VINCI - 2012 annual report

VINCI - 2012 annual report

2012 Annual Report French public limited company (“Société anonyme”) with capital of €1,449,044,392.50 Registered office: 1 cours Ferdinand de Lesse...

11MB Sizes 0 Downloads 56 Views

2012 Annual Report

French public limited company (“Société anonyme”) with capital of €1,449,044,392.50 Registered office: 1 cours Ferdinand de Lesseps 92500 Rueil Malmaison - France Registration number: 552 037 806 RCS Nanterre www.vinci.com

CHANGES MADE TO THE 2012 REGISTRATION DOCUMENT FILED WITH THE AUTORITE DES MARCHES FINANCIERS (AMF – THE FRENCH SECURITIES REGULATOR) ON 27 FEBRUARY 2013 UNDER THE NUMBER D.13-0085

This registration document, prepared on 26 April 2013 under the responsibility of the Chairman and Chief Executive Officer, supersedes the version filed with the French securities regulator (AMF) under the number D.13-0085 on 27 February 2013. That version contained an error in Note 15.2 to the consolidated financial statements relating to the financial information on companies accounted for under the equity method. The error was not identified until after approval of the financial statements by the Shareholders’ General Meeting on 16 April 2013. Contrary to what was shown under Contracting and VINCI Immobilier in the second table of the note in question, net financial debt of companies accounted for under the equity method was €651.1 million (not €174.7 million) in 2012. With the exception of this clarification, which has been added as a footnote, no other change has been made to the registration document.

Below is the table as it now appears on page 229 of the 2012 registration document available on VINCI’s website at www.vinci.com

31/12/2012

31/12/2011

Concessions

Contracting and VINCI Immobilier

Total

Revenue

543.5 

1,708.2 

Operating income

114.4 

127.3 

3.5 

(in € millions)

Concessions

Contracting and VINCI Immobilier

Total

2,251.7 

502.0 

1,670.6 

2,172.6 

241.7 

75.6 

134.7 

210.3 

78.6 

82.1 

(17.2)

67.6 

50.5 

Income statement

Net income Balance sheet Non-current assets

2,818.0 

1,805.3 

4,623.3 

2,118.6 

1,485.6 

3,604.2 

Current assets

652.4 

1,090.5

1,742.9 

544.4 

1,051.4

1,595.8 

Equity

310.8 

(629.6)

(318.8)

197.5 

(609.5)

(412.0)

(2,976.8)

(1,192.1)

(4,168.9)

(2,141.5)

(918.3)

(3,059.8)

Current liabilities

(804.5)

(1,074.0)

(1,878.5)

(719.1)

(1,009.0)

(1,728.1)

Net financial debt

(2,705.2)

(174.7) (*)

(2,879.9)

(1,994.1)

(516.6)

(2,510.8)

Non-current liabilities

(*) Additional information inserted on 26 April 2013: Contrary to what is shown under Contracting and VINCI Immobilier above, net financial debt of companies accounted for under the equity method was €651.1 million (not €174.7 million) in 2012. Total net financial debt of companies accounted for under the equity method was therefore €3,356.3 million at 31 December 2012 instead of €2,879.9 million.

2012 Annual Report

Contents

01 Profile 02 2012 Album 12 Message from the Chairman and CEO 13 Corporate governance 14 Corporate management structures 16 Strategy and outlook 18 Sustainable development 30 Stock market and shareholder base 32 Concessions

34 VINCI’s concessions worldwide 36 VINCI Autoroutes

50 VINCI Concessions 66 Contracting

68 VINCI Energies 80 Eurovia

92 VINCI Construction

109 General & financial elements 110 Report of the Board of Directors

179 Report of the Chairman of the Board on

corporate governance and internal control procedures 194 Report of the Vice-Chairman and Senior Director of the Board of Directors 195 Consolidated financial statements 276 Parent company financial statements 293 Special report of the Statutory Auditors on regulated agreements and commitments 298 Persons responsible for the registration document 299 Registration document table of correspondence

Group

Key figures

€38.6 billion

€20.7 billion

Revenue

Operating income from ordinary activities

Revenue (1)

Market capitalisation at 31 December 2012

(in € millions)

36,956 (1) 690

(in € millions and as a percentage of revenue (1))

38,634 (1) 550

3,660

3,671

13,394

14,310

23,562

24,324

9.9%

9.5%

2011

2012

2011

2012

France International Concession subsidiaries’ works revenue

Revenue by geographical area (1) (in € millions and as a percentage)

France Germany United Kingdom Benelux Central and Eastern Europe Rest of Europe Americas Africa Asia, Middle East, rest of the world

24,324 2,374 2,257 1,614 2,001 1,101 1,832 1,695

63.0% 6.1% 5.8% 4.2% 5.2% 2.8% 4.8% 4.4%

1,435

3.7%

Workforce at 31 December

Concessions

15,450

8.0%

Contracting

176,522

91.6%

Property and holding companies 729

0.4%

€1,917 million

265,000

192,701

Net income attributable to owners of the parent

Cash flow from operations (4)

Net financial debt at 31 December

Net income attributable to owners of the parent

projects (2)

employees worldwide (3)

(in € millions and as a percentage of revenue (1))

(in € millions)

(in € millions and as a percentage of revenue (1))

1,904

1,917

5,366

5,418

5.2%

5.0%

14.5%

14.0%

2011

2012

2011

2012

Revenue by business (1) (in € millions and as a percentage)

12,590

12,527

2011

2012

Operating income from ordinary activities by business (in € millions and as a percentage)

Concessions

5,354

13.9%

Concessions

2,159

58.8%

Contracting

33,090

85.6%

Contracting

1,403

38.2%

0.5%

Property and holding companies

109

3.0%

Property and intragroup eliminations

190

Net income attributable to owners of the parent by business

Cash flow from operations by business (4)

Concessions

886

46.2%

Concessions

3,372

62.2%

Contracting

915

47.7%

Contracting

1,875

34.6%

116 6.1%

Property and holding companies

172

3.2%

(in € millions and as a percentage)

(in € millions and as a percentage)

Property and holding companies

(1) Excluding concession subsidiaries’ works revenue. (2) Estimate. (3) At 31 December 2012. (4) Before tax and financing costs.

VINCI 2012 Annual Report

Group

Profile VINCI is a global player in concessions and construction, employing close to 193,000 people in some 100 countries. We design, finance, build and operate infrastructure and facilities that help improve daily life and mobility for all. Because we believe in all-round performance, above and beyond economic and financial results, we are committed to operating in an environmentally and socially responsible manner. And because our projects are in the public interest, we consider that reaching out to all our stakeholders and engaging in dialogue with them is essential in the conduct of our business activities. VINCI’s goal is to build long-term value in this way for its customers, shareholders and employees, and for society at large.

1

2

2012 Album Group

The year in facts and images

Training equipment operators

Before joining a worksite, earthmoving equipment operators receive six weeks of classroom instruction provided by local training organisations, followed by four weeks of practical training focused mainly on equipment operation, which includes 70 hours of practice on a several-hectare site specially developed at each training hub to simulate worksite conditions. During practice, trainees are supervised by a professional instructor and a mentor from one of the consortium companies. Beyond preparing employees to work on this project, the extensive training effort will have a lasting impact on the regions.

VINCI 2012 Annual Report

Group 2012 Album

3

Dominique Morin Regional director, Poitou-Charentes Pôle Emploi

“State-run job centre Pôle Emploi serves as the point of contact for local recruitment for the SEA HSL project. We work closely with COSEA to match recruits with requirements. Pôle Emploi has established a special regional coordination unit in the construction company’s premises to work closely with its human resource teams. In addition, to ensure recruitment throughout the region and to reach out to job-seekers, we have set up other teams along the route.”

SEA HSL: a highspeed workforce development project The SEA Tours-Bordeaux HSL is set to become one of the largest rail infrastructure projects of our time, encompassing a 302 km high-speed line, 415 bridges and tunnels and 240 hydraulic structures. Before that, however, it has become a major workforce development project. The concession and construction company has committed to recruit and train 1,200 people locally (the actual number will exceed 1,400), of which 400 registered on work integration programmes. To achieve this, a special public-private partnership has been set up by COSEA, the construction joint venture, and government departments, regional and departmental councils, local authorities, chambers of commerce and industry, and work integration companies. By the end of 2012, 1,000 people (two-thirds of whom met the integration through work criteria) had been hired. Nine training hubs – five for earthworks and four for civil engineering – had been set up along the route. In their first nine months of operation, between March and December 2012, these hubs trained nearly 900 people. On its own initiative, COSEA, later joined by concession company LISEA, worked with the Fondation VINCI to create a project-specific solidarity fund, known as Sillon Solidaire, with an annual budget of €310,000. The fund provides financial assistance and employee sponsors to support non-profit organisations combating social exclusion in the regions along the SEA line. A social and economic observatory was also created in 2012 under LISEA operational management. It will be tasked with tracking the project’s socioeconomic impact on the regions concerned for a period of 10 years once the line is open.

4

Group 2012 Album

VINCI 2012 Annual Report

Group 2012 Album

5

Leary Myers Chairman of the National Water Commission (NWC)

Water supply networks: support for developing countries “Since 1999, VINCI Construction Grands Projets has carried out around 10 projects for the NWC in Jamaica. We now supply safe drinking water to almost 73% of the population; our goal is to reach 85% within the next five or six years. I knew of the company’s reputation before becoming chairman. Since then, I’ve been able to form excellent working relations with it, because the company is responsible and it knows our country well and the environment here. That’s what we expect of a partner. What we find particularly satisfactory in our collaboration with VINCI is above all the quality of the work and that schedules and budgets are respected. What we also want is that our partner’s expertise be shared with local subcontractors so that they can provide repair and maintenance work under contracts with us.”

VINCI Construction Grands Projets is working on a growing number of projects in the water sector in countries around the world, and particularly in developing countries. Since 1999, the company has been participating in the programme to renovate Jamaica’s water treatment plants and distribution systems, and carrying out significant metering improvement or replacement works. In total, almost 120 km of water supply pipes have been installed in Jamaica, over 2,000 km of supply systems have been audited and more than 95,000 water meters installed or replaced. Work has been carried out on water treatment systems representing capacity of 375,000 cubic metres per day. Close to 1 million users have benefited from this work, several thousand of which did not previously have access to running water. Drinking water supply, which was previously limited to just a few hours a day, now operates up to 24/7 for several of the island’s networks. In an extension to the first phase of the Jamaica Water Supply Improvement Project recently completed in the capital, Kingston – voted the Jamaican Institution of Engineer’s “Project of the year 2012” (out of all engineering projects carried out on the island) – VINCI Construction Grands Projets has been awarded a new phase of works. This latest contract is to replace the water transfer pipes to Kingston, rehabilitate one major north-east coast water treatment plant, carry out major repairs to two others, improve two rural water supply systems, and implement a second phase of meter replacements or installation across the island. A new contract was also signed in Port Antonio for a project covering the supply and installation of urban pipelines for drinking water, sewerage and drainage, as well as dredging and construction works for coastal defence. The client’s latest show of confidence is a demonstration of the company’s excellent knowledge of the local context, technical expertise and capacity to work in close collaboration with the client. In 2012, VINCI Construction Grands Projets also worked on projects to improve water supply systems in Djibouti, Pakistan, Sri Lanka and Vietnam.

6

Group 2012 Album

VINCI 2012 Annual Report

Group 2012 Album

7

Alain Masson Vice-Chairman of Brest Métropole Océane, responsible for sustainable development and major projects

“We are proud and satisfied with the essential work accomplished with the tramway coming into service. Despite the drawbacks inherent to this type of development project, the works were completed in line with the initial schedule and budget and – this is worth stressing – without any serious accident. Leaving aside landmark moments like the welding of the first and last rails and, of course, the arrival of the first tram, what strikes me is the extra­ordinary change it has brought to some very characteristic areas of the city. I’m thinking in particular of the Pontanézen area. What with the arrival of the tram and the urban regeneration operation, you feel you’re living in a completely different neighbourhood! This is the advantage of this type of project, which provides an opportunity to rethink a whole section of a city. In addition, the arrival of the tramway contributes to a more positive perception of the city – for residents and visitors alike – and also to the dynamism of the urban community as a whole.”

The Brest tramway: driver of urban beautification In 2010, Eurovia and ETF-Eurovia Travaux Ferroviaires, in a consortium with two local firms, convinced Brest Métropole Océane to entrust them with full delivery of the urban community’s first tram line. Over 36 months, the teams – as many as 70 during peak periods – built a 14.3 km line connecting the main residential and business neighbourhoods from the districts of Guipavas and Guesnou to the west and Plouzané to the east. Eurovia and ETF-Eurovia Travaux Ferroviaires carried out all the work required to develop the tramway, a landmark project for the city: deconstruction of existing buildings and facilities, re-routing of utilities, construction of the platform, end-to-end infrastructure works, installation and adjustment of the track and the overhead contact line, surfacings, creation of parkand-ride facilities, signalling equipment, and fitting out the 27 stops and other facilities. For three years, they had to both minimise the impact of the worksite for local residents and shops and “keep up the pace” to respect the opening date, set for 23 June 2012. They delivered on their promises – and the welcome given this new mode of green transport by Brest residents didn’t disappoint their expectations.

8

Group 2012 Album

VINCI 2012 Annual Report

Group 2012 Album

9

Raymond Vial Chairman of the Loire Chamber of Agriculture

“Collaboration between the farming world and ASF wasn’t a foregone conclusion. The first contacts were tense, but in the end we all realised that since the motorway was going to go ahead, we had to work together and learn to understand each other. Everyone worked hard on the ground and on a case-by-case basis, and made an effort to smooth out the rough edges and find the best solution for every farmer whose land was affected by the motorway. This process of consultation made it possible to conduct a whole series of land release operations. In the Loire département, 200 hectares of farmland were set aside and redistributed, with most farmers being given the equivalent of what they had lost, either in terms of surface area or agronomic value.”

Shared governance for the A89 motorway As is now the tradition, local residents – on foot, bicycle or push scooter – were the first to discover the new and last section of the A89 motorway, which was opened to visitors in December 2012 before its inauguration on 19 January 2013. The entry into service of this 53 km section between Balbigny and La Tour de Salvagny marked the completion of this major 500 km transversal artery linking the west coast city of Bordeaux to the outskirts of Lyon in just five hours 15 minutes. The last section represented a €1.5 billion investment for VINCI Autoroutes and 8.5 million hours of work for the 2,000 companies of all sizes – including VINCI companies – that participated in the project. From the first studies right through to full entry into service, the project involved proactive collaboration between the public and private players that share its governance: government departments, elected officials and local authorities, motorway concession companies, official farmers’ associations, construction companies, non-profits and civil society, and client representatives. This ongoing dialogue with stakeholders focused in particular on the environmental aspects. From defining biodiversity conservation measures to environmental training for all project teams, the nature protection non-profit organisations were involved throughout the design and construction of the motorway. They will also be included in the monitoring system that has been set up. Framed by a specific agreement, the system will make it possible to check, over time, the effectiveness of the biodiversity conservation measures put in place.

10

Group 2012 Album

VINCI 2012 Annual Report

Group 2012 Album

11

Marc Sohet Vice President, Engineering, GSK Vaccines

“What GSK Vaccines expects of its suppliers is that they deliver on their commitments in terms of schedule, quality of works, and the performance of all the systems and equipment supplied. The different VINCI entities, each with their own expertise, work hard to meet these expectations (the “what”) – and they do it very effectively in terms of technological innovation and their command of complex technical projects (the “how”). This gives them a genuine competitive lead. Combined with the high level of communication, whether technical, commercial or strategic, this makes the VINCI Group an ideal partner for GSK Vaccines in civil engineering, electricity, air conditioning and clean piping(*). As a group, VINCI is capable of covering a large part of the needs related to construction of new laboratories.”

Networks with very strict specifications In 2012, GSK Vaccines awarded VINCI Energies Belgium the E&I (electricity and instrumentation) and clean piping(*) works packages on the WN 158 project, a new vaccines production unit in the heart of the complex built for GSK in Wavre, Belgium. The configuration of the building, which houses production facilities for different vaccines over two floors, requires compliance with the very stringent specifications required for sterile environments and introduces special constraints in carrying out the works, which were awarded to Cegelec Building Project (mains and low-voltage electricity) and Cegelec Ensysta (clean piping). All the technical installations are located in the false ceilings so that operatives do not have to enter sterile rooms to work on them. Given the density of the installations, this special requirement made it essential to have perfect coordination between the different companies involved in the execution phase. For the electricity part, the works entailed installing 16,000 metres of cable trays, 4,400 lighting devices, 1,650 fire detectors, 54 instrument panels and one 400 Kva UPS unit, plus structured fibre optic and copper networks and equipment for access control and environment monitoring in the clean zone. The clean piping package involved 29,000 metres of piping, 1,800 manual valves, 500 pneumatic valves, 13 preparation vats connected to thermal control units, and more. To ensure overall control of the technical work, coupled with the time challenge (16 months to carry out the job), a project manager was appointed to supervise and coordinate the 181 employees of the two companies working on the project, while acting as the client’s sole point of contact for all aspects. (*) Engineering, implementation and piping tests (tap water, purified water, clean steam, clean compressed air).

12

Group

Message from the Chairman and CEO

“The forces driving growth in our markets are as powerful as ever, and our businesses are central to the challenges of tomorrow.” Xavier Huillard

VINCI enjoyed another vigorous year in 2012. Our growth strategy passed an important milestone at the end of the year with the plan to acquire the Portuguese airports previously managed by the state, including the Lisbon hub. We expect to close the deal sometime in the middle of 2013. VINCI Airports thus now emerges as a front-rank international player in a market stimulated by constant growth in air traffic. The move also represents another major step forward in the Group’s expanding Concessions business, seven years after becoming Europe’s number one motorway operator with the formation of VINCI Autoroutes. Key figures for 2012 once again show how sturdy our model is, with revenue up 4.5%, and a slight increase in operating income and net income despite tough business conditions, in Europe especially. In France, the pace of work is quickening on the SEA Tours–Bordeaux high-speed rail link, and is set to reach full speed in 2013, confirming our Group’s outstanding capacity to harness its resources and extract synergies from all its business lines. On our motorways, we illustrated our role as an investor serving the public interest via the hundreds of environmental projects making up the green motorway package and by completing the A89 near Lyon. Meanwhile, the operational synergies between our different motorway networks allowed us to go on improving profitability even though traffic growth was flat. In our Contracting business, our companies held up well overall in France and the rest of Europe, even though economic conditions were tougher than in 2011. They expanded in markets outside Europe thanks to a combination of dynamic local networks and significant new contracts for major projects. While expanding in Concessions and pursuing our strategy of balancing growth between our two main businesses, we have continued to make acquisitions in the Contracting business. The takeover of GA Gruppe has made VINCI Energies a major player in its business activities in Germany, with solid positions in the industrial and energy sectors, notably. Outside the European Union, we have stepped up our international expansion with further moves into new growth markets, acquiring two companies in India (one in roadworks and the other in automated systems for industry), while the acquisition of Carmacks in Canada has extended Eurovia’s presence in the province of Alberta. The 2% growth in our order book over the year, to €31.3 billion at year-end, is grounds for confidence. It also gives us the visibility we need to take timely but essential measures in those markets hardest hit by business conditions, which are likely to remain weak in 2013. Looking further ahead, the forces driving growth in our markets are as powerful as ever. The major challenges facing tomorrow’s world are urban growth, mobility, and the energy transition. Our business activities are central to those challenges, and VINCI’s profile is fully aligned with the trend in our markets towards ever more comprehensive and more complex projects. We aim to deepen this model going forward so that the Group becomes more international, providing ever more creative products and services and more comprehensive solutions. We will be partnering our clients and engaging in proactive dialogue with stakeholders in our projects, in order to build the amenities and infrastructure that tomorrow’s world demands.

VINCI 2012 Annual Report

Group

Corporate governance

Board of Directors Xavier Huillard

Chairman and Chief Executive Officer, VINCI

Yves-Thibault de Silguy

Vice-Chairman and Senior Director of the Board, VINCI

Élisabeth Boyer

Operations control centre supervisor, Cofiroute Chairman of the Supervisory Board of the Castor and Castor Relais corporate mutual funds

Robert Castaigne

Former Chief Financial Officer and former member of the Executive Committee, Total

François David (1)

Honorary Chairman, Coface SA

Patrick Faure (1)

Chairman, Patrick Faure et Associés

Dominique Ferrero

Adviser to the Chairman of Natixis

Jean-Pierre Lamoure

Chairman of the Supervisory Board, Atlantic SFDT

Jean-Bernard Lévy

Chairman and Chief Executive Officer, Thales

Michael Pragnell (2)

Chairman of the Council of Trustees, Cancer Research UK

Henri Saint Olive

Chairman of the Board, Banque Saint Olive

Pascale Sourisse

Senior Vice-President, International Development, Thales

Qatari Diar Real Estate Investment Company

Company registered under Qatari law, represented by Abdul Hamid Janahi

Individuals whose appointments as Directors are proposed to the Shareholders’ General Meeting of 16 April 2013

Yannick Assouad

Chief Executive Officer, Aircraft Systems, Zodiac Aerospace

Graziella Gavezotti

Chief Operating Officer, Southern Europe, Edenred

(1) The appointments of François David and Patrick Faure will expire at the close of the Shareholders’ General Meeting of 16 April 2013. (2) Renewal of appointment for a period of four years proposed to the Shareholders’ General Meeting of 16 April 2013. (3) Permanent members. The Strategy and Investments Committee is open to any member of the Board who wishes to participate.

13

Audit Committee This committee helps the Board monitor the accuracy and fair presentation of VINCI’s consolidated and parent company financial statements, as well as the quality of financial information. Composition:

Henri Saint Olive (Chairman) Robert Castaigne Michael Pragnell Pascale Sourisse

Appointments and Corporate Governance Committee This committee examines all candidacies for appointments to the Board, prepares recommendations on the appointment of executive company officers and succession planning, and ensures the rules of corporate governance are applied. Composition:

Yves-Thibault de Silguy (Chairman) Patrick Faure Dominique Ferrero

Strategy and Investments Committee This committee helps the Board develop the Group’s strategy. It examines proposed investments and divestments that could have a material impact on the Group’s consolidation scope, business activity, results or stock market performance. Composition (3):

Yves-Thibault de Silguy (Chairman) Élisabeth Boyer Jean-Pierre Lamoure The permanent representative of Qatari Diar Real Estate Investment Company

Remuneration Committee This committee proposes the terms and conditions of remuneration of company officers to the Board. Composition:

Jean-Bernard Lévy (Chairman) Robert Castaigne François David

14

Group

Corporate management structures

1

2

3

6

7

8

11

12

1

4

Chairman and Chief Executive Officer, VINCI

Chairman, VINCI Construction

2013 Executive Committee The Executive Committee is responsible for managing VINCI. It met 22 times in 2012.

Xavier Huillard

Jean Rossi

2

5

Executive Vice-President and Chief Financial Officer, VINCI

Chairman and Chief Executive Officer, Eurovia

Christian Labeyrie

3

Richard Francioli

Executive Vice-President, Contracting, VINCI

Jacques Tavernier 6

Louis-Roch Burgard Chairman, VINCI Concessions 7

Pierre Coppey

Chairman, VINCI Autoroutes

VINCI 2012 Annual Report

Group Corporate management structures

15

2013 Management and Coordination Committee The Management and Coordination Committee brings together the members of the Executive Committee and senior VINCI executives. Its remit is to ensure broad discussion of VINCI’s strategy and development. It met four times in 2012.

Hervé Adam 4

5

Chief Executive Officer, VINCI Energies France

Pierre Anjolras

Chief Operating Officer, Eurovia

Renaud Bentégeat

Managing Director, CFE

Gérard Bienfait

Chairman, VINCI Construction France

Alain Bonnot

Chairman, VINCI Construction Grands Projets

Dominique Bouvier

Chairman and Chief Executive Officer, Entrepose Contracting

Philippe Chavent

Chairman, Sogea-Satom

9

10

Serge Clémente

Chairman and Chief Executive Officer, VINCI Park

Dominique Collomp

Deputy Managing Director, Eurovia

Philippe-Emmanuel Daussy

Chairman and Chief Executive Officer, Escota

Arnaud Grison

Chief Executive Officer, VINCI Facilities

Jean-Pierre Lamoure

Honorary Chairman, Soletanche Freyssinet

Olivier de la Roussière

Chairman, VINCI Immobilier

Bernard Latour

Chief Executive Officer, VINCI Energies International

Patrick Lebrun

Deputy Managing Director, VINCI Energies

13

Sébastien Morant

Deputy Managing Director, Operations, ASF

8

11

Christophe Pelissié du Rausas

Chief Operating Officer, VINCI Construction

Vice-President, Human Resources and Corporate Social Responsibility, VINCI

Loïc Rocard

Bruno Dupety 9

Yves Meignié

Chairman and Chief Executive Officer, VINCI Energies 10

Jean-Luc Pommier

Vice-President, Business Development, VINCI

Franck Mougin

12

Pierre Duprat

Vice-President, Corporate Communications, VINCI 13

Patrick Richard

General Counsel, VINCI Secretary to the Board of Directors

Executive Vice-President, Programme Management, VINCI Concessions

Chief Executive Officer, Cofiroute

Fadi Selwan

Executive Vice-President, Business Development, VINCI Concessions

John Stanion

Chairman & Chief Executive, VINCI plc

Jérôme Stubler

Chief Executive Officer, Soletanche Freyssinet

Guy Vacher

Chief Operating Officer, Eurovia

16

Group

Strategy and outlook

Combining growth and resilience

The key to VINCI’s strategy is the three-way fit between its Concessions business and its Contracting business (the latter comprising Energy, Roads and Construction), in terms of: – operating cycles: long in Concessions, and short to medium term in Contracting; – financial considerations: Concessions are capital intensive and generate recurring revenues, whereas Contracting requires relatively little capital but is structurally cash positive; – mutually reinforcing expertise: programme organisation and financing, and project management during construction and operation in Concessions; and the capacity to design, build and maintain complex structures in Contracting. This strategic model has served VINCI well since its inception, underpinning its expansion in times of economic growth and providing resilience in a cyclical downturn. VINCI’s managerial culture combines decentralisation and autonomy for its operating subsidiaries with empowerment for its managers and a networked approach to operations. These underlying principles encourage individuals and groups to perform to their best, while making VINCI companies exceptionally responsive to market conditions. In today’s uncertain economic climate, VINCI’s first priority is to consolidate the fundamentals underpinning its strategic model. Its deployment across a broad array of business activities and a growing number of markets and regions is making it sturdier than ever. Moreover, the medium-term visibility afforded by the Contracting business’s order book allows these business lines to adjust swiftly to cyclical shifts. In turn, this responsiveness allows the Group to anticipate market developments. Rigorously applied principles now hard-wired into the Group’s managerial reflexes – starting with selective order-taking, tight control of overheads and a ceaseless quest for productivity gains – will preserve the margins and competitiveness of VINCI’s companies.

01

Balanced growth across VINCI’s two main businesses

VINCI’s strategy is to continue building on this model and achieve balanced growth in its two main businesses. Major recent external growth operations illustrate this strategy. The acquisition of ASF in 2006 and the subsequent creation of VINCI Autoroutes brought about a change of scale in Concessions. In recent years, the Group has focused on building up its Contracting business, with such major deals as the acquisitions of Soletanche Bachy, Entrepose Contracting and Taylor Woodrow in

01 With the takeover now in progress of ANA, which holds the concession for Portugal’s 10 main airports, VINCI is entering into a new phase in the development of its Concessions business.

Construction; of ETF (rail sector works) and Tarmac (quarry products) in Roads; and of Etavis, Cegelec and GA Gruppe in Energy, to mention the most important of these. The takeover now in progress of ANA, which holds the concession for Portugal’s 10 main airports (see p. 56), ushers in a new phase in the development of the Concessions business. In addition to structurally important operations like these, the two businesses intend to pursue their robust expansion. A major focus of external growth in Contracting will be VINCI Energies business activities along with highly technical activities with global prospects, such as specialised civil engineering, and oil and gas infrastructure.

VINCI 2012 Annual Report

Group Strategy and outlook

Faster international growth

The 2012 acquisitions of NAPC and Vasundara in India and of Carmacks in Canada, coming on top of the major deals in Germany and Portugal already mentioned, are evidence of VINCI’s drive to speed up its international expansion. While the main focus in Europe is on the most promising businesses and markets there, VINCI is seeking new growth opportunities outside the European Union. VINCI will pursue this strategy through targeted acquisitions and vigorous organic growth. This implies leveraging the good fit between its networks of local operations, its internationally active specialty businesses, and its dedicated large projects divisions. Significant recent contracts won in Africa, the Asia-Pacific region and on the American continent show that this drive is paying dividends.

A culture of partnership for better project outcomes

Simultaneously, in all areas of the Contracting business, VINCI will continue to put down ever deeper local roots in the fastest-growing markets, while bolstering the skills and resources required for the management and execution of large projects. The immediate priority in the Concessions business is to integrate ANA and shape the development of the newly enlarged VINCI Airports. The Group will also be expanding in its other areas of business – including road and rail infrastructure, parking, stadiums and major public amenities – by winning both new (greenfield) and existing (brownfield) concessions. Services to optimise the attractiveness and operational efficiency of infrastructure in service will also help to sustain business activity.

In the wider international markets as well as in VINCI’s traditional markets in Europe, ever greater synergies between and among the different business lines are a powerful force for growth. Over and beyond the customary sales-side synergies, by jointly packaging their offers and integrating all of the different know-how that projects require, Group companies are able to tackle markets otherwise inaccessible to them, such as large-scale energy and mining projects. In the same spirit, VINCI is also working to consolidate its position as an integrator of expertise. It is already applying this approach to many large infrastructure and building projects in France, and will in future deploy it more widely geographically and to ever larger projects. At the same time, VINCI will be going still further with its programme of listening to and engaging in dialogue with all stakeholders involved in its operations, in answer to customer demand and trends in civil society. This programme was restated in 2012 under the name “Together”. Its formal undertakings, published by the Group in the form of a new Manifesto in 2012 (see p. 20), are a significant step in this direction.

Markets with long-term growth potential VINCI’s business mix and model are fully aligned with deep-lying trends in its markets. Looking ahead, urban growth, increasing demand for mobility, expanding energy infrastructure needs, and ever tougher energy efficiency requirements will all entail huge investment programmes for new-build and renovation programmes in emerging and mature economies alike. At a time of falling public spending, the growing recourse to public-private partnerships (PPPs) is another factor enabling VINCI to stand out from the crowd.

17

Milestones 1891 Creation of Grands Travaux de Marseille (GTM). 1899 Creation of Girolou (power plants and grids, concessions). 1908 Creation, as part of Girolou, of Société Générale d’Entreprises (SGE). 1946 SGE, heavily involved in electricity until the sector was nationalised, moves into building and civil engineering. 1966 Compagnie Générale d’Électricité acquires control of SGE. 1970 SGE participates in the creation of Cofiroute. 1984 Compagnie de Saint-Gobain becomes SGE’s majority shareholder. 1988 Saint-Gobain sells its interest in SGE to Compagnie Générale des Eaux. 1990s Several acquisitions in the United Kingdom, Germany and central Europe make SGE a European player. 1996 SGE reorganises into four core businesses: concessions, energy, roads and construction. 1999 Acquisition of Sogeparc, French market leader in parking facilities. 2000 Vivendi (formerly Compagnie Générale des Eaux) completes its withdrawal from SGE’s share capital. Friendly takeover bid for Groupe GTM: merger of SGE-Groupe GTM to create VINCI, the world’s leading group in concessions, construction and related services. 2002 VINCI enters the CAC 40. 2006 VINCI acquires ASF, the biggest French motorway concession operator. 2007 VINCI acquires Soletanche Bachy and Entrepose Contracting. 2010 VINCI acquires Cegelec and Faceo. 2011 VINCI wins the concession for the South Europe Atlantic high-speed rail line between Tours and Bordeaux, the largest in its history. 2012 VINCI is the successful bidder for ANA, holder of the concession to operate Portugal’s airports.

18

Group

SUSTAINABLE DEVELOPMENT 

(*)

together

All our stakeholders are engaged and empowered to create value and enhance our performance.

VINCI 2012 Annual Report

OUR GOALS On our worksites and in our operating activities, we are faced with many challenges. These challenges include the need to imagine the city of the future and cope with growing urbanisation. How can buildings, neighbourhoods, cities and infrastructure be adapted to boost energy performance? How can the exponential growth of energy demand in the emerging economies be addressed, and how can the developed countries be helped to negotiate the energy transition? Can new forms of partnership between the public and private sectors be invented that benefit both and lend new legitimacy to each? We need to develop dialogue among all project stakeholders to actively involve them in transforming a city or region, and we want to engage in hands-on solidarity with underprivileged populations in the areas where our companies operate. What’s the best way of ensuring the safety of all VINCI and subcontractor employees? Of better sharing the fruits of growth with our employees around the world, combating all types of discrimination, and ensuring equality for everyone? Such challenges call for technically sound, economically realistic and socially responsible solutions.

OUR PRINCIPLES Because our projects serve the public interest and because many of them radically transform towns, cities and regions, we follow a sustainability policy that is both exacting and pragmatic. It rests on two pillars: doing our utmost to reduce the environmental impact of our activities while optimising the stakeholder benefits of our operations; and contributing to the early effort to invent new public interest solutions in an economy of scarcity.

goal is all-round 1 Our performance In assessing the performance of our companies, we look beyond their economic and financial results at the overall value they create. As urban and regional developers, we have a duty to examine the social purpose and utility of our projects while meeting the expectations of users and the community at large, and to address climate change by enhancing our projects’ environmental value. Similarly, we measure our performance by the

Group Sustainable development

extent to which our projects blend into the fabric of local communities and contribute to social and economic development.

believe in humanistic 2 We principles VINCI believes that lasting economic success must be based on an ambitious human project. Because we are builders, our humanistic values are rooted in our culture. Trust, respect, solidarity, the primacy of people over systems and the simultaneous recognition of individual initiative and teamwork – the fundamental principle of the worksite – are central to our identity as a group of entrepreneurs. These principles guide our action and conduct, and serve as inspiration for our managers and organisations.

management model 3 Our ensures our cohesion Across VINCI’s diverse business activities, geographical areas and people, our distinctive management method underpins our cohesion and drives our development. Our model is built on decentralised organisations, autonomous business units and empowered managers. The inviolable principles of fairness and transparency underpin the trust we place in our managers. Our model fosters individual performance within a clearly defined set of rules. We encourage employee initiative and network our teams and expertise to promote cross-business operations and a projectbased approach. Our management model empowers all our employees and focuses on human intelligence rather than systems.

19

business model focuses 5 Our on the long term The VINCI Group was founded in 2000 but the history of its companies and its culture stretches back more than a century. By definition, our concessions and construction businesses have a long-term focus. The infrastructure and facilities we design, build and manage are intended to last. In our concession contracts we undertake to serve regions for periods of several decades. Under these contracts, we invest (directly and indirectly, in France and other countries) very substantial amounts of money – about €2 billion in 2012 – to build new facilities and infrastructure and upgrade existing ones. This is our understanding of our position as a private-sector company serving the public interest.

are proficient at working 6 We in partnerships Because our projects involve a wide variety of stakeholders within our industry, our customers’ sectors and society at large, partnership is part of our culture. This approach is in keeping with the increasing demand for overall solutions in our markets and among our clients, where our ability to integrate solutions also gives us an edge against increasingly strong international competition. In response to changing demand, we are boosting operational synergies among our companies to increase the added value of our projects and maintain our leadership. Meanwhile, with the advent of more diverse, more globalised stakeholders with greater impact on our projects, there is a growing need for open and transparent dialogue with all our partners.

Group is multi-local and 4 Our multi-cultural VINCI consists of more than 2,500 companies operating in some 100 countries. We have stepped up our international expansion in recent years and will continue to do so going forward. We build momentum by making the most of the strong and lasting roots we have put down in the countries where we operate and by recruiting local managers and respecting each country’s culture. As partners in local development, our companies directly and indirectly help create wealth and jobs. They contribute to economic and social solidarity in the areas where they operate.

(*) These pages make up the first section of the VINCI Sustainable Development Report. The second part (p. 138-168) provides a comprehensive overview of the Group’s workforce-related, social and environmental data in accordance with applicable legislation.

20

Group Sustainable development

The commitments of the new Manifesto, with more universal application and content, set out the convictions and principles that underpin VINCI’s approach to corporate responsibility and partnership.

OUR organisation Group’s grassroots 1 The network VINCI’s sustainable development policy is overseen by the Executive Committee and implemented by the Delegation for Sustainable Development, a streamlined structure that works in close coordination with the Group’s functional and operational departments and with a wide range of outside stakeholders. The policy is implemented under the supervision of an international Sustainable Development Committee, which has about 30 members and is responsible for defining the objectives and drawing up the major programmes. Other entities – clubs, working groups and theme-based coordinating units – round out the system.

2 Company self-assessment A sustainable development policy can only be effective if the operating entities apply it in their business activity. Taking inspiration from the ISO 26000 standard, VINCI developed Advance, a sustainable development self-diagnosis software tool, and began rolling it out in France and abroad in 2012. The tool, based on a digital platform and available in several languages, covers 15 priority labour, social and environmental categories. Each company can adapt it to its own operating environment and use it to track progress, prioritise objectives and develop relevant action plans. Trained coordinators within the companies support the programme and follow up the action plans.

rating 3 Non-financial and relations with socially responsible investors Over the past 10 years, VINCI has provided answers to the questionnaires submitted by non-financial rating agencies, notably Vigeo for the ASPI Eurozone® index and SAM for the DJSI. VINCI’s overall rating in the latter remained stable at 70/100 in 2012. The Group maintains its goal of achieving a social dimension score of 75/100 within three years. VINCI also has direct relations with socially responsible investors (SRI), who can base their assessments on in-depth discussions carried out in full transparency. VINCI joined the UN Global Compact in 2003. The Compact’s 10 principles provide

documents frame 4 Reference our approach

an international, neutral and recognised framework for programme implementation. VINCI is also very active within sustainable development networks such as Committee 21, the French association of companies for the environment, and the Corporate Social Responsibility Observatory.

VINCI’s Code of Ethics and Conduct formally sets out the rules of conduct that all employees are required to follow. The Manifesto (shown above) formulates the Group’s commitments to its employees, customers, partners and other stakeholders and sets out the convictions and principles that underpin its sustainable development programme. The Manifesto is explained in detail in the following pages.

VINCI 2012 Annual Report

Group Sustainable development

21

COMMitMENT No. 1

together DESIGN AND BUILD

We commit to promoting outreach and consultation in conducting our projects to ensure that our partners are closely involved.

1 FOCUS In most of our markets, our customers are calling for increasingly comprehensive and complex projects. In response to this demand, we not only work for our customers but also with them and their partners to jointly devise the integrated solutions they need. In an environment in which public acceptance is crucial to the success of infrastructure and public facility projects, VINCI’s ability to organise collective project governance covering all stakeholders – including elected officials, government departments, businesses, civic associations, users and local communities – has become a key strength.

2 action

Progress

We have put this partnership approach into practice on a number of projects, notably major operations for which VINCI has overall responsibility (from financing to design, construction and operation). Such projects include road, airport and rail infrastructure and large public facilities built and managed under public-private partnerships. With clients increasingly including stakeholder relations in their project and worksite specifications, this approach is now being taken by individual companies. To draw attention to the programme and facilitate its adoption by employees, VINCI has given the approach a name: “Together”.

2012 highlights

Partnership for leadership. The 2012 convention of senior VINCI managers bore the title “Partnership for Leadership” and focused on the need to work together ever more closely with the many partners of the Group’s projects. Participants scrutinised successes and failures to better understand stakeholder expectations and take on board best practices for engaging in dialogue and building long-term relationships with customers, local and regional stakeholders and end-users. In-depth presentations described significant projects currently under way (notably the Grand Ouest airport, the SEA Tours–Bordeaux high-speed rail line and structural renovation of occupied buildings, in France; and the first section of the Moscow– St Petersburg motorway in Russia).

A stakeholder mapping tool. VINCI has developed the intranet-based Reflex software tool to help operational managers accommodate and integrate stakeholder expectations in the very early stages of their projects. The tool asks a series of questions that enable the managers to map stakeholders and their objectives and to draw up an action plan to meet each stakeholder’s expectations. It was made available on the VINCI intranet in the first quarter of 2013. Subcontractor relations guidelines. Through their own activity and the activity they subcontract to their partners, VINCI companies are major contributors to regional development. VINCI and its subsidiaries strive to build and sustain working relationships based on respect and fairness with their subcontractors and suppliers. These relations are set out in a set of guidelines drawn up in 2012 and disseminated in 2013, which list the clear-cut principles governing relations with all outside companies (subcontractors and suppliers) at all stages of their work with the Group’s companies (programme management, project management, general contracting). The guidelines extend and supplement the practices already covered by framework agreements, notably those with temporary employment agencies, and include workforce-related responsibility criteria such as health and safety, training and equal opportunities.

Outlook

The intention is to apply the stakeholder dialogue approach to projects of all sizes and to implement it systematically outside France after adapting it to local realities. An effort will also be made to adapt it to the wide variety of stakeholders using local and global dialogue tools similar to the local consultation model long applied by VINCI companies in the areas surrounding their worksites. For this purpose, VINCI is developing a collaborative platform for initiating and managing dialogue concerning its projects and issues relating to its business activities.

Group Sustainable development

22

COMMitMENT No. 2

together

COMPLY WitH ETHICAL PRINCIPLES

We commit to ensuring total transparency in our own practices and in those of our subcontractors.

1 FOCUS We work in some 100 countries around the world under a very large number of contracts and with a workforce of nearly 193,000, with a large number of new employees joining us every year. Because ethical standards underpin these contracts and form the bedrock of mutual trust between our customers and us, it is essential that our employees share and apply rules that ensure compliance with these standards across the board. Moreover, as a major player in the sector we have a duty to constantly raise the level of ethical standards and transparency beyond the requirements set out in legislation.

2 ACTION

Progress

Code of Ethics and Conduct. In a decentralised group that hires several thousand new employees every year, it was important to formally set out the rules of conduct that apply to all our companies and all our employees. This is the purpose of the Code of Ethics and Conduct published by VINCI in 2010. It has been circulated to more than 6,500 managers and is available on the Group’s intranet, where all employees can consult and download it. The rules it contains are not new. They are regularly included in the general guidelines sent to the heads of VINCI’s business lines. Each business line has taken steps to ensure compliance by means of a system of internal controls. These rules are circulated to all levels of management in the operating entities, and in particular to each new manager taking up his or her duties. The Code of Ethics and Conduct spells out these rules for all our employees and for all our outside partners. The VINCI Executive Committee has approved them. Ethics Officer. VINCI has also appointed an Ethics Officer to work with the operational and functional departments to ensure that the code is understood and taken on board. Any employee who encounters difficulties or has questions about the scope and implementation of these rules may consult the Ethics Officer directly and confidentially.

2012 highlights

By the end of 2012, two years after the Code of Ethics and Conduct was introduced, nearly 95% of our employees had signed up to it. The objective is to reach 100%. Cases are regularly submitted to the Ethics Officer, who handles them all in accordance with clear and explicit procedures regarding confidentiality, inquiry and internal and, if need be external, investigation. Meanwhile, internal audit resources and comprehensive audit plans govern the overall system. If necessary, an external third party can be brought in to strengthen the coordinated activities of the Ethics Officer and internal audit staff. Each Group division has set up ethics training modules for exposed employees. The Ethics and Compliance Club, which brings together the Group’s legal affairs directors and the Ethics Officer, continued its work. Its remit is to foster exchanges of best practices in the field of ethics, to perform a legislative and regulatory watch, and to review cases. A number of VINCI companies operating in sectors in which specific ethics procedures apply have appointed their own specialised compliance officers.

Outlook

Together with other large companies, trade associations and the Transparency International organisation, VINCI participates in the work of the OECD on combating bribery in business transactions. A Transparency International study of the practices of the world’s largest companies reviewed VINCI’s activities and methods and identified the following scope for improvement: circulation of the Code of Ethics and Conduct, regular updates to it and ethics training reporting. With regard to human rights, the Advance sustainable development self-diagnosis programme highlighted the need to formally set out a human rights policy. Work undertaken in 2013 will above all be aimed at producing a practical guide.

VINCI 2012 Annual Report

Group Sustainable development

23

COMMitMENT No. 3

together PROMOTE GREEN GROWTH

We commit to reducing our greenhouse gas emissions by 30% between now and 2020, to supporting our customers in their quest for better energy efficiency and to encouraging their adoption of an environmentally responsible approach.

1 FOCUS Our business activities are closely related to the challenges of green growth and as a global major we have special responsibility to respond to them. In all the countries where we operate, our companies strive to reduce the impact of their activities by meeting the highest environmental standards.

2 ACTION

Progress

In both their works and their operations activities, VINCI companies have introduced action plans aimed at limiting the consumption of natural resources and at recovering and recycling waste whenever and wherever possible. The Advance sustainable development self-diagnosis questionnaire provides entities with guidance in assessing their environmental impact and identifying avenues for improvement. Ten years ago VINCI introduced an environmental reporting system that now covers virtually all its revenue. Since 2007, the statutory auditors have issued an annual report on a selection of indicators drawn from this reporting system (see p. 177). VINCI companies employ environmental management systems (primarily patterned on the ISO 14001 standard) that now cover half the Group’s revenue. VINCI has been measuring its greenhouse gas emissions according to the ISO 14064 standard across its worldwide scope since 2007. For several years, VINCI has been working with the scientific community to develop eco-design tools for structures and infrastructure that incorporate life cycle analysis (LCA). Adapted to major projects (particularly transport infrastructure), the tools can be used to assess the environmental footprint of each part of a project and its alternative solutions, and thus help guide design choices in conjunction with the client. In France, VINCI has developed the Oxygen eco-commitment programme for the building sector. It includes energy and environmental performance commitments at all stages of a project (design, construction, utilisation).

2012 highlights

Including its new subsidiaries, VINCI’s greenhouse gas emissions (Scopes 1 and 2) amounted to 62 tonnes of CO2 per million euros of revenue in 2012. This constitutes a 13% fall from 2009, the first year in which emissions were measured. In the annual Carbon Disclosure Project (CDP) review, VINCI obtained a score of 80/C, up five points from 2011. In France, the national biodiversity strategy (SNB) committee recognised VINCI for its voluntary commitment to biodiversity. The purpose of SNB recognition is to mobilise public- and private-sector players in a 20122015 action plan. The Group’s main initiatives were the creation of the LISEA Biodiversity Foundation; the deployment of a biodiversity plan in Eurovia quarries (see p. 87); and continuation of the green motorway package aimed at environmentally upgrading VINCI Autoroutes motorways (see p. 45). Entrepose Contracting (VINCI Construction), which is building a 450 km pipeline in Papua New Guinea, supported the “Our Planet Reviewed” scientific expedition carried out in the Coral Triangle, the area in the Pacific Ocean that harbours the world’s greatest marine biodiversity. A rail infrastructure module was added to the CO2NCERNED carbon footprint tool. Eco-design studies were carried out for 229 projects; 18 projects were carried out under the Oxygen eco-commitment.

Outlook

To achieve its objective of reducing GHG emissions 30% between now and 2020, the Group’s companies are working with their customers, suppliers, subcontractors and the final infrastructure users to identify, quantify and define avenues for improvement. The Group’s companies will also be stepping up their efforts to achieve environmental certification, train employees (with a particular focus on worksite biodiversity conservation) and include environmental criteria in their contracts. To support work on the energy transition, they will continue to develop design methods, construction techniques and service offerings that reduce energy and resource consumption and guarantee consumption levels throughout the life cycle of buildings and infrastructure.

Group Sustainable development

24

COMMitMENT No.4

together

ENGAGE IN CIVIC PROJECTS

We commit to supporting the civic engagement of our employees, especially through the Group’s foundations around the world.

1 FOCUS VINCI defines itself as a private-sector company working closely with local and regional authorities to serve the public interest. This positioning reflects the Group’s commitment to its role as a long-term partner of the cities and communities for which it builds and manages facilities. The Group’s approach to partnership includes its civic engagement programme focused on skills volunteering, which offers the Group’s employees and companies opportunities to use their skills outside work to benefit civil society.

2 ACTION

Progress

Our sponsorship and civic engagement work focuses on three main issues: social integration, environment (see p. 23) and culture. We systematically involve our employees and companies in our skills sponsorship projects. In 2012, funding of more than €10 million was provided for work in the three areas. The Fondation VINCI pour la Cité, a pioneer in civic engagement with groups working to combat social exclusion, celebrated its tenth anniversary in 2012. Since its inception in 2002, it has supported a total of 1,200 projects with assistance from 1,500 sponsors and funding amounting to nearly €20 million. Foundations similar to the Fondation VINCI in France have been set up in the Czech Republic, Germany and Greece. The Fondation VINCI also heads the Cité Solidaire programme in underprivileged neighbourhoods. In Africa, the Issa (Initiatives Sogea-Satom pour l’Afrique) programme, set up in 2007, supports solidarity activities initiated by the agencies and teams of Sogea-Satom (VINCI Construction). Projects include the construction of healthcare and educational facilities and the creation of microenterprises that generate work and jobs for local populations. The Group’s subsidiaries undertake a large number of local activities in France and abroad. In Cambodia, Cambodia Airports (VINCI Airports) has established a long-term partnership with the Artisans d’Angkor association, which is breathing new life into ancestral Khmer crafts while providing a livelihood for about 5,000 families in the Angkor temples region.

VINCI Autoroutes set up the VINCI Autoroutes Foundation for Responsible Driving in 2011. The foundation uses its €2 million annual budget to support research programmes, civic association initiatives and projects designed to raise public awareness of road safety issues.

2012 highlights

During the year, the Fondation VINCI supported 165 projects involving 242 sponsorships and €2.6 million in funding. It extended the Cité Solidaire programme to four additional cities: Grenoble, Le Havre, Rennes and Champigny sur Marne. Two further foundations were set up, in Belgium and Slovakia. The Issa programme supported 27 projects and provided funding amounting to €440,000. In addition to its partnership with Artisans d’Angkor, Cambodia Airports supported an archaeological excavation project carried out by Inrap at the site of the Siem Reap airport near the Angkor temples. On the SEA Tours–Bordeaux HSL project, the Sillon Solidaire fund was set up at the initiative of construction joint venture COSEA working with the Fondation VINCI and later joined by concession company LISEA. With an annual budget of €310,000, it has supported 31 non-profit organisations combating social exclusion in the regions along the alignment with the help of 35 employee sponsors. The VINCI Autoroutes Foundation issued an appeal to its employees to sponsor civic initiatives. Funding amounting to €70,000 was provided for the 11 projects selected, which mainly focused on raising awareness among young people and children, preventing risky driving behaviour, training, and support for responsible mobility.

Outlook

The Group’s goal is to step up the skills sponsorship and social sponsorship momentum undertaken by the Fondation VINCI pour la Cité in France and to expand it internationally. VINCI is also considering the creation of a social incubator to sponsor initiatives taken by its employees or companies wishing to develop socially beneficial projects. The main focus will be on fostering work integration in the regions and making their technical expertise available in post-emergency and reconstruction situations (e.g. work on infrastructure damaged by natural disasters).

VINCI 2012 Annual Report

Group Sustainable development

25

COMMitMENT No. 5

together

STRIVE FOR ZERO ACCIDENTS

1 FOCUS The safety of our employees, partners and subcontractors is an absolute priority. Our managers are responsible for ensuring the physical integrity and the health of everyone on all our sites.

2 We reject the idea that workplace accidents are unavoidable and we commit to the zero accidents objective.

ACTION

Progress

Each Group business line has gradually developed its own workplace health and safety system tailored to its particular business activities. Networks of occupational health and safety specialists operate around the world as part of a Heath and Safety Coordination system headed by a member of the VINCI Executive Committee, who reports on its work to the VINCI Board of Directors. To mark the commitment of top management, every fatality is reported to the chairman and CEO and the members of the Executive Committee by the management concerned. Locally, every manager receives training in safety and is responsible for it. Safety results are one of the criteria used to assess individual managers’ performance. At operational level, health and safety policies are implemented in a variety of ways: awareness-raising programmes covering all employees of a company; 15-minute safety sessions for employees, subcontractors and temporary staff on worksites; health and safety challenges; and special training courses for use by worksites employing diverse nationalities.

2012 highlights

63% of VINCI companies recorded no lost-time accidents in 2012. The accident frequency rate for the Group as a whole has fallen from 11.14 to 8.60 over the past five years. VINCI Construction conducted a safety management training course in 2012 for 500 senior executives around the world. The course will be extended to middle-level managers – a total of 2,000 people – in 2013. VINCI Energies has launched a similar programme, creating training modules tailored to each level of responsibility, from director to worksite manager. To prevent severe accidents, early efforts are needed to detect dangerous situations, understand behaviour and adopt the best practices of the groups that have made the

most progress. Eurovia, working with Dupont de Nemours, rolled out a near-miss analysis programme in its operating entities in 2012. VINCI Autoroutes launched the “Sécurité 100% Chantiers” worksite safety programme aimed at achieving zero accidents on projects for which the company serves as programme manager and in its operating activities. VINCI Autoroutes is also working to change behaviour and enhance knowledge of road risks through the VINCI Autoroutes Foundation for Responsible Driving (see p. 46). VINCI Construction France held the first “Safety Basics” training sessions in its in-house Cesame training centre network. It will be systematically given to newly hired employees at all levels within three months of their recruitment.

Outlook

The single objective remains zero accidents. Beyond complying with legislation, we must step up the proactive programmes already undertaken. Implementation of a safety management policy in which supervisory staff play a major role will help us to review our many accident prevention activities to identify best practices and share them, notably through the VINCI Innovation Awards Competition. Progress can also be made by increasing the involvement of employee representatives in the Group’s health and safety programme and by boosting our partner and subcontractor requirements, in particular by including safety clauses in our contracts with them. VINCI does not intend to limit its commitment to safety. We are also committed to occupational health and are working with scientists and ergonomics specialists to increase our understanding of occupational risks and workplace quality of life. VINCI will also continue its efforts to raise awareness among infrastructure users, in conjunction with the authorities responsible for safety.

Group Sustainable development

26

COMMitMENT No. 6

together

FOSTER EQUALitY AND DIVERSitY

We commit to diversifying our supervisory staff to include more women and people of diverse origins.

1 FOCUS The wide variety of backgrounds and broad range of experience of our employees is an integral part of our culture. Our companies strive to ensure that their workforce reflects the diversity of the host societies in the countries where they operate. In keeping with this approach, we pursue a proactive diversity policy to combat all forms of discrimination in hiring and in labour relations – particularly discrimination against women, disabled people, older people and people of all backgrounds. In this way, we strive to create a working environment in which all employees, in all their diversity, are given an opportunity to make the most of their abilities and help the company achieve its goals.

2 ACTION

Progress

In 2004, VINCI introduced a policy of proactively combating all forms of discrimination in hiring and labour relations. The programme was formally drawn up by an Equal Opportunity Committee and then debated by top management at their annual convention. Diversity has since been recognised as a performance driver and a strategic asset. In VINCI’s first Manifesto, covering its workforce-related and social commitments and published in 2006, the Group made a commitment to bring in an independent auditing organisation to assess its equality policy. A system was set up with the support of Vigeo and further implemented by in-house auditors. Over a period of five years, more than 120 audits were carried out. They provided input for improvement programmes within each audited entity and an opportunity to share best practices across the Group. These are summed up in the diversity action guide. A 75-member network of diversity champions set up in 2011 within the Group’s business lines and companies facilitates the dissemination of this policy. The Trajeo’h non-profit organisation fosters redeployment and retention of Group employees unfit for duties after an accident or work-related illness and the recruitment of disabled people. In addition to the Rhône-Alpes region, it has extended its activity to the Greater Paris, Auvergne, Burgundy, Franche Comté and Provence-Alpes-Côte d’Azur regions.

2012 highlights

Between 2006 and 2012, the number of women in the workforce increased from 18,800 to 25,903. People over the age of 50 accounted for 11% of the employees hired in permanent jobs in 2012. Disabled employees numbered 3,980 at the end of 2012. Work awarded to businesses employing a majority of disabled workers amounted to €5.5 million for the year. VINCI held a Group-wide “Diversity: Past experience and future prospects at VINCI” meeting in April that brought together more than 200 managers and human resources executives. In 2012, Trajeo’h supported 173 preliminary disability assessments, redeployed 92 disabled employees and opened a new agency in the Upper Normandy region. Initiatives taken to improve the Group’s gender mix included: – “Capital Filles”, in which young female high-school students are given an opportunity to explore jobs that have traditionally been held by men and the outlook for these jobs in the future. Sixty-five Group mentors composed exclusively of women helped the school students make their educational choices; – “Les Ambassadrices”: 24 women employees at VINCI meet with students of both genders to talk about their experience and career paths. These discussions provide an opportunity to challenge a large number of preconceived ideas about gender; – the Equality Laboratory, in which VINCI works to shed light on stereotypes by analysing preconceived ideas in the workplace, the education system and the media.

Outlook

VINCI is continuing its proactive effort to improve its gender mix, focusing on three issues: the Group’s appeal to women, recruitment methods and career development opportunities. The goal is to increase the proportion of women in managerial roles to 20% by 2015. Awareness raising and better gender mix will foster diversity in managerial practice. As it expands internationally, VINCI will work to increase the number of locally recruited supervisory staff members and to promote managers from all backgrounds and all communities. Lastly, the effort to redeploy and retain employees who become unable to perform their current jobs will continue, with Trajeo’h rolled out throughout France.

VINCI 2012 Annual Report

Group Sustainable development

27

COMMitMENT No. 7

together

PROMOTE SUSTAINABLE CAREERS

We commit to proposing training and job mobility opportunities for all our employees in order to promote sustainable employability.

1 FOCUS Because in our business activities and in our culture our teams are crucial to the success of our projects, and because our work is labour and management intensive, we give preference to creating permanent jobs and to offering career paths that enable all employees to fully develop their initiative and thereby make the most of their abilities and help the company achieve its goals.

2 ACTION

Progress

Our human resources policy is geared to offering every employee a career path leading to promotion within the company. In every business line, in-house training centres (for which resources have been substantially increased over the years) develop programmes to reskill employees as business activities change and disseminate a common technical and managerial culture within each of our companies. In France, collective agreements on the workforce planning system signed in recent years support the approach. Promotion is encouraged by a management culture that stresses empowerment and rewards initiative. A skilled worker can, for example, rapidly become a crew leader and then a foreman. Upward mobility is based on merit rather than educational background, enabling the most effective employees to reach top management positions within the Group.

2012 highlights

In 2012, the proportion of permanent jobs within VINCI was 88%. Over the past five years, the Group’s overall workforce has increased more than 21% to 192,701 employees at 31 December 2012. More than 3 million hours of training were conducted. VINCI is recognised as an attractive employer by the audiences that are the focus of its recruitment efforts. In the 2012 Universum classification, based on a survey of 31,000 students at France’s top engineering schools, VINCI placed among the top 10 ideal employers. A new VINCI subsidiary, ViE, supports Group companies’ workforce development programmes. In 2012, its first full year of activity, ViE was involved in meeting

integration commitments on 87 worksites representing a total of 1.35 million hours of work, and it directly supported 712 people enrolled in integration programmes. The Skillup programme, a worksite school using visual and hands-on methods, is designed to develop the knowledge and skills of execution and supervisory personnel. Three new VINCI Construction Grands Projets worksites – in Turkmenistan, Malaysia and Chile – introduced the programme in 2012, training a total of 343 people. To support changes in its business activities, VINCI Autoroutes introduced training courses that enable employees to acquire new skills and move into different jobs or to different regions. Overall, more than 500 employees, mainly from the tolls sector, have changed jobs since 2008, 94 of them in 2012. The VINCI Academy programme introduced two new courses for managers in 2012: the “VINCI Executive Programme”, designed to foster synergies between the various Group business activities and to speed the Group’s internationalisation process; and the “HR by VINCI” programme, which enhances the skills of HR managers with a view to stepping up cross-business activities.

Outlook

The human resources departments help the Group tackle two major challenges: the growing internationalisation of its activities and the development of cross-business activities, at a time when the demand for comprehensive and complex projects is increasing in its markets. VINCI will continue to deploy new management tools, with a focus on job classification and information systems.

Group Sustainable development

28

COMMitMENT No. 8

together

SHARE THE BENEFitS OF OUR PERFORMANCE

We commit to ensuring that every VINCI employee is given an opportunity, wherever possible, to share in our economic success.

1 FOCUS VINCI’s economic performance must benefit its shareholders and its employees alike. Alongside profit-sharing and incentive plans, the Group savings plans enable VINCI’s employees to share in VINCI’s success, in keeping with the Group’s values summed up in its motto: “Real success is the success you share.”

2 ACTION

Progress

In 1995, VINCI set up an employee savings plan, Castor, initially available to French employees. From its inception, this plan (in its various versions) offered employer contributions designed to encourage savings by the lowest-paid employees and thus enable a very broad range of employees to share in the success of the Group. The savings plan was subsequently rolled out internationally, with adjustments to comply with the regulatory procedures of each country concerned. The savings plan, boosted by confidence in the growth and future success of the Group and by the exceptional increase in the VINCI share price throughout the first decade of this century, attracted large numbers of employees over the years. VINCI’s employees collectively became the Group’s largest shareholder, helping to stabilise its shareholder structure. A representative of the employee shareholders chairs the supervisory board of the company mutual funds (Castor and other employee shareholder funds) and sits on the VINCI Board of Directors. In addition to the savings plans, VINCI enables employees to share the perform­ ance of their company through systems that are tailored to the context and the legislation of each country. In France, this is reflected in the growth of profit-sharing and incentive plans.

2012 highlights

At the end of 2012, 112,000 employees, i.e. nearly 60% of the total workforce, were VINCI shareholders via the Group’s employee savings plans, with an average portfolio of €17,000 per employee. The Group’s employees collectively held 9.9% of its share capital. Employer contributions amounting to €97.3 million were paid during the year. Outside France, a special employee shareholding plan was made available in 2011-2012 to an additional 45,000 employees in 14 countries (Belgium, Canada, Czech Republic, Germany, Morocco, Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Switzerland, United Kingdom, United States). Participation came in at nearly 25%. The VINCI Employee Shareholders’ Circle, set up in 2011, had 10,800 members at the end of 2012 (see p. 143). At Group level, payroll expenses amounted to €6 billion, i.e. 15% of revenue. Profit sharing, incentive, employer contribution and social benefit payments amounted to €306.4 million. In France, 92% of employees benefited from incentive plans and/or profit-sharing agreements, in addition to a profit-sharing bonus of €367 gross per employee.

Outlook

Despite the wide variety of legal and tax systems in the countries concerned, the employee savings plan will be extended to five additional countries in 2013: Austria, Brazil, Chile, Indonesia and Luxembourg. Following this operation, 80% of the Group’s employees will have access to the employee savings plan. At the same time, VINCI will continue to implement its profit-sharing model via the various instruments of its remuneration and social benefits policy.

VINCI 2012 Annual Report

Group Sustainable development

29

INNOVATING FOR THE FUTURE

RESEARCH AND DEVELOPMENT With a €47 million budget in 2012 (up 57% in five years) and research teams totalling 249 people (full-time equivalent), VINCI is a sector leader in research and development. In 2012, the Group was involved in about 50 research programmes and 12 competitiveness clusters. It patented 41 new inventions, bringing its worldwide active patent portfolio to 1,791. Our research and development policy focuses on issues at the heart of the Group’s business activities: eco-design, energy performance, infrastructure sustainability and new mobility services. It is headed by a committee that brings together the science and technical heads of the various business lines and is tasked with facilitating exchanges of information among the business lines and developing collaborative research projects. Meanwhile, VINCI’s business lines and companies pursue innovation policies focused on their markets and on optimising the solutions they offer their customers, covering design methods, construction techniques and exclusive products and processes, such as those developed by Eurovia in the roadworks industry and by Soletanche Freyssinet in specialised civil engineering businesses.

PARTICIPATORY INNOVATION In keeping with its decentralised management model, VINCI develops its innovation potential by encouraging hands-on grassroots initiatives and by organising the biennial VINCI Innovation Awards Competition, which is open to all employees. The competition covers not only technologies but also the full range of innovations that drive progress within the Group, notably in the fields of safety, sustainable development and working conditions. In the most recent competition, held in 2011, 5,100 employees entered 1,717 projects, with prizes going to 113 entries in the series of regional awards and 17 entries in the Group awards. A Dissemination Working Group was set up to speed the spread of these innovations throughout the Group. A call for entries in the 2013 competition was issued at the end of 2012.

COLLABORATIVE RESEARCH ON ECO-DESIGN AND THE SUSTAINABLE CitY The Eco-design of Buildings and Infrastructure Chair set up by VINCI and ParisTech in 2008 and endowed with a budget of €3 million over a period of five years, continued its research work involving about 20 programmes that are primarily focused on the environmental quality of buildings and neighbourhoods, energy management strategies for buildings and the environmental impact of transport systems. In 2012, this work produced tools for urban biodiversity assessment, urban parking eco-design and building ecorehabilitation. VINCI and ParisTech also organised the Chair’s first seminar and several meetings focused on specific topics that brought together teachers, VINCI employees and outside partners (www.chaire-eco-conception.org). The Fabrique de la Cité (the City Factory) , a think tank set up at VINCI’s initiative, continued its work, which brings together a wide range of stakeholders involved in urban development and mobility issues. The main topics addressed in 2012 were public acceptance, the role of cities in the energy transition, urban infrastructure financing, and real-time data capture and analysis to improve urban mobility (www.lafabriquedelacite.com). The Cities and Regions Club, which brings together VINCI research and operational staff, mainly focused on working with representatives of the French Ministry for Ecology to analyse the winning projects of the EcoQuartiers France competition. The partnership initiated the previous year with the Institute for Sustainable Development and International Relations (Iddri) published its first work on measuring the overall value of a project by looking at its positive and negative impacts on urban development. Lastly, VINCI Concessions renewed its support for another three years of the Chair of Public-Private Partnerships at the University of Paris 1-Sorbonne.

5 30

4

Group

2012

45

4

Stock market and shareholder base

3

40

3

2

2

1

35

1

Return on investment in VINCI shares over 10 years

A stable dividend

€4,044

0

0 Janvier Février Mars Avril Mai Juin Juillet A VINCI shareholder who invested €1,000 on 1 January 2003 andJan vier + Fé vri 1 5  % er reinvested all the dividends received would have an investment 2012 a year of €4,044 on 31 December 2012. This represents an annual return of 15%.

Août

Mars

Septembre Octobre Novembre Décembre The dividend proposed to the General Meeting of 16 April AvrilShareholders’ ai 2013 inM respect of 2012 share, Juin is €1.77 Juilleper t Août the same as that for 2011.

2012

30

Septembre Oc tob

€1,000

Jan. 2003 Dec. 2012

  

€1.62 €1.62 €1.67

€1.77 €1.77

Shareholder base (*) Employees (savings plans) Individual shareholders Treasury shares Qatari Diar Real Estate Investment Company Financière Pinault Institutional investors – France Institutional investors – other

9.9 % 10.9 % 7.1 % 5.5 % 1.4 % 17.6 % 47.6 %

(*) Estimate based on a schedule of identifiable bearer shares at the end of 2012 and a shareholder survey.

2008

Dividend: €1.77 per share

VINCI share recovery in 2012

Following a sharp fall in stock markets in 2011, the VINCI share closed 2012 at €35.96, up 6.5% over a year. Our share’s return to growth was less pronounced than that of the CAC 40, which rose 15.2% over the same period and posted its best performance since 2009. At the end of December 2012, we ranked 17th in the CAC 40 with a market capitalisation of almost €21 billion.

Growth of more than 150% over 10 years

Between 1 January 2003 and 31 December 2012, our share price increased 168% while the CAC 40 recorded 20% growth over the same period. A VINCI shareholder who invested €1,000 on 1 January 2003 and reinvested all the dividends received would now have an investment of €4,044, representing an average annual return of 15%. During the same period, our market capitalisation was multiplied by more than 4.5.

In 2006, the year VINCI acquired ASF, we introduced a dividend policy consisting of distributing 50% of consolidated net income. In application of that policy, the Board of Directors at its meeting on 5 February 2013 decided to propose to the Shareholders’ General Meeting of 16 April 2013 a dividend of €1.77 per share, stable relative to the previous year and representing a return of 5% on the share price at 31 December 2012. After deducting the interim dividend of €0.55 paid on 15 November 2012, the final dividend to be paid on 22 May 2013 would be €1.22 per share.

A stable and diversified shareholder base

At 31 December 2012, 66.5% of our share capital was held by more than 500 investment funds, located mainly in France, the rest of Europe and North America. At the same date, Qatari Diar Real Estate Investment Company, which became a VINCI shareholder in 2010, held a 5.5% interest. Employee savings funds, which group together some 110,000 employees, owned 9.9% of our share capital, making them VINCI’s biggest shareholder block. Lastly, 260,000 individual shareholders accounted for 10.9% of our share capital at 31 December 2012.

2009

2010

2011

2012

Individual shareholders Close relations and discussion

Yves-Thibault de Silguy, vice-chairman and senior director of the Board, continued his efforts to meet individual shareholders, hosting meetings in Toulouse, Caen, Reims and Nice in 2012. For the 13th consecutive year, we had a stand at the Actionaria investment fair, which was held in Paris on 23 and 24 November 2012. On that occasion, Group representatives informed visitors about VINCI’s news and strategy. In addition to presenting our Shareholders’ Club programme and the benefits of being a member, they distributed a questionnaire with the aim of gaining a better understanding of shareholders’ expectations.

A varied programme of events In addition to the Shareholders’ General Meeting and our presence at Actionaria, a total of 22 events were proposed to Group shareholders in 2012. Some 4,500 of them participated in the events, which included meetings with the Fondation VINCI pour la Cité and several visits to the Stade de France.

Group Stock market and shareholder base

VINCI 2012 Annual Report

31

Share performance and average daily trading volume Market capitalisation at 31 December 2012: €20.7 billion based on a price of €35.96 per share, ranking VINCI 17th in the CAC 40 by capitalisation and 15th by index weight. Between 31 December 2011 and 31 December 2012, the VINCI share price increased 6.5% while the CAC 40, Euro Stoxx 50 and Euro Stoxx 600 Construction & Materials increased 15.2%, 13.8% and 15.4% respectively. In 2012, a daily average of 3 million shares was traded on the market (Euronext + MTFs). Number of shares traded 6 (million/day)

VINCI CAC 40 rebased Euro Stoxx 50 rebased Euro Stoxx 600 Construction & Materials rebased VINCI shares traded

5

Price in50€ (VINCI rebased)

45

4 3

40

2

€35.96 (+6.5%)

35

1 0

January

February

March

April

May

June

July

August

September

October November December

30

2012

Another successful year for “Rediscover your city”

VINCI website and shareholder publications

In 2011, VINCI launched a new shareholder visit concept named “Rediscover your city”, which emphasises the role played by Group companies in the development of major French urban areas. In 2012, 14 cruises were organised for almost 1,600 shareholders in Paris, Bordeaux, Lyon and, for the first time, Marseille. Our Shareholders’ Club had 20,273 members at 31 December 2012, a 4% increase on the previous year.

Institutional investors and financial analysts In 2012, our senior management participated in over 100 events, establishing around 800 contacts with almost 400 institutional investors and the financial analysts who cover our share. In addition to meetings and conference calls set up for the publication of our results, we organised road shows totalling 25 days in Europe and North America. We also participated in nine conferences organised by major financial institutions, mainly in Paris and London.

Our website features special pages for individual and institutional investors under the “Shareholders” and “Finance” tabs. Shareholders have access to a suite of publications (in French only) in either printed or electronic form under the “Shareholders” tab. www.vinci.com

In addition, conference calls and one-on-one meetings took place throughout the year at VINCI’s head office. These initiatives enable our management to maintain total transparency and communicate regularly with the financial community about the Group’s news, performance, growth strategy and corporate governance. In July 2012, VINCI organised a sectorspecific presentation on Soletanche Freyssinet (VINCI Construction) for institutional investors and sell-side financial analysts covering our share.

VINCI Shareholder Relations Department 1 cours Ferdinand de Lesseps 92581 Rueil Malmaison Cedex, France Individual shareholders in France Tel: 0 800 015 025 (free-phone from a fixed line) Institutional shareholders outside France Tel: +33 1 47 16 45 07 / 33 46

Concessions 32

Business activity

VINCI Autoroutes VINCI Concessions With a 4,385 km network, VINCI Autoroutes operates half of France’s motorways under concession. VINCI Concessions develops and operates a unique portfolio of transport infrastructure and public facility concessions in some 20 countries. Page 36

Page 50

Revenue (1) (in €m)

33

Business activity

VINCI 2012 Annual Report

Operating income from ordinary activities (2) (in €m and as a% of revenue (1))

Net income attributable to owners of the parent (2)

Cash flow from operations (3)

(in €m and as a% of revenue (1))

(in €m and as a% of revenue (1))

5,297

2011

5,354

2012

2,149

2,159

852

886

3,366

3,372

40.6%

40.3%

16.1%

16.6%

63.6%

63.0%

2011

2012

2011

2012

2011

2012

Revenue by geographical area (1) (as a percentage)

France Europe Rest of the world

94% 3% 3%

(1) Excluding concession subsidiaries’ works revenue. (2) Including ASF Holding and Cofiroute Holding. (3) Before tax and financing costs. (4) At 31 December.

Net financial debt (2) (4) (in €m)

18,895

18,058

2011

2012

34

Infrastructure

Business activity Concessions

VINCI’s concessions worldwide Country

Share capital End of held contract

ASF network (excl. Puymorens tunnel, 5 km) 2,709 km Cofiroute network (excl. A86 Duplex tunnel, 11 km) 1,100 km Escota network 459 km Arcour (A19) 101 km Openly, Lyon 10 km R1 (PR1BINA) expressway 52 km A-Modell A4 motorway 45 km

France France France France France Slovakia Germany

100% 83% 99% 100% 100% 50% 50%

2033 2031 2027 2070 2013 (1) 2041 2037

A-Modell A5 motorway (2) A-Modell A9 motorway (2) Newport Southern Distributor Road Hounslow district road network Isle of Wight road network Moscow–St Petersburg motorway (2) Athens-Tsakona motorway (2) Maliakos-Kleidi motorway (2) Fredericton-Moncton Highway Trans Jamaican Highway

60 km 46.5 km 10 km 432 km of roadways and 763 km of footpaths 821 km of roadways and 767 km of footpaths 43 km 365 km 240 km 200 km 34 km

Germany Germany United Kingdom United Kingdom United Kingdom Russia Greece Greece Canada Jamaica

50% 50% 50% 50% 50% 39% 30% 14% 25% 13%

2039 2031 2042 2038 2038 2040 2038 2038 2028 2030

Rueil Malmaison–Jouy en Josas/Versailles (11 km) Tunnel in the Pyrenees (5 km) Tunnel in Marseille Tunnel in Marseille Peloponnese–mainland Two bridges in Lisbon Two bridges over the Severn Tunnel in Amsterdam Prince Edward Island–mainland

France France France France Greece Portugal United Kingdom Netherlands Canada

83% 100% 33% 59% 57% 37% 35% 28% 19%

2086 2037 2025 2054 2039 2030 2016 (3) 2037 2032

Underground rail link (16 km) in Antwerp Light rail system (23 km) in Lyon Wireless communication system over 14,000 km of rail lines High-speed rail line (302 km) between Tours and Bordeaux

Belgium France France

37% 35% 30%

2050 2038 2025

France

33%

2061

1.5 million spaces, of which 0.4 million under concession or freehold 60,000 sq. metre building Two secure parking facilities for heavy goods vehicles

World

100%

(4)

France France

100% 100%

2040

Rennes, Dinard Chambéry, Clermont Ferrand, Grenoble, Quimper Nantes Atlantique, Saint Nazaire Montoir Ancenis Phnom Penh, Siem Reap, Sihanoukville

France France

49% 99 %

2025 (1) from 2013 to 2023 (1)

France France Cambodia

85% 100% 70%

2066 2018 (1) 2040 (3)

80,000 seats 25,000 seats 35,000 seats 40,000 seats 10,700 seats

France France France France France France France

67% 100% 50% 50% 50% 100% 100%

2025 (5) 2043 2040 2045 2040 2027 2027

Motorway and road infrastructure

Description Network under concession

Road bridges and tunnels A86 Duplex tunnel Tunnel du Puymorens Prado Carénage tunnel Prado Sud tunnel (2) Charilaos Trikoupis Bridge Tagus bridges Severn Crossings Coentunnel (2) Confederation Bridge Rail infrastructure Liefkenshoek (2) Rhônexpress GSM-Rail (2) SEA HSL (2) Parking facilities VINCI Park Car Rental Center, Nice-Côte d‘Azur Airport Truck Étape Airports France France France France Cambodia Stadiums and public facilities Stade de France Le Mans stadium (MMArena) Nice stadium (Allianz Riviera) (2) Bordeaux stadium (2) Dunkerque arena (2) Public lighting in Rouen (Lucitea) Public lighting in Goussainville (1) Service, management or public service contracts. (2) Under construction or to be built. (3) Estimated date of end of contract.

(4) 26.4 years: average weighted residual term for the current net value of each of the contracts for the 353,000 spaces under concession. (5) See Note H to the consolidated financial statements.

VINCI 2012 Annual Report

Europe

Germany Toll Collect (motorway toll system) 14,000 parking spaces A-Modell A4 motorway A-Modell A5 motorway A-Modell A9 motorway Belgium Liefkenshoek rail link, Antwerp 56,000 parking spaces Spain 65,000 parking spaces France ASF network Cofiroute network Escota network A86 Duplex tunnel Arcour (A19) Openly, Lyon Prado Carénage tunnel Prado Sud tunnel Truck Étape Rhônexpress 450,000 parking spaces Stade de France Le Mans stadium Nice stadium Bordeaux stadium Dunkerque arena 9 airports: Chambéry, Clermont Ferrand, Dinard, Grenoble, Nantes (3), Quimper, Rennes Car Rental Center, Nice-Côte d’Azur Airport GSM-Rail SEA HSL Tours–Bordeaux Public lighting, Goussainville Pubic lighting, Rouen Greece Charilaos Trikoupis Bridge Athens–Tsakona motorway Maliakos–Kleidi motorway Luxembourg 53,000 parking spaces Netherlands Coentunnel Portugal Two bridges over the Tagus Czech Republic 39,000 parking spaces United Kingdom Newport Southern Distributor Road Severn Crossings 122,000 parking spaces Hounslow district road network Isle of Wight road network Russia 900 parking spaces Moscow-St Petersburg motorway Slovakia 3,000 parking spaces R1 (PR1BINA) expressway Switzerland 6,000 parking spaces Turkey

Business activity Concessions VINCI Autoroutes

Rest of the world Cambodia 3 airports Canada Fredericton-Moncton Highway Confederation Bridge 138,000 parking spaces Colombia United States 566,000 parking spaces India Jamaica Trans Jamaican Highway Peru

Rail infrastructure

Airports

Motorway and road infrastructure

Infrastructure projects under study

Parking facilities

Stadiums and other public facilities

35

36

Business activity Concessions

VINCI Autoroutes

VINCI 2012 Annual Report

Business activity Concessions

Profile With a network of 4,385 km under concession, VINCI Autoroutes is Europe’s leading motorway operator. Its four concession operating companies – ASF, Cofiroute, Escota and Arcour – serve the south and west of France, representing half of France’s total motorway network under concession. VINCI Autoroutes’ motorways carry 2.2 million customers a day and have 1.7 million electronic toll subscribers. Drivers cover 46 billion km annually on VINCI Autoroutes motorways, representing almost 800 million toll transactions. VINCI Autoroutes invests massively – €6.5 billion over the last six years – in extending and modernising motorway infrastructure to improve safety and reduce its environmental footprint. This investment creates short-term economic activity while improving mobility and access to the different regions, thereby contributing to their growth. It goes hand in hand with a service-based policy that improves traffic flow and driver comfort and hence safety on the motorway, reinforcing the appeal of VINCI Autoroutes’ networks.

37

38

Business activity Concessions VINCI Autoroutes

39

Business activity Concessions VINCI Autoroutes

VINCI 2012 Annual Report

Traffic

Revenue (1) 2012 (in millions of kilometres travelled)

2012/2011 change on a stable network

28,290

-1.5%

6,636

-1.2%

10,802

-2.4%

267

+0.7%

45,995

-1.7%

ASF Escota Cofiroute Arcour Total

Net income attributable to the owners of the parent (2)

(in €m)

4,409

2011

4,439

(in €m and as a % of revenue (1))

2012

Operating income from ordinary activities

VINCI’s motorway concessions in France

820

827

18.6%

18.6%

2011

2012

Cash flow from operations (3)

(in €m and as a % of revenue (1))

(in €m and as a % of revenue (1))

Angers Orléans Tours

La Roche sur Yon Niort Rochefort

Poitiers

3,058

3,087

45.8%

45.5%

69.4%

69.5%

2011

2012

2011

2012

Paris

Le Mans

Nantes

2,019

A86 Duplex

Alençon

Laval

2,018

Bourges Clermont Ferrand

Saintes

Net financial debt (2) (4)

Northern Lyon ring road

Lyon

(in €m)

Saint Etienne Brive la Gaillarde

Bordeaux

Gap Montauban Biarritz

Nîmes

Toulouse

Narbonne

ASF Cofiroute Escota Arcour

Puymorens tunnel

Orange Aix en Pce

17,157

16,617

2011

2012

Menton Monaco Nice

Toulon

(1) Excluding concession subsidiaries’ works revenue. (2) Including ASF Holding and Cofiroute Holding. (3) Before tax and financing costs. (4) At 31 December.

Motorway networks under concession in Europe (in km  (*))

VINCI

4,385

Abertis

3,327

Atlantia

3,026

Eiffage

2,607

Brisa

1,696

Ferrovial

1,484

(*) Sources: internal studies and company literature.

Revenue by network (1) (in €m and as a %)

ASF Escota Cofiroute Arcour

2,525 667 1,208 40

57% 15% 27% 1%

40

Business activity Concessions VINCI Autoroutes

JeanBernard Devernois

Chairman of the Roanne Loire Nord Chamber of Industry and Commerce

“To legitimately claim its position as the western gateway to the Lyon urban area, Roanne needed an effective transport link. The A89 gives it just that.”

VINCI 2012 Annual Report

Business activity Concessions VINCI Autoroutes

In January 2013, the last section of the A89 motorway leading in to the Lyon urban area was inaugurated. This transversal artery on which construction began in 1990 puts Lyon just five hours and 15 minutes from Bordeaux and establishes a link between areas determined to develop their potential, such as Le Roannais. The A89 has established a direct motorway link between Bordeaux, Clermont Ferrand and Lyon. What are the benefits it brings to an area like Le Roannais?

Roanne flourished in the first half of the 20th century because of its location as a double hub, on the N7 express road link and the Paris–Lyon–Mediterranean rail line. In the 1960-1980 period, the routing of the A6 motorway and then the TGV high-speed rail line through Mâcon weakened its position. During this period, the city also had to undertake an industrial reconversion against the backdrop of crisis in the textile and mechanical engineering sectors, and the phenomenon of globalisation. Roanne has now found a new balance for its activities, which have been diversified and strengthened. The overconcentration on industry has been corrected by the arrival of service activities and Roanne companies have gained in value-added by focusing on the top end of their markets. But the problem of accessibility remained. To legitimately claim its position as the western gateway to the Lyon urban area, Roanne needed an effective transport link. The A89 motorway gives it just that, with a magnificent, fluid and reliable road layout.

What immediate and medium-term impacts is the new road link expected to have on the area’s economic fabric?

Companies in the area will be more easily able to attract executives, which will help consolidate its service-sector reconversion. Our universities will also benefit from better mobility and the road layout has revealed the charm of our landscapes. Tourist activity – coupled with our gastronomic tradition – is bound to take advantage of the new situation. For the Lyon area, the A89 opens up opportunities to the west that it struggled to exploit given inadequate infrastructure. It will help the establishment of decentralised entities in the Roannais area’s attractive land base.

The A89 is often described as the “consultation” motorway. Would you agree with this?

The term strikes me as absolutely justified. First, there was close consultation between political decision-makers, the chamber of commerce network and companies in the area. In Le Roannais, all the stakeholders, including environmental protection non-profits, believed that the motorway would be a genuine asset if well designed and built. Secondly, ASF played a major role by doing the work required to really bring the area together and take all its aspects into account so that all the parties would adhere to the project.

41

42

Business activity Concessions VINCI Autoroutes

Sound performance and sustained investments

In 2012, VINCI Autoroutes continued to invest in extending and modernising its networks and rolled out new services while also optimising its operating performance.

Economic performance Despite tough economic conditions leading to an unprecedented fall in traffic over the whole of the French motorway network, VINCI Autoroutes’ revenue increased 0.7% to €4.4 billion in 2012. Traffic levels fell due to weak economic trends, unfavourable weather conditions in the first half of the year and persistently high fuel prices. Light vehicle traffic contracted 1.4% while heavy vehicle traffic fell 3.5% as economic stagnation in France and the recession in southern Europe depressed both national and international trade. Against this backdrop, the slight increase in toll revenue came from two factors: ramp up, as forecast, of the A86 Duplex in the Paris region, which was brought into service in 2011 and accounted for 0.2% of the increase; and the effect of contractual price rises, which compensated primarily for the substantial investments made under the motorway operators’ master plans (2.1%). Cash flow from operations before tax and financing costs rose from 69.4% in 2011 to 69.5% in 2012. This was partly the result of the productivity gains generated by automation of toll collection, which now accounts for 95% of transactions, but was mainly due to the work begun several years ago to develop collaboration between VINCI Autoroutes’ various companies and the continuous investment to optimise motorway services. The efforts already

made in management of electronic toll collection (ETC), purchasing and information systems were supplemented by the growing convergence in organisation and operating methods between the different networks. Over the next few years, this convergence will lead to further optimisation of VINCI Autoroutes’ operating performance in economic terms, but also in terms of the service offered to users.

Investment and debt VINCI Autoroutes’ investment remained at a very high level, totalling €1.1 billion in 2012. Apart from network extension and modernisation as stipulated in contracts, further investment was made under the green motorway package (see p. 45). In accordance with the commitments made to the concession grantor, this package will come to an end in spring 2013. All programmes combined, the works contracted by VINCI Autoroutes to companies in the construction sector provide employment for approximately 7,500 people every year, i.e. the equivalent of the company’s workforce. Taking all networks into account, these jobs make a significant contribution to supporting economic activity in the different regions. The quality of VINCI Autoroutes’ operational performance and the resilience of its business model are supported by prudent debt management, in line with VINCI Group policy. In July 2012, ASF signed a five-year syndicated credit facility of €1.8 billion, replacing one due to expire in December 2013. At 31 December 2012, the net financial debt of the motorway companies, including holding companies, came to €16.6 billion, compared with €17.2 billion at 31 December 2011.

Infrastructure New sections

A89. The inauguration on 19 January 2013 of the 53 km Balbigny–La Tour de Salvagny section marked the completion of the massive A89 motorway project between Bordeaux and Lyon (see p. 8). After 16 years of works financed by ASF, this transversal 500 km artery linking the Atlantic seaboard to the Rhone Valley has now been brought into full service, reducing travel time from the outskirts of Lyon and the city of Bordeaux to five hours 15 minutes. Building the last section represented a €1.5 billion investment for ASF and four years of works, including construction of five interchanges and a junction, eight viaducts (cumulative length 2,150 metres), 108 standard bridges and tunnels and three twin-tube tunnels (a total of 5,700 metres). After completion of civil engineering and road building works, work in 2012 consisted primarily of installing safety and operating equipment, particularly in the three tunnels, and preparing for entry into service. Operation of the new section, facilitated by feedback from the experience gained in the many motorway tunnels built and managed by VINCI, is handled by teams recruited entirely through internal transfers.

VINCI 2012 Annual Report

01 Rollout of the new equipment (automatic incident detection, CCTV, etc.) helps guarantee customer safety. 02 A total of 322 of the 444 rest and service areas in the VINCI Autoroutes network were upgraded as part of the green motorway package.

02

Business activity Concessions VINCI Autoroutes

43 01

44

Business activity Concessions VINCI Autoroutes

ASF group

Cofiroute

Revenue (*)

Revenue (*)

(ASF and Escota) (in €m and as a % of revenue (*))

Throughout the entire duration of the project, the teams collaborated in a very proactive manner with stakeholders concerning biodiversity conservation, in particular. The measures conceived and put in place with local nature protection non-profits included two innovative programmes. The first concerned protecting the white-clawed crayfish, which entailed raising several hundred specimens taken from local streams in an artificial habitat before reintroducing them into the natural environment. The second programme focused on protection of bats and entailed building two experimental crossings above the motorway. A9 Montpellier. The displacement of a section of the A9 to bypass Montpellier, a project confirmed in 2011 following a public consultation process, is one of the main investment projects for VINCI Autoroutes’ networks over the next few years. It entails building a new 12 km section and redeveloping 13 km of existing sections. Studies, land release procedures and preliminary work started in 2012, with the aim of bringing the new double section into service on 31 December 2017.

Widening projects A63. In early July 2012 ASF completed work on the Basque Coast motorway to widen an 18 km section between Ondres and Biarritz into a three-lane dual carriageway significantly ahead of the contractual deadline. Work on a second 22 km section between Biarritz and the Spanish border depends on the outcome of negotiations between the French state and local government authorities concerning the Saint Jean de Luz interchange. Upgrading these two sections represents a total investment of €700 million. A9. ASF continued with major widening work on the A9 on the approach to the Spanish border. Progress made on a first 14 km section (Perpignan Nord–Perpignan Sud) enabled partial opening of a third lane over 10 km, with full entry into service of the three-lane dual carriageway scheduled for June 2013. For the second section (Perpignan Sud–Le Boulou), completion of studies and preliminary procedures will allow launch of the first works phases in 2013. A50. The widening project for a 21 km section between La Ciotat and Bandol, launched at the beginning of 2011 and representing an investment of €91 million, was successfully completed by Escota in less than two years. Cofiroute network. Studies are under way for widening sections carrying heavy traffic on the A71 between the junctions with the

3,170

3,191

2011

2012

(in €m and as a % of revenue (*))

1,202

2011

Cash flow from operations (**) 2,185

2,207

68.9% 2011

1,208

2012

Cash flow from operations (**) 848

856

69.1%

70.6%

70.8%

2012

2011

2012

Net financial debt (***) 11,316

11,149

2011

2012

Net financial debt (***) 2,960

2,877

2011

2012

(*) Excluding concession subsidiaries’ works revenue. (**) Before tax and financing costs. (***) At 31 December.

A85 and the A20 (5 km); on the A10 between the Chambray interchange and the junction with the A85 (6 km); and between the junctions with the A19 and the A71.

Upgrading projects VINCI Autoroutes companies launched or continued several network upgrading projects in 2012, the most notable being: - construction of a new interchange north of Angers on the A11, for the ASF network; - redevelopment of the Gatignolle interchange near Angers on the A11, for the Cofiroute network; - upgrading of the junction with the A52 on the A50 and the Nice West access on the A8, for the Escota network. In addition, in 2012, Escota completed the safety upgrade programme (apart from the final finishing works) for all the tunnels in its network, which represented an investment of close to €400 million over a decade.

01 Escota completed the safety upgrade programme for all the tunnels in its network. 02 The “men in yellow”, the most visible link in the safety chain, participate in the awareness-raising actions regularly conducted in the network’s rest and service areas.

VINCI 2012 Annual Report

Business activity Concessions VINCI Autoroutes

Examples of the green motorway package Seven water protection zones were implemented by ASF on the A10 close to drinking water intakes, primarily in CharenteMaritime. The tanks built receive runoff and accidentally polluted water, which is then treated in specialised units. Two carpooling parking facilities with 75 places each were brought into service in 2012 by Cofiroute on the

outskirts of the Paris region, at the Ablis (A11) and Allainville (A10) toll plazas. By the end of December, 605 parking places had been created on VINCI Autoroutes’ networks. Seventy escape routes for wild boar were designed and installed by Escota alongside its network, in collaboration with hunters’ associations. These one-way crossings allow animals that have managed to penetrate into the fenced-off area alongside the motorway to escape back into the natural environment.

