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Bureau Veritas SA

Earnings Release Aug 26, 2010

1169_iss_2010-08-26_eca044f6-fc36-4058-a0fc-ce685803991f.pdf

Earnings Release

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PRESS RELEASE

Neuilly-sur-Seine, France, August 26, 2010 – The Board of Directors of Bureau Veritas met on August 25, 2010 and has closed the Group's H1 2010 accounts.

  • H1 2010 revenue: €1.3 billion, + 1.5%
  • Q2 organic growth restored to 2.5%
  • Adjusted operating margin up 60 basis points to 16.7%
  • Growth of 9% in attributable adjusted net profit to €149.5 million
  • Organic growth set to gain momentum in H2

Frank Piedelièvre, Chairman and CEO of Bureau Veritas, stated:

"In the second quarter of 2010, Bureau Veritas restored organic growth and also managed to improve margins. The highlight of the first half year was clearly the acquisition of Inspectorate which has enabled us to become a key player in the buoyant commodities testing and inspection market.

In the second half, revenue growth should total around 10%, thanks to faster momentum in organic growth and the consolidation of Inspectorate. Over the full-year 2010, we are forecasting a slight growth in operating margin on an organic basis."

Main consolidated financial items on June 30, 2010

(in millions of euros) H1 2010 H1 2009 Change
Revenue 1,349.1 1,329.5 +1.5%
Adjusted operating profit (a) 225.6 214.5 +5.2%
As a % of revenue 16.7% 16.1% +60 basis points
Operating profit 213.7 205.4 +4.0%
Net financial expense (15.2) (28.2) (46.1)%
Income tax (54.4) (44.7) +21.7%
Attributable net profit 140.8 130.5 +7.9%
Attributable adjusted net profit (a) 149.5 137.3 +8.9%
Adjusted net financial debt on June 30 (b) 712.8 881.3 (168.5)

(a) Before amortization of intangibles and non-recurring items

(b) Net financial debt after currency hedging instruments as defined for the Group's covenants calculation

Highlights of H1 2010

In 2010, the Group resumed its acquisitions policy by acquiring three companies representing cumulated annual revenue of more than €300 million.

On June 1, 2010, Bureau Veritas announced the acquisition of Advanced Coal Technology – (2009 revenue of SAR78 million), one of the leading suppliers of coal testing services in South Africa and offering development potential in other southern African countries (Mozambique, Botswana, Zimbabwe).

On June 22, 2010, Bureau Veritas announced the signing of an agreement to acquire Inspectorate (2009 revenue of GBP246 million) and thereby took a decisive step in its development by becoming one of the global leaders in commodities testing and inspection. This acquisition provides the Group a new dimension by doubling the size of its laboratories network (330 sites) and enabling it to offer the widest range of services in the inspection and certification sector via eight lines of global services: Industry, Construction, Marine, Consumer Products, Commodities, Systems Certification, In-Service Inspection & Verification and Government Services. After the consolidation of Inspectorate, the Group will have more than 47,000 employees spread throughout 140 countries and generate revenue of more than €3 billion.

The Group also acquired US company SMSI, specialised in elevators inspection, with revenue of around €0.2 million.

Q2 2010 revenue growth restored to 5.7%

Q2 2010 revenue rose by 5.7% to €720.2 million and broke down as follows:

  • Organic growth of 2.5%. Having reached a low point at the end of 2009, all businesses reported positive organic growth, with the exception of the Marine and Construction businesses.
  • A negative impact of 2.0% due to disposals of non-strategic activities.
  • A positive impact from exchange rates of 5.2% prompted by favourable changes in the majority of currencies relative to the euro.

H1 2010 revenue rose by 1.5% vs. H1 2009 to €1,349.1 million and broke down as follows:

  • Stable organic growth.
  • A 0.2% negative impact on growth from non-strategic activities prior to their disposal (undertaken in Q1 2010).
  • A 1.4% negative impact from changes in the scope of consolidation due to the disposal of nonstrategic activities.
  • A positive impact from exchange rates of 3.1%, prompted by favourable trends in the majority of currencies relative to the euro.

