Key Figures for the period ending March 31st, Conference call May 3, 2018

Transcription

1 Key Figures for the period ending March 31st, 2018 Conference call May 3, 2018

2 Disclaimer Veolia Environnement is a corporation listed on the Euronext Paris. This document contains forward-looking statements within the meaning of the provisions of the U.S. Private Securities Litigation Reform Act of 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 other risks described in the documents Veolia Environnement has filed with the Autorités des Marchés Financiers (French securities regulator). 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 from Veolia Environnement a free copy of documents it filed ( with the Autorités des Marchés Financiers. This document contains "non GAAP financial measures". These "non GAAP financial measures" might be defined differently from similar financial measures made public by other groups and should not replace GAAP financial measures prepared pursuant to IFRS standards. Unaudited key figures 2

3 1Q 2018 key figures Highlights 3

4 1Q 2018 Key Takeaways : A good Start to the Year Delivering on our Growth Ambitions o Very solid 1Q 2018 Results o Revenue Growth well above expectations : +7.0% at constant FX (1) and +5.4% like for like o Strong EBITDA Growth : +5.3% at constant FX (2) o Current Net income of 193M, up +31.8% at constant FX and +8% excluding capital gains o FY 2018 Guidance fully Confirmed (1) Revenue up +5.6% at constant FX including the loss of Gabon (as if not discontinued) (2) EBITDA up +3.3% at constant FX including the loss of Gabon (as if not discontinued) 4

5 1Q 2018 Key Takeaways : A good Start to the Year Delivering on our Growth Ambitions Accelerated revenue growth : +7.0% at constant FX (1) to 6,419M 6 th quarter in a row of strong growth Organic growth of +5.4% after +3.5% in 2017 Robust commercial momentum and good waste volumes Limited impact of recycled prices (impact of -0.3% on revenue) French Water improving again with better tariff indexation and satisfactory contract renegotiations (in Water and Waste) Sustained growth in Europe Double digit growth in Rest of World Strong results performance : EBITDA up 5.3% at constant FX to 876M (2) driven by Revenue growth and Efficiency gains o Current EBIT +6.9% YTD at constant FX to 448M o o Current net income of 193M, up 31.8% at constant FX and +8% excluding capital gains Net financial debt of 8,213M and 9,665M including hybrid to be repaid (1) Revenue up +5.6% at constant FX including the loss of Gabon (as if not discontinued) (2) EBITDA up +3.3% at constant FX including the loss of Gabon (as if not discontinued) 5

6 Strong growth in Veolia new businesses Difficult pollutions Toxic Waste, Industrial waste water, illicit landfills Circular Economy Plastic Recycling, chemical products, irrigation, fish farming Energy Management : Clean, Renewable, Efficient Waste to Energy, Biogas, RDF, Biomass, capture of methane Ambitious cities Resilient, livable, inclusive, smart Contribution of new businesses o 30% of Total Revenue o More than 50% of Revenue Growth 6

7 Sustained pace of cost savings: 70M achieved as of March 2018, on track with annual objective Impact on EBITDA (in M) target 1Q Q Revised target Cost savings France 12% 25% 20% 33% Purchasing Europe excluding France 15% Rest of the World Operations Global Businesses HQ 20% 28% 47% SG&A 7

8 outlook 2018 objectives (at constant exchange rates): Continuation of sustained revenue growth EBITDA growth greater than that of 2017 More than 300M in cost savings 2019 objectives (1) : Continuation of revenue growth and full impact of cost savings EBITDA between 3.3Bn and 3.5Bn (excluding IFRIC 12), i.e. between 3.5Bn and 3.7Bn including IFRIC 12 Dividend growth in line with that of current net income (1) At constant exchange rates (based on rates at the end of 2016) 8

