February 7, 2008

Wendel's consolidated net sales totaled 5.5 billion euros, up +9% on a proforma basis⁽¹⁾, and +28% with reference to the Group's published net sales. 

Each of the Group's companies made a significant contribution to Wendel's sustained organic growth⁽²⁾  of  +7% (average).
 
In 2007, in keeping with its role as a professional shareholder, Wendel stepped up the integration of the companies it had acquired in 2006, and since September, it has pursued its strategy of investment and diversification.
 
■ In order to allow Bureau Veritas to move on to a new stage in its growth and development, Wendel organized its subsidiary's IPO in October. The success of this operation enabled Wendel to sell 1.2 billion euros in shares while remaining Bureau Veritas' largest shareholder.

■ At the same time, Wendel became the leading shareholder of Saint-Gobain through the acquisition of almost 18% of the capital stock for 4.85 billion euros. To finance this operation, Wendel mobilized 1.5 billion euros of its own resources and non recourse financing, with maturities of three to five years, in line with the Group's long-term strategy. Wendel has significant cash resources that enable it to weather any turbulence in the markets. Wendel is convinced of the group's potential, which it intends to accompany over the long term and has responded positively to the request formulated by Saint-Gobain's Board of Directors at its meeting on November 22, 2007, to open discussions about whether Wendel should sit on the Board.
 
■ Finally, Wendel sold all of its minority interest in Neuf Cegetel, representing 2.4% of the capital, for a total of 148 million euros.
                                                                                                                                         
 
For Jean-Bernard Lafonta, Chairman of the Executive Board: "In a more difficult environment, the pursuit of growth targeted by all our subsidiaries and the quality of our assets bolster Wendel's development potential. The Group reaffirms its long-term strategic ambitions and maintains its objective of doubling net asset value by 2012."

Proforma⁽²⁾ consolidated net sales

^{(1) Growth on a constant consolidation basis: consolidated proforma net sales include the net sales of Materis and Deutsch for the year 2006.
 (2) Organic growth is calculated excluding Oranje-Nassau, since the trend in that company's net sales reflects the price of oil and production volume.}

Published consolidated net sales

Net sales of companies accounted for by the equity method

Bureau Veritas

Net sales in 2007 exceeded 2 billion euros (2,067 million euros), representing a significant rise of +12%. Organic growth stood at +10%, boosted in particular by the dynamism of the Marine division (+21%), linked to the strong growth in demand for the certification of new ships and ships in service, especially in China, and of the Industry division (+18%), mainly linked to the oil and electricity sectors, as well as by the recovery of Government Services and International Trade activities (+19%), with recent contracts in Africa and Asia. The Consumer Products division also reported strong organic growth (+12%), in particular in the segment of toys and textile in Germany and the United States.
External growth was +5% and mainly reflected the contribution of the companies acquired in Spain (ECA), Australia, the United States and Germany. Exchange rate fluctuations had a negative impact of 3%.
 
Materis

Net sales totaled 1,817 million euros in 2007, up +12%. Organic growth was +7%, boosted by strong growth in the Admixtures (linked to good performance in sales of concrete) and Aluminates (reflecting remarkable performance in Asia), sustained growth in the Mortars division (in spite of the downturn in the American market), and for the Paints division, growth is in line with the underlying markets in France and southern Europe.
External growth was +6%, the result of the acquisitions made in 2006 and 2007, primarily in Paints (France, Argentina, Switzerland) and Mortars (Spain, China, the United States, Turkey, the United Kingdom, Argentina and Brazil), as well as in Admixtures (India). Exchange rate fluctuations had a negative impact of 1%.
 
Editis

2007 net sales amounted to 760 million euros, with organic growth of +2%. This performance can be attributed to sustained growth in the group's three business segments. Literature was boosted by the performance of large-format bestsellers in 2007 and the ongoing development of pocket books. The Education segment reported good back-to-school results and developments in paraschool products. Distribution benefited from new contracts signed with external publishers.
The acquisitions made in 2006 and 2007 – the Belgian group De Boeck and Paraschool in Education, Gründ in Literature and DNL in Distribution – contributed to the increase in consolidated net sales (+9%) and thus offset the impact of the termination of the university press distribution contract that was transferred to the Lagardère Group as of January 1, 2007 (-10%). 
 