01

02

Lastly, Cofiroute and ASF launched the first phase of works in connection with construction of the Tours–Bordeaux SEA high-speed rail line project (see p. 62), which involves 24 points of contact with the A10 motorway. Similar works were started on the interfaces between the Cofiroute network and the future Bretagne-Pays de la Loire high-speed line.

Green motorway package

45

Over 40% of the investment scheduled as part of the green motorway package was made in 2012. This innovative package, which is a return to the “adossement” system of concession companies financing additional investments that were not initially included in their contracts, has made it possible to launch a wide-ranging programme that entails environmental upgrading of the older sections of motorway companies’ networks in return for a one-year extension of the signatories’ concession contracts. The green motorway package is unique both in terms of its contractual framework and the scale and speed of execution of the works. Between signature of the package in the first quarter of 2010 and its completion in the spring of 2013, VINCI Autoroutes will have financed, studied, implemented and completed an investment programme totalling €750 million.

Organised around five component parts (protecting water resources; protecting nearby residents from noise; conserving biodiversity; eco-refurbishment of rest and service areas; and reducing CO2 emissions), the green motorway package has involved 1,800 projects over the whole VINCI Autoroutes network. Hydraulic infrastructure, noise barriers, crossings for animals, wastewater treatment units, source-separated waste collection in rest and service areas, parking facilities for carpooling, no-stop electronic toll collection (ETC) lanes: these works, spread out over the whole VINCI Autoroutes network have made it possible to upgrade older sections to the environmental standards applied to more recent sections. During the three years of work, 6,000 direct jobs were created, together with the same number of indirect jobs. VINCI Autoroutes’ environmental commitment applies not only to motorway infrastructure but also to operation. All the concession companies’ regional offices have obtained ISO 14001 certification. Aside efforts to reduce the environmental impact of their activities, VINCI Autoroutes companies devote substantial resources to the upkeep of the natural environment in the 20,000 hectares of green spaces alongside its motorways by practising responsible management of this land.

Safety

Safety on the motorways The key priority of VINCI Autoroutes, and one that governs all its operations, is to guarantee the safety of its customers on motorways. The most visible link in this chain is the 2,300 employees working for the viability-safety division (the “men in yellow”), who are permanently present on the networks. In 2012, they installed 27,230 work-in-progress markers, removed 77,708 bulky objects from traffic lanes and carried

46

Business activity Concessions VINCI Autoroutes 01 Radio VINCI Autoroutes sets the standard for the accuracy and rapid response of its traffic information. 02 201 no-stop (30 km/h) ETC lanes are in service on the VINCI Autoroutes network. 03 The VINCI Autoroutes smartphone application has been downloaded 450,000 times since it was launched in 2011 and is used regularly by over 300,000 customers. 04 The VINCI Autoroutes Foundation for Responsible Driving conducted numerous awareness-raising actions. During the “Adopt the breathalyser reflex” operation, 100,000 free breathalyser kits were distributed.

out 61,775 interventions with customers whose cars had broken down or been involved in accidents. They are part of a chain of information and intervention coordinated by the control centres, which ensure a rapid response to any incident by mobilising the appropriate resources, in liaison with the public services responsible for safety. This human and technical organisation is particularly effective during the winter viability campaigns, which every year mobilise 2,000 employees and 403 gritting and snow-removal machines. Aside scheduled operations to maintain infrastructure to the highest standards, driver safety is also enhanced by installation of new equipment such as video, automatic incident detection and warning displays. Other safety measures involve speed regulation systems governed by traffic density, deployed in coordination with the government on sections with particularly heavy traffic and in periurban areas.

The VINCI Autoroutes Foundation for Responsible Driving The VINCI Autoroutes Foundation for Responsible Driving has set itself the goal of changing attitudes and behaviour concerning road safety and helping advance knowledge in this field. To carry out this dual mission, the Foundation conducted numerous awareness-building actions in its second year of existence. These actions took place either as part of national campaigns (heavy vehicle safety days, national sleep awareness day, the safety for bikers operation during the Motorbike Grand Prix in France, the “Adopt the breathalyser reflex” operation, and the campaign to ensure the safety of the “men in yellow”, etc.), or as regional and local operations carried out with VINCI Autoroutes operating entities and special events organised on the network (the Etapes Estivales et Hivernales summer and winter events, in particular). Using a budget of €2 million a year, the Foundation also

supports non-profit and community projects sponsored by VINCI Autoroutes employees that help combat unsafe driving practices. In the field of research into road risk, the Foundation has published the full results of an extensive scientific survey coordinated by the Raymond-Poincaré hospital in Garches (near Paris) on the problem of drivers nodding off at the wheel, which is responsible for 40% of fatal accidents on motorways. Fifteen years after a first study on this topic, the data gathered highlighted the increasing sleep deficit of French drivers, particularly before the big summer holiday migrations. In partnership with the non-profit organisation Ferdinand, chaired by the actor Patrick Chesnais, the VINCI Autoroutes Foundation has also designed a collaborative multimedia platform – “Roulons Autrement” (A new way of driving) – aimed specially at raising the awareness of younger drivers. The platform has been online since 15 January 2013 on www.roulons-autrement.com and also on social media (Facebook and Twitter).

Workplace safety for employees VINCI Autoroutes has a proactive policy of preventing workplace accidents, strongly supported by management and rolled out with all front-line employees, in particular through prevention visits, the regular 15-minute safety sessions and systematic analysis of high-risk situations. These efforts have led to an improvement in safety results, with a work accident frequency rate, all operating entities combined, of 9.85 in 2012, compared with 11.63 in 2011 – ASF, for instance, achieved the lowest frequency rate in its history.

01

02

VINCI 2012 Annual Report

Business activity Concessions VINCI Autoroutes

47

03

04

VINCI Autoroutes acts with the same determination in its role as prime contractor for the thousands of work projects carried out by partner companies on its networks. The “100% worksite safety” initiative launched in March 2012 aims to achieve zero accidents on worksites and in motorway operation. Some 350 VINCI Autoroutes employees responsible for prime contractor assignments received specific training during the year. VINCI Autoroutes has introduced new rules in its contracts covering management of safety on worksites, with penalties for non-compliance, the aim being to improve safety for both staff and customers when work is being carried out without interruption to traffic.

Services

Electronic toll collection and remote assistance

VINCI Autoroutes plays an active role in development of electronic toll collection (ETC), which simplifies journey management and offers time savings for motorists. Supported by simple and effective communication, VINCI Autoroutes’ ETC sales platform enabled the sale of 364,000 new transponders (tags) in 2012. A record was set during the summer, with 45,127 tags sold in July alone. At the end of the year, the total number of tags in service for light vehicles came to 1.7 million units, an increase of 12% over the previous year. The appeal of ETC was reinforced by new no-stop toll lanes (vehicles pass through at 30 km/h). These lanes, which offer a number of advantages in terms of driver convenience, traffic flow, fuel savings and lower greenhouse gas emissions, are currently being installed at the main toll plazas on the VINCI Autoroutes network. The creation of dedicated lanes entails substantial work on the barriers themselves to guarantee optimal safety for customers and operational staff. At end 2012, 201 dedicated lanes were in service on the VINCI Autoroutes network, and 136 million transactions were recorded during the year. The development of ETC for subscribers goes hand in hand with modernisation of toll plazas and installation of automated lanes equipped with all-payment terminals linked to VINCI Autoroutes’ remote assistance services.

48

Business activity Concessions VINCI Autoroutes

Fifteen remote-operation centres employing almost 200 specially trained operators, totally integrated within the operations organisation, cover all VINCI Autoroutes’ motorways. The increasing automation of toll collection is bringing change to the traditional role of toll attendants, who now work more in customer relations and in the technical maintenance of toll equipment, thus protecting jobs. For every 100 transactions recorded on VINCI Autoroutes’ networks in 2012, 42 were paid by ETC tags and 53 in other automated lanes.

Rest and service areas In parallel with the eco-refurbishment programme conducted on 322 of the 444 rest and service areas in the network as part of the green motorway package, VINCI Autoroutes carried out works to significantly increase quality of service: new restroom buildings equipped with eco-friendly flush mechanisms and automated disinfection systems, refurbishing of green spaces and new picnic equipment, redesigned pathways and easier access for people with disabilities. This redevelopment work, carried out simultaneously at the great majority of sites, has enhanced the quality of service offered to customers using VINCI Autoroutes networks. VINCI Autoroutes continued with work to broaden the range of services available to customers in its service areas. As the operating contracts for commercial facilities reach their term, new well-known highstreet brands, such as McDonald’s, Hippopotamus, Paul or Flunch are appearing on the networks. VINCI Autoroutes is also renovating buildings and enhancing safety in outdoor spaces, particularly by separating circulation of light and heavy vehicles. VINCI Autoroutes organises special events in its rest and service areas during holiday periods to encourage travellers to take regular, relaxing breaks. The 2012 Etapes Estivales (summer events) mobilised a thousand or so employees in organising 2,800 days of special events on some 50 rest and service areas, on the themes of the environment, sport, culture and safety, in partnership with Radio VINCI Autoroutes and the VINCI Autoroutes Foundation for Responsible Driving.

01

On the same principle, events were organised for the Easter, All Saints’ Day (1 November) and Christmas holidays – an opportunity for VINCI Autoroutes to present the equipment used in the winter viability campaign and raise motorists’ awareness of best practices in winter driving. Lastly, VINCI Autoroutes is increasing its capacity to accommodate heavy goods vehicles at its rest and service areas. An additional 334 parking spaces were created in 2012 (on the A8, the A63 and the A85), including 50 or so in a secure new truck park in Labenne (A63) in the Landes region. Information about the availability of heavy goods vehicle parking spaces in rest and service areas, using panels gradually installed on the network upstream of these areas, enables better organisation of working and resting time for HGV drivers and their employers.

01 During holiday periods, VINCI Autoroutes organises many events in rest and service areas on its networks to encourage travellers to take a break.

VINCI 2012 Annual Report

Customer information and services Radio VINCI Autoroutes, created in 2011, proved its full worth in 2012. The cost savings generated from combining the former Cofiroute and ASF-Escota radio stations were reinvested in a broader array of programmes, in increasing the station’s broadcasting resources and developing information and services. Radio VINCI Autoroutes covers the 4,363 km of motorways in service and is both a general-interest radio station offering quality programmes – with a uniform editorial line and sound signature across all the networks – and a motorway radio service that sets the standard for the accuracy and rapid response of its traffic information. Broadcasting architecture and regional relays were designed to provide listeners with the most accurate local information and continuity throughout their journey. Close collaboration between the journalists and the operational teams, who share the same culture and use the same trafficmonitoring tools, helps optimise the speed at which information is broadcast, particularly for notification of incidents. The VINCI Autoroutes application for smartphones contributes to greater safety on the networks by giving users real-time information on traffic conditions (traffic on the route chosen, tailbacks, motorway works, etc.) and also allows users to notify an accident; after verification, the information is broadcast on other motorway media. The VINCI Autoroutes application also informs users about the services available on upcoming rest and service areas, enabling them to assess these services and access comments made by the user community. The VINCI Autoroutes application, an innovative tool for assisting travel that was supplemented by new functions for the 2012 version, has won the approval of the motorway industry and attracted many users. With almost 450,000 downloads since its launch in 2011, it is used regularly by over 300,000 customers. The 3605 number is VINCI Autoroutes’ new customer service. Launched in October 2012, it supplements the radio and Internet services. This single and easy to memorise number allows users to contact a VINCI

Business activity Concessions VINCI Autoroutes

49

Autoroutes adviser, on a 24/7 basis, to prepare their trip through information about weather and traffic on the chosen route, advice about the best itinerary, information on ETC and the cost of a journey, and even notify the operator about an incident. The 3605 number is staffed by VINCI Autoroutes employees, mostly former toll attendants, who are specially trained and use tools specifically developed for this purpose. In the first weeks following its launch – publicised by Radio VINCI Autoroutes – the 3605 number received and handled several hundreds of calls a day (37,135 altogether in the first three months of operation).

International Germany

Toll Collect, in which Cofiroute has a 10% stake, developed the toll system for heavy vehicles covering the entire German motorway network (12,800 km) and has been operating it since 1 January 2005. The system uses satellite technology coupled with GSM links via on-board terminals. After extension of the system to Austria in 2011, in partnership with the Austrian motorway operator Asfinag, Toll Collect extended its coverage to 1,135 km of A-roads in Germany, at the request of the Federal government. The tolls collected on behalf of the German government amounted to €4.4 billion. The decision on settling the dispute between the government and Toll Collect relating to late start-up of the project had not been resolved by the end of 2012.

United States Cofiroute USA operates the 35 km 91 Express Lanes urban toll motorway in California, which is equipped with a fully automated price modulation, barrier-free system. Talks are in progress to extend the operating contract to a neighbouring motorway in Riverside County. In Minnesota, Cofiroute USA operates an innovative toll system on high occupancy and toll (HOT) lanes on the I-394 and I-35W motorways in the Minneapolis urban area, which is free for carpooling vehicles while solo drivers pay a toll. In other international projects, VINCI Autoroutes has also contributed its expertise to motorway projects being developed by the Group in Russia (the Moscow–St Petersburg motorway, see p. 59) and several other countries where calls for tender are under way.

Outlook The lack of visibility for economic conditions in France and Europe at the end of 2012 prevents accurate forecasting of traffic volumes in 2013. They will be bolstered by greater use of the last link in the A89 towards Lyon and the most recent infrastructure (the A86 Duplex in the Paris region, A19). In view of the expected impact of bringing new sections and infrastructure into service and contractual toll increases, toll revenue should rise slightly in 2013. At the same time, the impact of synergies between VINCI Autoroutes networks, which generate economies of scale and help optimise operating performance, should allow it to maintain Ebitda margin at a level similar to that achieved in 2012. In compliance with the commitments made in their master plans, VINCI Autoroutes motorway companies estimate that they will spend around €850 million on widening and upgrading work on their networks in 2013. Improving safety, traffic flow and driver convenience on its motorways while reducing their environmental footprint creates long-term value for government authorities. In parallel, VINCI Autoroutes will pursue its policy of developing motorway services. Its investment in new-generation ETC, motorway information services, travel optimisation services and the quality of customer service in its rest and service areas reinforce the appeal of its networks, and therefore the advantages of using the motorway as opposed to other types of road.

VINCI Concessions 50

Business activity Concessions

VINCI 2012 Annual Report

Business activity Concessions

Profile VINCI Concessions supports its concession-granting partners in the design, financing, programme management, operation and maintenance of major public infrastructure and amenities in countries around the world. Its expertise is built on the daily, local contact of its operating teams with users and customers, enabling it to better understand and meet their expectations through innovative services and application of the highest standards of quality. This focus on the end customer, which informs VINCI Concessions’ approach at all stages of projects and infrastructure life cycle, is supplemented by an ongoing determination to respond to the concerns of all stakeholders. This optimises the integration of engineering structures into their surroundings, whether in environmental, economic or social terms. Airports. With the acquisition of ANA(*), VINCI Airports will be strengthening its presence in the airport concession market. The subsidiary, which will be managing 23 airports around the world (10 in Portugal, 10 in France and three in Cambodia) will handle over 40 million passengers a year, 15 million of them at the Lisbon hub. Road infrastructure. VINCI Concessions currently operates or is building over 1,000 km of motorways, together with road bridges and tunnels, in seven European Union countries and also in Russia and Canada. Its constant concern is to optimise the operation of the infrastructure so as to satisfy users to the highest possible levels. Parking. VINCI Park is the world’s leading operator of parking facilities, with the most comprehensive offer in the market. It is active in 13 countries, mainly in Europe and North America, with 1,514,000 on-road and off-road parking spaces (in 2,600 car parks), under nearly 2,500 concession or service contracts. Rail infrastructure. In France, VINCI Concessions holds the concessions for the SEA Tours–Bordeaux high-speed line, the GSM-Rail digital communication network and the Rhônexpress link between Lyon city centre and the airport. In Belgium, it holds the concession for the underground Liefkenshoek rail tunnel in the port of Antwerp. Stadiums. In France, VINCI Stadium will be the future operator of the new Nice and Bordeaux stadiums and the Dunkerque arena under partnership contracts, and is developing a network of sports and cultural facilities that is unique in Europe. It also holds the concession and operation contracts for the Stade de France in Saint Denis, near Paris, and the MMArena in Le Mans. (*) Contingent on fulfilment of the conditions provided for in the share disposal contract and, in particular, obtaining all the necessary authorisations from the different EU authorities.

51

52

Business activity Concessions VINCI Concessions

VINCI 2012 Annual Report

53

Business activity Concessions VINCI Concessions

Revenue (*)

Net income attributable to owners of the parent

(in €m)

(in €m and as a % of revenue (*))

888

59

915 32

2011

2012

Operating income from ordinary activities

3.6%

6.4%

2011

2012

Cash flow from operations (**)

(in €m and as a % of revenue (*))

(in €m and as a % of revenue (*))

130

139

308

285

14.7%

15.2%

34.7%

31.1%

2011

2012

2011

2012

Net financial debt (***) (in €m)

1,738

(*) Excluding concession subsidiaries’ works revenue. (**) Before tax and financing costs. (***) At 31 December.

2011

Revenue by business activity (*) (as a percentage)

VINCI Park VINCI Airports VINCI Stadium Other concessions

67% 18% 11% 4%

Revenue by geographical area (*) (as a percentage)

France Europe Rest of the world

68% 18% 14%

1,441

2012

54

Business activity Concessions VINCI Concessions

VINCI Park and Buzzcar have joined forces to promote sustainable car use. The innovative community platform Buzzcar, launched initially in Lille and Tourcoing and currently being extended to other large cities in France, brings car owners and drivers together around a simple, secure car-rental service between private individuals. You advise committees set up to promote innovation and technologies in a number of big cities around the globe on the issue of transport. What do you think will be the main characteristics of the mobility of the future? It will be multimodal. Most people in the rich countries walk out of their homes and immediately climb into a car. However, they are increasingly tending to live in urban areas where the car is not always the most effective – or the fastest – way of getting around. Conversely, it is definitely the most expensive: running a car costs around €6,000 a year and this cost is constantly rising. In future, we will be able to choose our mode of transport depending on the nature of the trip: walking, cycling, metro, bus, train and, from time to time, the car, which we will pay for only when we use it. In addition, the size and characteristics of the vehicle will depend on the purpose of the trip: a one- or six-seater, a van or scooter.

Over 10 years ago, you founded Zipcar, a pioneering carsharing service company, in the United States. What is the connection between it and the Buzzcar service in France?

With Zipcar, car-sharing is organised around rental of vehicles belonging to a fleet. When we created this service, customers often asked us: “Why can’t I have the convenience of a car near my home, in my neighbourhood, in my city?” It was an economic problem: we couldn’t guarantee a large enough return on investment per vehicle to be able to offer this service everywhere. With Buzzcar, individual car owners rent out their own car, so we’re capitalising on the excess capacity of cars belonging to other people. A private car is unused 95% of the time on average. If a neighbour rents it once a month, it’s a straightforward profit for the owner. Car-sharing can be organised everywhere, in the city or elsewhere. As for choosing France to introduce this solution, it reflects the fact that France is ahead of the USA as far as multimodal transport is concerned.

You have joined forces with VINCI Park to develop Buzzcar. Why did you make this choice?

VINCI Park car parks are everywhere – and they’re full of cars just sitting there. So it was logical to think of VINCI Park in connection with a car-rental plan. I also liked the fact that VINCI Park had already begun thinking about developing services based on the new mobility solutions that are starting to emerge. Very few big companies in the automobile sector share my forwardlooking vision of transport. And lastly, I must admit that I was very impressed by the quality of customer reception and service in their car parks!

VINCI 2012 Annual Report

55

Business activity Concessions VINCI Concessions

“A private car is unused 95% of the time. We should capitalise on this excess capacity by developing car-sharing!”

Robin Chase

Founder and managing director of Buzzcar

56

Business activity Concessions VINCI Concessions

New momentum in rolling out a model Initially applied to road infrastructure and parking facilities and more recently extended to rail infrastructure, VINCI Concessions’ design-build-operate model is taking on a new dimension with a stronger presence in the airport and stadium markets and the conquest of new markets outside France.

In 2012, VINCI Airports handled 9.6 million passengers, an increase of 12% compared with 2011, and generated revenue of approximately €170 million, up 17.8%. VINCI Concessions’ acquisition of the Portuguese operator ANA (*) illustrates the Group’s determination to make the airport sector a priority axis of its expansion. As concession company for 23 airports handling over 40 million passengers a year and generating revenue of over €600 million, VINCI Airports will have a solid base for rolling out its model of airport operator serving regions, airline companies and users.

In 2012, these 10 airports handled more than 30 million passengers. They have recorded average growth of over 4% a year in passenger numbers over the last 10 years. Lisbon Airport, the hub of the national airline TAP, alone attracts 15 million passengers a year. It handles 25% of passengers travelling between the European Union and Brazil and also occupies a strategic position for flights to Portuguesespeaking Africa (Angola and Mozambique). All ANA’s airports serve destinations with high tourist appeal and cater primarily for international passengers. Another source of business is the sizeable volume of familyrelated travel, since a large number of Portuguese nationals living in other EU countries make frequent visits to their home country. The contract to acquire shares in ANA was signed on 21 February 2013. The transaction has been submitted for the approval of the European competition authorities concerned.

Portugal

France

In line with its strategic goal of developing its airport concessions business, in 2012 VINCI announced its candidature to take over ANA, the Portuguese airports concession company, in the framework of its privatisation. On completion of the selection process, the Portuguese government chose the Group as the successful candidate to acquire the national operator. ANA, which has a 50-year concession contract, manages the country’s 10 main airports, located on the mainland (Lisbon, Porto, Faro and Beja), in the Azores (Ponta Delgada, Horta, Flores and Santa Maria) and in Madeira (Funchal and Porto Santo). ANA’s activities encompass management of the airports and their retail areas, together with ground handling services.

Ten airports in operation. At end 2012, VINCI Airports was chosen to take over operation of the Poitiers-Biard airport, starting 1 January 2013. This new public service management contract brings to 10 the number of French regional airports managed by VINCI Airports. Excluding Poitiers-Biard, these airports handled 5.3 million passengers in 2012, an increase of 7.6% over one year. Growth in traffic was particularly strong for the Nantes-Atlantique airport, which VINCI Airports has been operating since 1 January 2011. As France’s busiest regional airport for charter flights, Nantes Atlantique posted a 12% increase in passenger numbers in 2012, which reached a record number of 400,000 per month during the summer season. Thirty-two new routes were created in one year, to destinations in Belgium, France, Germany, Italy, Spain and the United Kingdom.

VINCI Airports

(*) Contingent on fulfilment of the conditions provided for in the share disposal contract and, in particular, obtaining all the necessary authorisations from the different EU authorities.

01

02

VINCI 2012 Annual Report

Business activity Concessions VINCI Concessions

03

The Grand Ouest airport. Since 1 January 2011, Aéroports du Grand Ouest, a company owned 85%, has been given responsibility by the French state, with the support of local government authorities, for the financing, design, construction and management of the new airport to serve the Nantes region. It will replace the existing Nantes Atlantique Airport. VINCI Airports continued with work to implement this project in 2012. Favourable opinions were handed down by the competent authorities on environmental procedures (Water Act and protected species) and on the programme to upgrade local access roads. All of the land needed to complete the

operation has been acquired (including 85% by amicable settlement), while 30 agricultural land release agreements out of the 40 farms concerned were also signed by amicable settlement. The new airport will reduce the number of Nantes urban area residents affected by aircraft noise from 42,000 today to just 900. The design of the new infrastructure, which complies with the requirements of the Grenelle environment law, aims to reduce energy consumption and carbon footprint to a minimum. The layout of the runways (one for landings, the other for take-off) optimises flight approach and taxiing time, while that of the terminal, whose buildings are designed to be energy positive, will divide energy consumption per passenger by three compared with an old-generation airport. Works are expected to start in 2014.

01 Three new airline companies were welcomed and two new routes set up from Siem Reap. 02 VINCI Airports’ goal is to provide all the expertise needed to run an airport. 03 With the acquisition of ANA, the Portuguese national company that holds the 50-year concession contract for the country’s 10 main airports, VINCI Airports is strengthening its market position.

57

58

Business activity Concessions VINCI Concessions

01

Cambodia Cambodia Airports, a 70%-owned subsidiary of VINCI, is the concession company for Cambodia’s three international airports, serving the capital Phnom Penh, the Unesco World Heritage site of Siem Reap, near the Angkor temples, and Sihanoukville, a seaside resort and deep-water port in the south of the country. Some 2.2 million passengers used the Siem Reap airport in 2012 (up 22%), while the Phnom Penh airport handled 2.1 million passengers (up 13%), and also recorded sharp growth in freight business, which rose 50% over one year to 28,000 tonnes. Three new airlines were welcomed during the year and two new routes opened up from Siem Reap, to Frankfurt and Manila (Philippines). Cambodia Airports invested $28 million in equipment and extensions to the three airports in 2012. Elsewhere, VINCI Airports provided assistance for the commissioning of Kutaisi Airport in Georgia, and will be assisting VINCI Construction Grands Projets with the new international Dushanbe terminal to be built in Tajikistan.

Road infrastructure Following new contracts won in the United Kingdom and the United States, VINCI Concessions has a portfolio comprising some 20 roads, bridges and tunnels around the world. To fully satisfy the users of this infrastructure and meet the concession grantors’ performance objectives, the concession companies that finance, build and operate more than 1,000 km of roads and the accompanying bridges and tunnels outside France have organised themselves into a coherent, interactive network that allows them to share their expertise and best practices.

United Kingdom 2012 saw strong growth in the United Kingdom, thanks to two 25-year partnership contracts (PFIs) won in collaboration with Eurovia for renovation and maintenance of road networks. The first, worth a total of around €800 million, concerns the London Borough of Hounslow and covers the upgrade, repair and maintenance of 432 km of roads and 763 km of pavements. The second, worth a total of around €750 million, covers the renovation and maintenance of the Isle of Wight road network (821 km of roads and 767 km of pavements). In both cases, the winning

02

consortium is composed of VINCI Concessions and Ringway, Eurovia’s UK subsidiary, which is in charge of works and maintenance. The first contract came into force in January 2013, while the second will start up in April 2013. These two new contracts join the Severn Crossings and the Newport Southern Distributor Road, already operated by VINCI Concessions since 1992 and 2002 respectively.

Germany VINCI Concessions is the leading operator of motorway concessions in Germany through the three public-private partnerships (PPPs) won between 2007 and 2011 under the A-Modell programme. On the A9, a 46.5 km section between the city of Lederhose in Thuringia and the border with the neighbouring state of Bavaria for which it signed a contract in 2011, VINCI Concessions has initiated widening works on a 19 km stretch. On the A5 (60 km section between Offenburg and Karlsruhe in Baden-Wurttemberg), a similar project on a 41.5 km section was 75% completed at year-end. The third PPP entrusted to VINCI Concessions concerns a 45 km section of the A4 between Gotha and Eisenach, in Thuringia, brought into service in 2010. The total amount invested in the three sections comes to €800 million.

Slovakia Granvia, a company managed by VINCI Concessions, brought the Banska Bystrica bypass, the fourth and last section of the PR1BINA expressway, into service in July 2012. This is the first motorway PPP in Slovakia; the first three sections, totalling 46 km between the towns of Nitra and Tekovské Nemce, were completed in 2011. The full entry into service of this expressway after just 36 months of works marked the completion of the largest public works contract in Slovakia’s recent history.

VINCI 2012 Annual Report

Business activity Concessions VINCI Concessions

59

01 A broad consultation process was conducted with all stakeholders for the entire route of the first section of the Moscow–St Petersburg motorway. 02 The last section of the PR1BINA expressway in Slovakia entered into service in July 2012.

The works were carried out by Granvia Construction, a subsidiary of Eurovia CS, while operation is handled by Granvia Operation, a wholly owned subsidiary of VINCI Concessions. Rollout of an integrated management system should lead to Granvia Operation obtaining triple certification (ISO 90001, ISO 149001 and OHSAS 18001) in 2013.

Russia Construction works continued throughout the year on the first 43 km section of the Moscow–St Petersburg motorway. The concession company is NWCC, in which VINCI Concessions has a 38.75% interest. At the end of December, almost 45% of the works had been completed. With the support of the non-profit organisation Pur Projet, which specialises in forest offset issues, NWCC conducted a broad process of consultation with all stakeholders – local residents, environmental organisations, municipalities and government departments – to put together a programme to upgrade the ecosystem of Khimki Forest, which is crossed by the motorway. Over the entire length of the route, the sustainable development plan put together on NWCC’s initiative will invest almost €100 million in environmental and social actions, on top of those already provided for in the initial contract. The section should open to traffic in 2014.

United States Alongside Walsh Investors and Bilfinger Berger PI International Holdings, VINCI Concessions won the contract for the East End Crossing in the state of Indiana. This bridge is not only VINCI Concessions’ first PPP in the United States, but also one of the largest transport infrastructure projects in North America. The contract covers building a 762 metre cable-stayed bridge over the Ohio River, linking Louisville, Kentucky to the south of Indiana; a 512 metre twin-bore tunnel and 19 standard engineering structures, together with work to upgrade the road network and associated infrastructure. The total value of the contract is close on $1 billion. The works, to be carried out by VINCI Construction Grands Projets and Walsh Construction, are scheduled to start in the summer of 2013 for completion in the autumn of 2016. The concession-operator consortium will handle operation and maintenance of the infrastructure for 35 years in return for fees calculated on availability of the structure.

60

Business activity Concessions VINCI Concessions 01 VINCI Park is developing payment by mobile phone for on-street parking. 02 US subsidiary LAZ Parking has bolstered its positions in the hotel sector. 03 A new remote-operation and operational assistance system is being rolled out in the main French car parks. Some 150 of them had been equipped by end 2012.

VINCI Park Benelux Coentunnel Company, held 18% by VINCI Concessions, 18% by CFE (a VINCI Construction subsidiary) and 5% by the CFE subsidiary Dredging International, has since 2008 held a 30-year concession for the new Amsterdam Coentunnel, which will double the capacity of the existing tunnel. The new structure is a 750 metre five-lane immersed tunnel, construction of which was completed in 2012. It will be brought into service in the first half of 2013, when upgrading work on the existing tunnel will start.

Greece Through its subsidiary Gefyra, VINCI Concessions holds the concession contract for the Charilaos Trikoupis Bridge, built by VINCI, which spans the Strait of Corinth and links the Peloponnese to mainland Greece. A toll interoperability system between all the Greek motorway concession companies will be brought into service in 2013. VINCI Concessions also holds stakes in the concession companies operating the Athens–Tsakona (365 km) and Maliakos– Kleidi (240 km) motorways. Work begun on these two motorways was suspended in 2011. Despite sizeable delays in land release and the serious economic crisis in the country, talks are now well advanced with the Greek authorities to resume the projects on a new, more viable long-term basis.

France The Tunnel du Prado Sud company, 58.5% owned by VINCI Concessions, has since 2008 held the 46-year concession for a 1,500 metre urban tunnel with two superimposed levels, each with two lanes. Reserved for light vehicles, it will extend the existing Prado Carénage tunnel towards the southern part of Marseille. The Prado Carénage tunnel was built and is operated by SMTPC, in which VINCI Concessions also owns an interest. Civil engineering work on the new tunnel was completed in 2012 and 2013 will be devoted to installing equipment with a view to bringing the tunnel into service in 2014. The total investment is €160 million.

VINCI Park’s revenue rose 2.6% to €615 million. Growth on a like-for-like basis was 1.5%, reflecting a satisfactory perform­ ance on the operating level despite weak economic trends in Europe. The number of spaces managed, up 3.6% over one year, totalled 1,514,000 at year-end. VINCI Park, the world leader in parking facilities, offers solutions to satisfy urban mobility demand and users’ expectations, thereby guaranteeing the means to continue developing its business outside France.

France Against a backdrop of virtually flat economic activity, VINCI Park’s revenue in its oldest market rose 1.3% on a comparable basis, with the increase in prices and season ticket sales offsetting the fall in hourly occupancy. A new remote operation and operational assistance system, which is a major step forward in optimising operational perform­ ance, is being rolled out in the main French car parks; 150 of them were equipped by the end of 2012. The system enables remote management of all car parks in the network from a national service centre, freeing up staff from surveillance tasks to focus on customer service and sales development. VINCI Park expanded its network of car parks to the towns of Vallauris Golfe Juan (30-year contract for 2,475 off-road and on-road spaces) and Bondy (1,425 spaces) and strengthened its presence in big urban centres through winning new contracts. The main developments were Bordeaux (the Pellegrin hospital car park: 1,427 spaces), Rueil Malmaison (Jean Jaurès car park) and Marseille. In this last city, VINCI Park opened the new 700-space Vieux Port Fort Saint Jean car park, which was built in the framework of a 40-year concession and serves, among other facilities, Mucem, the museum of European and Mediterranean civilisations. Also in Marseille, VINCI Park obtained an operating contract for the future car park in the Les Terrasses du Port shopping centre. It also started construction work for a new car park in Rue Frémicourt in Paris’s 15th district. In addition, in 2012 VINCI Park formulated innovative mobility services that will be rolled out as of 2013 and will confirm its lead in parking-related services.

01

02

03

Business activity Concessions VINCI Concessions

VINCI 2012 Annual Report

61

VINCI Park Revenue by geographical area (*) (as a percentage)

France United Kingdom Spain Belgium Rest of Europe North America



70% 9% 5% 3% 5% 8%

International Spaces by geographical area (**) (as a percentage)

France United Kingdom Belgium Spain Germany Rest of Europe North America



30% 8% 4% 5% 1% 6% 46%

Revenue by type of contract (*) (as a percentage)

Concessions and long-term leases Service contracts Freehold

77% 17% 6%

Spaces by type of contract (**) (as a percentage)

Concessions and long-term leases Service contracts Freehold

23% 76% 1%

VINCI Park’s competitive position (***) VINCI Park is active in 13 countries and is world leader in parking facilities. It is leader in France ahead of Effia and Q-Park and has very strong positions in the United Kingdom, Spain, the United States (via its subsidiary LAZ Parking) and in Canada (particularly in Quebec, where VINCI Park is the number one player).

(*) Excluding concession subsidiaries’ works revenue. (**) Including LAZ Parking (USA), consolidated under the equity method. (***) Sources: in-house study and company literature.

Revenue outside France rose 5.3%, primarily due to new contacts and several acquisitions. Europe. VINCI Park strengthened its positions in Belgium, with three new car parks in the Brussels region (Erasme and Lennik for a total of 1,544 spaces); in Switzerland (takeover of the Mon Repos car park in Lausanne); in Luxembourg, where business volumes rose 40% in one year; in the United Kingdom, where new contracts were signed, including that for the Derriford hospital car park in Plymouth (3,500 spaces). In Spain, new contracts were won in Madrid (Quevedo car park: 600 spaces), Seville (Nervion Plaza shopping centre: 1,250 spaces) and Zaragoza (El Clinico: 389 spaces). These helped stabilise business volumes in a very tough economic environment. In Germany, after the sharp contraction posted in 2011 linked to termination of a major contract, revenue returned to growth (up 10%). North America. VINCI Park Canada, which manages more than 130,000 spaces at 360 sites, continued on its strong growth trajectory, with revenue up 24%. This was due both to its solid long-standing positions (particularly in Quebec where VINCI Park is the number one player) and the 15 or so new contracts won. Chief among them were the McGill University health centre car park in Montreal, the Consilium Place and Four Seasons Hotel car parks in Toronto and the Eastern St Clare’s Mercy Hospital public parking facility in St John’s, Newfoundland. In the United States, LAZ Parking (50%-owned subsidiary whose revenue is not consolidated by VINCI Park) posted a 24% increase in revenue. The main contributors to this strong growth momentum were new contracts won for the University of Ohio (35,000 spaces), CNN’s world headquarters in Atlanta (2,000 spaces) and the Oakland International Airport (9,000 spaces). The US subsidiary also bolstered its positions in the hotel sector, in which it manages some 100 car parks, and strengthened its partnership with the authority in charge of transport for the Boston urban area (MBTA), for which it manages 45,600 spaces on 102 sites.

62

Business activity Concessions VINCI Concessions

Rail infrastructure As concession company for four projects already in operation or under construction in the rail infrastructure sector, VINCI Concessions has acknowledged expertise that helps it deploy its integrated model outside France, thus serving its clients and helping them guarantee user satisfaction.

France South Europe Atlantic high-speed line. The massive South Europe Atlantic highspeed line project (SEA HSL) between Tours and Bordeaux, in which all of VINCI’s business lines are involved, entered into its active phase in 2012. The new 302 km line also entails construction of 38 km of connections with existing lines. With a total investment of €7.8 billion (current value), it is the largest infrastructure concession project under way in Europe. The project is managed by the concession company LISEA, of which VINCI Concessions is the lead shareholder, while construction has been entrusted to the COSEA joint venture, led by VINCI Construction and including Eurovia and VINCI Energies, together with other players in the rail sector. The line will be operated and maintained until 2061 by MESEA, in which VINCI Concessions has a majority stake. Demonstrating VINCI’s capacity to mobilise expertise in engineering, project management and production, works were launched simultaneously over the entire route in 2012, with more than 5,000 people actively employed at the end of the year. They included 1,200 locally recruited and trained workers, thanks to exemplary coordination with state and local government agencies. By end 2012, excavation of 14 million cu. metres of material had been completed (out of a total 60 million cu. metres), along with 3.7 million cu. metres of backfill (out of a total of 38 million cu. metres). Some 84 standard engineering structures were under construction or completed (out of 430), together with 15 of 27 major engineering structures. Five of the re-routed sections of the A85 and A10 motorways, out of the eight that will have to be done, were in service at the point at which they join the line. From the first studies and throughout its construction, the project has been the focus of continuous collaboration with stakeholders. Discussions have covered conservation of the ecosystems crossed by the line, the introduction of socioeconomic measures, and the best ways of integrating the project into the regions concerned (see p. 2). The worksite will continue to gather pace in 2013, with a view to bringing the line into service in 2017 – i.e. there will be 73 months to complete all the works starting from the date of the entry into effect of the contract.

GSM-Rail. Since 2010, VINCI Concessions has been responsible for deploying and then operating the new GSM-Rail digital communication system along the French rail network under a PPP. The system provides communication capability between train drivers and control centres. In 2012 Synerail, which holds the contract and in which VINCI has a 30% interest, finalised the general design and installation studies for the 2,200 radio transmitters that will be built along the 11,000 km of track. The works are being carried out primarily by VINCI Energies. At end 2012, over 500 transmitter sites had been installed or were under construction. In 2011, Synerail also took over operation of the 3,000 km of track already equipped with the GSM-Rail system before the contract was signed, delivering excellent service quality. Rhônexpress, Lyon. Built and managed by a consortium led by VINCI Concessions under a 30-year contract, Rhônexpress, a 23 km line that connects Lyon’s Part Dieu rail station and the city’s Saint Exupéry airport in just under 30 minutes, posted an 8% increase in user rates during the first three quarters of 2012, before operation had to be interrupted for several weeks due to road works interfering with the track. A record was achieved in July, with 103,000 passengers. The very positive findings of surveys conducted with users (overall satisfaction rate of 95%) confirm the utility and reliability of the link and the attractiveness of the services offered: spacious carriages, the permanent presence of an on-board agent, information screens displaying flight schedules, and so on.

01

Belgium Liefkenshoek link. VINCI Concessions, in a consortium with CFE (a VINCI Construction subsidiary) and the Dutch group BAM, is building a 16 km semiimmersed rail tunnel in the port of Antwerp. Construction of this technically complex structure was completed in January 2013. The line will be brought into service in the summer of 2013 and will facilitate the transport of containers between the two banks of the Escaut river and help relieve traffic congestion on local transport networks. Locorail will be responsible for operation and maintenance of the line until 2050.

02

VINCI 2012 Annual Report

Business activity Concessions VINCI Concessions

63

01 At 103,000, a record number of passengers used the Rhônexpress link in July 2012. 02 Deployment of the GSM-Rail communication system, which puts train drivers in touch with ground controllers. 03 Along the route of the South Europe Atlantic high-speed rail line, open days are held regularly at the sites of the archaeological digs that are carried out before work begins.

03

64

VINCI Stadium Projects under development VINCI Concessions has made large sporting and cultural infrastructure a strategic development avenue, supported by 15 years of experience with the Stade de France. Its ambition has taken concrete form with the award of four projects in the last four years. VINCI Stadium, the subsidiary dedicated to this activity, was created in 2012. Its goal is to build a unique network of sports and cultural venues in Europe, together with an innovative operating model for this type of structure, which boosts the image of the host city and, through the right programming, can offer pleasure, comfort and emotional experiences to a very wide public. Dunkerque arena. In October 2012, VINCI Concessions signed a partnership contract for over 27 years to build and operate the new arena in the Dunkerque area. With two halls with a combined seating capacity of 10,700, the arena will contribute to the development of its two resident clubs, the USDK handball club and the BCM Gravelines Dunkerque basketball club, and serve as a new entertainment and cultural venue for the city of Dunkerque and its surrounding region. The works will be carried out by VINCI Construction France, in partnership with local companies. Upkeep and maintenance will be entrusted to VINCI Facilities. The project accounts for a total investment of €112 million. Allianz Riviera, Nice. 2012 was a year of intense activity on the Allianz Riviera project, the first of two new stadiums to be built by VINCI Concessions for the Uefa Euro 2016 tournament. Nice Eco Stadium, the VINCI Concessions subsidiary that signed a 30-year partnership contract with the city of Nice in 2011, will be responsible for operating this multisports and entertainment venue with a seating capacity of 35,000. Built by a consortium of VINCI companies and local SMEs in collaboration with architects Wilmotte & Associés, the Allianz Riviera is the first landmark structure of Var Eco Valley, a development programme declared a project of national interest. Structural works were completed by year-end for handover in 2013.

Business activity Concessions VINCI Concessions

Nice Eco Stadium has signed a naming contract with Allianz France for a total amount of €1.8 million a year for nine years, not including activation costs. Bordeaux stadium. The Stade Bordeaux Atlantique consortium, jointly owned by VINCI Concessions and the Fayat Group, signed a partnership contact for 30 years from the date of commissioning of the facility for the financing, construction and operation of the future multi-purpose Bordeaux stadium, a 40,000-seat facility that will host Uefa Euro 2016 tournament matches. The project was designed by architects Herzog & de Meuron, who also designed the Munich Allianz Arena and the Beijing Olympic Stadium. The works, worth a total of €166 million, will be carried out by the joint venture comprising VINCI Construction France (lead company) and Fayat. They started at the end of 2012, for delivery scheduled in 2015.

Stadiums under operation MMArena, Le Mans. The first stadium in France to benefit from a naming rights agreement, MMArena managed to limit the impact of the sporting and economic difficulties encountered by its resident club, Le Mans FC, thanks to the dynamism of the concession-operator model of its concession company, Le Mans Stadium, and the continued support of its partner MMA. Apart from the resident club’s 22 home matches, in its second year of operation MMArena hosted a number of major sports fixtures (including the Stade Français-Agen rugby and France-Estonia football matches), which attracted a full complement of spectators. Corporate activity was also brisk, with 25 business conventions and events organised during the year. Stade de France. Built by VINCI in the framework of a consortium and operated by a consortium in which VINCI Concessions has a 67% interest, the Stade de France once again confirmed its status as a landmark venue in 2012. It hosted highprofile sporting events: in rugby, three Six Nations matches, and the final of the Top 14; in football, the French Cup and League Cup finals, the France-Belarus and FranceJapan matches, as well as athletics meets. Other major events included concerts featuring international stars such as Metallica, Coldplay, the Red Hot Chili Peppers, Black Eyed Peas, Madonna, Lady Gaga, and so on. Since it opened in 1998, the Stade de France has welcomed over 25 million spectators. No other European stadium can boast so high a number of international sporting events hosted, including the Football World Cup and the Rugby World Cup.

01

The Consortium Stade de France has always welcomed dialogue with its long-standing partners, which are the French government and the French football and rugby federations (the FFF and the FFR, respectively). In 2010, the consortium signed an agreement with the FFF for the French national side to be able to make use of the stadium until 2025. Negotiations are under way with the FFR and the Ministry of Sport to enable the national rugby team to continue using the stadium after July 2013. The Stade de France, which has over 90,000 Facebook fans, is present on social media and followed every week by 1.6 million people.

VINCI 2012 Annual Report

Business activity Concessions VINCI Concessions

65

Outlook

02

01 The future Dunkerque arena will be an entertainment and cultural venue. 02 The Allianz Riviera visitor centre is a 175 sq. metre space that presents the project to the public, especially youngsters.

Takeover of operation of Portugal’s main airports, after completion of the acquisition process now under way, will be the major issue of 2013. VINCI Airports will tackle this responsibility with a determination to create shared value for the benefit of public authorities, partners and airport users alike. Deployment of a proactive management and commercial policy will foster growth of business in terms of routes and passenger numbers as well as airport terminal services. In Portugal, as in France and Cambodia, VINCI Airports will benefit from the steady momentum of the air transport market, which is growing at a rate appreciably higher than that of the overall economy in all countries. VINCI Concessions will also continue striving for success in all the major projects under way (the Tours–Bordeaux SEA high-speed rail line, the Moscow–St Petersburg motorway, stadiums), in an approach based on continuous dialogue with stakeholders. VINCI Concessions will seek to strengthen its positions in its long-standing business lines – road infrastructure and parking facilities – and in those where its involvement is more recent: rail infrastructure and stadiums. On the geographical level, VINCI Concessions may tackle new markets in Asia and North America. Development of joint offers with companies in VINCI’s contracting business already operating in these regions will facilitate access to these new markets – an example being the first PPP won by VINCI in the United States for a transport infrastructure project. Brownfield operations may also be studied on a selective basis to speed up VINCI Concessions’ entry into new markets. VINCI Concessions will focus on targeted marketing policies and give priority to rollout of innovative services and optimisation of networked operation in each of its activities, with the aim of sharing best practices.

Contracting 66

Business activity

VINCI Energies Eurovia VINCI Construction At the heart of the Group’s integrated model, VINCI Energies, Eurovia and VINCI Construction form an unrivalled network of expertise and companies across the world. In 2012, their 176,500 employees worked on 265,000 projects in some 100 countries. Page 68

Page 80

Page 92

Revenue

Operating income from ordinary activities

(in €m)

(in €m and as a % of revenue)

31,495

67

Business activity

VINCI 2012 Annual Report

33,090

1,435

1,403

Net income attributable to owners of the parent

Cash flow from operations (*) (in €m and as a % of revenue)

Net financial surplus (**) (in €m)

(in €m and as a % of revenue)

968

915

1,880

1,875

2,914

2,095

2011

2012

4.6%

4.2%

3.1%

2.8%

6.0%

5.7%

2011

2012

2011

2012

2011

2012

Revenue by geographical area (as a percentage)

France Central & Eastern Europe United Kingdom Germany Rest of Europe Americas Africa Rest of the world

58%

6% 7% 7% 8% 5% 5% 4%

(*) Before tax and financing costs. (**) At 31 December.

2011

2012

68

Business activity Contracting

VINCI Energies

VINCI 2012 Annual Report

Business activity Contracting

Profile VINCI Energies employs 64,000 skilled professionals, serving public authorities and business clients, helping them to deploy, equip, operate and optimise their energy, transport and communication infrastructure, industrial facilities and buildings. VINCI Energies combines expertise in its own technology areas – electrical power, heating, ventilation and air conditioning (HVAC), mechanical engineering, and information and communications technologies – with expert knowledge of its customers’ businesses. It leverages these capabilities to develop high value-added solutions to address customers’ demands for efficiency, reliability and safety. These solutions support customers throughout their projects’ lifecycle, from project engineering and execution to maintenance, operation and facilities management. Thanks to an exceptionally dense network of 1,500 companies in 45 countries, 25 of them outside Europe, VINCI Energies combines global reach with local service. As a key player in energy efficiency and renewable energy, VINCI Energies’ capacity to integrate complex systems is a key component of VINCI’s overall offer.

69

70

Business activity Contracting VINCI Energies

VINCI 2012 Annual Report

Business activity Contracting VINCI Energies

Competitive position

71

Revenue

Net income attributable to the owners of the parent

(in €m)

of VINCI Energies in its main markets

France VINCI Energies is market leader, notably due to the acquisition of Cegelec and Faceo in 2010, which enabled it to significantly broaden its geographical coverage and areas of expertise in a fragmented market in which the top six players account for only 45% of the total. The business line’s main competitors are GDF Suez Energie Services, Spie, Eiffage Energie, Bouygues Energies & Services (formerly ETDE) and SNEF. Rest of Europe VINCI Energies is one of the leading electrical engineering and installation companies in six countries: Germany (where the pace of growth increased significantly in 2012 following the acquisition of GA Gruppe), the Netherlands, Switzerland, Belgium, Portugal and Romania. Its main competitors are: - in Germany, Bilfinger Berger Power Services and Thyssen Krupp Industrial Services in insulation, Minimax in fire protection, Imtech and Siemens in electrical installation; - in Switzerland, Burkhalter and Alpiq in electrical installation and telecommunications; - in Benelux countries, GDF Suez Energie Services and Imtech.

(in €m and as a % of revenue)

8,666

2011

9,017

2012

Operating income from ordinary activities

315

327

3.6%

3.6%

2011

2012

Cash flow from operations (*)

(in €m and as a % of revenue)

(in €m and as a % of revenue)

483

502

508

532

5.6%

5.6%

5.9%

5.9%

2011

2012

2011

2012

Outside Europe VINCI Energies operates in Africa, the Middle East, Asia and the Americas. It is the leading player in the Moroccan market.

Net financial surplus/(debt) (**) (in €m)

531

Sources: company literature.

(*) Before tax and financing costs. (**) At 31 December.

(47) 2011

Revenue by business sector (as a percentage)

Infrastructure Service sector Industry Telecoms

26% 34% 31% 9%

Revenue by geographical area (as a percentage)

France Germany Switzerland Belgium Netherlands Rest of Europe Africa Rest of the world

61% 16% 4% 4% 2% 7% 3% 3%

2012

72

Business activity Contracting VINCI Energies

How would you sum up efforts to improve the safety of French nuclear facilities in the wake of Fukushima and the aging of the power plants?

Most of our nuclear power plants are approaching the 30-year mark, an age at which a number of components must be renovated or replaced even when they have undergone regular maintenance. This is what is we call a major refit. Clearly it would not be prudent to invest in such a large operation if it is only to extend the lifespan of the fleet for 10 years, so we will be aiming for 20 to 30 years. We have therefore identified – and this was done before Fukushima – the safety improvements needed at power plants when they reach the age of about 40, including the addition of a third set of electrical circuits and an additional water supply system. These changes will bring us close to a number of safety objectives specific to third-generation reactors. In light of the lessons learned from Fukushima and the recommendations of the French Nuclear Safety Authority, these changes will have to be brought forward and scheduled by 2018, in parallel with the major refit operations to be carried out on a substantial part of the facilities during the 2012-2025 period. We are preparing for this work. We cannot do it alone, of course. We need the support of a solid industrial fabric and have presented a number of projections to all our partners, including the VINCI Group.

Against that backdrop, how are EDF’s requirements expected to change?

EDF’s technical requirements will remain unchanged. The real challenge will be to cope with the retirement of a substantial portion of the workforce that built the power plants. We will have to cope with the generational transition at a time of intensive work. EDF and its partners will have an equal need to renew skills and we will all have to work together intelligently to meet this challenge. From that point of view, VINCI Energies is an important partner, though its name is less familiar in the power plants than the names of such companies as Cegelec, Tunzini and Kellal. VINCI Energies has the capacity to set up and coordinate responsive, hands-on teams and to provide the strong support they will need if they are to expand at a time when activity is sharply increasing, as it will be shortly.

What role do you think a group like VINCI can play in building new-generation power plants and decommissioning the oldest facilities? The set of core competencies in maintenance operations and upgrades that VINCI is developing for the major refit are the same as the ones that will be needed for new construction and decommissioning going forward. The partners that are currently working with us day to day will be called on in future. Third-generation reactors may constitute a technological leap and introduce new safety requirements, but to build them what is needed above all is an industrial fabric that has managed to take new skills on board.

VINCI 2012 Annual Report

73

Business activity Contracting VINCI Energies

Dominique Minière Executive Vice-President, Generation Engineering Department, EDF

“A substantial part of the workforce that built the French nuclear facilities will be retiring. The main challenge for both EDF and its partners will be to cope with the generational transition.”

74

Business activity Contracting VINCI Energies

Sound performance in markets that remain buoyant 01

In 2012, VINCI Energies recorded a 4% increase in revenue (0.9% at constant structure) and its Ebit margin held steady at an excellent level of 5.6%. Despite a more difficult economic environment, business volumes and margins were bolstered by VINCI Energies’ strong base in each of its markets.

VINCI Energies’ sound performance in 2012 substantiated the rationale for the structure formed by the combination with Cegelec in 2010 and bore out its potential. Cegelec boosted VINCI Energies’ ability to bring its entities together to offer solutions that are both local and global and that cover an unprecedented range of expertise. The introduction of a single network of business units within an integrated organisational structure was extended to France in 2012, having been completed in 2011 for the international subsidiaries and the service sector maintenance and facilities management businesses (the latter via the creation of VINCI Facilities). VINCI Energies continued to expand its business model geographically by maintaining a high level of acquisitions. The companies acquired in 2012 account for full-year revenue of €600 million, of which €580 million is generated outside France. VINCI’s largest acquisition in 2012 was GA Gruppe, with 3,000 employees and revenue of €520 million. The move substantially accelerated VINCI Energies’ expansion in Germany, its second largest market after France. VINCI Energies now generates nearly €2 billion a year in that country, where it offers its full range of business activities and holds particularly good positions in the industrial, energy infrastructure and telecommunications sectors. The year’s other acquisitions included a company in India specialising in industrial automation, giving VINCI Energies a position in a market with strong growth potential and boosting its

ability to support its industrial customers around the world. In France, despite the economic downturn from 2011, especially in the second half, volume was stable, thanks to VINCI Energies’ solid positions in industry, electricity and transport infrastructure, and telecommunications. In the other European countries, momentum was good in Germany and business remained robust in the Benelux countries, Switzerland, and Central and Northern Europe. In contrast, business contracted substantially in southern Europe, especially Portugal. Outside Europe, which accounts for 6% of revenue, there was significant growth in Morocco, mainly in electricity infrastructure and facilities management; in Indonesia, in the energy, mining and industrial sectors; and in Africa, in oil and gas infrastructure.

Infrastructure Energy

Energy infrastructure contracts accounted for business volume of €1.9 billion, i.e. 20% of VINCI Energies’ total revenue. In high voltage transmission networks, business with public transmission operator RTE in France continued at a very good level. VINCI Energies supports RTE’s major programmes to reinforce existing overhead and underground lines, as well as the construction of new lines and transformers. The main projects of 2012 included the Cotentin-Maine line built in conjunction with the construction of the Flamanville EPR (40 km of lines and a transformer) in north-western France, and the BiançonFréjus underground line in the south-eastern part of the country. In the course of the year, a series of contracts covering monitoring and inspection of networks managed by RTE were also renewed.

VINCI 2012 Annual Report

Business activity Contracting VINCI Energies 01 Cegelec Mobility teams installed a 25,000 V catenary on a 43 km rail line between Gières and Montmélian in south-eastern France. 02 The acquisition of GA Gruppe boosted VINCI Energies’ energy infrastructure and communications activities in Germany and Central Europe.

02

75

76

High voltage network activity was also buoyant in the United Kingdom, a major market in which VINCI Energies has carved out a place for itself; in the Czech Republic, where a new line is under construction; and in Morocco, in transmission lines and transformers. In Spain, the decline in activity was relatively limited due to recurring grid maintenance works under contracts renewed in 2011. In Germany, where the energy transition will entail major investments in power transmission and distribution infrastructure, VINCI Energies is now a major player following the acquisition of GA Gruppe. In medium voltage networks, work for regional and local authorities in France – VINCI Energies’ traditional core business – was affected in the first part of the year by institutional changes in the system used to finance grids in rural areas, but picked up again at the end of the year. In power generation, VINCI Energies handed over the 3 x 110 MW Kenitra power plant in Morocco in 2012 and won two similar projects in Algeria (3 x 150 MW Boutlelis power plant) and Côte d’Ivoire (110 MW turbine in Abidjan). In Indonesia, VINCI Energies is building a turnkey fossil-fired plant in Berau, Borneo. Business in the nuclear sector – threefourths of which is generated in France – amounted to about €300 million. As it has the full range of permits necessary to work in nuclear settings, VINCI Energies was able to help EDF and the other companies involved in the nuclear sector to optimise existing power plants and facilities and to carry out safety upgrades. With the business line’s network offering diversified expertise (electricity, ventilation, mechanical engineering, etc.) throughout the country, business activity is expected to remain buoyant over the long term as work is carried out to extend the lifespan of France’s nuclear power plants.

Business activity Contracting VINCI Energies

In renewable energies, the photovoltaic solar equipment activity was affected by regulatory uncertainty concerning the purchase tariff applying to the electricity produced. However, several large orders were won following the award of permits by the French Energy Regulatory Commission (CRE). In wind power, VINCI Energies built (with the exception of the turbines) Turkey’s largest wind farm in Balikesir (52 turbines, 150 MW overall), and continued the construction of a 10 MW farm in Adrar, Algeria. Lastly, the urban lighting activity held steady at a satisfactory level. Substantial urban development projects boosted demand in the major urban areas, offsetting the activity slowdown in rural areas. During the year, 11 new public-private partnership (PPP) and energy performance contracts covering a total of 25,000 lighting points were signed. In this market, VINCI Energies business units made the most of their ability to provide comprehensive solutions with specific energy consumption reduction commitments of 40% or more over the contract period.

01

In the rail sector, the SEA Tours–Bordeaux high-speed rail line project was ramped up in France. VINCI Energies is the lead company of the sub-consortium in charge of energy equipment. In Morocco, Cegelec was awarded the contract to implement the power supply system on the future high-speed line between Tangier and Casablanca.

Transport

Industry

In the transport infrastructure sector, business activity made considerable strides in 2012, coming in at over €0.5 billion or almost 6% of VINCI Energies’ revenue. In the airport sector, VINCI Energies completed the comprehensive equipment (including the security and passenger flow management system) of the new Satellite 4 at Paris Charles de Gaulle Airport. Urban transport activity expanded substantially in France as metropolitan areas accelerated projects in the run-up to municipal elections in 2014. VINCI Energies business units took part in a large number of light rail projects (including Bezons-La Défense, Brest, Le Havre, Lyon, Montpellier, Toulouse, Tours and Casablanca, Morocco) as well as urban tunnel renovation projects. The latter included the A14/A86 tunnels at La Défense, Paris and work in synergy with other VINCI business lines on the Saint Cloud (A13) tunnel and the Les Halles tunnel, also in Paris. Similar synergies were called into play in the rehabilitation and capacity upgrade of the Croix-Rousse tunnel in Lyon. Projects on the VINCI Autoroutes networks generated substantial activity as well, with work on the last section of the A89 motorway toward Lyon (including rollout of electromechanical equipment and operating systems in the 5.7 km of twin-tube tunnels) and equipment installation for several dozen new 30 km/h electronic toll collection lanes at the network’s main toll plazas.

At variance with the general industrial market trend, especially in France, 2012 was a year of growth for VINCI Energies in the industrial sector. Revenue came in at €2.8 billion, or 31% of the business line’s total volume. The integration of Cegelec enabled VINCI Energies to round out and broaden its already comprehensive offering for the industrial market and to increase its ability to operate as general contractor. By networking its teams and expertise, the business line was able to expand its variable-geometry solutions in terms of geographical coverage, expertise (electrical energy, HVAC, mechanical engineering, monitoring and control, etc.) and project life cycle (engineering, implementation, maintenance). This approach meshes with the trend towards offering comprehensive technical services for industrial customers and with the growing demand for multi-site and multi-country solutions. For example, VINCI Energies supported Renault by supplying and commissioning production lines at the automaker’s Tangier, Morocco, Togliatti, Russia, and São Paulo, Brazil sites. In Brazil, local and European business units worked together to win a new contract from aerospace company Embraer. Similar synergies were leveraged to support Michelin, a long-standing VINCI Energies customer in France, in the construction of its new tyre plant in Shenyang, China; and VINCI Energies Deutschland capitalised on its work

VINCI 2012 Annual Report

01 The FrieslandCampina dairy company awarded the contract to expand its plant in Aalter, Belgium to Actemium. The contract covers design and construction of a new production unit that will double the site’s capacity. 02 As part of the Coeur de Cité urban renewal operation, Citéos and Cegelec are implementing the public lighting system in the French city of Roanne.

02

Business activity Contracting VINCI Energies

Working together is a winning proposition for Actemium The German Actemium Project Management business unit and the British Actemium East Midlands business unit together won an Iggesund Paper Mill contract in September 2012, under which they will work together to design, install and commission the instrumentation of a new energy production unit (a 50 MW

77

biomass-fired power plant) at the Workington site in the United Kingdom by mid-2013. Actemium PM is in charge of designing the instrumentation solution and of project management. Actemium East Midlands, for its part, will carry out the installation in accordance with the UK’s Construction Design and Management (CDM) regulations, which define health and safety obligations to be complied with by every construction project.


for German customers operating in Kazakhstan to create a new entity that will roll out its mining equipment expertise in that major mining country. The most buoyant industrial sectors in 2012 were aerospace, food and beverage, chemicals, pharmaceuticals, environmentrelated industries, and oil and gas. New contracts won during the year included: in France, extension of the Occitane cosmetics plant in Manosque, Provence, and maintenance at the Arkema chemicals site in Normandy (a three-year comprehensive maintenance contract) and at the Total Group refinery in the same region (a six-year contract renewal); in the United Kingdom, the new biomass-fired power plant at the Iggesund Paper Mill in Workington (see above); in Switzerland, several sites belonging to pharmaceutical groups Roche and UCB; in Germany, the underground gas storage tank in Jemgum in the north of the country; and in Nigeria, comprehensive maintenance at Total’s Usan offshore floating production and storage facility.

Service sector In the service sector, where markets change more slowly than in the industrial sector, VINCI Energies’ business volume remained stable overall in 2012, at €3 billion, accounting for 34% of the business line’s total revenue. In France, business declined outside the Greater Paris area as a result of public spending cuts, but this was offset by strong growth in Greater Paris itself. VINCI Energies business units are able to capitalise on their ability to take on major projects under contracts that include the full range of technical trades. Projects carried out in synergy with VINCI Construction generate a significant share of business in this sector. In 2012, these included the Eqho and D2 high-rise buildings in Paris-La Défense, the Louis Vuitton Foundation for Creation and the Peninsula Paris luxury hotel. Also included was the future SFR head office in Saint Denis, where six VINCI Energies business units are

78

Business activity Contracting VINCI Energies 01 Thales once again chose VINCI Facilities to provide facilities management at its 47 sites in France for a period of five years. 02 Cegelec implemented all fluids works packages at the high-rise, HQEcertified Sofitel Casablanca hotel in Morocco. 03 In northern Poland, Graniou ATEM is involved in providing nearly 100,000 households with very high-speed connections.

in charge of the HVAC, high current, low current and plumbing works packages. In the healthcare sector, business also held steady at a high level. The main projects already under way or starting up in synergy with VINCI Construction were hospitals: Toulouse (Rangueil), Lyon (Le Vinatier), Chambéry, Fort de France in Martinique; and the Koutio hospital complex in Noumea, New Caledonia. In the rest of Europe, business was buoyant in VINCI Energies’ two main service sector markets outside France. In Belgium, Cegelec is installing the comprehensive electrical and climate control equipment at the new Nato headquarters and the new headquarters building for the European Council in Brussels; and significant orders were also taken in the healthcare (GSK site in Wavre) and security (new Beveren prison) sectors during the year. In Switzerland, Etavis took part in the construction of the new Rolex site in Bienne, the country’s largest. Outside Europe, the year’s projects included the Sofitel high-rise hotel in Casablanca, Morocco and the Fonte Nova stadium in Salvador de Bahia, Brazil, being built in the run-up to the 2014 Fifa World Cup.

Maintenance and facilities management After VINCI Facilities was set up in 2010, VINCI Energies extended the rollout of the strong brand common to all its multi-technical building maintenance and facilities management business units. VINCI Facilities’ revenue grew 6% in one year to €1.3 billion in 2012, accounting for 15% of VINCI Energies’ total business activity. As is the case in the works activities, the multi-site and multi-country maintenance and facilities management offerings build on technical synergies with the other VINCI Energies divisions to meet the needs of major contracting authorities. For example, VINCI Facilities began working with the Société Générale bank under a framework agreement covering its Paris-area properties (about 20 sites under management in 2012), and that agreement is now being extended to a number of other European countries. Many other multi-site and multi-country contracts were won or renewed in 2012 for customers in the banking (BNP, Dexia, Natixis), industrial (Thales, EDF) and services (Fedex) sectors.

01

VINCI Facilities also works under PPPs in Germany, where its business units handle comprehensive maintenance (including construction and renovation works) of schools and US Army bases. In France, VINCI Facilities will take on the maintenance of the Nice and Bordeaux stadiums under PPPs won by the Group.

Telecommunications Communication networks and systems generated €0.8 billion in revenue, i.e. 9% of VINCI Energies business activity.

02

Infrastructure Telecommunication network design, construction, equipment, maintenance and operational support, carried out under the Graniou brand, continued at a buoyant level as smartphones, exponential growth of equipment use and the advent of uninterrupted connectivity generated a need for steadily increasing network capacity and performance. In mobile networks, the momentum is driven by the transition – starting in 2012 and set to accelerate in coming years – to the new 4G standard in most European countries. In fixed-line infrastructure, momentum is driven by optical fibre connections to homes and businesses (Fibre To The Home and Fibre To The Site), and in mobile networks by the need to increase bandwidth between antennas. In France, the arrival of a fourth mobile operator in the first half of the year disrupted the market, prompting the existing operators to re-think their investment programmes and exacerbating price pressures. Against this backdrop, VINCI Energies stepped up its efforts to expand its network maintenance activity and signed several substantial contracts with SFR and Orange. This helped to keep business at the same level as in 2011. Under a PPP won mainly by VINCI, VINCI Energies also continued to roll out the new GSM-Rail railway communication system that will cover 14,000 km of lines on the French rail network by 2015.

03

VINCI 2012 Annual Report

Business activity Contracting VINCI Energies

79

Outlook

In the international marketplace, VINCI Energies established a position in the German telecommunications market with the acquisition of GA Gruppe, which generates annual revenue of some €80 million. The year was also a good one in Sweden, Switzerland and Poland, where Graniou is building a major backbone in Pomerania.

Business communications Under the Axians brand, VINCI Energies offers network integration, voice-data-image communications and integrated management services for companies and public authorities. This activity, spread across six European countries, continued to grow in 2012, especially in Germany, where Axians rolled out the full complement of active equipment for one of the world’s largest Internet exchange points for DE-CIX in Frankfurt. In France, it ramped up the contract with the UniHA cooperative network covering IT infrastructure maintenance (switch, routers, WiFi, videoconferencing) at 34 hospitals. In the Netherlands, Axians won the Nikon contract to overhaul the architecture of its European networks. In Switzerland, Axians refurbished the secure IT infrastructure at the Felix Platter hospital in Basel. Axians also established a presence in Morocco in synergy with the other local VINCI Energies business units. In all its markets, Axians is expanding its data storage and outsourced service offerings to support the increasing use of cloud computing in the business world.

VINCI Energies’ order book at the end of 2012 amounted to €6.8 billion, up 5% over a 12-month period, pointing to a stable level of activity in 2013 compared to the previous year. The broad array of VINCI Energies’ business sectors, the range of its activities and its geographical reach, backed by its determined drive to expand internationally, are expected to underpin this trend. Thanks to its robust model, VINCI Energies has the capacity to respond swiftly and appropriately to contrasting trends in its different markets, aided by the strong ties and solidarity between its companies. In the medium and long term, demand for VINCI Energies’ businesses will remain strong because they are central to many of the major issues facing society. Infrastructure. VINCI Energies is actively involved right across the energy industry and will therefore benefit from major investments in the construction and renovation programmes to boost network capacity and deploy smart grids, and in production facilities, at a time of rapid change in terms of electricity production sources and increasing recourse to renewable energy. Transport infrastructure programmes, meanwhile, will showcase the Energy business line’s expertise, especially through integrated projects involving the VINCI Group as a whole. Industry. Programmes to upgrade existing facilities in mature economies, together with investment in new manufacturing plant in emerging economies, where VINCI Energies is now expanding rapidly, will stimulate business activity. VINCI Energies will leverage its presence and knowledge of processes in the fastest-growing sectors

such as the food and beverage industry, as well as in pharmaceuticals, aerospace, oil and gas, and environmental services. It is supporting its industrial customers in their international growth, thanks to its geographical coverage. Service sector. Demand for energy efficiency will give a powerful boost to investment in the construction of new low-energy buildings, and in improving the insulation of existing buildings. Investment in public amenities such as healthcare, educational, sports and cultural facilities, along with “smart” office buildings and technical buildings such as logistics bases and data centres, etc. will further spur activity. Increasing demand for integrated facilities management solutions, additional to construction and renovation activities, will allow VINCI Energies to expand its market coverage. Telecommunications. Ultrafast broadband, connectivity everywhere and the growth of services demanding ever more bandwidth implies continuous investment in expanding and upgrading networks. This will apply to other businesses as well, where VINCI Energies is developing new comprehensive networks and systems management and data storage solutions to keep pace with its customers’ needs. Synergies with the other VINCI business lines will be an additional growth driver in most of these markets.

80

Eurovia

Business activity Contracting

VINCI 2012 Annual Report

Business activity Contracting

Profile Eurovia is a world leader in transport infrastructure and urban development. While continuing to nurture its strong roots in France, international operations account for 41% of its revenue, primarily in Western and Central Europe, North America, Chile and India. Transport and urban development infrastructure. Eurovia builds and upgrades roads and motorways, rail and light rail systems, as well as airports and industrial and retail complexes. It also possesses know-how in related areas, including demolition and deconstruction, drainage, earthworks, roadways and utilities, urban renovation, civil engineering structures and noise barriers. Quarries. Eurovia is a European market leader in aggregates, and extracts, processes and markets both natural and recycled aggregate. It operates a network of more than 400 quarries producing 86 million tonnes of aggregate annually (Eurovia’s share is 69 million tonnes), and 150 materials recycling and recovery facilities. Eurovia’s reserves (*) represent more than 49 years of output (it controls more than 3.4 billion tonnes of reserves of aggregates). Industrial production. Eurovia operates a network of 47 binder plants and 375 hot mix plants supplying 22 million tonnes of asphalt annually. A further 10 factories produce equipment, including road signage (panels, overhead sign gantries and paint) and industrial and retail floorings (resins), along with concrete and pre-fabricated products such as noise barriers. Services. Eurovia provides management and maintenance of road systems under long-term contracts, as well as services relating to ancillary equipment such as vertical and horizontal signage and safety equipment, and maintenance of all connected structures, e.g. public lighting, traffic signals, amenities, green spaces and vegetation. Eurovia invests heavily in research and development of products and processes to protect the environment, including materials recycling and cutting CO2 emissions. (*) Reserves controlled through ownership or royalty agreement.

81

82

Business activity Contracting Eurovia

VINCI 2012 Annual Report

83

Business activity Contracting Eurovia

Competitive position

Revenue

Net income attributable to the owners of the parent

(in €m)

of Eurovia in its main markets

(in €m and as a % of revenue)

8,722

France In the road and rail sector works market, Eurovia holds second place behind Colas and ahead of Eiffage Travaux Publics. The fragmented market is otherwise shared by about 1,500 local and regional contractors. Eurovia is market leader in aggregates, where its competitors include Colas and cement groups such as Lafarge, Ciments Français, Cemex and Holcim, alongside some 1,500 other local producers. Germany Eurovia GmbH is number two behind Strabag. The other players are regional in scope. Czech Republic Eurovia CS is among the leaders in road and rail sector works. Its main competitors are Skanska, Metrostav and Strabag. United Kingdom Eurovia subsidiary Ringway is a major player in long-term maintenance contracts. Its main competitors are Carillion, Amey and Jarvis. North America The Hubbard Group, a Eurovia subsidiary, ranks number two in the south-eastern United States behind Archer Western Contractors. In Canada, subsidiary DJL is in second place in Quebec province after Sintra, a subsidiary of Colas. Following the acquisition of Carmacks, Eurovia became a major player in the province of Alberta in 2012.

8,747

220

167

2011

2012

Operating income from ordinary activities

2.5%

1.9%

2011

2012

Cash flow from operations (*)

(in €m and as a % of revenue)

(in €m and as a % of revenue)

322

277

524

467

3.7%

3.2%

6.0%

5.3%

2011

2012

2011

2012

Net financial surplus/(debt)(**) (in €m)

90

(136)

(*) Before tax and financing costs. (**) At 31 December.

2011

Revenue by business sector (as a percentage)

Quarries Industrial production Services Works

9% 13% 5% 73%

Revenue by geographical area (as a percentage)

France Germany United Kingdom Central Europe Rest of Europe Canada Rest of Americas Rest of the world

59% 10% 4% 12% 2% 6% 5% 2%

2012

84

Business activity Contracting Eurovia

The London Borough of Hounslow awarded a consortium comprising VINCI Concessions and Ringway, Eurovia’s UK subsidiary, the upgrade, repair and maintenance of its highways network for a period of 25 years. The consortium will invest €125 million in the project. What is the aim of this contract? What is special about it?

Our streets are generally in poor condition as we’ve made other investments over the last 20 to 30 years. Our purpose is to make the streets of Hounslow fit for the 21st century. It’s a quite complex contract and a long-term investment based on a Private Finance Initiative (PFI). Our partner, VINCI Concessions and Ringway, will be borrowing €125 million, with the majority invested in the first five years of the contract. This investment puts the borough in a very strong position to be able to improve almost all of the streets in Hounslow for the benefit of our 250,000 residents. During this core investment period, VINCI Concessions and Ringway will be upgrading the entire street infrastructure: roads, footpaths, streetlights, signs, trees, and so on. Beyond the initial period, VINCI Concessions and Ringway will then be maintaining everything for another 20 years up to the required standards.

How can the London Borough of Hounslow Council measure these standards?

Under the contract, there are about 300 indicators on which the performance of VINCI Concessions and Ringway is judged during 25 years. They concern the whole range of services such as the condition of the highways and pavements, condition of the street lighting, which has to be brought up to standard, the removal of graffiti, the cutting of the grass verges along the streets, and so on. During the first five years, there are a number of milestones that VINCI Concessions and Ringway will have to achieve, and we are confident that they will meet these standards following an exhaustive process to agree the contract.

What criteria influenced your decision in favour of VINCI Concessions and Ringway?

We went through a very rigorous procurement exercise, choosing VINCI Concessions and Ringway as our partner for several reasons. Firstly, the quality of the bid they made. In particular, they bring their know-how and experience. They also bring innovation in terms of use of materials that will greatly improve the appearance of our streets. They have also been involved with this local authority for a long time, as they have been working on a contract with Hounslow for over 20 years. The council very much liked the quality and the ideas they brought to the project. Although they are a multinational company, we appreciated their understanding both of the kind of service we provide our local communities and of what the people want out of a local highways service.

VINCI 2012 Annual Report

85

Business activity Contracting Eurovia

Brendon Walsh

Director of Regeneration, Economic development and Environment, London Borough of Hounslow

“The investment by VINCI Concessions and Ringway will improve almost all the streets in Hounslow for the benefit of its 250,000 residents.”

86

Business activity Contracting Eurovia

Resilience in Europe, strong growth in the Americas Eurovia’s revenue increased a slight 0.3% to €8.75 billion. On a like-for-like basis, it declined 4.5%. The diversity of the business line’s activities and markets helped ensure overall stability in an economic environment that was more difficult than in 2011. The French market held steady while growth in the UK, Canada and Chile, which account for about threequarters of business volumes, more than offset the contraction recorded in the rest of Europe, especially in Germany and Central and Eastern Europe.

under way in this business activity. In France, 72% of Eurovia’s wholly owned and majority held quarries have signed the environment charter of UNICEM, France’s national federation of quarry and construction materials industries. At the end of 2012, 58% of quarry production, 24% of coating plant production and 83% of binder plant production were ISO 14001 certified. The environment is also a defining focus of the business line’s innovation policy. Eurovia’s laboratories are developing products and processes that reduce the impact of its activities, notably by reducing the temperatures at which asphalt mix is produced and laid, and by widespread use of recycling.

01

02

France Applying the Group’s international development strategy, Eurovia extended its positions in markets outside Europe that constitute growth drivers. In Canada, it acquired Carmacks (€212 million revenue in 2012), thereby gaining a foothold in the province of Alberta, which has vast oil resources, and rounding out the positions previously developed in Quebec and British Columbia. Eurovia generated revenue of €0.6 billion in Canada, which is now its third largest market after France and Germany. The year’s other substantial acquisition was in India, where Eurovia took over NAPC, which generates close to €100 million in revenue. Headquartered in Chennai, in the state of Tamil Nadu, India’s fifth largest economic region, the company is a regional leader in its sector. NAPC provides roadworks, earthworks and civil engineering. It is notably part of the concession consortium that is currently building the Chennai ring road. In materials production, Eurovia completed the integration within its Eurovia Stone division of some 100 quarries acquired from Tarmac in 2010. This gives Eurovia an integrated materials production industry, which is being globally structured as a fully fledged business activity within the business line, where it contributes to revenue growth while securing supplies for the worksites. The environment is part and parcel of the improvement programme

Eurovia proved resilient in its main market in 2012. Against a backdrop of budget cuts by local and regional authorities and despite the unfavourable weather conditions in the first half, revenue held steady at €5.2 billion, similar to that in 2011. Investment continued at a high level in large urban areas, offsetting the economic slowdown in most of France’s rural departments. Volume was high in the motorway sector in 2012, with the extension of the A89 motorway towards Lyon, for which Eurovia laid 450,000 tonnes of asphalt mix on a 35 km section; widening of the A63 motorway near the Basque coast (of which the first phase was completed), the A50 motorway between La Ciotat and Bandol, the A8 motorway at the western entrance to Nice and the A9 motorway in the outskirts of Perpignan; and construction of the Gatignolle interchange on the A11 motorway at Angers. Eurovia’s network of divisions contributed to the completion of a large number of green motorway package projects by the spring of 2013. These included construction of noise barriers, renovation of rest areas, overhaul of toll stations to accommodate new no-stop lanes, etc. Eurovia also dismantled facilities along the A1 and A4 motorways. In roadworks, business activity was driven by the usual number of upgrade and maintenance projects on national,

03

VINCI 2012 Annual Report

01 EJL refurbished the Rue de Rennes in Paris. The aim of the project was to enhance safety for pedestrians and facilitate deliveries in this busy shopping street, which is used by 3,200 pedestrians and 700 vehicles an hour in peak periods. 02 Eurovia operates more than 400 quarries around the world, producing 86 million tonnes of aggregate a year. 03 As part of the refurbishment of the Lyon–Grenoble–Marseille rail line, ETF carried out works to renovate 9 km of track in 2012.

departmental and municipal roads. For example, Eurovia won a €4.8 million four-year contract to renovate and maintain the municipal roads and streets on the island of Belle Ile en Mer off the west coast of France. In light rail systems, business continued at a brisk pace. Building on the local roots of its works divisions and the expertise of its railway division, Eurovia provides services including infrastructure, street, track and ancillary works. Eurovia took part in light rail projects in the Greater Paris area (T1, T2, T3, T6, T7, T8) and in Besançon, Bordeaux, Brest, Dijon, Le Havre, Lyon, Montpellier, Nice, Orleans, Strasbourg, Toulouse and Valenciennes. On the Brest project, handed over in June 2012, Eurovia was in charge of all infrastructure and track works over 14.3 km of lines and 27 stations (see p. 6). Apart from light rail lines, urban upgrade works were stepped up in the run-up to the municipal elections. The main projects included: in Paris, work on the Rue de Rennes and the Quai Anatole France as part of the construction of pedestrian zones on the banks of the Seine; in Marseille, renovation works in the Old Port, the Boulevard National and the public area surrounding the Mucem (Museum of European and Mediterranean Civilisations); in Calais, renovation of the public spaces in the northern part of the city; in Toulon, renovation of some 15 streets and squares in the city centre; in the Charente-Maritime department, renewal of the Royan, Saint Georges de Didonne and Fouras seafronts. Also noteworthy was the 21-year public-private partnership (PPP) signed with

Business activity Contracting Eurovia

87

Eurovia embraces biodiversity In an extension of its 2011 commitment to France’s national biodiversity strategy (SNB), Eurovia signed a partnership with the National Natural History Museum, the biodiversity expert recognised by public institutions and non-governmental organisations alike. For a period of three years, the museum will support Eurovia’s deployment of a biodiversity project in its quarries, including site review and inspection, action

the municipality of Saint Leu la Forêt in northern France, under which Eurovia is designing, financing and executing works, and is then tasked with maintenance for the duration of the contract. Eurovia also worked on road tunnel projects, for the most part in synergy with the Group’s other works divisions, particularly in the Greater Paris area (refurbishment of the tunnels under Les Halles in Paris, installing a cover over the A6b motorway). In rail infrastructure, in addition to light rail, activity was buoyant on the French rail network. Eurovia took part in renovation programmes on the Paris-Lyon line and the regional Toulouse-Tessonière and LyonGrenoble-Marseille lines. The Eastern high-speed line (phase 2) between Metz and Strasbourg was also launched in 2012. It will require 470 km of track, 1 million tonnes of ballast and 400,000 sleepers. Eurovia has developed new methods for this project that reduce the need for handling and improve productivity. These methods can subsequently be used on the SEA Tours–Bordeaux HSL project, for which Eurovia initiated the first works in 2012 to divert the line and prepare for the construction of tracks and overhead lines. Actual construction will get under way in 2014 and take two years to complete. Eurovia also worked on airport projects such as the Nice Côte d’Azur Airport (refurbishment of the north runway, maintenance of seawalls) and Bergerac airport. In addition, it contributed to the refurbishment of the ports of Victor and Issy les Moulineaux in the Greater Paris area, in synergy with VINCI Construction and VINCI Energies. Lastly, there was good growth in two of its specialist business lines: signalling by Signature (now a wholly owned subsidiary following the reorganisation with Plastic Omnium of 35% of its business activities) and deconstruction by Cardem. The latter develops integrated solutions (engineering, consultation with local residents, selective

plan evaluation and monitoring, introduction of biodiversity indicators and employee training. Eurovia, meanwhile, will make its quarries available to the museum for studies to gain knowledge about biodiversity: species inventories, comparative environmental evolution analyses, and monitoring of ecological rehabilitation carried out when quarry operations are discontinued.

dismantling, materials recycling), which were used in asbestos removal and building demolition projects of all types, including a 12-storey building in Nanterre, a prison in Le Havre, a foundry in northern France and the Loire sur Rhône conventional thermal power plant, under a €30 million contract.

Western Europe Germany

After reaching an exceptionally high level in 2011, revenue generated by Eurovia GmbH contracted 2.8% in 2012 to €0.9 billion, notably due to reorganisations in a number of difficult regional markets and a substantial decline in the sale of asphalt mix. Business remained brisk in the A-Modell concession projects with the continuation of the A5 motorway renovation and extension project (Offenburg–Karlsruhe, 60 km) and the start of the A9 motorway project covering a 46.5 km section between Berlin and Munich, which includes 19 km to be widened to three-lane dual carriageway. The main contracts under way or won during the year included the construction of the new Schwanebeck motorway interchange north of Berlin; the conversion of the railway station square and access streets in Marburg, Hesse; restructuring of the technical services facility for the public transport network in Leipzig, Saxony; and, in the same Land, installation of passive safety equipment (crash barriers) along three sections of the A14 motorway. In addition, on two motorway sections in Greater Hamburg and, for the first time in Germany, Eurovia trialled its innovative pollutionreducing NOxer® surfacing process, which neutralises nitrogen oxides (NOx) emitted by vehicles.

88

Business activity Contracting Eurovia 01

Central Europe

Czech Republic and Slovakia

United Kingdom At Eurovia Group Ltd, revenue increased 5.7% to €0.4 billion. Work carried out under multi-year service contracts, which account for nearly three-quarters of total volume, was particularly buoyant due to the entry into force of five contracts won at the end of 2011. These were for road infrastructure maintenance in North Yorkshire, Shropshire, Cheshire West (including the city of Chester), Cheshire East and Essex. The total value of the contracts, covering periods of between five and 10 years, is in excess of €1.7 billion. There was further growth in this market in 2012 thanks to two Public Finance Initiative (PFI) contracts won in synergy with VINCI Concessions for the renovation and maintenance of road networks, both for a period of 25 years. The first is with the London Borough of Hounslow (432 km of roads and 763 km of pavements; total contract value: about €800 million); the second covers the highways network on the Isle of Wight (821 km of roads and 767 km of pavements; total contract value: €750 million). The first contract came into force in January 2013; the second is expected to start in April 2013. In addition, Eurovia Group Ltd won a works contract to build a new 1.6 km road link in the city of Rotherham, South Yorkshire.

Spain Against a backdrop of ongoing economic crisis, revenue fell 36% to €0.1 billion. The increasing number of multi-year motorway maintenance contracts, particularly in Andalusia, helped to limit the fall in activity.

Eurovia CS’s revenue fell 42% to €0.6 billion due to the depression in the Czech market and to the PR1BINA expressway in Slovakia reaching its final phase. On this motorway, built by VINCI under a PPP contract, the work carried out in 2012 – amounting to €82 million, down from €367 million in 2011 – involved construction of the Banska Bystrica bypass. This fourth and last section was opened to traffic during the summer. Eurovia CS also won a significant new contract as part of a consortium with VINCI Construction to build a 9.5 km section of Slovakia’s D1 motorway. The work, including the construction of a twin-bore tunnel and 12 crossings, has a total value of €127 million.

Poland Eurovia Polska’s revenue declined 24% to €0.3 billion. This is attributable to the slowdown in the Polish economy following several years of very strong growth, cuts in public spending and difficulties experienced by companies in the sector to obtain payment for works performed. The highlight of the year was the completion, on schedule and within a very tight deadline, of a 30 km section of the A2 motorway, which was opened to traffic in time for the Uefa Euro 2012 football tournament (see p. 89), and the simultaneous handover, a month ahead of schedule, of a 20 km section of the S5 expressway between Gniezno and Poznan. Eurovia Polska also won a new contract to build two sections of the Katowice–Gliwice expressway, including two viaducts, a tunnel and a bridge. In other Central and Eastern European markets (Croatia, Lithuania, Romania), revenue increased over 50% to €0.1 billion, primarily as a result of a new contract to build a wind farm for GDF Suez Energy in Romania (construction of 15.5 km of roads, foundations and cable installation for 21 turbines), in an extension of a project of the same type previously carried out by Eurovia. In Lithuania, a first project was won in the rail sector. It covers the comprehensive renovation (tracks, bridges and tunnels, platforms, signalling) of a 25 km section between Palemonas and Gaiziunai.

02

VINCI 2012 Annual Report

01 Renovation of a section of the A40 motorway near Essen, North Rhine-Westphalia, Germany. 02 Working at night to build the A2 motorway (see opposite).

Business activity Contracting Eurovia

Poland: high-speed motorway project In May 2011, as a result of accumulated delays on the worksite, the Polish government withdrew from the contract it had signed with a Chinese company to build a section of the A2 motorway, which was to be opened to traffic in time for the Uefa Euro 2012 football tournament. The consortium made up of Eurovia Polska (lead

company) and Warbud (VINCI Construction) took over the project, on which a mere 10% of the work had been completed. Operating around the clock, seven days a week, with the exception of the coldest days in the winter, 2,500 employees worked on the project, placing an average of 40,000 cu. metres of backfill and 7,000 tonnes of asphalt mix a day. The new 30 km section was opened to traffic on 31 May, just in time for the start of Euro 2012.

89

90

Business activity Contracting Eurovia

01

Americas Canada

Eurovia’s business activity in Canada more than doubled to €0.6 billion, driven by both acquisitions and organic growth. Eurovia’s major acquisition of the year, in March, was Carmacks. Based mainly in Alberta, where vast tar sands supply two-thirds of Canada’s oil production, Carmacks operates in oil services, roadworks and urban network maintenance. In Edmonton, the capital of Alberta, it manages a section of the ring road under a 30-year contract, providing not only infrastructure repairs but also winter maintenance and traffic management. Two further contracts of the same type are under way in Calgary. Business growth was particularly strong in Quebec (up 32%) where the booming economy enabled subsidiary DJL to take advantage of its ability to cover all market segments. DJL also enhanced its market coverage by acquiring Pavage Rolland Fortier in Quebec City. The year’s major projects included renovation of the main runway at Montreal-Trudeau Airport, and the contract to build a new public transport system (Rapibus project) in the city of Gatineau. There was also strong business growth (37%) in British Columbia, Eurovia Canada’s third largest market. Taking advantage of the economic momentum in the Greater Vancouver area, subsidiary BA Blacktop participated in, inter alia, the motorway upgrade of Highway 1 on the outskirts of Vancouver. It was also selected by the city of Surrey to build the major Combo project. The €54 million contract covers the design-build of road infrastructure and three bridges across a railway corridor leading to the Port of Vancouver.

United States Operating primarily in Florida and North Carolina, Eurovia recorded 16% growth in revenue to €0.3 billion following a difficult year in 2011. Although the business environment remained sluggish, Eurovia’s subsidiaries were able to capitalise on their ability to handle major design-build projects. In Florida, Hubbard refurbished I-90, the motorway that crosses Nassau County, and began construction of 21 km of Express Lanes (toll lanes built in the central reserve

of an existing motorway) on I-95 in Miami. Again in Florida, Tampa Pavement Constructors, a subsidiary acquired in 2011, carried out a highway renovation project involving 40,000 tonnes of asphalt mix on SR60 in Plant City. In North Carolina, Blythe began construction of a new 8.5 km section of the I-485 motorway, including earthworks and construction of 17 bridges and tunnels. It also renovated 48 km of roads in Davidson County.

Chile Business continued to grow steeply, up 60% in 2012, thanks to the development of two of Eurovia’s two business lines there. In roadworks, the creation of new locations in the Puerto Montt region in the south of the country and in the mining regions of the north enabled Eurovia to take advantage of the country’s economic vitality – Chile has one of Latin America’s highest growth rates. Subsidiary Bitumix continued two major projects in the north of the country: one in the Antofagasta region (surfacing of 45 km of motorway) and the other in the Atacama desert (refurbishment of a 25 km section of the Pan-American Highway). In road materials, bituminous binder production and trading also recorded strong growth, driven in particular by the new terminal set up by subsidiary Probisa in the industrial port of Mejillones, to the north of Antofagasta.

India NAPC, the construction and civil engineering company based in Chennai, Tamil Nadu, was acquired in early 2012. Its integration within Eurovia continues apace. In 2012, the company won two contracts in the state of Odisha: construction of a 45 km road, together with mining and earthworks, for an initial period of three years.

01 In the Antofagasta region, 1,400 km from Santiago, Chile, Bitumix laid the surfacing on 45 km of the motorway network currently under construction. 02 Acquired in early 2012, NAPC in India is building a 45 km road in the state of Odisha.

VINCI 2012 Annual Report

Business activity Contracting Eurovia

91

Outlook

02

Eurovia’s order book at the end of 2012 was €6.4 billion, a rise of 10% over the previous year. The increase stems primarily from the inclusion of multi-year contracts gained in the United Kingdom and the order books acquired with the new subsidiaries Carmacks in Canada and NAPC in India. Eurovia expects a slight contraction in business activity in 2013. At a time of pricing pressure and public spending cuts, in Europe especially, its priority will be to optimise its operational performance and adapt its organisation to market trends, in order to preserve its margins. Business activity in France is, however, expected to hold up well overall, with the municipal and other local government elections in 2014 acting as an incentive to rapid completion of programmes currently in hand. Strong demand in the rail sector, with ongoing work on a large number of urban transport infrastructure projects and the ramping up of work on the high-speed lines between Tours and Bordeaux (LGV SEA) and in eastern France (LGV Est), will also sustain activity. Elsewhere in Europe, good growth in the United Kingdom should partly offset flat or falling demand in other countries, especially those of Central and Eastern Europe. Diversification in rail-related businesses represents a significant avenue for mediumterm growth in these markets. Business activity outside the European Union is expected to remain brisk, as Eurovia reaps the benefit of its new positions in India and its extended scope in Canada. Looking further ahead, a number of deeplying trends in all its markets will contribute to Eurovia’s future development. These include the huge demand for new transport infrastructure in emerging markets and the need to upgrade existing infrastructure in mature economies. Expanding cities everywhere, combined with policies to improve urban mobility, will generate a constant stream of new development projects. As public spending comes under greater pressure, recourse to public-private partnerships (PPPs) will help make these projects possible, contributing to Eurovia’s growth, and ever-greater synergies with VINCI’s other divisions will speed this process.

