Bouygues; Nine-month 2011 Results

By Bouygues, PRNE
Monday, November 14, 2011

PARIS, November 15, 2011 -

  • Sales: €23.7billion (+3%)
  • Current operating profit: €1,338million (+1%)
  • Good commercial activity and high order book for the Construction businesses
  • Very healthy financial structure

Sales target revised upwards to €32.2billion

 

The operating performance in the first nine months of 2011 was robust, in keeping with the first half of 2011 and in line with the 2011 roadmap.

The Bouygues group reported a 3% increase in consolidated sales (up 1% like-for-like and at constant exchange rates) to €23.7 billion. Current operating profit was up 1% to €1,338 million. Net profit attributable to the Group stood at €794 million. The change in net profit compared with the first nine months of 2010
(-€129 million) was mainly due to the lower contribution from Alstom.

The financial structure is very healthy, with net debt stable vs. end-September 2010 and substantial liquidity.

Key figures


    (EUR million)
                                        9-month 2010 9-month 2011   Change

    Sales                                     23,067       23,719     +3%

    Current operating profit                   1,328        1,338     +1%
    Operating profit                           1,398[1]     1,376[2]  -2%
    Net profit attributable to the
    Group                                        923          794    -14%

    Net debt[3]                                3,770        3,808   +EUR38m
    Net gearing[3]                                37%          36%    -1 pt

[1]Including €70 million of other operating income and expenses, or +€96 million at TF1 and -€26 million at Colas

[2]Including €38 million of other operating income and expenses at Bouygues Telecom

[3]End of period

Business areas

The Construction businesses recorded good commercial activity and improved profitability.

Third-quarter 2011 order intake remained buoyant in an uncertain economic environment. The order book remained at a high level, despite sales growth.

Bouygues Construction posted a 4% increase in sales to €7,086 million (up 3% in France and 6% on international markets). The operating margin stood at 3.8%, reflecting the smooth execution of contracts in progress. Net profit rose 11% to €159 million.

Order intake remained at a high level (€8.3 billion over the first nine months of 2011). An order book of €15.3 billion (up 7% vs. end-September 2010) offers Bouygues Construction good visibility on future activity.

Bouygues Immobilier reported a 12% decline in sales to €1,548 million (down 1% in residential property and down 52% in commercial property). While the commercial property business remained affected by a tough comparison basis, the pick-up in residential property was confirmed with a third-quarter rise in sales of 11%, vs. 2% in the second quarter and -14% in the first quarter of 2011. The operating margin was firm at 8.2% and net profit amounted to €78 million.

After a record 2010, residential property reservations remained at a high level and reached €1,530 million with sharp third-quarter 2011 growth of 12%. Overall reservations grew 8% to €1,868 million in the first nine months of 2011. The order book was up 20% on end-September 2010 to €2.6 billion.

Colas recorded a 4% rise in sales to €9,168 million (up 9% in France and down 1% on international markets). As expected, profitability is improving gradually. Current operating profit came to €274 million (up 17%) and the current operating margin to 3%, up 0.3 points. While operating profit increased 31% to €274 million, net profit advanced 33% to €209 million.

Business activity remained strong in the third quarter. Thanks to a good level of order intake, the order book was up 2% vs. end-September 2010, despite sales growth.

TF1: strategic decisions pay off

In the first nine months of 2011, TF1’s sales came to 1,839 million (up 1%), the contraction in the TF1 TV channel’s advertising revenues being offset by the rise in the sales of the other activities. The current operating margin increased to 10.6% (up 3.8 points vs. the first nine months of 2010). Current operating profit at end-September 2011 rose €70 million to €195 million. Net profit attributable to the Group reached €125 million in the first nine months of 2011, a decrease of €45 million due to an exceptional item of €96 million in third quarter 2010, related to the takeover of TMC.

Bouygues Telecom continues to expand its fixed line activity and is experiencing intense competition in the mobile market. Nine-month 2011 results are in line with expectations

Bouygues Telecom’s sales advanced 3% to €4,285 million and sales from the network were up 2% to €3,831 million. As expected, EBITDA was negatively impacted by the cut in mobile termination rate differentials. It came to €1,035 million (-6%). Operating profit amounted to €550 million and this included €38 million of non-current income relating to an asset disposal. Net profit was down 10% to €353 million.

In a fiercely competitive mobile market, Bouygues Telecom gained 275,000 new mobile plan customers in the first nine months of 2011. At end-September 2011, the total customer base came to 11,217,000, of whom 80.4% were on mobile plans (a yoy increase of 1.5 points). Moreover, thanks to the strong momentum in the year to date, the MVNO[1] customer base stood at 1.3 million at the end of third quarter 2011.

