Bureau Veritas : Earnings Documents

PRESS RELEASE

N e uil ly - su r- Se ine, France - February 24, 2022

Strong operating and excellent financial performance in 2021;

Solid 2022 outlook

2021 Key figures1

• Revenue of EUR 4,981.1 million for the full year 2021, up 9.4% organically (of which 2.5% in the fourth quarter) and up 8.3% on a reported basis
• Adjusted operating profit of EUR 801.8 million, up 30.4% versus EUR 615.0 million in 2020, representing an adjusted operating margin of 16.1% (16.2% on an organic basis), up 273 basis points versus 2020
• Operating profit of EUR 718.8 million, up 76.4% versus EUR 407.4 million in 2020
• Attributable net profit of EUR 420.9 million, up 235.9% versus EUR 125.3 million in 2020
• Adjusted net profit of EUR 480.8 million (EUR 1.07 per share), up 68.6% versus EUR 285.2 million in 2020
• Free cash flow of EUR 603.0 million (12.1% of Group revenue), led by a disciplined capex policy (2.3% of Group revenue), and a contained working capital requirement (6.3% of Group revenue)
• Adjusted net debt/EBITDA ratio further reduced to 1.1x as of December 31, 2021 versus 1.8x the previous year
• Proposed dividend of EUR 0.53 per share2, up 47.2% year on year, payable in cash

2021 Highlights

• Strong performance of the Group's portfolio of activities, with organic revenue growth across the six businesses. Organic revenue up 3.1% versus 2019
• Strong momentum for Sustainability and ESG-related solutions across the entire portfolio
• Significant strengthening of the Group Balance Sheet and deleveraging
• Acquisition of six bolt-on companies in strategic areas (infrastructure, renewables, sustainability certification, cybersecurity and consumer products in China) representing total revenue of around EUR 48.0 million. This includes the latest acquisition of PreScience, a US-based leader of Project Management/Construction management services for Transportation Infrastructure projects

2022 Outlook

Based on a healthy sales pipeline and the significant growth opportunities related to Sustainability, and assuming there are no severe lockdowns in its main countries of operation due to Covid-19, for the full year 2022 Bureau Veritas expects to:

• Achieve mid-single-digit organic revenue growth;
• Improve the adjusted operating margin;
• Generate sustained strong cash flow, with a cash conversion above 90%.

Didier Michaud-Daniel, Chief Executive Officer, commented:

"Throughout 2021, Bureau Veritas has continued to demonstrate strong agility, and a client centric approach while maintaining innovation efforts. We have delivered strong organic growth, a very healthy margin and strong cash flow which enabled us to achieve the lowest financial leverage since the Group's IPO in 2007 and earnings per share above €1, at €1.07.

We have a clear roadmap with a well-defined strategic direction for 2025 and strong growth opportunities ahead of us, notably as regards Sustainability services which already represent today more than 50% of our sales. Bureau Veritas is uniquely positioned to shape trust around topics that are at the heart of our

1. Alternative performance indicators are presented, defined and reconciled with IFRS in appendices 6 and 7 of this press release.
2. Proposed dividend, subject to Shareholders' Meeting approval on June 24, 2022.

clients' concerns and, of society at large: health, safety, quality, environmental protection and social responsibility.

Demand is clearly on the rise, as evidenced by the interests for our worldwide and multi sector expertise: at BV, we help organizations to measure and monitor their ESG commitments in a more transparent, credible, and data-driven way than self-declaration.

For 2022, we expect Bureau Veritas to deliver another year of sustainable growth. Considering the strong leadership positions of the Group worldwide, and its solid fundamentals, I am very confident about BV's future and the capacity of its 80,000 employees to embrace tremendous new challenges."

KEY 2021 FIGURES

The Board of Directors of Bureau Veritas met on February 23, 2022 and approved the financial statements for the full year 2021. The main consolidated financial items are:

IN EUR MILLIONS	2021	2020	CHANGE	CONSTANT
CURRENCY
Revenue	4,981.1	4,601.0	+8.3%	+9.5%
Adjusted operating profit(a)	801.8	615.0	+30.4%	+32.4%
Adjusted operating margin(a)	16.1%	13.4%	+273bps	+280bps
Operating profit	718.8	407.4	+76.4%	+79.4%
Adjusted net profit(a)	480.8	285.2	+68.6%	+72.0%
Attributable net profit (loss)	420.9	125.3	+235.9%	+243.4%
Adjusted EPS(a)	1.07	0.64	+67.2%	+70.0%
EPS	0.93	0.28	+232.1%	+240.8%
Operating cash flow	790.7	809.1	(2.3)%	(1.8)%
Free cash flow(a)	603.0	634.2	(4.9)%	(4.4)%
Adjusted net financial debt(a)	1,051.4	1,329.1	(20.9)%

(a) Alternative performance indicators are presented, defined and reconciled with IFRS in appendices 6 and 7 of this press release

2021 HIGHLIGHTS

Strong organic revenue growth in the full year

Group revenue increased by 9.4% organically in 2021, benefiting from improving end-markets across most businesses and the return to a more normal operating environment compared to 2020. In the fourth quarter, organic growth was limited to 2.5%, impacted by the cyber-attack which occurred in November 2021. Without this, growth would have reached 4.5% in the last quarter and 9.9% for the full year 2021.

