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Bureau Veritas Sa — H1 2008 Earnings Presentation

49 slides from Bureau Veritas Sa's earnings presentation, Aug 28, 2008

Slide 1: 2008 Half Year Results
Frank Piedelièvre Chief Executive Officer 2008 Half Year Results François Tardan August 28, 2008 Chief Financial Officer Copyright©2008 Bureau Veritas - All rights reserved.
Slide 4: Bureau Veritas at a Glance
Bureau Veritas at a Glance Broad Geographic Presence ► A global leader in conformity assessment services in the areas of Africa 5% Americas 14% quality, health and safety, environment Asia Pacific & and social responsibility (QHSE) Middle East 25% Revenue of €2.070bn and adjusted operating profit of
Slide 5: Highlights
Highlights ► Strong financial performance in H1 2008 Revenues up 23.7% (12.9% organic growth) to €1.2bn Adjusted operating profit up 28.1% to €180.3m Adjusted attributable net profit up 24.4% to €112.5m Net cash generated from operating activities up 29.2% to €95.5m ► Efficient Mining & Minerals pla
Slide 6: Four key drivers of financial performance
Four key drivers of financial performance 1. Organic Top-Line Growth 2. Contribution from Acquisitions to Top-Line Growth 13% 16% 10% 9% 7% 5% 5% 2% FY 2006 FY 2007 H1 2007 H1 2008 FY 2006 FY 2007 H1 2007 H1 2008 3. Adjusted Operating Margin 4. Net cash generated from operating activities(1) (in € m
Slide 8: Summary income statement
Summary income statement (in € millions) H1 2008 H1 2007 Change Revenue 1,198.9 969.4 +23.7% Adjusted operating profit (1) 180.3 140.7 +28.1% Adjusted operating margin 15.0% 14.5% +50bps Non-recurring or non-operational items (8.1) (9.9) (18.2)% Operating profit 172.2 130.8 +31.7% Net financial expe
Slide 9: H1 2008 Revenue
H1 2008 Revenue +16.1% 1,198.9 (in € millions) (5.3)% +12.9% 969.4 Total growth of 23.7% H1 2007 Organic External Currency H1 2008 Revenue Growth Growth Impact Revenue ► Strong organic growth of 12.9%, with a growth in excess of 20% in Marine, Industry and Consumer Products ► Growth from acquisition
Slide 10: Acquisitions to date
Acquisitions to date 12 Acquisitions – c. €160m of annual revenues Name Date Business Country Revenues (€m) Ziller Ass Jan. 08 Fire safety equipment inspection Germany 2 services Tecniter Jan. 08 Construction code compliance Italy 0.4 Codde Jan. 08 Energy efficiency France 0.4 auditing tools Cesmec
Slide 11: Adjusted operating profit
Adjusted operating profit (in € millions) H1 2008 H1 2007 Change Operating profit 172.2 130.8 +31.7% Amortisation of business combination intangibles and 8.1 4.5 +3.6m goodwill impairment (1) Reorganisation costs (2) - 0.3 (0.3)m Management fees (3) - 1.0 (1.0)m Costs related to the IPO - 4.1 (4.1)m
Slide 12: Net financial expense
Net financial expense (in € millions) H1 2008 H1 2007 Change (€m) Finance costs, net (23.4) (12.9) (10.5) Other financial income (expense) (1.3) (1.3) - Fair value adjustments on current financial 6.6 1.1 5.5 assets Foreign exchange gains (losses) (5.2) (2.2) (3.0) Interest cost on pension plans (2.
Slide 13: Adjusted net profit
Adjusted net profit (in € millions) H1 2008 H1 2007 Change Adjusted operating profit 180.3 140.7 +28.1% Net financial expense (24.7) (14.2) +73.9% Income tax (1) (40.0) (34.0) +17.6% Share of profit of associates 0.1 0.1 Net income from activities held for sale 0.8 - Adjusted net profit 116.5 92.6 +
Slide 14: Summary cash flow statement
Summary cash flow statement (in € millions) H1 2008 H1 2007 Profit before income tax 147.5 116.7 Elimination of cash flows from financing and investing activities 23.2 12.6 Provisions and other non-cash items (3.7) 0.2 Depreciation, amortisation and impairment, net 28.6 19.0 Movements in working cap
Slide 15: Net financial debt
Net financial debt (in € millions) 1,020.0 63.2 322.7 0.9 2.6x Adj. LTM 667.3 EBITDA (€390.2m) 34.1 Net Debt at Dec. Levered free Acquisition spend Dividend Others Net Debt at June 2007 cash flow 2008 Net Net financial financial debt debt should should be be closed closed to to 2x 2x adjusted adjust
Slide 16: Financial position improved
Financial position improved ► July 17, 2008, Issuance of €248m in private placement notes in the United States Lengthening of debt maturity profile and broadening of investor base Four senior notes repayable upon maturity have been issued: • €127.6m at a fixed rate of 6.6% maturing July 2018; and, •
Slide 17: Summary balance sheet
Summary balance sheet (in € millions) Change June 08 Dec. 07 (€m) Goodwill 783.3 569.4 +213.9 Net fixed assets 336.2 242.5 +93.7 Other non current assets (1) 136.2 115.4 +20.8 Working capital requirements 246.1 149.7 +96.4 Total investment 1,501.8 1,077.0 +424.8 Total equity 207.4 165.5 +41.9 Other
