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VEOLIA TRANSPORT VEOLIA TRANSPORT VEOLIA TRANSPORT
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CO N T E N T S
An international company specializing in land and sea
transportation, Veolia Transport provides public transportation and
freight solutions drawing from a wide range of expertise and sectors
C O N T E N T S
on four continents.
Veolia Transport has placed its mobility management know-how at
the service of local authorities which have entrusted it with their
Overview of the company
P.
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transit systems as delegated public-utility operations since 1876.
In 25 countries, the company and its 72,302 employees provide
Interview with Stéphane Richard
Sectors
P.
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keeping with clients’ and our passengers’ expectations, and with
P.
09
P.
15
Progress 2005
responsive services whose reliability, comfort and quality are in
respect for economic, social and natural environments.
Europe’s leading private operator in public transportation, Veolia
Quality and sustainable development
P.
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Transport operates 30,757 road vehicles, sea vessels and trains and
carried over 2.5 billion passengers during 2005 over a total distance
of 1.6 billion kilometers. The company generated turnover during
Contracts around the world
P.
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2005 of €4.35 billion, an increase of 21.2% compared with 2004.
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O V E R V I E W O F T H E C O M PA N Y O V E R V I E W O F T H E C O M PA N Y
O V E RV I E W O F
T H E CO M PA N Y
A global company... enjoying sustained
Objective
To establish Veolia Transport as a world
leader and benchmark in the development and management of urban and
regional public transportation services. To develop services for industry,
particularly rail.
NORWAY
SWEDEN
FINLAND
ESTONIA
DENMARK
POLAND
NETHERLANDS
CZECH REPUBLIC
IRELAND
GERMANY
UNITED KINGDOM
SLOVAKIA
Mission
BELGIUM
SLOVENIA
To build and maintain long-term and
profitable partnerships with transit
authorities, passengers, employees
and all others concerned to provide
safe, reliable, quality transport services
that take account of the local context.
CANADA
FRANCE
SWITZERLAND
PORTUGAL
UNITED STATES
SPAIN
LEBANON
ISRAEL
COLUMBIA
Values
Close contact with customers
Enterprising spirit
Individual and collective responsibility
Local autonomy and global integration
Innovation
MAYOTTE
AUSTRALIA
2
O V E R V I E W O F T H E C O M PA N Y O V E R V I E W O F T H E C O M PA N Y
O V E RV I E W O F
T H E CO M PA N Y
development
Turnover
Number of employees
Passengers carried
(on December 31, 2005)
(in billions)
2004
2004
2004
3.6
61,288
2.1
2005
2005
2005
4.35
72,302
2.5
(in billions of Euros)
EUROPE (excluding France) 1,802,641
FRANCE 1,732,106
Geographic
breakdown
of turnover (€ 000s)
North America 403,341
(of which 777 million
by rail)
PACIFIC 398,582
Variation in turnover
2005-2004
Middle East 9,895
South America 8,288
Growth by acquisition: +7.9%
+21.2%
Internal growth: +12.5%
(Exchange rate effect: +0.8 %)
NEW CALEDONIA
Operations in 25 countries
Number of vehicles operated in 2005: 30,757 (+11% on 2004) of which: 16,738 buses, 9,511 coaches, 974 taxis,
3,259 rail vehicles, 55 ships and 220 other vehicles.
A
1.6 billion kilometers covered (+20% compared with 2004)
8,243 km of railway line operated (excluding freight)
26.8% increase in turnover of rail freight, totaling €152 million.
NEW ZEALAND
3
Veolia Transport: a new brand name
to carry us forward
At the same time as the rest
of the divisions of Veolia Environnement, Connex is changing
its name and identification to
become Veolia Transport.
Sharing this brand name will be
an advantage for current and
future development, which will
benefit from the visibility of a
world leader in environmental
solutions, a company that is
considered a benchmark by local authorities and industry and
is renowned for its capacity to
develop and implement solutions tailored to the needs of
public services.
