2006 Annual results

27 February 2007 - Finances

- Excellent performance in 2006:
    - Revenue⁽¹⁾: €26 billion (up 11%)
    - Operating profit from ordinary activities ⁽¹⁾: €2,669 million (up 13%)
    - Consolidated net profit⁽¹⁾: €1,277 million (up 31%)
    - Dividend⁽²⁾: €2.65 per share (up 33%)

- Favourable outlook for 2007:
    - Order book at high level: €18 billion (up 13% over 12 months)
-     Good prospects in European infrastructure market
    - Growth of public-private partnerships

- VINCI increases its holding in Cofiroute to 82.4%

VINCI’s Board of Directors, chaired by Yves-Thibault de Silguy, met on 27 February 2007, to approve the financial statements for the 12 months to 31 December 2006, which will be submitted for approval to the next Shareholders Meeting. The Board also examined the outlook for 2007 and approved VINCI’s acquisition of Eiffage’s holding in Cofiroute.

Good growth in revenue in all business lines, both in France and international markets

VINCI’s revenue⁽¹⁾ amounted to €26 billion in 2006, up 10.7% against 2005. This increase was due mainly to internal growth in the Group’s business lines.

In France, revenue⁽¹⁾ was €17.2 billion (up 10.8%) and accounted for 66% of total revenue.

Outside France, revenue⁽¹⁾ was €8.8 billion (up 10.5%).

Pro forma revenue ⁽¹⁾ by business line

 

Results ⁽¹⁾

Consolidated net profit attributable to equity holders of the parent company amounted to €1,277 million ⁽¹⁾, up 31% against that of 2005 restated on a comparable basis.

Based on actual data ⁽³⁾, 2006 net profit was €1,270 million, up 46% compared with the figure published in 2005 (€871 million). Despite the share capital increase in April 2006, earnings per share improved 24% to €5.55.

Net profit by business line

The rise in net profit reflects growth in operating profit, which is attributable to a higher level of business activity and to the good margins maintained by all business lines.

Net profit includes several non-recurring items (mainly the sale of non-strategic assets such as airport services) representing a net gain of €95 million.

Operating profit from ordinary activities by business line

Operating profit from ordinary activities ⁽¹⁾ amounts to €2,669 million, up 13% against the 2005 figure. It includes €268 million of amortisation of the goodwill allocated to ASF concession contracts.

VINCI Concessions’ operating profit from ordinary activities increased more quickly than revenue, reflecting the excellent results achieved by ASF-Escota and Cofiroute. The business line’s contribution represented almost 60% of total operating profit from ordinary activities.

With strong growth in business volume in both France and international markets, VINCI Construction maintained a high level of profitability, improving during the second half.

Eurovia’s good performance reflects the benefits of the recovery programme implemented in some subsidiaries outside France, as well as brisk business in France.

VINCI Energies, with profitability of over 5%, recorded an overall good performance.

The holding companies’ operating profit includes the gain on the sale of a property complex in Nanterre.

Financing and balance sheet items

Pro forma cash flow from operations ⁽¹⁾ increased 8% to €4 billion.

Concessions operations account for 66% of total pro forma cash flow from operations.

Growth investments in concessions amounted to €1.3 billion, of which €754 million at Cofiroute and €463 million at ASF and Escota.

The acquisition of 77% of ASF represented an investment of €9.1 billion, of which €3 billion financed by an increase in equity (€0.5 billion issue of perpetual subordinated bonds in February 2006 and a €2.5 billion share capital increase in April 2006).

Following these transactions, net financial debt amounted to €14.8 billion at 31 December 2006, compared with €1.6 billion at 31 December 2005. It includes the ASF group’s debt of almost €8 billion.

Capital employed at the end of 2006 represents €26.1 billion, compared with €8.5 billion the previous year before acquiring control of ASF. The Concessions business line now accounts for virtually all of the capital employed, reflecting VINCI’s new financial profile.

Parent company results

Parent company net profit amounted to €1,435 million in 2006, as against €716 million in 2005.

Dividend

The Board of Directors has decided to propose a dividend of €2.65 per share, representing an increase of 33% over the previous year’s dividend, to the Shareholders Meeting.

If approved, given the interim dividend of €0.85 paid in December, the final dividend payable on 14 May will be €1.80 per share.

Cofiroute

The Board of Directors approved the acquisition by VINCI of Eiffage’s 17.1% holding in Cofiroute.

This transaction, which increases VINCI’s holding in Cofiroute to 82.40%, is part of the Group’s strategy to expand in motorway concessions, which offer predictable revenue streams and interesting prospects for growth and synergies.

Composition of the Board of Directors

Noting the resignation of Mr Serge Michel from his role as Director, the Board thanked him for his personal contribution to the Group’s success and decided unanimously to appoint him Honourable Chairman of VINCI.