Change in revenue by business:

(in millions of euros) 2010 2009(a) Overall
growth
Organic
growth
Marine 79.7 84.7 (5.9)% (11.0)%
Industry 188.5 157.1 +20.0% +10.1%
In-Service Inspection & Verification (IVS) 107.4 108.1 (0.6)% +1.7%
Construction 110.0 117.2 (6.1)% (2.3)%
Certification 83.3 75.5 +10.3% +5.7%
Consumer Products 105.3 97.9 +7.6% +2.1%
Government Services & International Trade (GSIT) 46.0 40.8 +12.7% +12.2%
TOTAL Q2 720.2 681.3 +5.7% +2.5%
(in millions of euros) 2010 2009(a) Overall
growth
Organic
growth
Marine 156.0 165.0 (5.5)% (8.3)%
Industry 349.2 304.3 +14.8% +6.3%
In-Service Inspection & Verification (IVS) 209.1 215.4 (2.9)% (0.6)%
Construction 209.6 234.7 (10.7)% (6.3)%
Certification 157.1 143.0 +9.9% +6.8%
Consumer Products 182.7 188.2 (2.9)% (4.3)%
Government Services & International Trade (GSIT) 85.4 78.9 +8.2% +10.0%
TOTAL H1 1,349.1 1,329.5 +1.5% 0%

(a) Since January 1, 2010, the Health, Safety & Environment (HSE) activities have been reclassified under the IVS, Industry and Construction businesses. 2009 data has been adjusted according to this new organisation in order to facilitate comparison.

60 basis points improvement in adjusted operating margin

Adjusted operating profit rose by 5.2% to €225.6 million in H1 2010 vs. €214.5 million in H1 2009.

Adjusted operating margin, expressed as a percentage of revenue, widened by 60 basis points to 16.7% in H1 2010, compared with 16.1% in H1 2009. This growth reflected the improvement in operating processes, primarily in the In-Service Inspection & Verification, Certification and Government Services & International Trade businesses and the ability to adapt the organisation to offset the decline in revenue in the Construction and Marine businesses.

The improvement in operating margin was also enabled by the reform of business tax in France. The value added component (CVAE) of the new business tax applicable in France has been recognized in income tax expense since January 1, 2010. Up to December 31, 2009, it was included in operating items within "Taxes other than on income". This reclassification generated an improvement of €4.7 million in operating profit, equivalent to 35 basis points of operating margin.

Change in adjusted operating profit by business:

(in millions of euros) Adjusted operating profit Adjusted operating margin
2010 2009(a) Chg. 2010 2009(a) Chg.
(bps)
Marine 48.2 54.0 (10.7)% 30.9% 32.7% (180)
Industry 37.4 33.8 +10.7% 10.7% 11.1% (40)
IVS 22.6 16.2 +39.5% 10.8% 7.5% +330
Construction 20.7 19.2 +7.8% 9.9% 8.2% +170
Certification 30.9 25.2 +22.6% 19.7% 17.6% +210
Consumer Products 49.8 53.2 (6.4)% 27.3% 28.3% (100)
GSIT 16.0 12.9 +24.0% 18.7% 16.3% +240
TOTAL H1 225.6 214.5 +5.2% 16.7% 16.1% +60

(b) Since January 1, 2010, the Health, Safety & Environment (HSE) activities have been reclassified mainly under the IVS, Industry and Construction businesses. 2009 data has been adjusted according to this new organisation in order to facilitate comparison.

9% increase in attributable adjusted net profit

Other operating expense totalled €11.9 million compared with €9.1 million in H1 2009, and included:

  • €10.7 million in amortization of intangible assets resulting from business combinations versus €9.1 million in H1 2009.
  • €1.3 million in disposal gains on non-strategic activities.
  • €2.5 million in costs related to the acquisition of Inspectorate.

After taking account of other operating expense, operating profit rose by 4.0% to €213.7 million vs. H1 2009.

Net financial expense totalled €15.2 million in H1 2010, significantly lower than the €28.2 million in H1 2009, and included:

  • Net finance costs of €18.1 million vs. €23.9 million in H1 2009. The decline stemmed from a lower average level of net financial debt as well as lower interest rates.
  • Foreign exchange gains of €9.6 million compared with losses of €2.2 million in H1 2009, primarily on the back of the plunge in the euro relative to the majority of other currencies, and especially the US dollar.
  • Other net financial expenses of €6.7 million, compared with €2.1 million in H1 2009.