This is reflected as follows by business:

• More than half of the portfolio (including Consumer Products, Certification, and Buildings & Infrastructure) strongly recovered, up 13.3% organically on average. Consumer Products was the best performing activity, up 15.7% over the year (including 9.5% growth in the last quarter) fueled by Asia, the resumption of product launches, and helped by favorable comparables. Certification (up 15.4%) benefited from the catch-up of audits, the recertification effect of certain schemes and strong momentum in Corporate Responsibility and Sustainability Certification services. Buildings & Infrastructure outperformed the Group average with an increase of 11.8% during the year as it benefited from strong momentum across its three platforms (Americas, Asia and Europe);
• A fifth of the portfolio (Industry) delivered 7.5% organic revenue growth during the year with strong business activity for the Power & Utilities segment in particular, including renewables;
• Less than a third of the portfolio (Agri-Food & Commodities and Marine & Offshore) grew at 4.6% organically on average. Agri-Food & Commodities' growth was supported by very favorable market conditions in Metals & Minerals (up 15.8% organically), alongside Government services (up 7.5%). However, the Oil & Petrochemicals segment continued to suffer from lower demand. Marine & Offshore was primarily fueled by strong activity levels in the Core In-service activity.

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Disciplined and selective bolt-on M&A in 2021

During the year 2021, Bureau Veritas completed six M&A transactions in strategic areas, representing around EUR 48.0 million in annualized revenue (or 1.0% of 2021 Group revenue). In the fourth quarter of 2021, Bureau Veritas continued its selective and disciplined M&A activity.

PreScience, in the US Transportation Infrastructure Market

On December 29, 2021, Bureau Veritas acquired PreScience, a US-based leader of Project Management/Construction management services for Transportation Infrastructure projects - highly recognized for its expertise in highways, bridges and rail/transit.

Established in 2013, PreScience supports the construction project lifecycle, from design development through project closeout. With expected revenues of c. USD 25 million in 2021, the company is one of California's leading Project Management, Construction Management, and Construction Engineering & Inspection firms.

	ANNUALIZED	COUNTRY	DATE FIELD OF EXPERTISE
	REVENUE
Buildings & Infrastructure
			Dec.	Project	management	/	Construction
PreScience	c. EUR 21m	United States	management	services	for	Transportation
2021
				Infrastructure projects
Cybersecurity
				Security testing, audit, training and
Secura B.V.	c.EUR 10m	Netherlands	Jan.	certification	services	covering	people,
2021	organization,	and technology (networks,
				systems, applications and data)
Consumer Products
Zhejiang Jianchuang			Feb.	Softlines testing focusing on domestic brands
Testing Technology Services	c.EUR 1.5m	China
20213	and e-shops in China
Company Limited
AET France	EUR 2m	France	Sep.	Laboratory testing, product development and
20214	sustainability testing
Renewable energy
Bradley Construction	EUR 11m	United States	Mar.	Construction	management services	for	the
Management	2021	renewable energy sector
Sustainability Certification
HDAA Australia	c.EUR 3m	Australia	Apr.	Auditing	and	assessments	focused	on	the
2021	health and human services sector

The pipeline of opportunities is healthy, and the Group will continue to deploy a selective bolt-on acquisitions strategy, in targeted strategic areas (notably Buildings & Infrastructure, Renewable Energy, Consumer Products, Technologies and Cybersecurity).

1. Signing on February 4, 2021.
2. Acquisition closed on July 30, 2021 and announced on September 1, 2021.

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Cyber-attack detection

On November 22, 2021, Bureau Veritas announced that its cybersecurity system had detected a cyber-attack on Saturday November 20, 2021.

In response, all the Group's cybersecurity procedures were immediately activated. A preventive decision was made to temporarily take its servers and data offline to protect its clients and the company while further investigations and corrective measures were in progress. This decision generated a partial unavailability or slowdown of services and client interfaces.

On December 2, 2021, Bureau Veritas announced that, thanks to its cybersecurity system preventive and contingency measures, all of the Group's businesses were able to continue operating. As of December 2, 2021, more than 80% of Bureau Veritas operations were running at a normal level, while some regions were still having IT systems running at a reduced rate.

Bureau Veritas' teams, supported by leading third-party IT experts, deployed all efforts to ensure business continuity and minimize disruption to its clients, employees and partners. The Group had also actioned the relevant authorities and its cybersecurity insurance policies.

The Group considers that all its operations have been running at normal level since the beginning of the year 2022. Nevertheless, there are still incident response costs through 2022.

Overall, Bureau Veritas estimates the impact of the cyber-attack (fully accounted for in Q4 2021) to be approximately EUR 25 million on the Group's revenue (around 50 basis points impact on the Group's full-year organic growth).