92

Business activity Contracting VINCI Construction

VINCI Construction

VINCI 2012 Annual Report

Business activity Contracting VINCI Construction

Profile VINCI Construction, France’s leading construction company and a major global player, brings together 1,000 consolidated companies with more than 71,000 employees in some 100 countries and delivers a comprehensive array of capabilities in building, civil engineering, hydraulic engineering and contractingrelated specialities. The distinctive feature of VINCI Construction, beyond its broad range of expertise, is its business model based on three components that form an excellent strategic fit. Networks of local subsidiaries: - within France: VINCI Construction France, comprising 467 profit centres with strong regional roots in mainland France; and VINCI Construction DOM-TOM, comprising about 30 local subsidiaries in overseas France; - outside France: VINCI Construction UK in the United Kingdom; CFE (in which VINCI holds a 46.8% interest) operating mainly in the Benelux countries; Warbud, Prumstav, SMP, SMS and APS Alkon in Central Europe; and Sogea-Satom in Africa. Specialised civil engineering subsidiaries serving global markets: Soletanche Freyssinet (foundations and ground technologies, structures, nuclear activities); Entrepose Contracting (oil and gas infrastructure); DEME, in which CFE holds a 50% interest (dredging, marine engineering, site remediation, offshore activities and wind turbines). A division dedicated to complex project management and execution: VINCI Construction Grands Projets, VINCI Construction Terrassement and Dodin Campenon Bernard, which work on major civil engineering and building projects around the world. VINCI Construction exemplifies the Group’s entrepreneurial culture and management model. Its decentralised structure creates a framework for networking and empowerment of local managers and supports its focus on people and responsive organisations.

93

94

Business activity Contracting VINCI Construction

VINCI 2012 Annual Report

95

Business activity Contracting VINCI Construction

Competitive position

Revenue

Net income attributable to owners of the parent

(in €m)

of VINCI Construction in its main markets

France VINCI Construction is the leader in a market estimated at more than €200 billion, ahead of Bouygues Construction, Eiffage Construction, Fayat and Spie Batignolles. The remaining market is divided among medium-sized regional companies and a large number of small contractors. United Kingdom VINCI Construction UK is a company of significant size in the United Kingdom, especially in the building and civil engineering sectors. Its main competitors are the Balfour Beatty, Royal BAM (BAM Nuttall), Skanska UK, Carillion and Laing O’Rourke groups. The British market is estimated at nearly €160 billion. Belgium CFE is one of the leaders in a Belgian market estimated at over €37 billion. Its main competitors are the Royal BAM, Besix and Eiffage groups. Central Europe VINCI Construction operates in this region through its mid-sized local subsidiaries, notably in Poland and the Czech Republic. Its main competitors are Strabag, Skanska and, in Poland, Polimex-Mostostal.

14,107

2011

(in €m and as a % of revenue)

15,327

2012

Operating income from ordinary activities

421

3.1%

2.7%

2011

2012

Cash flow from operations (*)

(in €m and as a % of revenue)

(in €m and as a % of revenue)

630

625

848

876

4.5%

4.1%

6.0%

5.7%

2011

2012

2011

2012

Specialised markets VINCI Construction subsidiaries Soletanche Freyssinet and DEME operate in specialised civil engineering markets around the world. Their competitors include Trevi and Bauer in special foundations, Bouygues subsidiary VSL in prestressing and stay cable systems, and Boskalis, Jan de Nul and Van Oord in marine works and dredging. Entrepose Contracting is a global operator in design and construction of complex industrial projects in the oil and gas sector. Its main competitors include Saipem (ENI Group) and CB&I. Sources: Euroconstruct, December 2012 (market size), company literature.

433

Net financial surplus (**) (in €m)

(*) Before tax and financing costs. (**) At 31 December.

2,293

2,278

2011

2012

Revenue by business sector (as a percentage)

Building Civil engineering Specialised civil engineering and complex projects Hydraulic engineering

43% 25% 26% 6%

Revenue by geographical area (as a percentage)

France United Kingdom Belgium Rest of Europe Americas Africa Rest of the world

55% 12% 5% 8% 5% 9% 6%

96

Business activity Contracting VINCI Construction

The Millennium Challenge Corporation, a US government agency, funds poverty reduction programmes in low- and middle-income countries engaged in a process of sustainable economic development. In 2006, MCC signed a $307 million compact with Benin. Some of the funds went towards financing the rehabilitation of the Port of Cotonou, a project in which a consortium of VINCI companies took part. What sets the MCC model apart? What, for example, are the main criteria used in the selection process?

MCC encourages candidate countries to carry out reforms to strengthen governance, economic freedom and investment in human capital. It uses a selection process based on performance, as measured by some 20 indicators, and identifies priorities and projects to be carried out by the recipient countries themselves, which are responsible for implementation. Eligible countries must continue the reform process, which is assessed annually, and maintain or improve their overall performance as measured by the MCC-defined indicators.

What criteria did the Benin Millennium Challenge Account apply in the selection of the VINCI consortium to carry out the Port of Cotonou extension project?

The tender documents included environmental, employment, and occupational health and safety clauses. The bid submitted by Sogea-Satom and its partners, judged technically sound with the best financial conditions, met these requirements. The work was carried out without a single serious accident. The environmental clauses were also complied with. For example, for the extension of the sand trap, about 375,000 tonnes of rock were safely transported in compliance with local regulations over a distance of 150 km. This involved about 12,000 truck round trips and 20 trainloads. Since the structure was handed over six and a half months ahead of schedule, MCA-Benin asked the VINCI consortium to carry out other works in the Port of Cotonou (zoning, rail line, car park, lighting, etc.).

Benin is eligible for a second MCC programme, for which you are currently developing the content. Under what conditions will this new compact be signed? What kinds of companies do you think best suited to support you in implementing this second contract? The award will depend on the close-out of the first programme, the continued success of the projects already completed and the way in which the eligibility criteria are met. To implement the second programme, companies should have a profile corresponding to the projects selected between now and the end of 2013. Obviously their expertise, reliability, professionalism and experience will be major factors in the selection process.

VINCI 2012 Annual Report

97

Business activity Contracting VINCI Construction

Samuel Olukayodé Batcho

National coordinator in charge of the unit developing the second MCA Benin programme

“The bid submitted by Sogea-Satom and its partners, judged technically sound with the best financial conditions, satisfied our requirements.“

98

Business activity Contracting VINCI Construction

Resilience in Europe and international expansion VINCI Construction turned in another solid performance in 2012. Owing to its business model, which brings together networks of local subsidiaries, worldwide speciality business activities and entities dedicated to major projects, the business line proved resilient in Europe despite the tough economic climate and was able to continue expanding its activities internationally.

Growth – almost all organic – continued at VINCI Construction in 2012, with revenue increasing 8.6% to €15.3 billion. This achievement reflects the resilience of the business line’s networks of local subsidiaries (especially in France, the United Kingdom and Africa); the ramp-up of the SEA Tours–Bordeaux HSL project in France; and the international performance of VINCI Construction’s specialised engineering and major projects activities. Building on the growing collaboration between its divisions, VINCI Construction extended its international market coverage, especially in underground works and the port and energy infrastructure sector. By designing joint proposals to meet demand for comprehensive solutions from major contracting authorities and by networking its engineering, management and production capabilities, the business line was able to marshal the very substantial resources required to cope with the increasing size of projects. Meanwhile, as price pressure continued to mount, VINCI Construction’s constant focus on selective order taking, productivity and cost control kept its operating margin above 4% despite setbacks encountered on a number of projects.

Network of local subsidiaries Mainland France

Following a substantial upturn in 2011, VINCI Construction France recorded a 7.4% increase in revenue to €6.5 billion.

01

Building. After strong growth the previous year (16%), this business activity, which accounts for two-thirds of VINCI Construction France’s revenue, increased a further 6.5%. Growth was especially strong in the Greater Paris area and in the southeast. Overall, VINCI Construction France companies made the most of their comprehensive market coverage – service sector, functional and residential buildings – to pursue a strategy of offering public and private sector contracting authorities the broadest possible range of new construction and renovation services, from major design-build to local repair projects. The main projects under way or handed over during the year included, in the Greater Paris area: the Cité du Cinéma (developed by VINCI Immobilier), the Department of Islamic Art at the Louvre Museum, the Louis Vuitton Foundation for Creation, the D2 tower at La Défense, the Peninsula Paris hotel, the University of Paris-Diderot and the Ensta engineering school campus under publicprivate partnerships, and the Necker and Lagny hospitals; in the rest of France, the Hérault departmental archives in Montpellier (Pierresvives), the Confluences museum and the Confluence leisure and shopping centre in Lyon, the Museum of European and Mediterranean Civilisations (Mucem), the Terrasses du Port shopping centre and the Ambroise Paré hospital in Marseille, the Allianz Riviera stadium in Nice (under a partnership contract awarded to VINCI Concessions), the Odéon tower in Monaco, the Fernand Léger art and culture centre in Douchy les Mines in the Nord region and the hospital in Troyes. Alongside these major operations, a large number of smaller projects of all types made up the core business of VINCI Construction France.

02

01 In Marseille, a consortium made up of Dumez Méditerranée (VINCI Construction France) and Freyssinet France (Soletanche Freyssinet) carried out the foundation, structural works, metal frame and waterproofing works package on the Museum of European and Mediterranean Civilisations (Mucem) project, an avant-garde building designed by architect Rudy Ricciotti. 02 The future Allianz Riviera stadium in Nice, which will serve as a venue for the Euro 2016 football tournament, is being designed and built by local VINCI Construction France and VINCI Energies entities under a partnership contract awarded to VINCI Concessions. 03 In Bordeaux, the Jacques ChabanDelmas vertical lift bridge is being designed and built by a consortium of VINCI Construction France and Dodin Campenon Bernard companies. A major milestone was achieved in 2012 with the placement of the 117 metre long, 3,500 tonne central lift span.

VINCI 2012 Annual Report

Business activity Contracting VINCI Construction

99

03

Civil engineering. In a shrinking market, business activity increased almost 8%, primarily driven by the SEA Tours–Bordeaux HSL project. Alongside the other VINCI Construction divisions and VINCI business lines, a large number of regional and local VINCI Construction France entities are involved in the project, helping to build the line’s 415 bridges and tunnels and 240 hydraulic structures. The project entered the operational phase in 2012 and by the end of the year VINCI Construction France already had 410 people working on it. Meanwhile, a large number of projects were continued or completed during the year. These included the extension of Line B of the Lyon metro; boring of the second Croix-Rousse tunnel and start of the renovation of the existing tunnel; bridges and tunnels along the A89 motorway in the Greater Lyon area; structural work on the Prado Sud tunnel in Marseille and seismic isolation pit at the tokamak (ITER project reactor) in Cadarache in the Bouches du Rhône department; spillway of the Malarce dam in the Ardèche region; Romanche

Gavet intake dam near Grenoble and refurbishment of the Leysse cover at Chambéry; installation of the central span of the Jacques Chaban-Delmas bridge in Bordeaux; and in the Paris region, the Coudray dam, the La Morée wastewater treatment plant, civil engineering works on the Les Halles Canopy and modernisation of the Gare de Lyon train station in Paris. The main contracts won during the year were the CEVA contract (regional express line between Geneva and Annemasse), the Schuman bridge in Lyon, the Izeron bridge in the Isère region and the Cavaillon viaduct in the Vaucluse region, as well as the replica of the Chauvet cave in the Ardèche – a technically complex project carried out on a general contracting basis, including the reproduction of the cave paintings, by a VINCI Construction France-led consortium.

Hydraulic engineering. Volume held up well in markets that were contracting due to the difficulty experienced by local authorities in financing projects. The decline in standard pipeline works, especially in rural areas, was partly offset by work to divert and reconnect utility networks in conjunction with urban development (light rail) and high-speed rail line works. In water treatment, VINCI Construction France won new contracts for the Finfarine water production plant in Sables d’Olonne, the Erstein wastewater treatment plant in the Bas-Rhin region and a water production plant in Reims under a public-private partnership. In the Greater Paris area, work got under way on the new Seine Aval pre-treatment unit in Achères, Europe’s largest wastewater treatment facility.

100

Business activity Contracting VINCI Construction

Overseas France Revenue increased 7.3% to nearly €0.6 billion in markets buoyed by uninterrupted public investment in healthcare, education, public housing and water treatment and by a variety of projects in the traditional markets that make up the core business of VINCI Construction Dom-Tom companies. In building, which accounts for half of all business, the main projects under way were the Capesterre middle school (900 students) and the René Lacrosse medical centre in Guadeloupe. Operations started or won during the year included the Stella Matutina museum on Reunion Island, an administrative detention centre in Mayotte, a 130-room hotel in Cayenne, French Guiana, and the major Médipôle hospital complex (80,000 sq. metres of buildings, 450 rooms, 12 operating theatres) in Koutio, New Caledonia. Other projects included, in the civil engineering sector, the Saint Etienne River bridge on Reunion Island and the new European Vega launch facility in French Guiana; and in the hydraulic engineering sector, new wastewater treatment facilities on Reunion Island (Grand Prado) and in Cayenne, French Guiana, and the Matiti water production plant in French Guiana; and in the earthworks sector, the Paddon residential estate in Paita, New Caledonia.

01

Western Europe Benelux. CFE (excl. its 50% owned subsidiary DEME), which is held 46.8% by VINCI Construction, recorded a 3.4% increase in revenue to €0.9 billion. Building activity grew in Belgium but declined in Central Europe and the export markets due to a number of delayed project starts. In this sector, the main projects included the start of construction by CFE, under a DBFM (design, build, finance, maintain) contract, of a building complex in Charleroi that will accommodate, inter alia, the new police department. Designed by architectural firms Jean Nouvel and MDW Architecture, the project won a prize at the Cannes world property trade fair (Mipim). In civil engineering, CFE completed construction of the Diabolo rail link in Brussels and continued two large projects being carried out by the Group under concession contracts: construction of the second Coentunnel in Amsterdam (a 750 metre, five-lane submerged road tunnel) and the Liefkenshoek rail link

(16 km, of which nearly half runs underground) in the Port of Antwerp. In 2012, work proceeded at a fast pace on these two projects, which are scheduled to open to traffic in 2013. The property development activity in Belgium and Luxembourg held steady at a satisfactory level. Business was stable for the multi-technical engineering and maintenance division and increased in the rail and road division due to the acquisition of Remacom, a company specialising in track laying. United Kingdom. Despite an economic environment that remained extremely tough, VINCI Construction UK continued to increase its revenue (up 6.5% to €1.4 billion) and position itself in its most buoyant market segments. In building, business remained brisk in the hospital sector, notably driven by the ProCure21+ programme, for which VINCI Construction UK is already qualified; in the retail building sector, driven by various

01 The Médipôle hospital complex in Koutio, New Caledonia, with 450 rooms and 12 operating theatres, is being built by a consortium led by VINCI Construction in association with VINCI Energies. It is New Caledonia’s largest public building. 02 The Diabolo rail link between Brussels National Airport, the main Belgian rail lines and Antwerp was inaugurated in June 2012. It was built by the Dialink consortium, which includes CFE subsidiary MBG, with the participation of some Soletanche Freyssinet companies.

VINCI 2012 Annual Report

projects for long-standing customer Tesco; and in the education sector, driven by university development works under way or in the start-up phase in the south-west and in Wales. During the year, the very large New Covent Garden Market redevelopment project, which will take five years to complete, got under way in London’s Vauxhall district. During the first phase, VINCI Construction UK will build, as part of a consortium, a 150,000 sq. metre complex with a value of £130 million (€159 million). In civil engineering, volume was high in 2012 due to modernisation work on the London underground. In addition to continuing or initiating projects at the Tottenham Court Road and Victoria stations, VINCI Construction UK completed work on King’s Cross station. It also began construction of the new Whitechapel station as part of the Crossrail project under a €135 million contract that will be implemented over a period of six years. During the year, the second phase of work on the Nottingham light rail system, a project carried out under a PPP, was also launched. Lastly, in the airport sector, VINCI Construction UK won the contract to transform Pier 1 at London Gatwick South Terminal (a €105 million contract), a follow-on to the many projects previously carried out by the company at that airport.

02

Business activity Contracting VINCI Construction

Central Europe Operating in three Central European countries – Poland, the Czech Republic and Slovakia – VINCI Construction recorded a 7.7% decline in revenue to €0.5 billion due to a general economic downturn. In Poland, Warbud worked with Eurovia on A2 motorway and S5 expressway projects, which were completed in record time in the run-up to the Uefa Euro 2012 football tournament. In building, significant construction contracts were won, including a 527-bed paediatric teaching hospital and the 105,000 sq. metre Plac Unii office and shopping complex in Warsaw, and the extension of the Gillette plant in Lodz. In a consortium with VINCI Environnement, Warbud also won the contract to upgrade the Olawa waste treatment plant, which produces biogas used to generate electricity, heat and refrigeration. In the Czech Republic, where the economy was in recession and major road infrastructure programmes were completed, SMP branched out into water treatment by acquiring a specialised company and winning the contract to build a wastewater treatment plant in Bohemia. Prumstav, the building subsidiary, also won the contract to build the new Karlin Hall II office building in Prague. In Slovakia, following completion of the PR1BINA expressway, SMS was selected, as part of a Eurovia-led consortium, to build a 9.5 km section of the D1 motorway near Levoča, including a twin-bore tunnel and 12 bridges.

Africa Sogea-Satom’s revenue continued to grow, with a 10.4% increase to €0.9 billion in markets where private-sector investments are taking the place of funding by major

101

international donors. Making the most of the long-standing roots and high quality expertise that have enabled it to hold its own in a highly competitive environment, Sogea-Satom maintained a high level of activity in all its business sectors. The company’s strength in roadworks and earthworks, which account for more than half of its revenue, continued with a large number of construction and refurbishment projects, notably in Tanzania, Burundi, Chad and Burkina Faso (where agricultural water projects in the Dî area will provide irrigation for more than 2,000 hectares of land) and in the Congo. In civil engineering, synergies developed with other VINCI Construction divisions were put to use in the new contract to extend the port of Lomé, Togo, following on from a similar project completed in 2012 in Cotonou, Benin, and in the contract covering the chemicals site at the port of Jorf Lasfar, Morocco (construction of two storage facilities for phosphate fertilisers with unit capacities of 100,000 tonnes). The hydraulic engineering activity also expanded, with major projects under way including reinforcement of the drinking water system in Libreville, Gabon, and the raw water treatment plant in Yaoundé, Cameroon. Lastly, Group synergies generated sustained business in the building sector, with the completion of the RenaultNissan plant in Tangier, Morocco, as well as ongoing construction of Toukra University and the start of the Finance Ministry project in N’Djamena, Chad. Other VINCI Construction divisions operate in Africa in specialised civil engineering, building, oil and gas infrastructure and major projects. Across all subsidiaries, VINCI Construction generated revenue of €1.4 billion, unchanged from 2011.

Specialised civil engineering

Soletanche Freyssinet At Soletanche Freyssinet, revenue rose 12.9% to €2.5 billion as a result of both organic growth and acquisitions. In each of its business activities (soils, structures, nuclear), Soletanche Freyssinet’s specialised expertise is an international benchmark, positioning the company in major infrastructure projects around the world. Business was particularly brisk in the United States, Canada, Australia, Mexico and France. Volumes declined substantially in

102

the Middle East, Iberian Peninsula and Central Europe, where markets were contracting, but held steady overall in Asia, Latin America and Africa. Soletanche Freyssinet’s targeted acquisitions strategy enabled it to consolidate and expand its international networks in the Americas (United States, Canada, Colombia), New Zealand, South Africa and Central Europe (Czech Republic and Slovakia). The company set up new subsidiaries in Peru, Kuwait and the Philippines. Deep foundations and ground technologies Soletanche Bachy recorded 15% growth, driven by the performance of its subsidiaries in France and North America. The company also integrated the entities acquired in 2011 in Canada, the United Kingdom or Turkey. The main projects completed or under way during 2012 included Crossrail and Lee Tunnel in the United Kingdom; Wolf Creek dam, Port of Miami tunnel and San Francisco and New York Second Avenue metros in the United States; El Teniente mine in Chile; Hong Kong airport; the National Art Gallery in Singapore; the Reforma and Bancomer high-rise buildings in Mexico; the T6 light rail in Viroflay, France; CEVA in Switzerland; the Odéon tower in Monaco; the ports of Puerto Brisa, Argentina and Montevideo, Uruguay; and the Singapore, Hong Kong and Kuala Lumpur metros in Asia. New orders included work on the ports of Lomé in Togo, Jebel Ali in Dubai and Puerto Bahia in Colombia; the Lake Nyos dam in Cameroon, the Goldin Financial Center in Hong Kong and the Second World War Museum in Gdansk, Poland. At Menard (ground consolidation), volumes held steady. The year’s main projects included: port works at the future tanker terminal in Dunkerque, France; the S8 expressway in Poland; the General Electric

Business activity Contracting VINCI Construction

(Gemtec) technology centre in Dammam, Saudi Arabia; the port extension in Gulfport, Mississippi, United States; the Barangaroo seafront in Sydney, Australia; the Gemalink container terminal in Vietnam; and the Kutubu Central Processing Facility, as part of the PNG-LNG project in Papua New Guinea. New contracts included Terminal 3 at Jakarta airport, the Wynn Cotai casino in Macao and the Ichthys LNG project in Australia. Structures Freyssinet’s business activity increased despite the market downturn in Central Europe and Spain, which was notably offset by good performance in the United Kingdom, North America, Mexico and Australia. The main projects completed and under way during the year included the Russky Island and Golden Horn bridges in Vladivostok, Russia; the Verdun sur Garonne suspension bridge, the Pannecière dam and Marseille’s Mucem museum in France; the Hammersmith bridge in London, United Kingdom; the city hall in Bucharest, Romania; the Dong Siri project in Denmark; Liakhvi viaduct in Turkey; Port Mann bridge in Canada; San Marco and Frontera bridges in Mexico; Iligan cement works in the Philippines; Kumho-kang bridge in South Korea; and the Anzac and Alelaide Superway bridges in Australia. The main orders booked were for the MLC Tower in Australia and an oil platform in Canada as part of the Hebron project. Terre Armée (retaining structures and prefabricated arch tunnels) recorded a substantial increase in revenue, with activity growth especially high in North America (Fort Lauderdale airport, I-595 motorway and Los Vaqueros dam in the United States; Windsor Essex Parkway in Canada), France and Morocco, and in the mining sector in southern Africa, Canada, Australia and Asia. In South Korea, Terre Armée built its largest prefabricated arch (TechSpan®) structure to date on a 2.3 km covered motorway. Nuclear Nuvia again recorded strong growth, up 17%. In addition to brisk business in its two main markets, France and the United Kingdom (where its order book reached a record high, largely as a result of diversification into military works), the company was bolstered by new business in China and the subsidiaries recently set up in Canada and Sweden. In France, Nuvia’s nuclear logistics, decommissioning and risk control expertise was deployed at EDF, Areva and CEA sites, with two major projects, namely the safety upgrade at the Fessenheim plant and the dismantling of the reactor building at Creys-Malville in south-eastern France. In the United Kingdom, Nuvia continued to take part in the Silos Direct Encapsulation

01

02

VINCI 2012 Annual Report

Business activity Contracting VINCI Construction

103

01 The Verdun sur Garonne suspension bridge, with a span of 154 metres, was built under a public-private partnership by VINCI Construction France, Dodin Campenon Bernard and Freyssinet, with the participation of Eurovia. 02 At the El Teniente site in Chile, the world’s largest underground copper mine, VINCI Construction Grands Projets and Soletanche Bachy are blasting two 9 km long tunnels, one to transport personnel and the other to transport ore, as well as two intermediate access tunnels with a total length of 6 km.

104

Business activity Contracting VINCI Construction 01 In Qatar, VINCI Construction Grands Projets, Entrepose Contracting and QDVC handed over the 900,000 m3/day PS 70 pumping station and 45 km of pipelines that will carry wastewater from Doha to a treatment plant located 25 km north of the capital city.

(SDP) project at Sellafield and widened the range of its activities by demolishing a radiological research laboratory and taking part in the British nuclear submarine dismantling programme.

Oil and gas infrastructure Entrepose Contracting recorded a 12.4% increase in revenue to €0.8 billion, partly as a result of external growth, despite postponement of a number of investments by contracting authorities. Work on the 450 km Papua New Guinea pipeline project proved difficult due to particularly inclement weather. Strong oil and gas field commissioning activity continued apace at the Skikda site in Algeria, where Entrepose Contracting has been working for several years, and the El Merk site in south-eastern Algeria, where North Africa’s largest crude oil refinery is being built. In liquefied natural gas (LNG) storage tanks, Entrepose Contracting continued construction of three 190,000 cu. metre tanks in Dunkerque, France. In Australia, Entrepose Contracting and VINCI Construction Grands Projets formed a consortium that won a contract with a value of some €400 million to build four tanks as part of the Wheatstone project; construction is scheduled to start in 2013. In addition, to consolidate its position in the buoyant underground liquid and gaseous hydrocarbon storage market, Entrepose Contracting raised its stake in subsidiary Geostock, a world leader, from 25% to 90%.

Dredging DEME(*) maintained a high level of revenue, at €1.7 billion, and raised its order book to a historic high – up 59% in one year – primarily as a result of three major contracts that will get under way and take several years to complete: the Wheatstone LNG project on the west coast of Australia (dredging of the approach channel, manoeuvring area and berths); a €941 million contract for dredging and breakwater construction at a new port in Qatar, which will serve as a base for the Qatar Navy; and construction of the seventh and last offshore wind farm in the North Sea off Belgium (Northwind project), for which DEME’s specialised GeoSea subsidiary will be installing the 73 steel mono piles that will serve as foundations for the wind turbines, laying the cables and installing the turbines. This last order follows on from the C-Power project, a 54-turbine offshore wind (*) The DEME group is 50% owned by CFE, which is 46.8% held by VINCI Construction. DEME is accounted for under the equity method in accordance with IAS 31 “Interests in Joint Ventures”.

farm for which the successive phases began in 2008 and will be completed in 2013. Meanwhile, DEME continued to upgrade its fleet. The fleet includes nearly 80 large dredgers and 200 auxiliary vessels. Ships launched during the year included the Neptune and the Innovation, two large offshore construction vessels, and the Ambiorix and Amazon ocean-going rock cutter dredgers.

Complex project management and construction The companies making up this division offer an excellent fit in complex project design, engineering, management and construction. In 2012, they were involved primarily in the SEA Tours–Bordeaux HSL project. At the end of December, 1,640 division employees were working on the project within the construction joint venture, COSEA, in which VINCI Construction is the main company. VINCI Construction Grands Projets put in a good performance in 2012, marked by a return to growth with revenue up 10.8% to €0.6 billion and a continuing high level of order intake. At the end of the year, the order book stood at almost €2 billion, i.e. more than two years of business activity. The map of projects under way and won in 2012 reflects uninterrupted business in the countries where VINCI Construction Grands Projets has a long-standing presence (France, United Kingdom, Egypt, Qatar, Malaysia, Jamaica, Trinidad and Tobago) as well as business in countries where it has more recently begun operations, such as Australia, Hong Kong, Chile and Panama. The types of project carried out illustrate both the sound positions held by the company in the major bridges and tunnels, underground works and hydraulic works

markets, as well as its more recent expansion into the international market for major building projects. The main handovers were the new pumping station in Doha (carried out with Entrepose Contracting) and the Lusail car parks in Qatar; a motorway interchange in Trinidad and Tobago; the Athens metro extension in Greece; cryogenic storage tanks at Skikda, Algeria; and drinking water system upgrades in Kingston, Jamaica. Projects under way during the year included the Chernobyl confinement structure in Ukraine (carried out in a special assembly area 300 metres from the damaged reactor), phase 2 of Cairo’s metro line 3 in Egypt, the Lusail light rail and Sheraton Park projects in Doha, Qatar, the Hallandsås rail tunnels in Sweden, the Coentunnel road tunnel in the Netherlands, the Liefkenshoek rail link in Belgium, Lee Tunnel in London, the El Teniente mining tunnels in Chile and the extension of the Kantale wastewater treatment plant in Sri Lanka. VINCI Construction Grands Projets also began work on new projects: the Assiut dam in Egypt, the Wheatstone LNG tanks in Australia, the Government building in Ashgabat, Turkmenistan, Liverpool Street and Whitechapel stations on the London underground and the Berjaya Central Park property complex in Kuala Lumpur, Malaysia. Lastly, new orders included three major contracts booked at the end of the year. The first is the construction of a 4 km tunnel in Hong Kong for the new SLC metro (a contract with a value of €280 million). The second is the construction of the 1,050 metre long Atlantic Bridge in Panama, which will rise 75 metres above water level; with a 530 metre central span, it will be the world’s longest cable-stayed concrete bridge. The third contract covers the construction of a 762 metre cable-stayed bridge over the Ohio River and a 512 metre twin-bore tunnel in Indiana, the United States, under a PPP for which VINCI Concessions was declared preferred bidder at the end of 2012.

VINCI 2012 Annual Report

Business activity Contracting VINCI Construction

105

Outlook

01

VINCI Construction Terrassement generated revenue of €0.5 billion, up 31%, driven primarily by a large number of projects carried out simultaneously along the SEA Tours–Bordeaux high-speed rail line, which accounted for revenue of €279 million in 2012. Work on the highspeed line more than offset completion of work on the A89 motorway on the outskirts of Lyon and on the A63 motorway for VINCI Autoroutes. The other main projects in France included the Rizzanese dam in Corsica and the Romanche Gavet dam in the Isère region, the East European HSL (Phase 2), the Canari asbestos mine containment in Corsica and the Mont Saint Michel project, on which VINCI Construction Terrassement is cleaning and expanding the basins designed to restore the hydraulic balance of the site. In the international market, the company continued work on the Bata-Ayak N’tang motorway in Equatorial Guinea in conjunction with Sogea-Satom. Dodin Campenon Bernard increased its revenue 16% to €0.2 billion. In synergy with the other VINCI Construction entities, the company completed several projects in 2012.

These included, in underground works, the tunnels for metro Line 12 and the VL9 collector main in the Greater Paris area; the Oullins tunnel at Lyon and the Violay tunnel on the A89 motorway. It continued work on the Saverne tunnel on the East European HSL line and the Croix-Rousse tunnel in Lyon. Bridge construction also proceeded apace in France, with major projects under construction including the Jacques Chaban-Delmas lift bridge in Bordeaux and the bridge over the Saint Etienne River on Reunion Island, as well as handover of viaducts on the A89 and A63 motorways and the Verdun sur Garonne suspension bridge. Business was also brisk in industrial civil engineering in the nuclear sector, with completion of work on a building at La Hague and continuation of the Iter project at Cadarache. In hydraulic structures, the company began work on the Romanche Gavet underground hydroelectric facility. New orders included a very large volume of work on the SEA Tours–Bordeaux HSL project, as well as the new A304 motorway project between Charleville Mézières and Rocroi – 193 metre La Sormonne viaduct; 23.5 km of earthworks, engineering structures and communication restoration (TOARC).

VINCI Construction’s year-end order book stood at €18.1 billion, suggesting that overall business volumes can be expected to hold steady in 2013. The ramp-up of the SEA Tours–Bordeaux high-speed rail project will bolster business activity in France. It is expected that the other networks of local subsidiaries will also achieve volume similar to that of 2012 and hold up well in the European markets; that brisk business activity will continue unabated in Africa; and that the specialised civil engineering and major projects businesses, which have recently stepped up their pace of internationalisation, will continue to expand, especially outside the European Union. In all the regions where VINCI Construction operates, better collaboration between its divisions will help to extend its market coverage, as significant contracts recently won worldwide have demonstrated. Joint bids will be drawn up to meet demand for comprehensive solutions on the part of large contracting authorities, and engineering, management and production resources will be networked. As the size of projects increases in most markets, VINCI Construction’s ability to marshal the full range of technical capabilities and execution resources required will be an increasingly decisive strength. Looking beyond the short term and the effects of budgetary policies in Europe, VINCI Construction will benefit, over the long haul, from strong demand in the sectors in which it operates: transport and energy infrastructure, urban development, water supply and treatment systems, public buildings (healthcare, education, recreation), and newgeneration residential and service sector buildings.

106

Business activity VINCI Immobilier

Prudent strategy against a backdrop of market uncertainty

In an unsettled business environment, VINCI Immobilier stepped up its strategy of selectively focusing on the most thriving market segments and on high value added operations.

A climate of economic and tax uncertainty put a damper on property acquisitions by individual, business and institutional investors in 2012, resulting in a sharp decline in volume. Nevertheless, as a result of the large number of reservations recorded in 2011, VINCI Immobilier’s revenue increased more than 16% to €811 million (Group share).

Residential property The market took a sharp downturn in 2012. Despite historically low interest rates, higher taxes on capital gains and rental income deterred property purchases by individual investors. VINCI Immobilier recorded a sharp decline (36%) in reservations. As a result of this change, together with the company’s higher pre-sale requirement for initiating construction, the number of housing starts declined from 3,878 in 2011 to 2,792 in 2012. The contraction in the number of notarised deeds was less pronounced, thanks to the high level of reservations in the previous year. These transactions amounted to €707 million in 2012, compared with €767 million in 2011. Significant handovers included the Amplia residential operation in the Confluence district in Lyon, an energy-positive building that meets the highest standards for environmental quality and thermal performance.

Business and commercial property Despite the economic downturn and the wait-and-see approach taken by investors, 2012 was a highly satisfactory year due to the sale of a number of significant operations. In Paris, these included two hotels – one at La Défense, the other at the Porte des Lilas – with a total of 634 beds, and the 12,100 sq. metre Paris Rivoli retail, apartment and office complex; and a 138-room hotel in Grenoble. These projects exemplify VINCI Immobilier’s strategy of targeting large operations in good locations, combined with a systematic user search and the financial capacity to acquire the land required to build them. Sales in this market, across all operations, amounted to €339 million for the year (at 100%). In the office segment, the preparation of the second phase of the SFR head office project in Saint Denis, on which construction started in early 2013, was also of note. The highlight of the year was VINCI Immobilier’s handover of the Cité du Cinéma in Saint Denis. The Group supported cinema producer and director Luc Besson at all stages of the major project, first as the developer and investor via VINCI Immobilier and then as the builder. With nine sound stages, a 500-seat screening room and a wide variety of facilities, the complex, which meets the highest international standards and where films can be produced from start to finish, is now available to the French film industry. The service activity (property management for individual investors; services for businesses and large user and investor accounts) held steady at a level comparable to 2011.

Outlook VINCI Immobilier will continue its targeted strategy focused on large metropolitan areas and operations of sufficient technical and financial scope to make the most of its expertise. The residential property portfolio covers land under provisional sale contract on which well-situated residential complexes meeting user expectations can be built as soon as the market picks up. In business and commercial property, VINCI Immobilier will continue its targeted strategy focused on major accounts and select high-quality products that combine adaptability, accessibility and attractiveness for users.

VINCI 2012 Annual Report

Business activity VINCI Immobilier

107

01

02

01 First energy-positive residence to be built in the Confluence district in Lyon. Amplia offers 66 apartments with a common garden. It has 115 sq. metres of solar panels to produce hot water, more than 800 sq. metres of photovoltaic panels and a rainwater harvesting system used to water the garden. Amplia has obtained BBC Effinergie certification. 02 VINCI Immobilier is carrying out a project that involves both structural renovation and new construction in the Rue de Rivoli in Paris to create a multi-purpose complex comprising apartments, shops and offices.

108

109

VINCI 2012 Annual Report

General & financial elements

110 Report of the Board of Directors 177 — Report of the Statutory Auditors expressing limited assurance on selected social, environmental and societal information 179 Report of the Chairman of the Board on corporate governance and internal control procedures 193 — Report of the Statutory Auditors in application of Article L.225-235 of the French Commercial Code on the Report of the Chairman of the Board of Directors 194 Report of the Vice-Chairman and Senior Director of the Board of Directors

195 Consolidated financial statements 197 — Consolidated financial statements 202 — Notes to the consolidated financial statements 275 — Report of the Statutory Auditors on the consolidated financial statements 276 Parent company financial statements 277 — Parent company financial statements 280 — Notes to the financial statements 292 — Report of the Statutory Auditors on the parent company financial statements 293 — Special report of the Statutory Auditors on regulated agreements and commitments 298 Persons responsible for the registration document 299 Registration document table of correspondence

110

Report of the Board of Directors

Report of the Board of Directors Contents A.

B.

C.

Report on the financial statements for the year

111

Post balance sheet events, trends and outlook

118

Risk factors

120

1. Consolidated financial statements 2. Parent company financial statements 3. Dividends

1. Material post balance sheet events 2. Information on trends 3. The Group’s markets: seasonality of business

1. Operational risks 2. Financial risks 3. Legal risks 4. Environmental and technological risks 5. Insurance cover against risks

111 118 118

118 119 119

120 123 124 124 125

D. Company officers and executives

127

E.

Social and environmental information

138

General Information about the Company and its share capital

169

1. Company officers’ appointments and other positions held 2. VINCI shares held by the company officers 3. Company officers’ remuneration and interests 4. Options and performance shares

F.

1. Workforce-related responsibility 2. Environment 3. Social responsibility 4. Note on the methods used in social and environmental reporting

1. Corporate name and Articles of Association 2. Relations between the parent company and subsidiaries 3. General information about VINCI’s share capital 4. Matters that could be material in the event of a public offer 5. Other information on the Company forming an integral part of the Report of the Board of Directors Report of the Statutory Auditors expressing limited assurance on selected social, environmental and societal information

127 131 132 134

139 150 159 166

169 170 171 174 175

VINCI 2012 Annual Report

Report of the Board of Directors

111

A. Report on the financial statements for the year 1.

Consolidated financial statements VINCI turned in a robust performance in 2012, with further growth in revenue and net income despite a difficult economic climate, particularly in Europe. This achievement reflects the soundness of the Group’s fundamentals: the complementary nature and resilience of its two core businesses (Concessions and Contracting), growth focusing on high value-added activities outside France and prudent financial management. VINCI’s consolidated revenue rose 4.5% to €38.6 billion. This represents 1.5% organic growth, a 0.8% positive currency effect and 2.3% growth from acquisitions. The main acquisitions, made by Contracting entities, were outside France. In 2012, 37% of total revenue was generated outside France (42% in Contracting). Cash flow from operations before tax and financing costs (Ebitda) amounted to €5.4 billion (+1%) and equal to 14.0% of revenue. VINCI Autoroutes’ Ebitda margin improved slightly, from 69.5% in 2012 (69.4% in 2011). Operating income from ordinary activities (Ebit) was €3.7 billion, up 0.3% and representing 9.5% of revenue, compared with 9.9% in 2011. In Contracting, the Ebit margin was 4.2%, against 4.6% in 2011. The decline is attributable mainly to non-recurring items at Eurovia and VINCI Construction. Operating income, which reflects the impact of IFRS 2 share-based payment expense, impairment charges and the Group’s share of income or loss from companies accounted for under the equity method, was €3.7 billion (+1.4% compared with 2011). Net income attributable to owners of the parent was €1,197 million, representing 0.7% growth compared with 2011. Earnings per share increased 1.6% to €3.54, partly due to the Group’s purchases of its own shares during 2012. Net financial debt was €12.5 billion at 31 December 2012, slightly down relative to end-December 2011. Operating cash flow amounted to €3.1 billion in 2012 and covered all investments by VINCI Autoroutes (€1.1 billion), 2012 acquisitions(€0.7 billion) and dividends paid (€1.1 billion). VINCI’s credit ratings were confirmed by Standard & Poor’s (BBB+) and Moody’s (Baa1), both with stable outlook. The Group obtained excellent terms for several bond issues and placements totalling more than €1.5 billion, at an average interest rate of 3.66%, to refinance its debt in advance. VINCI continued to benefit from good access to credit and was able to renew for five years a bank credit facility granted to ASF for €1.8 billion. At 31 December 2012, the Group’s liquidity was very high at €11.5 billion. It comprises €5.0 billion net cash managed and €6.5 billion mediumterm bank credit facilities maturing in 2016 and 2017. Contracting maintained its good business momentum throughout 2012, especially outside France. At 31 December 2012, its order book stood at €31.3 billion (up more than 2% relative to end-2011), of which 45% is outside France. The international order book is up 12% over 12 months.

1.1

Highlights of the period

1.1.1

New contracts and main acquisitions Simplified public offer for Entrepose Contracting In April 2012, VINCI initiated a simplified public offer for the 19.83% of shares in Entrepose Contracting that it did not already own, at a price of €100 per share. After the offer ended on 14 June, VINCI owned 97.37% of Entrepose Contracting. It then bought out all remaining shareholders that did not originally tender their shares to the offer. At 31 December 2012, VINCI’s stake in Entrepose Contracting was 100%. Acquisitions by Eurovia In January 2012, Eurovia acquired NAPC, a road construction, earthworks and civil engineering company based in Chennai, India. In 2012, NAPC generated revenue of €95 million. In late March 2012, Eurovia acquired Carmacks, a group of companies based in Alberta, Canada. Carmacks, which builds road infrastructure and carries out road maintenance under long-term contracts, generated revenue of €212 million in 2012. Acquisitions by VINCI Energies In September, VINCI Energies completed the acquisition of the Energieversorgungstechnik (EVT) division of the Alpiq group. This division contained Alpiq’s engineering and construction activities relating to power and telecommunications infrastructure in Germany and Central Europe. The EVT division, renamed GA Gruppe, is a vertically integrated unit offering a comprehensive range of services in engineering, design, construction and maintenance for power transmission and distribution operators, telecommunications infrastructure operators and industry. GA Gruppe employs around 3,000 people and generated €519 million of revenue in 2012.

112

Report of the Board of Directors

Also in September, VINCI Energies completed the acquisition of Indian engineering company Vasundara. Headquartered in Bangalore, Vasundara has a presence in Chennai, Hyderabad, the United Arab Emirates and Malaysia. It operates in industrial automation, mechanical solutions and robotics. Acquisition by Entrepose Contracting Entrepose Contracting, a subsidiary of VINCI Construction, increased its stake in Geostock from 25% to 90%. Geostock operates in 26 countries and had revenue of €90 million in 2012. It has extensive customer references, in France and abroad, covering consultancy, engineering, and operation and maintenance of underground storage facilities for liquid and gaseous hydrocarbons. Other acquisitions Other transactions in which VINCI SA acquired equity interests or control are mentioned in the notes to the parent company financial statements on page 280.

1.1.2

Financing operations New corporate financing As part of its €3 billion EMTN programme, VINCI SA carried out several bond issues and placements in the first half of 2012 to refinance its debt: ˇˇ January 2012: - the Company tapped the February 2017 4.125% bond line issued in December 2011 by €250 million; - it issued SFr100 million (€82 million) of 10-year bonds; - it carried out two private placements totalling €175 million, i.e. a five-year placement for €100 million and a seven-year placement for €75 million; ˇˇ in March 2012, it issued €750 million of eight-year bonds with a coupon of 3.375%. ˇˇ In June, July and September, ASF carried out three private placements – for 11, 12 and 10 years, respectively – amounting to €170 million in total as part of its EMTN programme. ˇˇ In June 2012, CFE issued €100 million of six-year bonds with a coupon of 4.75%. Debt repayments In January 2012, VINCI made an early repayment of €750 million to reimburse the remainder of the loan taken out in 2006 to finance the acquisition of ASF. In late June 2012, ASF Holding repaid a €1,080 million syndicated loan arranged in December 2006 and due to expire in the fourth quarter of 2013. In October, ASF repaid €406 million of loans from the CNA (Caisse Nationale des Autoroutes). After these transactions, the average maturity of the Group’s financial debt was 6.1 years at 31 December 2012. Renewal of ASF’s medium-term bank credit facility In July, ASF agreed a five-year €1.8 billion syndicated credit facility with a consortium of banks, replacing the previous €2 billion facility due to expire in December 2013. Long-term financing granted for infrastructure projects under concession or public-private partnerships In 2012, VINCI signed long-term project financing agreements, without recourse to shareholders, totalling around €350 million. They concerned mainly PFI (Private Finance Initiative) contracts for road maintenance in Hounslow (£88 million, 24.5 years) and the Isle of Wight (£95 million, up to 24.5 years) in the UK, and the Dunkerque Arena (€69 million, 27 years and eight months) in France.

1.2 Revenue

VINCI’s 2012 consolidated revenue amounted to nearly €38.6 billion, up 4.5% compared with 2011. This reflects organic growth of 1.5% and a 0.8% positive exchange rate effect, along with 2.3% from the acquisitions made by Eurovia (NAPC in India and Carmacks in Canada) and VINCI Energies (GA Gruppe in Germany) in 2012, and by Soletanche Freyssinet in Turkey and the UK at the end of 2011. Concessions revenue rose 1.1% (0.9% on a comparable structure basis) to almost €5.4 billion, with a 0.7% increase at VINCI Autoroutes and strong growth at VINCI Airports. Contracting revenue (VINCI Energies, Eurovia, VINCI Construction) was €33.1 billion, up 5.1%, or 1.5% on a comparable structure basis. In France, revenue totalled €24.3 billion, an increase of 3.2% (3.0% on a constant structure basis). Concessions revenue grew 0.9%, while that of Contracting increased 3.9%. Outside France, revenue rose 6.8% to €14.3 billion, although this represents a decrease of 1.1% on a constant structure and exchange rate basis. In 2012, 37% of VINCI’s total revenue was generated outside France (42% in Contracting). CONCESSIONS VINCI Autoroutes (ASF, Escota, Cofiroute and Arcour): revenue rose 0.7% to €4,439 million. Toll revenue increased 0.6% despite a 1.7% decrease in traffic on a stable network (light vehicles down 1.4%; heavy vehicles down 3.5%), but this decline was offset by the ramp-up of the A86 Duplex (+0.2%) and higher toll prices. VINCI Concessions generated revenue of €915 million, up 3.1% (1.8% on a comparable structure basis). VINCI Airports recorded strong growth (18%) due to growing traffic levels at Nantes-Atlantique airport and those of Cambodia Airports. VINCI Park posted slight growth in revenue to €615 million (up 2.6% on an actual basis or 1.5% on a comparable structure basis, including 1.3% in France and 2.2% internationally).

VINCI 2012 Annual Report

113

Report of the Board of Directors

CONTRACTING VINCI Energies: €9,017 million (+4.0% actual; +0.9% on a comparable structure basis) In France, revenue was €5,486 million (-0.4% actual; stable on a constant structure basis). Business levels remained strong in telecommunications with the ramp-up of the GSM-R project, and in energy infrastructure, but they were adversely affected by weaker photovoltaic business. The industrial sector was resilient in an unfavourable economic environment. However, activity in the tertiary sector was less robust, despite firm growth at VINCI Facilities (+5.6%). Outside France, revenue totalled €3,531 million (+11.7% actual; +2.7% on a comparable structure basis). The situation varied geographically. In Europe, business levels fell sharply in Spain and Portugal, grew slightly in Switzerland and Germany (on a comparable structure basis), with more pronounced growth in Belgium, the Netherlands and Sweden. Strong growth was recorded in emerging-market countries such as Indonesia, Morocco and Brazil. Eurovia: €8,747 million (+0.3% actual; -4.5% on a comparable structure basis) In France, revenue was €5,159 million, up 1.2% on an actual basis (0.5% on a constant structure basis). Roadworks business taking place through regional entities was stable, with a fall in volumes of around 4% offset by higher prices for oil products. Specialist businesses like demolition, industrial activities and rail sector works posted growth of over 9% (almost 5% on a comparable structure basis). Outside France, revenue totalled €3,588 million, down 1.0% (-11.4% on a comparable structure basis). There was firm growth in the UK, Chile, the USA and Canada. However, Central European countries posted significant declines in activity due to the end of major projects (the R1 expressway in Slovakia and a fall in investment in Poland after the Euro 2012 football tournament) and a difficult economic environment in the Czech Republic. Business levels in Germany remained stable. VINCI Construction: €15,327 million (+8.6% actual; +5.5% on a comparable structure basis) In France, revenue amounted to €8,410 million, up 8.8% actual or 8.5% on a constant structure basis. This reflects the ramp-up of the Tours– Bordeaux high-speed rail line project, which accounted for revenue of more than €550 million in 2012, along with ongoing steady growth in residential and non-residential building activity. French overseas territories posted a good performance. Outside France, revenue was €6,917 million, up 8.5% (+2.1% on a comparable structure basis). The change on a comparable structure basis reflects rapid growth at Sogea-Satom in Africa, which offset the contraction seen by Central European subsidiaries. Business levels in other divisions (Benelux and the UK) were stable overall. VINCI Immobilier Revenue rose 16.2% to €811 million in 2012. This growth was driven by residential property after work began on a significant number of units in late 2011, and by several large business property projects.

Revenue by business line 2012 

2011

(in € millions) Concessions VINCI Autoroutes VINCI Concessions Contracting VINCI Energies Eurovia VINCI Construction

2012/2011 change Actual

Comparable

5,354

5,297

+1.1%

+0.9%

4,439

4,409

+0.7%

+0.7%

915

888

+3.1%

+1.8%

33,090

31,495

+5.1%

+1.5%

9,017

8,666

+4.0%

+0.9%

8,747

8,722

+0.3%

-4.5%

15,327

14,107

+8.6%

+5.5%

+16.2%

+16.2%

VINCI Immobilier

811

698

Intragroup eliminations

(622)

(534)

38,634

36,956

+4.5%

+1.5%

Concession subsidiaries’ works revenue

852

1,081

-21.1%

-21.2%

Intragroup eliminations

(303)

(390)

Revenue (*)

Concession subsidiaries’ revenue derived from works carried out by non-Group companies Total consolidated revenue (*) Excluding concession subsidiaries’ works revenue.

550

690

-20.4%

-20.5%

39,183

37,646

+4.1%

+1.1%

114

Report of the Board of Directors

Revenue by geographical area 2012/2011 change (in € millions) France

2012 

% of total

2011

Actual

At constant exchange rates

24,324

63.0%

23,562

+3.2%

+3.2%

Central and Eastern Europe

2,001

5.2%

2,490

-19.6%

-18.5%

United Kingdom

2,257

5.8%

2,071

+9.0%

+2.0%

Germany

2,374

6.1%

2,101

+13.0%

+13.0% +7.0%

Belgium

1,210

3.1%

1,131

+7.0%

Rest of Europe

1,505

3.9%

1,519

-0.9%

-1.5%

Europe excluding France

9,348

24.2%

9,310

+0.4%

-0.9% +35.3%

Americas

1,832

4.7%

1,284

+42.7%

Africa

1,695

4.4%

1,710

-0.9%

-1.1%

Middle East and rest of the world

1,435

3.7%

1,090

+31.6%

+23.5%

International excluding Europe Revenue (*)

4,962

12.8%

4,084

+21.5%

+17.3%

38,634

100.0%

36,956

+4.5%

+3.8%

(*) Excluding concession subsidiaries’ works revenue.

1.3

Operating income from ordinary activities/operating income

Operating income from ordinary activities (Ebit) amounted to €3,671 million in 2012, up 0.3% compared with that of 2011 (€3,660 million). Operating margin from ordinary activities was 9.5% in 2012, against 9.9% in 2011.

Operating income from ordinary activities/operating income (in € millions) Concessions VINCI Autoroutes VINCI Concessions of which VINCI Park

2012 

% of revenue (*)

2011

% of revenue (*) 2012/2011 change

2,159

40.3%

2,149

40.6%

2,019

45.5%

2,018

45.8%

+0.5% +0.1%

139

15.2%

130

14.7%

+6.6%

114

18.5%

107

17.9%

+6.1%

1,403

4.2%

1,435

4.6%

-2.2%

VINCI Energies

502

5.6%

483

5.6%

+4.0%

Eurovia

277

3.2%

322

3.7%

-14.2%

VINCI Construction

625

4.1%

630

4.5%

-0.9%

62

7.6%

54

7.8%

+13.2%

9.5%

3,660

9.9%

+0.3%

9.7%

+1.4%

Contracting

VINCI Immobilier Holding companies Operating income from ordinary activities (**) Share-based payments (IFRS 2)

47 3,671

22

(94)

(101)

Goodwill impairment expense

(8)

(8)

Income/(loss) of companies accounted for under the equity method

82

50

Operating income

3,651

9.5%

3,601

(*) Excluding concession subsidiaries’ works revenue. (**) Operating income from ordinary activities is defined as operating income before the effects of share-based payments (IFRS 2), goodwill impairment losses and the income or loss of companies accounted for under the equity method.

In Concessions, Ebit was €2,159 million, up 0.5% compared with 2011 (€2,149 million). It represented 40.3% of revenue, close to the level achieved the previous year (40.6% of revenue). At VINCI Autoroutes, Ebit was stable at €2,019 million (€2,018 million in 2011). Despite slight growth in revenue in 2012 and firm control over operating expenses, Ebit margin declined from 45.8% to 45.5% in 2012. This was attributable to an increase in special concession amortisation expense following the commissioning of contractual investments, particularly in relation to the green motorway package and road widening works carried out on the A63. At VINCI Concessions, Ebit was €139 million (€130 million in 2011). Ebit margin improved from 14.7% in 2011 to 15.2% in 2012, driven mainly by VINCI Airports’ strong performance. Contracting posted a 2.2% fall in Ebit to €1,403 million (€1,435 million in 2011). As a proportion of revenue, it fell from 4.6% in 2011 to 4.2% in 2012. At VINCI Energies, Ebit rose 4.0% to €502 million (€483 million in 2011) and Ebit margin was 5.6%, the same as in 2011. At Eurovia, Ebit was €277 million, down 14% from €322 million in 2011. As a proportion of revenue, it declined from 3.7% in 2011 to 3.2% in 2012 due mainly to losses in Poland as a result of low business levels following the Euro 2012 football tournament and write-downs of work in progress.

VINCI 2012 Annual Report

115

Report of the Board of Directors

At VINCI Construction, Ebit was €625 million, down 0.9% relative to 2011 (€630 million). Ebit margin was 4.1% in 2012 (4.5% in 2011). This change reflects provisions taken at VINCI Construction Grands Projets following an unfavourable court decision in the USA. Operating income was €3,651 million or 9.5% of revenue in 2012, up 1.4% from €3,601 million or 9.7% of revenue in 2011. It takes into account: Share-based payment expense, which reflects the benefits granted to employees under performance share plans, share option plans and the Group Savings Scheme. It amounted to €94 million in 2012 (€101 million in 2011). ˇˇ Goodwill impairment charges, which amounted to €8 million in 2012, the same as in 2011. ˇˇ The Group’s share in the income or loss of companies accounted for under the equity method, which was positive at €82 million in 2012 (€50 million in 2011). ˇˇ

1.4

Net income

Consolidated net income attributable to owners of the parent amounted to €1,917 million in 2012, up 0.7% compared with 2011 (€1,904 million) and equal to 5.0% of revenue. Earnings per share (after taking account of dilutive instruments) rose 1.6% to €3.54 (€3.48 per share in 2011).

Net income attributable to owners of the parent, by business line (in € millions)

2012 

2011

2012/2011 change

Concessions

886

852

+4.0%

827

820

+0.9%

59

32

+84.4%

VINCI Autoroutes VINCI Concessions Contracting

915

968

-5.4%

VINCI Energies

327

315

+4.0%

Eurovia

167

220

-24.1%

VINCI Construction

421

433

-2.8%

37

33

+12.8%

VINCI Immobilier Holding companies Total

79

52

1,917

1,904

+0.7%

The cost of net financial debt was €638 million, compared with €647 million in 2011. The Group’s policy of converting fixed rate debt to floating rate enabled it to benefit from lower interest rates and this completely offset the fall in returns from investments and the current higher costs of refinancing. The average interest rate on long-term financial debt at 31 December 2012 was 3.63%, (3.93% at 31 December 2011). Other financial income and expense resulted in a net expense of €19 million, compared with net income of €25 million in 2011. For 2012, this item includes capitalised borrowing costs on current investments, mainly at ASF and Escota, in the amount of €71 million, compared with €61 million in 2011. It also includes the negative impact of the cost of discounting retirement benefit obligations and provisions for the obligation to maintain the condition of concession intangible assets – due to lower interest rates – in the amount of €91 million, compared with €47 million in 2011. Capital gains on disposals of securities and receivables amounted to €1 million (€3 million in 2011). Dividends received from unconsolidated entities totalled €17 million in 2012, versus €16 million in 2011. Income tax expense for the year was €969 million (€984 million in 2011), resulting in an effective tax rate of 33.3% in 2012 (33.6% in 2011). This change reflects taxation of some foreign subsidiaries at lower rates. Non-controlling interests amounted to €109 million (€92 million in 2011) and consisted mainly of the share of Cofiroute and CFE income that is not attributable to the owners of the parent.

1.5

Cash flow from operations

Cash flow from operations before tax and financing costs (Ebitda) totalled €5,418 million in 2012, up slightly relative to the €5,366 million achieved in 2011. It represented 14.0% of revenue in 2012 (14.5% in 2011). For the Concessions business (62% of total), Ebitda was stable overall (+0.2%) at €3,372 million or 63.0% of revenue (€3,366 million and 63.6% of revenue in 2011). VINCI Autoroutes’ Ebitda increased 1.0% to €3,087 million (€3,058 million in 2011) and its Ebitda margin improved slightly to 69.5% (69.4% in 2011). Contracting’s Ebitda fell 0.3% to €1,875 million (€1,880 million in 2011) and its Ebitda margin was 5.7% (6.0% in 2011).

116

Report of the Board of Directors

Cash flow from operations (Ebitda) by business line (in € millions)

2012 

% of revenue (*)

2011

% of revenue (*)

2012/2011 change

Concessions

3,372

63.0%

3,366

63.6%

+0.2%

3,087

69.5%

3,058

69.4%

+1.0%

285

31.1%

308

34.7%

-7.5%

1,875

5.7%

1,880

6.0%

-0.3%

VINCI Autoroutes VINCI Concessions Contracting VINCI Energies

532

5.9%

508

5.9%

+4.7%

Eurovia

467

5.3%

524

6.0%

-10.9%

VINCI Construction

876

5.7%

848

6.0%

+3.4%

60

7.4%

55

7.9%

+9.3%

14.0%

5,366

14.5%

+1.0%

VINCI Immobilier Holding companies Total

112 5,418

65

(*) Excluding concession subsidiaries’ works revenue.

1.6

Other cash flows

The net change in the operating working capital requirement and current provisions resulted in an outflow of €37 million in 2012, compared with an inflow of €93 million in 2011. This change is due mainly to an increase in the working capital requirement of Eurovia’s activities in Central Europe (completion of major projects in Slovakia and Poland) and draw downs of project advances in construction. Interest paid decreased €48 million to €595 million in 2012 (€643 million in 2011). Income taxes paid rose €42 million to €979 million (€936 million in 2011) due to the increase in tax payments on account required by French subsidiaries and the payment of French dividend tax. Cash flow from operating activities (*) was €3,865 million, down €73 million compared with 2011 (€3,938 million). After accounting for operating investments net of disposals of €742 million, up 11% relative to 2011 (€668 million), operating cash flow (**) was €3,123 million, close to that of the previous year (€3,270 million). Growth investments in concessions and PPPs totalled €1,140 million (€1,135 million in 2011). They included €1,046 million invested by VINCI Autoroutes in France under the motorway operators’ master plans and the green motorway package (€1,017 million in 2011). In particular, investments made by the ASF group remained very high, increasing from €841 million in 2011 to €861 million in 2012, of which almost 30% related to completion of construction of the Lyon–Balbigny section of the A89. Free cash flow before financial investments amounted to €1,983 million (€2,134 million in 2011), including €841 million generated by Concessions and €738 million by Contracting (€766 million and €1,130 million respectively in 2011). Financial investments net of disposals, including the net debt of acquired companies, represented €598 million, compared with €172 million in 2011. Acquisitions included Carmacks in Canada and NAPC in India by Eurovia, GA Gruppe in Germany by VINCI Energies and the increase in Entrepose Contracting’s stake in Geostock from 25% to 90%. Disposals of shares amounted to €7 million in 2012 (€40 million in 2011). There was also the buy-out of non-controlling interests in Entrepose Contracting (€102 million). This transaction is presented under an item related to “Capital transactions” in the cash flow statement since it did not result in a change of control and is therefore regarded as a transaction between shareholders. Dividends paid in 2012 totalled €1,057 million (€1,036 million in 2011). This includes €979 million paid by VINCI SA, comprising the final dividend in respect of 2011 (€653 million), the interim dividend in respect of 2012 paid in November 2012 (€295 million) and the coupon on the perpetual subordinated bonds issued in 2006 (€31 million). The remainder comprises dividends paid to minority shareholders by some subsidiaries, mainly Cofiroute. Capital increases totalled €336 million in 2012, including €275 million relating to Group savings plans and €61 million relating to the exercise of share options. VINCI also pursued its share buy-back programme, purchasing 17.7 million shares in the market for a total investment of €647 million, which more than offset capital increases. As a result of these cash flows, there was a €63 million reduction in net financial debt during the year ended 31 December 2012. (*) Cash flow from operating activities: cash flow from operations adjusted for changes in operating working capital requirement and current provisions, interest paid, income taxes paid, and dividends received from companies accounted for under the equity method. (**) Operating cash flow: cash flow from operating activities adjusted for net investments in operating assets (excluding growth investments in concessions and PPPs).

VINCI 2012 Annual Report

1.7

117

Report of the Board of Directors

Balance sheet and net financial debt

Consolidated non-current assets amounted to €35.4 billion at 31 December 2012 (€34.8 billion at 31 December 2011). They consisted for the most part of concession assets (€26.5 billion). After taking account of a working capital surplus of €6.7 billion (attributable mainly to the Contracting business), down €120 million compared with 31 December 2011, consolidated capital employed was €28.7 billion at 31 December 2012 (€28.0 billion at the end of 2011). The Concessions business accounted for 87% of total capital employed (90% at 31 December 2011). The Group’s equity increased from €13.6 billion at 31 December 2011 to €14.1 billion at 31 December 2012. This figure includes €735 million relating to non-controlling interests (€725 million at end-2011). The number of shares, excluding treasury shares, was 536,245,294 at 31 December 2012 (540,255,171 at 31 December 2011). Consolidated net financial debt was €12.5 billion at 31 December 2012 (€12.6 billion at 31 December 2011). For the Concessions business, including holding companies, net financial debt stood at €18.1 billion, down more than €800 million relative to 31 December 2011. The Contracting business generated a net cash surplus of €2.1 billion in 2012 (€2.9 billion at the end of 2011), the decline being due mainly to acquisitions in 2012. The holding companies posted a net financial surplus of €3.5 billion at 31 December 2012, stable overall relative to 31 December 2011. The ratio of net financial debt to equity was 0.9 at 31 December 2012, in line with the end-2011 figure. The financial debt-to-Ebitda ratio stood at 2.3, stable compared with that at 31 December 2011. The Group’s liquidity remained very high at €11.5 billion at 31 December 2012. This comprises €5.0 billion of net cash managed and €6.5 billion of unused confirmed credit facilities, including €1.1 billion expiring in 2016 and €5.3 billion expiring in 2017.

Net financial surplus (debt) (in € millions) Concessions VINCI Autoroutes VINCI Concessions Contracting

31/12/2012

Net financial debt/ Ebitda

31/12/2011

Net financial debt/ Ebitda

(18,058)

x5.4

(18,895)

x5.6

838

(16,617)

x5.4

(17,157)

x5.6

540

(1,441)

x5.1

(1,738)

x5.6

2,914

(47)

531

(578)

(136)

90

(226)

2,278

2,293

(15)

3,436

3,392

Eurovia VINCI Construction Total

1.8

298

2,095

VINCI Energies

Holding companies & miscellaneous

2012/2011 change

(12,527)

x2.3

(819)

44

(12,590)

x2.3

63

Return on capital Definitions: Return on equity (ROE) is net income for the current period attributable to owners of the parent, divided by equity excluding non-controlling interests at the previous year end; ˇˇ Net operating income after tax is operating income from ordinary activities, after restating for various items (share in the income or loss of companies accounted for under the equity method, dividends received), less the theoretical tax expense; ˇˇ Return on capital employed (ROCE) is net operating income after tax divided by the average capital employed at the opening and closing balance sheet dates for the financial year in question. ˇˇ

Return on equity (ROE) The Group’s ROE was 14.9% in 2012, down slightly relative to the 2011 figure of 15.5%. (in € millions) Equity excluding non-controlling interests at previous year end Net income for the year ROE

2012 

2011

12,890

12,304

1,917

1,904

14.9%

15.5%

Return on capital employed (ROCE) ROCE was 9.0% in 2012, stable compared with the 2011 figure. (in € millions) Capital employed at previous year end

2012 

2011

27,999

27,766

Capital employed at this year end

28,683

27,999

Average capital employed

28,341

27,883

3,671

3,660

Operating income from ordinary activities

99

66

Theoretical tax (**)

(1,222)

(1,229)

Net operating income after tax

2,548

2,497

9.0%

9.0%

Other items (*)

ROCE (*) Group share of the income or loss of companies accounted for under the equity method and dividends received. (**) Based on the effective rate for the period by business line.

118

2.

Report of the Board of Directors

Parent company financial statements VINCI’s parent company financial statements show revenue of €11.8 million for 2012, compared with €12.7 million in 2011, consisting mainly of services invoiced by the holding company to subsidiaries. The parent company’s net income was €256 million in 2012, compared with €2,997 million in 2011. This includes €324 million of dividends received from Group subsidiaries (€3,006 million in 2011). Expenses referred to in Article 39.4 of the French General Tax Code amounted to €64,675 in 2012. Note C.10 to the parent company financial statements contains the disclosures relating to suppliers’ payment terms required by France’s LME Act on modernising the country’s economy and Article L.441-6-1 of the French Commercial Code.

3. Dividends The Board of Directors has decided to propose to the Shareholders’ General Meeting on 16 April 2013 that the amount of the dividend for 2012 be set at €1.77 per share, the same as for 2011. Taking account of the interim dividend of €0.55 per share paid in November 2012, a final dividend of €1.22 will be paid on 22 May 2013 if approved. It will also be proposed that shareholders be given the option of being paid the final dividend in new shares. The ex-date is set at 23 April 2013. Year Type Amount per share Number of qualifying shares Aggregate amount paid (in € millions) Tax allowance applicable to individual shareholders

2009 

2010 

2011

Interim

Final

Total

Interim

Final

Total

Interim

Final

Total

€0.52

€1.10

€1.62

€0.52

€1.15

€1.67

€0.55

€1.22

€1.77

502,072,342

535,315,906

545,061,260

536,193,431

541,722,314

534,238,617

261.08

588.85

283.43

616.62

297.95

651.77

40%

40%

40%

40%

40%

40%

B. Post-balance sheet events, trends and outlook 1. Material post-balance sheet events 1.1 1.2

ASF bond issue as part of its EMTN programme

In January 2013, as part of its EMTN programme, ASF successfully issued €700 million of 10-year bonds with an annual coupon of 2.875%.

VINCI selected to acquire ANA, the Portuguese airport concession company

On 27 December 2012, VINCI Concessions was selected by the Portuguese government to acquire ANA, the company that holds a 50-year concession contract for the country’s 10 airports: Lisbon, Porto, Faro and Beja on the mainland; Ponta Delgada, Horta, Flores and Santa Maria in the Azores; and Funchal and Porto Santo in Madeira. ANA constitutes a group of high quality airports that handled 30 million passengers in 2011 and has a large proportion of international business. Passenger numbers have increased at an annual average of more than 4% over the past 10 years. The Lisbon hub handles a quarter of all traffic between Europe and Brazil, while traffic to Portuguese-speaking Africa (Angola and Mozambique) is seeing strong growth. In addition to managing airport facilities, ANA’s operations include retail activities, ground handling services, and safety and security. Through the acquisition of ANA, VINCI Concessions subsidiary VINCI Airports will become a significant international player in airport concessions, with 23 airports managed in Portugal, France and Cambodia. These airports handle 40 million passengers a year, including an international hub in Lisbon with over 15 million passengers. VINCI Airports should have revenue of around €600 million and Ebitda of more than €270 million. The transaction, which is expected to complete in the second quarter of 2013, will be submitted for prior approval by the European competition authorities.

2. 2.1

119

Report of the Board of Directors

VINCI 2012 Annual Report

Information on trends Outcome in 2012

When publishing its quarterly results in October 2012, VINCI set its targets as follows: “The good activity during the third quarter of 2012 combined with recent external growth transactions should lead to an approximate 4% increase in the Group’s full-year 2012 top line. “In terms of operating and net incomes, despite the margin pressure being felt in some sectors and countries, VINCI was targeting levels close to those reached in 2011 before taking into account the new tax and social charges being considered in France. “Ongoing discussions surrounding the proposed 2013 French Finance Law (le Projet de Loi de Finances 2013) imply that these new charges could negatively impact VlNCl’s 2012 net income, which could be down by 3% to 4% compared to its 2011 level.” VINCI exceeded the above targets, particularly following adjustments made to parts of the draft 2013 budget applicable in 2012.

2.2

Trends in 2013

At 31 December 2012, the order book of the Contracting business lines (VINCI Energies, Eurovia and VINCI Construction) stood at €31.3 billion. This represents a 2% increase year on year (down 5% in France; up 12% outside France) and equals more than 11 months of average business activity. About two-thirds of the orders are to be executed in 2013. VINCI Energies’ order book totalled €6.8 billion at 31 December 2012, up 5% over the year (down 2% in France; up 18% outside France). It represented nine months of VINCI Energies’ average business activity. Eurovia’s order book amounted to €6.4 billion at 31 December 2012, up almost 10% year on year (down 3% in France; up 22% outside France), representing nearly nine months of Eurovia’s average business activity. VINCI Construction’s order book at 31 December 2012 totalled €18.1 billion, down 1% since 1 January 2012 (down 6% in France; up 6% outside France) and equals more than 14 months of VINCI Construction’s average business activity.

Order book (*) 31/12/2012

of which France

of which outside France

VINCI Energies

6.8

4.2

Eurovia

6.4

2.8

(in € billions)

31/12/2011

of which France

of which outside France

2.5

6.4

4.3

2.1

3.6

5.8

2.9

3.0

VINCI Construction

18.1

10.1

8.0

18.3

10.8

7.5

Total Contracting

31.3

17.2

14.1

30.6

18.0

12.6

(*) Unaudited figures.

On the date of publication of this document, there have been no material changes in the Group’s financial and commercial situation since 31 December 2012, other than those described in note B.1 of this report.

3.

The Group’s markets: seasonality of business Most of the Group’s activities, but particularly roadworks, civil engineering and some concessions, record lower business volumes in the first half of the year than in the second. This is due mainly to less favourable weather conditions. In 2012, the difference in revenue between the two halves was about 13%. The seasonality of the Group’s business is also reflected in the net use of cash in the first half, which is attributable to the lower level of receipts during this period and the pattern of operating cash flows, the majority of which is generated in the second half of the year. Group income and expenses in respect of ordinary activities that are of a seasonal, cyclical or occasional nature are accounted for using the same accounting methods as those adopted for the full-year financial statements. Income and expenses invoiced on an annual basis (e.g. patent and licence fees) are accounted for on a pro rata basis using an estimate for the full year.

120

Report of the Board of Directors

C. Risk factors Numerous internal and external risk factors may threaten the Group’s objectives, as VINCI operates in a complex and changing legislative, regulatory, geopolitical, economic and financial environment. However, in accordance with the Group’s subsidiarity principle, VINCI’s decentralised organisation aims to assess and handle risks at the most appropriate level of responsibility (subsidiary, business line, holding company) depending on their criticality. The general guidelines in conjunction with the resultant risk management and internal control systems of the Group enable the reporting of information to the centre on the main risks and their treatment. Under this process, the major Group entities prepared a risk mapping in 2009 and have updated it periodically. This identified the main risk sources and the more significant events that could hinder the achievement of the Group’s objectives. The consequences of these events are evaluated according to their potential financial, human or reputational impact and the associated probability of occurrence. Preventive measures to reduce the probability of occurrence of such events and their impact have been implemented. Provisions are taken for likely risks, including in particular possible losses on completion of construction projects as specified in Notes 20, 21 and 23 to the consolidated financial statements. Unfavourable economic developments may lead to a decline in public-sector orders and private-sector investment and limit access to financing, subsequently putting pressure on business volumes, prices and the Group’s financial situation. The adaptation of the Group’s products, services and activities to changes in the economic climate constitutes the major challenge vis-à-vis the operational, financial, legal, environmental and technological risks presented below.

1.

Operational risks

1.1 Commitments

Commitments connected to bidding or to the acquisition or disposal of businesses constitute the main risk factor faced by VINCI companies in their various business activities (concessions, energy, roads, construction, property). Risk identification and assessment are taken into account in cost estimates right from the bidding stage of each project. Budgets are then prepared and updated during the contract execution phase.

1.1.1 Bidding

The Group has set up a selective bidding policy, which involves the application of long-standing control procedures for tenders. Before commitments are taken, projects presenting specific risks, in particular those that exceed the thresholds stated in the general guidelines, are reviewed by business line Risk Committees. The VINCI Risk Committee reviews the largest projects. In the Contracting business (VINCI Energies, Eurovia, VINCI Construction), Group companies, through the work of their expertise teams, seek to avoid project performance risks at an early stage through the terms and conditions of submissions, and in particular the associated technical, legal and financial commitments. The Group’s diversity in geographical locations and customers – with some 41% of revenue coming from public-sector clients in the Contracting business – also contributes to risk distribution. At VINCI Construction France, approximately 40% of revenue is generated by contracts that are individually worth less than €5 million. The Group’s policy is to opt for high technical value-added projects, allowing its know-how to be leveraged in countries where the environment is known and manageable. Furthermore, these major projects are often carried out in joint ventures with other companies, which limits the Group’s risk exposure. New public-private partnership (PPP) and concession projects are systematically submitted to VINCI’s Risk Committee for examination and approval. In addition, in order to limit commitments and the amount of risk capital invested by the Group in special purpose vehicles, these projects are generally developed in partnership with other companies and are substantially financed by debt, generally with no or limited recourse against VINCI.

1.1.2

1.1.3

Property commitments

The Group’s property development activities are mainly carried out through its specialised subsidiary, VINCI Immobilier. This company’s activities are concentrated in the Greater Paris area and France’s main conurbations. In 2012, these operations accounted for less than 2% of the Group’s revenue. VINCI Immobilier’s most physical commitments undergo systematic prior examination by the VINCI Risk Committee and are subsequently subject to detailed reporting and regular follow-up by VINCI Immobilier. Some VINCI subsidiaries may also participate in property development transactions as part of their construction activities, most of which are in France. These projects are systematically submitted to the VINCI Risk Committee for prior examination and approval. The Group’s policy is to undertake new projects only if the risks related to the property and construction are under control and if the pre-sale rate is sufficiently high.

Acquisitions and disposals

To limit the risks associated with the integration of newly acquired companies and to be able to apply the Group’s management principles in them, VINCI’s policy is to take a majority interest in acquisitions. Most proposed acquisitions and disposals are submitted to the VINCI Risk Committee for approval. The largest projects are also submitted to the Board of Directors, following examination by the Strategy and Investment Committee (see paragraph 3.4.2 of the section entitled “Corporate governance” contained in the Report of the Chairman of the Board of Directors on corporate governance and internal control procedures, page 183).

VINCI 2012 Annual Report

1.2 1.2.1

Report of the Board of Directors

121

Performance of contracts General risks

In all of its business lines, VINCI’s subsidiaries are exposed to risks that can affect satisfactory performance. These relate to the following fields: Human resources management VINCI’s success resides in the quality of its managerial model and its ability to attract, train and motivate its employees. Group companies are exposed to events capable of affecting this resource: employee departures, difficulties connected with recruitment and training in key job functions (management, supervisory and specialist trades), employees’ health and safety, personnel costs and industrial action. VINCI considers the health and safety of its personnel and third parties involved with or affected by its operations to be a major priority. It has therefore set up a health and safety policy, which includes, in addition to accident prevention measures, actions relating to occupational illnesses and pandemics. VINCI has set up a workforce planning system to handle the risks related to the availability and/or suitability of technical, administrative or financial staff at management, white- and blue-collar worker level. This system is intended to anticipate future workloads and the resources needed. Detailed information on VINCI’s social responsibility approach is given in the Report of the Board of Directors – E. Social and environmental information, on page 138. Cost increases VINCI is potentially exposed to cost increases, particularly in the prices of some commodities and materials (examples include oil products, steel and cement). These issues are analysed for each core business in section 1.2.2. below. Commodities risk is also covered in section 2.3. Subcontractors, joint contractors and suppliers The quality of work done by other companies working with VINCI and sometimes their default may affect the satisfactory performance of projects. Given the diverse nature of VINCI’s business activities and its decentralised organisation, which reflects the essentially local character of its markets, the Group considers that it has little dependence on any given subcontractor, joint contractor or supplier. VINCI companies usually guard against this type of risk by selecting partners carefully, monitoring progress and taking any corrective measures needed during the project life. Security context and social, political or economic unrest (country risk) Given the large number of countries where the Group operates, some activities may occasionally be affected by industrial action, various forms of political unrest (riots, terrorism, armed conflict, embargoes, seizure of equipment, etc.), as well as malevolent acts such as vandalism and theft on construction sites, or criminal acts such as kidnapping. VINCI’s Safety/Security Department makes information available to business lines to ensure the best possible preparation for work and travel, and makes recommendations to ensure the protection of people and goods. It can also be called on to conduct site audits and/or implement regularly updated security plans. Moreover, it intervenes within the framework of crisis management, in particular for staff evacuation. In addition to the aforementioned events, malevolent acts may include cyber attacks and fraud attempts. The Group’s Finance Department, in conjunction with the Safety/Security Department, has set down the instructions to follow in such cases. The economic situation in Europe and/or a slowdown in emerging economies’ growth could lead to a worsening of conditions in markets where VINCI operates. Across its Contracting business lines, VINCI generates over 57% of total revenue in France, 85% in Europe and more than 3% in North America. In 2012 Concessions generated 94% of revenue in France (essentially VINCI Autoroutes), 97% in Europe and, hence, only 3% outside of Europe, of which more than one-third was in North America. Country risk is analysed prior to the submission of the tender for new projects and is monitored by indicators established on site for projects or current operations (see Report of the Chairman of the Board of Directors on corporate governance and internal control procedures, page  188). The various property operations conducted by VINCI Immobilier or VINCI Construction subsidiaries are handled mainly in France. Financial risk is analysed in paragraph 2.3. Natural events Like any other company, VINCI may be affected by natural events (e.g. earthquakes, floods, cyclones, windstorms, lightning, etc.), which can interrupt operations or trigger the collapse or accidental destruction of Group infrastructure assets under construction or in use. Such events may result in an interruption to business for the relevant entity and could also entail a substantial hike in the costs involved in maintaining or repairing facilities. Part of these expenses may be borne by insurance policies. As for crisis management, the actions to be undertaken and training provided entail alert procedures, the triggering of crisis measures, and the management of and exit from crises. This central organisation is cascaded in the Group’s subsidiaries, which have also set up their own crisis management and communication arrangements.

122

1.2.2

Report of the Board of Directors

Risks specific to VINCI’s business lines

The VINCI companies within each of the Group’s business lines are exposed to events, the prevention, control and daily management of which lie at the heart of their business. Concessions and public-private partnerships (PPP) Some risks may remain with the granting authority, in particular in relation to making land available. However, default by the authority cannot be ruled out. Risks connected with design and construction are generally transferred by the special purpose vehicles (SPVs) holding the PPP or concession contract to the contractors in charge of construction. Financing risks, however, remain the responsibility of the SPVs and their shareholders (see section 2.4). Regarding concessions operation, the main risks relate to changes in traffic levels or infrastructure usage, and customer-users’ acceptance of tolling and toll charges whenever toll receipts account for virtually all the revenue. Traffic levels on motorway concessions are correlated to economic activity, especially heavy goods vehicle traffic. They may also be affected by fuel prices, whether for heavy or light vehicles. Risks connected with changes in the legal and regulatory environment during the lifetime of contracts must be assessed on the basis of the contractual framework governing their terms. This framework may or may not provide for compensation mechanisms applying in the event of changes in the legislative, regulatory or tax framework, or in the event of the contract’s early termination. Concession companies’ toll increases, in particular for motorway tolls, are generally linked to inflation. These companies are therefore exposed to a contraction in the inflation rate. The Group’s reputation may be tarnished in the event of default in the quality of services provided (maintenance of the road network, vehicle recovery, exceptional events management, required performance levels). A centralised system involving public order authorities has been established in VINCI Autoroutes to combat toll fraud. For motorway infrastructure, the cost of renewing surface courses, the wear of which is related to traffic intensity, is covered by heavymaintenance provisions, as specified in Note 21.3 to the consolidated financial statements (page 244). The main financial, legal and regulatory risks are described in paragraphs 2 and 3 dealing respectively with Financial and Legal risks, below. Contracting (VINCI Energies, Eurovia, VINCI Construction) The relationship between the Group’s businesses and their clients may be deteriorated by unilateral decisions taken by the latter (early contract termination) or by their default (late payments or even insolvency). As such, measures to manage contracts, cash flow and components of working capital needs are set up and closely monitored. Obtaining official authorisations (in particular planning permission, environmental permits and acceptance certificates prior to commissioning) may represent unknowns that are managed on a case-by-case basis by clearly planning the various steps preceding the construction and acceptance of the structure. The timetable and/or construction cost can differ from bid estimates as both depend on a wide range of parameters, some of which are difficult to anticipate such as: ˇˇ weather conditions (see “Natural events”, above); ˇˇ changes in the cost of labour, subcontracting, materials, commodities and energy (see above). Risks relating to changes in costs are handled in different ways: ˇˇ the use of revision clauses and the short duration of most contracts mitigate but do not eliminate unit cost inflation risk; ˇˇ although VINCI bears the risk relating to its own personnel costs directly, the risk of hikes in outsourcing costs may be transferred to subcontractors and suppliers by means of fixed-price agreements with them. Commodity price exposure varies according to business activities. Oil prices mainly affect Eurovia, which uses bitumen to build roads, fuel oil for industrial facilities and petrol/diesel for its equipment fleet. This risk is dealt with under market risks in section 2.3. It is worth noting that Eurovia sources 37% of its aggregates from Group quarries. A lack of qualified personnel or inadequate staffing levels may lead to lower-than-expected yields or design or construction errors, leading to technical noncompliance, quality shortfalls of the works and even accidents affecting individuals (company, partner employees or third-party individuals), the works or other goods. These damages associated with possible repairs to remedy these problems may give rise to additional costs and delays in completion. The subsidiary’s reputation may also be affected. However, this risk is reduced by the Group’s arrangements for recruiting and training operational staff (see 1.2.1). For large projects, the technical complexity of the design and construction of unique infrastructure assets, site constraints (presence of underground utilities, maintenance of traffic during works, actions of local residents or other third parties), and geological conditions may also represent significant threats. Some of the Group’s activities may also be affected by the environmental and technological risks described in paragraph 4.

VINCI 2012 Annual Report

Report of the Board of Directors

123

Property The Group’s property development activities are exposed to numerous administrative, technical, commercial and fiscal uncertainties that may result in delays (or even the abandonment of some projects), budget over-runs and incertitude regarding programme selling prices.

2. 2.1

Financial risks Counterparty risk and credit risk

The Group is exposed to counterparty risk stemming from contracts and financial instruments contracted with its financial partners, should the debtor refuse to honour all or part of its commitment or be unable to do so. Counterparty risk may result in either a loss of value or a loss of liquidity. The Group is exposed to loss of value in its cash investments, the acquisition of negotiable debt securities, marketable securities, financial receivables, derivative instruments and guarantees or sureties received. It is exposed to a loss of liquidity on the amounts of its unused confirmed credit facilities. VINCI is also exposed to credit risk in the event that a customer fails, as described in section 1.2.2. The Group has also implemented procedures to manage and limit counterparty and credit risk as specified in Note 23.5 to the consolidated financial statements, page 256.

2.2

Liquidity risk

Group liquidity must be evaluated via its cash and confirmed unused credit lines. The Group’s exposure to liquidity risk relates to its obligations to repay its existing debt (disclosed in Note 22.2.1 to the consolidated financial statements, page 248), to the financing of its future needs associated in particular with concession companies’ investment programmes (see Note 9 to the consolidated financial statements, page 224) and with the Group’s general needs. Details of these obligations and the Group’s resources to meet them (cash flow surpluses, unused confirmed credit lines, financial ratings, etc.) are given in Note 22 to the consolidated financial statements on page 245. The Group diversifies its funding sources by using the bond markets, banks and supranational banking organisations such as the European Investment Bank (EIB). Details of these sources are specified in Note 22 to the consolidated financial statements, page 245. Net cash is managed in accordance with the provisions specified in Note 22.2.2 to the consolidated financial statements, page 249, backed by reporting which specifies the yield of various assets and monitors the level of associated risks. Some financing agreements include pre-payment clauses in the event of non-compliance with financial ratios and covenants. These are described in Note 22.2.5 to the consolidated financial statements, page 250. The thresholds imposed on these ratios were being complied with at 31 December 2012.

2.3

Market risks (interest rate, currency, commodity and equity risks)

Because of its level of net borrowings, VINCI is exposed to interest rate variations (mainly in the eurozone) relating to its floating-rate debt and to changes in credit spreads applied by lenders. VINCI is also exposed to currency risk stemming from its activities outside France. However, these risks are relatively limited, because about 26% of revenue is generated outside the eurozone. Management of interest rate and foreign exchange risks is explained in Notes 23.1 and 23.3 to the consolidated financial statements, pages 251 and 254. As stated in Notes 1.2.2 and 23.4 to the consolidated financial statements, a large share of the Group’s revenue is generated under short-term contracts or contracts containing price-indexing clauses. Unprocessed raw materials form a relatively small proportion of cost structures. As a general rule, the risk on commodity price increases is fairly limited. In the case of large-scale contracts with non-revisable prices, commodity risks are assessed on a case-by-case basis and managed, whenever possible, using suitable methods such as: ˇˇ firm price agreements with suppliers for a given time period; ˇˇ cash-and-carry deals, with supplies bought or paid for by the client at the beginning of the work project; ˇˇ more marginally, hedging derivatives based on commodity indexes, particularly where the supplier uses a price review mechanism based on an index that can be hedged in financial markets, etc. Equity risk relates to shares held by VINCI: ADP, assets to cover retirement benefit obligations, and treasury shares. This risk is described in Note 23.2 to the consolidated financial statements, page 254, and point 3 in Note C3 (Treasury shares) to the parent company financial statements, page 283.

2.4 Impact of public-private partnerships (PPPs) and concession contracts on the Group’s financial situation

Following review by the Risk Committee of the business line concerned, these projects are submitted to the VINCI Risk Committee for examination and approval. Projects are generally carried out through special purpose vehicles (SPVs) dedicated solely to the project. These SPVs are financed by loans made directly to them, with little or no recourse against their shareholders, backed by the future revenues or receivables while minimising the capital outlay. The latter varies according to the nature of the risks involved (e.g. traffic volumes and country), the amount of project financing and the share of financing assured by the concession-granting authority. Floating-rate debt raised by SPVs is generally covered by fixed-rate hedges for a very large proportion in accordance with the commitments made to lenders.

124

3. 3.1

Report of the Board of Directors

Legal risks Legal and regulatory compliance

Given the diversity of their activities and geographical locations, the Group’s companies operate within specific legal and regulatory environments that vary depending on the place where the service is provided and on the sector involved. In particular, they must comply with rules on: ˇˇ the terms of agreement and performance of public- and private-sector contracts and orders; ˇˇ laws governing construction activities and the applicable technical rules governing the delivery of services, supplies and works; and ˇˇ environmental, commercial, labour, competition, finance and securities laws. With respect to concession operations, the Group is dependent on public authorities that may, as is the case in France, have the right to unilaterally alter the terms and conditions of public service, PPP and concession contracts during their execution phase or even terminate the contract itself, subject to compensation. Group companies’ operations could result in them being held civilly or criminally liable in France and other countries and in them bearing the financial or administrative consequences. Similarly, Group executives and employees may also be held criminally liable. A large share of the risks of non-compliance is therefore likely to lie firstly with executives and/or company officers and with employees to whom responsibility has been delegated. Business lines regularly hold awareness-raising and training sessions based on the Group’s Code of Ethics and Conduct in order to limit these risks and in particular to prevent conflicts of interest and anti-competitive conduct. The Group’s commitments are described in the “Social responsibility” chapter, page 159. The financial risks relating to the potential invoking of Group companies’ civil liability are covered by insurance policies described under paragraph 5 “Insurance cover against risks” (see below). The Report of the Chairman of the Board of Directors on corporate governance and internal control procedures includes a paragraph on compliance with laws and regulations in force, page 179.

3.2

Contractual relationships

All the Group’s business activity is based on contracts, mostly subject to the laws of the countries where the project is carried out, engaging the responsibility of the contracting parties. Disputes may arise during the performance of said contracts. The Group’s policy is to reduce its exposure by negotiating, in the proposal phase, clauses in order to: ˇˇ pass onto the client the extra costs and/or delays stemming from changes in the client’s requests; ˇˇ allow project shutdown in case of non-payment; ˇˇ exclude indirect damages; ˇˇ exclude or limit responsibility related to existing pollution; ˇˇ limit its contractual responsibility for the total project to a reasonable percentage of the contract’s price; ˇˇ cap delay and performance penalties to an acceptable percentage of the contract price; ˇˇ stipulate contractual provisions allowing for adjustments (price, time schedule) to account for legal, fiscal or regulatory changes; ˇˇ obtain protection via a force majeure clause (against political risk, client’s unilateral decision) or for early contract termination; ˇˇ obtain an international arbitration clause for contracts outside France. Detailed information on the principal disputes and arbitrations in which the Group is involved can be found in section H of the notes to the consolidated financial statements, page 265. These known disputes are examined on the date of approval of the financial statements and, following the review by legal advisers, the provisions deemed necessary are, as the case may be, constituted to cover the estimated risks.

4.

Environmental and technological risks Environmental risks are those that have an impact on the natural environment. They may be directly linked to: ˇˇ the occurrence of technological accidents; ˇˇ the usage, handling or transport of hazardous substances; ˇˇ the emission or release into the air or water of toxic and hazardous substances, waste or CO . 2 Technological risk, which stems from human activity, entails accidents occurring in industrial or nuclear installations.

4.1

Environmentally related economic and regulatory context

The sources of environmentally related risks and opportunities are essentially concentrated in two fields: ˇˇ the competitive market with opportunities generated by growth in client demand for renewable energy generation or for products that consume less energy (low energy buildings); ˇˇ legal and regulatory compliance resulting from international or national changes in environmental protection regulations, which are often made stricter, in particular to reduce greenhouse gas emissions or conserve biodiversity.

VINCI 2012 Annual Report

Report of the Board of Directors

125

Only one VINCI facility is concerned by France’s national greenhouse gas quota plan (PNAQ II): CIFC’s plant (part of Eurovia) at Fos sur Mer near Marseille. An approved auditor verifies the regulatory quota compliance of emissions by no later than 15 February each year. The CO2 emitted by the CIFC facility totalled 171,314 tonnes in 2012 due to a significant increase in production. As in 2011, no CO2 sales were reported in 2012. (As with other environmental indicators, these figures are calculated over the period from 1 October of year Y-1 to 30 September of year Y: see “Note on the methods used in social and environmental reporting, page 166”.)