Slide 18: Shareholder structure
Shareholder structure ► Market capitalization of €4.2bn at August 26, 2008 ► Free float of 32% (€1.4bn) ► Number of shares outstanding at July 31,2008: 108,328,555 (after cancellation of 8 million treasury shares) ► High proportion of institutional investors (USA, UK, France) Ownership structure (1)
Slide 20: Marine
Marine Revenue (€m) Organic Growth 20.2% +14.2% 138.9 External Growth - 121.6 Currency Impact -6.0% ► Sustained growth in new construction and equipment certification (Asia and Europe). ► Strong order book of GRT 33.5m and 2,829 vessels at June ‘08, compared to GRT 30.2m H1 2007 H1 2008 and 2,398 ve
Slide 21: Marine
Marine ► H1 2008 Highlights In-service fleet Slowdown in world new orders, remaining high at GRT 52.1m GRTm Nb BV new order intake: GRT 6.7m for 828 ships 65 10,000 BV market share increase (China in particular) 60 BV recognized to certify ships under Russian flag 55 ► H2 2008 Outlook & Beyond 8,000
Slide 22: Marine
Marine Order book Yearly New Orders Market Share GRTm Nb ships GRTm 35 3,000 24.50% 25% 30 18.50% 20% 25 2,000 15% 20 12.8% 11.8% 15 10% 1,000 10 5% 5 0 0 0% 04 05 06 07 8 04 05 06 07 8 00 00 20 20 20 20 20 20 20 20 /2 /2 1/ 1/ 1/ 1/ 30 1/ 1/ 1/ 1/ 30 /3 /3 /3 /3 /3 /3 /3 /3 6/ 12 12 12 12 6/ 12 12
Slide 23: Industry
Industry Revenue (€m) Organic Growth 26.5% +59.8% 213.5 External Growth 39.3% 133.5 Currency Impact -6.0% ► Strong growth with sustained contributions coming from CAPEX in oil & gas and power generation in Asia, Middle East, Africa, Russia/Caspian Sea and South America H1 2007 H1 2008 ► Mining and M
Slide 24: Industry
Industry ► H1 2008 Highlights Revenue Breakdown by Market Mining & Minerals platform set-up Continued exploration investments in O&G Others • Large contract wins in Russia 9% (Gazprom), Brazil (Petrobras), India Services Oil & Gas and Middle-East 3% 29% Increased volume of new opportunities in Power
Slide 25: Mineral Platform Set-up Update
Mineral Platform Set-up Update ► Australia Minerals: Amdel Performance in line with acquisition plan Continued strong mining activity in Australia, driven by on-going global demand for iron ore, copper and nickel Facility expansion in Perth for global mineral processing opportunities open since Apri
Slide 26: In-Service Inspection & Verification (IVS)
In-Service Inspection & Verification (IVS) Revenue (€m) Organic Growth 6.4% External Growth 27.1% +30.6% 160.5 122.9 Currency Impact -2.9% ► Organic growth: 3.0% in France 11.9% in Spain and Portugal 2.5% in the UK 5.0% in the Netherlands and Belgium H1 2007 H1 2008 Italy start-up ► Growth from acqu
Slide 27: In-Service Inspection & Verification (IVS)
In-Service Inspection & Verification (IVS) ► H1 2008 Highlights IVS Portable Inspection tool Roll-out of new IT/IS platform in France Regionalisation of UK operations Scope expansion for mandatory periodical inspections in Spain (electrical installations) ► H2 2008 Outlook & Beyond France production
Slide 28: Health, Safety and Environment
Health, Safety and Environment Revenue (€m) Organic Growth 1.1% External Growth 26.1% +20.2% Currency Impact -7.0% 117.7 97.9 ►Organic growth: France +0.9% USA -0.7% UK -3.3% H1 2007 H1 2008 Spain +12.7% ►Acquisitions: Adjusted Operating Profit (€m) / Margin ECA (Spain), Chemtox (Denmark), Anasol (B
Slide 29: Health, Safety and Environment
Health, Safety and Environment Corporate Sustainability Services ► H1 2008 Highlights Under-performing units restructuring • France Training • Spain Occupational Health services • UK HSE Large contract wins in key countries • USA: FEMA(1), Houston Metro • France: GDF, Vinci, Suez • UK: RBS, LFEPA(2)
Slide 30: Construction
Construction Revenue (€m) Organic Growth 9.9% 24.4% External Growth 18.2% 230.6 185.4 Currency Impact -3.7% ► Organic growth France +8.1% Spain +17.3% Japan +52.1% US -12.9% (-7.4% in Q2) H1 2007 H1 2008 ► Acquisitions: ECA (Spain) and Guardian (USA) Adjusted Operating Profit (€m) / Margin 26.1 +28.
Slide 31: Construction
Construction ► H1 2008 Highlights Burj Dubai Tower France: slowdown in new building permits balanced by strong performance in Asset Management Services US: further reduction in new buildings balanced by additional city privatization contracts Reduction in Spanish housing markets Large contract wins
Slide 32: Certification
Certification Revenue (€m) Organic Growth 7.1% External Growth 6.4% +11.5% 131.9 Currency Impact -2.1% 118.3 ► Organic growth in excess of 15% in China, Russia, Chile, Mexico, Columbia and UK. ► Growth from acquisitions of: ECA (Spain) and AQSR (USA) H1 2007 H1 2008 Adjusted Operating Profit (€m) /
Slide 33: Certification
