Annual report 2006 - Indaver.com

Annual report 2006 5MissionIndaver is committed to being a constantly innovating,professional organisation with superiorknowledge of waste management, providing itscustomers - companies and public authorities - andthe community with the most sustainable, highqualityintegrated solutions at a reasonable priceand with a fair reward for to its shareholders.Indaver expands ‘Total WasteManagement’ in EuropeTrend towards the outsourcing oftotal waste managementWaste management is becoming increasingly complex. This marketis characterised by stringent environmental regulations andincreasing administrative obligations with which companies andpublic authorities have to comply. In addition to specific regionalwaste legislation, European regulations covering the entire wastemanagement chain are constantly placing more emphasis on theenvironment. All this requires an in-depth familiarity with this complexarea.At the same time, waste treatment possibilities are becomingincreasingly extensive and complex.More and more companies and public authorities are choosing tocall upon a specialist for the total management of all their waste,seeking out a partner who can not only offer the best solutions atan appropriate price, but who is also able to constantly improvethe waste situation proactively and organise waste managementas efficiently as possible. This enables the lowest possible TotalCost of Ownership.The trend for large-scale industry to join forces with one supplierwho can offer integrated waste management, can be clearlyobserved in the Benelux and beyond. With a fully fledged TotalWaste Management product, Indaver has a transparent andflexible one-stop shopping response to the changing needs ofindustry, and our approach to this area is appreciated by bothexisting and new customers. We offer waste producers a widerange of sustainable solutions and services, all of which complystrictly with the law. Indaver also takes care of the extensive andcomplex environmental administration on behalf of its customers.In addition, customers can easily consult detailed reports on therange of waste products managed by Indaver via an extranet.Public authorities, too, are increasingly opting for professionalservice providers capable of offering solutions for a wide range ofwaste flows. Indaver has been a reliable partner in this field formany years. We offer a suitable response to their needs by meansof user’s rights in treatment plants, BOO (Build-Own-Operate)agreements or service contracts.Moreover, Indaver invests in its own high-tech and widely automatedtreatment plants. This provides clear added value for customers.It allows them to hand over responsibility for their wastemanagement without a care at an appropriate price. Indaver isconfident that only a total waste management specialist can offerits customers tailored solutions and provide the best value formoney.Indaver has developed a strong strategic position both in the fieldof ‘industrial waste services’ and as regards ‘municipal solid wasteand assimilated waste’. In fact, these two submarkets interactowing to customers’ increasing demand for the management of allwaste flows, both hazardous and non-hazardous.In short: Indaver provides companies and public authorities withan extensive package of industrial services, offering a wide rangeof waste treatment possibilities both in its own treatment plantsand in cooperation with third parties. We seek the most appropriatesolution in terms of treatment techniques and cost price foreach waste flow. Indaver takes care of the entire - complex - wasteadministration processes and provides an efficient reporting service.This means that customers can focus entirely on their coreactivities.Indaver has evolved from a wastetreatment company to an integratedwaste manager (or one-stop-shoppingpoint for Total Waste Management).

6Indaver, tuning in to sustainable waste managementThe industrial trend to buy in serviceson a European scaleIndaver constantly adapts to its customers' expectations. Not onlydo they require an ever more total solution, but companies are alsolooking more and more frequently for cross-border solutions fortheir various European locations. Business is becoming increasinglyEuropean. Consequently, companies seeking to grow and/orspecialise within Europe are looking to buy in more and more serviceson a European scale.Indaver has evolved from a localFlemish player to a player on theEuropean market.Precisely to meet the growing demand for international wastemanagement, since the mid-1990s, Indaver has been offering itsservices outside Belgium, as well. The company provides totalwaste management, transhipment and treatment services in theNetherlands, Italy, the Czech Republic, Portugal, Poland andIreland. In The Netherlands, Indaver also operates a hydrochloricacid regeneration unit under the terms of a BOO (Build-Own-Operate) contract.This internationalisation is also reflected in the investments.Indaver retains strong roots in Flanders and invests constantly inthe region to be able to respond appropriately to the ever-changingneeds of its Flemish customers. At the same time, a number ofextensions have been carried out in the other European plants, inPortugal, Poland, the Czech Republic, Italy and Ireland. Moreover,by building up a European network, Indaver ensures the cost-effectiveuse of its own processing plants’ capacities.Strategic vision and focusIndaver anticipates and responds to all legal, social, business andtechnological developments relating to waste management.Indaver is committed to establishing a tight-knit partnership withits customers. Activities are always undertaken in harmony withtheir surroundings and with respect for people and the environment.Indaver is one of Europe’s leading total waste management companiesin terms of safety, quality and environmental accountability,as well as openness towards its stakeholders. Its aim is to retainand further consolidate this position. To achieve this goal, theorganisational structure, IT systems and costs level are all alignedwith the group’s strategic vision.Indaver’s organisational structure is characterised by two factors:the fast and flexible provision of services ‘close to home’ and theprovision of services on an international scale. Indaver aims toremain close its customers in order to be able to respond to theirexpectations as efficiently and flexibly as possible. As a result of itsinternational presence, Indaver is also able to gather informationfrom all corners of Europe and pass on that knowledge to its customers.This is reflected in the structure of the company. Indaver is organisedin such a way that the available know-how can be exchangedinternationally, so that it reaches the customer quickly and effectivelyvia the regions. In practical terms, the organisational structureis underpinned by a group management body and threeregional management bodies: for the Benelux, Central and EasternEurope and Ireland. The customer contacts are the account andregional managers, supported by product managers, experts andinternational ‘centres of excellence’This approach offers customers a twofold advantage: they workwith an international group, and at the same time they enjoy thebenefits of a regionally-oriented approach with the best specialistsin the industry. As a customer-oriented company with a wide rangeof services and treatment plants, Indaver is capable of providingthe best solution for them at all times.