The new brand name also sends
a clear signal to our employees
that they are now fully integrated into the greater entity that
is Veolia Environnement, which
provides them with numerous
opportunities for professional
development.
The brand name and identification will be phased in gradually
in subsidiaries, throughout our
operations and on vehicles over
the course of 2006.
4
Connex becomes Veolia Transport. As of 2006, vehicles
will operate under this new brand name, which will be
used worldwide.
Interview
Interview
Interview
Interview
Interview
Interview
“We have demonstrated that
our development model–public-private
partnerships–performs well everywhere,
both economically and socially.”
Interview with Stéphane Richard,
CEO of Veolia Transport
2005 was an eventful year for Veolia Transport.
How would you assess it?
Stéphane Richard
CEO of Veolia Transport
We have strengthened our position as the benchmark for private operators in all sectors. Veolia
Transport has consolidated its position on four continents in its areas of expertise as a partner to local
authorities and increasingly–as this year has demonstrated–to industry. We developed this aspect
under the name Connex; now we will implement
and reinforce it with greater vigor under the name
Veolia Transport.
Despite a difficult climate, affected by the increase
in fuel prices in particular, we have entered a decisive stage in our development. We have seen
a recovery of profitability and, through organic
growth and acquisitions, have made major progress in terms of our business and international
presence. New areas of growth are opening up
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Interview
for us in the rail and sea sectors. Overall turnover
has risen to €4.35 billion, which is an increase of
21.2%, 12.5% of which was generated by organic
growth and 7.9% through growth by acquisition.
The acquisition of ATC has doubled the size of
Veolia Transport in the United States. Is this zone
your “new frontier”?
The acquisition of ATC reinforces our position
in North America and, having obtained new bus
contracts in Denver (Colorado) and the operation
of the Bus Rapid Transit network in York (Ontario),
places us at the forefront of private operators in
North America. In less than five years, we have
become a benchmark in a market with enormous
potential, only 10% of which is currently open to
competition.
So Veolia Transport is now in a very good position to demonstrate the advantages of public-private partnerships in terms of service quality and
competitiveness as regards such essential transit
modes as bus and rail in the US and elsewhere.
6
Over 40% of Veolia Transport’s total turnover is
generated in Europe (excluding France). Are there
still significant prospects for development there?
Europe is the market in which we have the greatest
experience as it is where our roots lie and where there
are still many challenges to be addressed. The main
one being the promotion of public-private partnerships in countries which, for the most part, are not
very open to competition. We benefit from experience
“Spectacular progress
in North America has
made us the leading
private land passenger
transportation service provider
in the United States.”
gained in German and Scandinavian markets where,
over 10 years, we have demonstrated the relevance
of this method of management. In Germany, for
example, the quality of the service we provide has
made the regional rail lines operated by the private
sector successful, and has convinced more regions to
entrust us with their rail operations and renew our
contracts. In Poland, the economic and social effectiveness of our operation has led public authorities
to speed up the sub-contracting of some bus routes.
In 2005, our activity in Europe was marked by several
major events. We significantly reinforced our positions in Germany by obtaining or starting several
strategic rail contracts, including the Marschbahn,
Nordharz and Berlin-Küstrin lines. The acquisition of
Helgelandske in Scandinavia will boost our maritime
business. We also returned to the United Kingdom
and started operations in three new central European
countries.
We restructured development in this zone with
the creation of a subsidiary, Veolia Transport Central
Europe,35%ofwhichwassold to theEuropeanBankfor
Reconstruction and Development (EBRD) in December. This partnership will contribute to accelerating
the growth of activity in countries where we already
have a presence and will support our expansion in
central and eastern Europe and the Balkans.
Interview
Interview
Interview
Interview
Interview
Interview
Are results in France up to your expectations?
France made a significant contribution to growth
during 2005. All contracts that reached their term
in 2004 and 2005 were renewed, with increased
scope in most cases.