4.2

Environmental risks

Some Eurovia businesses may face exposure to these risks, which remain limited. Binder plants: the use or manufacture of products that are potentially hazardous to the environment is subject to continuous monitoring and internal inspections by Eurovia’s quality, health, safety and environment managers. Production and application of bituminous mixes: the setting up of an environmental regulation intelligence group for bituminous mix plants enables the plant operators to take the action needed to ensure permanent compliance with regulations. Regular or unannounced external inspections analyse products and measure the quantities in stock to ensure that the plants comply with regulations. Performance techniques for applying bituminous mixes on worksites are regularly monitored in close conjunction with the relevant health and safety bodies. Quarries: the sources of pollution identified include noise, vibration and dust emissions. External audits of quarries are made annually by approved organisations. Dust emissions are inspected in accordance with standards by an external body and a report is submitted annually to the regional departments for industry, research and the environment (Drire). Because these risks are limited, no special system has been set up to monitor the costs and investments associated with their prevention. However, all identified risks are analysed on a case-by-case basis and provisions are made where necessary. At 31 December 2012, provisions related to Eurovia, where the main risks in this area lie, amounted to €22.6 million, including €11.3 million in France. Corresponding provisions identified in VINCI’s other subsidiaries stood at around €1 million. As a general rule, VINCI’s companies are potentially exposed to the consequences of accidental pollution, in particular spillage of hazardous materials on its roads network and construction sites. This type of event, which is fortunately rare, can disrupt the particular site or operations and necessitate the deployment of crisis arrangements (see section 1.2.1, paragraphs Security and social, political or economic context (country risk) and Natural events).

4.3

Technological risks

The Group’s companies have no facilities that present significant health or safety risks for neighbouring populations and the environment, as defined under clause IV of Article L515-8 of the French Environmental Code (Seveso High Threshold). They can, however, be indirectly exposed to such risks in the following cases: some of the Group’s activities may be carried out occasionally or permanently near facilities classified for environmental protection; ˇˇ some activities carried out by VINCI Energies and VINCI Construction (Freyssinet, VINCI Construction France, Soletanche Bachy, CFE, VINCI Construction Grands Projets, Entrepose Contracting, etc.) take place inside classified facilities (in particular, nuclear power plants or nuclear waste treatment facilities). Those responsible for such facilities are subject to obligations and must take the necessary measures, especially as regards evacuating people. ˇˇ

5. 5.1

Insurance cover against risks General policy

VINCI’s general insurance policy places a strong emphasis on prevention and risk protection. Given the Group’s decentralised organisation, this policy is defined at several levels of responsibility. VINCI’s Executive Management lays down the general guidelines and in particular the standards applicable to all subsidiaries. Within this framework, and after rigorously identifying and analysing the risks relating to their activities, the managers of the business lines or major subsidiaries define the optimum trade-off between the level and extent of the guarantees likely to meet the range of insurable risks, and a cost (comprising premiums and uninsured losses) allowing business units to remain competitive. With a view to preventing accidents and optimising costs, uninsured losses are defined on an individual subsidiary basis. Self-insurance budgets have been set up for civil liability, motor vehicle insurance and damage insurance at Eurovia, VINCI Construction France and VINCI Energies. In addition to subsidiaries’ specific cover, VINCI has also taken out cover on behalf of all its subsidiaries, in particular regarding: supplementary civil liability cover in addition to the first levels of cover arranged by subsidiaries; ˇˇ civil liability protection for company officers; ˇˇ liability for environmental damage. ˇˇ

VINCI has its own brokerage firm, VINCI Assurances, in charge of consolidating insurance policies and harmonising cover within the Group. VINCI Assurances acts as a broker for most of the French subsidiaries and, as an intermediary, bears no financial risk as an insurer.

126

5.2

Report of the Board of Directors

Loss prevention and claims record

Loss prevention arrangements are systematically adopted on construction sites and operating sites. This policy, which gives a major role to training, forms part of VINCI companies’ approach in the areas of quality assurance and prevention of work-place accidents. The Group’s claims record in the area of civil liability is characterised, on the basis of available statistics and data and without prejudging any actual responsibility, by a low number of incidents involving more than €1 million, by a few medium-sized incidents, ranging from €100,000 to €1 million, and by a relatively irreducible number of small incidents (some several thousand) of less than €100,000 each, which, to a great extent, are borne directly by subsidiaries as uninsured losses or under self-insurance cover.

5.3

Insurance in the Construction, Roads and Energy business lines Civil liability Subsidiaries are exposed to their responsibility for bodily, physical or immaterial damage caused to third parties, including Clients or Employers. The civil liability cover taken out by the Group comprises a first line that combines the cover in place at subsidiary level, intended to cover usual incidents, and a set of complementary lines taken out for the common benefit by VINCI. In addition to this basic cover, specific insurance is taken out as a result of legal or contractual requirements or management decisions, particularly in areas such as: ˇˇ 10-year liability (in France); ˇˇ motor insurance. Property insurance Contractor’s All Risks (CAR) insurance is generally taken out in respect of major construction sites. In particular, this covers physical damage arising from accidents or natural events up to the value of the project as a maximum. Office buildings and fixed production facilities are covered for a contractual rebuilding value, either value as new or an estimate of the maximum insurable loss. Site plant and equipment is covered on a case-by-case basis and, if financially worthwhile, depending on value, type and age. Road vehicles, which are mostly pooled within fleets by subsidiary, are not generally covered on a comprehensive basis.

5.4

Insurance in concessions and services business lines Property insurance Concession operation involves a potential exposure of the Group to damage to assets under concession, whether accidental or not, that could result in an obligation to rebuild (bearing the related costs), as well as to financial consequences due to the interruption of operations and obligations to providers of finance relating to debt servicing. As a general rule, bridges, tunnels and car parks are insured from their entry into service for their cost of reconstruction in the event of accidental destruction. This is not, however, the case for motorways and rail lines where complete destruction is not envisaged. Civil liability Assets operated under concession contracts by VINCI subsidiaries in France or abroad are also covered by specific civil liability insurance arrangements, which are coordinated with the complementary cover at Group level. To date, no claim has been settled under these further lines of insurance in the concessions and services business lines. These arrangements are specifically designed to meet local legal requirements and those laid down in concession agreements. Concession operations in which VINCI is a minority shareholder do not generally benefit from the Group’s complementary civil liability cover taken out on behalf of all entities. Business interruption insurance Business interruption insurance is intended to allow concession operators to restore an income stream interrupted or reduced by an accidental event affecting the normal operation of an asset, thus enabling the operator to meet any financial commitments towards lenders and cover ordinary operating overheads during the reconstruction period. For bridges, tunnels and car parks, losses from interruption to business are generally covered subject to various levels of uninsured loss. Losses may be expressed as an amount or as a number of days of interruption. Long motorways and rail lines, which have little exposure to this risk, are not systematically insured against such losses since a long-term or complete stoppage of operations is not taken into consideration. Uninsured amounts are determined on a case-by-case basis to ensure that the concession’s earnings are not materially affected by an accidental interruption in traffic.

127

Report of the Board of Directors

VINCI 2012 Annual Report

D. Company officers and executives 1.

Company officers’ appointments and other positions held

The table below details the appointments and other positions held by: the 13 members of the Board of Directors; ˇˇ the two individuals whose appointments as Directors are proposed to the Shareholders’ General Meeting of 16 April 2013; ˇˇ the Director whose term of office expired in 2012. ˇˇ

1.1

Directors in office

Xavier Huillard Chairman and Chief Executive Officer, VINCI

Other appointments and positions held at 31/12/2012

Age: 58

Chairman of VINCI Concessions Management SAS; Director of VINCI plc and of VINCI Investments Ltd; Chairman of the Supervisory Board of VINCI Deutschland GmbH; permanent representative of VINCI on the Boards of Directors of VINCI Energies and Eurovia, of Snel on the Board of Directors of ASF, of VINCI Concessions on the Board of Directors of ASF Holding and of VINCI Autoroutes on the Board of Directors of Cofiroute; Chairman of the Fondation VINCI pour la Cité.

Nationality: French Number of VINCI shares held at 31/12/2012: 448,363 Director since 2006 Term of office ends: 2014 Shareholders’ General Meeting Address: VINCI 1 cours Ferdinand de Lesseps 92500 Rueil Malmaison, France Yves-Thibault de Silguy Vice-Chairman and Senior Director of the Board of Directors, VINCI Chairman of the Strategy and Investments Committee and of the Appointments and Corporate Governance Committee Age: 64 Nationality: French Number of VINCI shares held at 31/12/2012: 45,678 Director since 2000 Term of office ends: 2014 Shareholders’ General Meeting Address: VINCI 1 cours Ferdinand de Lesseps 92500 Rueil Malmaison, France

Élisabeth Boyer Director representing employee shareholders Member of the Strategy and Investments Committee Age: 58 Nationality: French Number of VINCI shares held at 31/12/2012: 0 Director since 2011 Term of office ends: 2015 Shareholders’ General Meeting Address: Cofiroute-Campus Centre d’Exploitation de Saint Romain Les Cormins 41140 Saint Romain sur Cher, France

Appointments and positions that have expired during the last five financial years Within the VINCI Group Chairman of VINCI Concessions SAS; Chairman and Chief Executive Officer of VINCI Concessions SA; Chairman of the Board of Directors of VINCI Concessions SA; Director of Soletanche Freyssinet and Cofiroute; member of the Supervisory Board of VINCI Energies Deutschland GmbH.

Background Xavier Huillard is a graduate of the École Polytechnique and the École Nationale des Ponts et Chaussées. He has spent most of his working life in the construction industry in France and abroad. Mr Huillard joined Sogea in December 1996 as Deputy Chief Executive Officer in charge of international activities and specific projects, and then became its Chairman and Chief Executive Officer in 1998. He was appointed Deputy General Manager of VINCI in March 1998 and was Chairman of VINCI Construction from 2000 to 2002. He was appointed Co-Chief Operating Officer of VINCI and was Chairman and Chief Executive Officer of VINCI Energies from 2002 to 2004, then Chairman of VINCI Energies from 2004 to 2005. Mr Huillard became Director and Chief Executive Officer of VINCI in 2006 and was appointed Chairman of the Board of Directors and Chief Executive Officer of VINCI on 6 May 2010. He was appointed Chairman of the Institut de l’Entreprise on 18 January 2011. Other appointments and positions held at 31/12/2012

Appointments and positions that have expired during the last five financial years

Within the VINCI Group Permanent representative of VINCI on the Board of Directors of ASF.

Chairman of the Board of Directors of VINCI.

Outside the VINCI Group in listed companies Director of LVMH (France) and of Solvay (Belgium).

Director of SMEG (Monaco), of VTB (Russia) and of Suez Tractebel (Belgium).

In unlisted companies or other structures Chairman of the Supervisory Board of Sofisport; Managing Director of YTSeuropaconsultants; Managing Partner of Ysilop Consulting SARL; Director of VTB France; member of the Board of Directors of the Fondation du Collège de France; trustee of the IASC Foundation; Vice-Chairman Medef International and Chairman of the FranceQatar committee of Medef International; Chairman of the Board of Directors of AgroParisTech; member of the Conseil des Affaires Etrangères (Foreign Affairs Council).

Member of the Advisory Group of ING Direct (France); Chairman of the France-Algeria committee of Medef (the French employers’ organisation); member of the Conseil Économique de Défense (Economic Defence Council).

Background Yves-Thibault de Silguy has a degree in law from the Université de Rennes, a Masters degree in public law, and is a graduate of the Institut d’Études Politiques de Paris, public service section, and the École Nationale d’Administration. From 1976 to 1981, he worked at the French Ministry of Foreign Affairs and for the European Commission from 1981 to 1985. He then worked at the French Embassy in Washington as a Counsellor (economic affairs) from 1985 to 1986. From 1986 to 1988, Mr de Silguy was an adviser in the Prime Minister’s office with responsibility for European affairs and international economic and financial affairs. From 1988 to 1993, he headed the international affairs department of the Usinor Sacilor Group, before being named its Director for International Affairs. From 1993 to 1995, he was Secretary-General of the Interdepartmental Committee for Questions of Economic Cooperation in Europe and at the same time, adviser for European affairs and vice-sherpa in the Prime Minister’s office, assisting in the preparation of summits of the industrialised nations. From 1995 to 1999, Mr de Silguy was European Commissioner responsible for economic, monetary and financial affairs. From 2000 to 2005, he was Chairman of Medef’s European Policy Committee. In January 2000, he became a member of the Executive Board of Suez Lyonnaise des Eaux, of which he was Chief Executive Officer from 2001 to 2003. He was then Executive Vice-President of Suez from 2003 until June 2006. Mr de Silguy was appointed Chairman of the Board of Directors of VINCI on 1 June 2006 and resigned from all his appointments at Suez. Since 6 May 2010, he has been Vice-Chairman of VINCI and Senior Director of the Board. Other appointments and positions held at 31/12/2012

Appointments and positions that have expired during the last five financial years Within the VINCI Group

Trade union representative and full member of the Cofiroute works council. In unlisted companies or other structures Chairman of the Supervisory Board of the Castor and Castor Relais corporate mutual funds. Background Trained in banking, Élisabeth Boyer spent 19 years at BNP Paribas, where she headed a department responsible for managing customer accounts and for the analysis of the income statements of several branch groups in the Paris region. Subsequently, she founded and operated a newsstand-bookstore and then a restaurant. She later worked as an insurance and asset management adviser at AGF. Ms Boyer joined Cofiroute in 2000 as an operations centre supervisor. She is currently an operations control centre supervisor.

128

Robert Castaigne Former Chief Financial Officer and former member of the Executive Committee, Total Member of the Audit Committee and of the Remuneration Committee

Report of the Board of Directors

Other appointments and positions held at 31/12/2012

Appointments and positions that have expired during the last five financial years

Outside the VINCI Group in listed companies Director and member of the Audit Committee of Sanofi; Director and member of the Audit, Internal Control and Risk Committee of Société Générale.

Age: 67 Nationality: French Number of VINCI shares held at 31/12/2012: 1,038 Director since 2007

Director and member of the Audit Committee of Compagnie Nationale à Portefeuille (Belgium); Chairman and Chief Executive Officer of Total Nucléaire and of Total Chimie; Director of Elf Aquitaine, of Total Gestion Filiales, of Hutchinson, of Total Gabon, of Petrofina (Belgium), of Omnium Insurance & Reinsurance Company Ltd (Bermuda) and of Total Upstream UK Ltd.

Background Robert Castaigne is a graduate of the École Centrale de Lille and the École Nationale Supérieure du Pétrole et des Moteurs. He also holds a doctorate in economics from Université de Paris 1 – Panthéon-Sorbonne. He was an engineer at Total from 1 January 1972 and Chief Financial Officer and member of the Executive Committee of Total from June 1994 to May 2008.

Term of office ends: 2015 Shareholders’ General Meeting Address: Total 12 rue Christophe Colomb 75008 Paris, France François David Honorary Chairman, Coface SA Member of the Remuneration Committee

Other appointments and positions held at 31/12/2012

Outside the VINCI Group in listed companies Director of Rexel; member of the Supervisory Boards of Areva and of Lagardère SCA.

Age: 71 Nationality: French

Appointments and positions that have expired during the last five financial years

In unlisted companies or other structures Member of the Council of the Order of the Legion of Honour.

Number of VINCI shares held at 31/12/2012: 1,184 Director since 2003 Term of office ends: 2013 Shareholders’ General Meeting Mr David’s term of office will end at the close of the Shareholders’ General Meeting on 16 April 2013 Address: Coface 12 cours Michelet La Défense 10 92065 Paris la Défense, France

Background François David has a degree in sociology, and is a graduate of the Institut d’Études Politiques de Paris and the École Nationale d’Administration. After holding various positions in government departments between 1969 and 1990, he was International Managing Director of Aérospatiale between 1990 and 1994. He was Chairman of the Board of Directors of Coface from 1994 to 2012, Chairman of the Supervisory Board of Coface Deutschland from 1996 to 2012, and Chairman of the Board of Directors of Coface Assicurazioni from 1997 to 2012. In 2008, he was appointed to the Supervisory Boards of Areva and of Lagardère SCA. Mr David has also written several books. He has been Honorary Chairman of Coface SA since 2012.

Patrick Faure

Other appointments and positions held at 31/12/2012

Chairman, Patrick Faure et Associés Member of the Appointments and Corporate Governance Committee

Director of Cofiroute.

Age: 67

Appointments and positions that have expired during the last five financial years Within the VINCI Group

Outside the VINCI Group in listed companies

Nationality: French

Chairman and Chief Executive Officer of Renault Sport; Chairman of the Board of Directors of Renault F1 Team Ltd and of Benetton Formula; Director of Compagnie Financière Renault, Compagnie d’Affrètement et de Transport, ESL & Network, Giat Industries, AB Volvo, Renault Agriculture and Grigny UK Ltd; Deputy Chief Executive Officer and member of the Executive Committee of Renault.

Number of VINCI shares held at 31/12/2012: 5,103 Director since 1993 Term of office ends: 2013 Shareholders’ General Meeting Mr Faure’s term of office will end at the close of the Shareholders’ General Meeting on 16 April 2013 Address: Patrick Faure et Associés 18 quai de Béthune 75004 Paris, France

Chairman of Coface Services, of Coface Deutschland and of Coface Assicurazioni (Italy); Chairman and Chief Executive Officer of Coface SCRL Participations and of Coface SCRL; Chairman of the Board of Directors of Coface Expert; Chairman of the Supervisory Board of AKC (Allgemeine Kreditversicherung Coface) AG; Director of EADS; Chairman of ICISA (International Credit Insurance and Surety Association).

In unlisted companies or other structures Director of ESL & Network and of Waterslim (Luxembourg).

Chairman of the Board of Directors of Ertico; Chairman of the FranceAmériques Association. Background

Patrick Faure is a graduate of the Institut d’Études Politiques de Paris and the École Nationale d’Administration. From 1979 onwards he held various positions with Renault including that of Manager of Renault Austria from 1981 to 1982 and of Renault UK from 1982 to 1984. In 1984, he was appointed central public relations manager of Renault and in July 1985 became manager of public relations and communication. In January 1986, Mr Faure became Vice-President of Renault, and then Company Secretary of the Renault Group in January 1988. In January 1991, he was appointed Deputy General Manager, Marketing Director and Chairman of Renault Sport. Mr Faure served as Executive Vice President and as a member of the Executive Committee of Renault until 1 January 2005. He was also Chairman and Chief Executive Officer of Renault Sport and Chairman of the Board of Directors of Renault F1 Team Ltd until 2006.

VINCI 2012 Annual Report

Dominique Ferrero Adviser to the Chairman of Natixis Member of the Appointments and Corporate Governance Committee Age: 66

129

Report of the Board of Directors

Other appointments and positions held at 31/12/2012

Appointments and positions that have expired during the last five financial years

Outside the VINCI Group in listed companies Permanent representative of Natixis on the Board of Directors of Natixis Private Equity.

Nationality: French Number of VINCI shares held at 31/12/2012: 2,294

Member of the Management Board and Chief Executive Officer of Natixis; permanent representative of Natixis on the Boards of Directors of Natixis Global Asset Management and Coface; Chairman of the Management Board of Ixis Corporate & Investment Bank (Ixis CIB).

Background

Address: Natixis 5-7 rue de Monttessuy 75007 Paris, France

A graduate of the École Normale Supérieure, Dominique Ferrero joined Banque Française du Commerce Extérieur (BFCE) in 1978. He was seconded from BFCE from 1981 to 1986 to various positions in the French Treasury, the Ministry for Foreign Trade and Tourism and the Ministry for Industrial Redeployment and Foreign Trade. From 1988 to 1991, Mr Ferrero was Development Manager at BFCE and a member of the Executive Management Committee, responsible for creating and developing BFCE’s long-term corporate finance and merchant banking activities. He was named Managing Director of Société Financière de la BFCE, then Deputy Managing Director and member of the Management Board in 1991, before being named Managing Director of BFCE in 1994. In 1996, he became Managing Director of the Natexis group (resulting from the merger of BFCE and Crédit National), then Managing Director of Natexis Banques Populaires (resulting from the merger of Natexis and Caisse Centrale des Banques Populaires) in 1999 and Chief Executive Officer of Crédit Lyonnais from 1999 to 2003. From 2004 to 2006, Mr Ferrero was Senior Adviser and Vice-Chairman of Merrill Lynch Europe and, from 2006 to 2008, he was Chief Executive Officer of Natixis. He is now an adviser to the Chairman of Natixis.

Jean-Pierre Lamoure

Other appointments and positions held at 31/12/2012

Director since 2000 Term of office ends: 2014 Shareholders’ General Meeting

Chairman of the Supervisory Board of Atlantic SFDT Member of the Strategy and Investments Committee

Appointments and positions that have expired during the last five financial years Within the VINCI Group

Honorary Chairman of Soletanche Freyssinet.

Chairman and Chief Executive Officer of Soletanche; Chairman of Soletanche Freyssinet, of Soletanche Bachy Entreprise and of Soletanche Bachy; Manager of Compagnie du Sol and of Solval (company merged); Director of Bachy Soletanche Holdings Ltd (United Kingdom).

Age: 64 Nationality: French

Outside the VINCI Group in listed companies

Number of VINCI shares held at 31/12/2012: 2,026

Director of Technip. In unlisted companies or other structures

Director since 2008 Term of office ends: 2016 Shareholders’ General Meeting Address: Soletanche Freyssinet 133 boulevard National 92500 Rueil Malmaison, France

Jean-Bernard Lévy Chairman and Chief Executive Officer, Thales Chairman of the Remuneration Committee

Manager of Comemi; Chairman of the Supervisory Board of Atlantic SFDT; Chairman of the Executive Board of Sedeco; Director of the French National Federation of Public Works (FNTP); Manager of HIGB.

Background Jean-Pierre Lamoure is a graduate of the École Polytechnique and holds the rank of Master Engineer in the Corps des Mines. He held several different posts at the French Ministry of Industry between 1975 and 1981. From 1981 to 1983, he was Head of Management Control and Planning in the insulation division of Saint-Gobain. In 1983 he joined the Soletanche group as Chief Executive Officer, a position he held from 1983 to 1987, before being appointed Chairman of the Executive Board of Soletanche Entreprise for 1987–1989. He was appointed Chairman and Chief Executive Officer of Soletanche SA in 1989 and served in this same position from 1997 to 2008 at Soletanche Bachy, which became a subsidiary of VINCI Construction in 2007. At Forasol-Foramer, a Soletanche subsidiary, he served as Vice-Chairman from 1983 to 1988, then as Chairman and Chief Executive Officer from 1988 to 1994 and as Chairman of the Supervisory Board from 1994 to 1997. Mr Lamoure has also been Chairman of the Supervisory Board of Atlantic SFDT since 1998. In addition, he was Vice-Chairman of the French National Federation of Public Works (FNTP) from 1998 until 2007, and has been its Secretary since 2007. Between 1995 and 1999 and between 2004 and 2009, he was also Chairman of that federation’s Technology and Innovation Commission. Other appointments and positions held at 31/12/2012

Number of VINCI shares held at 31/12/2012: 2,400 Director since 2007 Term of office ends: 2015 Shareholders’ General Meeting

Appointments and positions that have expired during the last five financial years

Outside the VINCI Group in listed companies Director of Société Générale.

Age: 58 Nationality: French

Chairman of Psila; Manager of Clamar; member of the Supervisory Board of Fortis Banque France; Secretary of the French National Federation of Public Works (FNTP).

Chairman of the Management Board of Vivendi; Chairman of the Board of Directors of Activision Blizzard, Inc. (USA); Vice-Chairman of the Supervisory Board of Maroc Télécom (Morocco). In unlisted companies or other structures

Chairman of the Supervisory Board of Viroxis; Chairman of JBL Consulting & Investment SAS; Chairman of the Board of Directors of the Institut Mines-Télécom; Director of the Institut Pasteur; member of the Advisory Board of Paris Europlace.

Chairman and Chief Executive Officer of SFR; Chairman of the Supervisory Board of the Canal Plus Group and of Canal Plus France; Chairman of the Board of Directors of GVT Holding SA (Brazil); Director of Vivendi Games, Inc. and of NBC Universal, Inc. (USA).

Background

Address: Thales 45 rue de Villiers 92526 Neuilly sur Seine, France

Jean-Bernard Lévy is a graduate of the École Polytechnique and Telecom ParisTech. He was an engineer at France Telecom from 1978 to 1986, and then technical adviser to Gérard Longuet, the French Minister with responsibility for Postal Services and Telecommunications from 1986 to 1988; Director of Communication Satellites at Matra Marconi Space from 1988 to 1993 and Chief of Staff to Gérard Longuet, the French Minister for Industry, Postal Services and Telecommunications and Foreign Trade from 1993 to 1994. From 1995 to 1998, Mr Lévy was Chairman and Chief Executive Officer of Matra Communication, then Managing Partner, Corporate Finance at Oddo Pinatton from 1998 to 2002. He joined Vivendi Universal in August 2002 as Chief Operating Officer and was appointed Chairman of the Management Board of Vivendi on 28 April 2005. Mr Lévy was appointed Chairman and Chief Executive Officer of Thales on 20 December 2012.

Michael Pragnell

Other appointments and positions held at 31/12/2012

Chairman of the Council of Trustees of Cancer Research UK Member of the Audit Committee

Member of the Board of Directors of INSEAD.

Age: 66 Nationality: British Number of VINCI shares held at 31/12/2012: 1,000 Director since 2009 Term of office ends: 2013 Shareholders’ General Meeting Renewal of appointment for a period of four years proposed to the Shareholders’ General Meeting on 16 April 2013 Address: Pound Cottage Silchester RG7 2LR, United Kingdom

Appointments and positions that have expired during the last five financial years

In unlisted companies or other structures Chief Executive Officer and Director of Syngenta AG. Background Michael Pragnell is a graduate of St John’s College, Oxford and INSEAD. In 1968, he joined Courtaulds Ltd where he held positions in marketing and sales. In 1974, he joined First National Bank of Chicago in the international department in New York. From 1975 to 1995, Mr Pragnell held various positions within the Courtaulds group: International Paint plc (1975–1985), Chief Executive Officer of National Plastics (1985–1986), Chief Executive Officer of International Paint plc (1986–1992) and Chief Financial Officer (1992–1994) of Courtaulds plc, where he was appointed to the Board of Directors in 1990. From 1995 to 2000, he was Chief Executive Officer of Zeneca Agrochemicals and a member of the Executive Committee of Zeneca plc (now known as AstraZeneca plc), and was appointed to its Board of Directors in 1997. From 1996 to 1999, he was Director of David S Smith plc and of Advanta BV (Netherlands). In 2000, Mr Pragnell was appointed as the founding Chief Executive Officer and Chairman of the Executive Committee of Syngenta AG, where he was also a founding member of the Board of Directors. From 2002 to 2005, he was Chairman of CropLife International.

130

Henri Saint Olive

Report of the Board of Directors

Other appointments and positions held at 31/12/2012

Chairman of the Board of Directors of Banque Saint Olive Chairman of the Audit Committee

Outside the VINCI Group in listed companies Member of the Supervisory Board of Eurazeo.

Age: 69 Nationality: French Number of VINCI shares held at 31/12/2012: 48,843 Director since 2000 Term of office ends: 2014 Shareholders’ General Meeting

Appointments and positions that have expired during the last five financial years

In unlisted companies or other structures Chairman of the Supervisory Board of Saint Olive et Cie and of Saint Olive Gestion; Chairman of the Board of Directors of Enyo; Manager of CF Participations and of Segipa; member of the Supervisory Boards of Prodith and of Monceau Générale Assurances; Director of Centre Hospitalier Saint-Joseph-et-Saint-Luc and of the Association de l’Hôpital Saint-Joseph at Lyon; Chairman of the Saint Gabriel endowment fund.

Chairman of the Board of Directors of Ciarl; Director of Rue Impériale de Lyon, Monceau Assurances Mutuelles Associées and Groupe Monceau-Mutuelles Associées; Managing Partner of LP Participation; member of the Supervisory Board of ANF; Director of Mutuelle Centrale de Réassurance and Compagnie Industrielle d’Assurance Mutuelle.

Background

Address: Banque Saint Olive 84 rue Duguesclin 69458 Lyon Cedex 06, France

A graduate of HEC, in 1969 Henri Saint Olive joined Banque Saint Olive where he has spent his working life. He was appointed Chairman of the Executive Board of this bank in 1987, then Chairman of its Board of Directors in 1997.

Pascale Sourisse

Other appointments and positions held at 31/12/2012

Senior Vice-President, International Development, Thales Member of the Audit Committee

Outside the VINCI Group in listed companies Director and member of the Accounts and Audit Committee of Renault.

Age: 51 Nationality: French Number of VINCI shares held at 31/12/2012: 1,000

Appointments and positions that have expired during the last five financial years

Director of DCNS.

In unlisted companies or other structures Director of Thales UK Limited, of Thales Electronics plc; of Thales Nederland BV and of Thales Australia Pty Ltd; Chairman of Thales Canada Inc; President of the Board of Telecom ParisTech.

Director since 2007 Term of office ends: 2015 Shareholders’ General Meeting Address: Thales 45 rue de Villiers 92526 Neuilly sur Seine, France

Chairman and Chief Executive Officer of Alcatel Cyber Satellite and Thales Communications SA; Chairman of 181 Centelec SAS, Thales Security & Solutions SAS and Eurospace; Director and Chairman of Skybridge Satellite Operations; Director of Skybridge LLC, Skybridge 2 LLC, Skybridge Operations France, Skybridge Satellite Communications and Satlynx; Chairman of Thales Alenia Space France SAS, Alcatel Spacecom and SkyBridge GP, Inc.; Director of Thales North America, Inc. (USA), Thales Alenia Space Italia SpA, Telespazio Holding SRL, Galileo Industries SA, Galileo Industries SpA and EuropeStar Ltd; member of the Board of Administrators of Gifas; Chairman and Chief Executive Officer of Thales Communications & Security SA; Chairman of Thales Services SAS; member of the Supervisory Board of Thales Alenia Space SAS; Director of Thales USA, Inc.; member of the Board of Directors of Institut Télécom (French Ministry of Economy, Finance and Industry).

Background A graduate of the École Polytechnique, Pascale Sourisse is a telecommunications engineer. She worked as an engineer at Compagnie Générale des Eaux from 1984 to 1985, as an engineer in the telecommunications division of Jeumont-Schneider from 1985 to 1986, and as head of the enterprise network division at France Telecom from 1987 to 1990. From 1990 to 1994, Ms Sourisse worked in the French Ministry for Industry as assistant deputy manager, then deputy manager, of the Consumer Electronics and Audiovisual Communication department. She then joined the Alcatel Group, where she held the positions of Director, Planning and Strategy from 1995 to 1997, Chairman and Chief Executive Officer of Skybridge from 1997 to 2001, Chief Operating Officer and then President and Chief Executive Officer of Alcatel Space from 2001 to 2005. She was President of Alcatel Alenia Space (now Thales Alenia Space) from 2005 to 2008. Since April 2007, she has been a member of the Executive Committee of Thales. From May 2008 until early 2010, Ms Sourisse was Senior Vice President of Thales’ Land & Joint Systems Division. In early 2010, she was named Managing Director, then Senior Vice President for Defence & Security C4I Systems at Thales. Currently, she is Senior Vice-President, International Development, Thales. Qatari Diar Real Estate Investment Company

Other appointments and positions held at 31/12/2012

Outside the VINCI Group in listed companies

Nationality: Qatari Permanent representative: Abdul Hamid Janahi Member of the Strategy and Investments Committee Number of VINCI shares held by the Qatari Diar group at 31/12/2012: 31,500,000 (1,000 held directly; 31,499,000 through its subsidiary Comet Luxembourg) Director since 2010 Term of office ends: 2015 Shareholders’ General Meeting Address: Qatari Diar Real Estate Investment Company Lusail Visitor Center Lusail Street PO Box 23175 Doha, Qatar

Appointments and positions that have expired during the last five financial years

Director of Veolia Environnement. In unlisted companies or other structures Director of Société Fermière du Casino Municipal de Cannes SA. Background Qatari Diar Real Estate Investment Company (Qatari Diar) was formed in 2005 and is wholly owned by the Qatar Investment Authority (QIA), which belongs to the State of Qatar. Qatari Diar is the main player in Qatar’s urban development projects and in property development operations carried out abroad on behalf of the State of Qatar. Qatari Diar is present in more than 20 countries across Asia, Africa, Europe and South America. In 2008, Qatari Diar acquired control of Cegelec. In 2010, Qatari Diar transferred ownership of Cegelec to VINCI in exchange for new VINCI shares and treasury shares. Since this transaction, Qatari Diar has owned 31,500,000 VINCI shares. The Chairman of the Board of Directors of Qatari Diar is His Excellency Yousef Hussein Kamal, Minister of Economy and Finance of Qatar. Mr Ghanim bin Saad al-Saad, a Director of Qatari Diar, is also Chairman of Barwa, a listed subsidiary in which Qatari Diar has a substantial shareholding and which is one of the country’s main property developers. Qatari Diar’s Chief Executive Officer is Mr Mohammed bin Ali Al Hedfa. Mr Abdul Hamid Janahi holds a bachelor’s degree in electrical and electronics engineering from Louisiana State University. He began his career in 1988 at Qatar Petroleum as an engineer involved in both offshore and onshore projects. In 2005, he became Director of Project Management for state-owned company Kahramaa. Mr Janahi was appointed as Director of Joint Ventures at Qatari Diar in 2008.

VINCI 2012 Annual Report

131

Report of the Board of Directors

1.2 Individuals whose appointments as Directors are proposed to the Shareholders’ General Meeting of 16 April 2013 Yannick Assouad Chief Executive Officer, Aircraft Systems, Zodiac Aerospace Age: 53

Other appointments and positions held at 31/12/2012

In unlisted companies or other structures Chairman and Director of various companies within the Aircraft Systems business segment of Zodiac Aerospace.

Nationality: French Number of VINCI shares held at 31/12/2012: 97 First appointment: proposed to the Shareholders’ General Meeting on 16 April 2013

Appointments and positions that have expired during the last five financial years

Background Yannick Assouad is a graduate of the Institut National des Sciences Appliquées and the Illinois Institute of Technology. While working as an instructor at CIEFOP Paris, she joined Thomson CSF in 1986, where she was head of the thermal and mechanical analysis group until 1998. From 1998 to 2003, Ms Assouad served first as Technical Director and then as Chief Executive Officer of Honeywell Aerospace, before being appointed Chairman of Honeywell SECAN. In 2003, she joined Zodiac Aerospace, initially as Chief Executive Officer of Intertechnique Services, a post she held until 2008. Ms Assouad was then selected to create Zodiac Aerospace’s Services business segment, which she headed until 2010, when she was appointed Chief Executive Officer of the group’s Aircraft Systems segment.

Term of office ends: 2017 Shareholders’ General Meeting Address: Zodiac Aerospace 61 rue Pierre Curie CS 20001 78373 Plaisir Cedex, France Graziella Gavezotti Chief Operating Officer, Southern Europe, Edenred Age: 61 Nationality: Italian Number of VINCI shares held at 31/12/2012: 0 First appointment: proposed to the Shareholders’ General Meeting on 16 April 2013

Other appointments and positions held at 31/12/2012

Appointments and positions that have expired during the last five financial years

In unlisted companies or other structures Chairman of the Board of Directors of Edenred Italia SRL, of E-Lunch SRL, of Ristochef SRL, and of Voucher Services SA (Greece); Director of Edenred Kurumsal Cozumler SA (Turkey) and of Edenred España SA. Background Graziella Gavezotti is a graduate of the Università di Comunicazione e Lingue (IULM) and has a degree in psychology from the University Rijeka (class of 1991). She worked for Jacques Borel Group, Gemeaz and Accor, before joining Edenred where she developed the Ticket Restaurant business in Italy. Since June 2012, she has been head of Edenred’s Southern Europe area, which includes Italy, Spain, Portugal, Turkey and Greece.

Term of office ends: 2017 Shareholders’ General Meeting Address: Edenred Via G.B. Pirelli 19 20124 Milan, Italy

1.3

Director whose term of office expired in 2012

Dominique Bazy

Other appointments and positions held at 31/12/2012

Managing Partner of Barber Hauler Capital Advisers

Within the VINCI Group Director of VINCI.

Age: 61

In unlisted companies or other structures

Nationality: French Number of VINCI shares held at 12/04/2012: 1,400

Appointments and positions that have expired during the last five financial years

Director of Pierre Fabre SA.

Director since 1996 Term of office ended: 2012 Shareholders’ General Meeting

Vice-Chairman Europe of UBS Investment Bank; Chairman and Chief Executive Officer of UBS Holding France SA; Chairman of the Board of Directors of UBS Securities France SA; Director of GrandVision et and of Pierre Fabre Participations; member of the Supervisory Board of Atos Origin; Director of Atos Origin. Background

Dominique Bazy has a degree in law, and is a graduate of the Institut d’Études Politiques de Paris and the École Nationale d’Administration. He is also a qualified economist. After holding various positions in government departments, he joined Athena in 1984, became Chief Executive of Athena Banque in 1985 and Deputy Chief Executive of Athena from 1986 to 1988. He was appointed Chairman of Sicav Haussmann France in 1987. From 1990 to 1992, Mr Bazy held various positions with UAP. He was a member of the Executive Committee of Credit Lyonnais in 1993 and Chairman of Clinvest from 1993 to 1994, Chairman of the Supervisory Board of Altus Finance in 1993, Executive Vice-President of Compagnie de l’UAP from 1995 to 1996, Chairman of Allianz Assurances France from 1997 to 2000, General Manager in charge of AGF’s general agents department from 1998 to 2000, member of the International Executive Committee of Allianz AG from 1997 to 2000, Chairman and Chief Executive Officer of UBS Warburg (now UBS) Holding France from 2000 to 2003 and Chairman of UBS Securities France SA from 2003 to 2004. From 2004 to 2009, he was Vice-Chairman Europe of UBS Investment Bank. Since 1 September 2009, Mr Bazy has been Managing Partner of Barber Hauler Capital Advisers.

2. 2.1

VINCI shares held by company officers Shares held by company officers

In accordance with the Company’s Articles of Association, each Director (other than the Director representing employee shareholders) must hold a minimum of 1,000 VINCI shares which, on the basis of the share price at 31 December 2012 (€35.96), amounts to a minimum of €35,960 invested in VINCI shares. The number of shares held by each of the company officers at 31 December 2012, as declared to the Company, is included in the information presented in the section “Company officers’ appointments and other positions held” on pages 127 to 131.

132

Report of the Board of Directors

2.2 Share transactions by company officers, executives and persons referred to in Article L.621-18-2 of the French Monetary and Financial Code The Group’s company officers and executives subject to spontaneous declaration of their share transactions carried out the following transactions in 2012: Acquisitions (*)

(in number of shares)

Disposals (**)

Xavier Huillard, Chairman and Chief Executive Officer

137,544 

148,164 

Christian Labeyrie, Executive Vice-President and Chief Financial Officer

125,181 

123,806 

0

0

Richard Francioli, Executive Vice-President, Contracting (*) Excluding grants of performance shares. (**) Excluding donations and disposals of units in company savings funds invested in VINCI shares.

3.

Company officers’ remuneration and interests

3.1

Directors’ fees and other remuneration received by non-executive company officers

The total amount of Directors’ fees paid in 2012 by the Company (for the second half of 2011 and the first half of 2012) amounted to €814,166. Some company officers also received Directors’ fees in 2012 from companies controlled by VINCI. The total amount of Directors’ fees payable by VINCI in respect of 2012 was €784,167. The table below summarises the Directors’ fees and other remuneration received in 2011 and 2012 by non-executive company officers of VINCI.

Directors’ fees and other remuneration received by non-executive company officers Amount paid in 2011

Amount paid in 2012

By VINCI

By companies controlled by VINCI

By VINCI

By companies controlled by VINCI

403,648 



190,000 





-





8,333 



50,000 

– –

Serving Directors Yves-Thibault de Silguy (1) Abdul Hamid Janahi (2) Élisabeth Boyer (3) (4) Robert Castaigne

55,000 



57,083 

François David

50,000 



50,000 



Patrick Faure

50,000 

10,000 

50,000 

7,500 

Dominique Ferrero

50,000 



50,000 



Jean-Pierre Lamoure (5)

50,000 

216,060 

50,000 

216,060 

Jean-Bernard Lévy

60,000 



60,000 



Michael Pragnell

55,000 



55,000 



Henri Saint Olive

65,000 



65,000 



Pascale Sourisse

55,000 



55,000 



Yousuf Ahmad Al Hammadi (2)

16,667 



42,500 



Dominique Bazy (6)

50,000 



39,583 



Alain Maillot (7)

33,333 







Denis Vernoux (8)

41,667 







1,043,648 

226,060 

814,166 

223,560 

Former Directors

Total Directors’ fees and other remuneration

(1) Yves-Thibault de Silguy’s remuneration package from the time of his appointment as Vice-Chairman and Senior Director on 6 May 2010 is described in the Report of the Chairman on page 186. It should be noted that his remuneration in 2011 included the remainder of the variable component received by him in his capacity as Chairman of the Board of Directors for the period 1 January to 6 May 2010 as well as the Directors’ fees paid to him in 2011 (€190,000). Mr de Silguy also received benefits in kind of €5,020 in 2011 and 2012 (company car). It is also worth noting that (a) Mr de Silguy is entitled to receive a non-externalised pension benefit, payable in the amount of €381,168 for 2011 and in the amount of €388,140 for 2012 and that (b) the Company entered into a services agreement on 3 March 2010 with YTSeuropaconsultants, of which Mr de Silguy is sole partner, authorised by the Board of Directors and approved by the Shareholders’ General Meeting of 6 May 2010. This agreement covers the responsibilities described in the Report of the Chairman on page 186. Under this agreement, YTSeuropaconsultants received from VINCI a total payment of €330,000 excluding VAT for each of the financial years 2011 and 2012. The amounts mentioned in points (a) and (b) are not included in the table above. (2) Replacing Yousuf Ahmad Al Hammadi, Abdul Hamid Janahi has served since 29 November 2012 as the permanent representative of Qatari Diar Real Estate Investment Company, a Director of VINCI. (3) The total amount paid in 2011 covers the period from 2 May 2011 (when Élisabeth Boyer was appointed as the Director representing employee shareholders) to 30 June 2011. (4) The salary received by Ms Boyer, who is currently the Director representing employee shareholders, is not included in the table above. (5) In 2011 and 2012, Jean-Pierre Lamoure received remuneration of €216,060 in respect of his appointment as Chairman of the Board of Directors of Soletanche Freyssinet. He also received benefits in kind of €2,328 in 2011 and €2,129 in 2012 (company car). (6) The total amount paid in 2012 covers the period from 1 July 2011 until the expiry of Dominique Bazy’s term of office on 12 April 2012. (7) The total amount paid in 2011 covers the period from 1 July 2010 until the change in the permanent representative of Qatari Diar Real Estate Investment Company effective 1 March 2011. (8) The total amount paid in 2011 covers the period from 1 July 2010 until Denis Vernoux’s resignation on 2 May 2011.

VINCI 2012 Annual Report

3.2

133

Report of the Board of Directors

Remuneration received by the Chairman and Chief Executive Officer

3.2.1 Remuneration

Pursuant to the provisions of the Afep-Medef code of corporate governance relating to the remuneration of executive company officers, the tables below summarise (a) all remuneration allocated and options and performance shares granted to the executive company officer during the last two financial years and (b) the remuneration paid during the last two financial years by VINCI and Group companies to Xavier Huillard, Chairman and Chief Executive Officer, as well as the remuneration set by the Board of Directors, as proposed by the Remuneration Committee, that is due in respect of each of these two financial years, regardless of the year in which the remuneration in question is paid. (a) Summary of remuneration due in respect of the last two years and options and shares granted Xavier Huillard

2011

2012

Remuneration due in respect of the year (in €)

1,834,072 

1,905,264

Value of options granted during the year (in €)





Value of performance shares granted during the year (in €)





1,834,072 

1,905,264

Total

(b) Summary of remuneration (in €) 2011

2012

Amount due in respect of the year

Amount paid during the year

Amount due in respect of the year

Amount paid during the year

Gross fixed remuneration

900,000 

900,000 

900,000 

900,000 

Gross variable remuneration including Directors’ fees (*)

930,000 

Gross variable remuneration excluding Directors’ fees (*)

916,330 

882,997 

987,530

916,330 

Directors’ fees (net amount) (*)

13,670 

13,670 

13,670 

13,670 

4,072 

4,072 

4,064 

4,064 

1,834,072 

1,800,739 

1,905,264

1,834,064 

Xavier Huillard

Benefits in kind (**) Total

1,001,200

(*) Directors’ fees received by Xavier Huillard from companies belonging to the VINCI Group are deducted from the variable remuneration decided by the Board, as proposed by the Remuneration Committee. Since his appointment as Chairman and Chief Executive Officer, thus with effect from 6 May 2010, Mr Huillard has not received Directors’ fees from VINCI SA. For the duration of this appointment, the only Directors’ fees he receives are those paid in respect of appointments in other Group companies. (**) Mr Huillard had the use of a company car in 2011 and 2012.

Xavier Huillard’s remuneration package is described on page 186. At its meeting of 5 February 2013, the Board of Directors decided, in respect of 2012 and as proposed by the Remuneration Committee, to set the portion of the variable component of Mr Huillard’s remuneration based on financial criteria, after calculating the performance index, at €581,200 and the managerial portion at €420,000, making a total variable component of €1,001,200 before deducting Directors’ fees amounting to €13,670 paid in 2012.

3.2.2

3.2.3

3.2.4

Long-term incentive plan

At its meeting of 3 March 2010, the Board decided to set up a long-term incentive plan to be awarded to Xavier Huillard, the features of which are described in section 4.1 of the Report of the Chairman on page 186. This plan gives rise to an annual allocation that Mr Huillard will only be eligible to receive if he completes his term in office (except in specific cases). Each year, the Company sets aside a provision corresponding to the value, at market conditions prevailing on 31 December, of the likely amount. At 31 December 2012, the total provision recognised in respect of this plan from its inception at 6 May 2010 amounted to €1,714,701.

Obligations in respect of supplementary retirement plans

Like other senior executives of VINCI SA with at least 10 years’ service, Xavier Huillard is eligible for coverage under a collective pension plan, the purpose of which, subject to certain conditions being met and, more particularly, that he is still employed by the company, is to guarantee the individuals concerned a supplementary annual pension upon their retirement of between 20% and 40% of the average annual remuneration received in the 36 months preceding their departure. This supplementary pension plan will be limited to an annual amount that will gradually increase to a maximum of eight times the French social security ceiling at 1 January 2019. As the application of this plan constitutes a commitment subject to the procedure for the authorisation of regulated agreements in accordance with Article L.225-42-1 of the French Commercial Code, it required the approval of the Shareholders’ General Meeting, which was given on 6 May 2010. At 31 December 2012, VINCI’s obligations in respect of the retirement benefits described above for Mr Huillard amounted to €4,970,500. Retirement benefit obligations are also described on page 238 of the Notes to the consolidated financial statements.

Summary table

The table below summarises the various data relating to the existence in favour of the executive company officer, if applicable, of (I) an employment contract in addition to the appointment as company officer, (II) supplementary pension plans, (III) commitments entered into by the Company corresponding to allowances or benefits due or that could be due in connection with or as a result of either the cessation of the executive company officer’s duties or a change in these duties, and (IV) allowances compensating for a non-competition clause.

134

Report of the Board of Directors

Executive company officer

Allowances or benefits that could be due as a result Supplementary of the cessation of duties or pension plan a change in duties

Employment contract no (**)

Xavier Huillard, Chairman and Chief Executive Officer (*)

yes

Allowances for noncompetition clause

yes (***)

no

(*) Xavier Huillard’s term of office started on 6 May 2010 and will expire at the close of the 2014 Shareholders’ General Meeting. (**) Mr Huillard had a suspended employment contract that ended via resignation on 6 May 2010 when he was appointed as Chairman and Chief Executive Officer of VINCI. (***) Mr Huillard is eligible for severance pay in the event that the Company terminates his appointment as Director prior to the expiry of his term of office, described on page 186 of the 2012 Annual Report.

4. 4.1

Options and performance shares Policy on granting of options or performance shares

Two authorisations given to VINCI’s Board of Directors remained valid in 2012: one conferred by the Shareholders’ General Meeting of 2 May 2011 to grant share subscription options and another conferred by the Shareholders’ General Meeting of 12 April 2012 to grant performance shares. In 2012, an incentive plan was set up, resulting either in the granting of performance shares alone, or the combined granting of share subscription options and performance shares, depending on the beneficiary’s management level. VINCI’s policy consists of granting performance shares and options to a significant number of Group executives and employees (a total of about 1,900) in order to allow them to share in its performance and ensure their long-term commitment.

4.2

Share subscription or share purchase option plans

4.2.1

Existing option plans General information Under the authorisations given by the Shareholders’ General Meeting, the Board of Directors of VINCI decided to set up share subscription and/or share purchase option plans, details of which are given in the following table.  

Record of granting of share subscription or purchase options (1) Plan

Date

Original number

Shareholders’ General Board BenefiMeeting meeting ciaries

Options (2)

Including options originally granted to

Date

In 2012

Exercise price

At 31/12/2012

From Number of Options Number of Top 10 which Number of options not remaining employee options options cancelled or exercised beneficiaries Company beneficiarmay be Of expiry exercised expired in at at officers (2)(3) ies (2)(4) exercised of options in 2012 2012 31/12/2012 31/12/2012

Adjusted exercise price (in €)

VINCI 2002 No. 1

25/10/99 17/12/02

287

9,802,000

2,620,000

1,212,000 25/01/04 17/12/12

633,138

23,260





15.59

VINCI 2002 No. 2

25/10/99 17/12/02

409

10,000,000

2,760,000

1,020,000

17/12/04 17/12/12

563,329

67,416





12.96 15.04

VINCI 2003

14/05/03 11/09/03

126

5,608,000

1,400,000

1,296,000 11/09/05 11/09/13

144,867



437,319

30

VINCI 2004

14/05/03 07/09/04

142

6,344,000

1,640,000

1,420,000

07/09/06 07/09/14

501,173



1,427,672

62

20.18

VINCI 2005

14/05/03 01/03/05

158

5,081,136

2,268,000

1,176,000

16/03/07 16/03/12

931,109

34,714





24.20

VINCI 2006 No. 1

14/05/03 09/01/06

8

2,630,000

1,850,000

780,000 09/01/08 09/01/13

237,850



834,100

6

35.58

VINCI 2006 No. 2

14/05/03 16/05/06

1,352

3,383,606

50,000

242,000 16/05/08 16/05/12

1,000

3,256,105





40.32

VINCI 2009

14/05/09 31/08/09

1,582

3,865,000



228,180 15/09/12 15/09/16

750

46,615

3,719,591

1,510

38.37

VINCI 2010

14/05/09 09/07/10

1,735

4,234,595



243,348

09/07/17



85,279

4,074,560

1,661

36.70

VINCI 2011 (5)

02/05/11 02/05/11

266

1,592,493



243,346 02/05/14 02/05/18



12,000

1,567,043

260

43.70

VINCI 2012 (5)

02/05/11 12/04/12

302

2,457,980



336,015 12/04/15 12/04/19



18,165

2,439,815

299

39.04

3,543,554 14,500,100

2,106

35,93

Total share subscription plans VINCI 2006 No. 2

14/05/03

Total share purchase plans Total

54,998,810 12,588,000 16/05/06

1,352

09/07/13

8,196,889

3,013,216

3,383,606

50,000

242,000 16/05/08 16/05/12

1,000

3,213,385





40.32

3,383,606

50,000

242,000

1,000

3,213,385





40.32

58,382,416 12,638,000

8,438,889

3,014,216

6,756,939 14,500,100

2,106

35.93

(1) Only those plans for which the exercise period has not expired or expired in 2012 are mentioned. (2) Original number adjusted for the May 2005 and May 2007 two-for-one share splits but not adjusted for the increase in share capital in April 2006 (except for the 2006 No. 2 plan). (3) Company officers serving at the time of granting. (4) Not company officers. (5) The definitive number of options granted will be set on the basis of performance criteria. Note: one option gives the right to subscribe to or purchase one VINCI share; option plans set up prior to 2009 are subject to annual vesting by thirds over a three-year period as from the grant date for the options.

VINCI 2012 Annual Report

135

Report of the Board of Directors

Total number of shares that can be subscribed to or purchased by the executive company officer at 31 December 2012 Executive company officer Xavier Huillard

Plan

Exercise price (in €)

Expiry

Type

VINCI 2004

20.18 

07/09/2014

Subscription

57,052 

VINCI 2006 No. 1

35.58 

09/01/2013

Subscription

205,434 

Total

4.2.2

Number of shares

262,486 

Options granted in 2012 a) General information At its meeting of 12 April 2012, the Board of Directors decided to use the authorisation given by the Shareholders’ General Meeting of 2 May 2011 to set up a plan for the granting of options to subscribe to the Company’s shares, with effect from 12 April 2012. This plan provides for the granting of 2,457,980 options to subscribe to the Company’s shares to 302 Group executives and employees. No options have been granted to the executive company officer under this plan. Each option gives the right to subscribe to one new VINCI share, at a subscription price of €39.04. The definitive granting of options is subject to the performance criteria determined by the Board of Directors under the conditions defined by the Shareholders’ General Meeting, which require that, in the financial years 2012 and 2013, the VINCI Group’s average return on capital employed (ROCE) be higher than 6%, after restating for any non-controlling interests greater than 33.33%. The actual number of options granted will be equivalent to 100% of the options originally granted if the ROCE is equal to 7% and the proportion will be set by linear interpolation if this rate is between 6% and 7%. Options that have been definitively granted in line with the performance criteria may only be exercised by the beneficiaries on or after 12 April 2015 provided they are still actively employed by the Group. Shares acquired through the exercise of options may not be transferred or sold before expiry of a four-year holding period in accordance with tax rules, other than in the event of death, permanent disability or involuntary retirement. Beneficiaries also have a right to early exercise of options definitively granted after verification of the performance criteria in the event of a public offer being made for the Company’s shares. The validity period for the options is seven years with effect from 12 April 2012 and thus expires on 12 April 2019. No subsidiary controlled by VINCI has granted share subscription or purchase options. b) Granting of options to the executive company officer No options were granted in 2012 to Mr Xavier Huillard, Chairman and Chief Executive Officer. c) Granting of options to the 10 Group employees (not company officers of VINCI SA) to whom the largest number of options were granted The number of options granted during the year by VINCI and by other Group companies entitled to grant options to the 10 Group employees (not company officers of VINCI SA) who were granted the largest number of options was 336,015, corresponding to 13.67% of the total number.

4.2.3

Options exercised in 2012 a) General information Between 1 January and 31 December 2012, 3,014,216 options were exercised, comprising 3,013,216 subscription options and 1,000 purchase options. During this same period, 6,756,939 options were cancelled or expired, of which 3,453,554 were subscription options and 3,213,385 were purchase options. Taking all these elements into account, a total of 14,500,100 options remained to be exercised at 31 December 2012, at an average exercise price of €35.93, all of which were subscription options. b) Exercise of options by the executive company officer In 2012, Mr Xavier Huillard, Chairman and Chief Executive Officer, exercised the following options:

Share subscription and purchase options exercised during the year

Executive company officer Xavier Huillard

Total

Plan

Date of corresponding meeting of the Board of Directors

Type

Number of options exercised during the year

Exercise price (in €) 15.04 

2003 Plan

11/09/2003

Subscription

580 

2004 Plan

07/09/2004

Subscription

76,964 

20.18 

2006 No. 1 Plan

09/01/2006

Subscription

60,000 

35.58 

137,544 

26.88 

136

Report of the Board of Directors

c) Exercise of options by the 10 Group employees (not company officers of VINCI SA) having exercised the largest number of options In 2012, share subscription and purchase options exercised by the 10 Group employees (not company officers of VINCI SA) having subscribed to or purchased the largest number of shares in 2012 concerned the following plans: Type

Number of options exercised during the year

VINCI 2002 No. 1

Subscription

121,856 

15.59 

VINCI 2002 No. 2

Subscription

102,670 

12.96 

VINCI 2003

Subscription

6,000 

15.04 

VINCI 2004

Subscription

36,881 

20.18 

VINCI 2005

Subscription

158,464 

24.20 

VINCI 2006

Subscription

Plan

Total/weighted average

4.2.4

Exercise price (in €)

50,000 

35.58 

475,871 

20.34 

Definitive granting of options at 9 July 2012 under the plan set up by the Board of Directors on 9 July 2010

Under the plan set up on 9 July 2010, the definitive granting of options is subject to the performance criteria determined by the Shareholders’ General Meeting, namely that the Board of Directors will note, at the end of a period of two years starting on 9 July 2010, any changes in the VINCI share price and will determine the proportion of options to be definitively granted having regard to the share’s performance compared with that of an index initially comprising 13 European companies from the construction and infrastructure concessions sector. The Board reserves the right to make any weightings reflecting in particular the market capitalisation of companies and to exclude from the list certain companies that, during the reference period, may have been the subject of exceptional transactions or de-listing or that may have experienced atypical share price changes and to replace them if applicable with an index such as the Euro Stoxx index. The number of options finally granted will depend on the percentage change in the performance of the VINCI share against the index; 100% of the options will be granted if this rate is higher than 5% and 0% if it is lower than -5%. If the rate is between these two limits of +5% and -5%, the proportion will be determined by linear interpolation. At its meeting of 19 June 2012, the Board of Directors gave full powers to the Chairman and Chief Executive Officer to take note of any change in the performance index and thereby determine the proportion of options to be granted in accordance with the provisions of the plan. On 9 July 2012, the Chairman and Chief Executive Officer noted that the VINCI share had outperformed the index by 9.9% and therefore decided that all of the share subscription options that had been originally granted to the beneficiaries would be deemed to be definitively granted to them at this same date (4,074,560 options granted to 1,661 beneficiaries). It is to be understood that these options will only be definitively granted to their beneficiaries and may only be exercised by them from 9 July 2013 at the determined exercise price of €36.70 provided the beneficiaries meet the conditions to be considered as active employees laid down by the Board in its meeting of 9 July 2010.

4.3

Performance share plans

4.3.1

Existing performance share plans a) General information

Record of granting of performance shares Plan

Date

Original number

Shareholders’ General Meeting

Board meeting

Beneficiaries

VINCI 2010 (3) 15/05/2008

Performance shares

Including shares originally granted to

Definitive number

Top 10 Determined employee at the end of Company beneficiaries the vesting (2) period officers (1)

Date Start of vesting period

End of vesting period

At 31/12/2012 End of holding period

Number of remaining Number of beneficiaries shares at at 31/12/2012 31/12/2012

09/07/2010

1,813 

1,726,138 



97,339 

1,607,900 

09/07/2010

09/07/2012

09/07/2014

1,607,900 

VINCI 2011 (4) 15/05/2008 02/05/2011

1,782 

2,139,059 



97,338 

unknown

02/05/2011

02/05/2013

02/05/2015

2,061,310 

1,709 

VINCI 2012 (4) 12/04/2012 12/04/2012

1,881 

2,202,580 



96,004 

unknown

12/04/2012

12/04/2014

12/04/2016

2,188,390 

1,864 

Total

2,616 

6,067,777 

5,857,600 

2,475 

290,681 

1,685 

(1) Company officers serving at the time of granting. (2) Not company officers. (3) These shares were definitively granted to the beneficiaries on 9 July 2012, following the decision by the Board of Directors on 19 June 2012, which noted that the performance criteria provided for in the plan set up in July 2010 had been met. (4) The number of shares definitively granted at the end of the vesting period may be lower, depending on the results of a performance indicator.

VINCI 2012 Annual Report

Report of the Board of Directors

137

b) Number of performance shares granted to the executive company officer Mr Xavier Huillard, Chairman and Chief Executive Officer, was not granted any performance shares under the plans described above. At its meeting of 27 February 2007, the Board of Directors of VINCI decided that executive company officers would be required to retain at least one-quarter of any performance shares received for the duration of their appointment. In accordance with this rule, Xavier Huillard, who has been definitively granted 40,874 performance shares under the plans set up in 2007 and 2008, is required to retain 10,219 shares until the expiry of his term of office.

4.3.2

Establishment of the 2012 plan

At its meeting of 12 April 2012, the Board of Directors decided to use the authorisation given by the Shareholders’ General Meeting of 12 April 2012 to set up a plan for the granting of Company performance shares, with effect from 12 April 2012. This plan provides for the granting of 2,202,580 existing shares to 1,881 beneficiaries. No performance shares have been granted to the executive company officer under this plan. The plan stipulates that the shares are only deemed to be definitively granted at the end of a two-year vesting period, which will expire on 12 April 2014. The definitive granting of shares is subject to the following performance criteria: ˇˇ for beneficiaries who were members of the Executive Committee at 12 April 2012, performance shares are only deemed to be definitively granted if, in respect to both 2012 and 2013, the VINCI Group’s average return on capital employed (ROCE) is higher than 8%, after restating for any non-controlling interests greater than 33.33%. The number of performance shares finally granted will depend on this rate; 100% of the shares will be granted if the ROCE is higher than 9% and the proportion will be set by linear interpolation if the rate is between 8% and 9%; ˇˇ for beneficiaries who were not members of the Executive Committee at 12 April 2012, performance shares are only deemed to be definitively granted if, in respect to both 2012 and 2013, the VINCI Group’s average return on capital employed (ROCE) is higher than 6%, after restating for any non-controlling interests greater than 33.33%. The number of performance shares finally granted will depend on this rate; 100% of the shares will be granted if the ROCE is higher than 7% and the proportion will be set by linear interpolation if the rate is between 6% and 7%; ˇˇ the Board of Directors decided not to take the impact of the acquisition of airport company ANA into account in the calculation of the ROCE. The plan also provides that the shares granted in this way must be retained for two years, i.e. until 12 April 2016, during which time they may not be transferred or sold, other than in the event of permanent disability or death. The number of shares originally granted by the Board of Directors on 12 April 2012 to the 10 employees who were not company officers and had been granted the largest number of shares was 96,004; the number of shares granted to the members of the Executive Committee was 110,004, thus about 4.99% of the total number granted.

4.3.3 Definitive granting of performance shares on 9 July 2012 under the plan set up by the Board of Directors on 9 July 2010

The plan set up on 9 July 2010, with effect from the same date, stipulates that shares are only definitively granted if performance criteria are met and at the end of a two-year vesting period expiring on 9 July 2012. Shares are only definitively granted if, in respect of both 2010 and 2011, the VINCI Group’s average return on capital employed (ROCE) is higher than 5%, after restating for any non-controlling interests greater than 33.33%. The number of performance shares finally granted will depend on this rate; 100% of the shares will be granted if the ROCE is higher than 6% and the proportion will be set by linear interpolation if the rate is between 5% and 6%. On 19 June 2012, the Board of Directors noted that the VINCI Group’s average return on capital employed (ROCE) amounted to 9.2% on average for the 2010 and 2011 financial years (after restating for non-controlling interests). Consequently, at its meeting of 19 June 2012, the Board decided to definitively grant, as at 9 July 2012, to the 1,685 beneficiaries 100% of the performance shares that were originally granted to them, representing 1,607,900 shares. Beneficiaries may not transfer or sell these shares for an additional two-year holding period that will expire on 9 July 2014.

138

Report of the Board of Directors

E. Social and environmental information This report is compiled pursuant to Articles L. 225-102-1, R. 225-104 and R. 225-105 of the French Commercial Code, and is based on such international reporting guidelines and standards as the Global Reporting Initiative and ISO 26000. The aim of this report is to comply with the application of the draft decree relating to corporate transparency obligations on social and environmental matters. It contains three sections: ˇˇ workforce-related responsibility (pages 139 to 150); ˇˇ environment (pages 150 to 159); ˇˇ social responsibility (pages 159 to 168). VINCI’s sustainable development policy and strategy are presented on pages 18 to 29 of this annual report. Additional, regularly updated information is available on the Group’s website at www.vinci.com, in particular examples of the innovative approaches implemented by the Group’s companies, arranged by category and type of challenge. Since 2002, VINCI has requested the opinion of its Statutory Auditors on its social and environmental reporting procedures, which form part of a single reporting system, and on a selection of performance indicators. Information about this audit work, along with a note about the methods used, is presented on pages 166-168 and 177-178. In addition to complying strictly with legislation, VINCI has voluntarily committed to observing the 10 principles of the UN’s Global Compact and to reporting annually on its initiatives in this area. VINCI has also made a commitment to French non-profit organisation Amis du Global Compact France to promote these initiatives among businesses. “Advance”, a method developed by VINCI in the form of a sustainable development selfdiagnosis questionnaire, enables managers to review the Group’s workforce-related, environmental and social categories, and take strategic decisions related to them. The method was developed in accordance with the principles of the Global Compact, the fundamental conventions of the ILO (International Labour Organisation) and ISO 26000.

Global Compact implementation Commitments/principles

Initiatives in 2012

Human rights 1. To support and respect the protection of internationally proclaimed human rights within the Group’s sphere of influence.

- Sogea-Satom’s support for various non-profit projects relating to business, health and education in 20 countries. - Ongoing support for HIV-AIDS prevention programmes. - Drafting of a “Labour standards and human rights” chapter for the “Global performance commitments of VINCI suppliers and subcontractors” charter, which is sent to Group suppliers and incorporated into VINCI contracts.

2. To ensure that Group companies are not complicit in human rights abuses.

- Development of a supplementary online tool to help deploy VINCI’s “Advance” self-diagnosis method, enabling subsidiaries to map their CSR risks, particularly as regards basic human rights.

Labour standards 3. To uphold the freedom of association and the effective recognition of the right to collective bargaining.

- Signature of a new agreement with labour representatives in December 2011 to improve dialogue between management and labour in 2012. Drafting of a code of best practice in subcontracting planned for dissemination in early 2013.

4. To uphold the elimination of all forms of forced and compulsory labour.

- Inclusion of workforce-related criteria in the supplier and subcontractor selection process, as well as in framework contracts with VINCI subsidiaries. - Monitoring of improvement plans for temporary employment agencies.

5. To uphold the effective abolition of child labour.

- Addition of clauses prohibiting child labour to framework contracts.

6. To uphold the elimination of discrimination in respect of employment and occupation.

- Launch of ViE, an in-house social integration consultancy, to assist VINCI companies in hiring people under social integration through work programmes. - Several major programmes put in place: “Capital Filles”, Group Ambassadors, stereotypes laboratory. - Audit and monitoring work for the sixth consecutive year, particularly outside France. - Further diversity training for operational staff. “Diversity day” organised.

Environmental protection 7. To support a precautionary approach to environmental challenges.

- Environmental criteria and pollution prevention systematically taken into consideration when assessing business and product risk at an early stage of projects (REACH). - Increased training in environmental risk prevention. - First-time participation in the CDP Water Disclosure project: only 191 companies have responded to this initiative. - Systematic application of life-cycle analysis during proposal and design phases: multi-criteria analysis of each phase of the project life cycle.

8. To undertake initiatives to promote greater environmental responsibility.

- Development of a national biodiversity strategy for France and setting up of a coordinators’ network and Biodiversity Committee. - Ongoing work to conserve biodiversity in partnership with environmental associations.

9. To encourage the development and dissemination of environmentally friendly technologies.

- Support given to the research and teaching efforts of the VINCI ParisTech Chair in eco-design of building complexes and infrastructure: 13 research projects involving VINCI correspondents and five conferences per year. - First Chair in Eco-design seminar held, with 90 internal decision-makers and partners participating. - Integration of renewable energy and more energy-efficient systems within the Group’s activities and proposals.

Anti-corruption 10. To work towards combating all forms of corruption, including extortion and bribery.

- Further reinforcement of internal controls. - Ongoing distribution of the Code of Ethics and Conduct to all management. - 95% of managers found to be in compliance with the Code of Ethics and Conduct. - Inclusion of social responsibility criteria in the supplier and subcontractor selection process, as well as in framework contracts with VINCI subsidiaries.

139

Report of the Board of Directors

VINCI 2012 Annual Report

Complying with and promoting the fundamental conventions of the International Labour Organisation In addition to the 10 Global Compact principles, VINCI is committed to complying with and promoting among its subsidiaries and partners the provisions of the International Labour Organisation’s fundamental conventions: ˇˇ freedom of association and the effective recognition of the right to collective bargaining; ˇˇ elimination of discrimination in respect of employment and occupation; ˇˇ elimination of all forms of forced or compulsory labour; ˇˇ effective abolition of child labour. Details about various VINCI initiatives are contained in the “Global Compact implementation” table presented above and in the “Workforce relations and collective bargaining agreements”, “Agreements signed in relation to health and safety at work”, “Equality and diversity” and “Human rights” chapters (pages 144, 147-148 and 166).

1. 1.1

Workforce-related responsibility General human resources policy

See also page 27 of this annual report Manifesto commitment number 7: “Promote sustainable careers together” This section follows precisely and thoroughly Article 225 of France’s Grenelle II Environment Law. It is also based on the principles of the GRI (Global Reporting Initiative), in particular in its version 4 draft, which should be issued in the course of 2013. VINCI’s business model is based on a complementary set of short- and long-term business activities, performed through a decentralised organisation. VINCI’s employees are vital to the success of its business model. Its operating methods therefore prioritise people over systems, and are based on the view that sustained business success requires an ambitious approach to human resources. As part of its forward-looking management approach to jobs and skills, since 2010 the Group has applied employee development plans, involving an annual appraisal for each Group employee, along with the requirement for entities to carry out a collegial workforce review and implement individual development plans covering areas such as job mobility and training. As a major player in sectors that are highly fragmented and extremely competitive, VINCI works hard to set an example. As a result, VINCI is ranked among the top 10 best places to work for French engineering students according to the UNIVERSUM 2012 survey.

1.2 Employment 1.2.1 Workforce

At the end of 2012, VINCI had 192,701 þ employees, up 5.1% relative to 2011, in around a hundred countries. Thanks to a dynamic recruitment and external growth policy, the Group’s workforce has grown by more than 21% over the past five years, with European entities representing close to 83% of the total workforce in 2012. The proportion of employees outside Europe increased slightly, from 15.7% of the total workforce to 17.2% in 2012. In the context of a difficult economic situation in Europe, VINCI’s businesses are implementing a number of human resources management methods, including more coordination between regional activities and solidarity measures to optimise job transfers between regions and sectors in order to keep pace with changing activities.

Workforce at 31 December 2012 by geographical area and by business line Workforce

2012 

2011  2012/2011 VINCI VINCI Immobilier and Construction holding cos.

VINCI Autoroutes

VINCI Concessions

VINCI Energies

Eurovia

Total

%

Total

Change

7,929

2,909

37,675 

24,234 

35,410 

714

108,871 

56.5%

107,426 

1.3%

5 

1,004 

709 

2,357

6,032 



10,107

5.2%

9,358 

8.0%

73 

9,277

4,044

357 

11 

13,762

7.1%

10,716 

28.4%

Benelux

116

3,306 

685 

3,808 

4 

7,919 

4.1%

7,603 

4.2%

Spain

291 

1,164 

416 

51 

1,922

1.0%

2,054 

(6.4%)

Central and Eastern Europe

158 

2,808 

5,092

4,303 

12,361

6.4%

13,121 

(5.8%)

86

3,881 

738

4,705 

2.5%

4,286

9.8%

5 

1,728 

21,145

12,594 

15,289 

50,776

26.3%

47,138

7.7%

81

1,443

2,617

2,943 

3,396

10,480

5.5%

9,926

5.6%



1,207

9,801

11,008

5.7%

11,039

(0.3%)

France United Kingdom Germany

Rest of Europe Europe excl. France Americas Africa Rest of world Total

8,015

15 

1,355 

1,361

1,422

7,428

11,566

6.0%

7,791

48.5%

7,435

64,005

41,193

71,324

729  þ 192,701

100.0%

þ 183,320

5.1%

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

140

Report of the Board of Directors

At the end of 2012, VINCI’s workforce consisted of 83% managers and 17% non-managers, the same as the previous year. The proportion of female employees was stable at 13% of the total workforce. The percentage of women managers increased. Women accounted for 16.4% of managers (15.8% in 2011) and 13% of non-managers. The number of women managers has increased almost 76% in five years.

Workforce at 31 December 2012 by category, gender and business line Workforce

2012

2011 

2012/2011

VINCI Autoroutes

VINCI Concessions

VINCI Energies

Total

%

Total

Change

1,018 

995

10,923

4,798

15,483

446 

33,663

17%

31,706

6%

Men

695

709

9,366

4,179

12,911

295 

28,155

84%

26,696

5%

Women

323 

286

1,557 

619

2,572

151 

5,508

16%

5,010

10%

Non-managers

6,997

6,440

53,082

36,395

55,841

283 

159,038

83%

151,614

5%

Men

4,011

4,901

46,953

32,948

49,739

91 

138,643

87%

132,323

5%

Women

2,986

1,539 

6,129

3,447

6,102

192 

20,395

13%

19,291

6%

Total

8,015

7,435

64,005

41,193

71,324

729

þ 192,701

100%

þ 183,320

5%

Men

4,706

5,610

56,319

37,127

62,650

386

þ 166,798

87%

þ 159,019

5%

Women

3,309

1,825

7,686

4,066

8,674

343

þ 25,903

13%

þ 24,301

7%

Managers

VINCI Eurovia Construction

VINCI Immobilier and holding cos.

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

Workforce at 31 December 2012 by age Workforce

2012  VINCI VINCI Autoroutes Concessions

VINCI Energies

Eurovia

VINCI Construction

VINCI Immobilier and holding cos.

2011 

2012/2011

Total

%

Total

Change

Under 25

281

793

6,833

3,894

8,137

51 

þ 19,989

10%

18,656

7%

26-35

883

2,188

15,922

9,929

21,939

207

þ 51,068

27%

48,824

5%

36-50

4,241 

2,971

25,510

16,810

27,467

304 

þ 77,303

40%

74,327

4%

Over 50

2,610

1,483

15,740

10,560

13,781

167 

þ 44,341

23%

41,603

7%

Total

8,015

7,435

64,005

41,193

71,324

729 

192,701

100%

183,320

5%

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report.

Over the past five years, the share of the workforce aged under 25 has been maintained at around 10%, which is the sign of a sound age pyramid. Also, the share of the workforce aged over 50 has increased 4.5% over five years. In total the under-25s and the over-50s have increased 7%, which is higher than the overall 5% increase in the total workforce between 2011 and 2012.

1.2.2

Recruitment and departures

In five years, VINCI’s workforce has expanded to 192,701 þ employees in 2012 from 158,628 in 2007. Employee turnover of about 27% per year reflects the expiry of worksite contracts, which is offset by the Group’s active recruitment policy adapted to new worksites.

1.2.2.1 Recruitment

In 2012, VINCI hired 52,999 þ people worldwide, including 23,855 on a permanent basis (9,899 in France). The portion of permanent contracts (unlimited term and site contracts) has risen from 41% to over 45% in two years. VINCI’s goal is to accelerate its pace of international hires. During 2012, VINCI again pursued its policy of active recruitment. In particular, 2,309 young people were hired for their first work experience, accounting for 4.3% of all new hires.

1.2.2.2

Types of employment contract

The proportion of permanent jobs has been stable at about 88% of the workforce over the past five years. Of the Group’s þ 192,701 employees worldwide, 168,738 have permanent jobs. In France, especially in the construction sector, site contracts are considered permanent jobs. At 31 December 2012, 19,517 people were employed under fixed-term employment contracts. VINCI promotes local employment and encourages career progression within the Group. Intra-Group transfers increased 22%, rising from 2,400 in 2011 to 2,938 in 2012. Group companies support international volunteering programmes that give graduates the opportunity to work abroad, and 194 people were welcomed under these programmes in 2012. The Group had 1,535 expatriate employees at end-2012. The Group’s business lines use temporary employees to adjust their labour needs to the pace of their business activities and find new profiles for company hiring. In 2012, 15,206 temporary employees (full-time equivalent) worked for VINCI in France.

141

Report of the Board of Directors

VINCI 2012 Annual Report

Workforce at 31 December 2012 by type of employment contract and business line Workforce

2012  VINCI VINCI Autoroutes Concessions

Unlimited-term contracts

Eurovia

VINCI Construction

682 

Total 167,104



1,634

2011 

2012/2011

%

Total

Change

87%

159,525 

5%

1%

1,171

40% 6%

7,772

6,969

58,709

37,984

54,988

5 



213 

109 

1,307 

173

418

2,900

2,175

13,825

26 

19,517

10%

18,477

65

48

2,183

925

1,204

21 

4,446

2%

4,147

7%

8,015

7,435

64,005

41,193 

71,324

729 

192,701 100%

183,320

5%

36

310 

7,902

4,155

15,801

29 

27,267

4%

Site contracts Fixed-term contracts Work-study programmes Total

VINCI Energies

VINCI Immobilier and holding cos.

Temporary employees (full-time equivalent)

28,233

15%

Worldwide intra-Group transfers 2012  VINCI Autoroutes

1.2.2.3

VINCI Concessions VINCI Energies

Eurovia

VINCI VINCI Immobilier and Construction holding cos.

Total

Transfers within a business line

30

26

1,624

370

761

1 

2,812

Transfers to another business line

14 

12 

69 

3

20

8 

126

96% 4%

Total

44

38

1,693

373

781

9 

2,938

100%

Reasons for departure The Contracting business lines (Energy, Roads and Construction) execute their projects at temporary worksites and over a relatively short period. They traditionally employ a large number of people whose contracts expire once the project is completed or who seek employment with another local company to avoid having to move. In the Concessions business, and particularly in the Motorways business line, seasonal variations in activity also explain the relatively large proportion of expired contracts.

Departures by business line (*) Workforce

Expired contracts (**) Resignations

2012 

2011 

2012/2011

Change

VINCI Autoroutes

VINCI Concessions

VINCI Energies

Eurovia

VINCI Construction

VINCI Immobilier and holding cos.

Total

%

Total

7,390

882

3,259

3,205

12,585

35 

27,356

58%

26,849

2%

65

725

3,228

1,720

3,646 

23

9,407

20%

10,213

(8%) 12%



103

720

899

834

1 

þ 2,557

5%

2,290

Dismissals

65

240 

1,722

792 

2,163 

7

þ 4,989

11%

4,620

8%

Other reasons (***)

80 

96

912

825 

1,162

12 

3,087

6%

4,526

(32%)

7,600

2,046

9,841

7,441

20,390

78

þ 47,396

100%

þ 48,498

(2%)

Redundancies

Total

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report. (*) Excluding changes in consolidation scope. (**) Expiry of fixed-term, site or work-study contract, or retirement. (***) Includes termination during trial period, partial loss of business and mutually agreed contract termination (for France).

1.2.2.4

1.3 1.3.1

Workforce reduction and employment protection plans, redeployment efforts, rehiring and support measures

After a period of intense recruitment, some business activities must now contend with restructuring in the context of the economic and financial crisis. Since VINCI’s operations cannot be relocated, senior management and human resources managers work together to ensure economic and social solidarity through job mobility and redeployment plans, which are facilitated by the Group’s extensive presence. Similarly, when VINCI makes an acquisition, it strives to retain staff whenever possible, since they are the guardians of valuable skills and expertise needed to leverage Group synergies, share resources and drive networking. Some Group companies occasionally implement redundancy plans or redeploy employees. VINCI’s Human Resources Department and local HR managers regularly review sites that are experiencing business or employment difficulties.

Organisation of working hours Hours worked and overtime

Working hours in all VINCI Group companies are subject to each country’s legal requirements and collective bargaining agreements. In 2012, employees worked almost 328 million þ hours. There were 14 million overtime hours, representing 4% of the total worked. Compared with 2011, overtime hours worked fell 16%.

142

Report of the Board of Directors

Hours worked and overtime 2012  Total hours worked

2011 

2012/2011

Managers

Non-managers

Total

Total

Change

54,904, 384

272,927,257

þ 327,831,641

þ 314,593,387

4%

387,667

13,272,764

þ 13,660,431

þ 16,284,851

(16%)

715

5,295

6,010

þ 4,885

23%

Of which overtime Number of part-time employees (*)

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.. (*) Methodology reviewed in 2012.

1.3.2 Absenteeism

Employees were absent from work for 3.4 million calendar days in 2012. Non-occupational illnesses accounted for 59% of these absences. Days absent represented 8% of the 44 million days worked worldwide, of which over 23 million in France. The change in data between 2011 and 2012 is partly explained by a change in the calculation method.

Days of absenteeism by cause 2012  VINCI Immobilier VINCI and holding Eurovia Construction cos.

2011 

2012/2011

Total

Change

VINCI Autoroutes

VINCI Concessions

VINCI Energies

109,044

48,299

702,246

528,373

586,193

5,473

1,979,628

59%

1,961,314

1%

Work accident

6,838

6,581

45,951

40,501

87,180

5

187,056

5%

210,477

(11%)

Commuting accident

1,395

1,268

10,357

7,911

9,418

14

30,363

1%

34,868

(13%)

Occupational illness

1,567



16,078

21,205

19,374



58,224

2%

64,550

(10%)

14,683

12,320

64,793

39,322

79,215

2,449

212,782

6%

182,732

16%



181 

6,383

7,839

43,358



57,761

2%

38,443

50%

25%

667,655 

28%

(In number of calendar days) Non-occupational illness

Maternity/paternity leave Short-time work Other cause Total

26,671

16,066

156,784

160,198

84,715

1,002,592

337,019  982,170

Total

313,990

1,276

851,806

1,138,728

9,217

þ 3,377,620

100% þ 3,160,039

7%

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

1.4 1.4.1

Remuneration, social security payments and employee savings

See also page 28 of this annual report Manifesto commitment number 8: “Share the benefits of our performance together”

General policy

The remuneration policy is based on common principles of allowing employees to take part in their company’s success through profit-sharing and incentive plans that reward individual performance. It is in keeping with the Group’s decentralised management structure. These principles are implemented through different means in the various countries where VINCI operates, in accordance with national contexts, laws and regulations. Employee remuneration takes different forms: wages, bonuses, profit-sharing, incentive plans, employee share ownership, insurance and retirement plans, and other company benefits. VINCI supports all of these. All employees, regardless of position, are rewarded in accordance with their responsibilities and performance. At the end of 2012, 92% of employees in France benefited from incentive plans and/or profit-sharing agreements. In total, VINCI employees in France shared in the Group’s growth and success through the distribution of €163.4 million under profit-sharing and incentive plans, which represents €3 million or 2% more than five years ago. On 22 May 2012, VINCI signed a Group-wide agreement which enabled each employee to receive a profit-sharing bonus of €367. The agreement was signed, for the second year running, with the majority of the trade unions in France (CFDT, CFTC, CFE-CGC). The bonus, which was the same for each employee regardless of his or her basic salary, was paid in July to employees of Group companies controlled by VINCI. The Group exceeded its statutory obligations by paying the bonus to those working at companies with fewer than 50 employees (around 100,000 VINCI staff). This bonus payment amounted in total to €36.3 million for the Group, compared with €33.7 million in 2011.

Employment benefits and employee share ownership (in € millions)

2012 

2011 

2012/2011 change

of which France 2012

of which France 2011

2012/2011 change

Incentive plans

71.0

82.2 

(14%)

66.7

74.5 

(10%)

Profit-sharing

98.3 

99.2 

(1%)

96.7 

98.2 

(2%)

Welfare

39.8 

38.4 

4%

35.2 

33.3

6%

Employer contribution

97.3

93.9

4%

96.5

93.9

3%

Profit-sharing bonus

36.3

33.7 

8%

36.3

33.7 

8%

342.7 

347.4

(1%)

331.4 

333.6

(1%)

Total

1.4.2

143

Report of the Board of Directors

VINCI 2012 Annual Report

Remuneration and social security payments

Payroll expenses totalled €6 billion in 2012 (€5.6 billion 2011), equal to 15.5% of revenue in 2012 (15.3% in 2011). Payroll-to-revenue has remained stable in the past five years. Remuneration and social security payments vary widely from country to country. There is also a high level of disparity between the salary scales (pay gaps) of the “manager” and “non-manager” categories. The level of social security payments also varies radically from country to country. VINCI presents these consolidated figures for the world and France. For France, the presentation shows more precise segmentation: managers; office, technical and supervisory staff; and manual workers. Figures designate gross annual averages in thousands of euros.

Remuneration and social security payments worldwide Total

Managers

Non-managers

2012 

2011 

2012 

2011 

2012 

2011

Average VINCI salary

þ 31.2 

þ 30.9 

58 

55 

26 

26 

Men

þ 31.6 

þ 31.3 

60

58 

26 

26 

Women

þ 28.8 

þ 28.2 

44 

43 

25 

24 

39%

40%

41%

43%

38%

38%

(in € thousands)

Social security payments

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

Remuneration and social security payments in France Total

Managers

Manual workers

2012 

2011 

2012 

2011 

2012 

2011 

2012 

2011 

Average VINCI salary

35 

35 

61 

60 

31 

31 

26 

26 

Men

36 

35 

64 

63 

32 

32 

26 

26 

Women

33 

32 

48 

47 

28 

27 

24 

23 

49%

49%

51%

51%

51%

50%

45%

45%

(in € thousands)

Social security payments

1.4.3

Office, technical and supervisory staff

Employee savings plans

VINCI continued its employee savings efforts, carrying out three share issues during the year as provided for under the terms of its Group Savings Scheme in France. The regularity of share issues ensures the strength and continuity of this scheme, which has been available to employees since 1995.

Employee investment in the Castor fund, which invests exclusively in VINCI shares, is encouraged through a 10% discount on VINCI’s share price and a sliding scale of employer contributions aimed at encouraging savings by the lowest-paid employees. Employer contributions in 2012 were as follows: ˇˇ 100% up to €1,000; ˇˇ 70% from €1,001 to €3,000; ˇˇ 25% from €3,001 to €5,000; ˇˇ 10% from €5,001 to €11,000. The maximum employer’s annual contribution per employee is thus €3,500 (see also page 237 of this report for information on 2013). The total employer’s contribution was €96.5 million for France in 2012. Employees owned almost 10% of the Group’s share capital at the end of 2012, their confidence in VINCI’s future making them once again collectively its largest shareholder. At the end of September 2012, around 112,285 employees owned shares in VINCI through one of the Group’s investment funds. The average portfolio was worth about €17,000. Created in April 2011, VINCI’s Employee Shareholders’ Circle provides a new perspective on the Group through discussions between employee shareholders. The Circle boasted 10,800 members at 31 December 2012. During the year under review, VINCI continued to promote “Rediscover your city” events, a concept highlighting the role of its businesses in the development of major urban conglomerations. Almost 800 members went on cruises organised in Paris, Bordeaux and Lyon, and the first discovery visit was organised in Marseille on 29 September. The trips to discover VINCI projects were appreciated, with 40 people attending the visit to the A89 worksite, 180 going on the two visits to the Stade de France and 40 visiting the MMArena in Le Mans. The Circle offers a toll-free phone number and a secured and personalised space on VINCI’s Internet and intranet websites. Employee shareholders may use these facilities to register as Circle members or participate in events. The twice-yearly newsletter “En Direct” keeps readers informed of Group events and news. To support its international business development, VINCI wanted to extend its employee savings arrangements by giving employees in countries other than France the chance to acquire (directly or indirectly) VINCI shares at preferential prices and thereby give them a greater interest in VINCI’s financial performance and growth. In 2012, a plan was initiated to benefit employees of subsidiaries in which VINCI owns more than a 50% stake in 14 countries (the employees must have been with the Group for at least six months). The plan covers around 300 subsidiaries and 45,000 employees. Subject to holding their shares for three years (five years in the UK), employees may receive an employer contribution from VINCI in the form of a bonus share award, deferred for three years to avoid initial taxation (with exceptions) and dependent on employees remaining with the Group for the required time period. The countries concerned are Belgium, Canada, the Czech Republic, Germany, Morocco, the Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Switzerland, the UK and the USA.

144

Report of the Board of Directors

Total employee participation came to nearly 25%. In view of this plan’s success, VINCI has decided to reinitiate a similar plan in 2013 with coverage extending to five other countries, depending on legal feasibility: Austria, Brazil, Chile, Indonesia and Luxembourg. This will increase the plan’s coverage to 60% of employees based outside France. The Group’s collective retirement savings plan, Perco Archimède, came into force in December 2010 in France following the collective agreement with French trade unions CFDT, CFE-CGC and CFTC on 25 June 2010. It rounds out the Group Savings Scheme, and is gradually gaining in popularity. This new plan was established to allow employees to offset reduced income from mandatory pension plans and to save for retirement under more attractive terms than they could obtain individually. It allows them to: ˇˇ receive a lump-sum payment or an annuity upon retirement; ˇˇ manage their investment themselves or opt for guided management; ˇˇ select from a wide range of investment vehicles in accordance with their particular savings or investment profile. VINCI makes 50% matching contributions, limited to €200 a year for an employee contribution of €400. At end-September 2012, about 18% of employees had joined the Perco Archimède plan, 67% of whom were under the age of 50. The average portfolio value of nearly €874 represents an increase of 43% over 2011; 62% of investments were being managed by employees themselves, with 38% opting for guided management.

1.5 1.5.1

Labour relations and collective bargaining agreements General policy regarding dialogue between management and labour

VINCI’s policy regarding dialogue between management and labour reflects its fundamental principles: recognising the role played by trade unions in the Group and the right of employees to belong to a union; achieving a constant balance between union involvement and close links with professional activities; facilitating communication and meetings between trade union representatives and employee representative bodies; ensuring that employee and trade union representatives are properly informed and trained by involving them in the Group’s major initiatives (e.g. in the areas of health, safety, sustainable development, gender equality, and employing people with disabilities); and working to foster communication and collective bargaining worldwide. As laid down in the Group’s new Manifesto, dialogue between management and labour is of capital importance to the discussion of and implementation of its commitments. VINCI’s decentralised organisational structure enables it to maintain dialogue between management and labour at all levels throughout the Group. In 2012, 8,181 employees around the world served as employee representatives (including 7,431 in France). An overall budget of €205,000 is distributed between all the unions as a function of their membership with the aim of assisting them and giving them the means of representing the staff. In those countries that have not ratified the International Labour Organisation’s conventions on trade union rights, VINCI companies are working to give employees the means of expressing themselves. QDVC in Qatar, for example, has set up an experimental forum that enables workers to express themselves through identified representatives.

1.5.2

Employee representative bodies

Employee representative bodies strengthen dialogue between management and labour by working locally with the various organisations that oversee occupational hygiene, health, safety and working conditions. A number of organisations covering specific cases or national situations have been set up to complement individual companies’ employee representative bodies. France, for example, has a Group Works Council comprising representatives from over 50 entities. It meets at least twice a year and receives information about the Group’s business and financial situation, employment trends and forecasts, and health and safety actions at Group and company levels. It is kept informed of the economic and business outlook for the coming year and has access 
to the Group’s consolidated financial statements and the associated Statutory Auditors’ reports. It is also informed, prior to any decision, of any significant projects that may affect the Group’s consolidation scope or its legal or financial structure, and of their potential impact on employment. In certain business lines, bodies have also been established for each business activity; VINCI Energies, for example, has created two extra employee representative bodies in order to ensure the continuity of dialogue between management and labour. The European Works Council takes up discussions within these various local or national organisations at the European level. The council’s mandate, renewed in 2010 under an agreement unanimously approved by all unions, is composed of representatives from 17 countries in which VINCI operates: Austria, Belgium, the Czech Republic, France, Germany, Greece, Hungary, Luxembourg, the Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Sweden, Switzerland and the United Kingdom. The role of the council, which meets once a year, is to ensure that the employee representatives of the Group’s subsidiaries in the European Economic Area and Switzerland are properly informed and consulted.

1.5.3

1.5.4

Trade union freedoms

VINCI companies observe the laws and regulations of the countries in which they do business. Operational managers are assisted by human resources managers, who propose the most appropriate solutions in compliance with local requirements and VINCI’s commitments to observe trade union freedoms. Since 89% of the Group’s business is in Europe, the European Works Council is the prime guarantor of freedom of association and the right to organise.

Collective agreements in 2012

The collective agreements negotiated and signed by VINCI companies are a concrete example of the Group’s decentralised approach to human resources management, which takes account of the realities on the ground and aims to improve working conditions, health, safety and the organisation of working hours. In 2012, 1,347 collective agreements were signed, with 242 of them being outside France. An agreement to promote dialogue between management and labour within the French companies of the VINCI Group was signed with labour representatives on 16 December 2011, affirming consultation with employee representatives as one of VINCI’s core values. The agreement provides for an improvement in information forwarded to employee representatives and for assistance for them during and following the expiry of their terms. A joint commission has been set up to offer an alternative to disputes about restrictions on exercising terms of office to represent staff. At the end of the term of office, the representatives have the possibility, under certain conditions (commitments and length of term of office), of taking a training course that will lead to a qualification enabling them to make use of the skills acquired.