Corporate tax totalled €54.4 million on June 30, 2010 vs. €44.7 million on June 30, 2009. The increase in the effective tax rate from 25.2% on June 30, 2009 to 27.4% on June 30, 2010 was primarily due to the value added component (CVAE) of the new business tax applicable in France recognized in income tax expense since January 1, 2010. Adjusted for this reclassification, the Group's effective tax rate would have totalled 25.6% on June 30, 2010, similar to the level booked on June 30, 2009.

H1 2010 attributable net profit rose by 7.9% to €140.8 million. Earnings per share totalled €1.30 in H1 2010 vs. €1.21 in H1 2009.

Attributable net profit adjusted for other operating expenses net of tax rose by 8.9% vs. June 30, 2009 to €149.5 million. Adjusted earnings per share totalled €1.38 in H1 2010 vs. €1.27 in H1 2009.

Cash flow and working capital requirements

Cash flow generated from operating activities totalled €118.1 million in H1 2010 compared with the exceptionally high amount of €194.1 million in H1 2009. Indeed, H1 2009 cash flows more than doubled relative to the H1 2008 level of €86.8 million.

In 2010, seasonal trends in cash flow should be similar to those noted in previous years (excluding 2009) with H1 generally accounting for 30% of full-year cash flow. Note that seasonal factors primarily stem from higher working capital requirements in H1 given that three categories of spending are entirely focused in the first months of the year, namely insurance premiums, employee bonuses and profit-sharing premiums as well as the balance of income tax due for the previous year.

On June 30, 2010, working capital requirements totalled €241.9 million, representing 9.1% of revenue over the previous 12 months and compared with €236.9 million on June 30, 2009 (8.8% of revenue).

The overall amount of capital expenditure (capex) undertaken by the Group in H1 2010 totalled €28.1 million, slightly ahead of the €27.8 million reported in H1 2009. The Group's capex to revenue ratio remained stable at 2.1% of revenue in H1 2010.

Levered free cash flow (cash flow after income tax, interest expenses and capex) totalled €73.4 million in H1 2010 compared with €143.2 million in H1 2009.

Adjusted net financial debt (net financial debt after currency hedging instruments as defined in the calculation of banking covenants) totalled €712.8 million on June 30, 2010 vs. €693.0 million on December 31, 2009. This €19.8 million increase was the result of:

  • €73.4 million in levered free cash flow generated in H1.
  • €84.6 million in dividends paid out.
  • €16.7 million in acquisitions.
  • Other elements reducing debt for €8.1 million.

Outlook

In view of the gradual acceleration in organic growth and the consolidation of Inspectorate over four months, H2 2010 revenue growth should total around 10%. Over the full-year 2010, the Group is targeting a slight growth in adjusted operating margin (as a percentage of revenues) on an organic basis. Inspectorate's financial performance in H1 allows us to confirm its full-year target of £280 million in revenues and £30 million in operating profit. Group net debt at December 31, 2010 should represent less than 2x EBITDA, thereby leaving the Group sufficient financial capacity to pursue an active policy to make small and medium-sized acquisitions.

Further out, structural growth factors in the sector remain the same, namely the multiplication and the bolstering of QHSE regulations, the privatisation and outsourcing of inspection and control activities and the globalisation of trade. The Group's strategy is to invest in market segments offering the highest potential growth such as commodities testing, nuclear, offshore energy and energy efficiency of buildings while remaining the reference for consolidation of the market and maintaining a high-level operating performance.

Results by business

Marine

(in millions of euros) H1 2010 H1 2009 Change
Revenue 156.0 165.0 (5.5)%
Adjusted operating profit 48.2 54.0 (10.7)%
Adjusted operating margin 30.9% 32.7% (180)bps*

* bps: basis points

Revenue in the Marine business fell by 5.5% from €165.0 million in H1 2009 to €156.0 million in H1 2010, due to:

  • An 8.3% organic (same-structure and same currency) decline in revenue.
  • A 2.8% increase in revenue prompted by favourable exchange rates notably for the Korean Won.

New construction (54% of H1 2010 revenue in the Marine business)

Revenue from the new construction activity fell by 15% on same-structure and exchange-rate basis.

The Marine business took 335 orders for new ship construction during H1 2010; representing 3.8 million gross tons (GRT), up 46% relative to H1 2009.

The order book for new construction only incurred a low number of cancellations and totalled GRT 29.5 million on June 30, 2010 compared with GRT 31,0 million on December 31, 2009.