9 1Q 2018 key figures Key figures for the period ended March 31st,

10 Strong 1Q 2018 performance driven by continued solid revenue growth and EBITDA growth In M Operations in Gabon discontinued from Jan (IFRS 5) 1Q 2017 : Revenues 79M - EBITDA 16M Current EBIT 2M Current net income 0.5M 1Q 2017 published 1Q2017 for IFRS 5 & IFRS9 (1) 1Q 2018 Var. Y-Y vs. 1Q2017 constant FX vs. 1Q2017 constant FX vs. 1Q2017 incl. Gabon Revenue 6,270 6,191 6, % +7.0% (2) +5.6% EBITDA % +5.3% +3.3% EBITDA margin 13.8% 13.7% 13.6% Current EBIT (3) % +6.9% +6.4% Current Net Income Group share % +31.8% +31.4% Current Net Income Group share excluding capital gains % +8.0% +7.6% Gross industrial Capex Net FCF (4) Net financial debt 8,430 8,418 8,213 Net financial debt including hybrid 9,882 9,870 9,665 (1) See Appendix 1 (2) +5.4% at constant scope and forex (3) Including the share of current net income of joint ventures and associates of entities viewed as core Company activities (excluding Transdev which is no longer considered a core Group activity). (4) Net free cash flow corresponds to the free cash flow of continuing operations, i.e. the sum of EBITDA, dividends received, operating cash flow from financing activities, and the variation of operating working capital, less net industrial investments, net interest expense, tax expense, restructuring charges, other non current expenses and renewal expenses. Summary of FX impacts (vs. 1Q2017) M % Revenue % EBITDA % Current EBIT % Current Net Income % Net debt vs. Dec % Net debt vs. March % 10

11 Continued very strong revenue growth in 1Q 2018: +7.0% at constant FX (and +5.4% lfl) driven by International at constant FX Q1 Q2 Q3 Q4 Year Q1 France -1.5% -0.4% -0.3% +1.9% -0.1% +0.6% Europe excl. France +7.2% +4.4% +8.1% +6.1% +6.4% +6.9% Rest of the World +11.8% +10.8% +9.4% +14.2% +11.6% +14.7% Global Businesses -3.2% +1.7% -2.7% +1.9% -0.4% +3.5% TOTAL +4.5% +4.4% +4.3% +6.3% +4.9% +7.0% Total excl. Construction & Energy prices +5.9% +4.1% +4.7% +5.0% +4.9% +4.6% EBITDA growth +0.9% -0.2% +4.8% +5.2% +2.7% +5.3% o Dynamics remain favorable: Continued improvement in French Water Acceleration of growth outside of France, particularly in the Rest of the World Improvement in Global Businesses, despite a slow start of the year at VWT (but with a backlog up 10% QoQ): strong hazardous waste and multi utility industrial activity 11