The involvement of Veolia Transport in the plan for
renewal of the SNCM (Société Nationale Maritime
Corse Méditerranée) ferry company has received a
lot of media coverage, but I believe that it is unlikely
to come about until some time in 2006. Aside from
the social issues of which we are very mindful, this
operation, which fits within our scope of activity,
will enable us to reinforce our maritime expertise.
We are positioning ourselves in this operation as
a long-term partner, the main aim of which will
be to get the company back onto a viable financial footing. In addition, a strategic milestone was
reached this year with the awarding of two industrial contacts that will enable us to open the first
private rail freight lines between France and Germany. Now a pioneer in the liberalization of the
French rail market, we are well placed to take part
in the various steps in the opening up of domestic
freight lines planned in France for 2006.
What prospects do you envisage for 2006?
“Strategic phases were initiated
in 2005 in rail freight
and maritime activity.
Excellent development
opportunities are opening up
for Veolia Transport.”
The prospects for 2006 are promising in all geographic areas and sectors of activity. The opening up
to competition of the transportation market guarantees growth for us over the coming years. Everywhere
in the world, and taking advantage of increased demand for mobility, we expect to continue supporting local authorities in the development and management of their public passenger transportation
services. We will step up our maritime operations
in Europe. We also aim to promote our expertise in
bus rapid transit and light rail systems in southern
“In France, all contracts
that reached their term in 2004
and 2005 have been renewed
and, in most cases, their scope
has been expanded.”
Europe and developing countries. In France, Germany
and Holland, we will be expanding our freight
operations with a view to increasing the proportion of
industrial customers in our overall annual turnover.
In addition to these activities, there are favorable
structural factors that give us reason to feel confident about 2006 and subsequent years such as a
greater political awareness of the challenges of sustainable development, the challenge of mobility in
developing countries and the demographic profile of
developing countries.
7
Creating and
providing mobility
solutions worldwide
9
SECTORS SECTORS SECTORS SECTORS SECTORS SECTORS SECTORS
SECTORS
A means of development:
A model for expansion
O
peration of the Marschbahn line:
“a great regional line”
Awarded to the Nord-Ostsee-Bahn (NOB),
the contract for the Marschbahn line
linking Hamburg and Westerland,
is the largest rail contract awarded
to a private company in Germany.
It requires the operator to take
on the full commercial risk and
generates a cumulative turnover
in ten years of €500 million. NOB has
invested €12 million in the launch
of this line and created 100 new jobs.
It has also built a new maintenance
depot, ordered 21 automatic units
for stations on the line and set up
a passenger information system
comprising a website, a call center
and electronic display panels.
This new contract is expected to save
the region €100 million over the next
ten years. The total savings derived
from all tenders issued for rail transit
in Schleswig-Holstein are estimated
at €270 million*.
* Source: Schleswig-Holstein Ministry of Transport
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Public-private partnerships (PPPs) first appeared in the
19th century and are today the most common means
of public transport operation in France where they account for 90% of urban and intercity road transport
operation outside the Paris region. The outsourcing
of public services to companies has increased significantly worldwide in response to the gradual opening
up to competition of European markets, the increasing complexity of urbanization in developing countries and also the excellent performance of this type of
operation. Public-private partnerships enable public
authorities to retain control of public services by trans-
Veolia Transport manages
public passenger transit systems
in
countries
where it serves over 5,000 communities.
25
ferring all or part of the responsibility for operation
and maintenance to private partners.
PPPs therefore have the advantage of serving the interests of local authorities wishing to offer a high-performance public service and those
of the service provider, which,
over the longer term, develops its
expertise and know-how.
The European Union encourages
private sector involvement in its
draft regulation on the obligations of public services. It is also
employed in eastern Europe to
liberalize certain economic sectors and is recommended by the
International Monetary Fund,
the World Bank and the European Bank for Reconstruction and
Development.
Veolia Transport is the Czech Republic’s
leading private operator in public
transportation, with over 100 million
passengers carried every year.