with a disposal plan associated with a transaction:

  *In the Group consolidated financial statements as of December 31, 2013,
    the equity-accounting value of Transdev Group reflects a fair appraisal of
    the Group’s exposure to its interest in SNCM;
  *Veolia Environnement’s receivable on SNCM of €14 million is fully
    provisioned in the Group consolidated financial statements as of December
    31, 2013.

Under this scenario, the repayments claimed by the European Commission
pursuant to the disputes regarding the privatization process (€220 million
excluding interest) andcompensation paid for so-called complementary services
(€220 million excluding interest, representing the majority of the €300
million amount noted associated with risks related to SNCM in our quarterly
financial report ending September 30, 2013) would not be paid. Should this
scenario not prevail, the Company would reassess the financial impacts.

An assessment by the Group of the value in use of Transdev Group (excluding
SNCM) confirmed its net carrying amount.

Financing of the Transdev Group joint venture

To provide Transdev Group with the financial flexibility required for its
development and in order to strengthen its balance sheet, on December 18,
2013, Veolia Environnement SA and the Caisse des dépôts carried out a share
capital increase of €560 million (of which €280 million subscribed by Veolia
Environnement SA through the capitalization of loans). Hence, the loans
granted to the Transdev Group joint venture, the expiry date of which was
deferred by one year (i.e.March 3, 2015), totaled €622.0 million at December
31, 2013.

REVENUE AND BUSINESS DEVELOPMENT ^6

Year ended   Year ended                                  
December      December 31,   % Change    Internal   External   Foreign
31, 2013      2012           2013/2012   growth     growth     exchange
(€ million)   re-presented                                     impact
            (€ million)                               
22,314.8     23,238.9      -4.0%      -1.8%     -0.4%     -1.8%

Veolia Environnement consolidated revenue declined by -1.8% at constant
consolidation scope and exchange rates (-4.0% at current consolidation scope
and exchange rates) to €22,314.8 million for the year ended December 31, 2013
compared with re-presented €23,238.9 million for the year ended December 31,
2012.

At current consolidation scope and exchange rates, the changes in revenue were
as follows: -3.9% in the first quarter, -2.6% in the second quarter, -5.5% in
the third quarter and -4.0% in the fourth quarter.

Changes in consolidation scope negatively impacted 2013 revenue by -€95.5
million, including:

  *-€108.2 million in the Environmental Services division, primarily related
    to the divestiture of activities in Switzerland, the Baltic States, the
    divestiture of Energonut in Italy and Pinellas in 2012, as well as the
    divestiture of Marine Services Offshore in the United States in August
    2013;
  *+€38.8 million relating to the acquisition of the 50% stake held by the
    Fomento de Construcciones y Contratas (FCC) Group in Proactiva Medio
    Ambiente as from November 28, 2013.

However, at constant consolidation scope and exchange rates, revenue showed
solid resilience, with quarterly Y-Y trends of -3.0% in the first quarter,
-1.0% in the second quarter, -1.5% in the third and fourth quarters, resulting
in -1.8% for the year ended December 31, 2013.

This decrease breaks down as follows:

  *in the Water division, a reduction in construction activity, contractual
    erosion in France, partially offset by the higher tariffs due to
    indexation in France and in Central and Eastern Europe and the slowdown in
    Technologies and Networks activities;
  *in the Environmental Services division, a difficult macro-economic
    environment that led to a decline in recycled raw material prices and
    volumes and a drop in activity levels in Europe (mainly France and
    Germany);
  *in the Energy Services division, the forseen end of Gas Cogeneration
    contracts, partially offset by the favorable energy price impact compared
    to the re-presented period ended December 31, 2012 and improved weather
    conditions.

Fourth quarter revenue in 2013 fell by -4.0% at current consolidation scope
and exchange rates compared to the fourth quarter of 2012. At constant
consolidation scope and exchange rates, revenue declined by -1.5% in the
fourth quarter of 2013, due to an underperformance in Australia in the
Environmental Services division which had benefited from a business turnaround
in the last quarter of 2012 and in the Energy Services division less favorable
climate in France and the impact of the forseen end of Gas Cogeneration
contracts.

Revenue generated outside France in 2013 totaled €11,011.2 million,
representing 49.3% of total revenue, stable compared with the re-presented
50.0% in 2012.

The foreign exchange impact of -€416.6 million primarily reflects the
appreciation of the euro against the Australian dollar (-€100.3 million), the
pound sterling (-€88.4 million), the Japanese yen (-€85.8 million), the US
dollar (-€56.4 million) and the Czech crown (-€20.9 million).

Commercial Development

The Group has recorded 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 should generate estimated cumulative revenue of
    USD300 million (approximately €226 million at the 2013 average exchange
    rate.)
  *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 should generate estimated cumulative revenue of SGD 220
    million (approximately €132 million at the 2013 average exchange rate).
  *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 is expected to 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 should 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 is expected to 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.
  *On July 16, 2013, MAF Dalkia was awarded a global energy and technical
    management contract for Abu Dhabi’s flagship airports. This 3-year
    contract is expected to generate cumulative revenue of €40 million and
    includes a full range of energy savings strategies and management of all
    technical installations and security systems across the 4 main airports of
    the ADAC.
  *On September 11, 2013, Veolia Water and Vapor Procesos signed a contract
    with Codelco to recover copper contained in tailings ponds at the El
    Teniente mine, the world’s largest copper producing mine, located in the
    south of Santiago de Chile. This mine annually produces roughly 400,000
    tons of copper.
  *On November 15, 2013, Dalkia announced that it had finalized with the
    Canadian fund Fengate Capital Management Ltd the financing of one of the
    largest biomass plants in Canada. Under this Design, Finance, Build,
    Operate, Maintain contract,Dalkia will be responsible for industrial
    management and installation maintenance as well as the supply and
    preparation of wood biomass. This 30-year contract should generate
    estimated revenue of €600 million.
  *On December 12, 2013, Veolia, through its subsidiary Sidem, was awarded,
    in partnership with Hyundai Heavy Industries, the Engineering, Purchasing,
    Construction contract for the desalination plant of the Az Zour North
    complex in Kuwait. Hyun dai will be responsible for building the 1,500 MW
    capacity electrical power station. The plant’s electricity and water
    production will be fully purchased by the Kuwait government over 40 years.
    Work began at the end of 2013 and will be completed at the end of 2016.
    Revenue is estimated at €320 million.

OPERATING PERFORMANCE^7

Changes in adjusted operating cash flow were as follows:

                          Adjusted operating cash flow
                                     December      Change
(€ million)                December   31,  2012      at current   at constant
                          31, 2013  re-presented  exchange    exchange
                                                     rates        rates
Water                      833.1      853.6          -2.4%       -1.5%
Environmental Services     846.7      911.3          -7.1%        -4.6%
Energy Services            228.7      244.8          -6.6%        -5.9%
Other                     (112.2)   (91.0)        -23.3%      -23.3%
Adjusted operating cash   1,796.3   1,918.7       -6.4%       
flow
Adjusted operating cash
flow at 2012 exchange     1,828.4   1,918.7                  -4.7%
rates
Adjusted operating cash   8.0%      8.3%                     
flow margin

Adjusted operating cash flow declined -4.7% at constant exchange rates (-6.4%
at current consolidation scope and exchange rates) to €1,796.3 million for the
year ended December 31, 2013, compared with re-presented €1,918.7 million for
the year ended December 31, 2012.

