Group

SUEZ reports its 2017 financial estimates and 2018 outlook

ESTIMATED PERFORMANCE FOR 20171 IN LINE WITH GROUP GUIDANCE ON ORGANIC REVENUE GROWTH, FREE CASH FLOW AND LEVERAGE

ORGANIC EBIT GROWTH IMPACTED IN THE FOURTH QUARTER BY ADDITIONAL SPECIFIC EXPENSES, LEADING TO A C.2% DECLINE IN 2017. EXCLUDING THESE ITEMS, THE TREND OBSERVED WAS IN LINE WITH THAT OF THE FIRST NINE MONTHS OF THE YEAR AT +1.4%

IN 2018, ORGANIC EBIT GROWTH EXPECTED TO ACCELERATE TO ABOUT 3%, BOOSTED BY GROWTH FROM WATER TECHNOLOGIES & SOLUTIONS. OVERALL, EBIT GROWTH WILL BE C.10% AT CONSTANT EXCHANGE RATES2


The Board of Directors of SUEZ met today to review estimated results for 2017 and the outlook for 2018. It concluded that SUEZ should meet its 2017 guidance for organic revenue growth, free cash flow generation and leverage. However, EBIT was impacted in the fourth-quarter by €45 million of specific expenses. They were caused mainly by the particular circumstances in Spain, and costs associated with the decision to terminate two services contracts, in Morocco and India, due to operational difficulties. This indicator therefore declined by 2% on an organic basis.
Excluding these items, annual organic growth in EBIT would have been in line with the 1.4% trend reported at the earnings presentation at end-September 2017.
To summarize, SUEZ’s estimates for fiscal year 2017 are currently as follows:
  • Revenue of c.€15.8 billion, an organic increase of c.+1.5%;
  • EBITDA of c.€2,640 million, an organic decrease of c.2.0%;
  • EBIT of c.€1,280 million, an organic decrease of c.2.0%;
  • Net income Group share of c. €300 million. This includes, as previously stated, €45 million in costs related to the GE Water acquisition and €72 million in costs for the voluntary departure plan in France. The other restructuring costs are offset by capital gains;
  • Free cash flow of more than €1 billion; Net financial debt of c.€8.5 billion, for leverage of 3.2x;
  • 2017 dividend of €0.65 per share3.
Given the additional contribution from new “industrial water” business activities, the strong momentum expected in the Recycling & Recovery Europe and International divisions, and the measures taken to adapt to a lackluster environment in Water Europe, the Board of Directors presents the following outlook for 2018:
  • Total growth in revenue at constant exchange rates of c.9%, based on an approximately $2.8 billion contribution from the Water Technologies & Solutions division and more than 1% organic growth at the three other divisions;
  • Total increase in EBIT of 10% based on an approximately $200 million contribution from the Water Technologies & Solutions division and 3% organic growth at the three other divisions4;
  • Free cash flow of about €1 billion5;
  • Net financial debt/EBITDA ratio of close to 3.0x;
  • The pursuit of an attractive dividend policy: ≥ €0.65 per share in respect of 2018 results6.
1 All fiscal year 2017 figures in this press release are non-audited estimated financial data; final 2017 results will be reported on March 1, 2018
2 Excluding the impact of the change in US tax law on regulated water activities, resulting in the transfer of €25 million in income from EBIT to taxable income, which is neutral to net income Group share
3 Subject to approval by the 2018 Annual General Meeting
4 Excluding the impact of the GE Water purchase price allocation, which will be determined in 2018
5 Excluding payments associated with the voluntary departure plan in France and recognized in 2017 and excluding the GE Water integration costs
6 Subject to approval by the 2019 Annual General Meeting

Press contact

Isabelle Herrier Naufle
isabelle.herrier.naufle@suez.com +33 1 58 81 55 62

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