Deutsch

In 2007, net sales totaled 438 million euros, with sustained organic growth (+5%). The depreciation of the US dollar vis-à-vis the euro had a negative impact of 5%.
The new organization based on global divisions (Industry and Aerospace) has been operational since the beginning of the second quarter and started to deliver results as of 2007.
The Aerospace division reported strong organic growth (+12%), reflecting the first results of the cross-marketing strategy, particularly in the United States and in spite of a difficult environment, which was especially marked by delays in certain major civil aircraft programs (Airbus A380 and Boeing 787).
The Industry division reported more limited growth (+2%). Sales in the United States were stable and showed remarkable resistance in an environment affected by a significant decline in the heavy vehicle market, offset by the solid growth in the business in Europe.
At the beginning of 2008, Deutsch announced the sale of its relay activity and the acquisition of 60% of the capital of LADD, which distributes the Industry division's products in the United States. These two operations are perfectly in line with the strategic decision to focus on harsh environment connectors and to control their distribution.
 
Oranje-Nassau

Net sales at Oranje-Nassau – excluding real estate activities – totaled 243 million euros, up 4% from 2006. Oil production increased significantly by +8%, boosted by the startup of operations at the Buzzard oil field in the beginning of 2007. After accounting for the negative impact of the depreciation of the US dollar vis-à-vis the euro, the average price of a barrel was up +1% in 2007.
In 2007, Oranje-Nassau signed an agreement with Devon Energy International Ltd to pay 206 million US dollars to acquire all that company's assets located off the coast of Gabon. The acquisition of these fields, subject to approval of Gabonese government, is expected to result in a 15% increase in Oranje-Nassau's net production, which was approximately 15,500 boe per day at the end of 2007. In addition, within the framework of its strategy to refocus its investments in the oil sector and in private equity, the company completed the sale of all its real estate holdings.
 
Stallergènes

Stallergènes reported strong growth in net sales compared with 2006 (+16%), reflecting the dynamism of the sublingual treatment segment (+21%). The significant increase in the number of new patients, in particular in France and Germany, makes these countries the principal vectors of this growth.
Authorization to market the company's ORALAIR® Graminées allergy treatment tablet is pending.
 
Stahl (accounted for by the equity method)

After a decline in the first half, Stahl's organic growth rose +3% in the second half of 2007, in particular owing to the good performance of the high performance coating division (Permuthane) and leather finish division in Asia. Net sales in 2007 totaled 311 million euros, representing organic growth for the year of +1%.
Stahl's management pursued the implementation of its plan to optimize fixed costs and improve operations, thereby boosting the company's profitability, a trend that is expected to continue in 2008.
 
Legrand (accounted for by the equity method)

At 4,129 million euros, net sales increased by +11% compared with 2006. Organic growth was +9%. It was boosted by the positive impact of acquisitions (+4%), but affected by unfavorable exchange rates (-2%). Organic growth in 2007 was marked by good performance in France (+6%) and Italy (+8%), the remarkable resistance demonstrated by Legrand in the United States (+2%), and strong growth in the rest of Europe (+13%) and the rest of the World (+13%). Net sales in emerging markets rose +18%, representing now close to 25% of the group’s total.

Wendel reported an 8% increase in proforma(2) consolidated net sales in the first three quarters of 2007 to 4 billion euros.
                                                                                                                                                         
This rise well reflects the performance of the Group's business sectors, their sustained average organic(1) growth (+7%), and their dynamic acquisition policy.
 
During the period, in keeping with its profile as a professional shareholder, Wendel focused on the integration of the companies it acquired in 2006 and, since September, has pursued its investment and diversification policy.                                                                                                                         
 
- In order to enable Bureau Veritas to move on to a new stage in its development, Wendel realised the IPO for its subsidiary on October 24. Wendel sold 1.2 billion euros of shares (after the over-allotment option exercise) at 37.75 euros per share, at the high end of the estimated price range. Wendel remains the largest shareholder of Bureau Veritas with 63.6% of the capital. Wendel reported an internal rate of return of 46% per year on its 2004 investment and has multiplied the value of its investment by 6 since 1995.
 