The decrease in adjusted operating cash flow in 2013 was impacted:

  *in the Water division, by contractual erosion in France and a drop in
    profitability of German activities tied to the reduction in energy
    margins, as well as the degradation 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, in an economic
    environment that remains difficult in Europe;
  *in the Energy Services division, by the foreseen end to Gas Cogeneration
    contracts in France; and
  *finally by changes in restructuring expenses, including the impact of the
    Veolia Environnement voluntary departure plan. Restructuring expenses
    amounted to €77.6 million for the year ended December 31, 2013 compared
    with re-presented €35.1 million for the year ended December 31, 2012.

Excluding restructuring charges, adjusted operating cash flow declined by
-4.1% at current consolidation scope and exchange rates (-2.4% at constant
exchange rates) for the year ended December 31, 2013.

Conversely, adjusted operating cash flow benefited from:

  *the positive contribution of cost saving plans, net of implementation
    costs;
  *the CICE Employment and Competitiveness tax credit partly offset by the
    increase in the “Forfait social”;
  *price increases in Central and Eastern Europe and the solid performance of
    industrial contracts in the United States in the Water division; and
  *the reversal of operating difficulties and the related restructuring
    expenses in the Environmental Services division.

The foreign exchange impact on adjusted operating cash flow was limited to
-€32.1 million and mainly concerns the Environmental Services division (pound
sterling and Australian dollar).

Operating income (before net income or loss of equity-accounted entities)
declined by -29.7% at constant exchange rates (-31.0% at current consolidation
scope and exchange rates) to €490.5 million, impacted particularly by:

  *the decrease in adjusted operating cash flow;
  *the increase in goodwill impairment by €103.6 million as of December 31,
    2013, compared to the re-presented period ended December 31, 2012 (As of
    December 31, 2013, impairment losses on goodwill totaled €168.0 million
    recognized in the Environmental Services division in Germany and Poland.
    Re-presented impairment losses as of December 31, 2012 concerned
    impairment of goodwill recognized on non-regulated activities in the
    United Kingdom in the Water division and Environmental Services division
    activities in Estonia and Lithuania); and
  *the recognition for the year ended December 31, 2013 of restructuring
    expenses in connection with the Water division voluntary departure plan in
    France (in the amount of €97 million).

Operating income after share of net income or loss of joint ventures and
associates decreased by -2.7% at constant exchange rates (-4.3% at current
exchange rates) to €669.2 million for the year ended December 31, 2013,
compared with re-presented €699.4 million for the year ended December 31,
2012. It includes the share of net income of joint ventures and associates in
the amount of €178.7 million, compared with a re-presented net loss of -€11.9
million for the year ended December 31, 2012.

Adjusted operating income includes the Group’s share of adjusted net income of
joint ventures and associates of €122.2 million, compared with re-presented
€3.7 million for the year ended December 31, 2012. This increase was primarily
due to the impairment of receivables and accrued expenses in Italy recognized
as of December 31, 2012 for €65.1 million (i.e. €81.5 million before taxes).

The change in adjusted operating income breaks down as follows:

                              Adjusted operating income^8
(€ million)                              December             % Change
                               December   31, 2012    % Change   at constant
                               31, 2013   re-                    exchange
                                      presented           rates
Water                          438.2      475.5       -7.8%      -7.6%
Environmental Services         373.2      328.4       13.6%      16.4%
Energy Services                202.8      121.2       67.5%      68.0%
Other                         (92.3)    (127.0)    27.4%     27.4%
Total                         921.9     798.1      15.5%     
Total at 2012 exchange rates  932.9     798.1               16.9%

Adjusted operating income^8 rose to €921.9 million (16.9% at constant exchange
rates and 15.5% at current consolidation scope and exchange rates compared
with re-presented adjusted operating income for the year ended December 31,
2012) due to:

  *at Veolia Environnement SA, the positive impact of €40.3 million related
    to the closure in 2013 of the defined benefit pension plan for senior
    executives;
  *in the Energy Services division, the absence of impairments on receivables
    and other accrued expenses recorded in the year ended December 31, 2012
    for €65.1 million (€81.5 before tax) in the share of adjusted net income
    of joint ventures; and
  *in the Environmental Services division, the positive impact of the
    deconsolidation of activities in Italy, partially offset by the impairment
    of assets in Canada and the United Kingdom.

Net finance costs totaled -€576.2 million for the year ended December 31,
2013, compared with re-presented -€644.2 million for the year ended December
31, 2012.

The decrease in net finance costs between 2013 and 2012 was mainly due to:

  *reduction in expenses relating to the partial buybacks of bond lines in
    2012 and 2013;
  *redemption of the bond line maturing in May 2013 for €432 million
    (4.875%), the USD bond line maturing in June 2013 for USD 490 million
    (5.25%) and;
  *repayment of the drawdown in Polish zlotys on the multi-currency
    syndicated loan facility in April 2013 in the amount of €390 million
    equivalent.

The €73.1 million expense related to the buyback of bond lines in 2013 in
connection with the Group’s asset optimization program is recorded as
adjustment to net finance costs.

The income tax expense for the year ended December 31, 2013 was €128.3
million.

The effective tax rate was -269.0%, considering asset impairments not
deductible for tax purposes and the non-recognition of deferred tax assets in
certain countries and tax groupings according to their respective business
plans. Therefore, in France, considering the 5-year tax schedule, the Veolia
Environnement tax group limited the recognition of deferred tax assets to the
amount of deferred tax liabilities as of December 31, 2013, as was the case in
2011 and 2012.

As of December 31, 2013, after adjustment for the following one-off items, the
tax rate was 74.8% (compared to a re-presented 52.0% as of December 31, 2012):

  *non-recurring net income or loss of controlled entities (as specified
    below),
  *capital gains and losses on divestitures;
  *impairment of intangible assets and property, plant and equipment as well
    as provisions for losses at completion; and
  *impacts of changes in income tax rates, particularly in the United
    Kingdom.

Finally, after adjustments for the following non-recurring items in the net
income before tax of controlled entities the income tax rate was 40.7%
(compared to a re-presented 43.0% as of December 31, 2012):

  *goodwill impairment in the amount of -€168.4 million;
  *restructuring expenses for -€140.8 million; and
  *adjustments to net financial income in the amount of -€87.4 million.

Other equity-accounted entities only concern Transdev Group. The share of net
income or loss of equity-accounted entities whose activity is not considered
core to the Group’s businesses is presented as an adjustment to net income.

Key operational indicators for Transdev Group at 100% for the years ended
December 31, 2013 and December 31, 2012, on a re-presented basis, are as
follows:

(€ million)                   Transdev Group  Transdev Group
                               Year ended       Year ended
                               December 31,     December 31, 2012
                             2013 ((*))      re-presented ((*))
Revenue                        6,606.1          6,797.2
Adjusted operating cash flow   341.8            297.3
Operating income ^(**)         38.6             (291.1)

^(*) after application of IFRS 10, 11 and 12
^(**) including the share of adjusted net income (loss) of joint ventures and
associates.