Annual report 2006 7Cost leadership‘Cost management’ and ‘quality’ are the most important objectiveswithin the organisation. Indaver aims to provide top-quality solutionsat an economically justified price, but without losing sight ofits further growth in the long term in a free, international market.Benchmarking in the international market has demonstrated thatIndaver operates as one of the most cost-aware waste managementcompanies in the sector.Continually striving to improveIndaver is constantly seeking possible improvements and innovationsfor the services package. Ongoing improvements are an integralelement of the Plan-Do-Check-Act approach adopted for allthe main operating processes, including commercial activities. Theinteractive Balanced Scorecard (BSC) system applied within theoverall project approach is one specific instrument used to measurethe results periodically and clarify the improvements required.Indaver uses the European Foundation for Quality Management(EFQM) business model as a reference framework to continuallyenhance its performance both as regards its financial results andin the field of human relations management, customer satisfactionand the impact of its activities on the environment.Market positionThrough the phased development of its activities, Indaver has kepta clear strategy firmly in mind. It aims to retain its position amongthe top companies in the field of total waste management inEurope in terms of quality, safety and environmental responsibility:■ in the ‘industrial waste services’ segment, the company aimsto rank among the top three in Europe as regards return onequity;■ in the ‘municipal solid waste and assimilated waste’ marketsegment, Indaver plans to remain among the most cost-effectivewaste treatment companies on the specific markets inwhich it operates.By strengthening its customer-oriented services still further, Indaveraims to develop a sustainable relationship with each of its customersin the long term. It also wants to be the best serviceprovider by offering customers a guaranteed problem-free andaffordable solution to their waste problems.

8Indaver, tuning in to sustainable waste managementA unique Total Waste Managementconcept with a dynamicproject approachThe Indaver Total Waste Management concept (TWM) adopts acyclical project approach. This cyclical project approach is based onthe ‘Plan-Do-Check-Act’ principle. This guarantees TWM customersa dynamic approach that does not come to a halt once a contracthas been signed. All the parties - the customer, Indaver and anysubcontractors - are constantly motivated to maintain a high standardof cooperation. In this way, Indaver guarantees that the servicesprovided are not only state-of-the-art and in line with the marketat all times, but also constantly respond to the evolving wishesof the customer.Sharing expertise efficiently within theorganisation and with the customerIndaver is a knowledge-based organisation. It consists of specialistsin various disciplines, who have considerable experience in allaspects of waste management. To share this know-how efficientlyand make it available to the customer, Indaver has set up the necessaryconsultation structures. The ‘TWM Centre of Excellence’gathers together knowledge from the various regions and projectsin which Indaver is involved and disseminates it throughout theorganisation and among the customers. The ‘TWM BusinessDevelopment Team’ monitors the quality of TWM as a product. Inthis way, TWM constantly fulfils the changing needs of the specificsectors in which Indaver operates, and project managers incharge of ongoing TWM projects are continuously challenged tobring about further improvements.Total Waste Management successful once again in 2006The year 2006 brought further confirmation that with the TotalWaste Management product, Indaver is and remains the preferredpartner for the (petro-)chemicals and pharmaceuticals sectors inFlanders. Various contracts were extended and expanded toinclude a TWM service and new TWM projects were implemented.In addition, Indaver continues to offer appropriate customisedtreatment solutions for major waste producers and collection companies.Indaver’s vision, involvement and approach are also highly appreciatedin the Netherlands. In 2006, work continued successfully onthe introduction of the TWM product in Dutch industry. Variouslarge-scale long-term contracts were concluded with leadingchemicals companies.Indaver’s energy strategyAgainst the background of worldwide efforts to reduce the effectsof climate change, the European Union has signed up to the Kyotoprotocol. This commits the European member states to takingmeasures that cut greenhouse gas emissions. The European Unionhas transposed these measures into a series of directives, includingthe directive on promoting the generation of electricity usingrenewable energy resources.Indaver’s energy policy fully supports the achievement of the Kyotoobjectives.It is based upon four strategic pillars:■ recovering as much energy as possible from waste;■ rational energy management;■ restricting the use of fossil fuels;■ maximising the use of renewable energy sources.The various initiatives in this area taken in the three regions areconsidered in more detail below.BeneluxIn the Benelux region, Indaver recovers the energy generated in itsown grate incinerators and rotary kilns. A similar energy policy isalso implemented in the plants where Indaver has a shareholding:these include the SLECO fluidised-bed plant on the Indaver site inBeveren, the anaerobic fermentation unit of the intermunicipalwaste company IVVO, the landfill site of the IntercommunaleVereniging Hooge Maey (organic and landfill gas recovery) and theIVAGO incineration plant.The grate incinerators in Beveren are fitted with a 21-megawattturbine. The SLECO fluidised-bed incinerators have a second turbinewith a capacity of 34 megawatts. As a result, the entire site isa real power station with a capacity of 55 megawatts. In additionto this, 70 tonnes of high-pressure steam per hour are supplieddirectly to a neighbouring company. The total energy production inBeveren corresponds to the annual electricity consumption of140 000 households. A proportion of the electricity generated isconsidered ‘green electricity’. The Flemish Region grants greenpower certificates for electricity generated using renewable energysources. The organic material from the waste that is incinerated isconsidered a renewable energy source.Our unique TWM services combined with our own large-scaletreatment facilities for hazardous and non-hazardous waste in thevicinity of the customer are important assets. They enable Indaverto react flexibly to the expectations of highly demanding customers.Such customer not only count on receiving good service,but also want to avoid all risks relating to safety, quality and liability.

