Veolia Says Full-Year Profit Rose 22% on Acquisitions

Veolia Says Full-Year Profit Rose 22% on Acquisitions (Update1)

March 7 (Bloomberg) -- Veolia Environnement SA, the world's biggest water company, said full-year profit rose 22 percent, helped by acquisitions.

Net income climbed to 928 million euros ($1.43 billion) from 759 million euros a year earlier, the Paris-based company said today in an e-mailed statement. That missed a median estimate from seven analysts of 958 million euros.

Revenue was boosted by acquisitions including Cleanaway U.K., a British provider of waste-removal services, German trash-handler Sulo Group and TMT, the waste-management unit of Italy's Termomeccanica Ecologia. Veolia raised 2.6 billion euros in June in a sale of new shares to fund further purchases in areas such as water services.

The company supplies water to about 110 million people worldwide and collects and manages trash for about 50 million. It provides public transportation in at least 25 countries and is also developing airplane and ship dismantling and recycling businesses in France.

Veolia fell 39 cents, or 0.7 percent, to 54.96 euros in Paris yesterday. The stock has lost 12 percent so far this year.

Group sales climbed 14 percent last year to 32.6 billion euros, beating analyst estimates, Veolia said last month. Revenue at the utility's water unit advanced 8.3 percent to 10.9 billion euros, with new contracts in central Europe outweighing lower water sales in France.

Chinese Potential

Chief Executive Officer Henri Proglio has identified China as a growth area for the company. The utility has already signed 23 service contracts with Chinese cities for water and waste treatment, including a September agreement valued at 2.65 billion euros to supply drinking water to Tianjin for 30 years.

Revenue at Veolia's waste-management arm advanced 24 percent to 9.2 billion euros, in part because of ``strong'' price increases for recycled materials in France and additional sales from Cleanaway, Sulo and TMT, the company said last month.

Veolia also said in February it won a 25-year contract for 900 million euros to manage waste in London's Southwark borough.

Profit growth at the utility's transport business, Europe's largest private operator of public transport networks, has lagged behind its larger waste and water divisions. Proglio last month said the company will concentrate on public transport in cities rather than fast-train rail links between urban centers.

The division recorded a 13 percent increase in sales to 5.59 billion euros after Veolia acquired France's SNCM ferry company and developed transport networks in the French cities of Paris, Bordeaux, Nice and Toulon.

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