At constant consolidation scope and exchange rates, Transdev reported a slight
decrease in revenues (-1.0%).

The termination of the Nice and Cannes municipal contracts in France,
Friesland and ZHN in the Netherlands was partially offset by growth in
international business, primarily in Australia with the new Sydney Ferries
contract and the Melbourne bus franchise.

In an ongoing uncertain economic environment, the adjusted operating cash flow
of Transdev Group increased by 13.1% at constant consolidation scope and
exchange rates. This positive trend was attributable in France to improved
operating performances, the savings realized by the plans initiated and the
net contribution of the CICE Employment and Competitiveness tax credit, and
for most other countries to the initial results of action plans and a decrease
in overheads reflecting the impacts of measures undertaken in 2012.

Operating income for the year ended December 31, 2013, which benefitted from
the increase in operating cash flow, includes impairment losses on goodwill
and non-current assets, down €278 million compared to 2012 which had been
marked by substantial impairment losses in the Netherlands.

The net loss of Transdev Group for the year ended December 31, 2013 was
-€140.5 million.

The share of net loss of Transdev Group consolidated under the equity method
in the Group’s consolidated financial statements totaled -€51.5 million for
the year ended December 31, 2013, compared to a re-presented loss of -€45.3
million for the year ended December 31, 2012 and reflects a fair appraisal of
the Group’s exposure to its interest in SNCM.

Net income from discontinued operations amounted to €27.3 million for the year
ended December 31, 2013, compared with re-presented €431.8 million for the
year ended December 31, 2012, which included capital gains from the
divestiture of the regulated water business in the United Kingdom and the
Solid waste business in the United States for €233.3 million and €208.4
million, respectively. The net income arising from these operations for the
year ended December 31, 2013 mainly comprised the Water activities in Morocco
in the course of divestiture and the interest in Berlin Wasser divested in
early December 2013.

The net income attributable to non-controlling interests was €113.8 million
for the year ended December 31, 2013, compared with re-presented €35.6 million
for the year ended December 31, 2012.

This item mainly concerns the minority shareholders of subsidiaries in the
Water division (€68.9 million), the Environmental Services division (€8.6
million), the Energy Services division (€36.0 million) and the Other Segments
division (€0.3 million).

The rise in the net income attributable to non-controlling interests was
mainly due to the increase in the net income of Dalkia international in
connection with the impairment losses on receivables and accrued expenses in
Italy which had been recognized in 2012.

The net loss attributable to owners of the Company amounted to -€135.3 million
for the year ended December 31, 2013 compared to a re-presented net income of
€404.0 million for the year ended December 31, 2012.

Adjusted net income attributable to owners of the Company amounted to €223.2
million for the year ended December 31, 2013, compared with re-presented €58.5
million for the year ended December 31, 2012.

Given the weighted average number of shares outstanding of 523.5 million in
2013 (basic and diluted) and 509.0 million in 2012 (basic and diluted),
earnings per share attributable to owners of the Company (basic and diluted)
was -€0.29 for the year ended December 31, 2013, compared with €0.79 for the
year ended December 31, 2012.

Adjusted net income per share attributable to owners of the Company (basic and
diluted), including paid coupons on deeply subordinated securities, was €0.39
for the year ended December 31, 2013, compared with re-presented €0.11 for the
year ended December 31, 2012.

CASH FLOWS^9

Operating cash flow before changes in working capital totaled €1,970.4 million
in 2013, compared with re-presented €2,173.1 million in 2012, including
adjusted operating cash flow of €1,796.3 million (compared with re-presented
€1,918.7 million in 2012), operating cash flow from financing activities of
€88.5 million (compared with re-presented €119.4 million in 2012) and
operating cash flow from discontinued operations of €85.8 million (compared
with re-presented €135.2 million in 2012).

Cash associated with working capital requirements in 2013 declined by -€4
million, compared with the represented figure at the end of 2012; this
stability was mainly attributable to:

  *measures to manage customer receivables and DSO, despite an extension, in
    certain businesses/countries, of days sales outstanding for customer
    receivables due from public authorities;
  *advances received at the end of December 2013 for new major projects in
    the Technologies and Networks activity.

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

For the year ended December 31, 2013, gross investments decreased by almost
35% compared to the re-presented period ended December 31, 2012, due to a
decline in industrial and financial investments:

Industrial investments (including assets purchased under finance leases)
amounted to €1,245 million, compared with re-presented €1,708 million for the
year ended December 31, 2012. This decrease by nearly 27% reflects the
management of investments, particularly:

  *in the Water division, with a 19% decline in growth and
    maintenance-related investments, mainly in France;
  *in the Environmental Services division, with a 18% decline in industrial
    investments (primarily maintenance-related investments) relating to
    divestiture of Solid Waste activities in the United States in 2012;
  *in the Energy Services division, where industrial investments dropped by
    23% (mainly growth investments in France); and
  *finally in other operating segments, the decline involves the planned
    construction of a wind farm in the United States for €185 million in 2012.

Financial investments totaled €254 million for the year ended December 31,
2013, compared with re-presented €589 million for the year ended December 31,
2012:

  *At the end of December 2013, the acquisition of the 50% stake held by the
    Fomento de Construcciones y Contratas (FCC) group in Proactiva Medio
    Ambiente had a €238 million impact on financial investments, comprising
    the cash payment of €125 million on the signature date and additional
    Proactiva Medio Ambiente debt of €113 million now included in Group net
    financial debt.
  *Financial investments in 2012 mainly comprised the acquisition of an
    additional 49% stake in Azaliya for an enterprise value of €458 million
    and the buyback of 6.9% of Veolia Voda in the Czech Republic from EBRD for
    €79 million.

Transactions related to the asset portfolio optimization program amounted to
€1,253 million for the year ended December 31, 2013, compared with
re-presented €3,473 million for the year ended December 31, 2012, and comprise
financial divestitures of €1,117 million (see before) and industrial
divestitures for €120 million, of which €71 million in the Water division and
€42 million in the Environmental Services division.

Free cash flow for the year ended December 31, 2013 (after payment of the
dividend) was €2,168 million, compared with re-presented €1,910 million for
the year ended December 31, 2012.

Free cash flow for the year ended December 31, 2013 mainly reflects:

  *the decline in adjusted operating cash flow;
  *relatively stable working capital of -€4 million;
  *the issue of deeply subordinated perpetual securities in the amount of
    €1,453.6 million, net of paid coupons, at the beginning of January 2013;
  *management of industrial investments (€1,245 million for the year ended
    December 31, 2013), down by more than 27% compared to the re-presented
    period ended December 31, 2012; and
  *the continued asset portfolio optimization program which contributed to
    the reduction in the Group’s debt in the amount of €1,253 million at the
    end of 2013. The implementation of the divestiture program contributed to
    the reduction in the Group’s debt in the re-presented amount of €3,473
    million for the year ended December 31, 2012.

Net financial debt totaled €8.2 billion as of December 31, 2013, compared with
re-presented €10.8 billion as of December 31, 2012.

Adjusted net financial debt (adjusted for loans granted to joint ventures)
fell from represented €7.8 billion as of December 31, 2012 to €5.5 billion as
of December 31, 2013. Net financial debt and adjusted net financial debt
declined due to the solid operating cash flow, the issuance of deeply
subordinated perpetual securities and the Group’s asset portfolio optimization
policy.