Certification ► H1 2008 Highlights Large global contracts growing faster than New sales breakdown by category mass market. • Key contracts won: Petrobas, Schneider Electric, Nestlé Other 8% Dynamic schemes: ISO 22K, ISO 27001 and Food industry specific schemes – aeronautics, ISO 9k automotive and fo
Slide 34: Consumer Products
Consumer Products Organic Growth 22.7% Revenue (€m) External Growth 0.3% Currency Impact -11.8% +11.2% 134.9 121.3 ► Strong organic growth Increase in analytical testing for restricted substances in all categories of products and especially for toys made in China Increased market share in Germany H1
Slide 35: Consumer Products
Consumer Products ► H1 2008 Highlights Lab network expansion • China, Vietnam, Bangladesh, expansion of analytical capabilities in Asia and Germany Niche acquisitions to reinforce positioning # of product line laboratories in China with EuP directive and Corporate Social Responsibility services 16 1
Slide 36: Government Services & International Trade
Government Services & International Trade Revenue (€m) Organic Growth 6.3% +3.6% External Growth 0.8% 68.5 70.9 Currency Impact -3.5% Government Services (+3.5% organic growth) ► Termination of Ecuador contract offset by dynamism in existing contracts and scope extensions International Trade: (16.9%
Slide 37: Government Services & International Trade
Government Services & International Trade Mobile X-Ray Scanner ► H1 2008 Highlights Termination of Ecuador PSI contract New contract for scanners in Mali and Guinea Scope extension in Bangladesh and Democratic Republic of Congo First contract win for container tracking in Chad ► H2 Outlook and Beyon
Slide 39: Outlook
Outlook ► Strong start for the year ► Another year of strong performance expected in 2008… Due to a strong first half, the group expects higher growth than the previous estimate of 15% growth in revenues and adjusted operating profit, at 2007 exchange rate and excluding any contribution from 2008 ac
Slide 40: Bureau Veritas - Move Forward with Confidence
BUREAU VERITAS Move Forward with Confidence
Slide 42: Income statement
Income statement (in € millions) June 2008 June 2007 Revenue 1,198.9 969.4 Purchase and external charges (348.8) (283.4) Personnel costs (626.1) (504.6) Taxes other than on income (25.7) (23.6) Net (additions to)/reversals of provisions 1.9 (4.3) Depreciation and amortization (28.2) (18.7) Other ope
Slide 43: Balance sheet
Balance sheet (in € millions) June 2008 Dec. 2007 Goodwill 783.3 569.4 Intangible assets 165.5 108.5 Property, plant and equipment 170.7 134.0 Other non-current assets 103.4 87.0 Total non-current assets 1,222.9 898.9 Trade and other receivables 787.9 686.8 Other current assets 74.0 80.6 Cash and ca
Slide 44: Statement of changes in equity
Statement of changes in equity Currency Attributable to Attributable Share Share Other Total (in € millions) translation shareholders to minority capital premium reserves equity reserves of the Company interests January 1, 2008 13.9 409.7 (29.3) (228.8) 165.5 155.6 9.9 Exercise of stock options 1.2
Slide 45: Cash flow statement
Cash flow statement (in € millions) June 2008 June 2007 Profit before income tax 147.5 116.7 Elimination of cash flows from financing and investing activities 23.2 12.6 Provisions and other non-cash items (3.7) 0.2 Depreciation, amortisation and impairment, net 28.6 19.0 Movements in working capital
Slide 46: Detail of net financial debt calculation
Detail of net financial debt calculation (in € millions) June 2008 Dec. 2007 Bank borrowings (non-current) 801.5 735.2 Bank borrowings (current) 320.5 66.2 Bank overdrafts 21.0 8.8 Gross financial debt 1,143.0 810.2 Total cash and cash equivalents 123.0 142.9 Net financial debt 1,120.0 667.3 August
Slide 47: Currency exposure
Currency exposure Revenue Currency Split Key Sensitivities(1) Other 18% Group Group 1% Euro Revenue Operating Profit Change vs. AUD 5% Impact Impact Euro 48% USD 0.13% 0.13% HKD 7% HKD 0.07% 0.14% GBP 5% GBP 0.05% 0.01% USD 13% JPY 2% CNY 2% Moderate Moderate impact impact on on adjusted adjusted op
Slide 48: Earnings Per Share (EPS)
Earnings Per Share (EPS) (in € millions) H1 2008 H1 2007 Change Basic EPS (1) 0.99 0.80 +23.8% Diluted EPS 0.97 0.79 +22.8% Basic adjusted EPS 1.05 0.88 +19.3% Diluted adjusted EPS 1.03 0.86 +19.8% (1) Calculated on weighted average number of shares of 107,380 thousands in June 2008 vs 103,170 thous
Slide 49: Disclaimer
Disclaimer This presentation contains forward-looking statements which are based on current plans and forecasts of Bureau Veritas’ management. Such forward-looking statements are by their nature subject to a number of important risk and uncertainty factors such as those described in the documents fi