The decline in revenue ought to slow during H2 2010 and the rise in new orders seen during H1 2010 improves visibility for 2011.

Ships in service (46% of H1 2010 revenue in the Marine business)

Revenue in the ships in service activity rose by 1% on a same-structure and exchange rate basis.

On June 30, 2010, the fleet classed by Bureau Veritas totalled 9,217 ships, up 6% relative to H1 2009 and representing GRT 72.1 million (+10.2%).

Lower growth in revenue generated by the ships in service inspection activity in H1 2010 was due to the younger age of the fleet classed by Bureau Veritas since new ships do not require inspection for around 18 months after their delivery, as well as delays in periodical inspections by certain ship owners. This lag should be gradually reabsorbed over the next 12 months.

Adjusted operating margin in the Marine business remained at a high level of 30.9% vs. 32.7% in H1 2009, reflecting the flexible organisation of the business.

Industry

(in millions of euros) H1 2010 H1 2009 Change
Revenue 349.2 304.3 +14.8%
Adjusted operating profit 37.4 33.8 +10.7%
Adjusted operating margin 10.7% 11.1% (40)bps

Revenue in the Industry business totalled €349.2 million in H1 2010 vs. €304.3 million in H1 2009, with the 14.8% increase driven by:

  • An organic growth of 6.3%.
  • A 9.6% increase in revenue prompted by favourable exchange rates, notably the Australian dollar and the Brazilian real.
  • A 1.1% negative impact caused by the disposal of non-strategic activities.

Higher organic growth of 10.1% in Q2 2010 compared with 2.6% in Q1, stemmed from:

  • Oil & gas and power investments in fast-growing geographies (Asia, Latin America, Middle-East and Africa).
  • The development of asset integrity management services for ageing industrial assets in mature countries.
  • The 15% rally in minerals testing revenue prompted by the recovery in production and exploration investments, notably in Australia.

Adjusted operating profit in the Industry business rose by 10.7% from €33.8 million in H1 2009 to €37.4 million in H1 2010. The slight decline in adjusted operating margin from 11.1% in H1 2009 to 10.7% was due to the Mining & Minerals activity, where margins narrowed in H1.

For H2 2010, the Industry business is set to benefit from robust organic growth generated by:

  • Further investments in oil exploration/production, particularly offshore.
  • The ongoing expansion in minerals testing.

In-Service Inspection and Verification (IVS)

(in millions of euros) H1 2010 H1 2009 Change
Revenue 209.1 215.4 (2.9)%
Adjusted operating profit 22.6 16.2 +39.5%
Adjusted operating margin 10.8% 7.5% +330bps

Revenue in the In-Service Inspection & Verification business fell by 2.9% from €215.4 million in H1 2009 to €209.1 million due to:

  • A virtually stable organic performance (-0.6%).
  • A 0.6% negative impact on growth caused by non-strategic activities prior to their disposal during Q1 2010.
  • A 2.2% negative impact from the disposal of non-strategic activities.
  • A 0.5% positive impact from exchange rates.

Organic growth in the IVS business improved to 1.7% in the second quarter of 2010 (Q2 2010) after the 2.8% decrease witnessed in Q1, which suffered particularly from calendar effects and disadvantageous weather conditions.

Performances were mixed depending on the region:

  • Revenue in France was robust during H1 2010 notably thanks to new regulations for heating, ventilation and air-conditioning equipment while revenue in the US grew sharply on the back of the rising momentum of a contract with the USPS postal services.
  • Revenue in Spain was dented by delays in renewals and start-up for a number of major contracts, while that in the UK suffered from the halt to the portable electrical appliances inspection activity which

was highly competitive and loss-making. The Group decided to halt the activity and made this effective in Q4 2009.

Adjusted operating profit in the In-Service Inspection & Verification business rose by 39.5% from €16.2 million in H1 2009 to €22.6 million in H1 2010 prompted by the 330 basis-point widening in adjusted operating margin to 10.8%. This performance stemmed from the completion of re-engineering of processes and the roll-out of automated production tools in France, as well as the recognition of the value added component (CVAE) of the new business tax applicable in France in income tax expense since January 1, 2010 whereas up to December 31, 2009, it was included in operating items..

In the future, the IVS business should continue to benefit from the extended scope of mandatory periodical inspections in Europe as well as expansion in new regions (Eastern Europe, Germany, Italy and the US), further re-engineering of methods and the overhaul of production tools in all countries.