PRO FORMA FINANCIAL INFORMATION

As from the first quarter of 2014, considering the Group reorganization,
primary segment reporting will be presented by geographical area and will be
organized as follows:

  *France,
  *Europe, excluding France
  *Rest of the world
  *Global Businesses
  *Other

These data exclude Dalkia France and include a 12 month Dalkia International
contribution at 100%:

                          December 31,  December   % change at
Revenue in € millions      2013           31, 2012    current
                           Pro Forma      Pro Forma   exchange
                                                rates
France                     5,672.7        5,857.1     -3.1%
Europe, excluding France   7,670.2        7,841.5     -2.2%
Rest of the world          4,552.2        4,808.7     -5.3%
Global Businesses          4,205.7        4,617.8     -8.9%
Other                     1,347.5       1,407.6    -4.3%
Total                     23,448.3      24,532.7   -4.4%

                                   December 31,  December 31,  % change at
Adjusted operating cash flow in €   2013           2012           current
millions
                                    Pro Forma      Pro Forma      exchange
                                                            rates
France                              633.6          651.9          -2.8%
Europe, excluding France            938.0          1,017.1        -7.8%
Rest of the world                   421.8          401.0          5.2%
Global Businesses                   216.8          254.0          -14.6%
Other                              -123.4        -239.7        -48.5%
Total                              2,086.8       2,084.3       0.1%

                          December 31,  December 31,  % change at
Industrial investments     2013           2012           current
in € millions              Pro Forma      Pro Forma      exchange
                                                   rates
France                     313.1          354.3          -11.6%
Europe, excluding France   567.3          628.8          -9.8%
Rest of the world          335.9          515.5          -34.8%
Global Businesses          121.4          148.8          -18.4%
Other                     121.4         319.2         -62.0%
Total                     1,459.1       1,966.6       -25.8%

OBJECTIVES AND OUTLOOK

For the 2014 fiscal year^10, in view of the progress of the transformation
plan, Veolia aims to achieve:

  *Growth in revenue;
  *Adjusted operating cash flow growth of around 10%;
  *Significant growth in adjusted operating income; and
  *Significant growth in adjusted net income.
  *Proposal of a dividend of €0.70 per share in relation to the 2014 fiscal
    year.

Beginning 2015, the Company aims to achieve, in a mid-cycle economic
environment:

  *Organic revenue growth of more than 3% per year;
  *Adjusted operating cash flow growth of more than 5% per year;
  *An adjusted leverage ratio (adjusted net financial debt / operating cash
    flow before changes in working capital + principal repayments of operating
    financial assets) of the order of 3x, +/-5%;
  *A dividend payout ratio in line with historic level;
  *Net cumulative cost savings of €750 million, of which due to accounting
    standards for joint ventures, 80% will benefit adjusted operating income.

                               APPENDICES^11/12
                               SEGMENT RESULTS

WATER
REVENUE

Year ended  Year ended                                        
December     December 31,      % Change    Internal     External    Foreign
31,                                        growth       growth      exchange
2013         2012              2013/2012                            impact
             re-presented
(€          (€ million)                                     
million)
10,221.9    10,696.2         -4.4%      -2.2%       -0.3%      -1.9%

Water division revenue declined -2.2% at constant consolidation scope and
exchange rates (-4.4% at current consolidation scope and exchange rates),
primarily due to the decrease in the construction business, contractual
erosion in France, partially offset by the positive impact of higher tariffs
due to indexation in France and in Central and Eastern Europe and the slowdown
in Technologies and Networks activities.

  *Revenue from Operations activities remained stable at +0.6% at constant
    consolidation scope and exchange rates (-1.6% at current consolidation
    scope and exchange rates). Excluding the negative impact of Construction
    activities, Operations revenue would have increased by around 2.3% at
    constant consolidation scope and exchange rates (+0.1% at current
    consolidation scope and exchange rates). This relative stability reflects
    contrasting trends:

In France, revenue declined by -2.3% at constant consolidation scope (-2.7% at
current consolidation scope), in line with a slowdown in the construction
business, contractual erosion and a decrease in volumes sold (-1.5% in 2013
compared to 2012) accentuated by 2013 adverse weather conditions and despite a
favorable indexing effect compared with 2012.

Outside France, revenue rose by 3.2% at constant consolidation scope and
exchange rates and remained stable at -0.5% at current consolidation scope and
exchange rates. In Europe, revenue climbed (5.0% at constant consolidation
scope and exchange rates and 3.8% at current consolidation scope and exchange
rates), with solid performances in Romania and the Czech Republic tied to
price increases and favorable volume and price trends in Germany. Revenue was
penalized in the United Kingdom by the completion of construction contracts.
Revenue declined by -1.4% in the Asia-Pacific region at constant consolidation
scope and exchange rates (-13.3% at current consolidation scope and exchange
rates) due to a downturn in construction business in Korea and Japan. The 5.3%
increase reported in the United States at constant consolidation scope and
exchange rates (2.0% at current consolidation scope and exchange rates)
benefited from the robust performance of industrial contracts.

  *Technologies and Networks revenue fell sharply by -7.5% at constant
    consolidation scope and exchange rates
    (-9.8% 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 incineration plan construction contract. SADE revenue was
    negatively impacted by 2013 unfavorable weather conditions in France and
    Belgium. Bookings were however up 32% compared to December 2012 at around
    €3.3 billion, primarily for industrial clients in the oil and gas sectors,
    although there was also a turnaround in the municipal market at the
    year-end.

OPERATING PERFORMANCE

(€ million)          Year ended    Year ended    % change at  % change at
                      December 31,   December 31,   current       constant
                      2013           2012 re-       exchange      exchange
                                 presented     rates        rates
Adjusted operating   833.1         853.6         -2.4%        -1.6%
cash flow
Adjusted operating   8.2%          8.0%                      
cash flow margin
Operating income     290.2         386.9         -25.0%       -24.9%
Operating income     2.8%          3.6%                      
margin
                                                          
Adjusted operating   438.2         475.5         -7.8%        -7.6%
income *

Water division adjusted operating cash flow decreased by -1.6% at constant
exchange rates (-2.4% at current consolidation scope and exchange rates) to
€833.1 million for the year ended December 31, 2013, compared with
re-presented €853.6 million for the year ended December 31, 2012.

For Operations activities, adjusted operating cash flow rose by 1.1% at
constant exchange rates (0.5% at current consolidation scope and exchange
rates).

Adjusted operating cash flow benefited in particular from:

  *the positive contribution of cost saving plans, net of implementation
    costs;
  *solid performance of industrial contracts in the United States;
  *the non-recurrence of impairment losses on trade receivables in the United
    Kingdom and Guadeloupe; and
  *price increases in Central and Eastern Europe.

These items were partially offset by:

  *contractual erosion and lower volumes in France;
  *a decline in the profitability of German operations due to an unfavorable
    change in margins on electricity; and
  *the exceptional activity in Japan in 2012 following the earthquake, not
    repeated in 2013.

The adjusted operating cash flow of the Technologies and Networks business
declined sharply in line with the deterioration in the margin on the sludge
incineration contract in Hong Kong.