The performances on the broadband market were very good. Bouygues Telecom is leader in terms of net market growth with 311,000 new customers in the first nine months of 2011[2]. The operator’s total fixed broadband customer base stood at 1,119,000 at 30 September 2011.

[1] An estimate of the MVNO active customer base. Customers who have carried out an outgoing operation during the last month.

[2] Encompasses both broadband and very-high-speed subscriptions.

Alstom

Alstom’s contribution to Bouygues’ net profit came to €134 million in the first nine months of 2011 (vs.
€239 million for the first nine months of 2010). In third quarter 2011, it improved €17 million to a total of
€40 million.

Confirming the recovery achieved in the second part of FY2010/11, order intake grew 45% in the first half of FY2011/12 to €10.2 billion. Alstom confirmed its operating margin target of between 7% and 8% for FY2011/12.

Financial situation

Cash flow was up slightly to €2,483 million. The free cash flow figure1 of €886 million was almost stable despite the expected increase in net capital expenditure (€997 million, up €133 million vs. the first nine months of 2010).

Cash flow generation has kept net debt at the same level as in September 2010 (€3.8 billion), before factoring in two major operations in the fourth quarter, namely the 2.6 GHz frequencies bought by Bouygues Telecom (€228 million) and the share repurchase tender offer (€1,250 million).

[1]Before change in the working capital requirement

Significant events since 30 June 2011

  • 18 July 2011: Bouygues Telecom launched its new mobile plan “B&YOU”.

  • 27 July 2011: Bouygues Construction started works on a new development on the site of the former Laennec hospital in Paris for a total of €150 million.

  • 28 July 2011: TF1 acquired the 65.7% stake held by Metro International in Metro France, bringing its total interest in the latter to 100%.

  • 30 September 2011: Bouygues Telecom announced the launch of Eden, its new simplified range of plans.

  • 13 October 2011: Colas won a number of contracts in Canada for an overall amount of €140 million (contract to build a rail intermodal site as well as a number of motorway contracts).

  • 10 October 2011: An Extraordinary General Meeting of shareholders authorised the Board of Directors to carry out a reduction in the share capital through a share repurchase tender offer for a maximum of 41.7 million Bouygues shares (11.7% of the share capital), at a price of €30 per share.

  • 20 October 2011: Colas Rail was awarded metro contracts as part of a consortium in Los Teques, Venezuela (€96 million) and Kelana Jaya, Malaysia (€96 million).

Full-year 2011 sales target

Based on the performances of the first nine months of 2011, the sales target for 2011 has been revised up to €32.2 billion (+3%).

    Sales

    by business area                              2011
                            2010                                         %
    (EUR million)          actual                target                change
                                   Reported          Reported Reported
                                   in March Reported    in       in
                                             in May   August  November

    Bouygues Construction    9,235    9,400  9,600    9,600    9,700    +5%
    Bouygues Immobilier      2,418    2,440  2,440    2,440    2,440    +1%
    Colas                   11,661   11,800 11,800   11,900   12,050   +3%
    TF1                      2,622    2,630  2,630    2,630    2,590    -1%
    Bouygues Telecom         5,636    5,730  5,730    5,730    5,730    +2%
    Holding company and
    other                      132      120    120      120      120      nm

    Intra-Group elimination  (479)     (420)  (420)    (420)    (430)     nm

    TOTAL                   31,225   31,700  31,900   32,000   32,200   +3%
    o/w France             21,576[1] 22,000  22,100   22,400   22,400   +4%
    o/w international       9,649[1]  9,700   9,800    9,600    9,800    +2%

[1]Following the change in status of Mayotte, which has become a French department, sales were reclassified to France.

Financial calendar:

28 February 2012: full-year 2011 results (5.45pm CET)

29 February 2012: full-year 2011 results presentation

The financial statements have been subject to a limited review by the statutory auditors and the corresponding report has been issued.

You will find the full financial statements and notes to the financial statements on www.bouygues.com


www.bouygues.com


    Condensed consolidated
    income statement
                                           9-month
    (EUR million)                                      % change
                                         2010    2011

    Sales                              23,067  23,719       +3%

    Current operating profit            1,328   1,338       +1%

    Other operating income and
    expenses                               70[1]  38[2]      -46%

    Operating profit                    1,398   1,376       -2%

    Cost of net debt                     (251)   (205)     -18%

    Other operating income and
    expenses                               24      (1)       nm

    Income tax expense                   (376)   (395)      +5%

    Share of profits and losses from
    associates                            279     143      -49%

    Net profit                          1,074     918      -15%

    Minority interests                   (151)   (124)     -18%

    Net profit attributable to the
    Group                                 923     794      -14%

[1] Other operating income and expenses include:

- TF1: exceptional income of €96 million generated by the restatement of the previously-held equity interest
following the takeover of TMC

- Colas: non-current items of -€26 million relating to charges for former competition-related matters
and write-downs of goodwill in Central Europe

[2] Non-current income relating to an asset disposal at Bouygues Telecom

    Third-quarter consolidated
    income statement
                                         Third quarter      %
    (EUR million)                                        change
                                         2010    2011

    Sales                               8,412   8,505      +1%

    Current operating profit              617[1]  586      -5%

    Operating profit                      700[2]  624[3]  -11%

    Net profit attributable to the
    Group                                 391     403      +3%

1 The figure reported on 2 December 2010 was €630 million, before the reclassification of other operating
income and expenses at Colas.