12 Continued very strong revenue growth in 1Q 2018: +7.0% at constant FX (and +5.4% lfl) driven by International REVENUE IN M 6,191 (1) 6,419 (1) 1,037 1,569 1,045 1,612 2,275 2,443 1,303 1,311 1Q2017 1Q2018 (1) Including Other: 7M in 1Q2017 and 8M in 1Q2018 (2) At constant Forex France: +0.6%: +2% in Water & Waste up 2% excluding impact of recycled materials prices WATER: Revenue up 2.2% : better price indexation (+0.6% vs. -0.3% in Q1, 2017) and net positive commercial effects (still a bit negative in Q1, 2017) more than offset lower volumes (-0.8%) WASTE: Revenue down 0.9% at constant scope due to lower recycled prices (impact -3.5% on revenue). Continued good volumes (+2.3%), notably landfills and commercial collection. Europe excluding France: Growth of 6.9% at constant FX: Good performance in all regions UK/IRELAND: Revenue +4.0% (2) to 518M due to excellent plant operational performance of PFIs (98% availability vs. 95% in March 2017), higher electricity prices, and continued solid commercial activity. Overall limited YTD price impact of recyclates, lower fiber prices offset by other materials NORTHERN EUROPE: Revenue +11.8% to 702M : mostly impact of 2017 tuck-ins in Nordics, Netherlands and Germany in Recycling and Industrial Waste Germany +4% : negative impact of paper price decline (- 6M) partially offset by plastics; higher energy prices compensated by mixed volumes (no positive weather impact) CENTRAL & EASTERN EUROPE: Revenue +6.3% (2) to 946M due to strong ENERGY REVENUE: higher volumes and prices driven by cold weather Small acquisitions in WASTE - Price increases in WATER Rest of the World: Growth of 14.7% at constant FX: Strong growth in all geographies NORTH AMERICA: Revenue +10.1% (2) to 505M and +19% organic (divestiture of IS closed on Feb 23) : very strong growth in Energy (+41% (2) ) due to cold weather (higher heat and electricity prices and volumes) ; numerous contract wins in energy efficiency (Du Pont contract), industrial water and hazardous waste Strong growth in LATIN AMERICA (Revenue +22.5% (2) to 183M): tariff increases & new contracts ASIA (Revenue +21.1% at constant FX to 453M) o/w +14.7% in China (strong waste volumes, haz. waste and landfills), DHN extensions in Harbin, new industrial contracts Confirmed growth in AUSTRALIA-NZ (+13.1% (2) to 252M): new assets in Waste (Woodlawn MBT) and construction of Springale WW treatment plant Global Businesses: +3.5% at constant FX: Strong hazardous waste offset by weak construction CONSTRUCTION: -2.4% (2) : VWT revenue down due to late bookings in 2017, but backlog is 10% higher than 1Q2017 SADE up yoy: continued strong growth in France and pursuit of restructuring international HAZARDOUS WASTE: +7.6% (2) : good start to the year in all activities despite adverse weather Variations vs. 1Q2017 Δ Δ at constant FX France +0.6% +0.6% Europe excluding France +7.4% +6.9% Rest of the World +2.8% +14.7% Global Businesses +0.9% +3.5% Total +3.7% +7.0% 12

13 in M Continued very strong revenue growth in 1Q 2018: +7.0% at constant FX (and +5.4% lfl) Like-for-like growth : +5.4% FX & SCOPE: FX - 204M: mostly $ related - SCOPE : + 95M o/w 2017 tuck-in impact (Recycling and Industrial Waste in Sweden and in Germany, Energy Services in Korea ) partly offset by the divestiture of industrial Services in the US closed in Feb (- 41M impact in 1Q, 2018) ENERGY & RECYCLATE PRICES: + 50M : Recyclate impact:- 20M : o/w Paper Prices - 26M (prices down 20 % in Q1 with market prices down 37% in France and Germany (see slide 15)) partially offset by Plastic prices (avg selling price +5% YOY in our key countries) Energy Prices : + 70M mostly in the US FAVORABLE VOLUMES & COMMERCE IMPACTS :+ 212M Volumes + 148M : Continued growth of waste volumes in Europe and ROW, and strong Hazardous waste Solid construction activity, in ROW mostly (Asia, Pacific, Middle East), slow start of the year at VWT but good activity of Sade in France Weather: + 17M in CEE & US Commerce : + 47M mostly in the US, Latam, Asia and Toxic waste. PRICE EFFECTS: + 47M : mostly Asia, Latam (waste), CEE (increase in water tariffs) 13

14 Solid growth in Waste: +9.6% at constant FX (+4.3% like-for-like) : Continued strong volume momentum partly offset by recyclate prices 1Q 2018 Recycled raw materials prices -0.8% Volumes / activity levels +3.0% Service price increases +1.1% Other +1.0% Growth at constant scope & exchange rates +4.3% Scope effect +5.3% Growth at constant exchange rates +9.6% Currency effect -4.4% France: Revenue down 0.9% at constant scope to 598M: Good volume trends notably in landfills and commercial collection Recycled raw materials impact: -3.5% UK/Ireland: Revenue up 4.5% at constant FX to 428M VOLUME/ COMMERCE: Continued benefit from contract wins, excellent PFI performance (availability rate of 98%) and main waste landfilled volumes still up Germany revenue up 9.3% to 272M North America : Revenue up 7.2% at constant scope and FX to 190M : good volumes and prices at RGS and strong Hazardous waste - IS divested since Feb Pacific revenue up 8.9% at constant FX to 185M: pursuit of recovery, with the benefit of the Woodlown MBT new facility and good volumes 14