Adjusted operating income declined by -7.6% at constant exchange rates (-7.8%
at current consolidation scope and exchange rates) to €438.2 million for the
year ended December 31, 2013 compared with re-presented €475.5 million for the
year ended December 31, 2012. In addition to the decrease in adjusted
operating cash flow, adjusted operating income was penalized by the difference
in capital gains or losses on divestitures.

Net charges to operating depreciation and amortization totaled -€491.2 million
for the year ended December 31, 2013, compared with re-presented -€448.2
million for the year ended December 31, 2012. This increase mainly concerns
France in connection with the planned reorganization and its impacts on the
information systems.

Net charges to operating provisions totaled -€94.4 million for the year ended
December 31, 2013, compared with re-presented -€5.8 million for the year ended
December 31, 2012. As of December 31, 2013, they included restructuring costs
in connection with the Water division voluntary departure plan in France in
the amount of €97 million (presented as an adjustment to operating income).

Accordingly, the operating income margin (operating income / revenue) declined
from re-presented 3.6% for the year ended December, 2012 to 2.8% for the year
ended December 31, 2013.

ENVIRONMENTAL SERVICES

REVENUE

Year ended  Year ended                                        
December     December 31,      % Change    Internal     External    Foreign
31,                                        growth       growth
2013         2012              2013/2012                            exchange
             re-presented                                           impact
(€          (€ million)                                     
million)
8,075.5     8,512.0          -5.1%      -1.5%       -1.3%      -2.3%

The decline in Environmental Services division revenue by -1.5% at constant
consolidation scope and exchange rates (-5.1% at current consolidation scope
and exchange rates), compared to the re-presented revenue for the year ended
December 31, 2012, was mainly due to a 1.5% fall in recycled raw material
prices and volumes and a 1.1% drop in activity levels, mainly in municipal
collection. However, the decline in raw material prices and volumes slowed
down in the second half of 2013.

  *In the Environmental Services division, the revenue consolidation scope
    impact for the year ended December 31, 2013 was negative in the amount of
    -€108.2 million, mainly resulting from the divestiture of activities in
    Switzerland and the Baltic States, Energonut in Italy and Pinellas in 2012
    together with the divestiture of Marine Services Offshore in the United
    States in August 2013.
  *In France, revenue declined -2.7% at constant consolidation scope and
    current consolidation scope , as a result of unfavorable changes in raw
    material volumes and prices (paper and scrap metals) and the fall in the
    level of activity in municipal and commercial collection in a competitive
    environment.
  *Outside France, revenue declined slightly by -0.7% at constant
    consolidation scope and exchange rates (-6.7% at current consolidation
    scope and exchange rates). Revenue in Germany fell -7.8% at constant
    consolidation scope and at current consolidation scope under the combined
    effect of lower recycled raw material prices and volumes and adverse
    economic trends in the industrial sector. Revenue in the United Kingdom
    increased 3.1% 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 (+1.5% at constant consolidation
    scope and exchange rates and -8.2% at current consolidation scope and
    exchange rates), revenue benefitted from growth in hazardous waste and
    industrial sector (petrochemicals and refining) activity. Revenue rose by
    1.1% in Australia at constant consolidation scope and exchange rates
    (-6.7% at current consolidation scope and exchange rates) due to the
    rising price of commercial waste collection services.

OPERATING PERFORMANCE

(€ million)        For the year  For the year    % change at  % change at
                    ended          ended December   current       constant
                    December       31, 2012 re-     exchange      exchange
                  31, 2013      presented       rates        rates
Adjusted
operating cash     846.7         911.3           -7.1%        -4.6%
flow
Adjusted
operating cash     10.5%         10.7%                       
flow margin
Operating income   156.6         267.1           -41.4%       -38.1%
Operating income   1.9%          3.1%                        
margin
Adjusted
operating income   373.2         328.4           13.6%        16.4%
*

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

Adjusted operating cash flow decreased by -4.6% at constant exchange rates
(-7.1% at current consolidation scope and exchange rates) to €846.7 million
for the year ended December 31, 2013, compared with re-presented €911.3
million for the year ended December 31, 2012.

Adjusted operating cash flow in 2013 declined due to:

  *the difficult macro-economic context and the negative price differential
    for recycled raw materials in France and Germany;
  *the decline in the level of activity in municipal and commercial
    collection in France and Germany and in industrial services in France; and
  *greater cost inflation than the service price increases in France, the
    United Kingdom and Germany.

These items were offset by:

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

Adjusted operating income improved 16.4% at constant exchange rates (13.6% at
current consolidation scope and exchange rates) to €373.2 million for the year
ended December 31, 2013 compared with re-presented €328.4 million for the year
ended December 31, 2012.

The increase in adjusted operating income was primarily due to the positive
impact arising from the deconsolidation of Italian activities, following the
approval of the “Concordato preventivo di gruppo” (CPG).

Net charges to operating provisions totaled -€6.9 million for the year ended
December 31, 2013, compared with a re-presented net charge of -€65.8 million
for the year ended December 31, 2012, mainly due to the absence of impairment
losses recorded for the Marine Services business recorded in 2012 in
connection with the fair value adjustment related to the sale agreement.

Net charges to operating depreciation and amortization totaled -€587.3 million
for the year ended December 31, 2013, compared with re-presented -€580.1
million for the year ended December 31, 2012, an increase primarily concerning
the United Kingdom.

Accordingly, the operating income margin (operating income / revenue) declined
from re-presented 3.1% for the year ended December, 2012 to 1.9% for the year
ended December 31, 2013.

ENERGY SERVICES

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

  *100% of revenue of Dalkia France activities, as Dalkia International is
    equity-accounted; and
  *the revenue of U.S. operations wholly owned by the Group .

REVENUE

Year ended  Year ended                                        
December     December 31,      % Change    Internal     External    Foreign
31,                                        growth       growth
2013         2012              2013/2012                            exchange
             re-presented                                           impact
(€          (€ million)                                     
million)
3,756.5     3,852.0          -2.5%      -1.1%       -1.2%      -0.2%

Revenue declined slightly (-1.1% at constant consolidation scope and exchange
rates and -2.5% at current consolidation scope and exchange rates), due to the
forseen end of Gas Cogeneration contracts in France, partially offset by a
positive energy price effect (approximately €55 million compared with
re-presented revenue for the year ended December 31, 2012) and favorable
weather conditions in France, in a difficult commercial environment.

  *In France, revenue declined -1.9% at constant consolidation scope (-3.2%
    at current consolidation scope), due to the forseen end of Gas
    Cogeneration contracts in France, partially offset by a rise in energy
    prices, combined with more favorable weather conditions.
  *In the United States, revenue surged 10.9% at constant consolidation scope
    and exchange rates (7.3% at current consolidation scope and exchange
    rates), due to a favorable gas price effect and an increase in steam
    volumes sold following a return to harsh weather conditions compared with
    a particularly mild 2012 winter.

^1 The closure of the 2013 fiscal year 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 year ended December 31, 2012
accordingly. In addition to assure the comparability of periods, 2012 annual
results have been re-presented for divestments completed or in process, see
page 19 of this press release.

^2 In view of the good progress of the transformation plan, the Board of
Directors will propose the payment of a €0.70 dividend per share in respect of
the 2014 fiscal year, payable in 2015.