VINCI 2012 Annual Report

145

Report of the Board of Directors

Among major achievements in 2012, over 12% of agreements relate to diversity and equality (up 63% from 2011).

Collective agreements by category 2012  144

10.7%

95 

51.6%

163

12.1%

100

63.0%

Union rights

77

5.7%

43

79.1%

Training

14 

1.0%

17

(17.6%)

25

1.9%

36

(30.6%)

112

8.3%

81 

38.3%

54 

4.0%

54 

0.0%

700

52.0%

595 

17.6%

Pensions

16

1.2%

24

(33.3%)

Other

42

3.1%

34 

23.5%

Total

1,347 

100.0%

1,079

24.8%

Welfare Remuneration and benefits

1.6.1

2012/2011 change

Equality and diversity

Health and safety

1.6

2011 

Flexible work arrangements

Workforce planning system

1.5.5

Portion of total agreements

Collective conflicts

In 2012, employee absences due to strikes totalled 8,702 days (of which 3,729 in France), equal to fewer than 0.1% of total days worked. Salary demands were the main cause of the strikes.

Health and safety

See also page 25 of this annual report Manifesto commitment number 5: “Strive for zero accidents together”

General health and safety policy

Achieving zero accidents remains VINCI’s priority and all employees are working to that end. The goal, reiterated in VINCI’s new Manifesto, applies not only to VINCI employees, but also to temporary staff and anyone else working on a VINCI site, including the employees of joint contractors and subcontractors. The Group encourages and supports its subcontractors and suppliers in this effort; it also shares its resources with them and involves them in safety actions. In five years, this approach has reduced the frequency of lost-time accidents by 23% and their severity by almost 7%. In 2012, the Group put particular emphasis on staff from temporary employment agencies. The agencies were selected as partners in 2011 through the negotiation of a framework contract covering the entire Group in France. They were required to provide the first non-financial information attesting to their compliance with the efforts agreed upon and actually carried out vis-à-vis their personalised improvement plans provided by VINCI. The resultant measures will be examined following the implementation of the contract in order to gauge the progress of each agency, notably with respect to health and safety. Eurovia organised for the first time simulation exercises with France’s civil defence force, which intervenes in times of major disasters in France and the rest of the world. The six scenarios proposed sharply heightened employees’ awareness and provided the opportunity to assess the quality of the business line’s internal procedures. VINCI Autoroutes launched a “Sécurité 100% chantiers” (100% worksite safety) programme with the goal of achieving zero accidents at all sites where it is in charge of works. A seminar at the end of September brought together some 60 occupational health and safety specialists to exchange their experiences in other business sectors and thereby bring change to practices. In the United Kingdom, all VINCI plc employees participated in a “Take a Break for Safety” day to discuss and identify innovative solutions between the Group’s various business units. VINCI Construction France also organised at all its worksites a safety day involving more than 18,000 employees on 1,763 sites. Over 400 senior managers participated in 23 theme-based events in 2012 in order to promote cross-business sharing of know-how and best practices.

1.6.2

Health and safety of VINCI employees

The main objectives of the Group’s health and safety policy are to anticipate and prevent occupational health and safety hazards (including psychosocial risks and harassment); to ensure the quality of hygiene, health, safety and living conditions in the workplace; and to redeploy employees who have suffered an occupational accident or illness. VINCI’s health and safety policy is led by a coordination system that includes all the health and safety coordinators in the Group’s business lines and divisions worldwide. Its aim is to foster the sharing of best practices, improve the reliability of health and safety indicators, and examine new ways of enhancing performance in keeping with the specific situation of each business activity. The establishment of a policy for managing near accidents at Eurovia and the exemplary no accidents day at VINCI Construction France were among the highlights of 2012. Actions to promote health and safety include substance-abuse awareness, training and employee support campaigns; ergonomic studies of workstations; equipment adaptation and mechanisation; improvements to worksite organisation; and employee training to prevent musculoskeletal disorders and other occupational illnesses.

146

Report of the Board of Directors

Lost-time work accidents affecting VINCI employees Number of days lost through occupational illness and its severity rate at VINCI companies Group

of which France 2012/2011 change

2012 

2011 

2012/2011 change

2012 

2011 

Lost-time accident frequency rate (*)

þ 8.60

þ 10.30 

(16.5%)

11.62

13.32 

(12.8%)

Lost-time severity rate (**)

þ 0.57 

þ 0.67 

(14.9%)

0.89 

1.05

(15.2%)

63%

60%

58%

54%

Percentage of companies with zero lost-time accidents

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report. (*) Lost-time accident frequency rate = (number of lost-time accidents x 1,000,000)/number of hours worked. (**) Lost-time accident severity rate = (number of days of time off due to work accidents x 1,000/number of hours worked.

Frequency and severity rates of lost-time accidents by business line Frequency rate Concessions VINCI Autoroutes VINCI Concessions

Severity rate

2012 

2011 

2012 

9.77

10.44

0.57

2011  0.47 

9.85

11.41

0.62 

0.66 

9.69

9.62

0.52 

0.30 

8.54

10.31

0.57 

0.69 

VINCI Energies

8.21

9.77

0.46 

0.61 

Eurovia

7.43

8.41

0.57 

0.64 

Contracting

VINCI Construction Group

9.39

11.74

0.66 

0.78 

þ 8.60

þ 10.30

þ 0.57 

þ 0.67 

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

The proportion of companies reporting no accidents has risen from 47% to 63% in five years. Occupational illnesses were responsible for 2% of total days of absence in 2012 (as in 2011), representing 58,224 days of the 44 million worked. Number of days lost through occupational illnesses and its severity rate at VINCI companies Group

Days lost through occupational illness Occupational illness frequency rate (*) Occupational illness severity rate (**)

of which France 2012/2011 change

2012 

2011 

2012/2011 change

2012 

2011 

58,224

64,550

(9.8%)

57,590

61,366

(6.2%)

2.46

1.03 

138.8%

4.93

1.96 

151.5%

þ 0.18

þ 0.21 

(14.3%)

0.35 

0.38

(7.9%)

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report. (*) Occupational illness frequency rate = (number of occupational illnesses recognised x 1,000,000)/hours worked. (**) Occupational illness severity rate = (number of days lost through occupational illness x 1,000)/hours worked.

1.6.3

Health and safety of temporary staff

As an absolute priority for VINCI, the “zero accident” policy also applies to temporary staff. Under the terms of framework agreements, temporary employment agencies participate directly in the Group’s health and safety policy. These agencies were selected on the basis of criteria including the health and safety of temporary staff, and they implement improvement plans. The substantial difference between the accident frequency rates of VINCI employees and temporary staff reflects differences in the jobs performed, in technical know-how and experience, and in safety awareness and culture. Reports on work accidents involving temporary staff enable concrete action to be taken to prevent them from recurring. These measures reduced the accident frequency rate of temporary staff in VINCI companies in France by 4.3% in 2012 compared with 2011.

VINCI 2012 Annual Report

147

Report of the Board of Directors

Lost-time work accidents involving temporary staff by business line Accident frequency rate in France (*) Concessions VINCI Autoroutes VINCI Concessions

2012 

2011 

6.85

14.44

2012/2011 change (52.6%)

0.00

8.19

(100.0%)

7.90

16.54

(52.2%)

27.62

28.70

(3.8%)

VINCI Energies

22.36

24.79

(9.8%)

Eurovia

22.67

21.33

6.3%

‌VINCI Construction

33.22

34.82

(4.6%)

27.20

28.42

(4.3%)

Contracting

Total

(*) Temporary staff lost-time accident frequency rate = (number of lost-time accidents involving temporary staff x 1,000,000)/number of hours worked by temporary staff.

1.6.4

Subcontractor health and safety

Subcontracting accounted for €7.46 billion in 2012, around 19% of revenue. In VINCI’s business lines, subcontracting is multifaceted with a diversity of levels, and some VINCI companies also act as subcontractors. Under such complex circumstances, many VINCI companies have signed framework contracts with their subcontractors. The “zero accident” policy is in all of these contracts and arrangements. Special clauses covering accident prevention require, for example, that personal protective equipment be worn, work accidents reported and any change in work hazards notified. In a separate initiative, Cofiroute has prepared a guidebook of best safety practices for its subcontractors. The ASF group has set up a “contractor zero accident” policy that sets out 10 rules to be followed from design to operations in order to enhance H&S monitoring at the worksites they manage. At VINCI plc, Step-up training has helped heighten the awareness of more than 2,000 British employees and made it possible to reduce accident frequency 40% since 2010. This tool is also used with 40 Group subcontractors.

1.6.5

Health and safety agreements

As part of its health and safety policy, VINCI negotiates and enters into specific agreements with trade unions and employee representatives on subjects related to improving staff working conditions, thereby enhancing the overall performance of Group companies. One of the main subjects of collective bargaining in 2011 was the prevention of factors that make work more arduous, with the aim of optimising working conditions in VINCI businesses.

1.7 Training

See also page 27 of this annual report Manifesto commitment number 7: “Promote sustainable careers together”

1.7.1

General training policy

The Group is pursuing its goal of offering career and personal development opportunities to all its 192,701 þ employees to develop in each of its markets the professional know-how and personal life skills to best respond to clients’ needs and be their best partner. Given its decentralised organisation and determination to generate synergies in its business activities, skills development is concentrated in two areas. Each business line has set up internal training centres adapted to its businesses and needs: ˇˇ the Cesame centres (VINCI Construction); ˇˇ the VINCI Energies Academy, which absorbed Cegelec Group University; ˇˇ the Road Industry Training Centre (Eurovia), one of whose sites celebrated its 20th anniversary in 2012; ˇˇ the VINCI Park School (VINCI Concessions), and Parcours ASF and Cofiroute Campus (VINCI Autoroutes). Training reflects actual operations in the Group’s various countries as closely as possible. In international operations during 2012, VINCI  Construction Grands Projets opened three new “worksite schools”: in Chile (the El Teniente mine); in Malaysia (the Berjaya Central Park in Kuala Lumpur); and in Turkmenistan (government headquarters). Soletanche Freyssinet initiated training for project managers with the aim of developing international standards in the management of specialised civil engineering projects, be it in safety, quality or profitability. More than 120 interns from some 15 countries have already followed this programme, which will include 400 engineers representing 30 nationalities between now and 2014. The VINCI Energies Academy has established a dozen training programmes in Brazil, all led by local trainers. In addition to training centres for specific business lines or divisions, the VINCI Academy provides training to executives in order to support the Group’s international development and promote synergies. A club has also been set up to give training centre managers an opportunity to share experiences and pool resources. Additional e-learning sites were opened in 2012 at Soletanche-Bachy, Freyssinet, VINCI Construction Terrassement, VINCI Construction UK and VINCI Airports, following the establishment of those of the VINCI Academy, VINCI Energies Academy, and of the training centres of Eurovia and VINCI Construction France in fourth quarter 2011 on a shared platform. VINCI has maintained its proactive policy regarding work-study programmes by signing a “Charter in favour of training through work-study programmes” with France’s ministry for apprenticeships and professional training. By signing this charter, VINCI made nine commitments: to increase the number of young people on work-study programmes; to promote their integration into the workforce; to involve staff to enhance the image of work-study programmes; to develop mentoring; to reduce drop-out rates from work-study programmes; to involve higher education institutions and elite universities; to create favourable conditions for the development of work-study programmes; to provide information and raise awareness; and to promote and disseminate best practice.

148

1.7.2

Report of the Board of Directors

Training initiatives

In 2012, an average of 16 hours of training per employee was provided within the Group, with managers receiving 20 hours and non-managers 15. Almost €167 million was spent on training in 2012; 3 million hours of training (up 7% relative to 2011) were devoted to technical and health and safety matters. In 2012, environment training increased almost 5%, and diversity training more than 45%. VINCI’s goal is to foster the professional development of all its employees by providing each of them with personalised training. This goal was confirmed in 2012, when 116,484 þ employees received training.

Expansion of in-house training centres Business line

Number of training hours in 2012

Training centre

Concessions ‌VINCI Autoroutes

Campus Cofiroute, Parcours ASF

‌VINCI Concessions

VINCI Park School

Contracting ‌VINCI Energies

VINCI Energies Academy, Cegelec Group University

‌Eurovia

Road Industry Training Centre

‌VINCI Construction

Cesame, Eugène Freyssinet Centre

Total

2012/2011 change

Number of trainees in 2012

2012/2011 change 15.7%

185,865

14.2%

20,791

160,220

12.0%

18,573

14.1%

25,645

30.5%

2,218

30.9%

533,506

(7.0%)

29,888

(3.6%)

136,029

(9.1%)

9,703

2.4%

97,842

(0.0%)

3,127

14.5%

299,635

(8.2%)

17,058

(9.3%)

719,371

(2.3%)

50,679

3.4%

Breakdown of training hours by subject and by number of hours 2012 

2011 

2012/2011

of which France

Total

Change

Managers

Nonmanagers

Men

Women

Total

Technical

238,891

1,106,252

1,208,633

136,510

1,345,143

44.3%

868,921

1,291,801

4.1%

Health and safety

142,385

849,188

923,382

68,191

991,573

32.7%

719,079

852,542

16.3%

Environment

10,889

33,094

36,922

7,061

þ 43,983

1.4%

23,177

þ 46,133

(4.7%)

Management

106,216

86,164

163,534

28,846

192,380

6.3%

123,195

185,999

3.4%

Admin and support

100,370

148,091

158,181

90,280

248,461

8.2%

170,739

238,823

4.0%

49,736

82,047

89,582

42,201

131,783

4.3%

52,228

127,171

3.6%

3,612

11,629

11,647

3,594

15,241

0.5%

9,258

10,481

45.4%

16,365

70,100

2.3%

22,937

84,626

(17.2%)

393,048 þ 3,038,664

100.0%

1,989,534

þ 2,837,576

7.1%

18 

16 

0.0%

Languages Diversity Other

17,535

52,565

53,735

Total

669,634

2,369,030

2,645,616

20

15

16 

Hours of training per employee

16 

16 

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

More than 5,500 young people received training under work-study programmes within VINCI in 2012. The Group especially encourages handing on expertise from one generation to the next, particularly through mentoring. At VINCI Construction France, 300 highly experienced and skilled workers, site managers, team managers and engineers (a 20% increase from 2011) have acquired “Master Builder” status and are committed to passing on their knowledge. At ASF, 399 in-house trainers, of which seven technical safety trainers and 79 mentors, provide training.

1.8 1.8.1

Equality and diversity

See also page 26 of this annual report Manifesto commitment number 6: “Foster equality and diversity together”

General policy for promoting diversity and preventing discrimination

In this area, VINCI is pursuing the pioneering policy it adopted in 2004, which is based on preventing any type of discrimination in its hiring, training, promotion and remuneration of employees and in their working conditions, as well as ensuring equality for everyone, with a special focus on gender equality, people with disabilities, people from an immigrant background and people over the age of 50. In a speech before 180 executives, operational managers and human resource managers from many Group countries, at the in-house diversity day on 5 April 2012, the Group’s chairman and chief executive officer reiterated his convictions and VINCI’s commitment and priorities to diversity. The heads of the Group’s business units, backed by the comments and experiences from four other major companies, led discussions about the day’s key point, the sharing of best practices. For the second year in a row, diversity was the second main topic of dialogue between management and labour. The number of collective agreements signed on diversity and equality more than doubled, rising from 43 in 2010 and 100 in 2011 to 163 in 2012, amounting to 12% of all agreements. Self-diagnosis and audits VINCI’s sustainable development self-diagnosis method, Advance, makes it possible for the management bodies of Group companies to assess their performance and establish a shared diagnosis of efforts to promote diversity and prevent discrimination (among other things). It enables entities to identify their weak points and establish their own improvement plan. The results of the various 2012 self-diagnoses show that the overall drive to promote diversity has been launched, but that close and continuous tracking, backed by the use of management tools, is required.

149

Report of the Board of Directors

VINCI 2012 Annual Report

The self-diagnoses are supplemented in the case of some subsidiaries by in-house audits or outside accreditations, enabling them to implement their improvement plans. In 2012, for example, VINCI plc was awarded the British Investors in Diversity (IiD) award scale 2 (on a scale of 3). VINCI plc is thus becoming one of the first construction firms in the UK to be recognised at this stage of maturity for its promotion of diversity, equality and inclusion. In France, Fournié Grospaud Synerys of VINCI Energies was awarded diversity accreditation. Diversity network In 2011, VINCI set up a worldwide network of diversity coordinators and trainers, with the aim of implementing the Group’s policy at the local level by strengthening links between VINCI’s business activities and geographical areas and by promoting best practices. At the end of 2012, the network consisted of 75 people, most of whom are human resources managers and operational managers. Each member of the network attended a three-day in-depth training course, covering both theory and practice. It included a review of discrimination concepts, the various dimensions of diversity, key factors for action and progress, ways to promote a diversity policy, and training skills. New tools are regularly created and provided to coordinators and trainers. For example, there is the “diversity booklet”, published in English and French, consisting of 250 best practices identified within the Group, diversity self-assessments, quizzes and diversity newsletter. This booklet enables coordinators and operational managers to identify the steps towards successful diversity management. Diversity training Diversity training, included as part of the training programme for the Group’s operational managers, continued, with 15,241 hours provided in 2012. Furthermore, surveys of managers who had taken part in this programme showed that they had a better understanding of how stereotypes can influence their decisions. To make progress in this area, VINCI is an active member of France’s Managers for Diversity (AFMD), the corporate social responsibility monitoring agency (ORSE), and the Institut du Mécénat de Solidarité (IMS). VINCI frequently contributes to public discussions on this subject.

1.8.2

Measures to promote gender equality

VINCI has the objective of achieving a significant improvement in its gender mix. In particular, it intends to increase the proportion of women in managerial roles to 20% by 2015, from 16.4% in 2012. A plan of action was prepared in 2012, addressing VINCI’s attractiveness and recruitment methods, as well as its career development opportunities. To enhance the appeal of Group business lines, VINCI continues to participate in the “Capital Filles” programme, which provides mentoring to young female students in disadvantaged areas. The programme also encourages apprenticeships, enabling these students to discover and learn about businesses of the future, as well as scientific and technical roles traditionally filled by men. In 2012, VINCI boasted 65 mentors between the companies of VINCI Construction France and Eurovia, helping schoolgirls in nine school districts in France. A second programme was established in 2012 in order to increase the Group’s appeal among higher education students: VINCI set up a network of Group Ambassadors and staff, mainly engineers, with the aim of promoting business lines by talking to students about their own career paths, mainly in engineering schools, during meetings or discussion conferences, on or off campus. The network, which is poised for expansion, counted 24 ambassadors in its first year. Women employees by business line and percentage of total business in workforce 2012 

2011 

2012/2011

Total

Percentage of women

609

30%

4,525

34%

5,134

33%

5,262 

(2%)

‌VINCI Autoroutes

323

32%

2,986

43%

3,309

41%

3,451

(4%)

‌VINCI Concessions

286

29%

1,539

24%

1,825

25%

1,811

1%

4,748

15%

15,678

11%

20,426

12%

18,715

9% 9%

Managers Concessions

Contracting ‌VINCI Energies ‌Eurovia ‌VINCI Construction VINCI Immobilier and holding cos. Total

Non-managers

Change

1,557

14%

6,129

12%

7,686

12%

7,049

619

13%

3,447

9%

4,066

10%

3,932

3%

2,572

17%

6,102

11%

8,674

12%

7,734

12%

151

34%

192 

68%

343

47%

324

6%

5,508

16%

20,395

13%

þ 25,903

13%

þ 24,301

7%

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

1.8.3

Measures to promote the employment and social integration of disabled people

The Group’s strategy has two main strands: the redeployment of staff no longer able to perform their current roles and the hiring of disabled people. There is a further strand in France, i.e. increasing the use of companies and non-profit organisations that specifically employ people with disabilities. In meeting VINCI’s commitments, the various business lines adopt strategies appropriate to their organisations. The commitment of VINCI subsidiaries to redeploy staff who become unable to perform their current roles resulted in the creation of Trajeo’h in 2008. Trajeo’h is a nonprofit entity that operates across numerous VINCI companies. Its tasks are to keep these staff in employment and to support Group companies with disability issues. Trajeo’h was initially set up in the Rhône-Alps region, before moving into the Greater Paris region in 2010, to south-east France in 2011 and to Normandy in 2012. The entity is financed by VINCI’s local subsidiaries, and is also supported by the Group’s business lines. In 2012, Trajeo’h’s regional entities carried out 173 initial assessments and provided support to 142 VINCI employees.

150

Report of the Board of Directors

The Group Purchasing Coordination unit has responsibility for the strategy of using companies and non-profit organisations that specifically employ disabled people. This unit acts on the Group’s wish to increase the amount of work subcontracted to such companies and organisations, as discussed on page 164, in paragraph 3.3.2 “Managing relations with suppliers”.

Percentage of employees with disabilities by business line 2012  Managers

3.4%

482 

3.1%

3.1%

16 

1.6%

370 

5.3%

386 

4.8%

4.6%

0.5%

5 

0.5%

91 

1.4%

96

1.3%

1.4%

(4.5%)

296

0.9%

3,184

2.2%

3,480

2.0%

1.9%

9.2%

143

1.3%

1,593

3.0%

1,736

2.7%

2.4%

19.6%

29 

0.6%

739 

2.0%

768

1.9%

1.9%

1.8%

124 

0.8%

852 

1.5%

976

1.4%

1.5%

(0.5%)

‌Eurovia

(0.5%)

7

1.6%

11 

3.9%

18 

2.5%

1.6%

0.0%

324

1.0%

3,656

2.3%

þ 3,980

2.1%

2.0%

7.9%

VINCI Immobilier and holding cos. Total

Change

461

‌VINCI Concessions

‌VINCI Construction

2012/2011

1.0%

‌VINCI Autoroutes

‌VINCI Energies

Total

21

Concessions

Contracting

2011 

Non-managers

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report .

In 2012, €5.5 million of revenue was awarded to companies with workforces made up primarily of employees with disabilities. This represents an increase of 29% in the last two years.

2. Environment 2.1 2.1.1

2.1.2

General environmental policy: together for green growth

See also page 23 of this annual report Manifesto commitment number 3: “Promote green growth together”

Environmental organisation

The implementation of VINCI’s environmental policy, “Promote green growth together”, is built on senior management’s commitment, the empowerment of all operational staff within Group companies and open dialogue with public authorities and environmental protection organisations. To manage environmental risks, operational departments rely on a network of over 500 correspondents who ensure that environmental policy guidelines are observed on the ground. These correspondents work in environment, sustainable development and technical departments, coordinating and ensuring the application of VINCI’s environmental policy in all aspects of day-to-day work. The Group’s Delegation for Sustainable Development oversees this network, organises technical working groups comprising experts from each business line and coordinates the Group’s environmental actions, such as the Biodiversity Task Force, a working group on waste management, the Cities and Regions Pivot Club, and the “Grand Paris” Club. The sustainable development self-diagnosis questionnaire, Advance, is used by all Group companies. Based on the ISO 26000 concept, it enables each subsidiary’s Management Committee to check progress and validate its environmental action plan.

Environmental reporting coverage and scope

VINCI’s environmental reporting system deals with all of the themes listed in Article 225 of France’s Grenelle II Environment Law. It uses the Group’s common financial and social reporting method and is based on guidelines that are modelled on those of the Global Reporting Initiative (GRI) and adapted to the Group’s activities. It covers nearly all of the Group’s companies and uses around 60 quantitative indicators for measuring performance against key environmental parameters such as the consumption of resources and energy, greenhouse gas emissions, waste and recycling, certification, training, environmental incidents and environmental risk provisions. Environmental reports are prepared using updated methodological guidebooks and procedures that are available on the Group’s intranet. The methodological note on page 166 presents a list of these guidebooks and procedures. In 2012, VINCI paid particularly close attention to regulatory developments so that it could comply with new legislation as soon as it came into force.

Environmental reporting coverage (as a percentage) Concessions

2012 worldwide revenue covered

2011 worldwide revenue covered

2010 worldwide revenue covered

94 

93 

93  100 

Contracting ‌VINCI Energies ‌Eurovia ‌VINCI Construction VINCI Immobilier and holding cos. Total

99 

99 

100 

100 

97 

88 

88 

85 

100 

100 

100 

95 

94 

92 

VINCI 2012 Annual Report

151

Report of the Board of Directors

VINCI broadened the scope of its environmental reporting further in 2012. The increase compared with 2011 corresponds to an additional €2.4 billion of revenue covered (up 7%), due mainly to the inclusion of VINCI Construction’s international entities and VINCI Airports. Environmental reporting coverage increased further in 2012 to 95% of total revenue generated by companies in the new scope. The remaining 5% corresponds to short-term projects outside France, which are monitored at each worksite but not consolidated at Group level. VINCI’s Statutory Auditors have been reviewing the Group’s social and environmental reporting system for the past 10 years. Although considerable progress has been made over this period, there is room for further improvement, particularly in the number of indicators and scope of application. In 2012, the Report of the Statutory Auditors expresses limited assurance on a certain number of environmental indicators for the VINCI Group. The indicators are identified by the symbol þ. The Statutory Auditors carried out interviews and surveys on the application of the guidelines at the following subsidiaries: VINCI Construction Grands Projets, Eurovia, VINCI Autoroutes (ASF), VINCI Construction France, VINCI Energies France, VINCI Energies International and VINCI plc (UK), i.e. at least one entity from each VINCI business line. Environmental data is presented in compliance with Decree No. 2012-557 of 24  April 2012 on companies’ disclosure requirements for social and environmental data, in application of Article 225 of France’s Grenelle II Environment Law of 12 July 2010. Having been one of the first companies in France to support voluntary audits of its data, VINCI is continuing its efforts to increase transparency with respect to stakeholders and make this an important element in assessing its performance. The figures presented in this report are consolidated using the same method as VINCI's financial data, with the exception of some VINCI Construction Grands Projets and CFE entities, in particular QDVC and DEME, which are still consolidated on the basis of VINCI’s shareholding.

2.1.3

Environmental training

All VINCI companies make efforts to raise awareness of environmental issues. Despite a 5% fall from 2011 to 2012, environmental training hours have more than doubled in the space of five years (up 111%). Environmental training was increasingly incorporated into existing courses (works, studies, operations, etc.) in 2012. Awareness is proactively promoted at worksites (including subcontractors) with the 15-minute environment sessions. This initiative has been rolled out across all activities in the Contracting business in France and is being developed abroad. Environmental training is systematically provided at the Entrepose Contracting and VINCI Construction Grands Projets worksites. Additional training sessions on energy performance, environmental certification (BREEAM, LEED) and the eco-design of buildings and neighbourhoods were provided to meet market expectations in the sustainable city sector.

Environmental training and awareness Number of hours of training

2012/2011

2012 

2011 

Change

9,633 

12,537 

(23%)

9,514 

11,289 

(16%)

119 

1,248 

(90%)

34,346

33,589 

2%

5,548 

6,522 

(15%)

‌Eurovia

18,642 

17,741 

5%

‌VINCI Construction

10,156 

9,326 

9%

4 

7 

(43%)

þ 43,983 

þ 46,133 

(5%)

Concessions ‌VINCI Autoroutes ‌VINCI Concessions Contracting ‌VINCI Energies

VINCI Immobilier and holding cos. Group total

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

2.1.4

Preventing environmental incidents

Each Group entity prepares and updates environmental incident prevention plans that address its specific environmental risks. The most significant projects undergo a preliminary analysis of environmental risks, which serves to determine the equipment and procedures required to prevent or mitigate any such risks. Specific documents and equipment are provided to help prepare for and respond to emergency situations. At VINCI Construction France, for example, engineering and design departments, construction managers and skilled site workers receive environmental risk prevention training tailored to the specific features of their activities. The training covers both regulations and the sharing of best practices. In 2012, VINCI or its subcontractors were involved in six major environmental incidents (eight in 2011). A major incident is defined as one that creates extensive pollution requiring clean-up by external specialists and has consequences stretching beyond the entity’s responsibility. Three of the incidents resulted in water pollution, two in soil pollution and one in the spillage of hazardous materials on a road in the United Kingdom. They were all handled in accordance with applicable regulations.

2.1.5

Environmental certification

VINCI encourages its companies to obtain ISO 14001 or similar environmental certification to confirm and improve the effectiveness of their environmental management system. Companies in the Contracting business lines continued their efforts in this area in 2012; change – including in the integration of new companies and the development of new business activities, for example – is analysed over several years. Significant progress was also made towards ISO 14001 certification of operational activities, particularly at VINCI Autoroutes, which has had all its motorways certified as part of its eco-motorway programme, and at VINCI Facilities as part of its Green Facilities offering.

152

Report of the Board of Directors

At VINCI Immobilier, all new residential property development projects comprise low-energy buildings associated with environmental accreditations such as HQE, H&E and HPE, or energy-positive buildings such as the Amplia residence, a 66-unit programme located in the Lyon Confluence district. VINCI companies have acquired substantial expertise in meeting a variety of environmental standards, including HQE, BREEAM and LEED. In 2012, VINCI plc delivered the BBC studio complex, the first project of its kind to achieve an “Outstanding” rating by BREEAM (the highest assessment rating). Meanwhile, VINCI Energies entities have developed an HQE Exploitation service, which has already been implemented in about 30 of the buildings they manage. A growing number of Group companies have initiated ISO 26000 certification programmes.

Evaluation and environmental certification ISO 14001 2012 

2011 

2010 

Scope/base reference

‌Motorways in service

þ 100 

þ 64 

26 

in number of kilometres

‌Motorways under construction

þ 100 

þ 90 

100 

in number of kilometres

þ 25 

þ 22 

þ 24

France and worldwide

‌Production from quarries owned

þ 58 

þ 65 

þ 62.5

in tonnes

‌Production from coating plants owned

þ 24

þ 30 

39 

in tonnes

‌Production from binder plants owned

þ 83

þ 65 

75 

in tonnes

‌Revenue from the works activity

þ 28

þ 35 

37 

France and worldwide

þ 60 

þ 60 

59 

France and worldwide

(as a percentage) VINCI Autoroutes

France

VINCI Energies Eurovia

France and worldwide

VINCI Construction

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

2.2 2.2.1

Conserving resources Protecting water resources

In answering the CDP Water Disclosure questionnaire for the first time in 2012, VINCI joined the group of 191 companies worldwide that fulfilled the information request. The Group’s water strategy is based on its environmental policy: to include water consumption and pollution prevention in risk analyses, to measure and reduce water consumption resulting from its business activities and products, and to protect water environments and ecosystems. VINCI has created an International Hydraulic Engineering Activity Pivot Club to identify expertise and design new, specific offerings. Group companies monitor water resources particularly carefully. Subsidiaries have adopted a number of specific initiatives to reduce water consumption. Programmes to repair leaking pipes are also being deployed on the entire VINCI Autoroutes network. Of all the VINCI motorways in service, 72% have been equipped with water protection systems, involving either natural protection or structures that address potential problems. The policy for protecting water resources was strengthened by the adoption of the green motorway package in 2010. VINCI plc monitors monthly water consumption on each project with the aim of reducing the volume used. VINCI Construction has introduced a wastewater recycling policy in France. Some 60 concrete mixer washing stations have already been installed on worksites, leading to large reductions in water consumption. Tools developed through the partnership with the Chair in Eco-design enable the water footprint of specific neighbourhoods to be assessed in detail, with particular emphasis given to soil permeability, rainwater harvesting and wastewater treatment. Some subsidiaries are creating specific processes for treating water pollution. Entrepose Contracting has designed Notil, a net used to tow up to 10 tonnes of hydrocarbons in the event of an oil spill. Water management is also essential in the design and construction of eco-neighbourhoods.

Water consumption (cubic metres of water purchased) 2012 

2011 

Scope

VINCI Autoroutes

983,073 

925,250 

ASF, Cofiroute, Escota

VINCI Concessions

150,452

103,093 

Stade de France Consortium, VINCI Park France, VINCI Airports (included for first time in 2012)

VINCI Energies Eurovia VINCI Immobilier and holding cos. Subtotal (excluding VINCI Construction)

327,610

358,040 

All VINCI Energies companies in France and worldwide

1,673,796

2,146,399 

Eurovia France and worldwide

2,064 

2,343 

VINCI Immobilier

þ 3,136,995

þ 3,535,125 

VINCI Construction

3,063,297 

4,892,119 

Total

6,200,292

8,427,244 

91% of VINCI Construction’s business, including all or part of VINCI Construction France, VINCI Construction Grands Projets, Sogea-Satom, Entrepose Contracting, Soletanche Bachy, CFE, Freyssinet, VINCI plc

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

VINCI 2012 Annual Report

Report of the Board of Directors

153

VINCI is gradually increasing the accuracy of its reporting on water consumption, despite the diversity of its activities. The increase in the Concessions business water consumption is due to the expansion of the scope covered. The 22% fall in water consumption at Eurovia and the 37% fall at VINCI Construction are due to the efforts made to decrease consumption. The extent of these reductions is also due to the wide variety of the types of project carried out in the Contracting business from one year to the next. Measuring water consumption remains very complex. By way of an example, earthworks activities use water mainly for hosing down work areas to reduce the amount of dust produced during works. In Africa, water is often pumped from generators installed near villages simply to provide the communities with water. The water itself undergoes no transformation whatsoever. It either evaporates or runs back to the water table without being polluted. Water consumption is measured based on the fuel consumption of generators. Many businesses use water in this way. Responding to the CDP Water Disclosure questionnaire is thus a sign of the maturity of VINCI companies.

2.2.2

Raw materials

In the Contracting business, raw materials purchasing is decentralised, with purchases monitored on a project-by-project basis and not consolidated at Group level. Efforts focus on purchasing recycled materials of equivalent performance, recycling waste (see paragraph 2.2.8) and sourcing local products. There is also a focus on designing products that use fewer raw materials. The Group’s eco-design approach is used by VINCI Construction France for developing housing, offices, student accommodation and other projects. In housing, the Habitat Colonne procedure, used to build about 500 homes in 2012, reduces raw materials consumption by 20%. In the Concessions business, consumption of the main raw materials is monitored and consolidated. In 2012, 1,571,018 tonnes of coating were used and 34,902 tonnes þ of de-icing salt were purchased (48,386 tonnes þ in 2011). The wood-related businesses of VINCI Construction France, under the brand Arbonis, generated revenue of €65 million in 2012, up 62% on 2010. In 2012, to gain a better understanding of the environmental impact of raw materials, VINCI collaborated with professional groups to prepare life cycle inventories (LCI) of its materials. The Group also played an active role in discussions at the French government’s Environmental Conference. Through the partnership with the Chair in Eco-design, post-doctoral research was used to apply European environmental data on the steel and wood used in construction to the construction practices in France based on the Diogen database of civil engineering impact data. As a member of the EcoSD network that promotes expertise in eco-design, VINCI has begun an initiative to compile a French environmental database devoted to the construction sector. VINCI also participates in inter-industry working groups, such as the infrastructure committee of France’s energy, environment and transport observatory (OEET) and the GT41 working group of the French underground tunnel association (AFTES). Soletanche Bachy is contributing to GT41 efforts to develop a life cycle assessment-based methodology for assessing and comparing underground structure building methods, estimating the impact of materials used, making design and construction adjustments and comparing technical solutions.

2.2.3

Energy consumption

In 2012, the Group continued to focus on the actual performance of its activities and offers. The measurement of energy consumption resulting from VINCI’s activities (worksite equipment, vehicles, infrastructure assets under concession, etc.) was audited at Group level by the Statutory Auditors, who expressed a limited level of assurance in the figures. In France, the 2012 thermal regulations form a major part of the Grenelle Environment legislation and seek to encourage low-energy buildings. The regulations came into force in 2011 for some projects (commercial buildings and housing in urban renewal areas). To meet the new requirements while maintaining costs, VINCI is developing new systems in both the commercial and housing sectors, drawing on VINCI Construction’s expertise to minimise energy losses through the building shell and VINCI Energies’ to install innovative equipment such as all air heating. VINCI is playing a part in preparing the future 2020 thermal regulations, which will consider the building sustainability as a whole, and not merely in terms of energy. Current work is focused on building use and the calculation of overall multi-criteria performance. With its Oxygen eco-commitment, VINCI Construction France guarantees the energy performance of both the new and refurbished buildings it delivers and provides ways for occupants to optimise their energy use. In 2012, 18 Oxygen projects were under development. VINCI Facilities (VINCI Energies) is using its expertise in areas such as energy diagnostics and audits, monitoring and optimisation work to develop Diago energy efficiency contract solutions for its clients. These may involve various levels of service, from adjusting an energy supplier contract to performing major energy-related renovation work. In all cases, clients are guaranteed a certain level of energy savings. VINCI Facilities also uses its expertise to improve its own energy performance, monitoring and managing its energy consumption and raising staff awareness about saving energy. In 2012, energy performance was a major topic discussed in lectures given through the Chair in Eco-design, including during the seminar on 2 and 3 October on smart grids, and energy performance guarantee for refurbished buildings.

154

Report of the Board of Directors

Total energy (including natural gas, heavy fuel oil and electricity) consumed by VINCI companies in 2012 Total energy (MWh)

Natural gas (MWh)

421,126

17,914

‌VINCI Autoroutes

253,412

6,113 

139,857 

‌VINCI Concessions

167,714

11,801

150,201

8,373,575

935,181 

772,365

56,069 

‌Eurovia

3,833,364

845,360 

28,726 

357,041 

‌VINCI Construction

3,767,846

33,752 

71,282 

328,821 

Concessions

Contracting ‌VINCI Energies

VINCI Immobilier and holding cos.

Heavy fuel oil (tonnes)

290,058

100,008   

3,791

Total

þ 8,798,492

Electricity (MWh)

953,095

769,495 83,633



1,889 

100,008

1,061,442

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

For the reporting period, Group energy consumption totalled 227 MWh per million of euros of revenue. Due to the industrial nature of its business, Eurovia continues to account for a large proportion of total energy consumption. The increase in activity at its lime plant and the inclusion of VINCI Airports in the reporting scope drove natural gas consumption up about 30% on 2011. DEME (CFE subsidiary specialised in dredging) accounts for most of the heavy fuel oil consumption. Electricity consumption, up 6% on 2011, did not rise as fast as the revenue of businesses covered by environmental reporting. Eurovia was the first Group business line to set up an ambitious energy and CO2 reduction plan, including improvements to the energy efficiency of coating plants, quarry equipment and operations buildings. The Group’s public works subsidiary is also developing processes that reduce energy consumption. For example, the Tempera® warm mix process produces energy savings of 20-40%. Eurovia’s target is to lay warm mix products on 50% of all its roads by 2015. At VINCI Construction, subsidiary Arbonis specialises in wood-related activities. It sells Sylvabox, a range of wood-framed bungalows featuring enhanced insulation that reduces energy consumption by 80%.

Fuel consumption Diesel (*)

Petrol

2012 

2012 

2012 

2011 

Change

10,855,598 

24,642 

10,880,240 

10,807,082 

0.7%

10,308,977 

22,048 

10,331,025 

10,435,783 

(1.0%)

ASF, Cofiroute, Escota

47.9%

VINCI Park in France, Stade de France Consortium, VINCI Airports (included for the first time in 2012)

(in litres) Concessions ‌VINCI Autoroutes

Total Scope and/or explanation for change

546,621 

2,594 

549,215 

371,299 

493,115,561

12,221,020

505,336,581

492,989,719 

2.5%

58,157,334

2,675,740

60,833,074

58,060,188 

4.8%

France and worldwide

‌Eurovia

195,576,661 

3,966,052 

199,542,713 

189,917,759 

5.1%

Increase in business

‌VINCI Construction

239,381,566

5,579,228

244,960,794

245,011,772 

(0.0%)

‌VINCI Concessions Contracting ‌VINCI Energies

VINCI Immobilier and holding cos. Total

182,960 



182,960 

173,400 

5.5%

504,154,119

12,245,662

516,399,781

þ 503,970,201 

2.5%

Increase in business

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report. (*) In 2011, the indicator takes into account diesel and heating oil.

With an increase of 2.5%, the Group’s total fuel consumption rose less than the revenue covered by environmental reporting (up 7%). This progress results from the continued training in eco-driving of passenger vehicles and trucks and eco-operation of heavy equipment in all of its subsidiaries, in particular at VINCI Construction Terrassement and Eurovia, where all heavy equipment operators in quarries have been trained. Vehicles and equipment are also systematically replaced with more economical versions. In addition to in-house training, VINCI Autoroutes encourages customers to reduce their fuel consumption by organising eco-driving awareness campaigns at motorway rest areas and by developing offers that help make the best use of existing infrastructure. VINCI Autoroutes continued to promote car-pooling in 2012. Located near toll stations, parking facilities make an easy meeting point for drivers and passengers, with nearly 1,000 parking spaces reserved for car-pooling in autumn 2012. VINCI Autoroutes also develops dynamic traffic management solutions by boosting the involvement of users on its roads: real-time information systems that help users save fuel, for example when looking for a parking space at a rest area. This topic was extensively developed at VINCI’s 2012 Research Day on 29 February. Through the Chair in Eco-design, research is being carried out into the eco-design of parking facilities. The Ecole des Ponts ParisTech, in partnership with VINCI Park, has modelled the balance between supply and demand for city parking in order to design solutions that minimise the time users spend looking for a space (more than 10% of current city traffic).

2.2.4

Use of renewable energy

In 2012, VINCI companies purchased 4,489 MWh of electricity generated from renewable energy sources (2011: 4,385 MWh). VINCI plc (VINCI Construction) fixed sites in the United Kingdom buy almost all their electricity under renewable energy contracts.

VINCI 2012 Annual Report

Report of the Board of Directors

155

Renewable energy-related activity is expanding. The Contracting business companies have expertise in designing, supplying and installing photovoltaic panels. Sonil, a VINCI Construction France subsidiary, specialises in integrating and installing solar panels. The company has completed 30 projects totalling 7,000 m2 or 900 kWp. VINCI Energies business units also have expertise in building photovoltaic power plants. Omexom Energies Renouvelables specialises in the design, contracting, grid access and operation of renewable energy projects. The company is building the 12 MWp photovoltaic farm in Estezargues in the south of France, which features 10,000 m2 of sensors. VINCI Construction is developing technical solutions to industrialise construction and optimise the installation of onshore and offshore wind farms. This was the focus of the Eolift research project, overseen by Freyssinet and winner of the large-scale wind power call for interest launched by Ademe in 2012. VINCI Autoroutes has 2,697 renewable energy devices (excluding heat pumps) generating solar, thermal and wind energy. As concerns the Group’s vehicle fleet, various subsidiaries are currently testing hybrid and electric alternatives. In 2012, VINCI Facilities (VINCI Energies) introduced a car-sharing solution combining electric and thermal vehicles at its Buc site in the Greater Paris area. VINCI is a member of a group of major companies that has made a commitment to the public authorities to encourage and support the development and mass production of no-carbon vehicles.

2.2.5

2.2.6

2.2.7

Land use

To combat the loss of natural and agricultural resources and to maintain a balance between nature and human amenities, the Group deals with land-use issues at a very early stage. Efforts include research into biodiversity and urban agriculture as part of the Chair in the Eco-design of Building Complexes and Infrastructure. Integrating sites into their environment and land use are subjects of special concern for motorway concessions and for Eurovia’s quarries. These entities have acquired special expertise in rehabilitation. This enables them to restore the biodiversity of sites and make them an integral part of the local environment. For all infrastructure projects, and particularly for the Tours–Bordeaux South Europe Atlantic high-speed line project in 2012, the Group worked with local communities and made commitments to the French government. The companies have appointed experts in landscaping and reliefs.

Air pollution

The VINCI business lines most concerned with the problem of atmospheric emissions are VINCI Concessions, Eurovia and VINCI Construction. In Concessions, atmospheric emissions were monitored at a sample of 272 VINCI Park, VINCI Airports and VINCI Autoroutes car parks. This revealed that most emissions are generated by users (cars, aircraft, etc.).

Noise pollution

All VINCI projects are subject to a preliminary noise study to limit the noise generated by urban construction sites, motorway traffic and so forth. Soletanche Freyssinet subsidiary Soldata specialises in noise management. In 2012, it deployed EAR-is, its software that analyses noise and vibration levels in real time and simulates them for construction projects and industrial activities. VINCI companies systematically offer technical solutions during the construction phase, including changing a motorway route, erecting noise barriers and embankments, and using special low-noise road surfacing materials such as Eurovia’s Viaphone®. Noise levels on motorways in France are measured regularly to enable VINCI’s motorway concession companies to identify and reduce noise black spots. Homes may then be protected using noise insulation in their facades, or noise barriers or embankments planted with shrubs or trees. As part of the green motorway package, VINCI Autoroutes has committed to providing noise protection to 1,000 homes identified as noise black spots between 2010 and 2012. In 2012, 662 homes þ were protected, making a total of 1,141 since 2010. Studies and administrative work were conducted in 2010, with most of the noise-prevention work carried out in 2011 and 2012.

2.2.8

Waste management and recycling

VINCI’s general policy is based on a circular economy model and focuses on three aims: producing less waste at the source; waste sorting and traceability; and recovering waste to use as a resource. This policy is closely associated with the eco-design strategy used in VINCI’s products and services. Waste management is important to both Contracting entities – which deal mainly with construction site waste – and Concessions entities, which have to dispose of their customers’ waste (car parks, motorways, etc.). The Group’s Contracting companies implement waste management plans at their worksites in accordance with local requirements. In the UK, VINCI companies have joined the national effort to halve the quantity of landfilled waste between 2005 and 2012. In 2012, VINCI plc produced 1,251,146 tonnes þ of waste, of which over 98% þ was recycled, reused or recovered, a significant improvement on 2011 (up 80%þ). VINCI Energies business units also monitor their waste closely, including paper waste, which totalled 1,057 tonnes in 2011. In 2012, these business units produced 172,078 tonnes of inert waste, 13,501 tonnes of non-hazardous waste and 672 tonnes of hazardous waste. Recycling has been a priority at Eurovia for some 20 years and there is a veritable boom in the development of innovative products and processes that use smaller amounts of natural resources and energy. Eurovia now has 130 facilities that recycle most of the waste produced by its worksites. In 2012, Eurovia set itself the target of exceeding 20% of recycled mix aggregate in its total amount of mix. The percentage is being checked by the Statutory Auditors and has increased by 12.5% over 2011, making Eurovia Europe’s market leader in this field.

156

Report of the Board of Directors

Waste recycling and recovery at Eurovia 2012 

2012 

2011 

2011 

France

2012/2011 change

World

France

13.1 

26%

þ 12.3 

10.4 

10%

6.5

3%

7.7 

6.3 

3%

11.0

(26%)

9.6 

14.9 

World

2012/2011 change

þ 12.5

2%

Production of recycled material (in millions of tonnes)

8.5

Total recycled material as a percentage of total aggregate production

9.9

Percentage of mix manufactured with recycled mix aggregate

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

As part of the green motorway package, 91% of the rest areas along VINCI Autoroutes motorways are equipped with sorting bins (39% in 2011 and 21% in 2010). VINCI Autoroutes also runs regular awareness campaigns to encourage motorway users to sort their waste. Once sorted, waste is delivered to recovery and treatment facilities; 52% of the waste produced by VINCI Autoroutes was recovered in 2012.

Waste sorted and collected on VINCI Autoroutes motorwaysw (tonnes) Non-hazardous waste (customers + operations) Hazardous waste (customers + operations) Rest areas equipped for waste sorting

2012 

2011 

þ 13,414 

þ 12,745

þ 2,158

þ 572 

91%

39%

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

2.3

2.3.1

Combating climate change

Greenhouse gas emissions must be reduced in order to combat climate disruption. In 2007, VINCI initiated a proactive programme on this subject to anticipate, monitor and comply with legislation in the most advanced countries. The impact of current carbon emissions regulations on VINCI’s activities is mainly indirect. VINCI has only one facility that is subject to the European emissions trading scheme’s National Allocation Plan (see page 124) and must comply with the Carbon Reduction Commitment in the United Kingdom. VINCI Autoroutes has undertaken a study of how carbon reduction measures affect its activities. New regulations are opening up opportunities for VINCI, whose companies now offer their customers climate-friendly solutions that enable them to reduce their own greenhouse gas emissions. VINCI committed to green growth in 2012, with a target to reduce greenhouse gas emissions by 30% by 2020. This target covers the Group’s like-for-like CO2 emissions and uses 2009 as its base year (the first year when coverage exceeded 90%). The Group is also taking initiatives to reduce its clients’ energy consumption.

Greenhouse gas emissions

The methodology used to determine the greenhouse gas emissions of VINCI’s businesses is based on the Group’s environmental reporting data and measures ISO 14064 Scope 1 and 2 emissions. Scope 1 includes direct emissions from the use of fossil fuels (fixed sites, worksites and company vehicles), as well as non-energy emissions (mainly from decarbonising limestone at Eurovia’s lime plant). Scope 2 includes indirect emissions produced to make energy (mainly electricity) purchased and used at fixed sites and for projects. Overall, VINCI’s CO2 emissions in 2012 amounted to 2.4 million tonnes. In 2012, 32 VINCI subsidiaries applied Article 75 of the Grenelle II Environment Law, which requires companies to perform greenhouse gas audits and define action plans to reduce them. The Group’s emissions are determined using regulatory coefficients from the carbon database of Ademe (France’s environment and energy management agency). The coefficients were applied to data from previous years and recalculated for a pro forma comparison.

Greenhouse gas emissions (Scopes 1 and 2)

Concessions

Tonnes of CO2 equivalent

Tonnes of CO2 equivalent

2012 

2011 

2012/2011 change

52,975

46,198

‌VINCI Autoroutes

37,243 

36,632

1.7%

‌VINCI Concessions

15,732

9,566

64.5%

Contracting

14.7%

2,335,503 

2,217,564 

186,937

181,543

3.0%

‌Eurovia

1,126,463 

998,633

12.8%

‌VINCI Construction

1,022,102

1,037,388

(1.5%)

605 

600

0.9%

þ 2,389,083 

2,264,361

62 

62 

‌VINCI Energies

VINCI Immobilier and holding cos. Total Carbon intensity (tonnes of CO2 equivalent per million euros of revenue

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report. Data extrapolated to cover 100% of VINCI’s revenue. 2011 data corrected to take into account the calculation method in Article 75 of France’s Grenelle II law.

5.3%

VINCI 2012 Annual Report

157

Report of the Board of Directors

In 2012, the Group’s direct emissions (Scope 1 and 2) per million euros of revenue were stable in relation to 2011 at 62 tonnes of CO2 eq. VINCI’s carbon intensity has continued to decrease since 2009 (71 tonnes of CO2 eq.) to stand at 13.3%. Group companies have introduced ambitious policies to achieve the greenhouse gas emissions target by 2020. Eurovia’s 2012-2015 policy aims to reduce its CO2 emissions by 4% per year. In the UK, VINCI Construction has set a target to reduce emissions by 30% between now and 2015. To broaden its range of low-CO2 solutions, VINCI is continuing to develop specific tools and carry out studies to better quantify and control greenhouse gas emissions resulting from its business (ISO Scope 1, 2 and 3). Other levers for reducing greenhouse gas emissions are mainly to be found in how structures are used by clients and end-users: operation accounts for over 50% of lifetime emissions for a rail line, 90% for a building and over 95% for a motorway. Reducing the CO2 emissions of VINCI structures is part of an eco-design approach that takes into account the construction, operation and end-of-life phases to compare and select the most appropriate technologies during the design phase. The approach uses life cycle assessment (LCA) tools which, as well as CO2 emissions, measure indicators such as water consumption, depletion of natural resources and impacts on human health. These tools allow the Group to ensure that CO2 reductions do not result in other impacts at any point in the life cycle of its structures. LCA tools are developed within the framework of the Chair in Eco-design and are used in numerous subsidiaries. At VINCI Construction France and Soletanche Bachy, eco-design studies were carried out on 229 projects in 2012. Eurovia also carries out LCA on its new materials. The CO2NCERNED methodology developed by VINCI to measure a project’s carbon footprint is deployed across all Group business lines: to assess construction options at VINCI Construction, the effectiveness of solutions at VINCI Energies and motorway routes at VINCI Concessions. Since 2012, it is also used to optimise the carbon footprint of rail infrastructure. VINCI is an active member of national and international working groups within its industry (Association Bilan Carbone and Encord) that are defining standards for quantifying Scope 3 emissions. Under this approach, success depends on relationships with end-customers, which is why VINCI Autoroutes encourages motorists to drive less aggressively and to use the eco-comparison tool on its website to calculate the amount of CO2 they could avoid emitting. VINCI Construction shows building occupants how they can consume less energy through its Oxygen eco-commitment (23 projects considered in 2012, 18 under way). The first Oxygen building delivered was the Ensta campus at the Ecole Polytechnique site in Palaiseau. Its solution, which combines geothermal energy and solar panels, has reduced site emissions by 90% compared with a traditional natural gas system. VINCI Facilities (a VINCI Energies subsidiary) provides customers with innovative solutions for drastically reducing the carbon emissions of the buildings it manages.

CO2 emissions of VINCI Autoroutes companies (tonnes of CO2 equivalent) ISO Scope 1 and 2 emissions Motorway user emissions

2012 

2011 

þ 37,243 

36,632 

þ 12,628,504 

13,033,349

þ Data checked by the Statutory Auditors; for the 2012 data, see page 177 of the 2012 Annual Report and for the 2011 data, see page 159 of the 2011 Annual Report.

Between 2011 and 2012, the CO2 emissions of VINCI Autoroutes companies rose 1.7% to around 37,000 tonnes with the inclusion of the A86 Duplex in the environmental reporting scope. Emissions by motorway customers fell 2.3% due to a decrease in heavy vehicle traffic and the deployment of 30 km/h electronic toll lanes. These no-stop lanes have lowered CO2 emissions by 41,980 tonnes since 2011. Investors have responded positively to the measurement of greenhouse gas emissions and actions taken to reduce them. In 2012, for the sixth year running, VINCI confirmed its leadership position in France regarding climate strategy by obtaining the Carbon Disclosure Project’s highest rating (80/100, level C) among its peers in the construction and public works category. The Carbon Disclosure Project, which is conducted on behalf of 655 investors, assesses how the world’s 500 largest companies by market capitalisation are responding to climate change.

2.3.2

Adapting to climate change

VINCI has adopted France’s plan for adjusting to climate change and takes a forward-looking approach to the issue. The Group plans in advance for any necessary changes to cities and buildings, particularly in eco-design projects in which studies span the structure’s whole life cycle. Similarly, VINCI companies have taken into account the scientific data predicting a 50 cm rise in sea levels by 2050. Although they cannot take action regarding political strategy on receding coastlines, they are developing expertise in technical improvements, notably to strengthen barriers. VINCI plays a central role in making new and existing structures more resistant to extreme weather events, ensuring long-term durability and providing innovative construction solutions. It carries out extensive research, both internally and through its partnership with the Chair in the Eco-design of Building Complexes and Infrastructure. In response to the scarce funding available to public clients and the uncertainty about new financing partnership models, VINCI Concessions supports the Economics Chair of Public-Private Partnerships to develop knowledge in these areas.

2.4 2.4.1

Conserving biodiversity VINCI’s approach to biodiversity

VINCI strengthened its biodiversity strategy substantially in 2012, turning its biodiversity working group into a Biodiversity Task Force. The 15-strong team combines the Group’s ecology experts with the environment managers from its different activities and is primarily responsible for monitoring the regulatory environment, developing scientific expertise, analysing risks, promoting initiatives and sharing best practices. The unit also encourages organisations, engineering and design departments, and companies to discuss their approaches and tools. These insightful exchanges are held under the banner of the “working together” programme.

158

Report of the Board of Directors

The Group drew on the expertise of the Biodiversity Task Force in its response to the call for recognition from the Ministry of Ecology, Sustainable Development and Energy by joining the Stratégie Nationale pour la Biodiversité (SNB, national biodiversity strategy). VINCI’s proactive commitment to promoting biodiversity was officially recognised in late 2012. The SNB’s recognition acts as a guarantee of the quality and consistency of its 2012-2015 biodiversity programme, which entails Group-wide initiatives designed to: ˇˇ pool and build knowledge on biodiversity; ˇˇ share best practices; ˇˇ train and raise the awareness of all staff members about biodiversity; ˇˇ develop new solutions to better integrate biodiversity issues in all aspects of day-to-day work. Eurovia also received SNB recognition for its proactive commitment, which includes a three-year partnership with the Natural Heritage department of MNHN, France’s National Museum of Natural History. The MNHN will guide Eurovia in the implementation and supervision of its SNB project: evaluation and monitoring of the general action plan, assessment and audits of specific sites, definition of biodiversity indicators, training and awareness. In exchange, Eurovia will provide its partner with sites for study in order to develop its knowledge on biodiversity (inventory, comparative analyses of changing environments, monitoring of the performance of structures and ecological redevelopment, etc.).

2.4.2

Measures taken to promote biodiversity

Several Group companies operating on long cycles and directly impacting natural environments – notably those involved in the concessionconstruction of transport infrastructure (motorways, airports), earthworks and quarries – have been looking at the issue of biodiversity for many years. Measures to avoid and reduce impacts on natural environments and to offset residual effects have been developed and applied in partnership with the stakeholders most affected, depending on the project, location, species and ecosystem. Motorway concession operators are primarily concerned with the fragmentation of natural habitats, essentially focusing their efforts on the transparency of infrastructure, the reversibility of barriers and the restoration of ecological connectivity. This includes creating environmental engineering structures, re-profiling ponds, making improvements to hydraulic structures, restoring and enhancing sites of ecological interest, redeveloping slopes, sustainable roadside grass mowing, and so on. One of the emblematic accomplishments in 2012 was the construction of two bat bridges on the A89 worksite in partnership with the Rhône-Alpes federation of organisations for the protection of nature (Frapna). These structures allow bats to use echolocation to navigate over the motorway without the risk of collision. Other initiatives have been taken such as combating invasive species, reducing the use of plant protection products and raising public awareness at rest areas.

Wildlife crossings and roadside fencing on the motorways of VINCI Autoroutes companies (tonnes of CO2 equivalent) Crossings for small and large wildlife (in number) Wildlife roadside fencing (in km)

2012 

2011 

686 

658 

8,721 

8,687 

Along with the initiatives led by VINCI Autoroutes companies, 120 measures have been taken in application of the biodiversity guidelines in the green motorway package. Once the points of conflict between natural ecological connectivity and motorway infrastructure had been identified, the programme enabled a number of improvements to be made: ˇˇ construction of environment-friendly crossings for large animals, underpasses for smaller wildlife, escape areas for wild boar and ramps for deer and similar species; ˇˇ biodiversity management plans implemented at sites of ecological interest near motorways; ˇˇ creation of protective and community-based orchards and olive groves, etc. The main issue faced by Eurovia is restoring sites throughout the life cycle of its quarries, notably in order to conserve and provide a favourable environment for new plant and animal species. The company defines and monitors its measures with the help of local environmental organisations. In France, some Eurovia sites have signed formal partnership agreements with these organisations and 72% of its quarries have joined the UNICEM Environment Charter. In our construction activities and particularly during the earthworks phases, protecting biodiversity at worksites is a highly relevant issue. For example, in 2012 special “biodiversity” signs were put up at 127 VINCI Construction Terrassement worksites. At the South Europe Atlantic high-speed rail line worksite, 650 signs and 1,750 pictograms are being installed. Emphasis is also placed on ecological engineering, focusing on in-house training and the sharing of best practices. Lastly, conservation and improvement efforts are being made to protect and enhance natural assets along the entire South Europe Atlantic high-speed line (SEA). To that end, VINCI set up the LISEA Biodiversity Foundation at the end of 2012. With €5 million funding for the period 2012-2017, the foundation will help to finance local projects submitted by non-profit organisations, companies or research centres located in any of the six French départements crossed by the rail line: Indre et Loire, Vienne, Deux Sèvres, Charente, Charente Maritime and Gironde. To be eligible for financial assistance, projects must aim to: ˇˇ conserve species and strengthen populations; ˇˇ develop knowledge about species (population, habitat, behaviour); ˇˇ restore habitats or ecological connectivity; ˇˇ assess current conservation practices; ˇˇ train players (scientific expertise, methodology, organisation); ˇˇ promote the results of research and studies among the general public. Priority is given to projects that conserve the European mink, foster the recolonisation of little bustards on farmland and develop knowledge about bats. The initiatives supported are set apart from the commitments already made by LISEA, COSEA and RFF, and are not included in the SEA project’s regulatory and ecological offsetting measures.

VINCI 2012 Annual Report

2.5 2.5.1

2.5.2

159

Report of the Board of Directors

Preservation and restoration Legal and regulatory compliance

As regards France’s Grenelle II Environment Law, VINCI has a proactive approach to legal compliance. Special IT tools for managing regulatory and QHSE risks are also used, such as VINCI Energies’ Préventéo®, which supports regulatory monitoring and the standardisation of criteria for the Group’s regulatory audit. The Group pools this expertise and environmental regulation monitoring efforts through cross-business working groups.

Prevention of environmental impacts and associated costs

Expenditure on protecting the environment (e.g. soil remediation at Soletanche Bachy, cleaning and decontamination of structures at Freyssinet and recovery of organic materials at VINCI Environnement) is generally included directly in each project’s operating expenses and is not consolidated centrally. Between 2011 and 2012, the annual environmental expenditure of VINCI Autoroutes rose by 20%. This four-fold increase since 2010 is due mainly to the implementation of the green motorway package.

Environment-related expenditure by VINCI Autoroutes companies (in € millions) Annual environmental investment Annual spend on the upkeep of natural areas Insurance premiums to cover environmental risks

2.5.3

2012 

2011 

312 

260 

2010  83 

31 

32 

30 

0.32 

0.32 

0.34 

Environment provisions and guarantees

See “Environmental, industrial and technological risks”: page 120 of the Report of the Board of Directors.

2.5.4 Damages paid in 2012 following legal decisions on environmental matters and lawsuits filed for damage to the environment

Legal decisions regarding the environment are handled directly by the business units concerned and the amounts paid are not consolidated at Group level. No VINCI companies appear to have paid any damages in 2012 subsequent to a court decision on an environmental matter.

3.

Social responsibility This chapter contains information about VINCI’s social responsibility commitments. VINCI’s social responsibility policy takes the form of various actions and programmes: the Group’s impact on the areas where it operates, its relations with stakeholders, and sponsorship. As regards sponsorship, VINCI’s companies focus on three main areas: employment and social integration through work, environment and research, and culture and heritage assets. In accordance with the Group’s decentralised management model, VINCI does not consolidate either its reporting on sponsorship actions or the total budget allocated. A low-range estimate suggest a total amount of about €10 million in 2012.

3.1

Regional, economic and workforce-related impacts of VINCI’s activities See also page 24 of this annual report Manifesto commitment number 4: “Engage in civic projects together”

All jobs created by Group companies, whether directly or indirectly through temporary employment and subcontracting, together with initiatives undertaken to encourage the professional integration of people who have been unemployed for a long period, help to support regional development. In addition, public-private partnership agreements for the financing and operation of certain types of infrastructure over the medium and long term contribute to building strong and lasting relationships with local authorities. The Group’s preferred governance approach, applied increasingly year on year for all major projects having a potential impact on the environment and quality of life for local communities, involves consultation with residents and environmental organisations.

3.1.1

Contribution to employment, local skills development and professional integration

Employment and skills development VINCI’s Contracting activities (the Energy, Construction and Roads business lines) are highly labour intensive and thus have a substantial direct and indirect impact on regional employment (see § 1.2 Employment). The Group’s general policy is to use local resources whenever possible. Internationally, and particularly in emerging economies, VINCI works to promote the development of local skills for both production and managerial staff. In Africa, for example, Sogea-Satom has undertaken a long-term commitment to the professional development of African managers, enabling them to move into senior positions. With this aim in view, the company is supporting the development of local training structures and continues to strengthen its partnerships with the Ecole Polytechnique de Dakar in Senegal, the Institut Supérieur de Technologies d’Afrique Centrale (ISTAC) in Cameroon and the Institut International d’Ingénierie de l’Eau et de l’Environnement (2IE) in Burkina Faso. In 2012, Sogea-Satom confirmed the hiring of 11 recent graduates selected by the company as beneficiaries of special support measures throughout their studies. It has lent similar assistance to a total of 19 students since the start of the 2012–13 academic year. Under this initiative, some 50 young people have been subsidised by the company since its first partnership was launched in 2007 and 47 have been hired. Currently, 50% of works engineers and works directors employed by Sogea-Satom are African. VINCI Construction Grands Projets has launched Skill Up, a programme that seeks to build the knowledge and competencies of workers and supervisors around the world by establishing local training centres close to the entity’s worksites. In 2012, 343 employees in Turkmenistan,

160

Report of the Board of Directors

Qatar, Malaysia and Chile received training under the Skill Up programme. Of these, 60% had been hired directly at local level, with subcontractors accounting for the remainder. For its Papua New Guinea pipeline project, Spiecapag, an Entrepose Contracting company (VINCI Construction), has hired 3,600 people since work began in 2010, 74% of whom are New Guineans. Special training programmes have been put in place for these new hires. Since the launch of the project, 94,196 training hours have been delivered, with local trainees accounting for 69% of session participants. In France, favouring local employment whenever possible and local skills development are key aspects of the Group’s policies. For the South Europe Atlantic high-speed rail line between Tours and Bordeaux (SEA HSL), the construction joint venture COSEA has entered into a partnership with stakeholders in the Poitou Charentes region, the French state, regional authorities, state-run job centres, chambers of commerce and trade associations. A charter has been signed by all these parties formally recognising the project’s commitment to local employment, sustainable employability, secure career paths and the reinforcement of local know-how. Between the launch of the project and year-end 2012, close to 1,000 people had been hired locally, two-thirds of whom were people excluded from the labour market (i.e. among those targeted by professional integration measures). The recruiters also focused on opening up these business activities to women, who made up 10% of the machine operators trained in 2012. To serve local hires, nine training structures have been established along the route of the future rail line (four specialising in civil engineering and five in earthworks), with the aim of gaining a lasting foothold in the region, which is necessary to ensure the long-term viability of this initiative. Professional integration Since its creation, VINCI and its subsidiaries have worked to develop a number of initiatives to fight social exclusion and help the long-term unemployed and other disadvantaged people find jobs. In 2012, Xavier Huillard, chairman and CEO of VINCI, signed the Pacte pour l’Insertion et l’Emploi launched by the Comité National des Entreprises d’Insertion (CNEI), thereby reaffirming the Group’s formal commitments in this area. The aim of this initiative is to encourage all stakeholders to support the development of companies established specifically to promote social integration, taking as its goals a threefold increase in the number of people served by social integration structures and bring populations back into the workforce over the long term. The development of the ViE social integration entity continued in 2012. Launched in 2011 at the initiative of the Group’s Executive Management, this new subsidiary provides innovative and effective solutions to Group companies that want to address the workforce-related demands stipulated in the social integration clauses of their contracts. Unprecedented in France, this structure aims to support long-term social integration by providing assistance to Group companies on a day-to-day basis. Another role is to establish professional relations with socially responsible entities appointed by public authorities as their preferred contacts regarding social integration, and advising local government authorities about new services that meet business needs. In addition to serving Group companies, ViE adopts a cohesive approach to getting socially excluded individuals squarely on the path to career development, organised around social integration through work, access to training and consideration of social issues faced by these populations, all the while helping them find permanent jobs. The ViE structure is targeting controlled growth, with a gradual ramp-up of facilities throughout France. In 2012, ViE’s offices in the Paris region and northern France gained a firm footing while a new office was created in the south-western part of the country. For companies located outside these three regions, ViE offers its assistance on an ad hoc basis. In 2012, the first full year of operation for the entity, Group companies enlisted ViE’s services for the administration and coordination of social integration in relation to 87 projects, corresponding to 1,350,000 hours of integration employment and involving more than 1,200 subcontractors. In all, 710 people benefited from social integration measures in 2012, including 12% women and 2.8% workers with disabilities, corresponding to 343,000 hours of integration employment. ViE also assists Group companies with voluntary integration measures involving clauses added to supply contracts signed with service providers. Along these lines, in 2012, Escota became the first VINCI company to include an integration clause in one of its ongoing maintenance contracts, requiring at least 5% of labour hours for brushwood clearing and tree felling to be performed by long-term unemployed individuals. ViE’s integration coordinators participated in some 200 meetings with social and solidarity economy stakeholders and government officials in order to cooperate more effectively and improve the linkages between the various integration measures implemented throughout France. Relations with educational institutions VINCI companies have consistently recruited new staff for a number of years, even under challenging economic conditions, and maintain long-term partnerships with educational institutions and in the education field. The general policy is to enable all Group companies to rely on VINCI’s strong employer brand for their recruitment needs, whether in terms of volume or quality. A large number of partnerships are forged locally by Group companies with apprenticeship centres, schools, universities and other institutions of higher learning. They involve the allocation of the apprenticeship tax, supplemented by the strong involvement of employees in educational initiatives. Apart from the usual short- and medium-term recruitment campaigns, specific efforts targeting young people are also pursued well in advance of recruitment, designed to introduce them to the Group’s professions and help them discover career opportunities. In France, VINCI is an active partner of the Capital Filles programme, bringing together six corporations and three government departments, whose aim is to assist young women from low-income backgrounds with their career plans. In 2012, 65 women employed by the Group volunteered their time to visit secondary schools in disadvantaged urban areas across France to speak about technical occupations within VINCI companies and mentor young female students. The Group also takes part in Ma Caméra chez les Pros, an introduction to VINCI professions geared towards middle school students. In addition, VINCI actively supports “second chance” schools in France, serving educationally disadvantaged populations tending to be excluded from the labour market. The initial five-year cycle of the first Chair in Eco-design of Building Complexes and Infrastructure, sponsored by VINCI in conjunction with three prestigious ParisTech institutions (MinesParisTech, AgroParisTech and the Ecole des Ponts ParisTech), draws to a close at the end of 2013. The partnership, which has amounted to €600,000 a year, will be renewed, with further research, publications, classes and seminars as well as practical real-world applications planned for the next cycle, which will run from 2013 until 2017. Fabrique de la Cité, another recipient of VINCI’s support, is a think tank dealing with urban issues, bringing together scientists, people from the corporate world and public-sector decision-makers. It develops partnerships with schools and universities. Examples include the AMUR (urban development and programme management) master’s degree offered by Ecole Nationale des Ponts et Chaussées (ENPC France) and the master’s degree in regional and urban development strategies offered by Sciences Po-Paris. It also has a partnership with Institut d’Urbanisme de Grenoble (IUG).

VINCI 2012 Annual Report

3.1.2

Report of the Board of Directors

161

Contribution to regional development and impact on local populations

By designing, financing, building and operating bridges, tunnels, roads and other infrastructure over the long term, all VINCI companies are leading players in regional development, whether in rural or urban areas. As the Group’s activities cannot be relocated, they give shape to the space where they are pursued, endowing it with greater coherence and fostering both economic and social development. Through their strong local roots, Group companies generate significant economic benefits, playing an important part in the life of surrounding communities, as much through construction as through concession activities, whether in the form of revenue, local tax contributions or support for local nonprofits organisations and associations The Group’s Cité Solidaire programme, for example, in collaboration with Group companies, supports very small non-profit organisations working on community projects in underprivileged neighbourhoods. This programme invites proposals focusing on disadvantaged urban areas, supports small neighbourhood associations that act locally, and promotes commitments by Group companies at local level to sponsor projects and offer communities the benefit of their employees’ expertise. Following two pilot projects in 2010, the effectiveness of this approach was confirmed in 2011 in three French cities. In 2012, the programme was extended to four new cities in France: Grenoble, Le Havre, Rennes and Champigny sur Marne. The Group’s concession companies are gradually putting in place means of assessing the economic activity and social impacts generated by the operation of major engineering structures. As an example of this type of initiative, the Group sponsored two studies analysing the socioeconomic impact of the Rion–Antirion bridge in Greece carried out by researchers at the University of Patras; the first study covered the investment and construction period (1997–2004) and the other covered the operation of this facility between 2004 and 2006. These two studies found that there was a 3% increase in the number of jobs, an initial 25% increase in traffic followed by a 13% increase, a 30% jump in property prices in the northern region during the first period and a 10% rise in the number of companies setting up operations in the region during the second period. The second study also concluded that the bridge has had a positive impact on accessibility in the adjoining regions and has helped reduce economic disparities, while also limiting social exclusion in the areas to the north of the bridge and furthering the development of trans-European transport. In another example, LISEA, the concession company for the future Tours–Bordeaux high-speed rail line (SEA HSL), established an economic think tank in September 2012. The role of this scientific body over the next 15 years is to measure, analyse and publish reports on the impact of the future high-speed line on employment, local economies and the development of regions along its route.

3.2 Relations with civil society stakeholders: non-profit organisations, local residents, users and consumers 3.2.1

Conditions for dialogue with stakeholders

By their very nature, the activities of VINCI companies interact with communities and their residents during both the construction and operation phases. Although public authorities are responsible for decisions on transport and energy infrastructure, as well as facilities to improve the living environment, including where they are to be located, VINCI companies increasingly serve as a liaison with local communities, residents living in proximity to the structures they build, non-profit organisations and users. In general, the companies perceive consultation and dialogue with a project’s stakeholders as a means to create value. To provide a clear framework for this approach, VINCI is developing a specific methodology and associated guidance tools. The need for this type of framework has become apparent since, although VINCI’s Contracting business requires consultation processes to guarantee the best result for all stakeholders during the works and project phases (public survey, safety of nearby residents and the wider local community, worksite hours and schedules, etc.), its Concessions business involves these same processes over extended periods, sometimes as long as several decades. Furthermore, it is important to distinguish between countries that already have a consultation framework – whether the one in place is satisfactory or in need of revision – from those that want to set one in place. Given this range of working environments, VINCI has adopted the simple Reflex tool to fully involve partners in every aspect of a project, including its management. The tool has been tested using operational examples and is based in particular on VINCI Autoroutes’ experience. The first phase of this methodology involves mapping project stakeholders with three goals in mind: identifying their actual, felt and expressed needs with reference to solid material evidence; building structured and measurable solutions to address these needs; and directly involving stakeholders in project management. For example, in France, the design and construction of the last section of the A89 motorway between Balbigny and La Tour de Salvagny placed a priority on dialogue and consultation with stakeholders – including administrative authorities, elected officials, local residents, farmers, environmental protection, hiking associations, and angling and wildlife federations – throughout the entire project. An environment committee was formed, bringing together local environmental protection associations and engineers from ASF (VINCI Autoroutes), which met regularly. This experience sharing resulted in the drafting of an environmental charter including a complete set of measures. More than 2,000 employees, i.e. the full complement of staff working on the project, participated in sessions covering the importance of protecting the environment, including practical guidelines, offered by nature conservation associations as well as angling and wildlife federations. The project for the future Tours–Bordeaux SEA HSL project in France is another example of VINCI’s efforts in this area. More than 100 public meetings were held in 2012, which allowed the expectations of the various stakeholders to be identified and taken into account in the form of design adjustments. Three working groups were established, bringing together local non-profit organisations and farmers, residents, chambers of commerce, other trade associations and regional authorities. Through their participation in these working groups, all stakeholders contributed to the development of the method for implementing the offset measures, giving rise to a charter approved by everyone in 2012. Since it went live in November 2011, the project’s website has logged more than 90,000 unique visitors, with an average of 1,000 each day. Through this interface, more than 1,000 people have subscribed to LISEA’s newsletter. VINCI Airports is taking part in the hearings of the agricultural, scientific and general public debate commissions set up at the end of 2012 by the French government to examine the future Grand Ouest airport project for western France. The agricultural commission is tasked with identifying locally the means of minimising the project’s impact on agricultural land and helping develop effective tools to combat rural space being swallowed up by urban development. In addition to the elements supplied by stakeholders affected by the transfer of the airport, the VINCI Airports subsidiary Aéroport du Grand Ouest has provided all elements useful to writing the reports awaited by each of the commissions. The preparatory work for building the airport (displacement of networks, archaeological assessments, displacement of protected species)

162

Report of the Board of Directors

will start, subject to receiving authorisations from the prefecture in regard to protected species and the Water Act. It should be noted that only 537 hectares will be developed to bring the airport into service, of which 147 hectares will have artificial surfaces (runways, terminals, tarmac, etc.). Over half of the land under concession will be conserved for use in its natural state and for agricultural purposes. In Canada, DJL, Eurovia’s Quebec-based subsidiary, has invested about €90,000 to create a buffer zone around the Mont Saint Bruno national park, thus conserving biodiversity in an urban setting in order to recover the woodland balance in Montreal’s greater metropolitan area. In Russia, for the design and construction of the Moscow–St Petersburg motorway, VINCI Concessions has put in place an innovative tool to mediate conflicts with local residents relating to the environment. Following a period of heated discussions about the project’s impact on Khimki Forest, which had raised concerns among environmental non-profit organisations, VINCI Concessions enlisted the services of a mediating body, the non-profit organisation Pur Projet, which specialises in resolving issues relating to reforestation. Pur Project engaged in dialogue with all stakeholders through a broad process of discussion and consultation with local residents, environmental non-profits, administrative authorities and municipalities. This mediation resulted in the joint development of a programme to conserve and improve the ecosystem of the forest in the path of the motorway. These actions were then incorporated in the environmental and social action plan established by NWCC, the consortium in charge of the project, validated by the concession grantor and the Russian authorities and financed by NWCC and its shareholders (which include VINCI Concessions). The first concrete actions on the ground have been launched in response to the concerns expressed by the local community and non-profits: educational programmes in schools, studies to expand knowledge about areas of passage used by wild animals, restoration of the sacred spring water source, etc.

3.2.2

Actions and sponsorship to combat exclusion and reinforce relations with social integration organisations

VINCI encourages Group companies and their employees to take part in the fight against social exclusion. Many companies are spearheading actions at local level in the regions where they operate. Most of these actions relate to the fight against social exclusion, both on behalf of employees lacking job security and in support of communities where businesses are located. VINCI set up a corporate foundation in 2002 called the Fondation VINCI pour la Cité, which funds sustainable projects that promote ties across social groups and help people excluded from the labour market to find work by providing financial assistance to non-profit organisations, combined with volunteer efforts by Group employees, who use their professional skills to aid those in need. In 2012, the Fondation VINCI pour la Cité backed 196 projects in France, for a total of €2,546,000. Contributions from Group companies totalled €323,994 and those of external partners amounted to €76,000, while 277 employees assisted the beneficiary organisations. In line with VINCI’s commitment to encourage employee participation in such actions worldwide, the Group continues to expand the international reach of assistance provided by its foundations in the context of an initiative launched in 2007. Following the creation of structures similar to the Fondation VINCI in the Czech Republic (2008), Germany (2010) and Greece (2011), two new foundations were set up in 2012, one in Belgium and the other in Slovakia. For greater effectiveness, each foundation tailors its actions and its selection criteria to the socioeconomic context in which it provides support. In all, 86 projects have been backed to date outside France via these foundations since their inception, for a total amount of €964,212. Organic market gardens to promote social integration. The Fondation VINCI pour la Cité supports the creation of organic market gardens along motorways to promote social integration in partnership with Réseau Cocagne. On previously unused land close to service areas on VINCI Autoroutes motorways, four market gardens are producing organically grown vegetables, providing work for people excluded from the labour market. Emmaüs Défi. The Fondation VINCI pour la Cité has lent its support to Emmaüs Défi for the opening of the largest social integration employment centre in the Paris region for the recycling and resale of clothing, furniture and household goods. Working alongside the Foundation, five companies from the Energy business line contributed their expertise and carried out part of the electricity installation for the centre. This skills-based corporate patronage initiative involved a total of 4,000 hours of labour at the Parisian centre, which opened to the public in June 2012. Fond de Dotation Sillon Solidaire. Created in 2012 in connection with the construction and operation of the high-speed rail line between Tours and Bordeaux, this fund is backed by the Fondation VINCI pour la Cité and by all companies participating in LISEA and the COSEA joint venture. Sillon Solidaire aims to support projects undertaken by non-profit organisations that contribute to the fight against social exclusion in regions crossed by the new high-speed rail line: relocation services, housing assistance and educational support for school-age children. Sillon Solidaire identifies suitable mentors from among the employees at work on the project who volunteer their skills on behalf of the selected associations. The budget allocated to this project by the fund in 2012 was €310,000, divided among 31 non-profits.

3.2.3

Actions and sponsorship to promote responsible driving and relations with road user associations

In the Contracting business, apart from public-private partnerships and the activities of VINCI Facilities (VINCI Energies), most VINCI clients are public authorities or other companies. In the Concessions business and under long-term partnerships, the customers of VINCI companies are private individuals, providing the opportunity to build relationships over time, particularly in the area of services. The VINCI Autoroutes Foundation for Responsible Driving, set up in February 2011, aims to raise awareness among drivers about road safety, promotes research on the risk of inattentiveness, which is responsible for a large number of fatal motorway accidents, and works to change driver behaviour through joint efforts with its partners and the various stakeholders, including institutions, professional bodies and non-profit organisations. This foundation gives VINCI Autoroutes a way of improving its understanding of the causes behind the accidents seen on today’s motorways, with the aim of designing new solutions and communicating more effectively to road users about these issues. The company’s effort has three thrusts. First, it backs initiatives by civil society organisations and supports innovative scientific research into certain areas of dangerous driving that have not been sufficiently explored or that are incorrectly identified by road users. Second, it carries out public information campaigns with the aim of raising awareness of road-related risks and promoting responsible driving. Third, it develops knowledge relating to the specific driving habits of different motorway user groups to help them take greater responsibility for their own safety on a day-to-day basis. In 2012, the budget allocated to the activities of the VINCI Autoroutes Foundation for Responsible Driving was €2 million. The major study financed by the foundation in 2011 and conducted by a team of researchers at Hôpital Raymond Poincaré in Garches, near Paris, released its findings in 2012. The team was able to complete a meticulous analysis of the sleep patterns of drowsy motorists and confirmed the direct link between sleep deprivation and episodes of falling asleep at the wheel. Furthermore, awareness campaigns targeting road users and the general public initiated in 2011 were expanded in 2012: risks related to alcohol consumption, the safety of motorway employees performing maintenance operations or coming to the assistance of drivers, special awareness days focusing on heavy goods vehicle drivers, participation in the 24-hour

VINCI 2012 Annual Report

Report of the Board of Directors

163

truck race and the organisation of special rest areas for the 24-hour motorcycle race in Le Mans. The partnership with SIFE France, covering both 2011 and 2012, to raise awareness of responsible driving practices among university students by inviting them to submit proposals for innovative projects, awarded a trophy to a team from ESDES Lyon for its “Les Roues de l’Espoir” (Wheels of Hope) project. Lastly, all employees of VINCI Autoroutes are encouraged to suggest ideas for awareness campaigns and propose partnerships with associations whose actions they are able to support with the financial backing of the VINCI Autoroutes Foundation for Responsible Driving. In 2012, the foundation’s selection committee approved 11 projects of this type, allocating a total budget of €70,000. In Greece, Gefyra, the Rion–Antirion bridge concession company, focused in 2012 on instilling dialogue and a process of consultation with users and local residents, promoting the user-citizen concept. The aim was to reconcile the expectations of stakeholders, often working at cross purposes, who are both users of the bridge and residents of the regions served. A very large number of consultation meetings were thus held during the year. An interactive newsletter was created, through which users are able to express their wishes.

3.2.4 Relations and sponsorship actions in support of non-profit organisations working to protect the environment and cultural heritage

As part of its goal to drive performance over the long term in all its areas of activity, VINCI selects partnerships with non-profit organisations working to protect nature as well as those active in the cultural realm. Environmental protection associations vary widely in their composition, governance, financing and expectations. The Group’s actions are therefore carried out at local level and reflect where the companies are operating, the specific characteristics of projects and the type of business being performed. By way of example, Entrepose Contracting (VINCI Construction), which is working on a pipeline construction project in Papua New Guinea, has provided financial backing to the naturalist expedition programme “La planète revisitée” (“Our planet revisited”), jointly organised by the Natural History Museum in Paris and the non-governmental organisation Pro-Natura International in partnership with the Institut de Recherche pour le Développement. The aim of these expeditions is to fill gaps in knowledge of species worldwide. For this third major expedition, some 200 researchers representing 21 different countries, but also students and volunteers, set out for Papua New Guinea, considered as one of the world’s most significant biodiversity hotspots. Neglected species were treated as priority survey targets: marine and land invertebrates, plants, fungi and algae. The teams also measured the human impact on ecosystems and changes expected due to climate change. Eurovia adheres to the French government’s national strategy to promote biodiversity. To this end, the business line has entered into a partnership with the French Natural History Museum, which will lend its scientific expertise and assist Eurovia in its ongoing efforts to improve its biodiversity management as part of its activities. LISEA, the concession company for the future Tours–Bordeaux high-speed rail line, has set up its Biodiversity Foundation, with a budget of €5 million over the next five years, involving the participation of representatives from France’s Biodiversity Research Foundation and Natural History Museum. Companies have a duty to contribute to cultural production, without neglecting the historical and regional context in which it is pursued. Across the Group, many companies are partners or sponsors of non-profit organisations protecting built assets, cultural institutions and events. At local level, VINCI companies volunteer their assistance and technical expertise in connection with a large number of projects aimed at restoring cultural heritage treasures. These companies are locally recognised for their voluntary actions and take part in heritage conservation efforts in line with long-standing traditions and predilections. VINCI is continuing its major cultural sponsorship actions by supporting local cultural initiatives across France, notably in the cities of Lyon, Nantes and Nancy, with the aim of continuing to preserve and raise the profile of artistic creation in the urban environment. Current sponsorship actions include the lighting of the Palais du Pharo in Marseille, which has dominated the entrance to this city’s harbour since the reign of Napoleon III, and the restoration of the Grand Salon at the Maison des Etudiants de l’Asie du Sud-Est, an architectural jewel at the Cité Internationale Universitaire in Paris. These are just a few examples of actions underscoring the Group’s commitment to cultural life in communities and preserving the heritage treasures of the past. At Group level, as a leading sponsor of archaeological heritage studies, VINCI is an active member of the group of industry players involved in land-use planning brought together by the Institut National de Recherches Archéologiques Préventive (INRAP, France’s rescue archaeology institute) and takes part in discussions to focus greater attention on and recognise the achievements of archaeological discoveries in the course of work on projects. In 2011, VINCI Airports renewed the partnership initiated in 2004, in the form of a five-year agreement to continue its financing of a major archaeological dig at the site of Siem Reap airport in Cambodia, in close proximity to the famed Angkor Temple complex. These digs are conducted by INRAP, in partnership with Apsara, the Cambodian government agency for the protection and management of Angkor and the Siem Ream region. In this region, archaeologists have tended to focus on the temples frequented by the elite in the heyday of the Khmer Empire, but this project aims to shed light instead on the way of life of the artisans having built the temples. In 2012, archaeological excavations near the airport’s runways yielded interesting discoveries about the region’s inhabitants during the period. They also provided an ideal opportunity to train Cambodian archaeologists, assisted by 85 VINCI employees at the site. VINCI Airports is also a long-standing partner and shareholder of Artisans d’Angkor, an organisation created to perpetuate and encourage the development of Khmer traditional crafts, while offering career possibilities to the underprivileged populations of the Siem Reap region. Each artisan receives a contractual salary and a full benefits package. Artisans d’Angkor has lifted some 5,000 families out of poverty and promotes economic vitality in the local area.

3.2.5 Partnerships and sponsorship actions to expand access to essential services and support social entrepreneurs

Around the world, wherever they operate, Group companies support solidarity and development initiatives. These actions are targeted, tailored to address local challenges and thus vary depending on the region and its socioeconomic circumstances. Initiatives pursued by subsidiaries also relate to the nature of the work carried out in each region, which may or may not involve their presence over the long term and may relate to large-scale projects completed in short time frames or recurring work, etc. As initiatives differ widely, this information is not consolidated at Group level. The examples below illustrate just a few of the actions conducted locally by subsidiaries. In Africa, Initiatives Sogea-Satom pour l’Afrique (Issa) supports projects in two main fields – assistance provided to social entrepreneurs and access to essential services – involving both financial aid and the sharing of skills by employee volunteers. In the area of assistance provided to social entrepreneurs, Issa supported 14 projects in 2012: agricultural development, support and promotion of local crafts and know-how, and equipment to improve production and productivity. Some 12 projects were supported in the area of access to essential services: access to water and electricity, access to education (refurbishment or construction of classroom facilities) and access to healthcare (dispensaries, maternity centres). In all, Issa committed €440,000 to projects in 2012 in several countries, chief among them Benin, Burundi, Morocco, Chad, Cameroon and South Africa.

164

Report of the Board of Directors

Personnel at all Sogea-Satom projects are involved in the fight against HIV/AIDS, with information meetings and awareness campaigns targeting employees and local residents where applicable. These meetings are held on a regular basis at worksites, organised by project supervisors in collaboration with local associations. In Chile, the Eurovia subsidiary Bitumix has been active for 25 years in social programmes, its actions prompted by the issues and needs it identifies among its employees, which are then expanded to serve the surrounding communities. For example, Bitumix has offered its employees and their families free medical care for 25 years, with a permanent facility receiving patients for medical and dental treatment several times a week. In 2012, 300 medical and psychiatric visits were accommodated and 700 treatments were delivered in the dental clinic set up by the company. The company also offers free check-up visits for employees’ newborn infants, from birth to 12 months of age. As another example of its wide-ranging commitment, in the event of natural disaster, Bitumix comes to the aid of communities. In the aftermath of a recent earthquake, the company provided machinery and labour for a period of four months to demolish damaged buildings and clear debris in the most affected areas.

3.3 3.3.1

Suppliers and subcontractors

See also page 21 of this annual report Manifesto commitment number 1: “Design and build together”

General policy

In 2012, purchases represented about 60% of the Group’s revenue, remaining stable compared with the previous year, and comprised of €9.43 billion for materials and €14.85 billion for external services, including subcontracting and the cost of temporary staff. During the year, VINCI reaffirmed its commitment to building balanced and sustainable relationships with its suppliers and subcontractors. The Group moved forward with efforts to measure and take into account workforce-related, social and environmental factors in the overall value chain. These efforts are overseen by the Purchasing Coordination unit at Group level, a relatively small structure that was reinforced in 2012 with the arrival of new experts specialising in specific purchasing categories. This unit works with the purchasing departments of business lines and subsidiaries, and reports to a member of VINCI’s Executive Committee. This approach is implemented at local level by purchasing networks, in particular through decentralised purchasing clubs in France and the various countries where VINCI operates. In September 2012, a national convention bringing together the members of all Group purchasing networks was held in Chantilly in the Greater Paris area to clarify VINCI’s purchasing strategy in relation to three areas: an optimised supplier selection process, strategic partnerships and sustainable development. This triennial event provided an opportunity to enhance internal communication, share best practices and promote a proactive approach for the integration of workforce-related, environmental and social criteria. A supplier charter explicitly describing overall performance commitments has been developed in order to communicate VINCI’s expectations to its partners and reaffirm the need for compliance with the 10 principles of the UN’s Global Compact. This document is currently being distributed to all Group suppliers. Complementing its own internal procedures, VINCI has signed the Charte des Relations Inter-Entreprises, developed by a special task force made up of French government representatives and members of the Compagnie des Dirigeants et Acheteurs de France (CDAF, the French industrial buyers association), as a further demonstration of its commitment to good conduct in client-supplier relations. Some 305 French companies have signed this charter since it was launched by the CDAF in February 2010 with the aim of promoting fair practices and improving relations between major clients and SMEs. Within the Group, VINCI Construction’s Purchasing Department has obtained ISO 9001 certification. In addition to the framework agreements signed by business lines and subsidiaries with their suppliers, over 800 national, European and global cross-business framework agreements were signed in 2012 to meet the multiple procurement requirements of Group companies. In 2012, the Sustainable Development and Purchasing Committee opened up several discussion groups. This forum helps foster long-term, balanced relationships with the Group’s suppliers and subcontractors and ensures that workforce-related, social and environmental issues are factored into the value chain. Its approach is to simplify and adjust internal communication to make it more operationally appropriate, to define and implement tools and methods, and to share and disseminate best practices. A new training programme to raise buyers’ awareness of key sustainable development issues is currently under development, designed to assist these staff members in their day-to-day activities by providing the tools and responses necessary to promote more responsible practices.