BUREAU VERITAS IS COMMITED TO ITS EXTRA-FINANCIAL PERFORMANCE

Indexation of the financial terms and conditions of the syndicated credit facility to Environmental, Social and Governance (ESG) indicators

On February 24, 2021, Bureau Veritas announced the signing of an amendment to the 2018 syndicated credit facility for an amount of EUR 600 million in order to incorporate Environmental, Social and Governance (ESG) criteria. Bureau Veritas' social and environmental performance will now be taken into account in the calculation of the financial costs of the facility, and will be measured in light of the Group's quantitative ESG objectives set for 2025.

The three non-financial criteria selected for inclusion in calculating the cost of financing the syndicated credit facility are Total Accident Rate (TAR5); proportion of women in leadership positions6; and CO2 emissions7 per employee (tons per year).

Launch of an ESG solution: with Clarity, Bureau Veritas enables companies to bring transparency and credibility to their ESG commitments

On December 8, 2021, Bureau Veritas announced the launch of Clarity, a suite of solutions that helps companies manage their ESG roadmaps and monitor the progress of their sustainability strategies. With Clarity, Bureau Veritas supports its clients across a wide spectrum of topics, from Social, Health & Safety, Environment, Biodiversity, Climate Change, Business Ethics and Responsible Sourcing to Animal Welfare, Energy Efficiency and Waste Management.

1. TAR: Total Accident Rate (number of accidents with and without lost time x 200,000/number of hours worked).
2. Proportion of women from the Executive Committee to Band II (internal grade corresponding to a management or executive management position) in the Group (number of women on a full-time equivalent basis in a leadership position/total number of full-time equivalents in leadership positions).
3. Greenhouse gas emissions from offices and laboratories, tons of CO2 equivalent net emissions per employee and per year corresponding to scopes 1, 2 and 3 (emissions related to business travel).

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Bureau Veritas has developed Clarity, part of the BV Green Line of services and solutions, in order to make decision-makers' ESG commitments trustworthy. Leveraging BV's global footprint (over 140 countries) and almost 200 years of expertise as an independent TIC company, this integrated solution offers:

• Accuracy: through Clarity's industry-specific assessment modules, companies can measure on the ground the efficient implementation of their sustainability roadmap.
• Trustworthiness: companies can make their sustainability communications more credible. With Bureau Veritas, they can rely on a trusted partner, recognized worldwide for its independence and impartiality.
• Efficiency: companies can efficiently steer their sustainability strategies thanks to a best-in-class digital dashboard, where all field observations are aggregated and sorted to make action prioritization easier.
• Simplicity: companies can use standardized Bureau Veritas assessment checklists for fast implementation or opt for customization to integrate specific needs.

Clarity helps organizations put their sustainability strategies in motion. Through systematic maturity evaluations, the approach helps them clearly define where they should focus their efforts across complex value chains.

Corporate Social Responsibility key indicators and performance

	UNITED				2025
	NATIONS'	FY 2021	FY 2020	FY 2019
	TARGET
	SDGS
SOCIAL & HUMAN CAPITAL
Total Accident Rate (TAR)8	#3	0.27	0.26	0.38	0.26
Proportion of women in leadership positions9	#5	26.5%	27.5%	24.4%	35%
Number of training hours per employee (per year)	#8	29.9	23.9	19.0	35.0
NATURAL CAPITAL
CO2 emissions per employee (tons per year)10	#13	2.49	2.44	2.85	2.00
GOVERNANCE
Proportion of employees trained to the Code of Ethics11	#16	95.8%	98.5%	97.1%	99%

CSR commitment recognized by non-financial rating agencies and Euronext

Bureau Veritas helps companies, governments and public authorities reduce their risks in terms of health, quality, safety, environmental protection and social responsibility. Those challenges are central to societal aspirations. Being a Business to Business to Society company comes with a duty: to be exemplary in terms of sustainability internally, and to be a role model for industry in terms of positive impact on people and the planet.

The Group's commitment is to act responsibly in order to Shape a Better World.

This commitment was again recognized by several non-financial rating agencies during the third quarter. This is a testament to Bureau Veritas' constant efforts regarding sustainability. Since September 17, 2021, Bureau Veritas is listed on the Euronext CAC 40 ESG Index, which identifies the 40 companies that demonstrate the best Environmental, Social and Governance (ESG) practices.

1. TAR: Total Accident Rate (number of accidents with and without lost time x 200,000/number of hours worked).
2. Proportion of women from the Executive Committee to Band II (internal grade corresponding to a management or executive management position) in the Group (number of women on a full-time equivalent basis in a leadership position/total number of full-time equivalents in leadership positions).
3. Greenhouse gas emissions from offices and laboratories, tons of CO2 equivalent net emissions per employee and per year corresponding to scopes 1, 2 and 3 (emissions related to business travel).
4. A new training, following the update of the Code of Ethics, was rolled out in the second half of 2021. The calculation of the indicator became more demanding in 2021. It is no longer limited to measuring the training of only new employees recruited during the year but focuses on measuring the percentage of employees trained in 2021, regardless of their length of service.

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