Veolia Environnement: 9M13 results – First read – Below expectations; consensus expectations remain at risk
NEUTRAL, Fair Value EUR14.5 (+19%)
Veolia reported weak Q3 numbers this morning, with EBITDA 1.7% below expectations. Current FY13 EBITDA consensus of EUR1.86bn implies 12% EBITDA growth in Q4 (vs. -8.0% in 9M13), which appears extremely optimistic to us, despite the increasing contribution of the cost-cutting measures. Flat EBITDA in Q4 would bring FY13 EBITDA to EUR1.8bn, which would imply a 3.0% downward revision. We maintain our cautious stand in the short term, awaiting for a more attractive entry point, as we believe the medium-term story remains intact.
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