In H2 2010, the Group is forecasting an improvement in activity in Spain and the end to the negative impact caused by the halt to electrical appliance inspection in the UK beyond the third quarter of 2010 (Q3 2010).

Construction

(in millions of euros) H1 2010 H1 2009 Change
Revenue 209.6 234.7 (10.7)%
Adjusted operating profit 20.7 19.2 +7.8%
Adjusted operating margin 9.9% 8.2% +170bps

Revenue in the Construction business fell by 10.7% from €234.7 million to €209.6 million due to:

  • A 6.3% organic decline in revenue.
  • A 0.6% increase in revenue prompted by favourable exchange rates.
  • A 5.0% negative impact caused by changes in the scope of consolidation in 2010 relative to 2009 (disposal of construction material testing activity).

The organic performance improved gradually in Q2, with a decline of 2.3% vs. -10.3% in Q1 2010 prompted by the combination of:

  • An improvement in France with the announcement of tougher criteria for eligibility to the Scellier tax incentive law as of January 1, 2011, having boosted applications for building permits and housing starts before the end of 2010. Furthermore, business registration indicators have increased in recent months.
  • No recovery in building permits and housing starts in the municipalities where the Group is present in the US.
  • The decline noted in state-financed infrastructure projects in Spain.
  • A recovery in Japan.

Adjusted operating profit in the Construction business rose by 7.8% thanks to the recovery in adjusted operating margin from 8.2% in H1 2009 to 9.9% in H1 2010. The margin widened considerably in Japan from 7% in H1 2009 to 13% in H1 2010 and also increased in France with the recognition of the value added component (CVAE) of the new business tax applicable in France in income tax expense since January 1, 2010 whereas up to December 31, 2009, it was included in operating items.

The Group confirmed that the lower volume of operations ought to gradually be reabsorbed by the end of 2010 despite a slower infrastructure market due to lower state spending in Europe.

Certification

(in millions of euros) H1 2010 H1 2009 Change
Revenue 157.1 143.0 +9.9%
Adjusted operating profit 30.9 25.2 +22.6%
Adjusted operating margin 19.7% 17.6% +210bps

Revenue in the Certification business rose by 9.9% from €143.0 million in H1 2009 to €157.1 million in H1 2010, driven by:

  • Organic growth of 6.8%.
  • A 3.1% increase in revenue prompted by favourable exchange rates.

During H1 2010, the Certification business reported robust organic growth thanks to:

  • The rising momentum of sustainable development schemes including management systems for energy performance, bio fuels, greenhouse gases, carbon footprint, food safety and forest management.
  • The development of global clients aiming to place all of their certifications into the hands of a single body offering them global presence, an integrated stance for the various schemes and methodologies adapted to their business sectors and internal processes.
  • Double-digit growth in emerging regions: China, Africa, Middle-East, India, Russia.

Adjusted operating profit in the Certification business rose by 22.6% from €25.2 million in H1 2009 to €30.9 million in H1 2010 on the back of 9.9% growth in revenue and an improvement in productivity prompted by the gradual roll-out of the new integrated production IT system. Operating margin therefore totalled 19.7% in H1 2010 compared with 17.6% in H1 2009.

2010 should continue to benefit from the roll-out of new certification schemes, customized audit solutions for major clients and development in fast-growing economies. In France, the GSAC (Group for Civil Aviation Safety) contract concerning control and verification of civil aviation safety may not be renewed with the Group. The contract is worth €18 million in revenue over the full year and could be ended in Q4 2010.

Consumer Products

(in millions of euros) H1 2010 H1 2009 Change
Revenue 182.7 188.2 (2.9)%
Adjusted operating profit 49.8 53.2 (6.4)%
Adjusted operating margin 27.3% 28.3% (100)bps

Revenue in the Consumer Products business fell by 2.9% from €188.2 million in H1 2009 to €182.7 million in H1 2010 due to the combination of:

  • A 4.3% organic decline in revenue.
  • A 1.2% rise in revenue prompted by favourable exchange rates.
  • A 0.2% rise in revenue prompted by the full-year consolidation of companies acquired in 2009 (notably SPD in China and Thurmelec in Germany).

