Suez Posts 2.9% Gain in Net Profit, Has Eyes of GE's Water Business
March 01 2017 - 3:07AM
Dow Jones News
By Inti Landauro
PARIS--French water and waste-management services supplier Suez
SA (SEV.FR) posted a 2.9% rise in net profit on growth at its
international businesses outside of Europe, where demand remained
sluggish, and signaled interest in buying the water assets of
General Electric Co. (GE).
Suez Chief Executive Jean-Louis Chaussade said buying the GE
business, which the U.S. company said was up for sale last
December, fitted well with the French company's plans to grow its
provision of water services to industry. Mr. Chaussade declined to
mention a price or any detail on how Suez, primarily a provider of
water services to municipalities, would finance the possibly
multibillion-dollar acquisition.
Suez's net profit rose to 420 million euros ($445 million) in
the year to end-December, up from EUR408 million in 2015, on a 1.2%
rise in revenue to EUR15.32 billion revenue and
better-than-expected cost control, the company said. Analysts
polled by FactSet expected an average net profit of EUR432 million
and revenue of EUR15.30 billion.
The company, whose major shareholder is energy company Engie SA,
said it managed to cut costs by EUR180 million last year up from a
EUR150 million target.
Faced with slow business in France and the rest of the European
Union in recent years, Suez had expanded in international markets
to benefit from stronger demand there. The company generated 33% of
its revenue from outside Europe in 2016, up from 26% a year
earlier. Revenue from its international unit rose 7% in the year
while revenue fell 1.9% in France and 0.7% in Europe outside
France, the company said.
Suez expects revenue and earnings before taxes and interest to
rise slightly this year.
The company kept its dividend unchanged at EUR0.65 a share and
said it intends to keep the dividend at the same level or raise it
next year.
-Write to Inti Landauro at inti.landauro@wsj.com
(END) Dow Jones Newswires
March 01, 2017 02:52 ET (07:52 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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