Veolia Environnement, the French waste and water utility trying to reduce debt, reported a larger-than-estimated 2011 loss on restructuring costs and a business slowdown in southern Europe and north Africa.
The net loss was 490 million euros ($653 million) compared with a restated profit of 559 million euros a year earlier, the Paris-based company said in a statement. That was greater than the average estimate of a 281 million-euro loss of seven analysts surveyed by Bloomberg.
Veolia will narrow its geographic reach to about 40 countries in a bid to lower debt to less than 12 billion euros by the end of 2013, the company said. Net financial debt was 14.73 billion euros at Dec.31, down from 15.22 billion euros a year earlier.
This year “will be the first for the transformation of Veolia after a year of transition,” Chief Executive Officer Antoine Frerot said on a conference call. He declined to provide an outlook for earnings for 2012 or comment on his future as chief executive at the water provider.
Frerot is seeking to revive the utility amid reports that his predecessor Henri Proglio, who remains a director, was trying to garner board support for a replacement. Frerot’s revamp would undo a legacy of expansion under Proglio that took the utility to 77 countries from Argentina to South Korea. Veolia has lost about half its market value since mid-July.
Veolia rose as much as 6.2 per cent, its biggest intraday gain in five months. It traded 5 per cent higher at 9.65 euros as of 9:41 a.m. in Paris and was the biggest gainer on the benchmark CAC 40 index, followed by Safran SA, up 1.1 per cent.
Operating income fell to 1.02 billion euros from 1.98 billion euros a year earlier. Sales advanced 3.1 per cent to 29.6 billion euros.