15 A limited recyclate paper impact Recycled paper account for less than 2% of the Group s Revenue and less of the Group s EBITDA* o Chinese ban: Sharp decline of Paper and cardboard prices due to a higher selection of paper grades since January o Temporary oversupply in Europe => pressure on prices o China has released new import quotas in April o Limited Veolia exposure o Limited export volumes to China o Our recycled papers comply with Chinese criteria Breakdown of Waste Revenues (2017, in M) 1, o Q1, 2018 impact o Average market price decline (France (1) & Germany (2) ) of 37% o Average Veolia selling price decline of 20% o Revenue impact : - 26M (o/w 2/3 in France) o EBITDA impact : - 5M 9,040 o/w Sorting & Recycling (Services) o/w Sale of Recycled Papers Other Recyclates (1) Average French Copacel paper price of 81.6/T vs /T in 1Q2017 (-37%) Average 2017 price of 126/T (2) Average German EUWID paper price of 42.8/T vs /T in 1Q2017 (-38%) Average 2017 price of 75.7/T *In

16 Strong EBITDA Growth driven by Revenue Growth and Efficiency gains EBITDA up +5.3% at constant FX to 876M France: Sustained performance improvement offset by negative impact of lower paper prices in Waste WATER: EBITDA up, driven by good revenue evolution & Efficiency gains WASTE: EBITDA down due to paper prices decrease Rest of Europe: good operational performance offset by transitory price cost squeeze in energy CENTRAL & EASTERN EUROPE: EBITDA down due to higher fuel cost (temporary pinching due mostly to higher fuel prices) partly offset by efficiency gains and small but favorable weather impact. UK: EBITDA sharply up : impact of new contracts, excellent operational efficiency NORTHERN EUROPE: Double digit growth : mostly 2017 scope and continued efficiency gains Continued strong growth in the Rest of the World Continued double digit growth in ASIA driven by revenue expansion LATIN AMERICA: EBITDA growth due to good commercial activity and continued cost cutting The PACIFIC region improved significantly: new industrial investments and good volumes in waste NORTH AMERICA: EBITDA strongly up : favorable weather in Energy driving energy prices, spark spreads and volumes. Global Businesses: Strong hazardous waste offset by slow start of the year at VWT 16

17 Strong EBITDA Growth driven by Revenue Growth and Efficiency gains EBITDA up 5.3% YTD at constant FX to 876M in M FX & SCOPE: FX - 16M (mostly $) - SCOPE : + 17M mostly 2017 tuck-ins (Recycling and Industrial Waste in Sweden and in Germany etc.) COMMERCE/VOLUMES : + 19M Continued growth in waste Volumes Weather: + 3M impact : favorable in the US mostly, and in CEE, partly offset by China Commerce : robust momentum ENERGY & RECYCLATE PRICES : - 13M : ENERGY : temporary pinching in CEE due to higher coal prices offset in the US by cold weather driving prices & spark spreads WASTE : negative impact of paper prices compensated by plastics and sulfuric acid price (US) PRICE COST SQUEEZE : - 28M : higher indexation of water & waste contracts but continued pressure on salary increases and other costs VERY FAVORABLE IMPACT FROM COST REDUCTIONS: + 70M 17

18 Current EBIT: +6.9% at constant FX In M 1Q2017 1Q2017 1Q2018 Δ vs. 1Q2017 Δ vs. 1Q2017 at constant FX EBITDA % +5.3% Renewal expenses Depreciation & Amortization (including principal payments on OFAs) Provisions, fair value adjustment & other (1) Current EBIT % +6.9% (1) Other include : share of current net income of joint ventures and associates and industrial capital gains. Provisions : net reversals for self insurance of + 12M in 1Q