3.3.2

Managing relations with suppliers

In 2012, the Group’s purchasing policy led to an increasing emphasis on sustainable development criteria both when selecting products and suppliers and when drafting framework agreements and specifications for the Group and its business lines. These criteria take into account the environmental impact of products and services, the workforce-related arrangements for producing or providing them, and the social commitments made by suppliers. A review of feedback received clearly indicates that these efforts add value. Environmental performance. In its purchasing agreements, VINCI increasingly favours products that are more environment friendly. In 2012, several tenders included questionnaires aimed specifically at differentiating suppliers in relation to these concerns. For example, in the vehicle category (manufacturers and long-term rental companies), emphasis was placed on emission levels, the percentage of recycled materials and end-of-life procedures. The Group has also adopted initiatives regarding zero-emission vehicles and infrastructure development. VINCI is committed to reducing the carbon footprint of its vehicle fleet. Group companies have tested electric vehicles under real-world conditions and VINCI Park is taking part in Renault-Nissan’s Seine Aval Véhicules Electriques (SAVE) initiative to promote the use of electric vehicles. Over an 18-month period, this project will test the manufacturer’s electric vehicles in urban and suburban environments, supported by a pilot network of 300 charging stations. VINCI Autoroutes has implemented environmental clauses for all of its referenced suppliers as well as a shared assessment template used by ASF, Cofiroute and Escota. First used at VINCI Construction for purchases of fitting and finishing services, all Group suppliers are now assessed on the basis of ISO environmental criteria. This approach has been extended to all purchasing categories with a view to continuous improvement and enhanced coordination. Workforce-related performance. This strategy also involves paying greater attention to workforce-related and social issues when selecting suppliers. Safety concerns are a priority across the entire Group. In 2012, meetings were arranged with all temporary employment agencies to monitor their progress in implementing recommended measures and to reinforce dialogue with the suppliers involved. This referencing

VINCI 2012 Annual Report

Report of the Board of Directors

165

procedure resulted in significant improvements in the area of safety measures observed by temporary workers. In assessing the workforcerelated performance of purchasing, this is the primary differentiating factor. With regard to personal protective equipment, emphasis was placed on working conditions throughout the supply chain. VINCI Construction has introduced fines for failing to comply with safety clauses. In addition, a safety culture charter has been developed jointly by all stakeholders, including suppliers as well as joint contractors and subcontractors. Furthermore, a national strategy has been put in place for the monitoring of purchases of finished goods, involving the validation of selected suppliers by regional committees and the negotiation of Group-wide framework contracts allowing for greater involvement of VINCI’s commercial partners. Social responsibility performance. Across the Group and through its various projects, VINCI develops partnership-based approaches with its suppliers and favours relationships at local level with small and medium-sized enterprises (SMEs). The Group increasingly prefers suppliers with strong roots in their regions in its selection and bidding processes. Its policy also involves expanding purchases from companies and non-profit organisations that work towards social integration for the long-term unemployed and people with disabilities. A number of new initiatives focusing on the development of partnerships with sheltered workshops were launched in 2012 by the Group’s business lines, a banner year for this category of actions. In France, VINCI has signed a national framework agreement with Association des Paralysés de France for the collection and recycling of waste electrical and electronic equipment and with Ateliers Sans Frontières for the collection and refurbishment of discarded computer equipment for resale at preferential prices to other non-profit organisations. In 2012, nearly 54.5 tonnes of equipment were recycled. Revenue generated with sheltered workshops remained stable for the collection of WEEE. In connection with the project for the construction of the new Tours–Bordeaux high-speed rail line, a special unit has been set up to manage the €450 million in strategic purchases affecting multiple Group entities for the four business lines involved in the project. The aim of the preparatory phase was to put in place a procurement logistics system that would be viable over the long term, assist suppliers with workforcerelated and social requirements, contribute to the social integration aspect of the project and ensure the participation of local economic actors. Volumes have been allocated in accordance with supplier capacities. The Group’s civic engagement also takes the form of combating social exclusion and building bridges with people who suffer employment difficulties. To further these actions, a national consultation process was launched in summer 2012 to list temporary employment agencies in France that operate in the field of social integration through work. With social integration clauses being increasingly included in contracts, VINCI wants to anticipate its clients’ requirements and is therefore taking a proactive approach and supporting organisations that it works with to help them expand.

3.3.3

Managing relations with subcontractors

Subcontractors are generally selected from among small and medium-sized enterprises located near Group projects or worksites, thereby contributing to local economic development. These partners are increasingly involved in project planning and preparation. Workforce-related and environmental clauses are gradually being added to their contracts. The general policy is to strengthen relationships over the long term. Subcontractors and joint contractors have long demonstrated their commitment to the Group’s safety policy. A best practices charter is nearing finalisation with a view to dissemination to all subcontractors and joint contractors in the first half of 2013. The charter addresses the following topics: compliance with regulations in force, ethical behaviour, improvement of health and safety criteria; balanced business relations; fairness and objectivity in relations with partners; use of local enterprises; governance and social responsibility. VINCI Construction France has introduced specific clauses relating to environmental protection, waste management and the impact of its projects. Visual aids have been developed to raise awareness among all personnel concerned. These posters are available in French, Portuguese and Arabic, the three most common working languages at the entity’s worksites in France. As a further example, VINCI Construction Grands Projets trains all of its subcontractors in waste management, related risks and their potential impact. Through the Alive on Site programme, some 2,800 people have been trained in safety procedures. Emergency drills and the verification of qualifications are critical to the success of projects. Thanks to the use of the Insight system, the company’s accident frequency rate has been reduced by a factor of three since 2010. It monitors some 20 indicators to further improve practices at its worksites, including greater awareness of the environmental regulations affecting VINCI. Four-fifths of the revenue of VINCI Construction Grands Projets is derived from work with subcontractors.

3.3.4 Outlook

In 2012, VINCI’s Purchasing Coordination unit adopted sustainable development as a strategic priority. Over the next three years, the unit aims to ensure the comprehensive integration of workforce-related, social and environmental criteria by all Group companies, coupled with the development of a coordination and monitoring tool incorporating key indicators to assess progress in this area. The Group is currently examining the possibility of setting up an audit procedure for strategic purchases.

3.4 3.4.1

Fair business practices

See also page 22 of this annual report Manifesto commitment number 2: “Comply with ethical principles together”

Prevention of corruption

VINCI’s Code of Ethics and Conduct contains all the rules of conduct that apply to all Group companies and employees. In 2012, the Group continued its efforts to disseminate and explain the code to managers, who then made similar efforts within their own organisations. The Group actively monitors this procedure, and an intranet tool enables Executive Management and the Internal Audit team to check that it is being deployed. Reports are submitted to the Executive Committee on a regular basis, allowing remedial action to be taken quickly if required. Regular training sessions are organised to promote understanding of Group principles and values. At 31 December 2012, of the 6,499 people identified as particularly exposed, 95% had acknowledged receiving the code. The aim is to reach 100%. The appointment of an Ethics Officer as part of VINCI’s whistle-blowing arrangements was widely communicated within the Group. Any employee can contact the Ethics Officer in accordance with rules set out in the code, which include a guarantee of confidentiality, the commitment to respect the integrity and status of all employees, and the avoidance of discrimination. Several matters were referred to the Ethics Officer during

166

Report of the Board of Directors

the year. In each case, the issues were investigated thoroughly, in compliance with the aforementioned principles. In 2012, the Ethics Officer dealt with all queries received, resulting in various types of measure.

3.4.2

User health and safety

Road risks affect all VINCI employees who drive any of the Group’s 30,000 company vehicles or 10,000 site machines, as well as the 600 million users of motorways, roads, car parks and other infrastructure operated by VINCI worldwide under concession contracts. Campaigns are organised to raise awareness and training is provided for those employees most exposed to road risk. One of the working groups created as part of the Group’s Safe Together initiative has been tasked with promoting the sharing of best practices in this field. In October 2012, VINCI Autoroutes staged a Truck Village event on the A7 motorway for HGV drivers. The event was an opportunity to discuss road safety with professional drivers and describe a new range of services to them: medical screening, information on risks related to drowsiness and addictions, small covered athletic fields, and free charging stations for IT devices. As an example of its reinforced efforts in this area, in 2011, VINCI Autoroutes set up a corporate foundation to promote responsible driving and raise awareness of the dangers of poor road safety, the VINCI Autoroutes Foundation for Responsible Driving (see 3.2.3). In partnership with the non-profit organisation “40 millions d’Automobilistes”, the foundation distributed 100,000 breathalysers at 12 service areas on French motorways in May 2012 over Ascension weekend. The purpose of this accident prevention campaign was to encourage drivers to test themselves in order to know their alcohol consumption limits and thus help keep roads and motorways safe.

3.5

Human rights

VINCI has been a signatory to the UN Global Compact since 2003. It is thus committed to supporting and promoting respect for human rights within its sphere of influence, and to ensuring that Group companies are not complicit in human rights abuses. In practical terms, the Group acts on this commitment by including clauses relating to human rights in its framework agreements with suppliers and subcontractors. The external audit of QDVC (VINCI Construction Grands Projets) performed in 2011 by an independent consultancy (Vigeo Group), identified areas for improvement in relation to protecting and promoting human rights internationally and provided an opportunity to test Advance, the Group’s sustainable development self-assessment questionnaire. As a result of these actions, the Group’s procedures for the identification of human rights risks were refined in 2012. With respect to employees and subcontractors working on VINCI sites as well as the Group’s suppliers, the key human rights issues are preserving the wellbeing of Group employees and all those who work on VINCI sites, protecting the fundamental rights of migrant workers, the right to a decent salary, avoidance of discrimination, freedom of association and the right to collective bargaining, and the prohibition of child labour and forced labour. The fundamental rights of populations likely to be affected by the Group’s activities include in particular risks associated with the use of security services, property rights in the event of expropriation and the rights of indigenous peoples. The operational application of VINCI’s human rights policy is carried out by its subsidiaries, using Advance, the Group’s self-assessment tool, to identify their risks precisely, based on their activities and the countries where they operate. The Group’s Delegation for Sustainable Development and its Purchasing Coordination unit lend their expertise as necessary. The latter disseminates framework agreements and has drafted a charter setting out the global performance commitments of VINCI suppliers, explicitly stating the Group’s policies with regard to human rights and working conditions. No disputes, claims or controversies of any kind arose in relation to human rights in 2012.

4.

Note on the methods used in social and environmental reporting VINCI’s social and environmental reporting framework complies with Articles L.225-102-1, R.225-104 and R.225-105 of the French Commercial Code and is based on the transparency principles of the Global Reporting Initiative (GRI).

4.1

Methodological procedures

VINCI’s procedures are specified in the following materials: For social indicators: - a guidebook in four languages (French, English, German and Spanish) containing social indicator definitions; - a methodological guide to VINCI’s social reporting system, including a reporting tool users’ manual in four languages (French, English, German and Spanish); - a guide to consistency checks in two languages (French and English);

ˇˇ

For environmental indicators:  - a methodological guide to VINCI’s environmental reporting system, including a guide to the definition of common indicators, which entities can use to set up their environmental reporting procedures. This guide is available in two languages (French and English); - an IT system users’ manual in two languages (French and English); - an audit guide helping entities to make preparations and respond to audit results (available in French and English).

ˇˇ

All of the above materials are accessible on the Group’s intranet site. The Group’s efforts to accelerate its social and environmental reporting process in 2010 resulted in: new methods for earlier preparation of social indicators, applicable to all entities since 2011; ˇˇ the shifting of the reference period for environmental reporting by one quarter (the reference period for year Y is now from 1 October Y-1 to 30 September Y). This change has applied to all entities since 2010. ˇˇ

VINCI 2012 Annual Report

Report of the Board of Directors

167

4.2 Scope

The reporting scope is intended to be representative of all VINCI’s business activities: social reporting has covered all Group entities by worldwide revenue since 2002; ˇˇ in 2012, environmental reporting covered 95% of Group entities by worldwide revenue. ˇˇ

Since 2011, the consolidation rules used for these scopes are the same as the financial consolidation rules, except for the following entities, which are still consolidated proportionally: ˇˇ VINCI Construction Grands Projets: all projects; ˇˇ CFE: all CFE group companies, including the stake in DEME (Belgium); ˇˇ Soletanche Freyssinet: Tierra Armada SA, Grupo Rodio Kronsa and Freyssinet SA (Spain). These consolidation rules apply to all reporting indicators, except the “number of environmental incidents” indicator, in which all incidents count for 1. Changes in scope Social reporting scope: changes in scope in year Y are taken into account in the same year. ˇˇ Environmental reporting scope: changes in scope in year Y are taken into account in year Y+1. ˇˇ

4.3

Indicator selection

Indicators are selected on the basis of the social and environmental impact of the Group’s activities and the risks associated with those activities. There are three levels of core social indicators: those specified in Articles R.225-104 and R.225-105 of the French Commercial Code; ˇˇ those included in the social report, as required by French law; and ˇˇ specific indicators reflecting VINCI’s human resources policy. ˇˇ

The complementary nature of these three levels of indicators makes it possible to measure the results of the Group’s human resources policy and social commitments. The core environmental indicators are made up of five types: resource consumption (energy/CO2 and water); ˇˇ waste management and recycling; ˇˇ certifications and special projects; ˇˇ environmental awareness and training; ˇˇ environmental incidents and provisions for environmental risks. ˇˇ

Each business line continues to use its own additional indicators, which are based on its specific environmental challenges.

4.4

Methodological explanations and limitations

The methodologies used for some social and environmental indicators may be subject to limitations due to: ˇˇ differences between French and international definitions (which VINCI is working to harmonise); ˇˇ differences in labour and social laws in some countries; ˇˇ the fact that some estimates may not be representative or that some external data required for calculations may not be available, particularly data required for environmental indicators at VINCI Construction, where a statistical approach is being deployed for this purpose; ˇˇ changes in indicator definitions that could affect their comparability; ˇˇ changes in business scope from one year to the next; ˇˇ the difficulty of collecting data from a subcontractor or joint venture with external partners; ˇˇ the procedures for collecting and entering this information. Eurovia France and Eurovia Belgium’s water consumption and Eurovia France’s energy consumption are calculated on the basis of financial amounts and associated average prices for the 2012 environmental reporting reference period. Continued efforts are being made to report consumption levels directly. Due to the restructuring at the end of September 2012 that impacted some entities recently integrated into VINCI Energies France, these entities did not report actual environmental data for the third quarter of 2012 but provided estimates based on the previous nine months. For VINCI plc, figures for total waste generation and the percentage of waste recycled are based on estimated fill ratios of waste skips, taking into account the type and density of the waste. Since 2011, VINCI Park in France has altered its method of calculating purchased water consumption. For car parks outside Paris that do not have automatic sprinkler-type fire extinguishing systems, water consumption is calculated from the total purchase cost of water divided by its average price in France. For other car parks, water consumption corresponds to the volume of water purchased. Total energy consumption is expressed in MWh Higher Calorific Value (HCV). The conversion factors used are 0.0104 MWh/litre, 12.027 MWh/ tonne and 4.839 MWh/tonne for motor fuel, heavy fuel oil and coal (lignite), respectively.

168

Report of the Board of Directors

For VINCI Construction France, consumption of water, electricity and heating oil on worksites (“mobile sites”) is estimated using a statistical method. Coefficients reflecting the relationship between environmental indicators and revenues are calculated on the basis of a representative sample of worksites. These coefficients were then used to extrapolate results to all worksites, by applying them to consolidated revenue for the period from 1 October 2011 to 30 September 2012. The figures in the Annual Report are based on data known at the end of the financial year. They may, however, be adjusted the following year if a significant anomaly is observed and provided that the adjustment is substantiated in detail. None of the figures published in the 2011 Annual Report were adjusted in 2012. Occupational illnesses are defined as illnesses contracted following prolonged exposure to a professional risk (noise, hazardous products, posture, etc.) and recognised as such by the regulations in force.

4.5

Consolidation and internal control

Social data is collected from each operational entity using a specific package of the “Vision II” data reporting system, including automatic controls. Data is checked and validated by the Group entities themselves. This data is then consolidated in two steps: ˇˇ Step 1: business lines Each business line consolidates all data within its scope. When consolidation takes place, data consistency checks are carried out. Having been consolidated and checked at the business-line level, data is then provided to the Group Human Resources Department. ˇˇ Step 2: Group Human Resources Department The Group HR Department consolidates data across the whole scope and checks its consistency. Environmental data is collected, checked, consolidated and validated by the environment managers in each business line and division using their own IT tools. The data is then consolidated centrally using “Vision II”. When consolidation takes place, data consistency checks are carried out at Group level by the Delegation for Sustainable Development. Comparisons are made with the previous year’s data and any material discrepancies are analysed in detail.

4.6

External controls

Each year since 2003, VINCI has asked its Statutory Auditors to give their opinion on the quality of the procedures used to report social and environmental information. In 2012, the audit was conducted by both Statutory Auditors. The social and environmental indicators that they audited are identified in the tables by the þ symbol (see pages 139 to 157). The nature of the auditing work carried out and the findings are presented on pages 177 to 178.

VINCI 2012 Annual Report

Report of the Board of Directors

169

F. General Information about the Company and its share capital 1.

Corporate name and Articles of Association Corporate name: VINCI Registered office: 1 cours Ferdinand-de-Lesseps, 92500 Rueil Malmaison, France Telephone: + 33 1 47 16 35 00 – Fax: + 33 1 47 51 91 02. Type of company: French public limited company (“Société Anonyme”) with a Board of Directors Applicable legislation: French Date of formation: 1 July 1908 Legal term of existence: The initial duration was set at 99 years and was extended by another 99 years on 21 December 1979. The date of expiry is thus 21 December 2078, unless the term of existence is extended once again or the company is liquidated at an earlier date. Financial year: From 1 January to 31 December Registration number: RCS 552 037 806 Nanterre – Siret no. 552 037 806 00585 – Code NAF: 7010Z Place where legal documents can be consulted: Legal documents relating to VINCI are available at its registered office, at the Clerk’s Office of the Nanterre Commercial Court and on the Company’s website (www.vinci.com). Corporate purpose (Article 2 of the Articles of Association) The Company has as its purpose: ˇˇ undertaking all forms of civil engineering: in particular, development of the goodwill originally contributed by Sainrapt-et-Brice and continuation of the business of that company, specialising in all types of underground works, foundations, hydraulics and reinforced concrete; and ˇˇ more generally, all industrial, commercial, financial, securities and property operations directly or indirectly related to the purposes specified above. The Company may pursue these operations in metropolitan France and overseas France, as well as other countries, either alone, or in partnership, on a trading basis, or in any other form whatsoever, either directly, or indirectly through transfer, leasing arrangements or under licence, either on a brokerage or commission basis. In addition, it may implement any measures, either alone or by any other means, create any partnerships or companies, make any contributions in kind to existing companies, merge or enter into alliances with them, subscribe, purchase and resell any shares or other corporate rights, take all orders and extend any loans, credits and advances. Statutory appropriation of income (excerpt from Article 19 of the Articles of Association) At least 5% of the income for the year, after deduction of any previous year’s losses, is taken to the statutory reserve. This ceases to be obligatory when the reserve reaches an amount equal to 10% of the share capital. This process is to resume when the reserve falls below this 10% level. The income available for distribution consists of the income for the year (after deduction of previous years’ losses as well as any amounts set aside in reserves in application of the law or Articles of Association) and retained earnings. The Shareholders’ General Meeting allocates the following from this distributable income: ˇˇ any amounts considered by the Board of Directors as appropriate for constituting or supplementing any ordinary or special reserves, or for carrying over to the next year as retained earnings; ˇˇ the amount required for distribution to shareholders by way of a first dividend, equal to 5% of the amounts of their fully paid, unredeemed shares. Shareholders cannot, however, claim this dividend against the income of subsequent years should the income of a given year be insufficient for the dividend payment; ˇˇ the balance available after these allocations is distributed in respect of all shares, in proportion to the amount of the share capital they represent. Following a proposal from the Board of Directors, the Shareholders’ General Meeting may decide to distribute amounts taken from available reserves. In such a case, the decision must indicate the specific reserves from which the amounts are to be taken. Except in the case of a capital reduction, no distribution to shareholders may be made if the shareholders’ equity is (or would be, following such a distribution) less than the amount of the share capital plus any reserves whose distribution is not permitted under the law or Articles of Association. The conditions for payment of dividends agreed by the Shareholders’ General Meeting are determined by the Shareholders’ General Meeting or, failing that, by the Board of Directors. The payment of dividends must occur within nine months of the year-end, unless this deadline is extended by a Court decision. The Shareholders’ General Meeting may offer each shareholder, for all or for part of the dividend or interim dividend distributed, the choice between payment in cash and payment in shares. Shareholders’ General Meetings (Article 17 and excerpt from Article 8 of the Articles of Association) Article 17 of the Articles of Association is described in the Report of the Chairman of the Board of Directors, part A5 “Formalities for participation of shareholders in the Shareholders’ General Meeting”, page 187. Excerpt from Article 8 of the Articles of Association: In addition to the voting right attached to it under the law, each share gives the right to a proportion (based on the number and nominal value of outstanding shares) of the Company’s assets, earnings and liquidating dividends.

170

Report of the Board of Directors

Statutory threshold provisions (excerpt from Article 10b of the Articles of Association) In addition to the obligations relating to declaration thresholds set out in paragraph 1 of Article L.233-7 of the French Commercial Code, any individual or legal entity, acting alone or in concert, who comes to hold or ceases to hold a proportion of the share capital, voting rights or securities giving future access to the Company’s share capital, equal to or greater than 1%, or a multiple thereof, including a multiple exceeding the reporting threshold as defined by legislative and regulatory provisions in force, must inform the Company within five stock market trading days of the date of crossing one of these thresholds or, when a Shareholders’ General Meeting has been convened, no later than midnight (Paris time) of the third business day preceding the meeting, of the total number of shares, voting rights or securities giving future access to the Company’s share capital that it holds on its own account directly or indirectly, or in concert. Failure to meet this obligation will be sanctioned by the loss of the voting rights attached to the shares exceeding the undeclared proportion at any Shareholders’ General Meeting held within two years of the date of the due notification provided for above. This sanction is applied if so requested by one or several shareholders holding at least 5% of the Company’s share capital and if the request is entered in the minutes of the Shareholders’ General Meeting. Shareholder identification (excerpt from Article 10b of the Articles of Association) The Company is entitled to ask the securities clearing body, under the conditions defined by the regulations in force, for the name, nationality and address of individuals or legal entities holding securities that confer, now or in the future, voting rights at its Shareholders’ General Meetings; for the number of securities held by each individual or legal entity; and, where applicable, the restrictions attached to those securities.

2.

Relations between the parent company and subsidiaries

2.1

Organisation chart (*)

VINCI CONCESSIONS VINCI Autoroutes

VINCI Concessions

ASF

VINCI Park

Escota

CONTRACTING VINCI Construction

VINCI Energies

Eurovia

VINCI Construction France

Soletanche Freyssinet

VINCI Energies France

French subsidiaries

UK and Indian subsidiaries

VINCI Airports

VINCI Construction UK

Entrepose Contracting

VINCI Energies International

ETF

Other European subsidiaries

Cofiroute

Rail

CFE (Belgium)

VINCI Construction Grands Projets

VINCI Energies GSS

Specialised subsidiaries

North and South American subsidiaries

Arcour

Highways

Sogea-Satom (Africa)

VINCI Construction Terrassement

VINCI Facilities

VINCI Stadium

VINCI Construction Overseas France

Dodin Campenon Bernard

VINCI Immobilier

Subsidiaries in Central Europe (*) Simplified organisation chart of the Group at 31 December 2012. VINCI’s direct shareholdings in subsidiaries and affiliates are described on page 290. The list of the main consolidated companies (pages 268–274) gives an indication of the subsidiaries that comprise the Group and of VINCI’s equity interest (whether direct or indirect) in the various entities.

VINCI 2012 Annual Report

2.2

Report of the Board of Directors

171

Role of the VINCI holding company towards its subsidiaries

The VINCI holding company has no operational activities of its own. The Group’s operational activities are carried out by a large number of affiliates (there were 2,350 consolidated affiliates at 31 December 2012), which are organised into five business lines within two core businesses, Concessions (VINCI Autoroutes and VINCI Concessions) and Contracting (VINCI Energies, Eurovia and VINCI Construction). VINCI Immobilier, which is in charge of property development activities, reports directly to the VINCI holding company. The holding company provides leadership and supervisory functions for the Group’s operational entities, supplying services and assistance to its subsidiaries in the following areas: ˇˇ development and execution of strategy, acquisitions and disposals, and the study and implementation of industrial and commercial synergies within the Group; ˇˇ provision of expertise in administrative, legal, human resources, tax, financial, communication and sustainable development matters. VINCI also shares with its subsidiaries the benefits associated with the Group’s size and reputation, such as access to internationally recognised partners, optimisation of terms for financing, purchases and insurance, easier access to regulatory authorities, and public relations.

2.3

Movements of funds between the VINCI holding company and its subsidiaries

The main movements of funds between the VINCI holding company and its subsidiaries, other than the payment of dividends, are as follows: Payment for the holding company’s assistance to its subsidiaries In exchange for the assistance provided to its subsidiaries, the holding company receives a fee depending on the services provided. In 2012, fees for assistance received by VINCI from its subsidiaries amounted to €103 million. Centralised cash management Group subsidiaries’ cash surpluses are generally invested with the holding company through a cash pooling system. In return, the holding company meets subsidiaries’ financing needs. The holding company acts on the money and financial markets on its own behalf or on its subsidiaries’ behalf, investing and borrowing funds as necessary. With some exceptions (the main one to date being ASF and its subsidiaries in accordance with the contracts entered into with the Caisse Nationale des Autoroutes), this system applies to all French subsidiaries wholly owned, directly or indirectly, by VINCI. VINCI Finance International, a wholly owned subsidiary of VINCI, centralises all the cash flows of foreign subsidiaries working in the Group’s main markets in Europe and North America. VINCI and VINCI Finance International may make medium-term loans to some subsidiaries to finance investments and working capital and receive funds from other subsidiaries for fixed-term deposits. At 31 December 2012, these transactions represented outstandings for VINCI of €2,160 million for medium-term loans and €788 million for fixed-term deposits, and outstandings for VINCI Finance International of €3,851 million for medium-term loans and €212 million for fixed-term deposits. Regulated agreements There are regulated agreements between VINCI and its subsidiaries, which are subject to prior authorisation by the Board of Directors, special reports by the Statutory Auditors and approval by the Shareholders’ General Meeting.

3.

General information about VINCI’s share capital All changes in share capital or in the rights attached to the shares are statutory to general legal provisions. The Articles of Association do not provide for additional conditions (except as regards statutory thresholds, see paragraph 1 “Corporate name and Articles of Association”). On 31 December 2012, VINCI’s share capital amounted to €1,443,368,380, represented by 577,347,352 shares, each with a nominal value of €2.50, fully paid-up and all of the same class. VINCI shares are registered or bearer shares, at the shareholder’s choice, and may be traded freely.

172

3.1

Report of the Board of Directors

Movements in share capital over five years Capital increase/ (reduction) (in euros)

Share premium arising on contributions or mergers (in euros)

Number of shares issued or cancelled

Group Savings Scheme

8,476,643 

139,104,535 

3,390,657 

489,367,445 

1,223,418,613 

Share subscription options exercised

5,887,258 

31,048,028 

2,354,903 

491,722,348 

1,229,305,870 

11,100,330 

185,751,933 

4,440,132 

Position at 31/12/2007

Payment of dividend in shares Position at 31/12/2008 Group Savings Scheme Share subscription options exercised Payment of dividend in shares

Share subscription options exercised Payment of dividend in shares Cegelec contribution

Share subscription options exercised

Share subscription options exercised

1,214,941,970 

496,162,480 

1,240,406,200 

496,162,480 

1,240,406,200 

207,017 588 

9,068,684 

505,231,164 

1,263,077,910 

44,962,646 

2,942,316 

508,173,480 

1,270,433,700 

31,960,175 

334,842,687 

12,784,070 

520,957,550 

1,302,393,875 

520,957,550 

1,302,393,875 

15,091,573 

187,374,980 

6,036,629 

526,994,179 

1,317,485,448 

8,955,645 

54,594,480 

3,582,258 

530,576,437 

1,326,441,093 

2,610,025 

36,999,714 

1,044,010 

531,620,447 

1,329,051,118 

52,500,000 

792,067,549 

21,000,000 

552,620,447 

1,381,551,118 

552,620,447 

1,381,551,118 

25,210,833 

317,288,509 

10,084,333 

562,704,780 

1,406,761,950 

6,429,730 

44,549,294 

2,571,892 

565,276,672 

1,413,191,680 

565,276,672 

1,413,191,680 

Position at 31/12/2011 Group Savings Scheme

485,976,788 

7,355,790 

Position at 31/12/2010 Group Savings Scheme

Share capital (in euros)

22,671,710 

Position at 31/12/2009 Group Savings Scheme

Number of shares outstanding

22,643,660 

252,503,166 

9,057,464 

574,334,136 

1,435,835,340 

7,533,040 

52,984,072 

3,013,216 

577,347,352 

1,443,368,380 

577,347,352 

1,443,368,380 

Position at 31/12/2012

3.2

Potential capital

3.3

Changes in the breakdown of share capital and voting rights during the last three years

The only existing financial instruments that could cause the creation of new shares are the share subscription options granted to VINCI officers and employees (see section D, “Company officers and executives”, paragraph 4.2, on page 134 of the Report of the Board of Directors for details of these options). Share subscription options would become exercisable in the event of a public offer.

Breakdown of share capital (*) December 2012 Number of shares

% capital

December 2011

% voting rights

Number of shares

% capital

% voting rights

December 2010 Number of shares

% capital

% voting rights

Treasury shares (**)

41,102,058 

7.1%

25,021,501 

4.4%

11,360,406 

2.1%

Employees (company mutual funds)

57,382,650 

9.9%

10.7%

55,590,796 

9.8%

10.3%

49,904,956 

9.0%

9.2%

98,484,708 

17.1%

10.7%

80,612,297 

14.3%

10.3%

61,265,362 

11.1%

9.2%

Total not publicly held

2,536,738

0.4%

0.5%

2,447,566 

0.4%

0.5%

2,507,943 

0.5%

0.5%

Other individual shareholders

Company officers

60,613,393

10.5%

11.3%

65,442,081 

11.6%

12.1%

63,845,270 

11.6%

11.8%

Total individual shareholders

63,150,131 

10.9%

11.8%

67,889,647 

12.0%

12.6%

66,353,213 

12.0%

12.3%

Qatari Diar

31,500,000 

5.5%

5.9%

31,500,000 

5.6%

5.8%

31,500,000 

5.7%

5.8%

8,156,877 

1.4%

1.5%

15,712,512 

2.8%

2.9%

20,987,172 

3.8%

3.9%

Financière Pinault Other institutional investors

376,055,636 

65.1%

70.1%

369,562,216 

65.4%

68.4%

372,514,700 

67.4%

68.8%

Total institutional investors

415,712,513 

72.0%

77.5%

416,774,728 

73.7%

77.1%

425,001,872 

76.9%

78.5%

Total

577,347,352 

100.0%

100.0%

565,276,672 

100.0%

100.0%

552,620,447 

100.0%

100.0%

(*) Estimate at end-December on the basis of registered named shareholders, a schedule of identifiable bearer shares and a shareholding survey conducted with institutional investors. (**) Treasury shares held by VINCI SA.

Employee shareholders Details of the Group Savings Scheme are given in the “Social and environmental information” section of the Report of the Board of Directors on page 143 and in Notes E.18 and E.19.3 to the consolidated financial statements. Voting rights The difference between the breakdown of shareholdings and voting rights is due to the absence of voting rights attached to treasury shares. There are no double voting rights.

VINCI 2012 Annual Report

Report of the Board of Directors

173

Crossing of shareholding thresholds According to the declarations received by the Company in 2012 notifying that the legal threshold of 5% or the 1% threshold provided for in the Articles of Association of share capital or voting rights had been crossed, the shareholders identified at 31 December 2012 as owning more than 1% of the share capital or voting rights, other than those shown in the table on the previous page, are as follows: ˇˇ Alecta: one declaration in 2012, which mentions a shareholding in VINCI of 1.0% on 11 January 2012; ˇˇ Société Générale: four declarations in 2012; the latest mentions a shareholding in VINCI of 4.5% on 14 May 2012; ˇˇ Crédit Suisse: six declarations in 2012; the latest mentions a shareholding in VINCI of 1.3% on 15 May 2012; ˇˇ Natixis: two declarations in 2012; the latest mentions a shareholding in VINCI of 1.9% on 29 May 2012; ˇˇ Amundi: five declarations in 2012; the latest mentions a shareholding in VINCI of 3.1% on 19 July 2012; ˇˇ UBS: two declarations in 2012; the latest mentions a shareholding in VINCI of 1.4% on 19 November 2012. In a letter dated 6 February 2012, Financière Pinault, in presumed concert with its subsidiaries Artémis 12 and TEM, declared that on 31 January 2012 its shareholding fell below the threshold of 2% of the Company’s share capital or voting rights, to 1.4% of the share capital. To the best of the Company’s knowledge, there are no other shareholders owning 1% or more of the share capital of VINCI who declared in 2012 having crossed either the legal threshold or the threshold provided for in the Articles of Association. Shareholder agreements In April 2010, following the transaction under which Cegelec was transferred to VINCI, the Qatari Diar Real Estate Investment Company (Qatari Diar) acquired a shareholding in VINCI. This acquisition was accompanied by a stable shareholding agreement, under which VINCI agreed to reserve a seat on its Board of Directors for a person nominated by Qatari Diar and the first director was appointed by the Shareholders’ General Meeting of 6 May 2010. Since 29 November 2012, Mr Abdul Hamid Janahi has been the permanent representative of Qatari Diar, replacing Mr Yousuf Ahmad Al Hammadi. Under the agreement, Qatari Diar shall maintain a shareholding in VINCI of between 5% and 8% for a period of three years starting on 14 April 2010, barring certain non-significant exceptions (see the 14 April 2010 press release issued regarding this transaction). VINCI shall have a right of first offer (or, in some cases, a pre-emptive right) on any disposals by Qatari Diar of blocks of shares representing more than 1.0% of the share capital. To the best of the Company’s knowledge, with the exception of this agreement and the presumed concerted action of Financière Pinault with Artémis 12 and TEM, which it controls, there are no shareholder agreements or groups of shareholders acting as partners. Registered shareholders At 31 December 2012, the Company had 4,264 shareholders whose registration is managed by the Company and 1,513 shareholders whose registration is managed by a financial institution. At that date, 304,851 shares whose registration is managed by the Company and 188,144 shares whose registration is managed by a financial institution were pledged.

3.4 3.5

Treasury shares

The disclosures required under Article L.225-211 of the French Commercial Code are made in Note C.3 to the parent company financial statements on page 283.

Shareholders’ agreement relating to ASF shares

In December 2006, in connection with the financing of the transfer by VINCI of its 22.99% shareholding in ASF to ASF Holding, VINCI entered into a shareholders’ agreement with its subsidiary ASF Holding, to which this shareholding was transferred, under which the two companies organise their relations within ASF. Under the terms of this agreement, the parties undertake, as majority shareholders of ASF, to act in such a way as to ensure that the decisions made by the competent governing bodies of ASF comply with: ˇˇ the principle of implementing and maintaining a policy of maximising the dividends distributed on the basis of ASF’s distributable income and reserves, provided ASF meets its commitments to a syndicate of 23 banks in respect of the €3.5 billion financing signed on 18 December 2006, and, in particular, with the following financial ratios, calculated on the basis of ASF’s consolidated financial statements: net debt to cash flow from operations(*) ≤ 7 and cash flow from operations(*) to net financial costs ≥ 2.2; ˇˇ the prior conditions for any disposal by ASF of shares it holds in Escota, as defined in the credit line agreements signed on 18 December 2006 with a bank syndicate by ASF and ASF Holding of €3.5 billion and €1.2 billion respectively. VINCI undertakes furthermore that VINCI Concessions will return to ASF Holding the sums that ASF Holding may have made available to it under Group centralised cash management agreements, should ASF Holding be required to make early repayment of its syndicated loan of €1.2 billion; that it will maintain, directly or indirectly, a shareholding in ASF giving it access to a majority of the share capital and voting rights. This commitment ended when ASF Holding increased its shareholding in ASF so as to hold the majority of the share capital and voting rights directly. The parties also undertake, in the event of the sale of shares giving a third party a blocking minority in ASF, to require that third party to sign the shareholders’ agreement beforehand. The shareholders’ agreement was to remain in force as long as any money remained due to the banks under ASF Holding’s syndicated loan. Given that the syndicated loan was repaid in advance on 29 June 2012, the shareholders’ agreement ended on that date. VINCI has not entered into any agreements other than this agreement that could have a material effect on its share price. However, it should be stated that the formation of companies by VINCI with other parties may have resulted in agreements being made. This is the case in particular for Cofiroute, Stade de France Consortium and companies created specifically for the needs of securing and managing infrastructure concessions. The main purpose of these agreements is to organise the respective rights of shareholders in the event of the disposal of shares, and if applicable, to set certain operating principles for the corporate governing bodies. (*) Before tax and financing costs.

174

3.6

Report of the Board of Directors

VINCI shares and the stock market

The VINCI share is traded on the regulated market of Euronext Paris (Compartment A) and on several Multilateral Trading Facilities (MTFs), of which the main ones are Chi-X, Turquoise and BATS. In 2012 as a whole, 69% by volume of the trades were on Euronext Paris and 31% on MTFs. The VINCI share is included in particular in the CAC 40, Euronext 100, Euro Stoxx 50, Euro Stoxx Construction & Materials, Euro Dow and Aspi Eurozone indexes. Changes in the stock price and in trading volumes over the last 18 months were as follows (source: Euronext Paris and Bloomberg):

2011 

2012 

Average price(1) (in euros)

Highest(2) (in euros)

Lowest(2) (in euros)

Transactions(3) (in millions of shares)

Value of transactions (4) (in € millions)

July

41.4 

44.8 

38.8 

65.8 

2,727.6 

August

35.3 

41.4 

32.1 

108.5 

3,823.5 

September

32.9 

36.5 

29.5 

96.4 

3,171.4 

October

34.5 

38.2 

30.0 

69.1 

2,386.0 

November

32.1 

36.0 

28.5 

96.7 

3,103.3 

December

32.6 

34.3 

31.1 

74.3 

2,422.3  2,451.6 

January

35.5 

37.1 

33.6 

69.0 

February

38.0 

39.6 

35.7 

60.5 

2,297.2 

March

39.4 

40.9 

37.7 

57.2 

2,255.0 

April

35.4 

39.2 

32.2 

77.3 

2,738.4 

May

33.7 

35.7 

31.5 

84.4 

2,846.4 

June

33.7 

36.9 

31.2 

75.6 

2,546.1 

July

35.2 

38.0 

32.1 

74.7 

2,632.3 

August

34.7 

36.0 

32.1 

48.8 

1,693.3 

September

35.2 

37.0 

33.2 

60.2 

2,119.8 

October

34.1 

35.8 

33.1 

52.8 

1,803.0 

November

33.3 

34.9 

31.8 

54.3 

1,805.9 

December

35.4 

36.7 

33.9 

41.6 

1,471.6 

(1) Average of closing prices (Euronext Paris). (2) Price during trading sessions (Euronext Paris). (3) Volume of transactions (Euronext + MTF). (4) (Volume of transactions Euronext + MTF) x average price.

4.

Matters that could be material in the event of a public offer In application of Article L.225-100-3 of the French Commercial Code, matters that could be material in the event of a public offer are as follows: a) Structure of the Company’s share capital

F. General information, paragraph 3.3 “Changes in the breakdown of share capital and voting rights during the last three years”

b) Restrictions in the Articles of Association on the exercise of voting rights and the transfer of shares or clauses of agreements brought to the Company’s knowledge in application of Article L.233-11

F. General information, paragraph 1 “Statutory threshold provisions (excerpt from Article 10b of the Articles of Association)”

c) Direct or indirect investments in the Company’s share capital of which it has knowledge by virtue of Articles L.233-7 and L.233-12

F. General information, paragraph 3.3 “Crossing of shareholding thresholds”

d) The list of holders of any shares granting special control rights and description thereof

F. General information, paragraph 3.3 “Registered shareholders”

e) Control arrangements provided for if there is an employee shareholding system in place, whenever rights to control are not exercised by the employees

F. General information, paragraph 3.3 “Employee shareholders”

f) Any agreements between shareholders of which the Company has knowledge and that could entail restrictions on the transfer of shares and the exercise of voting rights

F. General information, paragraphs 3.3 “Shareholder agreements” and 3.5 “Shareholders’ agreement relating to ASF shares”

g) The rules applicable to the appointment and replacement of members of the Board of Directors and to amendments of the Articles of Association

Report of the Chairman on corporate governance and internal control procedures, provisions of law and Articles of Association

h) The powers of the Board of Directors, in particular for the issue or buy-back of shares

Table of authorisations regarding share capital increases attached to the Report of the Board of Directors and F. General information, paragraph 3.2 “Potential capital”

i) Agreements entered into by the Company that are amended or cease in the event of a change of control of the Company, unless this disclosure would seriously undermine its interests, except when such disclosure is a legal obligation

F. General information, paragraph 3.5 “Shareholders’ agreement relating to ASF shares” Note 22.2.5 to the consolidated financial statements

j) Agreements providing for compensation payable to members of the Board of Directors or employees if they resign or are dismissed without valid grounds or if their employment is terminated due to a public offering

D. Company officers and executives, paragraph 3.2 “Remuneration received by the Chairman and Chief Executive Officer”, Report of the Chairman of the Board on corporate governance and internal control procedures

VINCI 2012 Annual Report

175

Report of the Board of Directors

5. Other information on the Company forming an integral part of the Report of the Board of Directors The sections “Stock market and shareholder base” (pages 30-31), “Parent company financial statements” (pages 276-291) and the consolidated financial statements (pages 195–274) form an integral part of the Report of the Board of Directors. The following documents are annexed to the Report of the Board of Directors: the Report of the Chairman of the Board of Directors on corporate governance and internal control procedures (pages 179–192); ˇˇ the table of financial results over the last five years (page 291); ˇˇ the table below of authorisations granted to increase the share capital (pages 175–176). ˇˇ

Authorisations granted to the Board of Directors to increase the share capital and carry out other financial transactions The authorisations currently in force are as follows:

Date of Shareholders’ General Meeting

Date of expiry

Maximum amount of issue (nominal value)

12/04/12 (Fifth resolution)

11/10/13

€2,000 million 10% of the share capital

12/04/12 (Eighth resolution)

11/10/13

10% of the share capital over a period of 24 months

02/05/11 (Twentieth resolution)

01/07/13

02/05/11 (Twenty-first resolution)

01/07/13

€300 million (shares) (3) €5,000 million (debt securities) (4)

02/05/11 (Twenty-second resolution)

01/07/13

€150 million (shares) (3) (5) €3,000 million (debt securities) (4) (6)

02/05/11 (Twenty-third resolution)

01/07/13

€150 million (shares) (3) (5) €3,000 million (debt securities) (4) (6)

02/05/11 (Twenty-fourth resolution)

01/07/13

15% of the initial issue (3) (4)

02/05/11 (Twenty-fifth resolution)

01/07/13

Capital increases reserved for employees of VINCI and its subsidiaries under Group savings plans

12/04/12 (Ninth resolution)

11/06/14

Capital increases reserved for a specific category of beneficiaries in order to offer employees outside France benefits comparable to those offered to employees who subscribe directly or indirectly through a company mutual fund in a savings plan

12/04/12 (Tenth resolution)

11/10/13

12/04/12 (Eleventh resolution)

11/06/15

1% of the share capital (8) Other conditions (9)

02/05/11 (Twenty-eighth resolution)

01/07/14

0.9% of the share capital (10) Other conditions (11)

Share buy-backs (1) Capital reductions by cancellation of treasury shares Capital increases through capitalisation of reserves, profits and share premiums Issues, maintaining the shareholders’ preferential subscription rights, of all shares and securities giving access to the share capital of the Company and/or its subsidiaries Issues of Océane bonds, while cancelling shareholders’ preferential subscription rights, by the Company and/or its subsidiaries Issue of debt securities other than Océane bonds giving access to the share capital, while cancelling the shareholders’ preferential subscription rights Increase of the amount of an issue if it is over-subscribed Issues of all shares and securities giving access to the share capital to use as consideration for contributions in kind made to the Company in the form of shares or securities giving access to the share capital

Authorisation to allocate existing performance shares Issue of share subscription options

 (2)

10% of the share capital 2% of the share capital (7)

2% of the share capital (7)

1) Except during a public offer period. (2) Total amount of reserves, profits or share premiums arising on issue that may be capitalised. (3) The cumulative nominal amount of share capital increases that may be undertaken by virtue of the Twenty-first, Twenty-second, Twenty-third and Twenty-fourth resolutions adopted by the Shareholders’ General Meeting of 2 May 2011 may not exceed €300 million. (4) The cumulative nominal amount of issues of debt securities that may be undertaken by virtue of the Twenty-first, Twenty-second, Twenty-third and Twenty-fourth resolutions adopted by the Shareholders’ General Meeting of 2 May 2011 may not exceed €5,000 million. (5) The cumulative nominal amount of share capital increases that may be undertaken by virtue of the Twenty-second and Twenty-third resolutions adopted by the Shareholders’ General Meeting of 2 May 2011 may not exceed €150 million. (6) The cumulative nominal amount of issues of debt securities that may be undertaken by virtue of the Twenty-second and Twenty-third resolutions adopted by the Shareholders’ General Meeting of 2 May 2011 may not exceed €3,000 million. (7) The total number of shares that may be issued under the Ninth and Tenth resolutions of the Shareholders’ General Meeting of 12 April 2012 may not exceed 2% of the shares representing the share capital when the Board of Directors takes its decision. (8) The total number of performance shares that may be granted under the Eleventh resolution of the Shareholders’ General Meeting of 12 April 2012 may not exceed 1% of the shares representing the share capital when the Board of Directors takes its decision. (9) Shares are only definitively allocated after a minimum vesting period of two years following their allocation to beneficiaries provided the beneficiaries are still Group employees or company officers at the date of definitive allocation. The number of shares definitively allocated is subject to the condition that, during the two-year vesting period, the VINCI Group’s average return on capital employed (ROCE), after restating for non-controlling interests, is greater than 6% and the number of performance shares finally allocated will depend on this rate: 100% of the performance shares will be allocated if it is greater than 7% and the proportion will be set by linear interpolation if this rate is between 6% and 7%. (10) The total number of options that may be granted under the Twenty-eighth resolution of the Shareholders’ General Meeting of 2 May 2011 may not relate to a number of shares to subscribe exceeding 0.9% of the number of shares making up the share capital. (11) The issue price of the shares may not be less than the average stock market price on the 20 trading days preceding the day of the Board of Directors’ meeting at which the options are granted; the performance conditions attached to the options must include a mechanism that ties the number of options granted to the Group’s intrinsic business performance, reflected in achieving a return on capital employed (ROCE) of at least 5%.

176

Report of the Board of Directors

The authorisations proposed to the Shareholders’ General Meeting of 16 April 2013 are as follows: Date of Shareholders’ General Meeting

Date of expiry

Maximum amount of issue (nominal value)

16/04/13 (Twelfth resolution)

15/10/2014

€2,000 million 10% of the share capital

16/04/13 (Sixteenth resolution)

15/10/2014

10% of the share capital over a period of 24 months

16/04/13 (Seventeenth resolution)

15/06/2015

(2)

Issues, maintaining the shareholders’ preferential subscription rights, of all shares and securities giving access to the share capital of the Company and/or its subsidiaries

16/04/13 (Eighteenth resolution)

15/06/2015

€300 million (shares) (3) €5,000 million (debt securities) (4)

Issues of Océane bonds, while cancelling shareholders’ preferential subscription rights, by the Company and/or its subsidiaries

16/04/13 (Nineteenth resolution)

15/06/2015

€150 million (shares) (3) (5) (7) €3,000 million (debt securities) (4) (6)

Issue of debt securities other than Océane bonds giving access to the share capital, while cancelling the shareholders’ preferential subscription rights

16/04/13 (Twentieth resolution)

15/06/2015

€150 million (shares) (3) (5) (7) €3,000 million (debt securities) (4) (6)

16/04/13 (Twenty-first resolution)

15/06/2015

15% of the initial issue

16/04/13 (Twenty-second resolution)

15/06/2015

10% of the share capital(7)

16/04/13 (Twenty-third resolution)

15/10/2014

2% of the share capital(8)

Share buy-backs(1) Capital reductions by cancellation of treasury shares Capital increases through capitalisation of reserves, profits and share premiums

Increase of the amount of an issue if it is over-subscribed Issues of all shares and securities giving access to the share capital to use as consideration for contributions in kind made to the Company in the form of shares or securities giving access to the share capital of the Company Capital increases reserved for a specific category of beneficiaries in order to offer employees outside France benefits comparable to those offered to employees who subscribe directly or indirectly through a company mutual fund in a savings plan

(1) Except during a public offer period. (2) Total amount of reserves, profits or share premiums arising on issue that may be capitalised. (3) The cumulative nominal amount of share capital increases that may be undertaken by virtue of the Eighteenth, Nineteenth, Twentieth and Twenty-first resolutions adopted by the Shareholders’ General Meeting of 16 April 2013 may not exceed €300 million. (4) The cumulative nominal amount of issues of debt securities that may be undertaken by virtue of the Eighteenth, Nineteenth and Twentieth resolutions adopted by the Shareholders’ General Meeting of 16 April 2013 may not exceed €5,000 million. (5) The cumulative nominal amount of share capital increases that may be undertaken by virtue of the Nineteenth and Twentieth resolutions adopted by the Shareholders’ General Meeting of 16 April 2013 may not exceed €150 million. (6) The cumulative nominal amount of issues of debt securities that may be undertaken by virtue of the Nineteenth and Twentieth resolutions adopted by the Shareholders’ General Meeting of 16 April 2013 may not exceed €3,000 million. 7) The cumulative nominal amount of share capital increases that may be undertaken by virtue of the Nineteenth, Twentieth and Twenty-second resolutions adopted by the Shareholders’ General Meeting of 16 April 2013 may not exceed 15% of the shares representing the share capital when the Board of Directors takes its decision. (8) The total number of shares that may be issued under the Twenty-third resolution adopted by the Shareholders’ General Meeting of 16 April 2013 and the Ninth resolution adopted by the Shareholders’ General Meeting of 12 April 2012 may not exceed 2% of the shares representing the share capital when the Board of Directors takes its decision.

VINCI 2012 Annual Report

Report of the Board of Directors

177

Report of the Statutory Auditors expressing limited assurance on selected social, environmental and societal information At your request and in our capacity as Statutory Auditors of VINCI SA, we hereby present to you our report on the consolidated social and environmental data identified by the symbol þ in the Report of the Board of Directors for the year ended 31 December 2012, prepared in accordance with the provisions of Article L.225-102-1 of the French Commercial Code. Responsibility of the Board of Directors The Board of Directors is responsible for establishing a report that includes the consolidated social and environmental data specified in Article R.225-105-1 of the French Commercial Code (the “Information”), prepared in accordance with the guidelines used by the company (the “Guidelines”), available at its head office and summarised in the Report of the Board of Directors, chapter E, “Social and environmental information”. Independence and quality control Our independence is defined by regulations, the code of ethics for our profession, and the provisions of Article L.822-11 of the French Commercial Code. We have also set up a quality control system that includes policies and documented procedures to ensure compliance with rules of ethics, professional standards and applicable laws and regulations. Responsibility of the Statutory Auditors Our responsibility is to express, based on the procedures performed, an opinion of limited assurance that the quantitative data selected by the VINCI Group, described in the table below and identified by the symbol þ (the “Data”), is fairly presented, in all material respects, in accordance with the Guidelines. Scope

Indicators Period-end workforce Workforce by age bracket Number of women Total recruitment (unlimited term + fixed term + work-study contracts) Total departures of which number of redundancies or dismissals Total hours of training of which environmental training Number of employees trained

Group

Lost-time work accident frequency rate for VINCI employees Work accident severity rate for VINCI employees Occupational illness severity rate Total days of absenteeism Actual hours worked of which overtime Number of disabled employees Average VINCI salary Average VINCI salary for women Number of collective agreements by category Electricity consumption Fossil fuel consumption (natural gas, heavy fuel oil, domestic heating oil, motor fuel) Scope 1 and 2 CO2 emissions

Group, excluding VINCI Construction

Purchased water consumption

Group, excluding Eurovia and VINCI Autoroutes

Percentage of revenue from ISO 14001-certified activities Percentage of ISO 14001-certified revenue (works agencies) ISO 14001-certified tonnage (quarries owned)

Eurovia

ISO 14001-certified tonnage (coating plants owned) ISO 14001-certified tonnage (binder plants owned) Percentage of mix manufactured with recycled mix aggregate Kilometres of ISO 14001-certified motorways (in operation, under construction) Motorway user CO2 emissions

VINCI Autoroutes

Hazardous waste produced Non-hazardous waste produced Purchased de-icing salt Number of noise black spots dealt with during the year

VINCI plc

Total quantity of waste generated by VINCI plc Percentage of waste recycled by VINCI plc

178

Report of the Board of Directors

We were assisted in our work by our Corporate Social Responsibility experts. Nature and scope of our procedures We conducted our procedures in accordance with the International Standard on Assurance Engagements (ISAE) 3000 and with professional standards applicable in France. We carried out the procedures below in order to provide limited assurance that the selected Data identified by the symbol þ contains no material misstatement that would indicate that it is not fairly presented, in all material respects, in accordance with the Guidelines. A higher level of assurance would have required more extensive work. For the selected Data, we performed the following procedures: ˇˇ We assessed the Guidelines with respect to their relevance, completeness, neutrality, understandability, and reliability, taking into account best practices in the industry, if applicable. ˇˇ We verified that the Group has implemented a data collection, compilation, processing and quality control process to ensure the completeness and consistency of the Data. We reviewed the internal control and risk management procedures involved in the preparation of the Data. ˇˇ We conducted interviews with the individuals in charge of social and environmental reporting and performed tests of details, on a sample basis, on the application of the Guidelines in selected entities(*) (the “Entities”). ˇˇ We carried out consistency tests with respect to the consolidation of the Data. The Entities accounted for 21% of the Group’s employees and between 12% and 72% of the Group’s environmental indicators. Conclusion Based on our procedures, nothing has come to our attention that causes us to believe that the Data identified by the symbol þ has not been prepared, in all material respects, in accordance with the Guidelines. Comments on the Data We have the following comments to make on the environmental Data: ˇˇ Reporting processes and tools should be further strengthened for construction activities outside France. ˇˇ VINCI Construction France uses a statistical method to measure its consumption of water, electricity, fuel oil and heating oil. This method should be improved to increase the reliability of the results produced. The Statutory Auditors Paris-La Défense and Neuilly sur Seine, 7 February 2013 KPMG Audit Department of KPMG SA Philippe Arnaud Partner Responsible for the Climate Change & Sustainability Services

Patrick-Hubert Petit Partner

Deloitte & Associés Éric Dugelay Partner Sustainability and Climate Change Services Leader

Alain Pons Partner

(*) Social data: VINCI Concessions: VINCI Park Services Ltd, Meteor Parking Ltd; VINCI Energies: VINCI Facilities IDF Tertiaire, VINCI Facilities IDF Industrie; Eurovia: Eurovia Czech Republic, Eurovia United Kingdom; VINCI Construction: VINCI plc, Dodin Campenon Bernard, SMP CZ and Prumstav, Entrepose Contracting, Entrepose Projets, Horizontal Drilling International, Spiecapag, Freyssinet France, Advitam, FIS, Freyssinet International & Cie, SBF Rueil, VINCI Construction Grands Projets. Environmental data: VINCI Autoroutes: ASF DRE Agen, ASF DRE Brive, ASF DRE Valence; VINCI Energies: VINCI Energies France Sud-Ouest Méditerranée Antilles Guyane, VINCI Energies France Normandie, VINCI Energies France PTE, VINCI Energies International Benelux; Eurovia: Eurovia Ile de France Haute Normandie, Eurovia Quebec, Eurovia Germany; VINCI Construction: VINCI Construction France Direction Déléguée Est, VINCI Construction France Direction Déléguée Ouest, five VINCI Construction France mobile sites (Chantiers Archipel Habitat, Carré Feydeau, Tour Descartes, Saint-Honoré, Hydraulique DD Est), VINCI Construction Grands Projets Hallandsas, VINCI Construction Grands Projets Métro du Caire, VINCI Construction Grands Projets Crossrail 510, VINCI plc Tottenham Court Road, VINCI plc Streatham Hub, VINCI plc Connaught Tunnel and Surface Railway Works, VINCI plc Victoria Station Upgrade. This is a free translation into English of the Statutory Auditors’ report issued in French and it is provided solely for the convenience of English-speaking users. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France. In the event of a legal dispute, the French version shall prevail.

VINCI 2012 Annual Report

179

Report of the Chairman

Report of the Chairman of the Board on corporate governance and internal control procedures In accordance with Article L.225-37 of the French Commercial Code, the objective of this report of the Chairman of the Board of VINCI is to give an account of the composition of the Board of Directors, the application of the principle of equal representation of men and women on the Board, how the Board’s work is prepared and organised, and the internal control and risk management procedures the VINCI Group has put in place. This report was prepared by the Chairman in liaison with the Company’s Finance Department (the Audit Department being included therein) and Legal Department. The “Corporate governance” section of this report was submitted to the Appointments and Corporate Governance Committee. The “Internal control and risk management procedures” section was prepared with the input of the VINCI Group’s business lines and divisions. The required information was gathered from key personnel responsible for internal audit and risk management procedures. This section of the report was submitted for approval to the Audit Committee. This report was approved by the Board of Directors at its meeting of 5 February 2013.

A. Corporate governance 1.

Reference to the Afep-Medef code of corporate governance At its meeting of 13 November 2008, the Board of Directors of VINCI decided that the Company would, as from financial year 2008, use the Afep-Medef code as a frame of reference for preparing the report required by Article L.225-37 of the French Commercial Code. This corporate governance code may be consulted in full on the Medef website (www.medef.com). The following criteria or recommendations of this code have been set aside:

2.

Criterion/recommendation set aside

Reason

A Director is not considered independent if he/she has held his/her position for more than 12 years.

The Group’s significant assets relate to multi-year contracts that are in effect over a long period of time, sometimes several decades (concessions and public-private partnerships). Board members must have sufficient perspective on these activities. The individuals affected by this criterion are fully independent in their judgement.

A Director is not considered independent if he/she is a company officer of a subsidiary.

Provided the Board member in question is otherwise considered independent, the Board believes that the fact that he/she holds the position of (non-executive) Director of a subsidiary is a strength, and that this situation does not make him/her less independent in his/her judgement.

An executive may only receive a termination benefit if the departure from the company is imposed and due to a change in control or strategy.

In May 2010, the Company made a commitment to its Chairman and Chief Executive Officer to pay a benefit in the event the Board terminated his appointment, regardless of the reason. However, the Board has made payment of this benefit subject to performance criteria.

The Board’s assessment must measure the contribution of each member of the Board.

There is no formalised system for measuring the individual contribution of each Board member. All of the members of the Board approved of the collegial manner in which the Board functions. This can only result from positive individual contributions.

Executive Management structure On 6 May 2010, shareholders renewed Mr Huillard’s appointment as a member of the Board. The Board then decided to combine the functions of Chairman of the Board and Chief Executive Officer. The Board believed – and continues to believe – that this decision, announced in November 2009, represents the most appropriate choice for the Group because i) its operational structure demands it, with Executive Management of a listed holding company supported by structured businesses, Concessions and Contracting, ii) it wanted to unify the Group’s top-level representation vis-à-vis third parties so as to clarify it and make the Group more responsive. The Board believes that the Group’s solid performance over the last two years, in a tough economic environment, has confirmed the soundness of its decision. Chairman and Chief Executive Officer Xavier Huillard, Chairman and Chief Executive Officer: ˇˇ organises and directs the work of the Board and reports thereon to shareholders at the Shareholders’ General Meeting. He ensures the proper functioning of the various corporate bodies and committees and, in particular, ensures that the Directors are able to fulfil their responsibilities; ˇˇ has the broadest powers to act in all circumstances in the Company’s name. He exercises these powers within the limits of the corporate purpose, subject to the powers that the law attributes expressly to shareholders and to the Board of Directors, and in accordance with the Board’s internal rules. He represents the Company in its dealings with third parties and is responsible for overall operational management of the Group.

180

Report of the Chairman

He provides the Board and its committees with the information they need, reports on the highlights of the Group’s operations over the period and implements the Board’s decisions. The Board’s internal rules require the Company’s material transactions, referred to in paragraph 3.3 below, to be subject to prior approval by the Board. In addition, the Chairman and Chief Executive Officer regularly presents the Group’s performance, prospects and strategy to the financial community, in particular through road shows. Mr Huillard chairs the Executive Committee and the Management and Coordination Committee. The Executive Committee had 13 members as of the date of this report. It met 22 times in 2012, with an average of two meetings per month. The Management and Coordination Committee is composed of the members of the Executive Committee and the Group’s main operational and functional executives. Its purpose is to ensure broad consultation on VINCI’s strategy and position as well as on cross-cutting policies within the VINCI Group. This committee has 35 members and met four times in 2012. Mr Huillard also chairs the Risk Committee mentioned in paragraph 4.3 of part B with powers to delegate this function. Vice-Chairman and Senior Director of the Board Yves-Thibault de Silguy was named Vice-Chairman and Senior Director of the VINCI Board on 6 May 2010. Mr de Silguy was previously Chairman of the Board (from 2006 to 2010), and he proposed that the Board change its system of corporate governance by creating a new Senior Director function with real prerogatives, set out in the Board’s internal rules. The Board approved his proposal unanimously. The Senior Director has an outstanding level of information about the Group and how it operates and also enjoys specific powers that are specified in the Board’s internal rules and restated in the Report of the Vice-Chairman and Senior Director on page 194 of this report. These factors ensure the system’s efficiency. Mr de Silguy cannot be considered an “independent Director” as defined by the Afep-Medef code because he held the position of Chairman of the Board between 2006 and 2010. Nevertheless, the Board considers that his exceptional knowledge of the Group by virtue of his previous position, the information from which he will continue to benefit, as specified in the internal rules, and his availability constitute sufficient reason to assign the position to him. Mr de Silguy reports on his activity to the Remuneration Committee in the form of a detailed written report. Mr de Silguy: ˇˇ devotes part of his time to remaining up to the minute on the Group’s news and events through regular meetings with the Group’s principal operational and functional executives; ˇˇ assists the Chairman and Chief Executive Officer, as part of the company’s corporate governance arrangements, in organising the work of the Board and its committees; ˇˇ provides the Board with his insights on transactions it will have to consider, supplementing the activity of the Board committees, and ensures the proper functioning of governance bodies on behalf of the Board; ˇˇ calls a meeting of the Directors once a year, without the Chairman and Chief Executive Officer being present. Mr de Silguy also chairs the Appointments and Corporate Governance Committee and the Strategy and Investments Committee. He takes part in numerous meetings with individual shareholders. Lastly, Mr de Silguy assists the Chairman and Chief Executive Officer and the executives of the Group’s numerous subsidiaries, at their request, in high-level representation vis-à-vis governmental authorities and major customers and business partners in France and abroad. This support is governed by a services agreement approved by shareholders at the Shareholders’ General Meeting of 6 May 2010. The Board of Directors is careful to ensure that this contract does not give rise to a conflict of interest or weaken the role of Senior Director that has been separately assigned to Mr de Silguy. To this end, his remuneration is a fixed, non-adjustable sum and the agreement’s execution is reviewed every year by the Audit Committee, on the basis of a detailed written report. Acting on the advice of the Audit Committee, which conducts an annual review of Mr de Silguy’s activity report, the Board considers that the continuing performance of this agreement is useful for the Group and that the remuneration paid is consistent with the services provided.

3. 3.1

The Board of Directors Composition of the Board of Directors – Independence of members

At the date of this document, the Board of Directors has 13 members, including one member representing employee shareholders. In 2012, shareholders renewed the term of Jean-Pierre Lamoure as Director. Dominique Bazy decided not to seek re-election to his position upon expiration of his term at the end of the Shareholders’ General Meeting of 12 April 2012. At the Shareholders’ General Meeting of 16 April 2013, shareholders will be asked to vote on the renewal of the term of Michael Pragnell as Director and the appointment of two new Directors. In addition, the terms of office of François David and Patrick Faure will expire at the end of this Annual Shareholders’ General Meeting. Since the Shareholders’ General Meeting of 12 April 2012, the percentage of women on the Board has been 15.4%. The Board aims to comply, within the specified time frame, with Law no. 2011-103 of 27 January 2011 concerning the balance between men and women on Boards of Directors and Supervisory Boards and concerning equal status for men and women. At the Shareholders’ General Meeting of 16 April 2013, shareholders will be asked to appoint Ms Yannick Assouad and Ms Graziella Gavezotti to the Board of Directors. Approval of the corresponding resolution will lift the percentage of women on the Board to 30.8%, thereby putting the Board in early compliance with the law and the AfepMedef code. Furthermore, subject to approval of the resolutions on the renewal and appointment of Directors by the Shareholders’ General Meeting, three of 13 Board members will not have French citizenship.

VINCI 2012 Annual Report

Report of the Chairman

181

The term of office of Directors is four years. The Directors’ terms of office expire at different times, such that approximately one-quarter of the Board is renewed every year. The Company’s Articles of Association provide that no one may be appointed or re-appointed as a Director after reaching the age of 75 and that no more than one-third of the Directors in office at the close of the financial year for which shareholders are asked to approve the financial statements may be over 70. At its meeting of 5 February 2013, the Board also made an assessment of the current Directors’ independence, as required by the Afep-Medef code and in accordance with the criteria of that code. For the purpose of evaluating the independence of VINCI’s Directors, the Board decided to exclude the code’s 12-year seniority criterion for the reasons explained in paragraph A.1 above. Although certain VINCI Board members may be customers or suppliers of companies having business relationships with the Group, the Board has determined that, given the business of the Group and because business relationships between the companies in the Group and their industrial partners are highly dispersed, there is no significant flow of business requiring special surveillance and that might give rise to conflicts of interest. Concerning relationships with its partner banks, the Board examined the individual situation of the Director who has had responsibilities in the banking sector, and concluded that no conflict of interest has been identified over the last five years and that he has full independence of judgement. After receiving the report of the Appointments and Corporate Governance Committee, the Board examined the situation of each Board member and reached the following conclusions: Directors who cannot be considered independent Xavier Huillard, Chairman and Chief Executive Officer; ˇˇ Yves-Thibault de Silguy, Vice-Chairman and Senior Director. This evaluation is based on the fact that Mr de Silguy was Chairman of the Board of Directors from 2006 to 2010 and that he holds a services contract with the company. The Board has noted, however, that the execution and payment terms of this contract and the fact that Mr de Silguy is currently drawing a pension ensure that he has considerable independence of judgement; ˇˇ Elisabeth Boyer, Director representing employee shareholders. This evaluation was based on the fact that Ms Boyer is an employee of Cofiroute, a subsidiary of VINCI. The Board nevertheless noted that Ms Boyer is a member of an employee representative body, giving her protection that could enable her to be considered an independent Director under the European Commission Recommendation 2005/162/ EC of 5 February 2005; ˇˇ Jean-Pierre Lamoure. This evaluation was based on the fact that Mr Lamoure was an employee of Soletanche Freyssinet, a wholly owned subsidiary of VINCI. The Board of Directors has noted, however, that Mr Lamoure no longer performs any operational functions within the VINCI Group. ˇˇ

Directors who can be considered independent The Board of Directors believes that the following members of the Board are independent. It believes that even if some of them do not meet certain criteria set out by the Afep-Medef code, the judgement of these individuals is completely independent, ensuring that they can carry out their remit in a fully independent manner. ˇˇ Robert Castaigne. The Board has taken into account the fact that until May 2008 Mr Castaigne was Chief Financial Officer and member of the Executive Committee of the Total Group, with which the VINCI Group has normal business relationships involving fuel purchase contracts or construction projects, for example. The Board believes that these factors do not alter Mr Castaigne’s independence of judgement. ˇˇ François David. Mr David is Chairman of Coface. The Board believes, however, that the normal commercial relationships that might exist between the Coface Group and the VINCI Group (e.g. insurance policies for contracts entered into by VINCI subsidiaries abroad) do not alter Mr David’s independence of judgement. ˇˇ Patrick Faure. The Board noted that Mr Faure has been a Director of VINCI since 1993, i.e. more than 12 years, and that he sits on the Board of Cofiroute, a company controlled by VINCI. The Board believes, however, that Mr Faure’s directorship at Cofiroute does not alter his independence of judgement. On the contrary, the Board believes this constitutes an advantage inasmuch as Mr Faure has useful experience in motorway concessions from which the other members of the Board can benefit. ˇˇ Dominique Ferrero. The Board considers that Mr Ferrero no longer has an operational role within the Natixis Group. The Board took into consideration Mr Ferrero’s statements, according to which his functions did not give rise to any conflict of interest in 2012. ˇˇ Jean-Bernard Lévy. The Board considers that the normal business relationships that exist between the Thales Group, of which Mr Lévy became the Chairman and CEO on 20 December 2012, and certain VINCI Group companies do not alter Mr Lévy’s independence of judgement. ˇˇ Michael Pragnell held management responsibilities within Syngenta AG until 2007. This company has no business relationship with the VINCI Group. ˇˇ Henri Saint Olive. Mr Saint Olive is Chairman of Banque Saint Olive, which might enter into transactions with the Company or its subsidiaries or into private transactions with executives thereof. The Board believes, however, that such transactions do not alter Mr Saint Olive’s independence of judgement. ˇˇ Pascale Sourisse. Ms Sourisse has management responsibilities within the Thales Group. The Board believes, however, that the normal business relationships that may exist between the Thales Group and certain companies in the VINCI Group do not alter Ms Sourisse’s independence of judgement; ˇˇ Qatari Diar Real Estate Investment Company. The Board noted that the Qatari Diar Group held less than 6% of the share capital and voting rights of VINCI, acquired when the Cegelec Group was sold to VINCI. In addition, the Board noted that VINCI Construction Grands Projets, a wholly owned subsidiary of VINCI, and Qatari Diar are partners in the Qatari-law company Qatari Diar VINCI Construction (QDVC). This company, 51%-owned by Qatari Diar, is involved in developing construction activities in Qatar and elsewhere in the Middle East. Abdul Hamid Janahi has been the permanent representative of Qatari Diar on the Board of VINCI since 29 November 2012. The Board believes, however, that the information presented above does not affect Mr Hamid Janahi’s independence of judgement as a member of the Board of VINCI. 

182

Report of the Chairman

As a result of this evaluation, the Board of Directors considers that nine of its 13 members, i.e. more than half, qualify as independent. The Board has also examined the situations of Ms Yannick Assouad and Ms Graziella Gavezotti, whose appointments to the Board will be proposed to shareholders at their General Meeting on 16 April 2013, and considers that they meet all the criteria qualifying them as independent. In view of the expiry of the terms of Mr David and Mr Faure, and if the two aforementioned candidates are appointed as Directors by the Shareholders’ General Meeting, nine Directors out of 13 can be considered at that point as independent.

3.2

3.3

Personal situation of company officers

As of the date this document was prepared and to the best of the Chairman’s knowledge: ˇˇ there are no family links between any of VINCI’s company officers; ˇˇ none of VINCI’s company officers had been found guilty of fraud in the last five years; ˇˇ none of these individuals has been involved as a company officer in a bankruptcy, sequestration of assets or liquidation during the last five years and none has been incriminated or officially punished by a statutory or regulatory authority. None has been disqualified by a Court from serving as a member of a Board of Directors or company management or supervisory body of a securities issuer, nor from being involved in the management or conduct of the affairs of a securities issuer in the last five years; ˇˇ no company officer of VINCI had declared a conflict of interest in respect of any decisions taken by the Board of Directors in 2012.

The Board of Directors’ internal rules

In May 2003, the Board of Directors adopted a set of internal rules. The most recent version came into effect on 6 May 2010 when the Board decided to combine the functions of Chairman and Chief Executive Officer. This document specifies the rules applicable to the Board and its committees, and it includes rules of ethics detailing the standard of conduct expected of each Director. The internal rules may be consulted in full on the Company’s website (www.vinci.com). The internal rules of the Board of Directors specifically require the Board to examine and approve, prior to implementation: ˇˇ strategic transactions carried out by the Company and, more generally, by the Group; ˇˇ strategic investment projects and any transaction, in particular acquisitions and divestments, in excess of €200 million; ˇˇ transactions falling outside of the Company’s announced strategy and any transaction brought to its attention by its Strategy and Investments Committee. The internal rules of the Board of Directors also require that Board members be kept informed at all times of the Company’s financial condition, cash position and commitments, and of all significant events and transactions related to the Company. They may request information about specific subjects and they may meet with the Company’s principal executives, if necessary, whether or not the company officers are present, so long as the Chairman is notified in advance. Lastly, the internal rules specifically define the powers and prerogatives of the Vice-Chairman and Senior Director. These include the right to call a meeting of the Board at any time and without a particular agenda, to add any item to the agenda, to call a meeting of the members of the Board or to meet with the members of the Executive Committee without the Chairman and Chief Executive Officer being present.

3.4 3.4.1

Conditions of preparation and organisation of the work of the Board Functioning and work of the Board of Directors in 2012

The Board of Directors met nine times in 2012 and the average attendance rate at its meetings was 90%. The Board of Directors discussed all matters of importance relating to the Group’s activities. The Executive Vice-President and Chief Financial Officer attends Board meetings. The General Counsel acts as Board Secretary. In respect of the financial statements and day-to-day management of the Company, the Board: ˇˇ examined and approved the annual consolidated and parent company accounts for financial year 2011 together with the half-yearly 2012 consolidated and parent company accounts; ˇˇ examined the budget for 2013; ˇˇ approved the terms of the various reports to shareholders, prepared and called the Shareholders’ General Meeting of 12 April 2012, approved the agenda and the resolutions submitted for shareholder approval and approved the Report of the Chairman on corporate governance and internal control procedures; ˇˇ took note of the work of the Audit Committee and the Strategy and Investments Committee; ˇˇ regularly examined the Group’s business activities, on-going developments, financial situation, plans and indebtedness; ˇˇ decided to pay an interim dividend on 2012 earnings; ˇˇ examined the evolution of the share capital and the share buy-back programme; ˇˇ increased the limit of the Euro Medium Term Notes programme; ˇˇ approved the renewal of the Chairman and Chief Executive Officer’s powers regarding guarantees and collateral; ˇˇ renewed a delegation of power to the Chairman and Chief Executive Officer to issue bonds. Regarding corporate governance and remuneration, the Board: altered the composition of the Remuneration Committee following the non-renewal of Dominique Bazy’s term as Director; ˇˇ took note of the work of the Remuneration Committee and the Appointments and Corporate Governance Committee; ˇˇ evaluated the independence of its members with regard to the criteria of the Afep-Medef code, proposed the renewal of the term of a Director and the appointment of a new Director; ˇˇ

VINCI 2012 Annual Report

Report of the Chairman

183

set the amount to be recognised in the financial statements for the second year during which Mr Huillard’s long-term incentive plan is in effect; ˇˇ set Mr Huillard’s variable remuneration for financial year 2011; ˇˇ approved the tentative work programme of the Board of Directors for 2013; ˇˇ proposed the introduction of a share subscription option plan and performance share plan for Group executives and employees; ˇˇ voted on the definitive number of performance shares and share subscription options under the 2010 plan, in light of the performance actually achieved; ˇˇ examined the calculation of the performance conditions for the long-term incentive plans (share option subscription and performance share plans and long-term incentive plan of the Chairman and Chief Executive Officer) in view of the intended acquisition of the ANA Group in Portugal. ˇˇ

Regarding employee savings plans, the Board: set the subscription price of shares to be issued under the French employee savings plan for the periods from 2 May to 31 August 2012, from 3 September to 31 December 2012 and from 2 January to 30 April 2013; ˇˇ examined a proposed international employee share purchase plan and delegated powers for a capital increase; ˇˇ examined the proposal for the introduction of a fund invested in bonds under the French employee savings plan. ˇˇ

In addition, the Board: took note of the work of the Strategy and Investments Committee; ˇˇ examined the plan to acquire the airport operator ANA in Portugal and various other acquisition projects, examined and finalised its responses to shareholders’ written questions; ˇˇ approved guarantees; ˇˇ examined the Group’s policy in respect of security; ˇˇ approved VINCI’s sale of Cegelec Entreprise securities to VINCI Energies and examined VINCI Energies’ capital increase; ˇˇ examined the Group’s business activities in Ukraine. ˇˇ

One of the Board meetings was held in Kiev, Ukraine in October 2012, and visits were organised to some of the Group’s projects in the country on that occasion (in particular the confinement shelter at the Chernobyl nuclear power plant).

3.4.2

The Board committees

The responsibilities and modus operandi of the committees are governed by the internal rules of the Board of Directors. Each committee has a role to play in analysing and preparing the Board discussions falling within its field of competence and in studying topics and/or projects that the Board or its Chairman may submit to it for review. It has consultative powers and acts under the authority of the Board, of which it is an extension and to which it is accountable. Minutes of each committee meeting are drawn up and circulated to the members of the Board of Directors. The Audit Committee Terms of reference The Audit Committee helps the Board monitor the accuracy and fair presentation of VINCI’s parent company and consolidated financial statements and the quality of the information provided. In particular, its duties are to monitor: the process of compiling financial information: examine the Group’s annual and half-yearly parent company and consolidated financial statements before they are presented to the Board, satisfy themselves that the accounting policies and methods are appropriate and consistently applied, warn against any non-compliance with these rules and monitor the quality of the information given to the shareholders; ˇˇ the effectiveness of the Group’s internal control and risk management systems: (a) concerning internal control procedures, assess subsidiaries’ internal control systems with the managers of the internal control function and more particularly the internal audit plan, the conclusions of internal audits, the recommendations issued and the resulting follow-up action; (b) concerning risk management, regularly review the Group’s financial situation and main financial risks and in particular its off-balance sheet commitments; ˇˇ the auditing of the parent company and consolidated financial statements by the Statutory Auditors and the independence of the Statutory Auditors: examine the Statutory Auditors’ work programmes, conclusions and recommendations with them, as well as follow-up action taken; verify compliance with the Statutory Auditors’ obligation to be independent, assess proposals on the appointment of the Company’s Statutory Auditors, on the renewal of their terms of office as well as their remuneration, and issue a recommendation on this matter; ˇˇ the Group’s policy in respect of insurance; ˇˇ the setting up of procedures regarding business ethics and competition and ensure that there is a system for verifying that they are enforced. ˇˇ

To carry out its remit, the Board’s internal rules specify that the Audit Committee may seek external advice, the cost of which is borne by the Company. Composition The Audit Committee comprises at least three Directors designated by the Board. The Executive Vice-President and Chief Financial Officer and the Statutory Auditors attend Audit Committee meetings. Since 14 May 2009, this committee has been composed of Henri Saint Olive (Chairman), Robert Castaigne, Michael Pragnell and Pascale Sourisse. The Board considers all four members to be independent Directors. By virtue of their professional experience and/or qualifications, the members of the Audit Committee have the financial and accounting expertise necessary to serve thereon. Their experience and qualifications are described in the curriculum vitae set out in the Report of the Board of Directors on page 127 of the 2012 annual report. The Executive Vice-President and Chief Financial Officer acts as secretary to the committee.

184

Report of the Chairman

Activities in 2012 The Audit Committee met four times in 2012, with a participation rate of 100%. The Audit Committee meets at least two days before the Board meeting called to approve the annual and half-yearly financial statements. Audit Committee meetings dealt with the following subjects: the process of compiling accounting and financial information: review of the Group’s financial statements, budget updates, cash positions and financial debt, the Group’s financial strategy and on-going financial transactions; the Fast Close project to shorten the lead time for producing and publishing consolidated financial statements; ˇˇ the effectiveness of the Group’s internal control and risk management systems: post-mortem review of difficult contracts in Contracting’s three business lines, the results of the annual self-assessment LSF 2012, presentation of VINCI Finance International, the “risk factors” chapter of the Report of the Board of Directors; review of on-going disputes and litigation; review of ethics procedures in place; ˇˇ statutory auditing of annual and consolidated financial statements: discussions with the Statutory Auditors and review of their conclusions; adherence to legal and regulatory obligations concerning accounting and financial information; the Group’s tax situation; changes to IFRSs; ˇˇ independence of the Statutory Auditors: review of the Statutory Auditors’ statement of independence; fees paid to the Statutory Auditors’ network; information on the services rendered that were directly connected to the assignment; ˇˇ proposal to renew for six years the term of office of the Statutory Auditors whose term expires in 2013. ˇˇ

In addition, the committee examined the services provided under the services agreement with YTSeuropaconsultants, of which Mr de Silguy is the sole shareholder. For the purposes of this work, the following executives were interviewed: the Executive Vice-President and Chief Financial Officer, the Senior Vice President, Corporate Controlling and Accounting, the Director of Treasury and Financing, the Chief Audit Officer, the General Counsel and the Statutory Auditors. During their presentation, the Statutory Auditors emphasised the important points and the accounting options chosen. The Strategy and Investments Committee Terms of reference This committee helps the Board review the Group’s overall strategy. It examines proposed strategic investments and all transactions, including investments and divestments, that could have a material impact on the Group’s scope of consolidation, business activities, risk profile, earnings or balance sheet or on the Company’s share price. It carries out its reviews before these transactions are presented to the Board. In particular its duties are to: examine the Group’s three-year plan; ˇˇ prepare the Board’s discussions on the Group’s strategy; ˇˇ formulate an opinion, for the benefit of the Executive Management, on proposed acquisitions or disposals of shareholdings of a value exceeding €50 million that do not come under the Board’s direct terms of reference; ˇˇ give its opinion to the Executive Management on plans for significant change to the Group’s legal or operational structure. ˇˇ

In addition, the Executive Management informs the committee on progress in multi-year projects that entail a total investment by the VINCI Group in equity and debt of more than €100 million. Composition The Strategy and Investments Committee comprises at least three Directors designated by the Board. From 2 May 2011 to 29 November 2012, the permanent members of the committee were Yves-Thibault de Silguy (Chairman), Elisabeth Boyer, Jean-Pierre Lamoure and Yousuf Ahmad Al Hammadi (the permanent representative of Qatari Diar Real Estate Investment Company). Since 29 November 2012, the committee has been composed of Yves-Thibault de Silguy (Chairman), Elisabeth Boyer, Jean-Pierre Lamoure and Abdul Hamid Janahi (the new permanent representative of Qatari Diar Real Estate Investment Company). The committee is open to all Board members wishing to participate. A dossier is systematically sent to them before each meeting. The Chairman and Chief Executive Officer, the Executive Vice-President and Chief Financial Officer, and the Vice-President, Business Development of VINCI attend the meetings of the Strategy and Investments Committee. The Board Secretary acts as secretary to the committee. Activities in 2012 The Strategy and Investments Committee met five times in 2012, with an average participation rate of 80%. Voluntary participation in the committee’s work on the part of directors who were not committee members was 49% in 2012 (vs. 42% in 2011). During the year the committee examined: investment or acquisition projects in companies based abroad, in particular in Europe, North America, the Middle East and Asia. Specific projects included the acquisitions of ANA, the Portuguese airport operator, EVT in Germany and Carmacks in Canada; ˇˇ public-private partnerships or infrastructure concessions, in particular in the rail, motorway, airport and sports sectors in France and abroad. ˇˇ

The Remuneration Committee Terms of reference The Remuneration Committee proposes the terms and conditions of company officers’ remuneration to the Board of Directors. Its duties are to: make recommendations to the Board concerning the remuneration, pension and welfare benefit plans, benefits in kind and miscellaneous pecuniary rights, including any performance shares or share subscription or share purchase options granted to the company officers and to salaried members of the Board, if any; ˇˇ propose to the Board an overall package of performance shares and/or subscription or purchase options on the Company’s shares and the general and specific conditions applicable to these allocations; ˇˇ

VINCI 2012 Annual Report

ˇˇ ˇˇ

Report of the Chairman

185

express an opinion on the Executive Management’s proposals regarding the number of beneficiaries; propose to the Board an aggregate amount of Directors’ fees and the manner of their allocation.

In addition, the Remuneration Committee is informed of the remuneration policy applicable to the principal executives. Composition The Remuneration Committee comprises at least three Directors designated by the Board. Until 12 April 2012, it was composed of Jean-Bernard Lévy (Chairman), Dominique Bazy and François David. Since 12 April 2012, the Remuneration Committee has been composed of Jean-Bernard Lévy (Chairman), Robert Castaigne and François David. The Board recognises all members of the committee as independent. The Vice-President responsible for Human Resources and Corporate Social Responsibility attends the meetings of the Committee. The Chairman and Chief Executive Officer also attends the Committee’s meetings except when the Committee examines questions relating personally to him. The Board Secretary acts as secretary to the Committee. Activities in 2012 The Remuneration Committee met four times in 2012, with a participation rate of 85%. The Committee examined and made proposals to the Board regarding: determination of the variable portion of Mr Huillard’s remuneration for 2011; ˇˇ calculation of the annual amount to be set aside for Mr Huillard’s long-term incentive programme; ˇˇ performance share and share subscription option plans for 2012 and 2013; ˇˇ the results of the international employee share purchase plan; ˇˇ the performance conditions for the long-term incentive plans, proposing to exclude the ANA Group from the scope of calculation of ROCE should this transaction be finalised; ˇˇ the renewal of the resolutions enabling capital increases reserved for employees; ˇˇ the business reports of Yves-Thibault de Silguy (one for his role as Vice-Chairman and Senior Director, the other for the services provided under the services agreement with YTSeuropaconsultants). ˇˇ

The Chairman and Chief Executive Officer attended and participated in several Committee meetings (except for items concerning him personally). The Appointments and Corporate Governance Committee Terms of reference This committee: ˇˇ ensures adherence to corporate governance rules; ˇˇ prepares the Board’s discussions on the assessment of the Company’s Executive Management; ˇˇ examines, on a consultative basis, the Executive Management’s proposals relating to the appointment and dismissal of the Group’s principal executives; ˇˇ is informed of the Executive Management’s policy for managing the Group’s senior executives and in this regard, the Committee examines the procedures for succession plans; ˇˇ makes proposals on the selection of Directors; ˇˇ examines all candidacies for Board membership and expresses an opinion or recommendation to the Board on those candidacies; ˇˇ discusses, every year, the issue of independence of Board members; ˇˇ prepares, in a timely manner, recommendations and opinions on the appointment or succession to the posts of executive company officers. Composition The Appointments and Corporate Governance Committee comprises at least three Directors designated by the Board. Since 6 May 2010, it has been composed of Yves-Thibault de Silguy (Chairman), Patrick Faure and Dominique Ferrero. The Board recognises two of the three members of the Committee as independent. The Chairman and Chief Executive Officer attends the Committee’s meetings except when it evaluates the Executive Management. The Board Secretary acts as secretary to the Committee. Activities in 2012 The Committee met four times in 2012, with an attendance rate of 100%. The Committee: considered Directors’ terms of office expiring in 2012 and 2013; ˇˇ hired an external consultant to find new Directors; ˇˇ examined the percentage of women on the Board and implementation of Law no. 2011-103 of 27 January 2011 concerning the balance of men and women on Boards of Directors;  ˇˇ performed an assessment of the Executive Management; ˇˇ assessed each Board member with regard to the independence criteria of the Afep-Medef code and made proposals to the Board; ˇˇ examined the report of the Chairman of the Board on corporate governance; ˇˇ examined the assessment of the Group’s Senior Executives; ˇˇ examined the results of the Executive Review conducted in 2012.  ˇˇ

3.5

Assessment of the composition and functioning of the Board of Directors

In application of the Board of Directors’ internal rules, each year, the agenda of one meeting includes a discussion on the functioning of the Board with the aim of improving its effectiveness. In addition, a formal assessment is performed every three years. This exercise may be supervised by a Director, with the assistance of an external consultant.

186

Report of the Chairman

During its meeting of 7 February 2012, following the proposal of the Appointments and Corporate Governance Committee, the Board of Directors considered that it was not yet necessary to carry out another assessment because (i) the most recent formal assessment of the Board had been performed at the end of 2010 with the help of an external consultant, and (ii) the Board had considered this assessment in March and July 2011 and again in October 2011, following the meeting of committee chairmen on 20 September 2011, during which it was agreed that all the identified avenues for improvement had been acted upon. During its meeting of 5 February 2013, the Board decided that an external assessment would be carried out in the second half of 2013.

4. Principles and rules for determining company officers’ remuneration and benefits of whatever nature 4.1

Remuneration and benefits of the executive company officer

The remuneration of the executive company officer is set by the Board of Directors, acting on a proposal from the Remuneration Committee. Xavier Huillard On 6 May 2010, the Board of Directors confirmed the decisions taken on 3 March 2010 concerning Mr Huillard’s remuneration and benefits from the time of his appointment as Chairman and Chief Executive Officer until the end of his term. During the meetings of 12 April 2012 and 5 February 2013, the Board set the following terms for his remuneration: ˇˇ fixed annual remuneration of €900,000, valid for the duration of Xavier Huillard’s term of office, it being specified that this remuneration only came into effect on 1 January 2011, at Mr Huillard’s request; ˇˇ a two-part variable remuneration plan, ranging from 0 to €1,440,000, or 0-160% of the fixed portion, depending on performance achieved. The first part is based on three economic ratios (net earnings per share, operating income per share and free cash flow). The second part is managerial and based on performance against qualitative criteria as defined by the Board. For the first part, the quantitative target level expected to be achieved is linked to the specific method of the calculation formula, such that any increase in remuneration is dependent on an improvement in the performance ratios from one year to the next; ˇˇ a long-term incentive plan, allowing for a capital allowance to be built up gradually, variably, and based on specific performance objectives. Except in certain specific cases, incentive plan awards will vest only if the beneficiary completes his term of office. Under this incentive plan, an amount equivalent to (a) 16,600 times the value of the VINCI share, provided that ROCE exceeds 6% (9% starting from the 2012 financial year), and (b) 41,500 times the increase in the VINCI share price over a one-year period, provided that the VINCI share outperforms a peer group comprising at least 10 European construction and infrastructure concession companies by at least 5%, is to be granted to Mr Huillard for each of the four years of his term of office. In the event of lesser performance, the amount of the annual allocation under (a) will be reduced and will be equal to zero if ROCE is less than 5% (8% starting from the 2012 financial year), and the allocation under (b) will be reduced to zero if the VINCI share underperforms the peer group by more than 5%. Starting from the 2013 financial year, the scope of calculation for ROCE will be restated to exclude the ANA Group; ˇˇ Mr Huillard is deemed to have the status of a senior executive, thereby entitling him to benefit from the additional supplementary pension plan established for senior executives of VINCI SA and mentioned in paragraph D.3.2 of the Report of the Board of Directors, page 133, as well as from the Group’s welfare benefits plans. The commitment with regard to the supplementary pension plan was approved by shareholders at the 6 May 2010 Shareholders’ General Meeting and the benefit of this supplementary pension plan was taken into account in determining Mr Huillard’s overall remuneration; ˇˇ Mr Huillard is eligible for severance pay in the event that the Company terminates his appointment as Director prior to its normal expiry (at the end of the Shareholders’ General Meeting called to approve the financial statements for the year ending 31 December 2013). This commitment is limited to 24 months of his remuneration and subject to performance conditions based on the same criteria as those used in the calculation of the quantitative part of his variable remuneration. Severance pay shall be equal to 24 months if average performance is at least equal to 130% of the objective and nil if average performance is less than or equal to 70% of the objective. This commitment was approved by shareholders at the 6 May 2010 Shareholders’ General Meeting. Mr Huillard has not benefited from the share subscription options and performance shares incentive plan approved by the Board of Directors at its meeting of 12 April 2012.