- Since September, Wendel has progressively acquired 58.1 million Saint-Gobain shares for approximately 4.25 billion euros. Wendel now owns 15.5% of Saint-Gobain's capital, and is the company’s largest shareholder. Within the framework of this transaction, Wendel has mobilized 1.4 billion euros of its own resources as well as non recourse financing.
 
- Wendel sold most of its minority shareholding interest in Neuf Cegetel, representing 2.3% of the capital, for a total of 138 million euros. After this transaction, Wendel still owns 280,000 shares, which account for 0.1% of the capital.
 
For Jean-Bernard Lafonta, Chairman of the Executive Board, "Wendel was particularly active in the last few months. Acquisition, IPO and divestments organized since September provide a perfect illustration of Wendel's strategy – to implement the ambitious growth strategies of the Group's business sectors, and exercise Wendel's role as a long-term industrial shareholder that works in partnership with the companies' management teams."
 
Net asset value
 
Wendel’s net asset value totaled 6.8 billion euros as of November 2007, i.e. 135 euros per share compared with 107 euros per share in November 2006. Accounting for the 2 euro dividend paid in June, the annual increase was 28%.

Proforma⁽²⁾ consolidated net sales

^{(1). Organic growth is calculated excluding Oranje-Nassau, at which changes in net sales are linked to the price of oil and to production levels.
(2) Increase on a constant consolidation basis: proforma consolidated net sales include the net sales of Materis and Deutsch for the first three quarters of 2006}

Published consolidated net sales

Net sales of companies accounted for by the equity method

Bureau Veritas

Net sales in the first nine months of 2007 totaled 1,467 M€, up a significant 9%. Organic growth stood at +9%, particularly boosted by the dynamism of the Marine division (+21%), linked to strong demand for the certification of new ships and ships in service; by the performance of the Industry division (+19%), mainly linked to the oil and electricity sectors; and by the recovery of the Government Services and International Trade division (+20%) with recent contracts in Africa and Asia. The Consumer Products division also reported strong organic growth (+10%), especially in the segment of electrical and electronic products in France and the United States.
At +2%, external growth mainly represented the contribution of the companies acquired in Australia, the United States, Austria and Germany. The trend in foreign exchange rates had a negative impact of 2%.
With the acquisition of 100% of the capital of ECA GLOBAL in October, the Bureau Veritas group will more than triple its size in Spain, where it is now the Spanish leader in in-service inspection and verification, services for industry, certification and technical control for construction.
 
Materis

At the end of September 2007, Materis reported strong growth of 14% in net sales, which totaled 1,384 million euros. Organic growth rose by 8%:  Aluminates benefited from dynamic activity in building chemicals in Europe and good performance in the flow and refractory segments in Asia and Europe. The Mortars business reported high sales levels in France, Spain, Argentina and Asia, offsetting the downturn in the United States. The Admixtures division was sustained by satisfactory sales in all countries, with particular success around the Mediterranean zone and in Africa. Organic growth in Paints was more moderate, in line with market growth in France and southern Europe.
External growth was +7%, mainly the result of acquisitions made in 2006 in Argentina and Switzerland in the Paints branch, and in Spain, China and the United States in the Mortars branch. Foreign exchange had a negative impact   of -1%.
 
Editis

Net sales totaled 541million euros at the end of September 2007, with organic growth of +2%, as it continued to outperform the publishing market. In the third quarter, organic growth was stronger than in the first half, and stood at +4%, boosted on the one hand by the dynamism of external publishers distributed through Interforum, and on the other hand by the performance of Group publishers in school textbooks.
In the first nine months of the year, the acquisition of DNL and the Belgian group De Boeck, which reported satisfactory performance levels, made a significant contribution to consolidated net sales (+9%), and offset the termination of the Universitaire distribution contract transferred to Lagardère Group of  as of January 1, 2007 (-11%).
In the third quarter, Editis pursued its development strategy with the acquisition of Editions Gründ, which serves to bolster its publishing offer, and Paraschool, which strengthens its digital content position.
 