19 Current net income up 31.8% at constant FX and +8.0% excluding capital gains in M % (1) % (2) -1 1Q Q 2018 Net Cap. Gains after tax Current Net Income excl. Capital gains (1) at constant forex (2) at constant forex and excluding capital gains o Cost of net financial debt down from - 103M to - 96M (benefits from active debt management) o Significantly lower other financial expense of - 7M (vs. - 40M) due to a higher contribution of net financial capital gains (+ 29M after tax, mostly from the divestiture of Industrial Services in the US). They also include charges related to the unwinding of the discount on provisions (- 8M) & IFRIC12 interest on operating assets (- 23M) o Minority Interests of - 64M (vs. - 63M), mostly in CEE in 1Q (energy business) o Current tax rate of 28% 19

20 Net FCF excluding WCR seasonality of + 402M in 1Q2018 o Gross industrial capex up 17%, in line with commercial development in M Q2017 repr. Discretionary growth capex 1Q2018 Maintenance and contractual capex o Net FCF (1) of - 398M vs M in 1Q2017 Excluding seasonal WCR variation (- 800M), net FCF amounted to + 402M in 1Q2018 in M o Net financial debt of 9,665M, and 8,213M excluding hybrid Down vs March 2017 (up 181M excl. favorable FX of 386M: due to 280M net financial acquisitions from March 2017 to March 2018) Up vs. December 2017 due to impact of WCR seasonality in M (1) Net free cash flow corresponds to the free cash flow of continuing operations, i.e. the sum of EBITDA, dividends received, operating cash flow from financing activities, and the variation of operating working capital, less net industrial investments, net interest expense, tax expense, restructuring charges, other non current expenses and renewal expenses. 20

21 outlook 2018 objectives (at constant exchange rates): Continuation of sustained revenue growth EBITDA growth greater than that of 2017 More than 300M in cost savings 2019 objectives (1) : Continuation of revenue growth and full impact of cost savings EBITDA between 3.3Bn and 3.5Bn (excluding IFRIC 12), i.e. between 3.5Bn and 3.7Bn including IFRIC 12 Dividend growth in line with that of current net income (1) At constant exchange rates (based on rates at the end of 2016) 21

22 Appendix

23 Appendix 1: Main figures (1) for the quarter ended March 31, 2017 IFRS 5 March 2017 In m Adjustment(3) published IFRS 9 Adjustment March 2017 Revenue 6269,8-78,6 0,0 6191,2 EBITDA 862,9-15,8-0,5 846,6 Current EBIT (2) 430,5-2,3-0,5 427,7 Operating income 420,6-2,3-0,5 417,9 Current net income - Group share 154,7-0,5-0,6 153,7 Gross industrial investments Net free cash flow Net financial debt (1) Non audited figures (2) Including the share of current net income of joint ventures and associates for the three months-ended March 31, 2017 (3) In order to ensure the comparability of periods, the accounts ending September 30, 2016 have been for the reclassification of the Group s activities in Gabon into Net income (loss) from discontinued operations in accordance with the application of the IFRS 5 standard. VEOLIA Main figures for the quarter ended March 31,

24 Appendix 1: Main figures for the full year ended March 31, 2017 (1) - Revenue by segment In m March 2017 published IFRS 5 Adjustment IFRS 9 Adjustment March 2017 France 1302,9 0,0 0,0 1302,9 Europe excluding France 2274,6 0,0 0,0 2274,6 Rest of the World 1647,9-78,6 0,0 1569,4 Global businesses 1036,6 0,0 0,0 1036,6 Other 7,7 0,0 0,0 7,7 Revenue 6269,8-78,6 0,0 6191,2 (1) Non audited figures VEOLIA Main figures for the quarter ended March 31,