4.2

Remuneration and benefits of the Vice-Chairman and Senior Director

The remuneration of the Vice-Chairman and Senior Director is set by the Board of Directors, acting on a proposal by the Remuneration Committee. Yves-Thibault de Silguy Mr de Silguy receives Directors’ fees in his capacity as Vice-Chairman and Senior Director, calculated as described in paragraph 4.3. On 3 March 2010, the Company signed a services agreement with YTSeuropaconsultants, of which Mr de Silguy is the sole shareholder. This agreement was authorised by the Board of Directors and approved by shareholders at the 6 May 2010 Shareholders’ General Meeting. The agreement covers the provision of services as described in paragraph A.2 on page 180, with oversight by the Audit Committee, in return for an annual flat fee of €330,000 (ex. VAT) and has a duration of one year, renewable automatically. This agreement was renewed automatically in 2011 and 2012 for a new term of one year. At its meeting of 5 February 2013, the Board of Directors decided to seek approval for the automatic renewal of this agreement from the Shareholders’ General Meeting. In addition, it should be noted that Mr de Silguy is the beneficiary of a supplementary pension plan and that he activated his pension rights as of 30 April 2010. VINCI’s commitment under this pension totalled €8,000,169 at 31 December 2012.

VINCI 2012 Annual Report

4.3

Report of the Chairman

187

Directors’ fees

At the Shareholders’ General Meeting of 6 May 2010, shareholders set the aggregate amount of Directors’ fees at €920,000 for each financial year, starting on 1 January 2010. In its meetings of 27 February 2008 and 3 March 2010, the Board of Directors agreed on the following allocation of Directors’ fees (amounts expressed on an annualised basis): ˇˇ the Chairman and Chief Executive Officer receives no Directors’ fees from the Company; ˇˇ the Vice-Chairman and Senior Director receives €140,000, of which €30,000 is variable and depends on his presence at Board meetings; ˇˇ other Directors receive €40,000 each, of which €20,000 is variable and depends on their presence at Board meetings; ˇˇ the chairman of each committee receives €25,000, the members of the Audit Committee receive €15,000 and the members of the other committees receive €10,000, in addition to the Directors’ fees mentioned above. Payment of the variable fee is dependent on the member’s attendance at Board meetings. The variable fee is reduced by €2,500 per meeting for any Board member who misses two or more meetings.

5. Formalities for participation of shareholders in the Shareholders’ General Meeting The formalities for shareholders to participate in the Shareholders’ General Meeting are described in Article 17 of the Articles of Association and reproduced below: Article 17 - Shareholders’ General Meetings Shareholders’ General Meetings are called and take place in accordance with the legislation and regulations in force. The meetings are held either at the registered office or at another location specified in the notice of the meeting. All shareholders may, regardless of the number of shares they own, participate in meetings personally or by proxy, on producing evidence of their identity and shareholding in the form of either: ˇˇ a personal registration of the shares in their own name; or ˇˇ a record of the shares in a bearer securities account with an authorised intermediary. The intermediary must provide an attendance certificate, which can be communicated by electronic means, if necessary. These formalities must be completed no later than midnight (Paris time), on the third business day before the meeting. Shareholders wishing to attend the meeting but who have not received their admission card by midnight (Paris time) of the third business day before the meeting will be given an attendance certificate. However, the Board of Directors may shorten or remove this time period provided that any such decision applies to all shareholders. If the Board of Directors so decides when the General Meeting is called, individual shareholders may take part in the General Meeting by video­ conference or vote by any telecommunication or electronic means including via the Internet, in accordance with the applicable regulations in force at the time such means are used. Any such decision must be communicated in the notice of meeting and the invitation to the meeting. Postal votes may be cast, subject to the terms and conditions defined by law and regulations. Shareholders may transmit proxy forms and postal votes for every Shareholders’ General Meeting, under the conditions set out by law and regulations, either in paper form or, if the Board of Directors so authorises, by electronic means, including over the Internet. Those shareholders who, within the required time period, use the electronic voting form on the website made available by the meeting centraliser, are counted as attending or represented shareholders. Shareholders may complete and sign the electronic voting form directly on the centralising bank’s website by any process determined by the Board of Directors that meets the conditions set forth in the first sentence of the second paragraph of Article 1316-4 of the French Civil Code and Articles R.225-77, subsection 2, and R.225-79 of the French Commercial Code and, more generally, the provisions of law and regulations in force. This process may include the use of a personal identifier and password. Proxy forms received and votes cast prior to the Shareholders’ General Meeting by electronic means, together with the acknowledgement of receipt provided, shall be considered as irrevocable acts enforceable with regard to all parties involved, it being specified that in the event of a sale of shares that takes place before the third business day prior to the Meeting at zero hour (Paris time), the Company shall invalidate or amend, as necessary, any proxy form or vote cast prior to such date and time. Shareholders’ General Meetings are chaired by the Chairman of the Board of Directors or, in his or her absence, by the Vice-Chairman of the Board of Directors, if a Vice-Chairman has been designated, or by a member of the Board of Directors specifically appointed by the Board to that effect. Failing that, shareholders elect their own Chairman. The minutes of the Shareholders’ General Meetings are drawn up and copies thereof are certified and delivered in compliance with regulations in force.

6. Publication of information required by Article L.225-100-3 of the French Commercial Code Information mentioned in Article L.225-100-3 of the French Commercial Code concerning elements likely to have an impact in the event of a takeover offer is published in the Report of the Board of Directors on page 174 of the 2012 annual report.

188

Report of the Chairman

B. Internal control and risk management procedures 1. Introduction 1.1

Definitions and reference framework

In July 2010, the French stock market regulator, the Autorité des Marchés Financiers (AMF), published the findings of the working group formed under its aegis. This document is entitled “Risk management and internal control systems: reference framework”. The VINCI Group uses this document as its reference framework. The risk management and internal control systems participate in a complementary manner in keeping control over the Group’s business. “Risk” is the possibility that an event might take place with consequences that would adversely affect the objectives of the Group and in particular those related to its financial condition and reputation. The risk management system aims to identify and analyse the principal risks that the Group’s subsidiaries encounter. “Internal control” encompasses all the controls to best handle these risks. Risk management is therefore a set of resources, conduct, procedures and initiatives that correspond to the characteristics of the VINCI Group’s businesses and maintain risk at an acceptable level. VINCI’s risk management system is a management tool to be used by each company in the Group to help: ˇˇ create and preserve value, assets and the Company’s reputation; ˇˇ secure the Company’s decision-making procedures and other processes so as to increase the likelihood of achieving objectives; ˇˇ ensure that initiatives are in line with the Company’s values; ˇˇ foster a shared view of the principal risks among employees of the Company. The internal control system aims more particularly to ensure: that the instructions and guidelines set by the Executive Management are implemented; ˇˇ that laws and regulations are complied with; ˇˇ that the internal processes function correctly, notably those contributing to the safeguarding of its assets; ˇˇ that financial reporting is reliable. ˇˇ

The internal control system is a set of resources, procedures, conduct and initiatives that correspond to the characteristics of the VINCI Group’s businesses and which: ˇˇ helps the businesses run smoothly and contributes to effective operations and efficient use of resources; ˇˇ must enable significant risks to be taken into account in an appropriate manner, whether they are operational, financial or legal. Nevertheless, like any set of controls, however well designed and implemented the internal control system may be, it cannot provide an absolute guarantee that the Group will achieve its objectives.

1.2

Scope of risk management and internal control

In addition to managing a system specific to VINCI Holding, the Group also ensures that there are risk management and internal control systems in place at each of its component businesses. These systems apply to fully consolidated entities, a list of which can be found in Chapter J of the notes to the consolidated financial statements (page 268). For the specific case of the listed Belgian company CFE (in which VINCI has a 46.84% capital stake) and its subsidiaries, the provisions in force are adapted to the specific features of Belgian law, which attributes responsibility for risk management and internal control to the Board of Directors of companies listed on the stock exchange.

2. 2.1

Environment and organisation Principles of action and conduct

The businesses in which VINCI operates require the personnel involved to be geographically close to customers in order to ensure the prompt delivery of solutions that are suited to their needs. To enable the manager of each business unit – around 3,500 in total in the Group – to take the required operational decisions rapidly, a decentralised organisation has been implemented in each business (Concessions and Contracting), business line and division, as well as in VINCI Immobilier. Consequently, the Group has implemented appropriate delegation of authority and responsibility to operational and functional staff at all levels. The delegation of authority to these staff is carried out in compliance with the general guidelines (see paragraph 4.2) and the principles of action and conduct to which VINCI is strongly committed: ˇˇ strict compliance with the rules common to the whole Group in respect of commitments, risk-taking (see paragraph 4.3), acceptance of contracts (see paragraphs 4.4 and 4.5), and reporting of financial, accounting and management information (see paragraph 4.2). These common rules, which are deliberately restricted in number given the broad spectrum of the Group’s activities, must be strictly applied by the staff concerned and their teams; ˇˇ transparency and loyalty of managers towards their line management superiors and towards the functional departments of the business lines and the holding company. In particular, managers are required to inform their superiors of any significant difficulties encountered in the performance of their duties (e.g. with respect to carrying out work on sites; relations with customers, government departments, suppliers and financial partners; internal relations, personnel management, safety, etc.). An integral part of operational managers’ duties is to take decisions alone on matters falling within their area of competence, within the framework of the general guidelines they have received and accepted.

VINCI 2012 Annual Report

Report of the Chairman

189

Nevertheless, any significant difficulties encountered must be handled with the assistance, as necessary, of their line management superiors or the functional departments of the business lines and the VINCI holding company; ˇˇ compliance with the laws and regulations in force in the countries where the Group operates; ˇˇ adherence to the Code of Ethics and Conduct; ˇˇ responsibility of operational executive managers to communicate the Group’s principles governing action and conduct to their staff by appropriate means and to set a good example. This responsibility cannot be delegated; ˇˇ health and safety of individuals (employees, external service providers, subcontractors, etc.); ˇˇ a culture of financial performance.

2.2

Participants in the risk management and internal control processes

Everyone in the organisation plays a role in risk management and internal control, from the governing bodies to the employees of each Group subsidiary. VINCI’s Board of Directors represents all the shareholders collectively and is responsible for monitoring the Executive Management performance, defining the Group’s strategic choices and ensuring that it functions properly. It considers all major matters concerning the Group’s business. In its report, the Board gives an account of the principal risks and uncertainties the Group faces. In 2003, the Board adopted a set of internal rules and created several specialised committees: audit, strategy and investment, remuneration, and appointments and corporate governance. It delegated to the Audit Committee responsibility for the monitoring of assignments defined by the 8 December 2008 Order transposing the European directive on statutory auditing into French law. The principal activities carried out in 2012 in this regard can be found in part A of the Report of the Chairman of the Board (page 179). They are in line with the recommendations of the AMF working group on audit committees (dated July 2010). The Executive Committee, composed of 13 members at the time of writing of this report (see page 14), is in charge of implementing the Group’s strategy, defining the monitoring of the enforcement of its management policies (risk management, finance, human resources, safety, insurance, etc). The holding company functions with a streamlined staff (213 people at 31 December 2012), suited to the Group’s highly decentralised structure. The holding company’s functional departments ensure that the Group’s rules and procedures as well as the Executive Management’s decisions are correctly enforced. Furthermore, and depending on the needs that are expressed, these departments advise business lines on technical matters but do not interfere with operational decisions, which are the sole responsibility of the business lines. The Ethics Officer ensures, in liaison with the operational and functional departments, that the Code of Ethics and Conduct is properly understood throughout the Group. Any employee encountering difficulties or who has questions about the scope or application of the rules may contact the Ethics Officer directly and in total confidentiality. The Audit Department has a three-part role. ˇˇ Concerning risk management: based on guidelines from the Executive Management, it plays a leading role in deploying and implementing a structured, permanent and adaptable system, making it possible to identify, analyse and handle the principal risks. The Audit Department coordinates the risk management system by giving methodological support to the subsidiaries’ operational and functional departments. It organises the meetings of the VINCI Risk Committee, which reviews and authorises new contracts exceeding certain thresholds set by Executive Management or presenting particular technical or financial risks. ˇˇ Concerning internal control: in addition to drafting and disseminating the general internal control procedures set by the holding company, the Audit Department organises the annual self-assessment survey on the internal control of the Group’s subsidiaries. ˇˇ Concerning auditing: it carries out its own assignments, in support of the work performed by the business lines and by the members of the holding company’s functional departments, depending on their areas of expertise. The business lines carry out their activities based on the principles of action and conduct described in paragraph 2.1. In this regard, they implement and supervise risk management and internal control systems suited to their business.

3.

Risk management system “Risks” are defined as obstacles that might prevent the Company from achieving its objectives. These objectives may be strategic (commitments), operational, financial, or in relation to compliance with laws and regulations. The Group applies the policies set by the Executive Committee. These policies aim to comply with the legal requirements and to ensure that risks are monitored in a more formalised, systematic and uniform manner. This plan involves operational managers, but without complicating operating methods. Risk monitoring is an integral part of the existing procedures related to commitments and periodic monitoring of operations. A risk-mapping process encompassing all the Group’s activities was created in 2009 and is updated periodically as follows, in accordance with the AMF’s recommendations: ˇˇ anticipation of the main identifiable risks, either internal or external, that represent obstacles to the achievement of the Company’s objectives; ˇˇ a qualitative assessment of risk criticality, taking into account the impact, likelihood and degree of control of each element of risk. This procedure has been applied to identify, assess and select the major risks threatening the various components of the Group: holding company, Concessions, Contracting, and Property. These risks are described in the chapter entitled “Risk factors”, on page 120 of the Report of the Board of Directors.

190

Report of the Chairman

Risk mapping makes it possible to apply a specific procedure to each type of risk, which can be assessed using the coordination indicators. Risk scorecards are created from the mapping system specific to each business (Concessions, Contracting). The scorecards are used during Risk Committee meetings to present and assess, in a uniform manner, the most significant events that might affect the project under review.

4.

Internal control system The main procedures described below are common to all companies in the Group. There are specific procedures within each business line, in particular for the monitoring of projects and forecasting of results, especially for contracts spanning several years.

4.1

Compliance with laws and regulations

The Group’s compliance objectives encompass the standards of conduct set by the laws and regulations in force. The Legal Department of the holding company is responsible for: ˇˇ maintaining a legislative watch related to the various applicable rules; ˇˇ informing employees about rules pertaining to them; ˇˇ monitoring major acquisition projects and disputes. Documentation has been distributed and a variety of training and awareness sessions held in this regard, so as to prevent any infraction or fraud. As indicated in the first part of the Sustainable Development section on pages 18–29 of this report, particular emphasis is placed on: safety of employees on construction sites through active implementation of the Group’s accident prevention policy; ˇˇ purchasing and subcontracting. ˇˇ

4.2

Application of the guidelines and instructions of the Executive Management

The Chairmen of the companies heading business lines in the Contracting business (VINCI Energies, Eurovia and VINCI Construction), the Chairman of VINCI Autoroutes, the Chief Executive Officer of VINCI Concessions and the Chairman of VINCI Immobilier exercise the powers given to them by law. Under the Group’s internal organisation, they are also required to comply with the general guidelines issued for them by VINCI’s Chairman and Chief Executive Officer. These apply to the following areas: ˇˇ adherence to the Code of Ethics and Conduct; ˇˇ entering into commitments, and in particular bidding for new contracts that are complex, of a significant size or involve significant potential risks; acquisitions and disposals; property transactions; and material off-balance sheet commitments; ˇˇ reporting to the holding company of accounting and financial information or information relating to events that are material for the Group, in respect of safety, litigation, disputes, and insurance policies and claims. These general guidelines require compliance with the holding company’s procedures regarding bidding or investments. These procedures define thresholds above which specific authorisation must be obtained from the appropriate committees, namely the Risk Committee (see paragraph 4.3) or the Board of Directors’ Strategy and Investment Committee, or where prior notifications must be issued to the Chairman and Chief Executive Officer and/or to certain VINCI functional departments. These guidelines are cascaded through the organisation by the heads of the business lines: via delegations to their operational and functional staff for the provisions concerning them; ˇˇ to managers serving as company officers in a company in their business sector. ˇˇ

4.3

Procedures related to new commitments – the VINCI Risk Committee

Strict control procedures are in force that must be complied with before a new commitment is accepted.

The role of the VINCI Risk Committee is to assess: ˇˇ acquisitions and disposals of businesses; ˇˇ the terms and conditions of tenders for construction works which, by virtue of their scale, specific financing characteristics, location or technical characteristics, entail specific risks of a technical, legal, financial or other nature. The thresholds for automatic prior review and vetting by the Risk Committee are defined in the general guidelines. They apply to the entire project, taking all works packages together, irrespective of the Group’s share in the project or the manner in which contracts are awarded (call for tenders, direct contracts, etc.); ˇˇ all transactions relating to property development, public-private partnerships (PPPs), concession operations or long-term commitments, including all associated financing, whether in France or elsewhere. Thresholds below those necessitating a review by the Risk Committee require that an information sheet be sent to VINCI’s Executive Management. A Risk Committee meeting may be convened, as needed.

VINCI 2012 Annual Report

Report of the Chairman

191

Risk Committee meetings are usually attended by the following members: the Chairman and Chief Executive Officer of VINCI and/or the Executive Vice-President, Contracting; ˇˇ the Chairman (or Chief Executive Officer) of the business line involved; ˇˇ the Executive Vice-President and Chief Financial Officer of the Group; ˇˇ the Chief Audit Officer; ˇˇ the operational representatives of the entity presenting the project (Chief Executive Officer, project manager, etc.); ˇˇ the functional representatives of the entity involved (legal, insurance, finance, etc.). ˇˇ

The composition of the Risk Committee may be adjusted as a function of its agenda (e.g. review of property transactions, acquisitions of companies, construction contracts, concession contracts and PPPs). The VINCI Risk Committee, in its various configurations, met 251 times in 2012 and reviewed 308 projects.

4.4

Procedures related to monitoring of operations

The business lines have their own operational control systems, which are tailored to their business. Specific budget control measures have been implemented by VINCI Energies, Eurovia and VINCI Construction and by each of the concession activities (motorways, car parks, etc.). They make it possible to regularly monitor the progress of projects and contracts. These systems are compatible with those used to prepare and process financial and accounting information as described below. Monthly dashboard reports on business, new orders, the order book and the Group’s consolidated net borrowing position are prepared by the Finance Department on the basis of detailed information provided by the business lines. Each main entity’s Executive Management prepares a monthly report on key events. The budget procedure is common to all Group business lines and their subsidiaries. It is built around five key dates in the year: the initial budget for the next year at the end of the current year, followed by four updates in March, May, September and November. Management committees meet twice a year to examine each business line’s performance and financial data. The Chairman and Chief Executive Officer, and the Executive Vice-President and Chief Financial Officer of VINCI attend these meetings. Lastly, the business lines participate in regular monitoring of VINCI’s social and environmental responsibility commitments as indicated in the first part of the Sustainable Development section on pages 18–29 of this report, with a particular emphasis on safety.

4.5 Procedures related to the preparation and processing of financial and accounting information The Budgets and Consolidation Department, reporting to the Finance Department, is responsible for the integrity and reliability of VINCI’s financial information (parent company and consolidated financial statements), which is disseminated inside and outside the Group. To ensure the statements are produced, the department is specifically in charge of: ˇˇ preparing, approving and analysing VINCI’s half-year and annual parent company and consolidated financial statements and forecasts; ˇˇ establishing, disseminating and monitoring the Group’s accounting procedures and checking their compliance with the accounting standards in force, as well as ensuring that significant transactions are recognised correctly from an accounting standpoint; ˇˇ coordinating “Vision”, the Group’s financial information system, which includes the consolidation process and unifies VINCI’s various reporting systems. The Budgets and Consolidation Department establishes the timetable and closure instructions for the preparation of the half-year and annual accounts and disseminates these in the business lines. The Group’s accounting rules and methods are available on VINCI’s corporate intranet. At each accounts closure, business lines transmit a package to the Budgets and Consolidation Department containing an analysis of the consolidated data submitted and comments thereon. The Group and the CFOs of the business lines review the principal options and accounting estimates in liaison with the Statutory Auditors. The Statutory Auditors present their observations, if any, on the half-year and annual accounts to the Audit Committee before they are presented to the Board of Directors. Before signing their reports, the Statutory Auditors request representation letters from Group management and management of the business lines. In these representations, Group management and management of the business lines confirm that to the best of their knowledge, all items at their disposal have been submitted to the Statutory Auditors so as to enable them to perform their duties and that any anomalies noted by the Statutory Auditors and still unresolved at the date of these representations do not have a material impact, either individually or in aggregate, on the financial statements taken as a whole.

192

Report of the Chairman

5. Actions undertaken to strengthen risk management and internal control 5.1

Tasks carried out prior to 2012

In 2003, VINCI initiated an action plan intended to enhance the quality of the Group’s risk management and internal control systems without calling into question the principles and features of its decentralised management organisation. These actions included, in particular: Assessment of internal control Annual self-assessment surveys to measure the quality of internal control, in accordance with the requirements of the French Financial Security Act, covered an ever-increasing number of Group entities, rising from 193 in 2005 to 370 in 2011. Information systems Surveys to assess the operation of information systems were carried out in 2006, 2008 (13 entities in metropolitan France, building a representative sample) and 2009 (33 subsidiaries based outside metropolitan France). In 2011, a working group, assisted by an external consultancy, prepared a report on the adequacy of the information systems used by VINCI’s different business lines with respect to the Group’s objectives. The report is based on the results of a survey of VINCI’s component entities. The Code of Ethics and Conduct, previously disseminated via the corporate hierarchy, was made available to all employees on the Group intranet on 1 February 2011. In 2011, in line with its objectives, VINCI implemented its Fast Close procedure, aimed at closing and publishing its financial statements at the beginning of February, representing a one-month gain on its previous publication schedule.

5.2

Tasks carried out in 2012

The annual self-assessment survey of internal control quality in the VINCI Group was carried out on 472 legal entities in 2012 (including 110 outside France), representing 84% of the Group’s consolidated business. The questionnaire contained 58 questions. Apart from the recurrent topics related to the internal control system and to financial and accounting information, the annual topic in 2012 related to purchasing and subcontracting. The survey was conducted using specialised software that also enables entities to manage their action plans. The report prepared by the holding company’s Audit Department was presented to VINCI’s Executive Committee and then to the Audit Committee in December. As in 2011, a specific questionnaire was sent to the Chairman and Chief Executive Officer covering matters related to his functions. With regard to information systems, VINCI’s Executive Committee considered that a more effective flow of communication within the Group was essential to achieving current and future objectives and therefore initiated developments that were carried out in 2012 in the following areas: ˇˇ interoperability of Group networks; ˇˇ redesign of VINCI’s intranet and launch of version 2.0 based on a collaborative approach. The Fast Close procedure was applied to the half-year financial statements published at the end of July. Each Group component prepared a report summarising the specific actions carried out in 2012. The reports, which in particular give an account of the audits and reviews carried out, did not reveal any significant problems. In addition, VINCI’s Audit Department carried out audits in each of the following business lines: VINCI Concessions, Eurovia, VINCI Energies and VINCI Construction. These audits did not reveal any problems that might have a significant impact on the business or financial statements of the Group.

5.3

Work to be done in 2013 and beyond

VINCI aims to continue improving the organisation of internal control within the Group, while maintaining a streamlined chain of command, both at the holding company and business line levels. In addition to the annual internal control self-assessment survey, a self-assessment campaign on information systems was started in early 2013. The interoperability programme for messaging networks, launched in 2012, is also under way. Other areas for improvement include: ˇˇ continued deployment of common management tools; ˇˇ continued integration of acquired entities.

193

Report of the Chairman

VINCI 2012 Annual Report

Report of the Statutory Auditors in application of Article L.225-235 of the French Commercial Code

on the Report of the Chairman of the Board of Directors Year ended 31 December 2012 To the shareholders As Statutory Auditors of VINCI SA, and in application of the provisions of Article L.225-235 of the French Commercial Code, we present our report on the report prepared by the Chairman of your Company in accordance with the provisions of Article L.225-37 of the French Commercial Code, for the year ended 31 December 2012. The Chairman is required to prepare and submit for the approval of the Board of Directors a report on the internal control and risk management procedures implemented within the Company and to provide the other information required by Article L.225-37 of the French Commercial Code relating in particular to corporate governance. Our role is: ˇˇ to communicate to you any comments required by the information contained in the Chairman’s report on internal control and risk management procedures relating to the preparation and treatment of accounting and financial information; and ˇˇ to attest that the report includes the other information required by Article L.225-37 of the French Commercial Code, it being clearly stated that we are not required to verify the fair presentation of this other information. We conducted our review in accordance with the professional standards applicable in France. Information on the internal control and risk management procedures relating to the preparation and treatment of accounting and financial information The applicable professional standards require us to plan and perform our work so as to be able to assess the fair presentation of the information in the Chairman’s report on the internal control and risk management procedures relating to the preparation and treatment of accounting and financial information. Those standards require in particular that we: ˇˇ inform ourselves of the internal control and risk management procedures relating to the preparation and treatment of the accounting and financial information supporting the information presented in the Chairman’s report, and of the existing documentation; ˇˇ inform ourselves of the work done to prepare this information and the existing documentation; ˇˇ ascertain if appropriate disclosures have been made in the Chairman’s report in respect of any major deficiencies of internal control relating to the preparation and treatment of accounting and financial information that we may have noted in performing our work. On the basis of this work, we have no comments to make on the disclosures regarding the Company’s internal control and risk management procedures relating to the preparation and treatment of accounting and financial information, contained in the report of the Chairman of the Board of Directors, prepared in application of Article L.225-37 of the French Commercial Code. Other information We declare that the Report of the Chairman of the Board of Directors includes the other information required by Article L.225-37 of the French Commercial Code. Paris-La Défense and Neuilly sur Seine, 7 February 2013 The Statutory Auditors KPMG Audit Department of KPMG SA Patrick-Hubert Petit

Deloitte & Associés

Alain Pons

Mansour Belhiba

This is a free translation into English of the Statutory Auditors’ report issued in French prepared in accordance with Article L. 225-235 of French company law on the report prepared by the Chairman of the company on the internal control and risk management procedures relating to the preparation and processing of accounting and financial information issued in French and is provided solely for the convenience of English speaking users. This report should be read in conjunction with, and construed in accordance with, French law and the relevant professional standards applicable in France.

194

Report of the Vice-Chairman and Senior Director

Report of the Vice-Chairman and Senior Director of the Board of Directors The Vice-Chairman and Senior Director of the VINCI Board of Directors hereby reports on the role and responsibilities that were assigned to him in this capacity during the 2012 financial year. This report was prepared by the Vice-Chairman in liaison with the Company’s legal department and was submitted to the Remuneration Committee and to the Appointments and Corporate Governance Committee before being presented to the VINCI Board of Directors at its meeting on 5 February 2013.

1.

Terms of reference for the Vice-Chairman and Senior Director The terms of reference for the Vice-Chairman and Senior Director are described as follows in Article 2.3.2 of the internal rules of the Board of Directors, which are also available on the Company’s website (www.vinci.com): “The Vice-Chairman is the Senior Director of the Board. The Vice-Chairman assists the Chairman with his duties, notably the organisation and proper functioning of the Board and its committees and the supervision of corporate governance and internal control. “The Vice-Chairman also assists the Board in ensuring the proper functioning of the Company’s governance bodies and provides the Board with his insight on the transactions the Board is called to approve. “He holds a meeting with the Directors once a year, in the absence of the executive company officers. “The Chairman and Chief Executive Officer keeps the Vice-Chairman informed of material events or situations affecting the Group, notably relating to strategy, organisation, financial reporting, significant investment and divestment projects, major financial transactions, changes to the company’s share capital and contacts with the company’s main current or potential shareholders. “In order to carry out his role and responsibilities, the Vice-Chairman has direct access to the members of the Group’s Executive Committee. In coordination with the Chairman and Chief Executive Officer, the Vice-Chairman may organise any meeting with executives and employees designated by them that he deems appropriate or useful to the performance of his duties. The Vice-Chairman may consult with the managers responsible for internal control, risk and compliance or the Statutory Auditors and may access any document or information that he deems necessary for the performance of his duties. “The Chairman and Chief Executive Officer facilitates the performance of these duties by providing the required instructions.”

2.  Activities of the Vice-Chairman and Senior Director in the performance of the duties assigned to him by the Board of Directors During the financial year 2012, the Vice-Chairman and Senior Director participated in all nine Board meetings. He chaired all four meetings of the Appointments and Corporate Governance Committee and all five meetings of the Strategy and Investment Committee. In addition, the Vice-Chairman and Senior Director kept up to date on Group events by meeting very regularly with the Chairman and Chief Executive Officer, the Executive Vice-President and Chief Financial Officer, the heads of the business lines, the other members of the Executive Committee, the Senior Vice-President, Corporate Controlling and Accounting Department, a number of other Group managers and the Statutory Auditors. He participated in the Group’s management convention in June 2012 and visited numerous worksites in France and abroad. He also reviewed the documents produced for Audit Committee meetings as well as management reporting documents prepared regularly by the Finance Department. The Vice-Chairman and Senior Director devoted the equivalent of around 36 full working days to these meetings in 2012. The Vice-Chairman and Senior Director maintained frequent contact with each Board member and met with each of them individually in 2012. He sent a detailed written report about the execution of his duties to the Remuneration Committee. He called and chaired a meeting of Board members, without the Chairman and Chief Executive Officer being present, so as to evaluate the Executive Management. With the help of a firm of consultants, he interviewed candidates for the position of Board member prior to their presentation to shareholders at the Shareholders’ General Meeting. Lastly, the Vice-Chairman and Senior Director presented his report on financial year 2011 to shareholders at the 12 April 2012 Shareholders’ General Meeting. As a result of his work, the Vice-Chairman and Senior Director concluded that the governing bodies functioned normally. Board meeting agendas were communicated to him for his opinion before invitations were sent out to Board members, and he did not request the inclusion of any additional items. Consequently, he did not deem it necessary to call a Board meeting pursuant to Article 3.1 of the Board’s internal rules.

VINCI 2012 Annual Report

Consolidated financial statements

195

Consolidated financial statements Table of contents

Key figures Consolidated income statement for the period Consolidated comprehensive income statement for the period Consolidated balance sheet Consolidated cash flow statement Consolidated statement of changes in equity

197 197 198 198 200 201

Notes to the consolidated financial statements A.

B.

C.

D.

E.

Accounting policies and measurement methods

202

Business combinations

213

Information by operating segment

214

Notes to the income statement

220

Notes to the balance sheet

224

1. 2. 3.

1. 2.

General policies Consolidation methods Measurement rules and methods

Acquisition of GA Gruppe Other acquisitions

1. Revenue 2. Other information by business line 3. Breakdown of the Concessions business data 4. Capital employed by geographical area

5. 6. 7. 8.

Operating income Financial income and expense Income tax expense Earnings per share

9. Concession intangible assets 10. Goodwill 11. Other intangible assets 12. Property, plant and equipment 13. Impairment tests on goodwill and other non-financial assets 14. Investment property 15. Investments in companies accounted for under the equity method 16. Other non-current financial assets 17. Construction contracts (VINCI Energies, Eurovia and VINCI Construction) 18. Equity 19. Share-based payments 20. Non-current provisions 21. Working capital requirement and current provisions 22. Net financial debt 23. Financial risk management 24. Book and fair value of financial instruments by accounting category

202 203 204

213 214

215 216 218 219

220 221 222 223

224 225 226 227 227 228 229 230 232 232 235 238 242 245 251 257

196

F.

G.

H. I.

J.

Consolidated financial statements

Notes on the main features of concession and PPP contracts

259

Other notes

263

Note on litigation

265

Post balance sheet events

267

List of the main consolidated companies at 31 December 2012

268

25. Controlled subsidiaries’ concession contracts – intangible asset model 26. Controlled subsidiaries’ concession and PPP contracts – financial asset model and bifurcated model 27. Concession and PPP contracts of companies accounted for under the equity method

28. Related party transactions 29. Contractual obligations and other off-balance sheet commitments 30. Statutory Auditors’ fees

31. Appropriation of 2012 net income 32. Other post balance sheet events

Controlled companies Companies accounted for under the equity method

259 261 262

263 264 265

267 267

268 273

VINCI 2012 Annual Report

197

Consolidated financial statements

Financial statements

Key figures 2012

2011

Revenue (*)

38,633.6 

36,955.9

Revenue generated in France (*)

24,324.2 

23,561.8 

(in € millions)

% of revenue (*) Revenue generated outside France (*) % of revenue (*) Operating income from ordinary activities

63.0%

63.8%

14,309.4 

13,394.1 

37.0%

36.2%

3,670.7 

3,659.9 

9.5%

9.9%

Operating income

3,651.0 

3,601.0 

Net income for the period attributable to owners of the parent

% of revenue (*)

1,916.7 

1,904.3 

Diluted earnings per share (in €)

3.54 

3.48 

Dividend per share (in €)

1.77 

1.77 

5,418.5 

5,366.2 

Cash flows from operations before tax and financing costs Operating investments (net of disposals) Growth investments in concessions and PPPs

(742.1)

(668.0)

(1,139.6)

(1,135.4)

Free cash flow (after investments)

1,983.0 

2,134.2 

Equity including non-controlling interests

14,069.8 

13,615.3 

Net financial debt

(12,526.8)

(12,589.6)

(*) Excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies.

Consolidated income statement for the period (in € millions)

Notes

2012

2011

Revenue (*)

1-2-3

38,633.6 

36,955.9 

Concession subsidiaries’ revenue derived from works carried out by non-Group companies Total revenue

549.6 

690.2 

39,183.2 

37,646.1 

Revenue from ancillary activities



234.4 

205.0 

Operating expenses



(35,746.9)

(34,191.2)

2-5

3,670.7 

3,659.9 

19 

(94.3)

(101.4)

5-10-13

(7.5)

(8.0)

5-15

82.1 

50.5 



3,651.0 

3,601.0 

(726.8)

(741.9)

Operating income from ordinary activities Share-based payments (IFRS 2) Goodwill impairment expense Profit/(loss) of companies accounted for under the equity method Operating income Cost of gross financial debt Financial income from cash investments

89.1 

95.2 

(637.7)

(646.6)

Cost of net financial debt



Other financial income



111.6 

99.2 

Other financial expense



(130.4)

(74.0)

Income tax expense



Net income from continuing operations

(969.2)

(983.6)

2,025.2 

1,996.0 

2,025.2 

1,996.0 

Net income from discontinued operations (halted or sold) Net income Net income attributable to non-controlling interests Net income for the period attributable to owners of the parent

108.5 

91.7 

1,916.7 

1,904.3 

Earnings per share from continuing operations – attributable to owners of the parent Basic earnings per share (in €)



3.57 

3.52 

Diluted earnings per share (in €)



3.54 

3.48 

Earnings per share attributable to owners of the parent Basic earnings per share (in €)



3.57 

3.52 

Diluted earnings per share (in €)



3.54 

3.48 

(*) Excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies.

198

Consolidated financial statements

Consolidated comprehensive income statement for the period 2012

(in € millions) Net income Financial instruments of controlled companies: changes in fair value

2011

Attributable to owners of the parent

Attributable to noncontrolling interests

Attributable to owners of the Total parent

Attributable to noncontrolling interests

1,916.7 

108.5 

2,025.2 

Total

1,904.3 

91.7 

1,996.0 

(47.7)

(0.7)

(48.4)

(110.9)

0.4 

(110.6)

(65.3)

(0.7)

17.6 

(19.9)

(0.0)

(19.9)

(66.0)

(91.1)

0.4 

(90.7)

(180.3)

(12.6)

(193.0)

(255.2)

(16.8)

(272.0)

of which: Available-for-sale financial assets Cash flow hedges (*) Financial instruments of companies accounted for under the equity method: changes in fair value

17.6 

Currency translation differences

34.3 

3.9 

38.2 

(6.1)

(1.0)

(7.1)

Tax (**)

76.4 

3.9 

80.4 

117.0 

3.8 

120.8

(117.4)

(5.5)

(122.9)

(255.3)

(13.6)

(268.9)

Income and expense for the period recognised directly in equity of which: Controlled companies Companies accounted for under the equity method Total comprehensive income

0.6 

1.1 

1.7 

(80.2)

(0.5)

(80.7)

(118.0)

(6.6)

(124.6)

(175.1)

(13.1)

(188.2)

1,799.3 

103.0 

1,902.3 

1,649.0 

78.1 

1,727.1 

(*) Changes in the fair value of cash flow hedges (interest rate hedges) are recognised in equity for the effective portion. Cumulative gains and losses in equity are taken to profit or loss at the time when the cash flow affects profit or loss. (**) Including positive tax effects of €80.4 million relating to changes in the fair value of financial instruments (€120.8 million in 2011), negative effects of €6.0 million relating to available-for-sale financial assets (positive effects of €6.8 million in 2011) and positive effects of €86.4 million relating to the effective portion of cash flow hedges (€114 million in 2011).

Consolidated balance sheet Assets (in € millions)

Notes

31/12/2012

31/12/2011

Non-current assets Concession intangible assets



23,499.9 

23,921.5 

10-13

6,609.3 

6,263.8 

Other intangible assets

11 

437.4 

374.8 

Property, plant and equipment

12 

4,746.2 

4,399.1 

Goodwill

Investment property

14 

10.5

48.0 

Investments in companies accounted for under the equity method

15 

810.3 

748.6 

Other non-current financial assets

16 

1,715.4 

1,267.6 



202.7 

179.1 

38,031.6 

37,202.5 

Deferred tax assets Total non-current assets Current assets Inventories and work in progress

21 

1,015.5

1,004.1

Trade and other receivables

21 

10,978.6 

10,222.0 

Other current operating assets

21 

4,505.5 

4,131.3 

35.2 

46.3 

Other current non-operating assets Current tax assets



Other current financial assets

87.1 

70.4 

421.1 

356.6

Cash management financial assets

22 

179.2 

169.6 

Cash and cash equivalents

22 

6,336.9 

7,372.4 

Total current assets

23,559.1 

23,372.7 

Total assets

61,590.7 

60,575.2 

VINCI 2012 Annual Report

199

Consolidated financial statements

Consolidated balance sheet Equity and liabilities Notes

31/12/2012

31/12/2011

Share capital

18.1

1,443.4 

1,413.2 

Share premium

18.1

7,487.9 

7,182.4 

Treasury shares

18.2

(1,661.8)

(1,097.5)

(in € millions) Equity

Other equity instruments Consolidated reserves Currency translation reserves Net income for the period attributable to owners of the parent Amounts recognised directly in equity

18.4

Equity attributable to owners of the parent Non-controlling interests

18.6

Total equity

490.6 

490.6 

4,269.2 

3,493.9 

57.2 

22.7 

1,916.7 

1,904.3 

(668.8)

(519.8)

13,334.4 

12,889.9 

735.4 

725.4 

14,069.8 

13,615.3  1,535.4 

Non-current liabilities Non-current provisions

20

1,796.5 

Bonds

22 

9,615.3 

7,819.8 

Other loans and borrowings

22 

6,938.5 

9,605.2 

131.5 

95.6 



2,080.4 

2,166.9 

20,562.3

21,223.0  3,484.1 

Other non-current liabilities Deferred tax liabilities Total non-current liabilities Current liabilities Current provisions

21 

3,507.7 

Trade payables

21 

7,603.6 

7,625.0 

Other current operating liabilities

21 

11,306.3 

10,381.5 

539.9 

567.8 

Current tax liabilities



361.3 

232.6 

Current borrowings

22 

Other current non-operating liabilities

3,640.0 

3,445.8 

Total current liabilities

26,958.7

25,736.9 

Total equity and liabilities

61,590.7 

60,575.2 

200

Consolidated financial statements

Consolidated cash flow statement Notes

(in € millions) Consolidated net income for the period (including non-controlling interests) Depreciation and amortisation

5.2

Net increase/(decrease) in provisions Share-based payments (IFRS 2) and other restatements Gain or loss on disposals Change in fair value of financial instruments Share of profit or loss of companies accounted for under the equity method and dividends received from unconsolidated entities Capitalised borrowing costs Cost of net financial debt recognised



Current and deferred tax expense recognised

2012

2011

2,025.2 

1,996.0 

1,877.0 

1,810.7 

106.1 

67.7 

(1.3)

10.9

(24.0)

(20.5)

(1.4)

(1.4)

(99.0)

(66.4)

(71.3)

(60.9)

637.7 

646.6 

7.1

969.2 

983.6 

Cash flows (used in)/from operations before tax and financing costs

2

5,418.5 

5,366.2 

Changes in operating working capital requirement and current provisions

21.1

(37.4)

93.4 

Income taxes paid

(978.6)

(936.2)

Net interest paid

(595.0)

(643.4)

Dividends received from companies accounted for under the equity method Cash flows (used in)/from operating activities

I

Purchases of property, plant and equipment and intangible assets Proceeds from sales of property, plant and equipment and intangible assets

57.2 

57.7 

3,864.7 

3,937.6 

(870.6)

(757.7)

128.5 

89.7 

Operating investments (net of disposals)



(742.1)

(668.0)

Operating cash flow



3,122.6 

3,269.5 

(1,123.5)

(1,106.4)

Investments in concession fixed assets (net of grants received) Financial receivables (PPP contracts and others)

(16.1)

(29.0)

Growth investments in concessions and PPPs



(1,139.6)

(1,135.4)

Free cash flow (after investments)



1,983.0 

2,134.2 

(611.8)

(196.8)

Purchases of shares in subsidiaries and affiliates (consolidated and unconsolidated) Proceeds from sales of shares in subsidiaries and affiliates (consolidated and unconsolidated)

7.4 

39.7 

Net effect of changes in scope of consolidation

6.3 

(15.1)

(598.0)

(172.2)

Net financial investments Other Net cash flows (used in)/from investing activities

II

Changes in share capital Transactions on treasury shares Non-controlling interests in share capital increases and decreases of subsidiaries Acquisitions/disposals of non-controlling interests (without acquisition or loss of control) (*)

(49.5)

(95.9)

(2,529.2)

(2,071.5)

335.7 

393.5 

(646.9)

(623.5)

(1.3)

0.6 

(96.3)

(34.9)

(978.8)

(946.8)

Dividends paid - to shareholders of VINCI SA (**) - to non-controlling interests

(77.8)

(89.0)

Proceeds from new long-term borrowings

1,624.3 

1,627.0 

Repayments of long-term loans

(2,539.2)

(1,723.7)

Change in cash management assets and other current financial debts Net cash flows (used in)/from financing activities Change in net cash

300.9 

933.4 

III

(2,079.5)

(463.4)

I+II+III

(744.0)

1,402.7 

6,514.1 

5,071.1 

Net cash and cash equivalents at beginning of period Other changes (***) Net cash and cash equivalents at end of period

22.2

Increase/(decrease) in cash management financial assets

(24.3)

40.3 

5,745.8 

6,514.1 

(300.9)

(933.4)

(Proceeds from)/repayment of loans

914.9 

96.7 

Other changes (***)

217.1

(136.2)

Change in net financial debt Net financial debt at beginning of period Net financial debt at end of period

22 

(*) Corresponding mainly to the buy-out of non-controlling interests (19.83%) in Entrepose Contracting for €102.4 million after the simplified public tender offer. (**) Including the €31.3 million interest payment on the perpetual subordinated bonds. (***) Including the change in the consolidation method used for Greek company Gefyra.

62.8 

470.1 

(12,589.6)

(13,059.7)

(12,526.8)

(12,589.6)

201

Consolidated financial statements

VINCI 2012 Annual Report

Consolidated statement of changes in equity Equity attributable to owners of the parent

(in € millions)

Share Share capital premium

Balance at 01/01/2011

1,381.6 

6,820.6 

Other Treasury equity Consolidated shares instruments reserves (552.2)

490.6 

2,629.8 

Net income for the period

Total Amounts attributable Currency recognised to Net translation directly in owners of income reserves equity the parent 1,775.9 

28.5 

(270.7)

1,904.3 

Noncontrolling interests

Total

12,304.0 

720.6 

13,024.7 

1,904.3 

91.7 

1,996.0 

Income and expense for the period recognised directly in equity of controlled companies

(7.7)

(72.5)

(80.2)

(0.5)

(80.7)

Income and expense for the period recognised directly in equity of companies accounted for under the equity method

1.5 

(176.7)

(175.1)

(13.1)

(188.2)

(6.1)

(249.1)

1,649.0 

78.1 

1,727.1 

393.5 

0.6 

394.1 

Total comprehensive income for the period Increase in share capital

1,904.3  31.6 

361.8 

Decrease in share capital Transactions on treasury shares

(545.2)

(78.3)

Allocation of net income and dividend payments

829.1 

Share-based payments (IFRS 2)

(623.5) (1,775.9)

69.1 

Impact of acquisitions or disposals of non-controlling interests after acquisition of control

(25.4)

0.2 

Changes in consolidation scope

(0.1)

0.1 

Other

69.7 

 

Balance at 31/12/2011

1,413.2 

7,182.4 

(1,097.5)

490.6 

3,493.9 

Net income for the period

1,904.3 

22.7 

30.2

0.5 

69.6 

(25.2)

(1.1)

(26.3)

10.4

10.4

5.3 

75.0 

69.7 

(519.8)

12,889.9 

0.6 

1.1 

1.7 

2.5 

(120.4)

(118.0)

(6.6)

(124.6)

34.3 

(151.6)

1,799.3 

103.0 

1,902.3 

305.5 

335.7   

Transactions on treasury shares

(564.3)

(82.5)

Allocation of net income and dividend payments

925.6 

(646.9) (1,904.3)

Share-based payments (IFRS 2)

65.2 

Impact of acquisitions or disposals of non-controlling interests after acquisition of control (*)

(92.0)

0.1 

(2.7)

0.2 

Changes in consolidation scope Other

(38.2) 1,443.4 

7,487.9 

(1,661.8)

490.6 

4,269.2 

1,916.7 

725.4  13,615.3 

(31.2)

Decrease in share capital

Balance at 31/12/2012

69.1 

2,025.2 

Income and expense for the period recognised directly in equity of companies accounted for under the equity method

Increase in share capital

(1,035.8)

108.5 

31.8 

1,916.7 

(89.0)

1,916.7 

Income and expense for the period recognised directly in equity of controlled companies

Total comprehensive income for the period

(946.8)

0.1 

1,916.7 

(623.5)

2.5 

  (1.4)  

335.7  (1.4) (646.9)

(978.8)

(77.8)

(1,056.6)

65.2 

0.4 

65.6 

(91.9)

(24.3)

(116.1)

8.5 

8.5 

1.5 

(36.7)

 

(0.1)

0.1 

(38.2)

57.2 

(668.8)

13,334.4 

735.4  14,069.8 

(*) Corresponding mainly to the buy-out of non-controlling interests in Entrepose Contracting, which had a negative impact of €79.7 million (amount attributable to owners of the parent) after the simplified public tender offer and squeeze-out.

202

Consolidated financial statements

A. Accounting policies and measurement methods 1.

General policies Pursuant to Regulation (EC) No. 1606/2002 of 19 July 2002, VINCI’s consolidated financial statements for the period ended 31 December 2012 have been prepared under the International Financial Reporting Standards (IFRS) as adopted by the European Union at 31 December 2012 (*). The accounting policies used at 31 December 2012 are the same as those used in preparing the consolidated financial statements at 31 December 2011, except for the Standards and Interpretations adopted by the European Union applicable as from 1 January 2012, (see Note A.1.1. “New Standards and Interpretations applicable from 1 January 2012”). The information relating to 2010, presented in the 2011 registration document D.12-0108 filed with the AMF on 27 February 2012, is deemed to be included herein. The consolidated financial statements were adopted by the Board of Directors on 5 February 2013 and will be submitted to the Shareholders’ General Meeting for approval on 16 April 2013.

1.1

1.2

New Standards and Interpretations applicable from 1 January 2012

The new Standards and Interpretations applicable from 1 January 2012 have no material impact on VINCI’s consolidated financial statements at 31 December 2012. These are mainly: ˇˇ Amendment to IFRS 7 “Disclosures – Transfers of Financial Assets”. ˇˇ IAS 12 Amended “Deferred Tax: Recovery of Underlying Assets”.

Standards and Interpretations adopted by the IASB but not yet applicable at 31 December 2012

The Group has not applied early the following Standards and Interpretations of which application was not mandatory at 1 January 2012. Standards on consolidation methods: ˇˇ IFRS 10 “Consolidated Financial Statements”; ˇˇ IFRS 11 “Joint Arrangements”; ˇˇ IFRS 12 “Disclosure of Interests in Other Entities”; ˇˇ IAS 27 Revised “Consolidated and Separate Financial Statements”; ˇˇ IAS 28 Revised “Interests in Associates and Joint Ventures”. Other standards: ˇˇ IAS 1 Amended “Presentation of Items of Other Comprehensive Income”; ˇˇ IAS 19 Amended “Employee Benefits”; ˇˇ IFRS 7 Amended “Disclosures – Offsetting Financial Assets and Financial Liabilities”; ˇˇ IFRS 13 “Fair Value Measurement”; ˇˇ IAS 32 Amended: “Offsetting Financial Assets and Financial Liabilities”; ˇˇ IFRIC 20 “Stripping Costs in the Production Phase of a Surface Mine”. VINCI is currently analysing the impacts and practical consequences of the application of these Standards and Interpretations. The amended version of IAS 19 “Employee Benefits” must be applied to accounting periods starting on or after 1 January 2013. It features several changes in the way that post-employment benefits are recognised, including the following: ˇˇ all post-employment benefits granted to Group employees must be recognised in the consolidated balance sheet. The corridor method and the ability to amortise past service cost against income over the average vesting period will no longer be possible (see Note A.3.27.1 “Provisions for retirement benefit obligations”); ˇˇ calculating the expected return on pension plan assets will now involve the discount rate used for calculating obligations with respect to defined benefit plans; ˇˇ the impacts of plan amendments must be recognised in income; ˇˇ impacts of remeasurements must be recognised in other comprehensive income: actuarial gains and losses on retirement benefit obligations, plan asset outperformance/underperformance (i.e. the difference between the effective return on plan assets and the return calculated using the discount rate applied to the actuarial liability) and changes in the asset ceiling effect. The new arrangements resulting from the revised version of IAS 19 will be applied retrospectively by the Group. The main impacts on the Group’s consolidated balance sheets at 1 January 2012 and 31 December 2012 are estimated as follows and correspond to the recognition of actuarial gains and losses and past service costs that were previously not recognised: ˇˇ an increase in provisions for retirement benefit obligations totalling €163 million at 1 January 2012 and €325 million at 31 December 2012; ˇˇ a decrease in assets recognised in the balance sheet totalling €49 million at 1 January 2012 and €69 million at 31 December 2012; ˇˇ a decrease in consolidated equity, excluding tax effects, totalling €212 million at 1 January 2012 and €394 million at 31 December 2012. A detailed analysis of the impact of the amended version of IAS 19 on the 2012 consolidated financial statements is underway. (*) Available on http://ec.europa.eu/internal_market/accounting/ias/index_en.htm

VINCI 2012 Annual Report

203

Consolidated financial statements

2.

Consolidation methods

2.1

Consolidation scope and methods Companies in which the Group holds, whether directly or indirectly, the majority of voting rights enabling control to be exercised, are fully consolidated. Companies that are less than 50% owned but in which VINCI exercises de facto control – i.e. has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities – are consolidated using this same method. This relates mainly to CFE, a Belgian construction group quoted on the Brussels stock market, of which VINCI owns 46.84% and over which it has de facto control in view in particular of the widely held nature of that company’s shareholder register. Jointly controlled operations and assets are recognised on the basis of the Group’s share of the assets, liabilities, income and expenses. This relates mainly to construction operations carried out in partnership, in the form of consortia or joint ventures, in the Contracting business and at VINCI Immobilier. Companies over which the Group exercises significant influence and joint ventures are accounted for under the equity method. When determining its level of control over an entity, VINCI also analyses any instruments held by the Group or by third parties which, if exercised, could cause the Group to obtain or lose control of the entity concerned. VINCI’s consolidated financial statements include the financial statements of all companies with revenue of more than €2 million, and of companies whose revenue is below this figure but whose impact on the Group’s financial statements is material.

Number of companies by reporting method 31/12/2012

31/12/2011

(number of companies)

Total

France

Foreign

Total

France

Controlled companies

1,995 

1,224 

771 

1,907 

1,197 

710 

355 

58 

297

339 

66 

273

2,350 

1,282 

1,068

2,246 

1,263 

983 

Equity method Total

Foreign

The main changes in the period relate to the acquisition of the Carmacks group in Alberta, Canada (six companies) and NAPC in India (one company) by Eurovia in the first half of 2012, and of GA Gruppe in Germany (14 companies plus a newly created holding company) by VINCI  Energies in the second half of 2012. Gefyra, which holds the concession for the Rion–Antirion bridge in Greece and was fully consolidated until 1 October 2012, has since that date been accounted for under the equity method after a change in the Group’s ability to exert sole control over the company. The increase in the number of consolidated companies is mainly the result of changes to VINCI Energies’ operational organisation during the year. This led to the creation of 41 companies and the combination of eight others within VINCI Energies France. Other acquisitions during the period mainly concerned VINCI Concessions (four companies), VINCI Energies (17 companies), VINCI Construction (11 companies) and Eurovia (four companies).

2.2

2.3

2.4

Intragroup transactions

Reciprocal operations and transactions relating to assets and liabilities, income and expenses between companies that are consolidated or accounted for under the equity method are eliminated in the consolidated financial statements. This is done: ˇˇ for the full amount if the transaction is between two controlled subsidiaries; ˇˇ applying the percentage owned of a company accounted for under the equity method in the case of profits or losses realised between a controlled company and a company accounted for under the equity method.

Translation of the financial statements of foreign companies and establishments

In most cases, the functional currency of companies and establishments is their local currency. The financial statements of foreign companies of which the functional currency is different from that used in preparing the Group’s consolidated financial statements are translated at the closing rate for balance sheet items and at the average rate for the period for income statement items. Any resulting translation differences are recognised under translation differences in consolidated reserves. Goodwill relating to foreign entities is considered as comprising part of the assets and liabilities acquired and is therefore translated at the exchange rate in force at the balance sheet date.

Foreign currency transactions

Transactions in foreign currency are translated into euros at the exchange rate at the transaction date. At the balance sheet date, financial assets and monetary liabilities denominated in foreign currencies are translated at the closing rate. Resulting exchange gains and losses are recognised under foreign exchange gains and losses and are shown under other financial income and other financial expense in the income statement. Foreign exchange gains and losses arising on loans denominated in foreign currency or on foreign currency derivative instruments qualifying as hedges of net investments in foreign subsidiaries, are recorded under currency translation differences in equity.

204

2.5

2.6

2.7

Consolidated financial statements

Business combinations

Business combinations completed between 1 January 2004 and 31 December 2009 were recognised applying the provisions of the previous version of IFRS 3. Business combinations completed from 1 January 2010 onwards have been recognised in accordance with IFRS 3 Revised. This Standard has been applied prospectively. It has therefore not affected business combinations made before 1 January 2010. In application of this revised Standard, the Group recognises the identifiable assets and liabilities assumed at their fair value at the dates when control was acquired. The cost of a business combination is the fair value, at the date of exchange, of the assets given, liabilities assumed, and/ or equity instruments issued by the acquirer in exchange for control of the acquiree. Contingent price adjustments are measured at fair value at each balance sheet date. After 12 months have elapsed from the acquisition date, any subsequent changes to this fair value are recognised in profit or loss. Expenses that are directly attributable to the acquisition, such as professional fees for due diligence and other related fees, are expensed as they are incurred. Non-controlling interests in the acquiree are measured either at their share of the acquiree’s net identifiable assets, or at their fair value. This option is applied on a case-by-case basis for each acquisition. The cost of acquisition is allocated by recognising the acquiree’s identifiable assets and liabilities assumed at their fair value at that date, except for assets or asset groups classified as held for sale under IFRS 5, which are recognised at their fair value less costs to sell. The positive difference between the cost of acquisition and the fair value of the identifiable assets and liabilities acquired constitute goodwill. Where applicable, the cost of acquisition can include the fair value of non-controlling interests if the full goodwill method has been selected. The Group has 12 months from the date of acquisition to finalise the accounting for business combinations. In the case of a business combination achieved in stages, previously acquired shareholdings in the acquiree are measured at fair value at the date of acquisition of control. Any resulting gain or loss is recognised in profit or loss.

Transactions between shareholders, acquisitions and disposals of non-controlling interests after acquisition of control

In accordance with IAS 27 Revised, acquisitions or disposals of non-controlling interests, with no impact on control, are considered as transactions with the Group’s shareholders. Under this approach, the difference between the consideration paid to increase the percentage shareholding in an already-controlled entity and the supplementary share of equity thus acquired is recorded under consolidated equity. Similarly, a decrease in the Group’s percentage interest in an entity that continues to be controlled is booked in the accounts as a transaction between shareholders, with no impact on profit or loss.

Discontinued operations (halted or sold), operations and assets classified as held for sale Discontinued operations Whenever discontinued operations (halted or sold) or operations classified as held for sale are: ˇˇ a business line or a geographical area of business that is material for the Group and that forms part of a single disposal plan; or ˇˇ a subsidiary acquired exclusively with a view to resale; they are shown on a separate line of the consolidated income statement at the balance sheet date. Assets connected with discontinued operations, if held for sale, are measured at the lower of their carrying amount and their estimated selling price less costs to sell. Income statement and cash flow items relating to these discontinued operations are shown on a separate line for all the periods presented. Assets classified as held for sale Non-current assets of which the sale has been decided during the period are shown on a separate line of the balance sheet whenever the sale is expected to be completed within 12 months. Such assets are measured at the lower of their carrying amount and their estimated selling price less costs to sell. Contrary to discontinued operations, income statement and cash flow items relating to assets classified as held for sale are not shown on a separate line.

3.

Measurement rules and methods

3.1

Use of estimates

The preparation of financial statements under IFRSs requires estimates to be used and assumptions to be made that affect the amounts shown in those financial statements. These estimates assume the operation is a going concern and are made on the basis of the information available at the time. Estimates may be revised if the circumstances on which they were based alter or if new information becomes available. Actual results may be different from these estimates. The consequence of the economic and financial crisis in Europe, in particular financial market volatility, access to finance and economic growth, makes it difficult to assess the outlook for business in the medium term. The consolidated financial statements for the period have therefore been prepared with reference to the immediate environment, in particular as regards the estimates given below.

VINCI 2012 Annual Report

3.1.1

3.1.2

3.1.3

3.1.4

3.1.5

3.1.6

Consolidated financial statements

205

Measurement of construction contract profit or loss using the stage of completion method

The Group uses the stage of completion method to recognise revenue and profit or loss on construction contracts, applying the general revenue recognition rules on the basis of the stage of completion. The stage of completion and the revenue to recognise are determined on the basis of a large number of estimates based on monitoring of the work performed and using the benefit of experience to take account of unforeseen circumstances. In consequence, adjustments may be made to initial estimates throughout the contract and may materially affect future results.

Values used in impairment tests

The assumptions and estimates made to determine the recoverable amount of goodwill, intangible assets and property, plant and equipment relate in particular to the assessment of market prospects needed to estimate the cash flows, and the discount rates adopted. Any change in these assumptions could have a material effect on the recoverable amount. The main assumptions used by the Group are described in Note E.13 “Impairment tests on goodwill and other non-financial assets”.

Measurement of share-based payment expenses under IFRS 2

The Group recognises a share-based payment expense relating to the granting to its employees of share options (offers to subscribe to or purchase shares), performance share plans and shares under the Group savings plans. This expense is measured on the basis of actuarial calculations using estimated behavioural assumptions based on observation of past behaviour. The main actuarial assumptions (expected volatility, expected return on the share, etc.) adopted by the Group are described for each plan in Note E.19 “Share-based payments”.

Measurement of retirement benefit obligations

The Group is involved in defined contribution and defined benefit retirement plans. Its obligations in connection with these defined benefit plans are measured actuarially based on assumptions such as the discount rate, the return on the investments dedicated to these plans, future increases in wages and salaries, employee turnover, mortality rates and the rate of increase of health expenses. Most of these assumptions are updated annually. Details of the assumptions used and how they are determined are given in Note E.20.1 “Provisions for retirement benefit obligations”. The Group considers that the actuarial assumptions used are appropriate and justified in the current conditions. Obligations may, however, change if assumptions change.

Measurement of provisions 

The factors that materially influence the amount of provisions relate to: ˇˇ the estimates made on a statistical basis from expenses incurred in previous years, for after-sales-service provisions; ˇˇ the forecasts of expenditures on major maintenance over several years used as a basis for the provisions for obligations to maintain the condition of infrastructure under concession. These forecasts are estimated taking account of indexation clauses included in construction and civil engineering contracts (mainly the TP01, TP02 and TP09 indices); ˇˇ the estimates of forecast profit or loss on construction contracts, which serve as a basis for the determination of losses on completion (see Note A.3.4. “Construction contracts”); ˇˇ the discount rates used to determine the present value of these provisions.

Measurement of financial instruments at fair value

Fair value is determined on the basis of the following three models or levels: ˇˇ Level 1 – quoted prices on an active market: whenever quoted prices on an active market are available, these are used in priority to determine fair value. Marketable securities and some listed bond issues are measured in this way; ˇˇ Level 2 – internal model using internal measurement techniques with observable factors: these techniques are based on usual mathematical computation methods, which incorporate observable market data (forward prices, yield curves, etc.). The calculation of the fair value of most derivative financial instruments (swaps, caps, floors, etc.) traded on markets is made on the basis of models commonly used by market participants to price such financial instruments. Every quarter, the internally calculated values of derivative instruments are checked for consistency with the values sent to VINCI by the counterparties. ˇˇ Level 3 – internal model using non-observable factors: this model applies in VINCI only for holdings of unlisted shares, which, in the absence of an active market, are measured at their cost of acquisition plus transaction costs.

3.2 Revenue

Consolidated revenue of the Contracting business (VINCI Energies, Eurovia and VINCI Construction) is recognised in accordance with IAS 11 “Construction Contracts”. It includes the total of the work, goods and services generated by the consolidated subsidiaries pursuing their main activity and the revenue for construction work on infrastructure under concession. The method for recognising revenue under construction contracts is explained in Note A.3.4 “Construction contracts” below. Consolidated revenue of the Concessions business is recognised in accordance with IAS 18 “Revenue” and IAS 11. The method for recognising revenue in respect of concession contracts is explained in Note A.3.5 “Concession contracts” below. It comprises: ˇˇ tolls for the use of motorway infrastructure operated under concession, revenue booked by car parks and airport service concessions, and ancillary income such as fees for the use of commercial installations, rental of telecommunications infrastructure and advertising space; and ˇˇ revenue in respect of the construction of new concession infrastructure recognised on a stage of completion basis in accordance with IAS 11. In the property sector, revenue arising on lots sold is recognised as the property development proceeds (in accordance with IFRIC 15 “Agreements for the Construction of Real Estate”).

206

3.3 3.4

3.5

Consolidated financial statements

Revenue from ancillary activities

Revenue from ancillary activities mainly comprises rental income, sales of equipment, materials and merchandise, study work and fees other than those generated by concession operators.

Construction contracts

The Group recognises construction contract income and expenses using the stage of completion method defined by IAS 11. For the VINCI  Construction business line, the stage of completion is usually determined on a physical basis. For the other business lines (Eurovia and VINCI Energies), it is determined on the basis of the percentage of total costs incurred to date. If the estimate of the final outcome of a contract indicates a loss, a provision is made for the loss on completion regardless of the stage of completion, based on the best estimates of income, including, if need be, any rights to additional revenue or claims if these are probable and can be reliably estimated. Provisions for losses on completion are shown under liabilities. Part payments received under construction contracts before the corresponding work has been carried out are recognised under liabilities under advances and payments on account received.

Concession contracts

Under the terms of IFRIC 12 “Service Concession Arrangements”, a concession operator has a twofold activity: ˇˇ a construction activity in respect of its obligations to design, build and finance a new asset that it makes available to the grantor: revenue is recognised on a stage of completion basis in accordance with IAS 11; ˇˇ an operating and maintenance activity in respect of concession assets: revenue is recognised in accordance with IAS 18. In return for its activities, the operator receives remuneration from either: Users: the intangible asset model applies. The operator has a right to receive tolls (or other payments) from users in consideration for the financing and construction of the infrastructure. The intangible asset model also applies whenever the concession grantor remunerates the concession operator based on the extent of use of the infrastructure by users, but with no guarantees as to the amounts that will be paid to the operator (under a simple pass through or shadow toll agreement). Under this model, the right to receive toll payments (or other remuneration) is recognised in the concession operator’s balance sheet under “Concession intangible assets”. This right corresponds to the fair value of the asset under concession plus the borrowing costs capitalised during the construction phase. It is amortised over the term of the arrangement in a manner that reflects the pattern in which the asset’s economic benefits are consumed by the entity, starting from the entry into service of the asset. This treatment applies to most of the infrastructure concessions, in particular the motorway networks in France, certain bridges and most of the parking facilities managed under concession by VINCI Park. ˇˇ The grantor: the financial asset model applies. The operator has an unconditional contractual right to receive payments from the concession grantor, irrespective of the amount of use made of the infrastructure. Under this model, the operator recognises a financial asset, attracting interest, in its balance sheet, in consideration for the services it provides (design, construction etc.). Such financial assets are recognised in the balance sheet under “Loans and receivables”, in an amount corresponding to the fair value of the infrastructure on first recognition and subsequently at amortised cost. The receivable is settled by means of the grantor’s payments received. The financial income calculated on the basis of the effective interest rate, equivalent to the project’s internal rate of return, is recognised under operating income. ˇˇ

In the case of bifurcated models, the operator is remunerated partly by users and partly by the grantor. The part of the investment that is covered by an unconditional right to receive payments from the grantor (in the form of grants or rental) is recognised as a financial receivable up to the amount guaranteed. The unguaranteed balance, of which the amount is dependent on the extent of use of the infrastructure, is recognised under “concession intangible assets”.

3.6

3.6.1

3.6.2

Share-based payments

The measurement and recognition methods for share subscription and purchase plans, the Plans d’Epargne Groupe (Group savings plans) and performance share plans, are defined by IFRS 2 “Share-based Payment”. The granting of share options, performance shares and offers to subscribe to Group savings plans in France and abroad represent a benefit granted to their beneficiaries and therefore constitute supplementary remuneration borne by VINCI. Because such transactions do not give rise to monetary transactions, the benefits granted in this way are recognised as expenses in the period in which the rights are acquired, with a corresponding increase in equity. Benefits are measured on the basis of the fair value at the grant date of the equity instruments granted. Benefits granted under share option plans, performance share plans and Group savings plans are implemented as decided by VINCI’s Board of Directors after approval by the Shareholders’ General Meeting, and are not, in general, systematically renewed. As their measurement is not directly linked to the business lines’ operations, VINCI has considered it appropriate not to include the corresponding expense in the operating income from ordinary activities, which is an indicator of business lines’ performance, but to report it on a separate line, labelled “Share-based payment expense (IFRS 2)”, in operating income.

Share subscription or purchase option plans

Options to subscribe to or purchase shares have been granted to Group employees and senior executives. For some of these plans, definitive vesting of share subscription or purchase option plans is conditional on performance conditions (stock market performance or financial criteria) being met. The fair value of options is determined, at grant date, using the Monte Carlo valuation model, taking account of the impact of the market performance condition if applicable. The Monte Carlo model allows a larger number of scenarios to be modelled, by including in particular the valuation of assumptions about beneficiaries’ behaviour on the basis of historical observations.

Performance share plans

Performance shares subject to vesting conditions have been granted to Group employees and senior executives. As these are plans under which the final vesting of the shares may be dependent on the realisation of financial criteria, the fair value of the shares has been estimated, at grant date, taking account of the likelihood of the financial criteria being met, as recommended by IFRS 2.

VINCI 2012 Annual Report

Consolidated financial statements

207

The number of performance shares measured at fair value in the calculation of the IFRS 2 expense is adjusted at each balance sheet date for the impact of the change in the likelihood of the financial criteria being met.

3.6.3

3.7

3.8

3.9

3.10

3.11

Group savings plans

In France, VINCI issues new shares reserved for its employees three times a year with a subscription price that includes a discount against the average stock market price of the VINCI share during the last 20 business days preceding the authorisation by the Board of Directors. This discount is considered as a benefit granted to the employees; its fair value is determined using the Monte Carlo valuation model at the date on which the subscription price is announced to the employees. As certain restrictions apply to the sale or transfer of shares acquired by employees under these plans, the fair value of the benefit to the employee takes account of the fact that the shares acquired cannot be freely disposed of for five years other than in certain specific circumstances. The Group recognises the benefits granted in this way to its employees as an expense over the vesting period, with a corresponding increase in consolidated equity. Outside France, in accordance with authorisations given to the Board of Directors by the Shareholders’ General Meeting, VINCI has set up Group savings plans for the employees of certain foreign subsidiaries in 14 countries. These plans have different characteristics from those for employees in France, partly to ensure that the plans’ value is consistent across all countries despite varying tax and regulatory arrangements. Details of the plans are set out in the relevant Note to the financial statements.

Cost of net financial debt

The cost of net financial debt includes: ˇˇ the cost of gross financial debt, which includes the interest expense calculated at the effective interest rate, and gains and losses on interest rate derivatives allocated to gross financial debt whether designated as hedges for accounting purposes or not; and ˇˇ the line item “financial income from cash management investments”, which comprises the return on investments of cash and cash equivalents. Investments of cash and cash equivalents are measured at fair value through profit or loss.

Other financial income and expense

Other financial income and expense comprises mainly foreign exchange gains and losses, the effects of discounting to present value, dividends received from unconsolidated entities, capitalised borrowing costs, and changes in the value of derivatives not allocated to managing interest rate or exchange rate risk. Borrowing costs borne during construction relate to concession assets and are mainly included in the cost of those assets. They are determined as follows: ˇˇ to the extent that funds are borrowed specifically for the purpose of constructing an asset, the borrowing costs eligible for capitalisation on that asset are the actual borrowing costs incurred during the period less any investment income arising from the temporary investment of those borrowings; ˇˇ when borrowing is not intended to finance a specific project, the interest eligible for capitalisation on an asset is determined by applying a capitalisation rate to the expenditure on that asset. This capitalisation rate is equal to the weighted average of the costs of borrowing funds for construction work, other than those specifically intended for the construction of given assets. This does not relate to the construction of infrastructure under concession accounted for using the financial asset model (see Note A.3.20.2 “Loans and receivables at amortised cost”).

Income tax

Income tax is computed in accordance with the tax legislation in force in the countries where the income is taxable. In accordance with IAS 12, deferred tax is recognised on the temporary differences between the carrying amount and the tax base of assets and liabilities. It is calculated using the latest tax rates enacted or substantively enacted at the accounts closing date, which are applied according to the schedule for reversing temporary differences. The effects of a change in the tax rate from one period to another are recognised in the income statement in the period in which the change occurs. Deferred tax relating to items recognised directly under equity, in particular share-based payment expenses (under IFRS 2), is also recognised under equity. Whenever subsidiaries have distributable reserves, a deferred tax liability is recognised in respect of the probable distributions that will be made in the foreseeable future. Moreover, shareholdings in companies accounted for under the equity method give rise to recognition of a deferred tax liability in respect of all the differences between the carrying amount and the tax base of the shares. Net deferred tax is determined on the basis of the tax position of each entity or group of entities included in the tax group under consideration and is shown under assets or liabilities for its net amount per taxable entity. Deferred tax is reviewed at each balance sheet date to take account in particular of the impact of changes in tax law and the prospect of recovery. Deferred tax assets are only recognised if their recovery is probable. Deferred tax assets and liabilities are not discounted.

Earnings per share

Basic earnings per share is the net income for the period after non-controlling interests, divided by the weighted average number of shares outstanding during the period less treasury shares. In calculating diluted earnings per share, the average number of shares outstanding is adjusted for the dilutive effect of equity instruments issued by the Company, in particular share subscription or purchase options and performance shares.

Concession intangible assets

Concession intangible assets correspond to the concession operator’s right to operate the asset under concession in consideration for the investment expenditures incurred for the design and construction of the asset. This operator’s right corresponds to the fair value of the construction of the asset under concession plus the borrowing costs capitalised during the construction phase. It is amortised over the term of the contract in a manner that reflects the pattern in which the contract’s economic benefits are consumed by the entity, starting from the

208

Consolidated financial statements

date when the right to operate starts to be used. For concessions that have recently entered into service, the amortisation is calculated using the progressive, straight-line or diminishing balance method, on the basis of the forecast traffic levels included in the business plan. In the particular case of the motorway operating companies ASF, Cofiroute and Escota, the straight-line method is used.

3.12 Goodwill

Goodwill is the excess of the cost of a business combination over the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities at the date(s) of acquisition, recognised on first consolidation. Goodwill in fully consolidated subsidiaries is recognised under goodwill in consolidated assets. Goodwill relating to companies accounted for under the equity method is included in the line item “Investments in companies accounted for under the equity method”. Goodwill is not amortised but is tested for impairment at least annually and whenever there is an indication that it may be impaired. Whenever goodwill is impaired, the difference between its carrying amount and its recoverable amount is charged to operating income in the period and is not reversible. Negative goodwill is recognised directly in profit or loss in the year of acquisition. Following adoption of IFRS 3 Revised, an option is available to measure non-controlling interests on the acquisition date either at fair value (the full goodwill method) or for the portion of the net assets acquired that they represent (the partial goodwill method). The choice can be made for each business combination.

3.13

3.14 3.15

Other intangible assets

Other intangible assets mainly comprise operating rights, brands, quarrying rights of finite duration and computer software. Other purchased intangible assets are measured at cost less any amortisation or cumulative impairment losses. Quarrying rights are amortised as materials are extracted (volumes extracted during the period are compared with the estimated total volume to be extracted from the quarry over its useful life) in order to reflect the decline in value due to depletion. Other intangible assets are amortised on a straight-line basis over their useful life.

Grants related to assets

Grants related to assets are presented in the balance sheet as a reduction of the amount of the asset for which they were received.

Property, plant and equipment

Items of property, plant and equipment are recorded at their acquisition or production cost less cumulative depreciation and any impairment losses. They are not revalued. They also include concession operating assets that are not controlled by the grantor but that are necessary for operation of the concession such as buildings intended for use in the operation, equipment for toll collection, signage, data transmission and videosurveillance, and vehicles and equipment. Depreciation is generally calculated on a straight-line basis over the period of use of the asset. Accelerated depreciation may, however, be used when it appears more appropriate to the conditions under which the asset is used. For certain complex assets comprising several components, in particular buildings and constructions, each component of the asset is depreciated over its own period of use. In the particular case of quarries, they are depreciated as materials are extracted (volumes extracted during the period are compared with the estimated total volume to be extracted from the quarry over its useful life) in order to reflect the consumption of the economic benefits. The main periods of use of the various categories of items of property, plant and equipment are as follows: Constructions: - structure

Between 20 and 50 years

- general technical installations

Between 5 and 20 years

Site equipment and technical installations

Between 3 and 12 years

Vehicles

Between 3 and 5 years

Fixtures and fittings

Between 8 and 10 years

Office furniture and equipment

Between 3 and 10 years

Depreciation commences as from the date when the asset is ready to enter into service.

3.16

3.17

Finance leases

Assets acquired under finance leases are recognised as non-current assets whenever the effect of the lease is to transfer to the Group substantially all the risks and rewards incidental to ownership of these assets, with recognition of a corresponding financial liability. Assets held under finance leases are depreciated over their period of use.

Investment property

Investment property is property held to earn rentals or for capital appreciation. Such property is shown on a separate line in the balance sheet. It is recorded at its acquisition cost less cumulative depreciation and any impairment losses, in the same way as items of property, plant and equipment.

VINCI 2012 Annual Report

3.18

3.19

Consolidated financial statements

209

Impairment of non-financial non-current assets

Under certain circumstances, impairment tests must be performed on intangible assets and property, plant and equipment. For intangible assets with an indefinite useful life, goodwill and construction work in progress, a test is performed at least annually and whenever there is an indication of a loss of value. For other fixed assets, a test is performed only when there is an indication of a loss of value. In accordance with IAS 36, the criteria adopted to assess indications that an asset might be impaired are either external (e.g. a material change in market conditions) or internal (e.g. a material reduction in revenue), without distinction. Assets to be tested for impairment are grouped within cash-generating units that correspond to homogeneous groups of assets that generate identifiable cash inflows from their use. Whenever the recoverable value of a cash-generating unit is less than its carrying amount, an impairment loss is recognised in operating income. The recoverable amount of a cash-generating unit is the higher of its fair value less costs to sell and its value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit. The discount rate is determined for each cash-generating unit taking account of its geographical location and the risk profile of its business.

Investments in companies accounted for under the equity method

Equity-accounted investments are initially recognised at cost of acquisition, including any goodwill arising. Their carrying amount is then increased or decreased to recognise the Group’s share of the entity’s profits or losses after the date of acquisition. Whenever losses are greater than the value of the Group’s net investment in the equity-accounted entity, these losses are not recognised unless the Group has entered into a commitment to recapitalise the entity or provide it with funding. The share of the negative net equity of companies accounted for under the equity method arising from decreases in the fair value of financial hedging instruments is presented under provisions for financial risks. If there is an indication that an investment may be impaired, its recoverable value is tested as described in Note A.3.18 “Impairment of nonfinancial non-current assets”. Impairment losses shown by these impairment tests are recognised as a deduction from the carrying amount of the corresponding investments. In order to present business lines’ operational performance in the best way possible, the income or loss of companies accounted for under the equity method is reported on a specific line, between the “operating income from ordinary activities” and “operating income” lines. These shareholdings are in companies in which the Group has significant influence and in jointly controlled entities.

3.20 Other non-current financial assets

Other non-current financial assets comprise available-for-sale securities, the part at more than one year of loans and receivables measured at amortised cost, the part at more than one year of financial receivables under public-private partnership contracts (PPPs) and the fair value of derivative financial instruments designated as hedges maturing after one year (see Note A.3.29.2 “Fair value of derivative instruments (assets and liabilities)”).

3.20.1 Available-for-sale securities

“Available-for-sale securities” comprises the Group’s shareholdings in unconsolidated companies. At the balance sheet date, available-for-sale securities are measured at their fair value. The fair value of shares in listed companies is determined on the basis of the stock market price at the relevant balance sheet date. For unlisted securities, if their fair value cannot be determined reliably, the securities continue to be measured at their original cost, i.e. their cost of acquisition plus transaction costs. Changes in fair value are recognised directly in equity. Whenever there is an objective indication that such an asset is impaired, the corresponding loss is recognised in profit or loss and may not be reversed. ˇˇ For securities quoted on an active market, a long-lasting or material decline in fair value below their cost is an objective indication of their impairment. The factors considered by the Group in assessing the long-lasting or material nature of a decline in fair value are generally the following: – the impairment is long-lasting whenever the closing stock market price has been lower than the cost of the security for more than 18 months; – the impairment is material whenever, at the balance sheet date, there has been a 30% fall in the current market price compared with the cost of the financial asset. ˇˇ For unlisted securities, the factors considered are the decrease in value of the share of equity held and the absence of prospects for generating profits.

3.20.2 Loans and receivables at amortised cost

“Loans and receivables at amortised cost” mainly comprises receivables connected with shareholdings, current account advances to companies accounted for under the equity method or unconsolidated entities, guarantee deposits, collateralised loans and receivables and other loans and financial receivables. It also includes the financial receivables relating to concession contracts and public-private partnerships whenever the concession operator has an unconditional right to receive remuneration (generally in the form of “scheduled payments”) from the grantor. When first recognised, these loans and receivables are recognised at their fair value less the directly attributable transaction costs. At each balance sheet date, these assets are measured at their amortised cost using the effective interest method. In the particular case of receivables coming under the scope of IFRIC 12, the effective interest rate used corresponds to the project’s internal rate of return. If there is an objective indication of impairment of these loans and receivables, an impairment loss is recognised at the balance sheet date. The impairment loss, which corresponds to the difference between the carrying amount and the recoverable amount (i.e. the present value of the expected cash flows discounted using the original effective interest rate), is recognised in profit or loss. This loss may be reversed if the recoverable value increases subsequently and if this favourable change can objectively be linked to an event arising after recognition of the impairment loss.

210

3.21 3.22

Consolidated financial statements

Inventories and work in progress

Inventories and work in progress are recognised at their cost of acquisition or of production by the entity. At each balance sheet date, they are measured at the lower of cost and net realisable value.

Trade receivables and other current operating assets

“Trade receivables” and “other current operating assets” are current financial assets and are initially measured at their fair value, which is generally their nominal value, unless the effect of discounting is material. At each balance sheet date, trade receivables and other current operating assets are measured at their amortised cost less any impairment losses taking account of any likelihood of non-recovery. An estimate of the likelihood of non-recovery is made at each balance sheet date in the light of payment delays and guarantees obtained and an impairment loss is recognised if necessary.

3.23 Other current financial assets 

“Other current financial assets” comprises the fair value of derivative financial instruments (assets) not designated as hedges for accounting purposes, the part at less than one year of the fair value of derivative financial instruments (assets) designated as hedges for accounting purposes and the part at less than one year of loans and receivables reported under other non-current financial assets (see Note A.3.29.2 “Fair value of derivative financial instruments (assets and liabilities)”).

3.24

Cash management financial assets

“Cash management financial assets” comprises investments in money market securities and bonds, and units in UCITS, made with a shortterm management objective, that do not satisfy the IAS 7 criteria for recognition as cash (see Note A.3.25 “Cash and cash equivalents”). As the Group adopts fair value as being the best reflection of the performance of these assets, they are measured and recognised at their fair value, and changes in fair value are recognised through profit or loss. Purchases and sales of cash management financial assets are recognised at their transaction date. Their fair value is determined using commonly used valuation models or, for non-listed cash management assets, at the present value of future cash flows. In assessing the fair value of listed instruments, the Group uses the market price at the balance sheet date or the net asset value of UCITS.

3.25 Cash and cash equivalents

This item comprises current accounts at banks and cash equivalents corresponding to short-term, liquid investments subject to negligible risks of fluctuations of value. Cash equivalents comprise in particular monetary UCITS and certificates of deposit with maturities not exceeding three months at the origin. Bank overdrafts are not included in cash and are reported under current financial liabilities. The Group has adopted the fair value method to assess the return on its financial instruments. Changes in fair value are recognised directly in profit or loss. Their fair value is determined using commonly used valuation models or, for non-listed cash management assets, at the present value of future cash flows. In assessing the fair value of listed instruments, the Group uses the market price at the balance sheet date or the net asset value of UCITS.

3.26

3.27 3.27.1

Treasury shares and other equity instruments

Treasury shares held by the Group are booked as a deduction from equity at their cost of acquisition. Any gains or losses connected with the purchase, sale, issue or cancellation of treasury shares are recognised directly in equity without affecting the income statement. In accordance with IAS 32, equity includes perpetual subordinated bonds that meet the definition of equity instruments.

Non-current provisions

Non-current provisions comprise provisions for retirement benefit obligations and other non-current provisions.

Provisions for retirement benefit obligations

Provisions are taken in the balance sheet for obligations connected with defined benefit retirement plans, for both current and former employees (people with deferred rights or who have retired). These provisions are determined using the projected unit credit method on the basis of actuarial assessments made at each annual balance sheet date. The actuarial assumptions used to determine the obligations vary depending on the economic conditions of the country where the plan is operated. Each plan’s obligations are recognised separately. For defined benefit plans financed under external management arrangements (i.e. pension funds or insurance policies), the surplus or shortfall of the fair value of the assets compared with the present value of the obligations is recognised as an asset or liability in the balance sheet, after deduction of cumulative actuarial gains and losses and any past service cost not yet recognised in profit or loss. Past service cost corresponds to the benefits granted either when a company adopts a new defined benefit plan or when it changes the level of benefit of an existing plan. Whenever new rights to benefit are acquired as from the adoption of the new plan or the change of an existing plan, the past service cost is recognised immediately in profit or loss. Conversely, whenever adoption of a new plan or a change in a plan gives rise to the acquisition of rights after its implementation date, past service costs are recognised as an expense on a straight-line basis over the average period remaining until the corresponding rights are fully vested.

VINCI 2012 Annual Report

Consolidated financial statements

211

Actuarial gains and losses result from changes in actuarial assumptions and from experience adjustments (the effects of differences between the actuarial assumptions adopted and that which has actually occurred). Cumulative unrecognised actuarial gains and losses that exceed 10% of the higher of the present value of the defined benefit obligation and the fair value of the plan assets are recognised in profit or loss on a straight-line basis over the average expected remaining working lives of the employees in that plan. For defined benefit plans, the expense recognised under operating income or loss comprises the current service cost, the amortisation of past service cost, the amortisation of any actuarial gains and losses and the effects of any reduction or winding up of the plan. The interest cost (cost of discounting) and the expected yield on plan assets are recognised under other financial income and expenses. Commitments relating to lump-sum payments on retirement for manual construction workers, which are met by contributions to an outside multi-employer insurance fund (CNPO), are considered as being under defined contribution plans and are recognised as an expense as and when contributions are payable. The part of provisions for retirement benefit obligations that matures within less than one year is shown under current liabilities.

3.27.2

Other non-current provisions

These comprise provisions for other employee benefits, measured in accordance with IAS 19, and those provisions that are not directly linked to the operating cycle, measured in accordance with IAS 37. These are recognised whenever, at the balance sheet date, the Group has a legal or constructive present obligation towards non-Group companies arising from a past event, whenever it is probable that an outflow of resources embodying economic benefits will be required to settle this obligation and whenever a reliable estimate can be made of the amount of the obligation. These provisions are measured at their present value, corresponding to the best estimate of the outflow of resources required to settle the obligation. The part at less than one year of other employee benefits is reported under “other current liabilities”. The part at less than one year of provisions not directly linked to the operating cycle is reported under “current provisions”.

3.28 Current provisions

Current provisions are provisions directly linked to each business line’s own operating cycle, whatever the expected time of settlement of the obligation. They are recognised in accordance with IAS 37 (see above). They also include the part at less than one year of provisions not directly linked to the operating cycle. Provisions are taken for contractual obligations to maintain the condition of infrastructure under concession, principally by the motorway concession operating companies to cover the expense of major road repairs (surface courses, restructuring of slow lanes, etc.), bridges, tunnels and hydraulic infrastructure. Provisions are calculated on the basis of maintenance expense plans spanning several years, which are updated annually. These expenses are reassessed on the basis of appropriate indices (mainly the TP01, TP02 and TP09 indices). Provisions are also taken whenever recognised signs of defects are encountered on identified infrastructure. These provisions are recognised at their present value. The effect of discounting provisions is recognised under “other financial expense”. Provisions for after-sales service cover Group entities’ commitments under statutory warranties relating to completed projects, in particular 10-year warranties on building projects in France. They are estimated statistically on the basis of expenses incurred in previous years or individually on the basis of specifically identified events. Provisions for losses on completion of contracts and construction project liabilities are set aside mainly when end-of-contract projections, based on the most likely estimated outcome, indicate a loss, and when work needs to be carried out in respect of completed projects under completion warranties. Provisions for disputes connected with operations mainly relate to disputes with customers, subcontractors, joint contractors or suppliers. Restructuring provisions include the cost of plans and measures for which there is a commitment whenever these have been announced before the period end. Provisions for other current liabilities mainly comprise provisions for late delivery penalties, for individual dismissals and for other risks related to operations.

3.29

Bonds and other financial debt (current and non-current)

3.29.1 Bond loans, other loans and borrowings

These are recognised at amortised cost using the effective interest method. The effective interest rate is determined after taking account of redemption premiums and issuance expenses. Under this method, the interest expense is measured actuarially and reported under the cost of gross financial debt. The economic benefit of a loan at a significantly below-market rate of interest, which is the case in particular for project finance granted by public-sector organisations, is treated as a government grant and recognised as a reduction of the debt and the related investments, in accordance with IAS 20. Financial instruments that comprise both a liability component and an equity component, such as bonds convertible into shares, are recognised in accordance with IAS 32. The carrying amount of the compound instrument is apportioned between its liability component and its equity component, the equity component being defined as the difference between the fair value of the compound instrument and the fair value of the liability component. The liability component corresponds to the fair value of a liability with similar characteristics but without an equity component. The value attributed to the separately recognised equity component is not altered during the term of the instrument. The liability component is measured using the amortised cost method over its estimated term. Issuance costs are allocated proportionately between the liability and equity components. The part at less than one year of borrowings is included in “current borrowings”.

212

Consolidated financial statements

3.29.2 Fair value of derivative financial instruments (assets and liabilities)

The Group uses derivative financial instruments to hedge its exposure to market risks (mainly interest rates and foreign currency exchange rates). Most interest rate and foreign currency exchange rate derivatives used by VINCI are designated as hedging instruments. Hedge accounting is applicable in particular if the conditions provided for in IAS 39 are satisfied: ˇˇ at the time of setting up the hedge, there is a formal designation and documentation of the hedging relationship; ˇˇ the effectiveness of the hedging relationship must be demonstrated from the outset and at each balance sheet date, prospectively and retrospectively. The fair value of derivative financial instruments designated as hedges of which the maturity is greater than one year is reported in the balance sheet under “other non-current financial assets“ or “other loans and borrowings (non-current)”. The fair value of other derivative instruments not designated as hedges and the part at less than one year of instruments designated as non-current hedges are reported under “other current financial assets“ or “current financial liabilities”.

Financial instruments designated as hedging instruments Derivative financial instruments designated as hedging instruments are systematically recognised in the balance sheet at fair value (see Note A.3.1.6 “Measurement of financial instruments at fair value”). Nevertheless, their recognition varies depending on whether they are designated as: ˇˇ a fair value hedge of an asset or a liability or of an unrecognised firm commitment; ˇˇ a cash flow hedge; or ˇˇ a hedge of a net investment in a foreign entity. Fair value hedge A fair value hedge enables the exposure to the risk of a change in the fair value of a financial asset, a financial liability or unrecognised firm commitment to be hedged. Changes in the fair value of the hedging instrument are recognised in profit or loss for the period. The change in value of the hedged item attributable to the hedged risk is recognised symmetrically in profit or loss for the period (and adjusted to the carrying amount of the hedged item). Except for the ineffective portion of the hedge, these two revaluations offset each other within the same line items in the income statement. Cash flow hedge A cash flow hedge allows exposure to variability in future cash flows associated with an existing asset or liability, or a highly probable forecast transaction, to be hedged. Changes in the fair value of the derivative financial instrument are recognised in equity for the effective portion and in profit or loss for the period for the ineffective portion. Cumulative gains or losses in equity are taken to profit or loss under the same line item as the hedged item – i.e. under operating income and expenses for cash flows from operations and under financial income and expense otherwise – when the hedged cash flow affects profit or loss. If the hedging relationship is interrupted because it is no longer considered effective, the cumulative gains or losses in respect of the derivative instrument are retained in equity and recognised symmetrically with the cash flow hedged. If the future cash flow is no longer expected, the gains and losses previously recognised in equity are taken to profit or loss. Hedge of a net investment in a foreign entity A hedge of a net investment denominated in a foreign currency hedges the exchange rate risk relating to the net investment in a consolidated foreign subsidiary. In a similar way as for cash flow hedges, the effective portion of the changes in the value of the derivative instrument is recorded in equity under currency translation reserves and the portion considered as ineffective is recognised in profit or loss. The change in the value of the hedging instrument recognised in “translation differences” is reversed through profit or loss when the foreign entity in which the initial investment was made is disposed of. Derivative financial instruments not designated as hedging instruments Derivative financial instruments that are not designated as hedging instruments are reported in the balance sheet at fair value and changes in their fair value are recognised in profit or loss.

3.29.3 Put options granted to minority shareholders

Put options (options to sell) granted to the minority shareholders of certain Group subsidiaries are recognised under other non-current liabilities for the present value of the exercise price of the option and as a corresponding reduction of consolidated equity (non-controlling interest and equity attributable to equity holders of the parent for the surplus, if any).

3.30 Off-balance sheet commitments 

The Group’s off-balance sheet commitments are monitored through specific annual and half-year reports. Off-balance sheet commitments are reported in the appropriate Notes, as dictated by the activity to which they relate.

