The ratings on French-based Veolia Environnement S.A. (VE) are underpinned by the company's top-tier global position in water-utility and waste-management activities, as well as its strong European presence in energy services. VE's above-average business profile is underpinned by diversified and recurring revenues under long-term municipal concessions and medium-term industrial outsourcing contracts. These strengths are offset primarily by a moderate, albeit improved, financial profile and by the expectation that VE will focus on growth and improved shareholder returns. VE ranks among Europe's 10 largest utilities, with core EBITDA of €3.1 billion in 2003 (i.e., excluding contributions from non-core U.S. water activities and from the recently sold Fomento de Construcciones y Contrats (FCC)). The group's core divisions include Veolia Water, with Compagnie