2Including €83 million of other operating income and expenses, or +€96 million at TF1 and

-€13 million at Colas

3Including €38 million of non-current income relating to an asset disposal at Bouygues Telecom

                                                                 Change
                                                              like-for-like
    Sales                                                        and at
                                                                constant
    by business area                                            exchange
                                          9-month        %        rates
    (EUR million)           9-month 2010    2011       change

    Bouygues Construction          6,801     7,086       +4%         =
    Bouygues Immobilier            1,769     1,548      -12%       -12%
    Colas                          8,785     9,168       +4%        +3%
    TF1                            1,826     1,839       +1%        -2%
    Bouygues Telecom               4,146     4,285       +3%        +3%
    Holding company and
    other                             99        90        nm        nm

    Intra-Group
    elimination                     (359)     (297)       nm        nm

    TOTAL                         23,067      23,719     +3%        +1%
          o/w France              15,890[1]   16,498     +4%        +2%
      o/w international            7,177[1]    7,221     +1%        -3%

1Following the change in status of Mayotte which has become a French department, sales were reclassified to France

    Contribution of business areas
    to
    EBITDA
                                          9-month         %
    (EUR million)                                      change
                                       2010    2011

    Bouygues Construction                 433     370    -15%
    Bouygues Immobilier                   144     126    -13%
    Colas                                 565     595     +5%
    TF1                                   172     229    +33%
    Bouygues Telecom                    1,100   1,035     -6%
    Holding company and other             (23)    (41)    nm

    TOTAL                               2,391   2,314      -3%
    Contribution of business areas
    to

    Current operating profit
                                          9-month         %
    (EUR million)                                      change
                                       2010    2011

    Bouygues Construction                 237     266     +12%
    Bouygues Immobilier                   150     127     -15%
    Colas                                 235     274     +17%
    TF1                                   125     195     +56%
    Bouygues Telecom                      611     512     -16%
    Holding company and other             (30)    (36)     nm

    TOTAL                               1,328   1,338      +1%
    Contribution of business areas
    to

    Net profit attributable to the
    Group                                                %
                                         9-month      change
    (EUR million)
                                       2010   2011

    Bouygues Construction                143     159     +11%
    Bouygues Immobilier                   77      78      +1%
    Colas                                152     201     +32%
    TF1                                   73      55     -25%
    Bouygues Telecom                     351     316     -10%
    Alstom                               239     134     -44%
    Holding company and other           (112)   (149)     nm

    TOTAL                                923     794     -14%
    Net cash by business area                     Change
                                    9-month
    (EUR million)                                 (EURm)
                                   2010    2011

    Bouygues Construction         2,905   2,393  -EUR512m
    Bouygues Immobilier              93     275  +EUR182m
    Colas                          (666)   (823) -EUR157m
    TF1                              (9)     87   +EUR96m
    Bouygues Telecom               (339)   (440) -EUR101m
    Holding company and other    (5,754) (5,300) +EUR454m

    TOTAL                        (3,770) (3,808)  -EUR38m
    Contribution of business
    areas to

    Cash flow                                            %
                                        9-month        change
    (EUR million)
                                       2010     2011

    Bouygues Construction                375     400     +7%
    Bouygues Immobilier                  145     129    -11%
    Colas                                572     620     +8%
    TF1                                  160     242    +51%
    Bouygues Telecom                   1,073   1,052     -2%
    Holding company and other            103      40     nm

    TOTAL                              2,428   2,483     +2%
    Contribution of business
    areas to

    Net capital expenditure                            Change
                                        9-month
    (EUR million)                                      (EURm)
                                       2010     2011

    Bouygues Construction                145     177   +EUR32m
    Bouygues Immobilier                    3       7    +EUR4m
    Colas                                275     252   -EUR23m
    TF1                                   35      29    -EUR6m
    Bouygues Telecom                     400     536  +EUR136m
    Holding company and other              6      (4)  -EUR10m

    TOTAL                                864     997  +EUR133m

Press contact: +33-(0)1-44-20-12-01 - presse at bouygues.com
Investors and analysts contact: +33-(0)1-44-20-10-79 - investors at bouygues.com

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