25 Appendix 1: IFRS 9 Financial Instruments o As of January 1, 2018, the Group is applying the new IFRS 9 standard concerning financial instruments, replacing the application of former standards IAS 39. The new standard, IFRS 9, provides for a retroactive application of the classification and evaluation of financial assets and liabilities. Particularly for the Group, it also calls for new methodologies regarding the provisioning of trade receivables and a regularization of the amortized cost of bonds which have been re-negociated. o In the P & L, these restatements related to this new standard resulted in only insignificant impacts on EBITDA and current EBIT. VEOLIA Main figures for the quarter ended March 31,

26 Appendix 2: Currency movements Main currencies 1 = xxx foreign currency 1Q Q 2017 US dollar Average rate Closing rate UK pound sterling Average rate Closing rate Australian dollar Average rate Closing rate Chinese renminbi yuan Average rate Closing rate Czech crown Average rate Closing rate Q2018 vs. 1Q % 13.2% 2.6% 2.2% 10.1% 12.8% 6.4% 4.9% -6.4% -6.3% The average rate applies to the income statement and the cash flow statement The closing rate applies to the balance sheet 26

27 Appendix 3: Quarterly revenue by segment 1 st quarter 2 nd quarter 3 rd quarter In M at cst FX at cst scope & FX at cst FX at cst scope & FX at cst FX at cst scope & FX France 1,323 1, % +0.6% 1,365 1, % +2.2% 1,377 1, % +0.9% Europe excl. France 2,172 2, % +6.2% 1,911 1, % +2.4% 1,748 1, % +5.8% Rest of the World 1,426 1, % +6.0% 1,407 1, % +4.7% 1,514 1, % +5.0% Global Businesses 1,068 1, % -4.2% 1,151 1, % +3.4% 1,086 1, % -0.7% Other 6 7 Ns Ns 6 11 Ns Ns 8 7 Ns Ns Group 5,995 6, % +3.1% 5,840 6, % +3.2% 5,734 5, % +3.1% 4 th quarter Full year 1 st quarter In M at cst FX at cst scope & FX at cst FX at cst scope & FX at cst FX at cst scope & FX France 1,352 1, % +3.3% 5,418 5, % +1.8% 1,303 1, % +0.7% Europe excl. France 2,252 2, % +1.6% 8,083 8, % +3.9% 2,275 2, % +3.3% Rest of the World 1,682 1, % +10.5% 6,028 6, % +6.7% 1,569 1, % +14.4% Global Businesses 1,322 1, % +3.3% 4,626 4, % +0.6% 1,037 1, % +2.6% Other 11 4 Ns Ns % -8.8% Group 6,618 6, % +4.4% 24,187 25, % +3.5% 6,191 6, % +5.4% 27

28 Appendix 4: Quarterly revenue by business 1 st quarter 2 nd quarter 3 rd quarter In M at cst FX at cst scope & FX at cst FX at cst scope & FX at cst FX at cst scope & FX Water 2,635 2, % -0.9% 2,701 2, % +3.2% 2,700 2, % +0.1% Waste 2,014 2, % +5.6% 2,160 2, % +2.1% 2,143 2, % +4.9% Energy 1,346 1, % +7.1% 979 1, % +5.6% % +8.0% Group 5,995 6, % +3.1% 5,840 6, % +3.2% 5,734 5, % +3.1% 4 th quarter Full year 1 st quarter In M at cst FX at cst scope & FX at cst FX at cst scope & FX at cst FX at cst scope & FX Water 2,993 3, % +4.6% 11,029 11, % +1.8% 2,554 2, % +3.8% Waste 2,194 2, % +6.1% 8,510 9, % +4.7% 2,155 2, % +4.3% Energy 1,432 1, % +1.5% 4,648 4, % +5.2% 1,483 1, % +9.9% Group 6,618 6, % +4.4% 24,187 25, % +3.5% 6,191 6, % +5.4% 28