The Board of Directors also decided to co-opt Mr Jean-Bernard Levy, Chairman of the Management Board of Vivendi, to the VINCI Board.

Outlook for 2007

The substantial infrastructure needs in Europe and the increasing popularity of public-private partnerships as illustrated by the Group’s recent successes in France and Greece, confirm the relevance of the integrated construction and concession business model on which VINCI has based its growth plan.

The order book for construction activities remains at a very high level of almost €18 billion.

Within this favourable context, VINCI has good visibility of its business prospects and profit, which is expected to show further growth in 2007.

The Group is planning to hire 12,000 new employees in France under unlimited term contracts in 2007.

 

Note: VINCI’s published statutory consolidated financial statements at 31 December 2006 consolidate ASF from 10 March 2006, the date on which VINCI acquired control of ASF. Prior to that date, the statutory consolidated financial statements accounted for ASF at 23% using the equity method.

For comparison purposes, pro forma statements have been prepared restating the data presented in 2006 and 2005 based on full consolidation of ASF-Escota for both 2005 and 2006.

Moreover, the airport services operations, which were sold during the second half of 2006, are presented on a separate line in both the statutory and pro forma financial statements, in accordance with IFRS 5 Non-Current Assets Held for Sale and Discontinued Operations .

(1) Pro forma data: full consolidation of ASF-Escota since 1 January in both 2005 and 2006
(2) Dividend proposed to the Shareholders Meeting of 10 May 2007 including the interim dividend of €0.85 per share paid on 21 December 20
(3) Actual data including ASF-Escota from 10 March 2006, the date on which VINCI acquired control

Diary

Analysts’ meeting: it will be held at 08.30 on Wednesday, 28 February at Pavillon Ledoyen, 1 avenue Dutuit, 75008 Paris.
A simultaneous telephone conference is scheduled on the following numbers:
+33 1 72 28 08 31 (in French) and +44 161 601 89 12 (in English).

This press release and the presentation to analysts are available in French and English
on VINCI’s website: www.vinci.com

Shareholders Meeting:
The meeting will be held at 11.00 on 10 May 2007 at the Olympia theatre in Paris

 

(*) pro forma : consolidation of ASF at 100% from 1 January in both 2005 and 2006
(1) after amortisation of goodwill on ASF and ESCOTA contracts
(2) Including the impact of current dilutive instrument
(3) before income taxes and net interest paid
(4) Cash flow from operations - changes in working capital requirement and current provisions - income taxes and net interest paid - net investments in operating assets
(5) 2005 pro forma - after €500 million issue of perpetual subordinated bonds in February 2006 and share capital increase (March-April 2006)

 

(*) ASF accounted for using the equity method in 2005 and until 9 March 2006 on the basis of VINCI's 23% holding; fully consolidated from 10 March 2006
(1) after amortisation of goodwill on ASF and ESCOTA contracts
(2) Including the impact of current dilutive instrument
(3) before income taxes and net interest paid
(4) Cash flow from operations - changes in working capital requirement and current provisions - income taxes and net interest paid - net investments in operating assets
(5) including minority interest

Actual data (statutory accounts) by business line

Operating profit

 

Net profit

 

Curriculum vitae of Mr Jean-Bernard Lévy

Experience
Since April 2005: Chairman of the Management Board of Vivendi
2002 – 2005: Chief Operating Officer of Vivendi Universal
1998 – 2002: General Manager and then Managing Partner of Oddo Pinatton
1995 – 1998: Chairman and Chief Executive Officer of Matra Communication
1993 – 1994: Chief of Staff to Mr Gérard Longuet, French Minister for Industry, Postal Services, Telecommunications and
Foreign Trade
1988 – 1993: General Manager, Communication Satellites, at Matra Espace and then Matra Marconi Space
1986 – 1988: Technical Adviser to Mr Gérard Longuet, French Minister for Postal and Telecommunications Services
1982 – 1986: Assistant to Head of Personnel, France Télécom
1979 – 1982: Transmission Lines Manager in Operations Division of Angers Telecommunications, France Télécom

Education
Ecole Polytechnique (class of 1973)
Ecole Nationale Supérieure des Télécommunications

Mr Jean-Bernard Lévy, 51, is married and has four children

 

About VINCI
VINCI is a global player in concessions, energy and construction, employing 280,000 people in more than 120 countries. We design, finance, build and operate infrastructure and facilities that help improve daily life and mobility for all. Because we believe in all-round performance, we are committed to operating in an environmentally, socially responsible and ethical manner. And because our projects are in the public interest, we consider that reaching out to all our stakeholders and engaging in dialogue with them is essential in the conduct of our business activities. Based on that approach, VINCI’s ambition is to create long-term value for its customers, shareholders, employees, partners and society in general.