Deutsch

Net sales totaled 329 million euros in the first nine months of 2007, with continued sustained organic growth (+4%) since the beginning of the year, in spite of a high base for comparison in the third quarter of 2006. The new organization based on global divisions (Industry and Aerospace) has been operational since the beginning of the second quarter and has already begun to produce the desired effects.
The Aerospace division reported strong organic growth (+10%) as a result of the new cross-marketing strategy, especially in the United States.
The Industry division was stable, with a significant downturn in business volume for heavy vehicles in the United States, in line with expectations, which was nevertheless offset by strong growth in sales in Europe.
The depreciation of the US dollar vis-à-vis the euro had a negative impact of 4%.
  
Oranje-Nassau

In the first nine months of the year, oil production increased 5%, boosted by the startup of operations at the Buzzard oil deposit at the beginning of 2007. Net sales at Oranje-Nassau – excluding real estate activities – totaled 175 million euros, down 2% from the same period in 2006 after the negative impact of the depreciation of the US dollar vis-à-vis the euro.
n October 2007, Oranje-Nassau announced the sale of all its real estate holdings, reflecting the company's strategy to focus on the expansion of its investments in the oil and gas sector and on private equity activities.
 
Stallergènes

Stallergènes continued to report very strong growth in net sales, up +17% from 2006 to 104 million euros in the first nine months of the year. Organic growth was also +17%, fueled by the dynamic performance of the company's sublingual allergy treatments, whose reputation benefits from the future launch of allergy treatment tablets. Construction of the new allergy treatment production facility has been completed, and the German agency P.E.I. is studying the company's request for authorization to market ORALAIR® Graminées allergy treatment tablets.
 
Stahl (accounted for by the equity method)

In the third quarter of 2007, Stahl reported organic growth of +4%, in particular reflecting the good performance of the high performance coatings (Permuthane) division. After a first half down -1%, net sales in the first nine months of the year totaled 232 million euros, up slightly from the same period in 2006, excluding the foreign exchange impact,
In the third quarter, Stahl's management pursued its plan to reduce fixed costs.
 
Legrand (accounted for by the equity method)
 
Net sales totaled 3,095 million euros, up 11% in the first nine months of the year, with organic growth of +9% on a constant consolidation and foreign exchange basis. External growth made a positive contribution (+4%), while the foreign exchange impact was unfavorable (2%).
Organic growth was high in France (+7%) as a result of excellent performance levels in new product lines, illustrating the success of the strategy to upgrade lines. After an exceptionally strong first half, growth in Italy also remained high (+8%) in the first nine months. In the United States and Canada, Legrand demonstrated excellent resistance notably thanks to its high value added products, resulting in organic growth of 1%. Emerging countries reported the highest rate of growth in the group, with organic growth of +18% in the first three quarters, representing close to 24% of the group’s net sales.
Since the beginning of the year, Legrand has pursued its targeted, self-financed external growth strategy with four acquisitions: HPM in Australia, UStec in the United States, Kontaktor in Russia, and more recently, Macse in Mexico. On an annual base, these four companies should contribute net sales of more than 170 million euros in 2007.

Wendel's consolidated net sales rose +7% on a proforma basis⁽¹⁾ in the first half of 2007 to 2,627 million euros.
Average organic growth continued to be sustained at Group subsidiaries⁽²⁾ (+7%).
 
This trend reflects the performance of the Group's business sectors, their dynamic acquisition policy, and the good integration of the investments Wendel made in 2006.

