PARIS, France – A “lackluster” economic environment in France has been labelled as part of the reason for a dip in revenues from SUEZ’s European water division.
Financial results released from the company today showed that revenues in the Water Europe division dropped by 0.8% in the first nine months of the year.
Revenue in France during this period was down 4.4%, which SUEZ put down to “modest” 0.2% tariff increases and the end of a contract in Lille, which took €62 million away in revenue.
Meanwhile, Spain and Chile generated growth of 2.1% for the French company, with water sales up by 0.8% in Spain.
For industrial water, the acquisition of Indian treatment company Driplex earlier this year helped contribute €129 to the company’s financials, along with other buys such as a solid waste company in Australia.
Overall, taking into account the company’s three divisions – Water Europe, Recycling & Recovery Europe and International – group revenue was up 2.6% to €11.2 billion.
SUEZ’s share price climbed 1.3% to €14.34 following the announcement of the financial results.
News of SUEZ’s European water division revenues declining will no doubt be disappointing for the company, after the division achieved 3.3% growth in 2015.
Jean-Louis Chaussade, CEO, SUEZ, said: “Business growth remains sound, despite the persistently lackluster macroeconomic environment in France. It continues to be fuelled by our performance outside Europe. The improvement in operational profitability in the third quarter puts us on track to meet our 2016 targets. In particular, it reflects the additional efforts we decided in order to offset the unfavorable weather conditions during the first half of the year.
“During the summer, we also continued to implement the transformation plan to make the group more efficient, more agile, more transverse in order to meet the environmental and climate challenges. As soon as 2017, this plan will generate 40 million euros of savings on a full-year basis.”