Spie

2012/04/12

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2011 results - Strong growth in 2011 - New shareholders - new goals

Cergy, 12 April 2012 - SPIE recorded strong growth in 2011 in all its markets, in a year marked by the launch of a second LBO supported by new investors. The Group both stepped up its pace of acquisitions and resumed organic growth in 2011.

2011 pro-forma production: €4.047 billion (+9.4%)

EBIT: €218.2 million (+11.2%)

Acquisitions: 14 companies acquired

New shareholders:

- three of the major global private equity funds
- More than 50 % employee shareholders

Successful €375 million bond issue

SPIE’s pro-forma consolidated production of €4.047 billion, up 9.4% year-on-year, reflects its sustained organic growth, especially in France, and its continued external growth, with acquired production from acquired entities about 60% higher than in 2010. The business in Europe was stimulated by the resumption of industrial investment, the development of services to energy and communications companies, and buoyant healthcare and housing sectors. In the international oil and gas market, the vitality of the African market offset the contraction in those markets related to geopolitical upheaval in the Middle East.

EBIT climbed 11.2% year-on-year to €218.2 million, a performance that puts SPIE among the best in its profession. This is the seventh consecutive year-on-year increase and it reflects the Group’s strong market positioning and its disciplined approach to business.

SPIE’s free cash flow after acquisitions far exceeded its target. Its debt-to-equity ratio has decreased from 5 to 4.5 since the launch of the new LBO in August 2011.

In 2011, SPIE made strong progress in the various segments of the green economy. Energy efficiency is becoming a priority for customers, and new low-carbon energies are being constantly developed. For example, SPIE won France’s first social housing energy performance contract in Alsace; it is a member of a consortium commissioned to build one of the largest wind farms in the Netherlands, and it is also working alongside EDF on the Toul-Rosières power station near Metz – Europe’s largest solar photovoltaic plant. The Group is constantly strengthening its positions in other sectors such as energy networks and sustainable mobility: it is involved, for example, in a number of public lighting PPPs and France’s first infrastructure installation contracts for recharging electric vehicles. In low-carbon energies, two acquisitions complemented strong organic growth in SPIE’s nuclear operating segment.

Well positioned for 2012

Despite instability in Europe, SPIE is confident about its prospects for 2012. The Group is benefiting from the increased demand for technical services in long-term growth markets. The outlook is also very healthy in the nuclear sector, in both France (post-Fukushima changes and extending the life of power plants) and the United Kingdom.

SPIE will pursue its profitable growth strategy and develop a balanced mix of activities at its subsidiaries in the Northern Europe. Further ahead, the Group’s major objective will be to acquire new platforms in Northern Europe. This ambition is in line with SPIE’s acquisition strategy and with SPIE’s new financial resources and, within the framework of the second LBO, is supported by its shareholders.

"Despite the prevailing uncertainties, we are confident for 2012. Our growth model, founded on a balanced portfolio of activities, closeness to our customers and the Group’s engagement in the green economy, is enabling us to withstand the economic crisis and register growth in excess of that of GDP. We are already starting to focus our efforts on 2013." commented Gauthier Louette, SPIE’s chairman and chief executive officer.

Second LBO: new growth momentum

After the success of the first LBO, during which SPIE bought around 50 companies and doubled its operating profit, the second LBO marks a new phase of ambitious growth The takeover of SPIE, which was completed on 30 August 2011, brings together three major shareholders: the Clayton Dubilier & Rice investment fund and its partners, AXA Private Equity and Caisse de dépôt et de placement du Québec. This deal significantly increases the Group’s room for growth, in particular in terms of financing acquisitions in Europe.

This new LBO has the following features:

• Strong participation by SPIE’s employees in the company investment fund (Fonds Commun de Placement d’Entreprise - FCPE): more than 50% of employee shareholders.
• Balanced financial structure, with an equity-to-debt ratio of 1 to 2 at 31 December 2011.
• An additional debt capacity of €300 million that can be mobilised to finance acquisitions, on top of the annual semi-organic growth financed by the cash flow from SPIE’s activities.

Valued at €2.1 billion, this acquisition constitutes the largest LBO in France since 2008. In terms of employee share ownership, we believe it is the biggest company investment scheme in unlisted shares in recent years in terms of both the number of subscribers and the amount invested.

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