Consolidated net sales proforma⁽¹⁾:

Consolidated net sales as published:

Net sales of companies accounted for by the equity method:

Bureau Veritas
Net sales in the first half of 2007 totaled 969 million euros. Organic growth was 9% and external growth 2%. Organic growth was fueled by dynamic activity in the Marine division linked to the high demand for new ships, by the good performance of the oil and electricity sectors in the Industry Services division, and by the recovery of the Government Services business, in particular with the signing of two new contracts in Africa and Asia. External growth was 2%, primarily owing to acquisitions in Australia in the Industry Services and Health, Safety and Environment divisions. This growth will be bolstered in the second half by the June 2007 acquisition of the Australian firm CCI Holdings. The foreign exchange impact of -3% was mainly attributable to the trend in the U.S. dollar exchange rate. Within the framework of its IPO, Bureau Veritas announced that it had filed its basic document with French stock market authorities (AMF) on July 10, and Wendel confirmed its intention to sell a part of its holding, subject to market conditions, and to maintain control of the company.
 
Materis
In the first half, Materis reported strong growth (+13%) in net sales, which totaled 918 million euros. Organic growth was +8%. Aluminates benefited from dynamic activity in building chemistry and good performance in the flow and refractory segments. The Mortars business reported high sales levels, particularly in Argentina and Asia. Finally, the Admixtures division benefited from a strong concrete segment. External growth was +7%, mainly the result of acquisitions made in 2006 in Argentina and Switzerland in the Paints branch, and in Spain, China and the United States in the Mortars branch.
 
Editis
At the end of the first half of 2007, net sales stood at 321 million euros, representing organic growth of +1%, in spite of a slump in the publishing industry. In the second quarter, organic growth was +2%, boosted by the education, young people and literary bestsellers segments. In the first half, the acquisitions of DNL and the Belgian group De Boeck, which reported satisfactory performance levels, made a significant contribution to consolidated net sales (+10%), and offset the termination of the Universitaire distribution contract as of January 1, 2007 (-10%). Editis pursues its development strategy, and finalized the acquisition of Editions Gründ at the beginning of July, thereby bolstering its publishing offer.
 
Deutsch
In the first half of 2007, net sales totaled 224 million euros, with sustained organic growth (+5%) in line with expectations and linked to the good performance of the Heavy Vehicles sector in Europe and of Aerospace activities in the United States. Growth in the second quarter of 2007 was in line with the first quarter of 2007, while the 2006 base of comparison was affected by the postponement of shipments from the first to the second quarter of 2006. A new organization based on global divisions (Industry and Aerospace) has been operational since the beginning of the second quarter.
 
Oranje-Nassau
Net sales totaled 121 million euros, down 11% from the first half of 2006. This change reflected the decrease in the average price of oil in the first half, expressed in euros. The startup of operations at the Buzzard oil deposit at the beginning of 2007 led to a 2% increase in production, a trend that is expected to continue throughout 2007.
 
Stallergènes
Stallergènes continued to report strong growth in net sales, up +17% from the first half of 2006 to 75 million euros. Organic growth was also +17%, fueled by the dynamic performance of the company's sublingual allergy treatments, whose reputation benefits from the future launch of allergy treatment tablets.
 
Stahl(accounted for by the equity method)
At the end of the first half, net sales totaled 154 million euros. With a negative foreign exchange impact of -3% and organic growth of -1%, total growth in the first half was -4%. Excluding the foreign exchange impact, Stahl reported stable net sales in the second quarter, compared with the second quarter of 2006, after a 2% decline in the first quarter of 2007. In the first six months, the performance of the European market, up 3%, offset the continued lackluster environment in the Asia-Pacific region, where a new management team took over in the second quarter.
 
Legrand (accounted for by the equity method)
In the first half, net sales totaled 2,096 million euros, reflecting strong growth of +11%, with +9% attributable to organic growth, +4% to external growth and -2% to the foreign exchange impact.
Growth in France remained firm at +7%, reflecting continued support from the success of new wiring-device ranges. In Italy, the generally favorable market environment led to organic growth of +9%.
The rest of the world and the rest of Europe reported respective increases in net sales of +12% and +15%, due in part to growth in emerging countries, which now account for 22% of the group's total net sales, reflecting organic growth of almost +18%.
In addition, Legrand pursued its external growth strategy with the acquisition of HPM (Australia and New Zealand) and UStec (USA) at the beginning of the year and, more recently, subject to the approval of the competent authorities, the acquisition of Kontaktor, the Russian leader in high-current circuit breakers. In 2006, these three companies reported total net sales of almost 150 million euros.