Bureau Veritas — H1 2008 Earnings Presentation on 6ix

Bureau Veritas Sa — H1 2008 Earnings Presentation

Slide 1: 2008 Half Year Results

Slide 2: Agenda

Slide 3: Highlights

Slide 4: Bureau Veritas at a Glance

Slide 5: Highlights

Slide 6: Four key drivers of financial performance

Slide 7: Financial review

Slide 8: Summary income statement

Slide 9: H1 2008 Revenue

Slide 10: Acquisitions to date

Slide 11: Adjusted operating profit

Slide 12: Net financial expense

Slide 13: Adjusted net profit

Slide 14: Summary cash flow statement

Slide 15: Net financial debt

Slide 16: Financial position improved

Slide 17: Summary balance sheet

Slide 18: Shareholder structure

Slide 19: Business Review

Slide 20: Marine

Slide 21: Marine

Slide 22: Marine

Slide 23: Industry

Slide 24: Industry

Slide 25: Mineral Platform Set-up Update

Slide 26: In-Service Inspection & Verification (IVS)

Slide 27: In-Service Inspection & Verification (IVS)

Slide 28: Health, Safety and Environment

Slide 29: Health, Safety and Environment

Slide 30: Construction

Slide 31: Construction

Slide 32: Certification

Slide 33: Certification

Slide 34: Consumer Products

Slide 35: Consumer Products

Slide 36: Government Services & International Trade

Slide 37: Government Services & International Trade

Slide 38: Outlook

Slide 39: Outlook

Slide 40: Bureau Veritas - Move Forward with Confidence

Slide 41: Appendix

Slide 42: Income statement

Slide 43: Balance sheet

Slide 44: Statement of changes in equity

Slide 45: Cash flow statement

Slide 46: Detail of net financial debt calculation

Slide 47: Currency exposure

Slide 48: Earnings Per Share (EPS)

Slide 49: Disclaimer