After the 11.2% organic decline noted in Q1 2010 due to particularly demanding comparison with record high organic growth of 38% in Q1 2009, revenue picked up rapidly in Q2 (+2.1%).

Over H1 2010 as a whole, revenue from toys and other children's products testing dropped 20.6% on a same-structure and exchange rate basis given demanding comparison in H1 2009 caused by the new

Consumer Product Safety Improvement Act (CPSIA) in the US. The Group reported healthy growth in other business segments and in particular the electrics and electronics segment.

Adjusted operating profit in the Consumer Products business fell by 6.4% due to the 2.9% decrease in revenue and slight narrowing in adjusted operating margin from 28.3% in H1 2009 to 27.3% in H1 2010.

This slight decline in adjusted operating margin stemmed from a disadvantageous product mix with a lower share of high-margin analytical testing on toys. This disadvantageous mix was offset by high structural productivity gains generated by the rising momentum of the new laboratories platform in China. Over the full-year, adjusted operating margin in the business ought to be stable compared with the 2009 level of 27.5% of revenue.

The Group is forecasting acceleration in organic growth during H2 2010, particularly in view of the end to demanding comparison with the year-earlier period caused by the CPSIA. In addition to this, growth factors in the business are set to stem from new regulations, especially the European Directive on toys and tougher standards in the local Chinese market as well as the development of new innovative solutions for improving security in client supply chains.

Government Services & International Trade

(in millions of euros) H1 2010 H1 2009 Change
Revenue 85.4 78.9 +8.2%
Adjusted operating profit 16.0 12.9 +24.0%
Adjusted operating margin 18.7% 16.3% +240bps

Revenue in the Government Services & International Trade business rose by 8.2% from €78.9 million in H1 2009 to €85.4 million in H1 2010 following:

  • Organic growth of 10.0%.
  • A 1.8% negative impact from exchange rate fluctuations due to the devaluation of the Angolan Kwanza.

Organic growth in the Government Services segment was healthy throughout H1 2010 with an increase in the FOB value of merchandise inspected as well as the rising momentum of new contracts in Indonesia, Algeria and Saudi Arabia. The international trade segment benefited from the recovery in volumes of goods inspected.

Adjusted operating profit in the business rose by 24% to €16 million driven by higher volumes and improved contract terms in Ivory Coast and Mali.

In H2 2010, the Group should benefit from further robust organic growth with the start-up of recently signed contracts (Syria, Uganda and the Philippines).

2010 half-year financial report

The 2010 half-year financial report is registered today with the French Financial Markets Authorities (AMF) and can be consulted on the Bureau Veritas website at the following address:

www.bureauveritas.com/investors under Publications/Regulated Information/Financial Reports.

Agenda

November 3, 2010 (after trading): Publication of information on Q3 2010

Appendix: Extracts of 2010 half-year Consolidated Financial Statements adopted on August 25, 2010 by the Board of Directors

Examination procedures for the half-year accounts have been undertaken and the Statutory Auditor's report published.

Consolidated income statement

(in millions of euros) H1 2010 H1 2009
Revenue 1,349.1 1,329.5
Purchases and external charges (387.3) (373.3)
Personnel costs (699.1) (678.5)
Taxes other than on income (28.8) (31.8)
Net (additions to) reversals of provisions 7.7 (10.6)
Depreciation and amortization (37.2) (34.7)
Other operating income 10.4 6.5
Other operating expense (1.1) (1.7)
Operating profit 213.7 205.4
Income from cash and cash equivalents 1.0 0.9
Finance costs, gross (19.1) (24.8)
Finance costs, net (18.1) (23.9)
Other financial income 10.0 0.4
Other financial expense (7.1) (4.7)
Net financial expense (15.2) (28.2)
Share of profit of associates (0.1) -
Profit before income tax 198.4 177.2
Income tax expense (54.4) (44.7)
Profit from continuing operations 144.0 132.5
Profit from discontinued operations and operations held for sale - 0.4
Net profit for the period 144.0 132.9
Attributable to:
Equity holders of the company 140.8 130.5
Minority interests 3.2 2.4
Earnings per share (euros):
Basic earnings per share 1.30 1.21
Diluted earnings per share 1.28 1.19