^3 At current exchange rates

^4 See definitions on page 20 of this press release

^5 The closure of the 2013 fiscal year 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 year ended December 31, 2012
accordingly. In addition to assure the comparability of periods, 2012 annual
results have been re-presented for divestments completed or in process, see
page 19 of this press release.

^6 See definitions on page 20 of this press release.

^7 See definitions on page 20 of this press release

^8 After share of adjusted net income (loss) of joint ventures and associates

^9 See definitions on page 20 of this press release.

^10 At current exchange rates

^11 The closure of the 2013 fiscal year 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 year ended December 31, 2012
accordingly. In addition to assure the comparability of periods, 2012 annual
results have been re-presented for divestments completed or in process, see
page 19 of the press release

^12 See definitions on page 20 of this press release

OPERATING PERFORMANCE

(€ million)                        For the year  % change at  % change at
                      For the year   ended          current       constant
                      December       December       exchange      exchange
                      31, 2013       31, 2012 re-   rates         rates
                                 presented                 
Adjusted operating   228.7         244.8         -6.6%        -5.9%
cash flow
Adjusted operating   6.1%          6.4%                      
cash flow margin
Operating income     154.8         210.2         -26.3%       -25.9%
Operating income     4.1%          5.5%                      
margin
                                                          
Adjusted operating   202.8         121.2         67.5%        68.0%
income *

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

Adjusted operating cash flow decreased -5.9% at constant exchange rates (-6.6%
at current consolidation scope and exchange rates) to €228.7 million for the
year ended December 31, 2013, compared with re-presented €244.8 million for
the year ended December 31, 2012.

The decline in adjusted operating cash flow was mainly attributable to the
unfavorable regulatory factors that led to the forseen end of Gas Cogeneration
contracts in France. The net impact of the cost reduction plans helped to
absorb the impacts of commercial portfolio attrition.

Adjusted operating income rose to €202.8 million for the year ended December
31, 2013, compared with re-presented €121.2 million for the year ended
December 31, 2012, due to the favorable contribution in equity-accounted
Dalkia International activities:

  *the development of China’s Harbin network (mainly in line with new
    connections);
  *the turnaround of results in Spain and Italy following restructuring
    measures implemented and the absence of impairment on receivables and
    accrued expenses in Italy which had been recognized in 2012 for €65.1
    million (or €81.5 million before taxes).

Operating income declined due to :

  *net charges to operating provisions which totaled -€2.6 million for the
    year ended December 31, 2013, compared with re-presented €13.0 million for
    the year ended December 31, 2012, in connection with the settlement of
    disputes in 2012;
  *the negative differential of divestiture capital gains or losses relating
    to the Group’s asset optimization policy.

Furthermore, net charges to operating depreciation and amortization totaled
-€89.9 million for the year ended December 31, 2013, compared with
re-presented -€97.0 million for the year ended December 31, 2012.

Overall, the operating income margin fell from re-presented 5.5% for the year
ended December 31, 2012 to 4.1% for the year ended December 31, 2013.

OTHER SEGMENTS

The “Other Segments” division groups together certain industrial multi-service
contracts and the various Group holding companies:

REVENUE

Year ended  Year ended                                        
December     December 31,      % Change    Internal     External    Foreign
31,                                        growth       growth
2013         2012              2013/2012                            exchange
             re-presented                                           impact
(€          (€ million)                                     
million)
260.9       178.7            46.0%      -4.2%       50.2%      0%

The external growth in “Other Segments” revenue was primarily due to the
acquisition of the 50% stake held by the Fomento de Construcciones y Contratas
(FCC) Group in Proactiva Medio Ambiente, resulting in the full consolidation
of Proactiva as from November 28, 2013.

OPERATING PERFORMANCE

(€ million)          For the year  For the year  % change at  % change at
                      ended          ended          current       constant
                      December       December       exchange      exchange
                      31, 2013       31, 2012 re-   rates         rates
                                 presented                 
Adjusted operating   (112.2)       (91.0)        -23.3%       -23.3%
cash flow
Adjusted operating   NA            NA                        
cash flow margin
Operating income     (111.1)       (152.9)       27.3%        27.3%
Operating income     NA            NA                        
margin
                                                          
Adjusted operating   (92.3)        (127.0)       27.4%        27.4%
loss *

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

Adjusted operating cash flow decreased by -23.3% at constant and current
exchange rates to -€112.2 million for the year ended December 31, 2013,
compared with re-presented -€91 million for the year ended December 31, 2012.

This decline over the period was primarily due to the impact of the Veolia
Environnement voluntary departure plan.

The adjusted operating loss amounted to -€92.3 million for the year ended
December 31, 2013, compared with a re-presented loss of -€127.0 million for
the year ended December 31, 2012 (i.e. a 27.4% variation at current and
constant consolidation scope and exchange rates). In addition to the decline
in adjusted operating cash flow, this change was attributable to the reversal
of senior executive pension provisions in Veolia Environnement SA for €40.3
million following the closure of the senior executive defined benefit pension
plan.

Net charges to operating provisions totaled €51.4 million for the year ended
December 31, 2013, compared with re-presented -€10.5 million for the year
ended December 31, 2012, in connection with the reversal of the aforementioned
provision.

Net charges to operating depreciation and amortization totaled -€51.3 million
for the year ended December 31, 2013, compared with re-presented -€48.5
million for the year ended December 31, 2012.

RECONCILIATION OF PREVIOUSLY PUBLISHED AND RE-PRESENTED DATA FOR THE YEAR
ENDED DECEMBER 31, 2012

                  Year                                              Year
                   ended                                                 ended
€ million          December    IFRS5((1))    IFRS 10 &     IAS 19r       December
                                             11
                   31, 2012    restatement   restatement   restatement   31, 2012
                   published                                             re-
                                                                         presented
                                                                   
Revenue            29,439                  (6,200)                  23,239
Adjusted
operating cash     2,723                   (804)                    1,919
flow
Operating income   1,095                   (395)        11           711
Operating income
after share of
net income         1,095       (22)         (384)        10           699
(loss) of
equity-accounted
entities ^(2)
Adjusted
operating income   1,194       (22)         (384)        10           798
^(3)
Net income ^(4)    394                     8            2            404
Adjusted net       60          (36)         29           6            59
income ^(4)
Gross              3,282                   (629)                    2,653
investments
Free cash flow     3,673                   (1,763)                  1,910
Net financial      11,283                  (461)                    10,822
debt
Loans granted to                           +2,985                   2,985
joint ventures
Adjusted net       -           -            -                        7,837
financial debt

(1) Berlin Wasser

(2) Including the re-presented share of net income (loss) of joint ventures
and associates for the year ended December 31, 2012

(3) Including the re-presented share of adjusted net income (loss) of joint
ventures and associates for the year ended December 31, 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 of net
income 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
    divestitures that substantially change the economics of one or more
    cash-generating units;
  *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, share of net income of other equity-accounted entities and
    certain special items. Special items include items such as gains and
    losses from asset divestitures that substantially change the economics of
    one or more cash-generating units;

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 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
    divestitures (purchases of intangible assets and property, plant and
    equipment net of divestitures), 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.

