The RATP Group
The RATP Group operates or prepares the commissioning of public transport networks in Île-de-France, in the provinces and internationally in 12 different countries. Its Systra and Xélis subsidiaries perform engineering operations worldwide. In 2011 the RATP Group earned €4.983 billion in revenues, and employed 56,000 people across the globe in 2011.
Change in RATP Group's main performing indicators
31 December 2010
31 December 2011
Group's share of recurring net income
2011 financial results
CONSOLIDATED STATEMENTS OF INCOME
as of 31 December 2011
STATEMENT OF COMPREHENSIVE INCOME
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED STATEMENTS OF CASH FLOW
Main developments in 2011
The year 2011 was marked by the following main events:
Completion of the Transdev transaction
The agreement with Veolia Environnement and the Caisse des Dépôts was signed in May 2010, formalizing the exit of RATP from Transdev capital, the related suspensive conditions were raised at the end of that year and the transaction was finally completed on March 3, 2011. RATP received consideration in the form of the French and foreign assets of Veolia Transports and Transdev. RATP in turn contributed these assets to RATP Développement (RATP Dev) by way of a share capital increase. As the French competition authorities had raised their suspensive conditions at the end of 2010, RATP group deemed that it had obtained control of these businesses as of January 1, 2011, ahead of the legal transaction date.
The new businesses are located in England (London and Bournemouth), Italy, France (town and intercity routes in the Centre, East and Haute-Savoie regions) and in Switzerland. However, RATP Dev decided against operating the Genoa network due to the local situation and expectations that the network will continue to be loss-making. RATP Dev exercised its contractual right to exit the capital in order to safeguard its overall investment.
The financial statements were strongly impacted by this asset exchange.
First, RATP recorded a gain on the disposal of its shareholding in Financière Transdev, and RATP Dev also reported a gain on the disposal of its jointly-held assets to Veolia-Transdev, less the integration costs related to its newly-acquired assets.
During 2010 and 2011, RATP Dev reorganized its operations in order to efficiently manage its asset portfolio. This entailed setting up business units for France, Northern Europe and International business, creating and structuring holding companies at country level in Italy and the United Kingdom, strengthening central functions and adapting its governance structure.
RATP Dev also incurred expenditure in order to achieve the technical and operational integration of its new subsidiaries.
The financial statements also include the 12-month results of these businesses, except for the London United Buses (LUB) business in the United Kingdom, which has been accounted for over 11 months. Revenue from these subsidiaries amounted to €253 million.
The varying performances of these businesses had generally been foreseen, in terms of their valuation (Switzerland and three French businesses) and local environment (austerity plan aff ecting the Italian networks, pressure on variable remuneration at LUB).
Other developments in France
Business activity was buoyant compared with 2010 levels (excluding the new subsidiaries) due to the 2010 external growth transactions (Dunois and Flexcité 95), and strong internal growth despite the slower than expected start-up of operations at the subsidiary IXXI associated with delays in RATP projects.
A more difficult economic environment due to the hike in diesel prices, austerity measures such as the reduction in Government “Fillon” subsidies on payroll costs and more stringent contractual conditions.
Numerous bids for contracts in France for the networks in Creil, Perpignan, Chambéry, Charleville-Mézières and Amiens, and the renewal of the Bourges contract and school contracts in the Île-de-France region; RATPDev won two 5-year contracts commencing in 2012 for the Charleville-Mézières city network and the operation of two express coach services for the Île-de-France transport authority.
Other developments outside France
In Italy, core “traditional” business remained stable, boosted by the successful entry into service of the Florence tramway and adversely aff ected by the sharp cut in subsidies due to successive austerity plans.
Business in South Africa performed well with the opening of the second portion of route at the beginning of August, enabling the start of operations on the Johannesburg to Pretoria route.
In the United Kingdom, Bathbus, which operates tourist networks similar to the Paris Open Tour was acquired in February, and Metrolink, which operates and maintains the Manchester tramway network (four lines over 40 km), in August.
Another successful deployment of the Group’s know-how was the start of operations on the bus routes in Macao and the metro in Algiers. Once the trials were completed, the 9.5km (6 mile) route of public passenger services began operations on November 1.
Potential acquisitions were examined in areas where RATP Dev operates, bids were made for contracts in Casablanca (tramway), Hyderabad (metro) and Jersey (bus routes), and the Mac Donald contract was won, off setting a major contract loss in 2010.
On June 30, 2011, RATP and SNCF finalized their agreement to develop transport engineering business through their jointly-held subsidiary, Systra. The Systra reorganization entailed the contribution of two engineering subsidiaries (Xelis from RATP and Inexia from SNCF) and the adaptation of the Group’s governance structure.
On the same date, RATP and SNCF contributed 49% of Xelis and Inexia in exchange for Systra shares.
These contributions were linked to the implementation of the new governance structure, which in the first phase ended the previous joint control exercised by RATP and SNCF (disappearance of Financière Systra) and transferred control of Xelis and Inexia to Systra.
Following the contributions and adjustments to enable equal ownership by RATP and SNCF in Systra, these two shareholders now each hold 39.66%of Systra, compared with 35.85% prior to the transaction.
Xelis and Inexia were fully integrated into Systra on January 3, 2012, with the contribution of the remaining shares.
Since June 30, 2011, Systra and Xelis have been equity-accounted in the financial statements of RATP Group.
This change in consolidation method resulted in the recognition of a gain of €45 million in RATP group’s consolidated net income, in accordance with IAS 31. The interests retained by the Group in Systra and Xelis are now measured to fair value.
Engineering business and results
Systra succeeded in maintaining business activities close to 2010 levels due to growth in the Maghreb, the Crossrail contract in the United Kingdom, high-speed projects in Eastern Europe and tramways in France.
Although Xelis and Inexia performed well and above expectations, Systra faced a number of unfavourable factors, such as exchange rate movements, the termination of highly profi table contracts and the restructuring of two subsidiaries due to the economic crisis.
In addition, the newly-formed Systra incurred (and will continue to incur into 2012) the integration costs arising from the reorganization (in particular the move to a single site at the end of 2012) and the accounting effects of the acquisition price allocation.
With regard to the network’s real estate, marketing & telecoms areas, there was a continual effort to enhance use (new Relay contract, further installation of new brands and services).