29 Appendix 5: Continued rebound in revenue: up 7.0% at constant FX to 6,419M : Analysis by business REVENUE IN M 6,191 2,554 2,154 2,562 2,268 1,483 1,589 1Q2017 6,419 1Q2018 Water: +3.5% at constant FX, (+3.8% at constant scope & FX) Volumes/commerce: +0.5% o France: volumes down 0.8%; net positive commercial effect o Central Europe: volumes up 0.8% o Continued robust commercial momentum in Rest of the World Price effects* (+1.7%) : Indexation of +0.6% in France & higher tariffs in Czech Republic, Roumania & Bulgaria; higher energy prices at BVAG in Germany Construction (+1.6%): Solid construction activity, in ROW mostly (Asia, Pacific, Middle East) ; slow start of the year at VWT but good activity of Sade in France Strong growth in Waste: +9.6% at constant FX (+4.3% at constant scope & FX) Scope: +5.3%: acquisitions in Germany, Sweden & Asia in 2017 partly offset in 2018 by the divestiture of Industrial Services in the US (- 41M) Strong Volumes & Commerce : +3.0% o Continued growth in volumes: in France, (+2.3%), Rest of World in all regions (USA, Asia, Amlat, Pacific) and in hazardous waste o Commerce: strong renewal rate and contract awards (UK, Germany, Hazardous Waste) Price effects: +1.1% mainly in Latin America, Asia and the UK Decrease in recycled prices (-0.8%) Rebound in Energy Services: +9.0% at constant FX (+9.9% at constant scope & FX) Scope: (-0.9%): divestiture of FM activities in Sweden Weather impact: + 17M (+1.1%) Volumes / Commerce: (+2.5%): higher volumes of energy sold in Central Europe and China, start of new energy contracts in Canada, new industrial energy efficiency contracts (VIGS) Price effects (+3.5%) : mostly heat and electricity prices strongly up in the US * Including energy prices for BVAG Variations vs. 1Q 2017 constant FX constant FX & scope Water +0.3% +3.5% +3.8% Waste +5.3% +9.6% +4.3% Energy +7.2% +9.0% +9.9% Total +3.7% +7.0% +5.4% 29

30 Appendix 6: Quarterly waste revenue and volumes Quarterly revenue growth at constant scope & FX Y-Y Quarterly volume trends 30

31 Appendix 7: Waste Revenue vs. Industrial Production Weighted average industrial production indices for 4 key countries including SARP & SARPI : France, UK (excluding PFI), Germany,North America (excluding US Solid Waste and WTE) Sources: January and February: OECD for USA & UK, INSEE for France, Eurostat for Germany -March: same index as February for all the countries 31

32 Appendix 8: Recyclate paper prices (1/2) France Germany 32

33 Appendix 8: Recyclate paper prices (2/2) Long term evolution of paper and cardboard prices ( /T - France) 33

34 SUSTAINABLE DEVELOPMENT 2020 roadmap: 2017 results 34

35 Our 9 commitments for sustainable development SUSTAINABLY MANAGE NATURAL RESOURCES BY SUPPORTING THE CIRCULAR ECONOMY 1 CONTRIBUTE TO COMBATING CLIMATE CHANGE 2 PROMOTE AN ECO-FRIENDLY APPROACH TO CONSERVE BIODIVERSITY 3 BUILD NEW MODELS FOR RELATIONS AND VALUE CREATION WITH OUR STAKEHOLDERS 4 CONTRIBUTE TO LOCAL DEVELOPMENT 5 SUPPLY AND MAINTAIN SERVICES CRUCIAL TO HUMAN HEALTH AND DEVELOPMENT 6 GUARANTEE A HEALTHY AND SAFE WORKING ENVIRONMENT 7 ENCOURAGE THE PROFESSIONAL DEVELOPMENT AND COMMITMENT OF EACH EMPLOYEE 8 GUARANTEE RESPECT FOR DIVERSITY AND HUMAN AND FUNDAMENTAL SOCIAL RIGHTS WITHIN THE COMPANY 9 35

