Veolia profit hit by German goodwill impairment
PARIS (Reuters) - French water and waste group Veolia Environnement (VIE.PA) reported first-half net profit plunged to 4 million euros ($5.3 million) from 162 million in the year-earlier period due to goodwill impairments and restructuring charges.
The company's net profit was hit by goodwill impairments on its environmental services division in Germany, restructuring charges associated with its voluntary redundancy plan and costs associated with the buyback of bonds.
Chief Executive Officer Antoine Frerot told an earnings teleconference on Monday the company did not expect to book further extraordinary charges, except possible charges linked to its restructuring.
The company also confirmed its earnings objectives for 2013 and said it would aim for organic revenue growth of over three percent per year after 2013.
Sales fell 3.3 percent to 11.07 billion euros from 11.45 billion.
Veolia Chief Financial Officer Pierre-François Riolacci said business conditions in Europe had stabilised at the beginning of the second half.
"While we do not expect a rebound of business activity, we do not expect a further slowdown either," he said.
He said Veolia was closely monitoring China, where economic growth is slowing down.
"We are watching the impact of this slowdown on the world economy. It could impact us directly, especially via raw materials prices," Riolacci said.
Frerot said that outside Europe, the company was beginning to see new orders in the water business, which the company had not seen since the start of the financial crisis.
He also said that Veolia's toxic waste treatment business was going strong.
Veolia shares were up two percent in opening trade, outperforming France's CAC 40 .FCHI index, which was up 0.14 percent.
($1 = 0.7528 euros)
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