  *The return on capital employed is defined as the ratio of:

       *net income from operations after tax, plus the share of net income
         from associates, less net operational income, after tax, from
         operating financial assets (return on operating financial assets net
         of tax allocated to this activity), to
       *average capital employed during the year, where
       *capital employed excludes operating financial assets and net income
         from operations excludes the related income.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION: ASSETS

                            As of           As of           As of
                   As of      December         December         January 1,
                   December   31, 2012         31, 2011         2011
                   31, 2013   re-              re-              re-
(€ million)                presented((1))  presented((1))  presented((1))
Goodwill          3,486.3   3,911.9         4,796.2         5,585.5
Concession
intangible        2,099.3   2,373.1         2,219.3         1,963.9
assets
Other intangible  719.3     926.3           1,014.9         1,206.7
assets
Property, plant   4,160.5   4,706.3         6,497.4         8,109.6
and equipment
Investments in    2,905.1   2,914,.8        3,167.1         3,066.1
joint ventures
Investments in    385.0     477.7           360.8           371.1
associates
Non-consolidated  40.5      47.0            65.4            71.2
investments
Non-current
operating         1,698.1   2,215.9         2,091.5         2,209.2
financial assets
Non–current
derivative        258.3     280.0           745.0           621.6
instruments -
Assets
Other
non-current       2,492.0   2,441.3         2,864.6         2,434.8
financial assets
Deferred tax      859.2     1,018.7         1,065.0         1,588.7
assets
Non-current       19,103.6  21,313.0        24,887.2        27,228.4
assets
Inventories and   434.5     614.9           664.5           725.1
work-in-progress
Operating         6,944.1   8,573.8         8,836.5         9,887.5
receivables
Current
operating         97.9      167.0           165.2           187.9
financial assets
Other current     628.0     1,488.6         978.9           290.1
financial assets
Current
derivative        60.7      45.4            49.6            36.1
instruments –
Assets
Cash and cash     4,274.4   4,998.0         5,025.4         4,754.9
equivalents
Assets
classified as     4,698.9   1,276.0         460.0           699.1
held for sale
Current assets    17,138.5  17,163.7        16,180.1        16,580.7
TOTAL ASSETS      36,242.1  38,476.7        41,067.3        43,809.1

(1) The consolidation standards and the IAS 19 revised Employee Benefits
standard hereafter provide for mandatory retrospective application with effect
from accounting periods commencing on or after January 1, 2013. The
consolidated financial statements for comparative periods have been
re-presented accordingly.

Furthermore, pursuant to IFRS 5.28 and IAS 28.21, the Group amended,
retrospectively, the presentation of its investment in Transdev Group, which
has been transferred from “Securities classified as held for sale” to
“Investments in joint ventures, equity accounted”.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION: EQUITY AND LIABILITIES

                            As of           As of           As of
                  As of       December         December         January 1,
                  December    31, 2012         31, 2011         2011
                  31, 2013    re-              re-              re-
(€ million)                presented((1))  presented((1))  presented((1))
Share capital    2,744.4    2,610.4         2,598.2         2,495.6
Additional       7,851.1    8,466.3         9,796.2         9,514.9
paid-in capital
Reserves and
retained
earnings         (2,390.3)  (3,970.5)       (5,386.9)       (4,211.0)
attributable to
owners of the
Company
Total equity
attributable to  8,205.2    7,106.2         7,007.5         7,799.5
owners of the
Company
Total equity
attributable to  1,478.2    1,391.4         1,532.8         1,804.6
non-controlling
interests
Equity           9,683.4    8,497.6         8,540.3         9,604.1
Non-current      1,698.1    1,792.9         1,793.8         2,041.0
provisions
Non-current      9,496.8    12,131.3        14,213.3        15,344.7
borrowings
Non–current
derivative       144.0      186.8           156.8           163.8
instruments –
Liabilities
Deferred tax     801.1      1,010.3         1,465.1         1,699.3
liabilities
Non-current      12,140.0   15,121.3        17,629.0        19,248.8
liabilities
Operating        7,929.9    9,562.8         9,897.8         11,188.1
payables
Current          439.7      466.7           533.6           634.7
provisions
Current          2,912.8    3,606.1         3,753.2         2,370.5
borrowings
Current
derivative       37.9       73.6            85.0            51.1
instruments –
Liabilities
Bank overdrafts
and other cash   216.1      252.7           390.5           339.6
position items
Liabilities
directly
associated with  2,882.3    895.9           237.9           372.2
assets
classified as
held for sale
Current          14,418.7   14,857.8        14,898.0        14,956.2
liabilities
TOTAL EQUITY     36,242.1   38,476.7        41,067.3        43,809.1
AND LIABILITIES

(1) The consolidation standards and the IAS 19 revised Employee Benefits
standard hereafter provide for mandatory retrospective application with effect
from accounting periods commencing on or after January 1, 2013. The
consolidated financial statements for comparative periods have been
re-presented accordingly.

Furthermore, pursuant to IFRS 5.28 and IAS 28.21, the Group amended,
retrospectively, the presentation of its investment in Transdev Group, which
has been transferred from “Securities classified as held for sale” to
“Investments in joint ventures, equity accounted”.

CONSOLIDATED INCOME STATEMENT

                                   Year ended December 31,
(€ million)                        2013^(1)    2012^(1) (3)  2011 ^(1) (3)
                                                 re-presented   re-presented
Revenue                            22,314.8    23,238.9      22,482.4
o/w Revenue from operating         175.9       184.4         188.4
financial assets
Cost of sales                      (18,959.9)  (19,563.0)    (18,881.3)
Selling costs                      (536.0)     (532.9)       (516.7)
General and administrative         (2,441.9)   (2,537.0)     (2,568.5)
expenses
Other operating revenue and        113.5       105.3         56.1
expenses
Operating income                   490.5       711.3         572.0
Share of net income (loss) of      178.7       (11.9)        (136.5)
equity-accounted entities
o/w share of net income (loss) of  160.3       (36.3)        (110.6)
joint ventures
o/w share of net income (loss) of  18.4        24.4          (25.9)
associates
Operating income after share of
net income (loss) of               669.2       699.4         435.5
equity-accounted entities
Finance costs                      (622.6)     (716.0)       (694.1)
Income from cash and cash          46.4        71.8          102.0
equivalents
Other financial income and         38.0        50.8          53.5
expenses
Income tax expense                 (128.3)     (52.9)        (439.1)
Share of net income (loss) of      (51.5)      (45.3)        (470.9)
other equity-accounted entities
Net income (loss) from continuing  (48.8)      7.8           (1 013.1)
operations
Net income (loss) from             27.3        431.8         582.7
discontinued operations
Net income for the year            (21.5)      439.6         (430.4)
Attributable to owners of the      (135.3)     404.0         (488.1)
Company
Attributable to non-controlling    (113.8)     (35.6)        (57.7)
interests in euros
(in euros)                                                 
NET INCOME (LOSS) ATTRIBUTABLE TO
OWNERS OF THE COMPANY PER SHARE                            
^(2)
Diluted                            (0.29)      0.79          (0.99)
Basic                              (0.29)      0.79          (0.99)
NET INCOME (LOSS) FROM CONTINUING
OPERATIONS ATTRIBUTABLE TO OWNERS                          
OF THE COMPANY PER SHARE ^ (2)
Diluted                            (0.32)      (0.15)        (2.16)
Basic                              (0.32)      (0.15)        (2.16)
NET INCOME (LOSS) FROM
DISCONTINUED OPERATIONS                                    
ATTRIBUTABLE TO OWNERS OF THE
COMPANY PER SHARE ^(2)
Diluted                            0.03        0.94          1.17
Basic                              0.03        0.94          1.17

(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, i.e. water activities
in Morocco and global urban lighting activities (Citelum);

-discontinued operations divested, i.e. European wind energy activities
divested in February 2013; the share of net income (loss) of the associate
Berlin Water to December 2, 2013; 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; U.S. wind energy activities divested in December 2012; household
assistance services (Proxiserve), divested in December 2011 and Environmental
Services Division activities in Norway, divested in March 2011;

are presented in a separate line, Net income (loss) from discontinued
operations, for the years ended December 31, 2013, 2012 and 2011.