36 Our commitments for sustainable development 2020 roadmap: 2017 results (1/3) RESOURCING THE PLANET SUSTAINABLY MANAGE NATURAL RESOURCES BY SUPPORTING CIRCULAR ECONOMY 2020 TARGET: Achieve 3.8 billion in circular economy related revenue PERFORMANCE: 4.4 billion. CONTRIBUTE TO COMBATING CLIMATE CHANGE 2020 TARGET:. Achieve 100 million metric tons CO 2 equivalent of reduced emissions and 50 million metric tons CO 2 equivalent of avoided emissions for the period spanning from 2015 to Capture over 60% of methane from the landfills we operate PERFORMANCE:. 44 million metric tons CO 2 equivalent reduced and 18 million metric tons CO 2 equivalent avoided, since % of methane captured. PROMOTE AN ECO-FRIENDLY APPROACH TO CONSERVE BIODIVERSITY 2020 TARGET: Carry out a diagnosis and deploy an action plan in 100% of sites with significant biodiversity issues PERFORMANCE: Diagnosis and action plan in 54% of the sites identified. 36

37 Our commitments for sustainable development 2020 roadmap: 2017 results (2/3) RESOURCING THE REGIONS BUILD NEW MODELS FOR RELATIONS AND VALUE CREATION WITH OUR STAKEHOLDERS CONTRIBUTE TO LOCAL DEVELOPMENT SUPPLY AND MAINTAIN SERVICES CRUCIAL TO HUMAN HEALTH AND DEVELOPMENT 2020 TARGET: Have entered into a major partnership based on value creation in each zone and each growth segment PERFORMANCE: Examples of major partnerships signed: Danone, IBM, Huawei, Livelihoods, CCSL, Swiss Re TARGET: Maintain above 80% the percentage of Veolia s spending reinvested locally PERFORMANCE: 85.4% (average calculated for the principal areas representing 71% of 2017 revenue) TARGET: Contribute to the United Nations sustainable development goals, as we did to the Millennium Development Goals PERFORMANCE: 7.9 million people connected to a drinking water supply and more than 3.54 million to a sanitation service (1) (1) Since the definition of the Millenium Development Goals in 2000, the Group has helped 7.9 million people (703,535 in the year 2017) in developing and emerging countries to obtain access to drinking water and connected 3.54 million (232,435 in 2017) to sanitation services 37

38 Our commitments for sustainable development 2020 roadmap: 2017 results (3/3) VEOLIA S PEOPLE GUARANTEE A HEALTHY AND SAFE WORKING ENVIRONMENT 2020 TARGET: Achieve an accident at work frequency rate of 6.5 or less PERFORMANCE: Frequency rate: 9.55 (Frequency rate was reduced from in 2011 to in 2015) ENCOURAGE THE PROFESSIONAL DEVELOPMENT AND COMMITMENT OF EACH EMPLOYEE 2020 TARGET:. Provide training to over 75% of employees every year.. Maintain management s commitment rate at over 80% PERFORMANCE:. 72% of employees have undergone training.. Manager commitment rate: 86%. GUARANTEE RESPECT FOR DIVERSITY AND HUMAN AND FUNDAMENTAL SOCIAL RIGHTS WITHIN THE COMPANY 2020 TARGET: Achieve 95% of employees with access to social dialogue devices PERFORMANCE: Over 89% of employees covered by social dialogue arrangements. 38

39 Contacts Analyst & Investor Relations Ronald Wasylec Senior Vice President, Investor Relations Telephone : ronald.wasylec@veolia.com Ariane de Lamaze Vice President, Investor Relations Telephone : ariane.de-lamaze@veolia.com 30, rue Madeleine Vionnet Aubervilliers, France Media Relations Laurent Obadia Telephone : laurent.obadia.@veolia.com Sandrine Guendoul Telephone : sandrine.guendoul@veolia.com 30, rue Madeleine Vionnet Aubervilliers, France