VINCI 2012 Annual Report

Consolidated financial statements

213

B. Business combinations 1.

Acquisition of GA Gruppe On 7 September 2012, after the European authorities gave antitrust approval, VINCI Energies completed its acquisition of the Energieversorgungstechnik (EVT) division of Swiss group Alpiq. VINCI Energies purchased 100% of the shares in the EVT division’s parent company. EVT, now known as GA Gruppe, is a group of business units offering a comprehensive range of services including engineering, planning, construction and maintenance for power transmission and distribution operators, telecommunications infrastructure operators and industrial companies. GA Gruppe is based mainly in Germany and operates through local subsidiaries in Central Europe. The purchase price of €211 million was paid in cash. In accordance with IFRS 3 Revised, VINCI is currently assessing the fair value of the assets, liabilities and contingent liabilities acquired, and determining the related deferred tax effects. Values were provisionally allocated to identifiable assets, liabilities and contingent liabilities at 7 September 2012 based on information available. They may be adjusted during the 12 months following the acquisition on the basis of new information regarding the facts and circumstances prevailing at the time of the acquisition.

Provisional determination of identifiable assets, liabilities and contingent liabilities at the acquisition date (in € millions) Assets and liabilities acquired at 7 September 2012

Fair value

Non-current assets Intangible assets Property, plant and equipment Non-current financial assets Deferred tax assets Total non-current assets

1.5  61.7  0.1  7.1  70.4 

Current assets Inventories and work in progress Trade and other operating receivables

5.3  207.5 

Other current assets

0.6 

Tax assets

5.5 

Cash and cash equivalents Total current assets

14.2  233.2 

Non-current liabilities Non-controlling interests Provisions for retirement benefit obligations and other employee benefits Deferred tax liabilities Total non-current liabilities

2.8  44.8  0.6  48.3 

Current liabilities Current provisions Trade payables Other current liabilities

6.5  54.1  103.4 

Tax liabilities

10.8

Current borrowings

48.8 

Total current liabilities Net assets acquired

223.5  31.8 

Purchase price

210.8 

Provisional goodwill

179.0 

Provisional goodwill represents the future economic benefits that VINCI expects to derive from the acquisition of GA Gruppe. It has been allocated to the “VINCI Energies Allemagne” and “VINCI Energies République Tchèque” cash-generating units for €152 million and €27 million respectively.

214

Consolidated financial statements

GA Gruppe’s contribution to VINCI’s 2012 results (in € millions) Consolidated revenue Operating income from ordinary activities Net income for the period

07/09/2012 – 31/12/2012 195.3  10.0 7.3 

For the period from 1 January 2012 to 31 December 2012, revenue, operating income from ordinary activities and net income, on the basis of the same assumptions as those retained at the acquisition date, would have been €519 million, €9.1 million and €6.6 million respectively.

2.

Other acquisitions In January 2012, Eurovia acquired 100% of NAPC, a road construction, earthworks and civil engineering company in Chennai, India, for €76 million. The provisional allocation of the purchase price, based on the fair value of identified assets acquired and liabilities and contingent liabilities assumed, resulted in €52.9 million of goodwill being recognised. In March 2012, Eurovia acquired 100% of Carmacks for €145 million. This company, based in Alberta, Canada, builds and maintains road infrastructure under long-term contracts. The provisional allocation of the Carmacks purchase price led to €21.0 million of goodwill being recognised. During 2012, Entrepose Contracting took control of Geostock, a company specialising in underground storage. Control was acquired in stages. Entrepose Contracting already had significant influence over Geostock through a 25% equity stake, and acquired an additional 25% stake in June 2012, giving it joint control. In November 2012, Entrepose Contracting acquired another 40% of the capital, taking its stake to 90% and giving it sole control of Geostock. The provisional allocation of the total €57.7 million purchase price, paid in cash, led to €23.1 million of goodwill being recognised. The Group bought out non-controlling interests in the Entrepose Contracting group through a simplified public tender offer that was completed on 30 June 2012. As a result, the Group now owns 100% of Entrepose Contracting. This transaction, which involved a cash payment of €102 million, was recognised as a transaction between shareholders in the Group’s consolidated financial statements.

C. Information by operating segment Based on the Group’s organisational structure, segment information is presented by business line. The Group consists of two core businesses (Concessions and Contracting), together with the property activities of VINCI Immobilier. The Concessions and Contracting businesses each consist of business lines: Concessions: VINCI Autoroutes: motorway concessions in France (ASF, Escota, Cofiroute and Arcour). ˇˇ VINCI Concessions: VINCI Park, VINCI Airports, VINCI Stadium, other infrastructure and public facilities. ˇˇ

Contracting: VINCI Energies: electrical works and engineering, information and communication technology, heating ventilation and air conditioning engineering, insulation and facilities management. ˇˇ Eurovia: building and maintenance of roads, motorways and railways, urban infrastructure, environmental work, production of materials, demolition, recycling and signage. ˇˇ VINCI Construction: design and construction of buildings and civil engineering infrastructure, hydraulic works, foundations, soil treatment and specialised civil engineering. ˇˇ

VINCI 2012 Annual Report

215

Consolidated financial statements

1. Revenue 1.1

Breakdown of revenue by business line 2012

2011

Change

Concessions

5,354.0 

5,296.7 

1.1%

VINCI Autoroutes

4,439.3 

4,409.0 

0.7%

914.7 

887.6 

3.1%

33,090.2 

31,495.2 

5.1%

VINCI Energies

9,016.6 

8,666.5 

4.0%

Eurovia

8,746.8 

8,721.6 

0.3%

15,326.8 

14,107.2 

8.6%

(in € millions)

VINCI Concessions Contracting

VINCI Construction VINCI Immobilier Intragroup eliminations Revenue (*) Concession subsidiaries’ revenue derived from works carried out by non-Group companies Total revenue

810.9 

698.1 

16.2%

(621.5)

(534.1)

16.4%

38,633.6 

36,955.9

4.5%

549.6 

690.2 

-20.4%

39,183.2 

37,646.1 

4.1%

(*) Excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies.

1.2

Breakdown of revenue by geographical area 2012

%

2011

%

24,324.2 

63.0%

23,561.8 

63.8%

United Kingdom

2,257.3 

5.8%

2,070.7 

5.6%

Germany

2,374.2 

6.1%

2,100.8 

5.7%

Central and Eastern Europe (*)

2,001.0 

5.2%

2,489.6 

6.7%

Benelux

1,614.4 

4.2%

1,570.0 

4.2%

Other European countries

1,100.6

2.8%

1,079.3

2.9%

(in € millions) France

33,671.7 

87.2%

32,872.1 

88.9%

of which European Union

32,936.5 

85.3%

32,294.0 

87.4%

North America

1,332.9 

3.5%

891.1 

2.4%

Africa

1,695.0 

4.4%

1,709.7 

4.6%

Asia Pacific

1,434.7 

3.7%

1,089.9

2.9%

499.3 

1.3%

393.1 

1.1%

4,961.9 

12.8%

4,083.8 

11.1%

38,633.6

100.0%

36,955.9 

100.0%

Europe (**)

Latin America International excluding Europe Revenue (***) Concession subsidiaries’ revenue derived from works carried out by non-Group companies. Total revenue

549.6 

690.2 

39,183.2 

37,646.1 

(**) Albania, Belarus, Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Russia, Serbia, Slovakia, Slovenia and Ukraine. (**) Including the eurozone for €28,722 million in 2012 and €28,087 million in 2011. (***) Excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies.

Revenue arising outside France amounted to €14,309 million in 2012, up 6.8% from 2011. It accounted for 37% of revenue excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies (36.2% in 2011).

216

2.

Consolidated financial statements

Other information by business line The data below is for each business line separately and is stated before elimination, at their own level, of transactions with other business lines. Data in the “Holding companies & other activities” column includes VINCI Immobilier.

2012 Concessions

(in € millions)

VINCI VINCI Autoroutes Concessions

Contracting

Total

VINCI Energies 9,016.6 

VINCI Eurovia Construction

Holding companies & other Total activities Eliminations

Total

Income statement Revenue (*) Concession subsidiaries’ works revenue

4,439.3 

914.7 

5,354.0 

778.2 

74.1 

852.2 

8,746.8 

15,326.8  33,090.2 

810.9 

(621.5) (302.6)

549.6 

Total revenue

5,217.5 

988.8 

6,206.2 

9,016.6 

8,746.8 

15,326.8 

33,090.2 

810.9 

Operating income from ordinary activities

2,019.4 

139.1 

2,158.5 

502.0 

276.5

625.0 

1,403.5 

108.7 

3,670.7 

102.9 

3,651.0 

% of revenue (*) Operating income % of revenue (*)

(924.2)

38,633.6  (**)

39,183.2 

45.5%

15.2%

40.3%

5.6%

3.2%

4.1%

4.2%

2,015.4 

136.8 

2,152.1 

476.4 

275.4

644.2 

1,396.0 

9.5%

45.4%

15.0%

40.2%

5.3%

3.1%

4.2%

4.2%

3,087.2 

284.8 

3,371.9 

531.7 

467.0 

876.3 

1,875.0 

69.5%

31.1%

63.0%

5.9%

5.3%

5.7%

5.7%

1,096.3

109.7 

1,206.0 

87.0 

256.2

322.9 

666.0 

5.0 

1,877.0 

29.7 

48.5 

78.3 

5.4 

6.1 

31.4 

42.9 

(15.0)

106.1 

9.5%

Cash flow statement Cash flows (used in)/from operations before tax and financing costs % of revenue (*) of which net depreciation and amortisation of which net provisions Operating investments (net of disposals)

171.6 

5,418.5  14.0%

(27.5)

(26.7)

(54.1)

(86.4)

(219.3)

(404.4)

(710.1)

22.1 

(742.1)

Operating cash flow

1,744.3 

222.2 

1,966.5 

316.5 

(1.0)

437.1 

752.6 

403.5 

3,122.6 

Growth investments in concessions and PPPs

(1,046.0)

(79.1)

(1,125.1)

2.4 

 

(16.8)

(14.5)

698.3 

143.1 

841.4 

318.9 

(1.0)

420.3 

738.2 

403.5 

1,983.0 

23,193.2 

1,896.4 

25,089.6 

2,259.7 

1,449.4 

(274.4)

3,434.7 

158.7 

28,683.0 

15.3 

102.8

118.1 

8.7 

107.5 

556.9 

673.1 

19.0 

810.3 

(16,616.7)

(1,440.9)

(18,057.5)

(47.4)

(135.9)

2,278.1 

2,094.8 

3,435.9 

(12,526.8)

Free cash flow (after investments)

 

(1,139.6)

Balance sheet Capital employed of which investments in companies accounted for under the equity method Net financial surplus (debt)

(*) Excluding concession subsidiaries’ works revenue. (**) Intragroup revenue of the Contracting business derived from works carried out for the Group’s concession operating companies.

217

Consolidated financial statements

VINCI 2012 Annual Report

2011 Concessions

VINCI VINCI Autoroutes Concessions

(in € millions)

Contracting

Total

VINCI Energies 8,666.5 

VINCI Eurovia Construction

Holding companies & other Total activities

Eliminations

Total

Income statement Revenue (*)

4,409.0 

887.6 

5,296.7 

978.9 

101.7 

1,080.6

Total revenue

5,388.0 

989.3 

6,377.3 

8,666.5 

8,721.6 

14,107.2 

31,495.2 

698.1 

Operating income from ordinary activities

2,018.2 

130.5 

2,148.7 

482.7 

322.2 

630.4 

1,435.3 

76.0 

3,659.9 

68.5 

3,601.0 

Concession subsidiaries’ works revenue

% of revenue

8,721.6 

14,107.2 

31,495.2 

698.1 

(534.1) (390.4) (**) (924.5)

36,955.9  690.2  37,646.1 

45.8%

14.7%

40.6%

5.6%

3.7%

4.5%

4.6%

2,015.1 

105.7 

2,120.8 

459.1 

308.8 

643.7 

1,411.7 

45.7%

11.9%

40.0%

5.3%

3.5%

4.6%

4.5%

3,058.0 

308.0 

3,366.0 

507.9 

524.3 

847.7 

1,879.9 

69.4%

34.7%

63.5%

5.9%

6.0%

6.0%

6.0%

1,063.0

108.4 

1,171.4 

82.1 

249.1 

301.9 

633.1 

6.2 

1,810.7 

6.6 

71.2 

77.8 

(6.0)

(12.8)

16.7 

(2.1)

(8.0)

67.7 

(26.0)

(29.8)

(55.8)

(88.4)

(194.3)

(334.1)

(616.8)

4.5 

(668.0)

Operating cash flow

1,687.8 

187.2 

1,875.0 

257.4

220.2 

678.9 

1,156.5

238.0 

3,269.5 

Growth investments in concessions and PPPs

(1,017.3)

(91.2)

(1,108.5)

(3.1)

 

(23.7)

(26.8)

 

(1,135.4)

670.5 

95.9 

766.4 

254.3

220.2 

655.2 

1,129.7

238.0 

2,134.2 

23,035.9 

2,176.0 

25,211.9 

1,931.8 

1,116.7

(467.7)

2,580.9 

206.6 

27,999.4 

13.2 

106.4 

119.7 

4.6 

132.3 

480.7 

617.6 

11.4 

748.6 

(1,738.5) (18,895.4)

530.7 

90.1 

2,293.3 

2,914.1 

3,391.8 

(12,589.6)

(*)

Operating income % of revenue (*)

9.9% 9.7%

Cash flow statement Cash flow (used in)/from operationsbefore tax and financing costs % of revenue (*) of which net depreciation and amortisation of which net provisions Operating investments (net of disposals)

Free cash flow (after investments)

120.3

5,366.2  14.5%

Balance sheet Capital employed of which investments in companies accounted for under the equity method Net financial surplus (debt)

(17,157.0)

(*) Excluding concession subsidiaries’ works revenue. (**) Intragroup revenue of the Contracting business derived from works carried out for the Group’s concession operating companies.

218

Consolidated financial statements

Reconciliation between capital employed and the financial statements The definition of capital employed is non-current assets less working capital requirement (including current provisions) (see Note E.21 “Working capital requirement and current provisions”) and less tax payable. Note

(in € millions)

31/12/2012

31/12/2011

Capital employed – Assets Concession intangible assets

23,499.9 

23,921.5 

– Deferred tax on ASF fair value adjustments

(1,763.1)

(1,847.2)

Goodwill, gross

6,681.6 

6,342.6 

Other intangible assets Property, plant and equipment Investment property Investments in companies accounted for under the equity method Other non-current financial assets

437.4 

374.8 

4,746.2 

4,399.1 

10.5

48.0 

810.3 

748.6 

1,715.4 

1,267.6 

– Collateralised loans and receivables (at more than one year)

16 

(2.3)

(2.1)

– Derivative non-current financial instruments (assets)

16 

(756.1)

(436.4)

Inventories and work in progress Trade and other receivables Other current operating assets

1,015.5

1,004.1

10,978.6 

10,222.0 

4,505.5 

4,131.3 

Other current non-operating assets

35.2 

46.3 

Current tax assets

87.1 

70.4 

52,001.7 

50,290.5 

Current provisions

(3,507.7)

(3,484.1)

Trade payables

(7,603.6)

(7,625.0)

(11,306.3)

(10,381.5)

Total capital employed – Assets Capital employed – Liabilities

Other current operating liabilities Other current non-operating liabilities

(539.9)

(567.8)

Current tax liabilities

(361.3)

(232.6)

(23,318.7)

(22,291.1)

28,683.0 

27,999.4 

Total capital employed – Liabilities Total capital employed

3.

Breakdown of the Concessions business data 2012 of which VINCI Autoroutes

ASF/Escota

Cofiroute

VINCI Concessions

of which VINCI Park

Total

4,439.3 

3,191.3 

1,208.2 

914.7 

614.6 

5,354.0 

778.2 

647.5 

128.0 

74.1 

19.1 

852.2 

Total revenue

5,217.5 

3,838.8 

1,336.2 

988.8 

633.8 

6,206.2 

Operating income from ordinary activities

2,019.4 

1,392.0 

610.9 

139.1 

113.9 

2,158.5 

45.5%

43.6%

50.6%

15.2%

18.5%

40.3%

2,015.4 

1,390.3 

608.4 

136.8 

110.7 

2,152.1 

45.4%

43.6%

50.4%

15.0%

18.0%

40.2%

3,087.2 

2,206.7 

855.9 

284.8 

210.1 

3,371.9 

69.5%

69.1%

70.8%

31.1%

34.2%

63.0%

1,096.3

837.0 

252.1

109.7 

75.7 

1,206.0 

(in € millions) Income statement Revenue (*) Concession subsidiaries’ works revenue

% of revenue (*) Operating income % of revenue (*) Cash flow statement Cash flows from operations before tax and financing costs % of revenue (*) of which net depreciation and amortisation of which net provisions

29.7 

17.6 

12.1 

48.5 

29.5 

78.3 

(27.5)

(23.1)

(4.3)

(26.7)

(18.7)

(54.1)

Operating cash flow

1,744.3 

1,266.6 

547.2 

222.2 

121.9

1,966.5 

Growth investments (concessions and PPPs)

(1,046.0)

(861.2)

(182.1)

(79.1)

(45.9)

(1,125.1)

698.3 

405.4 

365.1 

143.1 

76.0 

841.4 

23,193.2 

17,269.5 

5,237.1 

1,896.4 

1,243.4 

25,089.6 

15.3 

15.3 

(0.0)

102.8

40.2 

118.1 

(16,616.7)

(11,149.4)

(2,876.9)

(1,440.9)

(730.2)

(18,057.5)

Operating investments (net of disposals)

Free cash flow (after investments) Balance sheet Capital employed of which investments in companies accounted for under the equity method Net financial surplus (debt) (*) Excluding concession subsidiaries’ works revenue.

219

Consolidated financial statements

VINCI 2012 Annual Report

2011 of which VINCI Autoroutes

ASF/Escota

Cofiroute

VINCI Concessions

of which VINCI Park

Total

4,409.0 

3,169.9 

1,201.9 

887.6 

599.1 

5,296.7 

978.9 

845.5 

129.4 

101.7 

37.0 

1,080.6

Total revenue

5,388.0 

4,015.5 

1,331.3 

989.3 

636.1 

6,377.3 

Operating income from ordinary activities

2,018.2 

1,393.8 

608.1 

130.5 

107.3 

2,148.7 

(in € millions) Income statement Revenue (*) Concession subsidiaries’ works revenue

% of revenue (*) Operating income % of revenue (*)

45.8%

44.0%

50.6%

14.7%

17.9%

40.6%

2,015.1 

1,392.8 

605.9 

105.7 

107.0 

2,120.8 

45.7%

43.9%

50.4%

11.9%

17.9%

40.0%

3,058.0 

2,185.4 

848.0 

308.0 

200.9 

3,366.0 

Cash flow statement Cash flows from operations before tax and financing costs % of revenue

69.4%

68.9%

70.6%

34.7%

33.5%

63.5%

1,063.0

809.8 

246.4 

108.4 

74.9 

1,171.4 

6.6 

5.3 

1.4 

71.2 

20.5

77.8 

(26.0)

(19.4)

(2.2)

(29.8)

(22.8)

(55.8)

Operating cash flow

1,687.8 

1,204.3 

557.6 

187.2 

113.5 

1,875.0 

Growth investments (concessions and PPPs)

(1,017.3)

(841.2)

(172.1)

(91.2)

(49.1)

(1,108.5)

670.5 

363.1 

385.5 

95.9 

64.3 

766.4 

23,035.9 

17,052.5 

5,314.8 

2,176.0 

1,252.0 

25,211.9 

13.2 

13.2 

106.4 

41.5 

119.7 

(17,157.0)

(11,315.7)

(1,738.5)

(772.1)

(18,895.4)

(*)

of which net depreciation and amortisation of which net provisions Operating investments (net of disposals)

Free cash flow (after investments) Balance sheet Capital employed of which investments in companies accounted for under the equity method Net financial surplus (debt)

 

(2,959.9)

(*) Excluding concession subsidiaries’ works revenue.

4.

Capital employed by geographical area (in € millions)

Central and Eastern Europe (*)

Benelux

Other European countries

Total Europe

North America

Africa

Asia Pacific

Latin America

Total

France

Germany

United Kingdom

26,166.2

263.6 

265.4 

103.8 

923.4 

362.8 

28,085.1 

556.0 

(35.1)

2.9 

74.0 

28,683.0 

25,769.1 

78.3 

206.2 

53.4 

817.9 

654.6 

27,579.4 

361.3 

64.8 

(95.4)

89.4 

27,999.4 

31 December 2012 Capital employed 31 December 2011 Capital employed

(*) Albania, Belarus, Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Russia, Serbia, Slovakia, Slovenia and Ukraine.

Capital employed in the eurozone at 31 December 2012 was €27,577 million, of which 96% in France.

220

Consolidated financial statements

D. Notes to the income statement 5.

Operating income (in € millions)

2012

2011

Revenue (*)

38,633.6 

36,955.9

Concession subsidiaries’ revenue derived from works carried out by non-Group companies Total revenue Revenue from ancillary activities

549.6 

690.2 

39,183.2 

37,646.1 

234.4 

205.0 

Purchases consumed

(9,432.5)

(9,258.0)

External services

(5,103.9)

(4,843.9)

Temporary employees

(993.5)

(946.6)

(8,013.9)

(7,468.3)

Taxes and levies

(1,052.4)

(1,009.2)

Employment costs

(9,272.0)

(8,754.2)

Subcontracting and concession operating companies’ construction costs

Other operating income and expenses Depreciation and amortisation

38.8 

49.7 

(1,877.0)

(1,810.7)

Net provision expense

(40.4)

(150.0)

Operating expenses

(35,746.9)

(34,191.2)

3,670.7 

3,659.9 

Operating income from ordinary activities % of revenue (*)

9.5%

9.9%

Share-based payments (IFRS 2)

(94.3)

(101.4)

Goodwill impairment expense

(7.5)

(8.0)

Income/(loss) of companies accounted for under the equity method

82.1 

50.5 

3,651.0 

3,601.0 

9.5%

9.7%

Operating income % of revenue (*) (*) Excluding concession subsidiaries’ revenue derived from works carried out by non-Group companies.

Operating income from ordinary activities measures the operating performance of the Group’s subsidiaries before taking account of expenses related to share-based payments (IFRS 2), goodwill impairment losses and the share of the profit or loss of companies accounted for under the equity method.

5.1

Other operating income and expenses (in € millions)

5.2

2012

2011

Net gains or losses on disposal of property, plant and equipment and intangible assets

24.8 

24.0 

Share in operating income or loss of joint operations

11.3 

29.2 

Other

2.7 

(3.5)

Total

38.8 

49.7 

Depreciation and amortisation

Net depreciation and amortisation breaks down as follows: (in € millions) Concession intangible assets Intangible assets Property, plant and equipment Investment property Depreciation and amortisation

2012

2011

(998.4)

(971.8)

(41.5)

(38.9)

(835.1)

(795.9)

(1.9)

(4.1)

(1,877.0)

(1,810.7)

VINCI 2012 Annual Report

6.

221

Consolidated financial statements

Financial income and expense Financial income and expense breaks down as follows by accounting category of financial assets and liabilities: 31/12/2012 (in € millions) Liabilities at amortised cost

Cost of net financial debt

Other financial income and expense

Assets and liabilities at fair value through profit or loss (fair value option)

88.8 

Derivatives designated as hedges: assets and liabilities

42.1 (*)

Derivatives at fair value through profit and loss (trading): assets and liabilities

(1.0)

(244.2)

Loans and receivables

(0.3)

Available-for-sale financial assets

16.4 

Foreign exchange gains and losses

(6.2)

Effect of discounting to present value

(91.3)

Borrowing costs capitalised or in inventory

71.3 

Provisions and miscellaneous Total financial income and expense

Equity

(767.6)

17.6 

(8.8) (637.7)

(18.8)

(226.6)

Other financial income and expense

Equity

(*) Details of results of hedging derivatives are shown in the table below. 31/12/2011 (in € millions) Liabilities at amortised cost Assets and liabilities at fair value through profit or loss (fair value option) Derivatives designated as hedges: assets and liabilities Derivatives at fair value through profit and loss (trading): assets and liabilities

Cost of net financial debt (745.3)

 

95.1 

  (346.2)

7.4 (*) (3.8)

Loans and receivables

  (28.4)

 

Available-for-sale financial assets

37.9 

(19.9)

Foreign exchange gains and losses

(4.6)

 

Effect of discounting to present value

(47.3)

 

Borrowing costs capitalised or in inventory

60.9 

 

Provisions and miscellaneous Total financial income and expense

6.7  (646.6)

 

25.2 

(366.1)

(*) Details of results of hedging derivatives are shown in the table below.

The cost of net financial debt amounted to €637.7 million in 2012 compared with €646.6 million in 2011, a decrease of €8.9 million, due mainly to a €13.0 million reduction in the cost of long-term financial debt arising from: ˇˇ a fall of around €174 million in average debt outstanding, due to differences between the amounts of debt repayment and refinancing transactions (see Note E.22.1 “Detail of long-term financial debt”); ˇˇ an improvement in the average interest rate due to the impact of lower short-term rates on the cost of debt at floating and capped floating rates; ˇˇ the rates applied to new bond issues in 2011 and 2012, which were lower overall than the average rate of debts redeemed during the period. Interest received on net cash decreased as the increase of around €100 million in the average amount of net cash did not offset the impact of lower interest rates in 2012. Other financial income includes borrowing costs included in the cost of non-current assets under construction in an amount of €71.3 million in 2012 (including €70.1 million for the ASF group), compared with €60.9 million in 2011 (including €59.4 million for the ASF group). Other financial expense includes the effects of discounting assets and liabilities at more than one year to present value for €91.3 million in 2012, compared with €47.3 million in 2011. The effect of discounting to present value relates mainly to provisions for retirement benefit obligations for €42.7 million in 2012 (€41.4 million in 2011) and to provisions for the obligation to maintain the condition of concession assets for €33.7 million in 2011 (€6.6 million in 2011). Gains and losses on derivative financial instruments allocated to financial debt (and designated as hedges) break down as follows: (in € millions)

31/12/2012

31/12/2011

Net interest on derivatives designated as fair value hedges

111.0 

69.7 

Change in value of derivatives designated as fair value hedges

317.0 

248.4 

Change in value of the adjustment to fair value hedged financial debt

(313.9)

(249.4)

Reserve recycled through profit or loss in respect of cash flow hedges

(72.6)

(59.9)

of which changes in fair value of derivative instruments hedging cash flows

(16.0)

(11.6)

0.6 

(1.3)

42.1 

7.4 

Ineffectiveness of cash flow hedges Gains and losses on derivative instruments allocated to net financial debt

222

Consolidated financial statements

7.

Income tax expense

7.1

Breakdown of net tax expense (in € millions)

31/12/2012

31/12/2011

Current tax

(1,105.1)

(1,146.8)

Deferred tax

135.9 

163.2 

of which temporary differences

113.5 

160.2 

of which tax losses and tax credits Total

22.4 

3.0 

(969.2)

(983.6)

The net tax expense for the period comprises: a tax expense recognised by the French subsidiaries for €874.3 million (€873.2 million in 2011), including €170.1 million at Cofiroute (€173.9 million in 2011) and €675.5 million at VINCI SA, the lead company in the tax consolidation group that comprises 1,168 French subsidiaries (€660.7 million in 2011); ˇˇ a tax expense of €94.9 million for foreign subsidiaries (€110.4 million in 2011). ˇˇ

7.2

Effective tax rate

The effective tax rate was 33.3% in 2012 compared with 33.6% in 2011. The effective tax rate for 2012 is lower than the theoretical tax rate in force in France (36.1% taking account of the 5% exceptional surcharge), mainly because of taxation at lower rates of some foreign subsidiaries. The difference between the tax calculated using the standard tax rate in force in France and the amount of tax effectively recognised in the period can be analysed as follows: 31/12/2012

31/12/2011

Income before tax and income/(loss) of companies accounted for under the equity method

2,912.4 

2,929.2 

Theoretical tax rate in France

36.10%

36.10%

(1,051.4)

(1,057.4)

Goodwill impairment expense

(2.7)

(1.8)

Impact of taxes due on income taxed at lower rate in France

8.0 

7.2 

(12.2)

(3.0)

(in € millions)

Theoretical tax expense expected

Impact of tax loss carryforwards and other unrecognised or previously capped temporary differences

7.3

Difference in tax rates on foreign profit or loss

54.7 

90.7 

Permanent differences and other

34.3 

(19.3)

Tax expense recognised

(969.2)

(983.6)

Effective tax rate (excluding Group’s share in companies accounted for under the equity method)

33.3%

33.6%

Breakdown of deferred tax assets and liabilities Changes 31/12/2012

Profit or loss

Tax loss carryforwards and tax credits

281.0 

Retirement benefit obligations

226.9 

Temporary differences on provisions

422.3 

53.7 

Fair value adjustment on financial instruments

155.3 

(5.3)

20.5

(2.4)

0.1 

(1.1)

23.9 

Other

312.1 

3.9 

(3.4)

(7.4)

319.0 

Netting of deferred tax assets and liabilities by tax jurisdiction

(907.9)

(68.5)

(839.4)

Total

510.3 

76.3 

28.1 

(80.7)

486.5 

(in € millions)

Equity

Other

31/12/2011

18.1 

0.1 

(9.6)

272.5

8.4 

0.1 

6.2 

212.2 

0.6 

2.4 

365.6 

30.6

(2.7)

132.7 

Deferred tax assets

Finance leases

 

 

Deferred tax liabilities (2,557.6)

96.7 

(1.7)

(26.5)

(2,626.1)

Finance leases

(28.5)

1.7 

(0.1)

(0.1)

(30.0)

Fair value adjustment on financial instruments

(15.8)

4.9 

(8.4)

0.3 

(12.6)

(386.4)

(31.6)

(9.6)

(7.6)

(337.5)

Remeasurement of assets (*)

Other Netting of deferred tax assets and liabilities by tax jurisdiction

68.5 

839.4 

Total

(2,080.4)

71.8 

(19.9)

34.6 

(2,166.9)

Net deferred tax asset or liability before impairment losses

(1,570.1)

148.1 

8.3 

(46.1)

(1,680.4)

(307.6)

(12.2)

1.2 

10.8

(307.4)

(1,877.8)

135.9 

9.5 

(35.3)

(1,987.8)

Unrecognised deferred taxes Net deferred tax

907.9 

 

(*) Including measurement at fair value of the assets and liabilities of ASF at date of first consolidation: €1,763.1 million at 31 December 2012.

 

VINCI 2012 Annual Report

7.4

8.

223

Consolidated financial statements

Unrecognised deferred taxes

Deferred tax assets unrecognised due to their recovery not being probable were €307.6 at 31 December 2012 (€307.4 million at 31 December 2011).

Earnings per share Basic earnings per share are calculated on the basis of the weighted average number of shares outstanding during the period, less the weighted average number of treasury shares. Diluted earnings per share are calculated on the basis of the weighted average number of shares that would have been outstanding had all potentially dilutive instruments (in particular share subscription or purchase options and performance shares) been converted into shares. Earnings are also adjusted as necessary for changes in income and expenses resulting from the conversion into shares of all potentially dilutive instruments. The dilution resulting from the exercise of share subscription and purchase options and from performance shares is determined using the method defined in IAS 33. In accordance with this standard, plans of which the stock market price is greater than the average price during the period are excluded from the diluted earnings per share calculation. The tables below show the reconciliation between basic and diluted earnings per share: 2012

Net income (in € millions)

Total shares

(35,420,639) 1,916.7 

Subscription options

441,409 

Performance shares

2,945,869  1,916.7 

541,766,853 

3.54 

Net income (in € millions)

Average number of shares

Earnings per share (in €)

Total shares

560,976,818 

Treasury shares Basic earnings per share

(19,891,150) 1,904.3 

Subscription options

541,085,668 

3.52 

3,044,270 

Share purchase options

1,695 

Group Savings Scheme

345,942 

Performance shares Diluted earnings per share

3.57 

 

Group Savings Scheme

2011

536,801,800  1,577,775 

Share purchase options

Diluted earnings per share

Earnings per share (in €)

572,222,439 

Treasury shares Basic earnings per share

Average number of shares

2,184,725  1,904.3 

546,662,300 

3.48 

224

Consolidated financial statements

E. Notes to the balance sheet 9.

Concession intangible assets (in € millions)

VINCI Autoroutes

VINCI Park

Other infrastructure

Total concessions

Other concessions

Total

27,088.0 

1,131.8

870.1 

29,090.0 

4.0 

29,094.0 

1,036.3

28.7 

62.5 

1,127.5

(1.1)

(4.3)

(0.1)

(5.5)

1.8 

5.6 

7.4 

 

7.4 

196.8 

2.5 

(117.3)

82.0 

 

82.0 

28,319.9 

1,160.6

820.8 

30,301.3

(13.3)

 

(21.4)

(34.8)

28,306.6 

1,160.6

799.4 

30,266.6

848.0 

19.7 

55.0 

922.7 

(1.8)

(21.6)

(3.3)

(26.7)

1.7 

(3.8)

(2.1)

 

(2.1)

13.4 

(38.9)

(422.1)

(447.6)

 

(447.6)

29,166.2 

1,121.5

425.1 

30,712.8

(2.1)

 

(20.3)

(22.4)

29,164.1 

1,121.5

404.8 

30,690.4

4.0 

30,694.3

(4,511.3)

(545.4)

(262.5)

(5,319.2)

(3.1)

(5,322.3)

(916.4)

(36.0)

(30.6)

(982.9)

(0.2)

(983.1)

(46.0)

(49.0)

 

(49.0) 5.0 

Gross 01/01/2011 Acquisitions during the period (*) Disposals during the period Currency translation differences Other movements Grants received 31/12/2011 Acquisitions during the period (*) Disposals during the period Currency translation differences Other movements Grants received 31/12/2012

 

 

 

1,127.5  

4.0   

(5.5)

30,305.3 (34.8)

4.0   

30,270.5 922.7 

 

4.0   

(26.7)

30,716.8 (22.4)

Amortisation and impairment losses 01/01/2011 Amortisation in the period Impairment losses

 

(3.0)

Reversals of impairment losses

 

5.0 

 

5.0 

 

0.1 

4.2 

0.1 

4.4 

 

4.4 

 

(0.6)

(2.3)

(2.9)

 

(2.9)

Disposals during the period Currency translation differences Other movements 31/12/2011 Amortisation in the period

(51.5)

(1.5)

51.9 

(1.2)

(5,479.1)

(577.2)

(289.5)

(6,345.8)

(3.3)

 

(6,349.1)

(1.2)

(946.6)

(0.2)

(1,010.4)

(33.9)

(29.7)

(1,010.2)

Impairment losses

 

(7.9)

(12.1)

(20.1)

 

Reversals of impairment losses

 

2.3 

 

2.3 

 

2.3 

1.1 

17.6 

0.5 

19.2 

 

19.2 

Disposals during the period Currency translation differences

(0.6)

1.5 

0.8 

(0.0)

16.0 

146.8 

162.7 

(6,424.5)

(583.9)

(182.5)

(7,191.0)

(3.4)

01/01/2011

22,576.7 

586.5 

607.6 

23,770.8 

0.8 

23,771.6 

31/12/2011

22,827.5 

583.4 

509.9 

23,920.8 

0.7 

23,921.5 

31/12/2012

22,739.5 

537.6 

222.3 

23,499.4 

0.5 

23,499.9 

Other movements 31/12/2012

 

(0.0)

(20.1)

 

0.8  162.7  (7,194.4)

Net

(*) Including capitalised borrowing costs.

The investments for the period, excluding capitalised borrowing costs, amounted to €852 million (€1,067 million in 2011). They include investments made by the ASF group for €647.5 million (€845.5 million in 2011), and by Cofiroute for €127.7 million (€127.3 million in 2011). Concession intangible assets include assets under construction for €2,178.6 million at 31 December 2012 (€2,095.8 million at 31 December 2011). These relate mainly to VINCI Autoroutes subsidiaries (€2,147.7 million including €1,477 million for ASF, €573 million for Escota and €97.8 million for Cofiroute). Other changes in 2012 relate mainly to the change in the consolidation method used for Greek company Gefyra. The main features of concession and PPP contracts reported using the intangible asset model or the bifurcated model are described in Note F “Note on the main features of concession and PPP contracts”. The main commitments related to these contracts are mentioned in Note F.25.2 “Commitments made under concession contracts – intangible asset model”.

VINCI 2012 Annual Report

225

Consolidated financial statements

10. Goodwill Changes in the period were as follows: (in € millions) Net at the beginning of the period Goodwill recognised during the period

31/12/2012

31/12/2011

6,263.8 

6,103.1 

335.9 

75.4 

Impairment losses

(7.5)

(8.0)

Currency translation differences

10.2 

10.4

Entities no longer consolidated Other movements Net at the end of the period

 

(0.0)

6.9 

82.9 

6,609.3 

6,263.8 

Goodwill recognised during the period has been measured on the basis of the share in the fair value of the identifiable assets and liabilities in the companies acquired. It mainly relates to the acquisitions of GA Gruppe (VINCI Energies) for €179 million, NAPC (Eurovia) for €52.9 million, Geostock Holding (Entrepose Contracting) for €23.1 million and Carmacks Group (Eurovia) for €20.8 million. The main items of goodwill at 31 December 2012 were as follows: 31/12/2012

31/12/2011

(in € millions)

Gross

Impairment losses

Net

Net

ASF & Escota

1,934.7 

 

1,934.7 

1,934.7 

Energies France

1,791.3 

 

1,791.3 

1,785.2 

VINCI Facilities

563.1 

 

563.1 

563.0 

VINCI Park (formerly Sogeparc and Finec)

343.3 

 

343.3 

343.3 

Entrepose Contracting

200.9 

 

200.9 

200.9 

Soletanche Bachy

170.7 

 

170.7 

170.7 

Energies Germany

332.2 

 

332.2 

174.1 

Nuvia

139.1 

 

139.1 

135.9  136.3 

Energies Benelux

138.7 

 

138.7 

ETF-Eurovia Travaux Ferroviaires

107.6 

 

107.6 

107.6 

Energies Switzerland

107.2 

 

107.2 

105.7 

Taylor Woodrow Construction UK Other goodwill Total

93.7 

91.5 

759.1 

93.7 

(72.3)

 

686.8 

514.9 

6,681.6 

(72.3)

6,609.3 

6,263.8 

226

11.

Consolidated financial statements

Other intangible assets (in € millions)

Software

Patents, licences and other

Total

Gross 01/01/2011

306.1 

425.0 

731.1 

7.2 

19.1 

26.3

Other acquisitions during the period

20.5

33.4 

53.9 

Disposals during the period

(6.8)

(2.8)

(9.6)

Currency translation differences

(0.1)

0.3 

0.2 

(15.5)

1.5 

(14.0)

311.3 

476.6 

787.9 

Acquisitions as part of business combinations

Other movements 31/12/2011

5.1 

64.2 (*)

69.3 

Other acquisitions during the period

19.3 

31.6 

50.9 

Disposals during the period

Acquisitions as part of business combinations

(11.4)

(33.1)

(44.5)

Currency translation differences

0.2 

2.6 

2.9 

Other movements

8.5 

(5.4)

3.1 

333.0 

536.4 

869.4 

(259.3)

(117.0)

(376.3)

(28.2)

(10.7)

(38.9)

(0.7)

(2.1)

(2.8)

31/12/2012 Amortisation and impairment losses 01/01/2011 Amortisation in the period Impairment losses Reversals of impairment losses Disposals during the period Currency translation differences

 

1.6 

1.6 

6.6 

1.9 

8.6 

0.3 

0.4 

0.6 

18.3

(24.1)

(5.8)

(263.0)

(150.1)

(413.0)

(25.5)

(16.0)

(41.5)

Impairment losses

(0.2)

(1.9)

(2.2)

Reversals of impairment losses

0.1 

0.4 

0.4 

Disposals during the period

11.1 

27.8 

38.9 

Currency translation differences

(0.2)

(0.4)

(0.7)

Other movements

(3.5)

(10.4)

(13.9)

(281.3)

(150.7)

(432.0)

01/01/2011

46.8 

308.0 

354.9 

31/12/2011

48.3 

326.5 

374.8 

31/12/2012

51.7 

385.7 

437.4 

Other movements 31/12/2011 Amortisation in the period

31/12/2012 Net

(*) Including €63 million relating to the Carmacks acquisition.

VINCI 2012 Annual Report

12.

227

Consolidated financial statements

Property, plant and equipment Concession operating fixed assets

Land

Constructions

Plant, equipment and fixtures

Total

3,079.3 

844.1 

1,194.5 

5,716.4 

10,834.3 

2.0 

3.1 

39.2 

177.8 

222.0 

Other acquisitions during the period

216.1 

20.9

161.7 

555.9 

954.7 

Disposals during the period

(51.0)

(6.0)

(19.3)

(441.6)

(517.9)

(in € millions) Gross 01/01/2011 Acquisitions as part of business combinations

Currency translation differences

0.1 

(11.4)

(2.7)

(13.7)

(27.7)

(110.2)

0.6 

(123.9)

70.3 

(163.2)

3,136.2 

851.3 

1,249.5 

6,065.2 

11,302.2 

0.6 

12.1 

55.7 

216.5 

284.8 

Other acquisitions during the period

281.9 

13.6 

147.8 

636.2 

1,079.4

Disposals during the period

(569.8)

Other movements 31/12/2011 Acquisitions as part of business combinations

(82.0)

(11.2)

(39.8)

(436.8)

Currency translation differences

0.1 

10.0

4.9 

22.5 

37.4 

Other movements

(7.5)

1.6 

(39.7)

76.5 

30.8

3,329.2 

877.3 

1,378.4 

6,580.0 

12,164.8 

(1,693.5)

(195.8)

(515.6)

(4,017.9)

(6,422.8)

(165.7)

(19.5)

(50.0)

(562.5)

(797.6)

Impairment losses

(0.8)

(3.4)

(3.2)

(8.7)

(16.0)

Reversals of impairment losses

0.1 

2.9 

1.7 

7.6 

12.2 

Disposals during the period

47.2 

4.7 

9.0 

367.7 

428.7 

Currency translation differences

(0.0)

1.9 

1.2 

8.0 

11.0 

Other movements

(1.2)

(23.1)

(4.4)

(89.8)

(118.6)

(1,813.9)

(232.3)

(561.3)

(4,295.6)

(6,903.1)

(165.4)

(17.1)

(55.2)

(600.1)

(837.7)

Impairment losses

(0.3)

(0.9)

(10.0)

(8.3)

(19.5)

Reversals of impairment losses

0.8 

1.7 

2.4 

9.4 

14.4 

Disposals during the period

77.9 

4.0 

21.3 

401.9 

505.1 

Currency translation differences

(0.0)

(1.7)

(1.8)

(15.0)

(18.6)

Other movements

0.5

2.0

(43.8)

(118.0)

(159.3)

(1,900.3)

(244.4)

(648.3)

(4,625.7)

(7,418.6)

01/01/2011

1,385.7 

648.3 

678.9 

1,698.5 

4,411.5 

31/12/2011

1,322.3 

619.0 

688.2 

1,769.6 

4,399.1 

31/12/2012

1,428.9 

632.9 

730.1 

1,954.3 

4,746.2 

31/12/2012 Depreciation and impairment losses 01/01/2011 Depreciation in the period

31/12/2011 Depreciation in the period

31/12/2012 Net

Property, plant and equipment includes assets under construction not yet in service for €521.6 million at 31 December 2012 (€387.1 million at 31 December 2011). At 31 December 2012, assets acquired under finance leases amounted to €129.8 million (€133.3 million at 31 December 2011). They relate mainly to property used in operations. The debts relating to these assets are shown in Note E.22.1 “Detail of long-term financial debt”.

13.

Impairment tests on goodwill and other non-financial assets In accordance with IAS 36 “Impairment of Assets”, goodwill and other non-financial assets were tested for impairment at 31 December 2012. Cash-generating units (CGUs) are identified in line with operational reporting and their recoverable amounts are based on a value in use calculation. The value in use of each CGU is determined by discounting the forecasted operating cash flows before tax (operating income plus depreciation and amortisation plus non-current provisions less operating investments less change in operating WCR), at the rates below. In the case of concessions, forecast cash flows are determined across the length of contracts by applying a variable discount rate, determined for each period depending on the debt to equity ratio of the entity in question. For the other CGUs, forecast cash flows are generally determined on the basis of the latest three-year forecasts available. For periods beyond the three-year period, cash flows are extrapolated until the fifth year, generally using a growth rate based on management’s assessment of the outlook for the entity under consideration. Beyond the fifth year, the terminal value is determined by capitalising cash flows to infinity.

228

13.1

Consolidated financial statements

Impairment tests on goodwill

Goodwill was tested for impairment using the following assumptions:

(in € millions)

Parameters of the model applied to cash flow forecasts

Carrying amount of goodwill Growth rate 31/12/2012 (years n+1 to n+5)

Growth rate (terminal value)

Impairment losses recognised in the period

Discount rate 31/12/2012

31/12/2011

2012 

2011 

ASF group

1,934.7 

(*)

(*)

9.1%

9.7%

 

 

VINCI Energies France

1,791.3 

2.4%

1.0%

12.1%

12.2%

 

 

VINCI Facilities

563.1 

0.9%

1.0%

11.7%

11.8%

 

 

VINCI Park

343.3 

(*)

(*)

9.0%

9.1%

 

 

VINCI Energies Germany

332.2 

3.0%

1.0%

10.0%

9.6%

 

 

Entrepose Contracting

200.9 

6.8%

1.0%

11.2%

11.6%

 

 

Soletanche Bachy

170.7 

2.7%

1.5%

10.6%

11.4%

 

Other goodwill

1,273.2 

-3% to 5%

1% to 5%

8.5% to 16.7%

7.5% to 31.4%

Total

6,609.3 

 

(7.5)

(8.0)

(7.5)

(8.0)

(*) For concessions, cash flow projections are determined over the length of concession contracts using an average revenue growth rate of 0.9% for the ASF group (taking account of the end of the Escota concession in 2028; the average growth rate for the period that is common to the ASF and Escota concessions is 2.1%) and 3% overall for VINCI Park.

The tests performed at 31 December 2012 led to the recognition of impairment losses of €7.5 million (€8 million at 31 December 2011). Sensitivity of the value in use of cash-generating units to the assumptions made The following table shows the sensitivity of the enterprise value to the assumptions made for the main goodwill items:

Sensitivity to interest rates Discount rate for cash flows

Perpetual growth rate for cash flows

(in € millions)

0.50%

-0.50%

0.50%

ASF group

(832.1)

887.8

(*)

(*)

VINCI Energies France

(122.9)

134.4

93.3

(85.3)

VINCI Facilities

-0.50%

(25.0)

27.5

19.6

(17.8)

(150.6)

185.8

(*)

(*)

VINCI Energies Germany

(48.4)

54.0

40.1

(35.9)

Entrepose Contracting

(22.5)

24.9

21.6

(19.6)

Soletanche Bachy

(92.1)

102.8

76.3

(68.3)

VINCI Park

(*) Forecasts of cash flows are determined over the periods of the concession contracts.

At 31 December 2012, a change of 50 basis points in the assumptions adopted would not have a material impact on the Group’s consolidated financial statements.

Sensitivity to cash flows Change in forecast operating cash flows (in € millions)

5.0%

ASF group

922.7

(922.7)

VINCI Energies France

148.3

(148.3)

VINCI Facilities

-5.0%

27.3

(27.3)

107.7

(105.3)

VINCI Energies Germany

46.9

(46.9)

Entrepose Contracting

23.8

(23.8)

Soletanche Bachy

90.3

(90.3)

VINCI Park

At 31 December 2012, a 5% increase or decrease in forecast operating cash flows would not have a material impact on the Group’s consolidated financial statements.

13.2 Impairment of other non-financial assets

In 2012, net impairment losses on other non-financial assets amounted to €15.4 million (€46.3 million in 2011).

14.

Investment property At 31 December 2012, the estimated fair value of investment property was €26.7 million and the carrying amount was €10.5 million (€48 million at 31 December 2011). The decrease in the carrying amount resulted mainly from the disposal of a building on Rue Balzac in Paris. Investment property generated rental income of €1.7 million in 2012, along with €0.7 million of direct operating expenses.

VINCI 2012 Annual Report

229

Consolidated financial statements

15.

Investments in companies accounted for under the equity method

15.1

Movements during the period 31/12/2012

31/12/2011

748.6 

713.5 

of which Contracting

617.6 

589.9 

of which Concessions

119.7 

119.0 

Increase of share capital of companies accounted for under the equity method

25.8 

25.9 

Group share of profit or loss for the period

82.1 

50.5 

of which Contracting

79.5 

68.9 

of which Concessions

3.5 

(17.2)

Dividends paid

(57.2)

(57.7)

Changes in consolidation scope and translation differences

13.4 

10.0

(129.1)

(189.4)

(in € millions) Value of shares at start of the period

Net change in fair value of financial instruments (after tax) Reclassifications (*)

126.7 

195.9 

Value of shares at end of period

810.3 

748.6 

of which Contracting

673.1 

617.6 

of which Concessions

118.1 

119.7 

(*) Reclassifications corresponding to the attributable portion of equity-accounted shareholdings in companies with negative net assets, taken mainly to other non-current provisions (see Note E.20.2 “Other non-current provisions”).

The net changes in the fair value of financial instruments relate mainly to interest rate hedging transactions on concession and public-private partnership projects.

15.2 Financial information on companies accounted for under the equity method

The book value of the portion attributable to the Group of VINCI’s shareholdings in companies accounted for under the equity method breaks down as follows by business and business line: (in € millions) Concessions

31/12/2012

31/12/2011

118.1 

119.7 

of which VINCI Autoroutes

15.3 

13.2 

of which VINCI Concessions

102.8 

106.4 

Contracting

673.1 

617.6 

of which VINCI Energies

8.7 

4.6 

of which Eurovia

107.5 

132.3 

of which VINCI Construction

556.9 

480.7 

VINCI Immobilier

19.0 

11.4 

810.3 

748.6 

Investments in companies accounted for under the equity method

The main financial data on the companies accounted for under the equity method is as follows (Group share): 31/12/2012

31/12/2011

Concessions

Contracting and VINCI Immobilier

Total

Revenue

543.5 

1,708.2 

Operating income

114.4 

127.3 

3.5 

(in € millions)

Concessions

Contracting and VINCI Immobilier

Total

2,251.7 

502.0 

1,670.6 

2,172.6 

241.7 

75.6 

134.7 

210.3 

78.6 

82.1 

(17.2)

67.6 

50.5 

Income statement

Net income Balance sheet Non-current assets

2,818.0 

1,805.3 

4,623.3 

2,118.6 

1,485.6 

3,604.2 

Current assets

652.4 

1,090.5

1,742.9 

544.4 

1,051.4

1,595.8 

Equity

310.8 

(629.6)

(318.8)

197.5 

(609.5)

(412.0)

(2,976.8)

(1,192.1)

(4,168.9)

(2,141.5)

(918.3)

(3,059.8)

Current liabilities

(804.5)

(1,074.0)

(1,878.5)

(719.1)

(1,009.0)

(1,728.1)

Net financial debt

(2,705.2)

(174.7) (*)

(2,879.9)

(1,994.1)

(516.6)

(2,510.8)

Non-current liabilities

(*) Additional information inserted on 26 April 2013: Contrary to what is shown under Contracting and VINCI Immobilier above, net financial debt of companies accounted for under the equity method was €651.1 million (not €174.7 million) in 2012. Total net financial debt of companies accounted for under the equity method was therefore €3,356.3 million at 31 December 2012 instead of €2,879.9 million.

Non-current assets include in particular concession fixed assets for concession operating companies, and financial receivables for publicprivate partnership projects.

230

Consolidated financial statements

The main features of concession and PPP contracts are given in Note F.27 “Concession and PPP contracts of companies accounted for under the equity method”. The list of companies accounted for under the equity method is given in Note J “List of the main consolidated companies at 31 December 2012”.

15.3 Commitments made in respect of companies accounted for under the equity method Investment commitments given by the companies 31/12/2012 (in € millions) Investment commitments (Group share)

31/12/2011

Concessions

Contracting

Total

Concessions

Contracting

Total

2,148.3 

17.5 

2,165.8 

2,439.7 

84.3 

2,524.0 

The decrease in investment commitments made by companies accounted for under the equity method (on the basis of the Group’s share) relates mainly to LISEA (high-speed rail line between Tours and Bordeaux) for €294.2 million.

Commitments made by the Group to provide funding (in € millions) Commitments made by the Group to provide funding (capital and/or subordinated debt)

31/12/2012

31/12/2011

389.3 

527.8 

These commitments relate mainly to project companies in the Concessions business, including LISEA for €112.8 million. The change in 2012 was due to LISEA providing €135.3 million of collateral security in place of the initial commitment to provide funding. Collateral security Collateral security has been given by VINCI or VINCI Concessions with regard to project companies in the Concessions business in the form of pledges of shares. The consolidated carrying amount of the shares pledged was €47.7 million at 31 December 2012 and related mainly to the SMTPC and Olympia Odos project companies, for €28.9 million and €9.0 million respectively.

15.4

Related party transactions

The financial statements include certain commercial transactions between the Group and companies accounted for under the equity method. The main transactions are as follows: (in € millions) Revenue

31/12/2012

31/12/2011

1,112.5

917.9 

411.3 

266.8 

Purchases

33.2 

88.4 

Trade payables

58.6 

53.0 

Trade receivables

16. Other non-current financial assets 31/12/2012

31/12/2011

Available-for-sale financial assets

322.1 

306.1 

Loans and receivables at amortised cost

637.2 

525.1 

of which financial assets under PPPs

183.8 

182.2 

Fair value of derivative financial instruments (non-current assets) (*)

756.1 

436.4 

1,715.4 

1,267.6 

(in € millions)

Other non-current financial assets (*) See Note E.23 “Financial risk management”.

Available-for-sale financial assets comprise investments in listed companies for €198.9 million (including shares in ADP for €191.0 million representing a 3.3% shareholding) and investments of €123.2 million in unlisted companies that do not meet VINCI’s minimum financial criteria for consolidation. Loans and receivables at amortised cost comprise receivables relating to shareholdings, including shareholders’ advances to Concessions business or PPP project companies for €183 million (€138 million at 31 December 2011) and financial receivables relating to concession and PPP contracts managed by Group subsidiaries for €183.8 million. Net financial debt includes the fair value of non-current derivative financial instruments (assets) (see Note E.22 “Net financial debt”). The part at less than one year of other non-current financial assets is included under other current financial assets for €33.7 million.

VINCI 2012 Annual Report

231

Consolidated financial statements

Available-for-sale assets and loans and receivables at amortised cost break down as follows: Available-for-sale financial assets

Loans and receivables at amortised cost

(in € millions)

Investments in listed companies at fair value

Investments in unlisted companies

Financial assets (PPP)

01/01/2011

202.3 

114.6 

117.9 

Acquisitions as part of business combinations Other acquisitions during the period Fair value adjustment recognised in equity

 

1.5 

0.3 

28.4 

(19.9) (0.0)

(1.9)

Disposals during the period

(0.2)

(1.0)

 

 

248.6 

 

48.0 

 

Impairment losses

Collateralised loans and Other loans and receivables receivables

0.2 

Total 683.4 

(0.0)

1.5 

133.4 

210.3  (19.9)

 

 

(0.0)

 

 

(1.8)

(3.8)

(20.7)

(41.5)

(19.2)

(0.4)

Currency translation differences

0.2 

(0.1)

0.7 

(0.0)

0.5 

1.3 

Other movements

(0.0)

(18.0)

34.9 

2.3 

(19.3)

(0.1)

182.7 

123.4 

182.2 

2.1 

340.7 

831.2 

31/12/2011 Acquisitions as part of business combinations

 

2.5 

Other acquisitions during the period

 

26.0

 

 

47.0 

   

184.2 

Fair value adjustment recognised in equity

17.6  (0.0)

(6.3)

Disposals during the period

(0.4)

(0.7)

Currency translation differences

0.2 

Other movements

(1.2)

(21.6)

(12.1)

(0.0)

37.4 

2.5 

198.9 

123.2 

183.8 

2.3 

451.2 

959.3 

 

   

3.4 

110.2 

Impairment losses

31/12/2012

 

1.0 

0.9 

(33.1)

 

(0.9)

(0.3)

17.6 

(5.0)

(11.3)

(33.8)

(69.0)

0.8 

0.8 

 

Changes in the period in available-for-sale assets arise mainly from the €17.6 million increase in the value of ADP shares. The €47 million increase in PPP financial receivables in 2012 relates mainly to the Edouard Herriot swimming pool in Bordeaux for VINCI Construction France (€16.2 million) and VINCI plc projects in the United Kingdom (€9.2 million). The increase in other loans and receivables includes a €42.0 million increase relating to the funding of various concession or PPP project companies. The main concession contracts reported using the financial asset model and the related commitments are described in Note F.26 “Controlled subsidiaries’ concession and PPP contracts – financial asset model or bifurcated model”. Loans and receivables measured at amortised cost break down by maturity date as follows: (in € millions) Financial assets – PPPs and concessions

31/12/2012 Between 1 and 5 years

After 5 years

183.8 

31.9 

2.3 

2.3 

Other loans and receivables

451.2 

253.6

197.6 

Loans and receivables at amortised cost

637.2 

287.8 

349.5 

31/12/2011 Between 1 and 5 years

After 5 years

Loans and collateralised receivables

(in € millions) Financial assets – PPPs and concessions Loans and collateralised receivables

182.2  2.1 

19.8   

151.9   

162.5  2.1 

Other loans and receivables

340.7 

216.0 

124.7 

Loans and receivables at amortised cost

525.1 

235.8 

289.3 

232

17. 17.1

Consolidated financial statements

Construction contracts (VINCI Energies, Eurovia and VINCI Construction) Financial information on construction contracts

Costs incurred plus profits recognised less losses recognised and intermediate invoicing are determined on a contract-by-contract basis. If for a given contract this amount is positive, it is shown on the line “Construction contracts in progress – assets”. If negative, it is shown on the line “Construction contracts in progress – liabilities”. (in € millions)

31/12/2012

31/12/2011

(768.4)

(763.7)

Balance sheet data Advances and payments on account received Construction contracts in progress – assets

2,129.9 

2,149.1 

Construction contracts in progress – liabilities

(2,927.7)

(2,281.2)

(797.9)

(132.1)

Construction contracts in progress – net Total income and expenses to date recognised on contracts in progress Costs incurred plus profits recognised less losses recognised to date

48,545.5 

45,133.3 

Less invoices issued

(49,343.4)

(45,265.5)

(797.9)

(132.1)

Construction contracts in progress – net

17.2

Commitments made and received in connection with construction contracts

The Group manages an order book. In accepting orders, it makes commitments to carry out work or render services. In connection with these contracts, the Group makes and receives guarantees (personal sureties). The amount of the guarantees given below consists mainly of guarantees on contracts for work being performed, issued by financial institutions or insurers. Moreover, Group companies benefit from guarantees issued by financial institutions at the request of the joint contractor or subcontractor (guarantees received). 31/12/2012

31/12/2011

Guarantees given

Guarantees received

Guarantees given

Guarantees received

Performance guarantees and performance bonds

4,401.7 

640.7 

4,552.2 

640.2 

Retentions

3,007.2 

484.6 

2,919.6 

664.8 

Bid bonds

159.4 

0.6 

150.1 

0.1 

Deferred payments to subcontractors and suppliers

1,514.7 

479.8 

1,484.6 

380.8 

Total

9,082.9 

1,605.8 

9,106.5 

1,685.9 

(in € millions)

Whenever events such as late completion or disputes about the execution of a contract make it likely that a liability covered by a guarantee will materialise, a provision is taken in respect of that liability. In general, under the rules in force, any risk of loss in connection with performance of a commitment given by VINCI or its subsidiaries would result in a provision being recognised in the Group’s financial statements. VINCI therefore considers that the off-balance sheet commitments above are unlikely to have a material impact on Group assets. VINCI also grants after-sales service warranties covering several years in its normal course of business. These warranties, when set up, lead to provisions estimated on a statistical basis having regard to past experience or on an individual basis in the case of any major problems identified. These commitments are therefore not included in the above table. Moreover, in connection with the construction of the future South Europe Atlantic high-speed rail line between Tours and Bordeaux, the Group has in particular provided a joint and several guarantee and an independent first demand guarantee in favour of LISEA under which the Group guarantees contract performance by the design and construction joint venture (GIE COSEA).

18. Equity Capital management policy In 2012, VINCI continued its purchases of own shares under the programme approved by the Shareholders’ General Meeting held on 2 May 2011 and the new programme approved by the Shareholders’ General Meeting held on 12 April 2012, for a period of 18 months and relating to a maximum amount of purchases of €2 billion at a maximum share price of €60. 17,705,000 shares were bought during the period at an average price of €36.53, for a total of €646.7 million (excluding related purchase costs of €0.2 million). Treasury shares (see Note E.18.2 “Treasury shares”) are allocated to financing external growth transactions, covering performance share plans and for employer contributions to international employee share ownership plans. VINCI’s employee savings policy aims to make it easier for Group employees to become shareholders. At 31 December 2012, more than 58% of the Group’s employees were VINCI shareholders through unit funds invested in VINCI shares. Employees form the largest group of shareholders in the Company, together holding 9.94% of its shares. Neither the Group’s consolidated equity nor the parent company’s equity is subject to any external constraints in the form of financial covenants.

VINCI 2012 Annual Report

233

Consolidated financial statements

18.1 Share capital

At 31 December 2012, the parent company’s share capital was represented by 577,347,352 ordinary shares of €2.5 nominal value each.

The changes in the number of shares during the period were as follows: Number of shares at the start of the period Increases in share capital

31/12/2012

31/12/2011

565,276,672 

552,620,447 

12,070,680 

12,656,225 

Number of shares at the end of the period

577,347,352 

565,276,672 

Number of shares issued and fully paid

577,347,352 

565,276,672 

Nominal value of one share (in €) Treasury shares held directly by VINCI of which shares allocated to cover performance share plans and employee share ownership plans

2.5 

2.5 

41,102,058 

25,021,501 

5,026,096 

7,106,098 

The changes in capital during 2011 and 2012 break down as follows: Increases (reductions) of share capital (in €)

Share premiums arising on contributions or mergers (in €)

Number of shares issued or cancelled

25,210,833 

317,288,509 

10,084,333 

6,429,730 

44,549,294 

2,571,892 

565,276,672 

1,413,191,680 

565,276,672 

1,413,191,680 

01/01/2011 Group Savings Scheme Exercise of share subscription options 31/12/2011 Group Savings Scheme Exercise of share subscription options

Number of shares representing the share capital

Share capital (in €)

552,620,447 

1,381,551,118 

562,704,780 

1,406,761,950 

22,643,660 

252,503,166

9,057,464 

574,334,136 

1,435,835,340 

7,533,040 

52,984,072 

3,013,216 

577,347,352 

1,443,368,380 

577,347,352 

1,443,368,380 

31/12/2012

In February 2006, VINCI issued perpetual subordinated bonds for €500 million. Issued at a price of 98.831%, this loan pays a fixed coupon of 6.25%, payable annually until November 2015. This is only due if VINCI pays a dividend to its shareholders or if the Company buys back its own shares. After that date, the interest rate becomes floating and payable quarterly at the Euribor three-month rate plus 3.75%. VINCI may redeem the bonds at par in November 2015 and subsequently at each interest payment date. These bonds have been accounted for as equity in the Group’s consolidated financial statements.

18.2 Treasury shares

Changes in treasury shares were as follows:

Number of shares at the start of the period Purchases of shares Disposal of shares on exercise of share purchase options

31/12/2012

31/12/2011

25,021,501 

11,360,406 

17,705,000 

15,244,984 

(1,000)

(111,233)

Allocation of 2007 performance shares to employees

(1,100)

Allocation of 2008 performance shares to employees

(1,150)

Allocation of 2009 performance shares to employees

(1,470,406)

Allocation of 2010 performance shares to employees Allocation of 2011 performance shares to employees Employer contribution in connection with the Castor International plan Number of shares at the end of the period

(1,607,900) (1,800) (13,743) 41,102,058 

25,021,501 

At 31 December 2012, the total number of treasury shares held was 41,102,058. These were recognised as a deduction from consolidated equity for €1,661.8 million. A total of 36,075,962 shares have been allocated to financing external growth transactions and 5,026,096 shares to covering performance share and employee share ownership plans outside France.

18.3 Distributable reserves

Changes in the distributable reserves of VINCI SA were as follows: (in € millions)

31/12/2012

31/12/2011

Reserves free of corporate income tax liabilities

17,926.6 

18,315.9 

Distributable reserves

17,926.6 

18,315.9 

The statutory reserve of VINCI SA stood at €141.3 million at 31 December 2012.

234

18.4

Consolidated financial statements

Amounts recognised directly in equity 31/12/2012 Attributable to owners of the parent

(in € millions)

31/12/2011

Attributable to non-controlling interests

Total

Attributable to owners of the parent

 

16.9 

36.8 

17.6 

(19.9)

Attributable to non-controlling interests

Total

Available-for-sale financial assets Reserve at beginning of period

16.9 

Changes in fair value in the period

17.6 

(0.0)

  (0.0)

36.8  (19.9)

Impairment losses recognised in profit or loss

 

 

 

 

 

 

Changes in fair value recognised in profit or loss on disposal

 

 

 

 

 

 

Changes in consolidation scope and miscellaneous

 

 

 

Gross reserve before tax effect at balance sheet date

(I)

(0.0)

 

 

34.5 

(0.0)

34.5 

16.9 

(0.0)

16.9 

Reserve at beginning of period

(773.5)

(33.3)

(806.9)

(427.4)

(16.9)

(444.3)

Changes in fair value of companies accounted for under the equity method

(180.3)

(12.6)

(193.0)

(255.2)

(16.8)

(272.0)

Other changes in fair value in the period

(81.3)

(0.7)

(82.0)

(102.6)

0.4 

(102.3)

Fair value items recognised in profit or loss

16.0 

 

16.0 

11.6 

 

1.5 

0.3 

1.7 

0.1 

 

(1,017.7)

(46.4)

(1,064.1)

(773.5)

(33.3)

(806.9)

(627.6)

(46.4)

(674.0)

(445.5)

(31.7)

(477.2)

(983.2)

(46.4)

(1,029.6)

(756.6)

(33.3)

(789.9)

314.4 

15.0 

329.4 

236.8 

9.4 

246.3 

(668.8)

(31.4)

(700.2)

(519.8)

(23.9)

(543.7)

Cash flow hedge

Changes in consolidation scope and miscellaneous Gross reserve before tax effect at balance sheet date

(II)

of which gross reserve relating to companies accounted for under the equity method Total gross reserve before tax effects

(I + II)

Associated tax effect Reserve net of tax

11.6  0.1 

The negative impact on equity relating to cash flow hedges (€1,064.1 million) arises mainly from transactions to hedge interest rate risk for €1,052.7 million, including: ˇˇ €378.7 million relating to controlled companies, mainly VINCI Autoroutes; ˇˇ €674.0 million relating to companies accounted for under the equity method, mainly infrastructure project companies operating on a PPP or concession basis. These transactions are described in Note E.23.1.3 “Cash flow hedges”.

18.5 Dividends

Dividends paid by VINCI SA in respect of 2012 and 2011 break down as follows: 2012 

2011 

Dividend per share (in €) Interim dividend

0.55

0.55

Final dividend

1.22 

1.22 

Net total dividend

1.77 

1.77 

Amount of dividend (in € millions) Interim dividend Final dividend

294.9 657 (*)

297.9 651.8 

Amount paid in cash

657 

651.8 

Net total dividend

951.9 

949.7 

(*) Estimate based on the number of shares giving rights to a dividend at 26 January 2013, i.e. 538,507,032 shares.

VINCI paid the final dividend in respect of 2011 on 24 May 2012 and an interim dividend in respect of 2012 on 15 November 2012. The Shareholders’ Ordinary General Meeting of 16 April 2013 will be asked to approve the full amount of the dividend that will be paid in respect of 2012 (see Note I.31 “Appropriation of 2012 net income”).

18.6 Non-controlling interests

At 31 December 2012, non-controlling interests in Cofiroute amounted to €346.2 million (€344.3 million at 31 December 2011) and represented 16.67% of the share capital; those in CFE amounted to €251.7 million (€233.9 million at 31 December 2011) and represented 53.16% of the share capital.

VINCI 2012 Annual Report

19. 19.1

235

Consolidated financial statements

Share-based payments Share subscription and purchase options

The number and weighted average exercise prices of share subscription options and purchase options outstanding at 31 December 2012 were as follows: 31/12/2012

Options in circulation at start of the period

31/12/2011

Options

Average price (in €)

Options

Average price (in €)

21,813,275 

34.60 

23,010,679 

32.36 

Options granted during the period

2,457,980 

1,592,493 

Options exercised

(3,014,216)

(2,683,125)

Options cancelled

(6,756,939) (*)

Options in circulation at end of the period

(106,772)

14,500,100 

of which exercisable options

35.93 

21,813,275 

6,418,682 

34.60 

12,307,437 

(*) Of which 3,543,554 unexercised share subscription options and 3,213,385 unexercised share purchase options relating to the 2006 plan that expired on 16 May 2012, for which the exercise price was €40.32.

Options exercised in 2012 and remaining to be exercised at 31 December 2012 Share subscription and share purchase option plans

Number of options exercised in 2012

Exercise price (in €)

Number of options remaining to be exercisedat 31/12/2012

VINCI 2002 No. 1

15.59 

633,138 

 

VINCI 2002 No. 2

12.96 

563,329 

 

VINCI 2003

15.04 

144,867 

437,319 

VINCI 2004

20.18

501,173 

1,427,672 

VINCI 2005

24.20 

931,109 

VINCI 2006 No. 1

35.58 

237,850 

  834,100 

VINCI 2006 No. 2

40.32 

1,000

VINCI 2009

38.37 

750 

VINCI 2010

36.70 

 

4,074,560 

VINCI 2011

43.70 

 

1,567,043 

VINCI 2012

39.04 

Total subscription plans

35.93 (*)

  3,719,591 

 

2,439,815 

3,013,216 

14,500,100 

VINCI 2006 No. 2

40.32

1,000

 

Total purchase plans

40.32 (*)

1,000

 

Total

35.93 (*)

3,014,216

14,500,100 

(*) Based on the number of options remaining to be exercised at 31/12/2012.

Information on the features of the share subscription option plans in force in 2012 Plan granted on 12/04/2012

Plan granted on 02/05/2011

Plan granted on 09/07/2010

Price of the underlying share at grant date (in €)

36.37 

44.87 

35.44 

37.43 

Exercise price (in €)

39.04 

43.70 

36.70 

38.37 

Plan

Lifetime of the options from grant date (in years) Number of options granted Options cancelled Number of options after cancellation Original number of beneficiaries

Plan granted on 15/09/2009









2,457,980 

1,592,493 

4,234,595 

3,865,000 

(18,165)

(25,450)

(160,035)

(144,659)

2,439,815 

1,567,043 

4,074,560 

3,719,591 

302 

266 

1,735 

1,582 

On 12 April 2012, the Board of Directors granted 2,457,980 share subscription options to 302 employees with effect from 12 April 2012. Final vesting of the options is conditional on a performance index. This index has to show an annual average ROCE for 2012 and 2013 of 7% or more for all the share subscription options granted to vest definitively. If the index is between 6% and 7%, the number of share subscription options finally granted will be reduced in proportion and no options will be granted if the index is equal to or less than 6%. Options only vest definitively after a period of three years has elapsed and are conditional on beneficiaries being employed by the Group until the end of the vesting period.

236

Consolidated financial statements

Information on the fair value of the share subscription option plans in force during 2012 The fair value of options has been calculated by an external actuary at the respective grant dates of the options on the basis of the following assumptions: Plan

Plan granted on 12/04/2012

Plan granted on 02/05/2011

Plan granted on 09/07/2010

Plan granted on 15/09/2009 32.91%

27.65%

26.93%

34.22%

Expected return on share

6.95%

8.29%

7.24%

8.01%

Risk-free rate of return (**)

1.29%

2.62%

1.59%

2.38%

Anticipated dividend pay-out rate (***)

5.26%

4.05%

4.99%

4.21%

4.02 

7.66 

4.43 

5.65 

Volatility of the VINCI share price

(*)

Fair value of the option (in €)

(*) Volatility estimated applying a multi-criteria approach based on the mean reversion model. (**) Five-year eurozone bond yield. (***) Average return expected by financial analysts over the four years following the grant date adjusted by a theoretical annual growth rate beyond that period.

An expense of €17 million was recognised in 2012 in respect of share option plans for which vesting is in progress (April 2012, May 2011, July 2010 and September 2009 plans), compared with €16 million in 2011 (May 2011, July 2010 and September 2009 plans).

19.2 Performance shares Information on changes in performance share plans currently in force 31/12/2012

31/12/2011

Number of shares granted subject to performance conditions at start of period

3,783,659 

3,235,383 

Shares granted

2,202,580 

2,139,059 

Shares acquired by beneficiaries

(1,609,700)

(1,470,406)

Shares cancelled Number of shares granted subject to performance conditions not vested at end of period

(126,839)

(120,377)

4,249,700 

3,783,659 

Plan granted on 02/05/2011

Plan granted on 09/07/2010

Information on the features of the performance share plans currently in force Plan Number of beneficiaries

Plan granted on 12/04/2012 1,881 

1,782 

1,813 

Vesting date of the shares granted

12/04/2014

02/05/2013

09/07/2012

Date of end of period of unavailability of shares granted

12/04/2016

02/05/2015

09/07/2014

2,202,580 

2,139,059 

1,726,138 

(14,190)

(75,949)

(118,238)

(1,800)

(1,607,900)

Number of shares granted subject to performance conditions Shares cancelled Shares acquired by beneficiaries Number of shares granted subject to performance conditions at end of year

  2,188,390 

2,061,310 

 

On 12 April 2012, VINCI’s Board of Directors granted 2,202,580 performance shares to 1,881 employees with effect from 12 April 2012. Final vesting of the shares is conditional on a performance index. This index has to show an annual average ROCE for 2012 and 2013 of 7% or more for all the performance shares granted to vest definitively (increased to 9% for members of the Executive Committee on 12 April 2012). If the index is between 6% and 7% (8% and 9% for Executive Committee members), the number of performance shares finally granted will be reduced in proportion and no shares will be granted if the index is equal to or less than 6% (8% for Executive Committee members). Performance shares only vest definitively after a period of two years has elapsed and are conditional on beneficiaries being employed by the Group until the end of the vesting period.

Fair value of the performance share plans

The fair value of the performance shares has been calculated by an external actuary at the respective grant dates of the shares on the basis of the following characteristics and assumptions: 2012 plan

2011 plan

2010 plan

Price of VINCI share on date plan was announced (in €)

36.37 

44.87 

35.44 

Fair value of performance share at grant date (in €)

28.00 

36.90 

28.30 

Fair value compared with share price at grant date (in %)

77.00%

82.25%

79.85%

Original maturity (in years) – vesting period

2 years

2 years

2 years

0.36%

1.81%

0.97%

Risk-free interest rate (*) (*) Two-year government bond yield in the eurozone.

An expense of €69.3 million was recognised in 2012 in respect of performance share plans for which vesting is in progress (April 2012, May 2011 and July 2010 plans), compared with €62.7 million in 2011 (May 2011, July 2010 and September 2009 plans).

VINCI 2012 Annual Report

19.3

237

Consolidated financial statements

Group savings plans

VINCI’s Board of Directors defines the conditions for subscribing to the Group savings plans in accordance with the authorisations granted to it by the Shareholders’ General Meeting. In France, VINCI issues new shares reserved for employees three times a year at a subscription price that includes a discount against the average stock market price over 20 trading days. This discount was 10% up to the plan for the third four-month period of 2012, and was reduced to 5% in the plan for the first four-month period of 2013. Subscribers benefit from an employer contribution with an annual maximum of €3,500 per person. This maximum figure has been reduced to €2,500 from the plan for the first four-month period of 2013. The benefits granted in this way to Group employees are recognised in profit or loss and are valued in accordance with IFRS 2 on the basis of the following assumptions: ˇˇ length of subscription period: four months; ˇˇ length of period during which funds are frozen: five years. The estimated number of shares subscribed to at the end of the subscription period is calculated based on a linear regression method applied to historical observations of the plans between 2002 and 2012, taking account of the cost of restrictions on the availability of units in the savings fund. The opportunity cost of the frozen shares subscribed to is estimated from the point of view of a third party holding a diversified portfolio and prepared to acquire the frozen shares in return for a discount, which should correspond to the return demanded by a purchaser on own funds allocated to hedge against market risk over the period in which the shares are frozen (five years). The market risk is assessed on an annual basis applying a value-at-risk approach. In 2012, in accordance with authorisations given to the Board of Directors by the Shareholders’ General Meeting and pursuant to a decision taken by the Chairman and Chief Executive Officer on 5 March 2012, VINCI initiated savings plans for the employees of certain foreign subsidiaries. Known as Castor International, the plans cover 14 countries: Belgium, Canada, the Czech Republic, Germany, Morocco, Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Switzerland, the UK and the USA. These plans aim to reconcile variations in tax regimes and regulations between countries so that their value for employees is consistent. Their main characteristics are as follows: ˇˇ purchases of VINCI shares at no discount (through reserved capital increases or purchases in the market); ˇˇ subscription period: four weeks ended 13 April 2012 (nine successive periods between March and November 2012 in the UK); ˇˇ employer contribution consisting of bonus shares, with delivery deferred for three years where possible, or with immediate delivery but a three-year vesting period; ˇˇ no lock-up period beyond the three-year vesting period for bonus shares. The employer contribution paid in shares represents the benefit granted by the Group to foreign employees who have subscribed to the plans. This benefit is recognised as an expense over the vesting period, in this case three years. 2012  Group savings plans – France

First four-month period of 2013 (1 January – 30 April 2013)

Third four-month period 2012 (1 September – 14 December 2012)

Second four-month period 2012 (1 May – 31 August 2012)

6.61%

7.16%

7.30%

29.71 

32.40 

Anticipated return from VINCI shares Dividend per share Dividend payable (interim)

(0.55)

Dividend payable (final)

1.22 

Subscription price (in €)

32.45 

Share price at date of Board of Directors’ Meeting

34.59 

34.47 

36.83

34.42%

35.18%

34.14%

Estimated number of shares subscribed

2,233,759 

849,537 

795,160 

Estimated number of shares issued (subscriptions plus employer contribution)

2,740,314 

1,100,150

1,017,804

First four-month period 2012 (1 January – 30 April 2012)

Third four-month period 2011 (1 September – 31 December 2011)

Second four-month period 2011 (1 May – 31 August 2011)

7.80%

8.41%

8.36%

38.23 

38.91 

Historical volatility of the VINCI share price

2011  Group savings plans – France Anticipated return from VINCI shares Dividend per share Dividend payable (interim)

(0.55)

Dividend payable (final) Subscription price (in €) Share price at date of Board of Directors’ Meeting

1.15  29.42  34.87 

43.52 

43.11 

34.57%

31.73%

31.87%

Estimated number of shares subscribed

2,910,617 

654,454 

630,949 

Estimated number of shares issued (subscriptions plus employer contribution)

3,725,589 

839,664 

801,305 

Historical volatility of the VINCI share price

Castor International (excluding the UK)

2012 

Subscription price (in €)

38.73 

Closing share price on the last day of the subscription period (in €)

34.835 

Anticipated dividend pay-out rate

5.53%

Fair value of bonus shares on the last day of the subscription period (in €)

29.64 

238

Consolidated financial statements

For the Group as a whole, the aggregate expense recognised at 31 December 2012 in respect of employee savings plans amounted to €11.6 million (€19.1 million at 31 December 2011).

20.

Non-current provisions Note

31/12/2012

31/12/2011

Provisions for retirement benefit obligations

20.1

821.7 

750.8 

Other non-current provisions

20.2

974.8 

784.6 

1,796.5 

1,535.4 

(in € millions)

Total non-current provisions at more than one year

20.1

Provisions for retirement benefit obligations At 31 December 2012, provisions for retirement benefit obligations amounted to €877.7 million (including €821.7 million at more than one year) compared with €805.8 million at 31 December 2011 (including €750.8 million at more than one year). They comprise provisions for lump sums on retirement and provisions for obligations for supplementary retirement benefits. The part at less than one year of these provisions (€56 million at 31 December 2012 and €55 million at 31 December 2011) is reported under other current payables. VINCI’s retirement benefit obligations under defined benefit plans fall into two categories: The obligations borne by VINCI or its subsidiaries, covered by provisions recognised in the consolidated balance sheet: – For French subsidiaries, these are lump sums paid on retirement, supplementary defined benefit retirement plans of which some of the Group’s employees and officers are members or other closed defined benefit retirement plans, the beneficiaries of which have retired, and an obligation in respect of VINCI’s Vice-Chairman and Senior Director. Some plans are pre-financed through contracts with insurance companies. This relates mainly to obligations covered by two contracts with Cardif/BNP Paribas of which certain Group executives are beneficiaries. – For German subsidiaries, there are several internal plans within the Group, including a so-called “direct promises” plan. Other defined benefit plans, the Fürsorge plan for former employees of G+H Montage and the Eurovia GmbH subsidiaries’ plan, were closed in 2001 and 1999 respectively. In addition, there are commitments to jubilee bonuses and “ATZ” early retirement plans. – For Austrian and Dutch subsidiaries, commitments relate mainly to lump sums paid on retirement and/or jubilee bonuses. ˇˇ Obligations borne through external pension funds. For the most part, these relate to VINCI’s UK subsidiaries (VINCI plc, Nuvia UK, Freyssinet UK, Ringway, VINCI Energies UK, VINCI Park UK, Faceo UK), the CFE Group in Belgium and Etavis in Switzerland. ˇˇ

The retirement benefit obligations covered by provisions recognised in the balance sheet relate mainly to subsidiaries located in the eurozone (France, Germany and Belgium), the UK and Switzerland. They are calculated on the basis of the following assumptions: Eurozone Plan

United Kingdom

31/12/2012

31/12/2011

Discount rate

3.5%

5.0%

Inflation rate

2.0%

2.2%

0.0% to 4.0%

Rate of salary increases Rate of pension increases Probable average remaining working life of employees per plan

31/12/2012

Switzerland 31/12/2011

31/12/2012

31/12/2011

5.1%

1.8%

2.6%

1.8% to 2.6% (*)

2.5% to 3.4%

1.5%

1.5%

0.0% to 4.0%

2.6% to 4.0%

2.7% to 4.5%

2.0%

2.0%

2.0%

2.0% - 2.2%

2.5% - 3.6%

3.4% - 3.8%

0.0%

0.0%

1 to 22 years

1 to 20 years

5 to 16 years

7 to 13 years

8 to 11 years

9 to 11 years

4.4%

(*) Inflation rates: CPI 1.8%; RPI 2.6%.

Discount rates have been determined on the basis of the yield on private-sector bonds with a rating of AA or above and whose maturities correspond to the plans’ expected cash flows. The discount rate finally adopted is the rate equivalent to the application of the various rates depending on maturities. The other local actuarial assumptions (economic and demographic assumptions) are set on the basis of the conditions in each of the countries in question. The preferred method used to determine the expected return on plan assets is the building block method, which breaks the expected return down into the main asset classes: money market investments, investments in bonds and investments in equities. The target allocation of funds is then applied to calculate a weighted average return on assets. In the specific case of funds invested in an insurance company’s “general account” funds, the expected yield has been determined by also taking account of the specific features of each contract, in particular regarding past and forecast net yields. Plan assets are valued at their fair value at 31 December 2012. The book value at 31 December 2012 is used for assets invested with insurance companies.

VINCI 2012 Annual Report

239

Consolidated financial statements

Plan assets break down as follows by asset category: 31/12/2012 United Kingdom

Switzerland

France

Other countries

Weighted average 24%

Breakdown of plan assets Equities

23%

32%

27%

3%

Property

2%

18%

4%

1%

6%

Bonds

52%

43%

64%

3%

49%

Money securities

13%

2%

2%

0%

8%

Other

11%

6%

4%

93%

13%

Total

100%

100%

100%

100%

100%

Average expected return

5.1%

3.7%

3.3%

4.0%

4.5%

523.5 

201.1 

135.1 

44.8 

904.5 

58%

22%

15%

5%

100%

Other countries

Weighted average 24%

Plan assets (in € millions) Plan assets (in %)

31/12/2011 United Kingdom

Switzerland

France

Equities

22%

30%

28%

3%

Property

2%

19%

4%

0%

6%

52%

43%

66%

77%

53%

Breakdown of plan assets

Bonds Money securities

14%

1%

2%

0%

8%

Other

11%

8%

0%

19%

9%

Total

100%

100%

100%

100%

100%

Average expected return

6.1%

4.2%

3.8%

4.3%

5.2%

464.5 

181.2

111.7 

40.0 

797.5 

58%

23%

14%

5%

100%

Plan assets (in € millions) Plan assets (in %)

For the United Kingdom, which constitutes the largest contribution, theoretical expected returns on plan assets are as follows: Equities

Property

Bonds

Money securities

Other

Total

31/12/2012

6.0%

6.2%

4.2%

4.9%

5.6%

5.1%

31/12/2011

6.9%

6.9%

5.2%

5.6%

7.0%

6.1%

Return on financial assets

On the basis of the actuarial assumptions referred to above, the retirement benefit obligations, provisions recognised in the balance sheet, and the retirement benefit expenses recognised break down as follows:

Reconciliation of obligations and provisions in the balance sheet 31/12/2012

31/12/2011

(in € millions)

France

Foreign

Total

France

Foreign

Total

Present value of retirement benefit obligations

(774.6)

(1,330.2)

(2,104.8)

(625.0)

(1,140.9)

(1,765.9)

Fair value of plan assets

135.1 

769.5 

904.5 

111.5 

686.0 

797.5 

Surplus (or deficit)

(639.5)

(560.7)

(1,200.2)

(513.6)

(454.8)

(968.4)

Provisions recognised in the balance sheet

(471.7)

(405.9)

(877.7)

(434.7)

(371.2)

(805.8)

30.9

39.5 

70.4 

24.9 

24.0 

48.9 

198.8 

194.3 

393.0 

103.8 

107.7 

211.4 

163.8 

195.1 

358.9

65.4 

108.1 

173.5 

35.0 

0.1 

35.1 

38.3 

0.1 

38.5 

(1.0)

(1.0)

 

(0.5)

(0.5)

Assets recognised in the balance sheet Items not recognised in the balance sheet of which actuarial gains and losses of which past service cost of which assets not recognised in the balance sheet

 

240

Consolidated financial statements

Changes in the period 31/12/2012

31/12/2011

Balance at the beginning of the period

1,765.9 

1,708.1 

of which obligations covered by plan assets

1,021.7

959.0 

(in € millions) Present value of retirement benefit obligations

Current service cost

50.7 

50.7 

Cost of discounting for the period

84.7 

78.9 

Benefits paid during the period

(83.4)

(76.3)

Actuarial gains and losses

211.8 

(24.4)

Past service cost Business combinations

2.9 

 

44.7 

3.1 

Settlement of rights and plan curtailments

(0.8)

(4.1)

Effect of exchange rate fluctuations

13.6 

21.9 

13.8 

7.9 

Balance at the end of the period

Changes in consolidation scope and miscellaneous

2,104.8 

1,765.9 

of which obligations covered by plan assets

1,192.0 

1,021.7

Plan assets Balance at the beginning of the period

797.5 

735.9 

Expected return on plan assets

42.0 

37.5 

Actuarial gains and losses

22.3 

(9.5)

Contributions paid to funds

51.5 

36.9 

Benefits paid during the period

(37.7)

(32.7)

Business combinations Settlement of rights and plan curtailments

4.6 

0.2 

 

(0.3)

Effect of exchange rate fluctuations

11.9 

Changes in consolidation scope and miscellaneous

12.4 

10.6

904.5 

797.5 

Balance at the end of the period

18.8 

Amounts not recognised in the balance sheet Balance at the beginning of the period

211.4 

240.9 

New items

189.5 

(14.9)

Effect of changes in assumptions

214.3 

(10.9)

(2.5)

(13.5)

Effect of experience gains and losses on retirement benefit obligations Effect of experience gains and losses on plan assets

(22.3)

9.5 

Amortisation for the period

(9.2)

(8.6)

Exchange rate and other changes

1.3 

(6.2)

Plan curtailments

(0.0)

0.2 

393.0 

211.4 

Balance at the end of the period of which actuarial gains and losses

358.9

173.5 

of which past service cost

35.1 

38.5 

of which assets not recognised

(1.0)

(0.5)

17.1%

9.8%

Actuarial gains and losses as a percentage

The increase in actuarial gains and losses in 2012 arises mainly from the decline in discount rates in the eurozone, Switzerland and the United Kingdom, partially offset by the good performance of hedging assets. Changes in the period under “Business combinations” relate mainly to the obligations of German group GA Gruppe, acquired by VINCI Energies in the second half of 2012.

VINCI 2012 Annual Report

241

Consolidated financial statements

Historical data on the obligation, fair value of financial assets and effect of experience adjustments (in € millions)

31/12/2012

31/12/2011

31/12/2010

31/12/2009

31/12/2008

(2,104.8)

(1,765.9)

(1,708.1)

(1,390.0)

(1,185.6)

904.5 

797.5 

735.9 

590.5 

507.5 

(1,200.2)

(968.4)

(972.2)

(799.5)

(678.1)

(2.5)

(13.5)

(14.5)

10.4

(9.6)

Value of plan assets and liabilities Present value of retirement benefit obligations Fair value of plan assets Surplus (or deficit) Experience adjustments Effect of experience gains and losses on retirement benefit obligations

0.1%

0.8%

0.8%

-0.7%

0.8%

Effect of experience gains and losses on plan assets

Percentage of retirement benefit obligations

(22.3)

9.5 

(6.2)

(22.3)

95.0 

Percentage of plan assets

-2.5%

1.2%

-0.8%

-3.8%

18.7%

VINCI estimates the payments to be made in 2013 in respect of retirement benefit obligations at €125 million, comprising €95 million relating to pensions paid to retired employees and €30 million to contributions payable to fund managing bodies.

Expenses recognised in respect of defined benefit plans (in € millions)

2012 

Rights vested in employees during the period

(50.7)

2011  (50.7)

Discounting of vested rights to present value

(84.7)

(78.9)

Expected return on plan assets

42.0 

37.5 

Amortisation of actuarial gains and losses

(7.4)

(6.8)

Amortisation of past service cost – rights not vested

(1.8)

(1.8)

Past service cost – rights vested

(0.5)

0.4 

Other

(3.8)

0.1 

Total

(106.9)

(100.2)

0.50%

-0.50%

(3.6)

3.2

Sensitivity of the 2013 expense to the discount rate is as follows: (in € millions) Discount rate

Expenses recognised in respect of defined contribution plans In some countries, and more especially in France and Spain, the Group contributes to basic State Pension Plans, for which the expense recognised is the amount of the contributions called by the State bodies. Basic State Pension Plans are considered as being defined contribution plans. Depending on the country, the proportion of these contributions paid that relates to pensions may not be clearly identifiable. The amounts taken as an expense in the period in respect of defined contribution plans (excluding basic State plans) totalled €466.4 million at 31 December 2012 (€440.1 million at 31 December 2011). These amounts include the contributions paid to the external multi-employer fund (CNPO) in respect of obligations in regard to lump sums paid on retirement to building workers in France.

20.2 Other non-current provisions

Changes in other non-current provisions reported in the balance sheet were as follows in 2012 and 2011: Change in the Changes in part at less consolidation than one year Provisions Other reversals scope and of non-current used not used miscellaneous provisions

(in € millions)

Opening

Provisions taken

01/01/2011

442.9 

260.5 

(172.9)

(21.6)

117.6 

Other employee benefits

146.2 

19.0 

(28.5)

(0.6)

(3.8)

Financial risks

252.0

3.8 

(10.3)

(0.2)

183.9 

 

(0.0)

429.3 

Other liabilities

463.6 

178.0 

(122.2)

(11.1)

35.0 

 

1.1 

544.4 

(13.3)

 

(0.4)

(19.2)

Discounting of non-current provisions

(6.3)

 

0.6 

0.2 

Reclassification of the part at less than one year of non-current provisions

(253.9)

 

 

 

31/12/2011

601.6 

200.8 

(160.4)

Other employee benefits

131.9 

18.5 

(23.4)

Financial risks

429.3 

10.3

Other liabiliti