Furthermore, the contribution of the Transdev Group was transferred to
continuing operations for fiscal years 2013, 2012 and 2011.

(2) The weighted average number of shares outstanding at December 31, 2013, is
523.5 million (basic and diluted).

Basic earnings per share is calculated by dividing adjusted net income
attributable to owners of the Company by the weighted average number of
ordinary shares outstanding during the fiscal year. Pursuant to IAS 33.19 and
IAS 12, 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.

(3) The consolidation standards and the revised IAS 19 Employee Benefits
standard presented hereafter provide for mandatory retrospective application
with effect from accounting periods commencing on or after January 1, 2013.
The consolidated financial statements for comparative periods have been
re-presented accordingly.

CONSOLIDATED STATEMENT OF CASH FLOWS

                                     Year ended December 31,
(€ million)                          2013       2012 ^(2)     2011^(2)
                                                  re-presented   re-presented
Net income for the year              (21,5)     439.6         (430.4)
Operating depreciation,
amortization, provisions and         1,507.0    1,472.8       1,616.1
impairment losses
Financial amortization and           19.3       (4.1)         (2.8)
impairment losses
Gains/losses on disposal and         (181.4)    (710.1)       (608.0)
dilution
Share of net income (loss) of joint  (109.3)    60.1          572.1
ventures
Share of net income (loss) of        (28.0)     (29.0)        24.7
associates
Dividends received                   (3.1)      (3.3)         (2.8)
Finance costs and finance income     599.6      680.1         632.2
Income tax expense                   133.8      151.1         471.0
Other items                          54.0       115.9         75.3
Operating cash flow before changes   1,970.4    2,173.1       2,347.4
in working capital
Changes in operating working         (4.3)      31.4          (224.1)
capital
Income taxes paid                    (203.1)    (226.2)       (240.5)
Net cash from operating activities   1,763.0    1,978.3       1,882.8
Including Net cash from operating
activities of discontinued           65.9       160.7         132.8
operations ^(1)
Industrial investments               (1,226.9)  (1,680.7)     (1,567.3)
Proceeds on disposal of intangible
assets and property plant and        120.2      94.1          117.0
equipment
Purchases of investments             (79.8)     (123.0)       (107.1)
Proceeds on disposal of financial    807.1      2,827.2       1,784.8
assets (*)
Operating financial assets                                  
New operating financial assets       (224.2)    (249.5)       (182.5)
Principal payments on operating      202.1      181.0         232.2
financial assets
Dividends received (including
dividends received from joint        115.2      123.3         135.7
ventures and associates)
New non-current loans granted        (698.3)    (141.1)       (1,089.2)
Principal payments on non-current    307.3      26.6          100.4
loans
Net decrease/increase in current     345.7      (19.5)        (260.1)
loans
Net cash used in investing           (331.6)    1,038.4       (836.1)
activities
Including Net cash used in
investing activities of              610.9      2,413.2       205.6
discontinued operations ^(1)
Net increase/decrease in current     (1,389.0)  (1,027.0)     (4.0)
borrowings
New non-current borrowings and       164.0      1,065.6       502.6
other debts
Principal payments on non-current    (1,577.1)  (1,593.7)     (261.5)
borrowings and other debts
Proceeds on issue of shares          13.2       9.1           (2.8)
Share capital reduction              -          -             -
Transactions with non-controlling    (15.3)     (106.8)       (44.9)
interests: partial purchases
Transactions with non-controlling    2.7        (2.2)         0.1
interests: partial sales
Proceeds on issue of deeply          1,470.2    -             -
subordinated securities
Coupons on deeply subordinated       (16.6)     -             -
securities
Purchases of/proceeds from treasury  -          -             2.2
shares
Dividends paid                       (191.3)    (434.3)       (403.0)
Interest paid                        (693.1)    (697.2)       (600.2)
Net cash used in financing           (2,232.3)  (2,786.5)     (811.5)
activities
Including Net cash used in
financing activities of              (62.1)     107.6         (63.1)
discontinued operations (1)
NET CASH AT THE BEGINNING OF THE     4,745.3    4,634.9       4,415.3
YEAR
Effect of foreign exchange rate      113.9      (119.8)       (15.6)
changes and other
NET CASH AT THE END OF THE YEAR      4,058.3    4,745.3       4,634.9
Cash and cash equivalents            4,274.4    4,998.0       5,025.4
Bank overdrafts and other cash       216.1      252.7         390.5
position items
NET CASH AT THE END OF THE YEAR      4,058.3    4,745.3       4,634.9

^(*) Proceeds on disposal of financial assets in the Consolidated Cash Flow
Statement include financial disposals, cash and cash equivalents, bank
overdrafts and other cash position items removed from the scope of
consolidation.

In 2013, this amount includes, in particular, the divestiture of Berlin Water
in the amount of €636 million, including the repayment of the VW Deutschland
financial receivable for €547.7 million.

In 2012, this amount included, in particular, the disposal of regulated Water
activities in the United Kingdom (€1,230 million) and solid waste activities
in the United States in the Environmental Services Division (€1,461 million).

(1) Net cash flows attributable to discontinued operations as defined in IFRS
5 primarily concern:

a. Norwegian activities in the Environmental Services Division, divested in
March 2011;0
b. Household assistance services (Proxiserve), divested in December 2011;
c. Regulated Water activities in the United Kingdom divested in June 2012;
d. Solid waste activities in the United States in the Environmental Services
Division, divested in November 2012;
e. U.S. wind energy activities, divested in December 2012;
f. European wind energy activities, divested in February 2013;
g. The Berlin Water associate to December 2, 2013;
h. Water activities in Morocco;
i. Global urban lighting activities (Citelum).

(2) The consolidation standards and the revised IAS 19 Employee Benefits
standard hereafter provide for mandatory retrospective application with effect
from accounting periods commencing on or after January 1, 2013. The
consolidated financial statements for comparative periods have been
re-presented accordingly.

Contact:

Veolia Environnement
Press
Laurent Obadia – Sandrine Guendoul, + 33 (0)1 71 75 12 52
or
Analysts and Investor Relations
Ronald Wasylec, +33 (0)1 71 75 12 23
Ariane de Lamaze, +33 (0)1 71 75 06 00
Terri Anne Powers (USA), +1312552 2890
 
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