Consolidated statement of financial position

(in millions of euros) June 2010 Dec. 2009
Goodwill 936.2 832.2
Intangible assets 176.0 171.4
Property, plant and equipment 220.4 208.2
Investments in associates 0.5 0.6
Deferred income tax assets 63.4 66.3
Investments in non-consolidated companies 0.4 0.4
Other non-current financial assets 37.2 31.2
Total non-current assets 1,434.1 1,310.3
Trade and other receivables 891.8 798.9
Current income tax assets 26.6 20.2
Current financial assets 6.9 7.9
Derivative financial instruments 69.9 13.8
Cash and cash equivalents 169.1 147.0
Total current assets 1,164.3 987.8
Assets held for sale - -
TOTAL ASSETS 2,598.4 2,298.1
Share capital 13.1 13.1
Retained earnings and other reserves 686.5 476.6
Equity attributable to equity holders of the Company 699.6 489.7
Minority interests 9.0 11.5
Total equity 708.6 501.2
Bank borrowings 833.0 740.8
Other non-current financial liabilities 1.6 1.9
Deferred income tax liabilities 25.2 35.2
Pension plans and other long-term employee benefits 89.2 88.0
Provisions for other liabilities and charges 88.3 102.8
Total non-current liabilities 1,037.3 968.7
Trade and other payables 649.9 632.8
Current income tax liabilities 66.3 57.2
Derivative financial instruments 18.5 42.6
Total current financial liabilities 117.8 95.6
Total current liabilities 852.5 828.2
Liabilities held for sale - -
TOTAL EQUITY AND LIABILITIES 2,598.4 2,298.1

Consolidated statement of cash flows

(in millions of euros) June 2010 June 2009
Profit before income tax 198.4 177.2
Elimination of cash flows from financing and investment activities 19.8 24.2
Provisions and other non-cash items (7.3) 4.5
Depreciation, amortization and impairment 40.0 34.7
Movements in working capital attributable to operations (69.4) (11.0)
Income tax paid (63.4) (35.5)
Net cash generated from operating activities 118.1 194.1
Acquisitions of subsidiaries (16.7) (32.7)
Proceeds from sales of subsidiaries 7.9 -
Purchases of property, plant and equipment and intangible assets (28.1) (27.8)
Proceeds from sales of property, plant and equipment and intangible assets 0.6 0.1
Purchases of non-current financial assets (12.4) (5.1)
Proceeds from sales of non-current financial assets 2.0 2.1
Other 1.1 5.2
Net cash used in investing activities (45.6) (58.2)
Capital increase 0.5 1.8
Purchases/sales of treasury shares 0.5 0.8
Dividends paid (84.6) (77.9)
Increase in borrowings and other debt 119.2 66.1
Repayment of borrowings and other debt (95.3) (158.6)
Interest paid (17.2) (23.2)
Net cash used in financing activities (76.9) (191.0)
Impact of currency translation differences 11.2 (0.3)
Net increase (decrease) in cash and cash equivalents 6.8 (55.4)
Net cash and cash equivalents at beginning of period 139.3 145.4
Net cash and cash equivalents at end of period 146.1 90.0
o/w cash and cash equivalents 169.1 105.7
o/w bank overdrafts (23.0) (15.7)

Bureau Veritas

Bureau Veritas is the world's second largest group in conformity assessment and certification services. Created in 1828, the group has more than 47,000 employees in 1,000 offices and 330 laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performances by offering services and innovative solutions in order to ensure that their products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

Bureau Veritas is listed on the Euronext Paris (Compartment A, code ISIN FR 0006174348, stock symbol: BVI). www.bureauveritas.com

This press release 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 filed by Bureau Veritas with the Autorité des marchés financiers (Registration Document) that could cause actual results to differ from the plans, objectives and expectations expressed in such forward-looking statements. These such forward-looking statements speak only as of the date on which they are made, and Bureau Veritas undertakes no obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

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Analyst/Investor conference

Date: Thursday August 26, 2010

Time: 2.00 p.m. CEST

The conference is to be held in English. It will be broadcast live, with a recording subsequently available on the Group's website: www.bureauveritas.com/investors.

The presentation document will also be available on the website.

Contacts

Analysts/Investors

Bureau Veritas Claire Plais +33 (0)1 55 24 76 09 Domitille Vielle +33 (0)1 55 24 77 80 [email protected]

Press

Bureau Veritas Véronique Gielec +33 (0)1 55 24 76 01 [email protected] Golin Harris Amandine Pesqué +33 (0)1 40 41 56 17 [email protected]

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