Consolidated net sales at WENDEL Investissement rose 8% on a proforma basis⁽¹⁾ in the first quarter of 2007 to 1,254 million euros.
 
The average organic growth of the business sectors⁽²⁾ remained strong (+9%), reflecting very good performance levels at Bureau Veritas, Materis, Deutsch and Stallergènes.
Legrand, whose net sales are accounted for by the equity method, also produced very good results in the first quarter of 2007 with organic growth of +9%.
This increase in the results of the Wendel Group was accompanied by a dynamic strategic focus on external growth in subsidiaries, as illustrated by the acquisition, at the beginning of 2007, of UStec and HPM by Legrand, of De Boeck by Editis, and of several companies by Bureau Veritas, with its current bid for CCI Holdings in Australia.

Consolidated net sales proforma (1):

Consolidated net sales as published:

Net sales of companies accounted for by the equity method:

Bureau Veritas
In the first quarter of 2007, net sales totaled 469 M€ with strong organic growth of 11%. The Marine division reported sustained business volume owing to a significant increase in the number of ships and the good performance of construction and new facilities. The Industry division benefited from the dynamism of the oil and electricity sectors, as well as from the acquisitions made in 2006 in Australia. Government Services and International Trade also reported strong growth, mainly in Angola and the Ivory Coast. After accounting for changes in consolidation (+2%) and the impact of fluctuations in exchange rates (-4%), total growth was 9%.
 
Legrand (accounted for by the equity method)
Net sales totaled 1,033 M€, up 10%, with organic growth of 9%, a negative impact of fluctuations in exchange rates of -2%, and external growth of 3%. Organic growth was strong in France (+7%), owing to the success of new product lines, and in Italy (+10%) within a context of continued improvement in the product mix. The organic growth in net sales was particularly high in emerging countries (+18%).
 
Materis
Net sales in the first quarter of 2007 stood at 428 M€, up 16%. Organic growth was 11%, driven by the dynamism of the Admixtures and Mortars activities, by the good performance of the specialty building materials in Aluminates, and by the successful launch of new products in Paints. External growth was 8%, in large part the result of the acquisitions made in 2006, in Argentina and Switzerland for the Paints branch and in Spain, China and the United States for the Mortars branch.
 
Editis
In the first quarter of 2007, net sales totaled 143M€. Organic growth was 0.4%, outperforming the slightly depressed publishing market. The impact linked to the acquisition of DNL in July 2006 (+8%) partially offset the termination of the distribution contract of university books (in particular Dunod Dalloz) as of January 1, 2007 (-12%).
 
Deutsch
Net sales were 115 M€ in the first quarter, representing organic growth of 9% bolstered by the excellent performance of the Transport and Heavy Vehicles sector, and a negative impact of fluctuations in exchange rates of -4%.
 
Oranje-Nassau
Net sales in the first quarter of 2007 were down 21% to 57M€. This change mainly reflected the decrease in the price of oil expressed in euros (-15%). The progressive startup of operations at the Buzzard oil field in the first quarter of 2007 helped limit the decrease in production in the first quarter and should lead to new growth in production for the year 2007.
 
Stallergènes
Net sales stood at 43M€ in the first quarter, with organic growth of 20%. This great performance is a reflection of major progress in the development of new treatments that have resulted in an increase in sales of sublingual anti-allergy products.
 
Stahl (accounted for by the equity method)
Net sales in the first quarter were 75M€, impacted by fluctuations in exchange rates (-3%). The decrease in organic growth (-2%) was linked to a sluggish market environment affected by the rise in customs duties on skins imported in China. The change in CEO at the end of January simplified corporate organization and prompted efforts to improve operational efficiency.

⁽¹⁾ Consolidated net sales proforma include the net sales of Materis and Deutsch in the first quarter of 2006.
⁽²⁾ Organic growth is calculated excluding Oranje-Nassau since changes in that company's net sales are linked to the price of oil and to production.