Annual report 2006 9Through its participation in the Intercommunale Vereniging HoogeMaey, Indaver is involved in the recovery of landfill gas to be usedas energy, which is a major element of the remediation project forthis Class 2 landfill site. The waste dumped contains a high level oforganic components which are converted into methane by anaerobicfermentation. Covering the landfill prevents the uncontrolledescape of methane, a greenhouse gas, into the atmosphere.Instead, it is piped via a recovery system to gas-fired turbines thatproduce electricity. Green power certificates are also issued for thistype of energy.Central and Eastern EuropeIn the Central and Eastern Europe region, specifically the CzechRepublic, work began in 2006 on the construction of a turbo-generatorfor the Spovo rotary incinerator in Ostrava. This is equippedwith a high-performance steam boiler for energy recovery and isoperated as a 50/50 joint venture with SITA. The actual start-up ofthe turbo-generator is scheduled for 2007.IrelandAs an EU member state, Ireland is also committed to making animportant contribution towards achieving the Kyoto objectives.However, as a result of the rapid growth in the Irish economy sincethe beginning of the 1990s, this country still has a long way to goif it is to achieve its energy objectives. Indaver’s ‘waste-to-energy’projects will contribute to this.Research and developmentIndaver is constantly working to improve its processing methods.This is done by adapting existing plants or integrating new systemsinto current processes. Changes in environmental legislation arealso resulting in further continuing improvements in existingplants. Consequently, for many years Indaver has been closelymonitoring the development of environmental legislation. Thismeans that when technical modifications are required, Indaver canfirst examine the various alternatives in depth before implementingthe best solution in good time.Indaver is also constantly innovating at its preliminary treatmentand recycling plants in order to broaden the recycling applicationsof the various waste flows as far as possible and to ensure theircontinuity. When implementing upgrades, the main prioritiesinclude protection of the environment, hygienic working conditionsfor staff and top-quality services for customers.Indaver works closely with leading research centres to carry outspecific research assignments. It is also able to call upon the scientificexpertise of its own engineering and QESH (Quality,Environment, Safety & Health) departments.The planned thermal treatment plants in Cork and Carranstownwill both be equipped with a high-efficiency energy-recovery unit.The steam produced is used primarily for heating applications. Theresidual steam is converted into electricity in a steam turbine generator,and most of this is sent directly to the grid.As a result of the project, part of Ireland’s energy will be producedfrom organic waste. By using this renewable energy source, Irelandwill need to import and process less fossil energy.

2Corporategovernance

Annual report 2006 11Indaver’s board of directors and management attach great importanceto the principles of corporate governance. They wish to maketheir corporate governance system transparent and accessible totheir shareholders and all other stakeholders. As an unlisted company,Indaver is not officially obliged to comply with the BelgianCorporate Governance Code - known as the 'Lippens Code'.However, as Indaver fully supports the principles, we use this codeas a framework for the phased and structured development of ourown corporate governance model.Indaver strives to continually improve and develop its corporategovernance system in order to fulfil the expectations of all stakeholdersand be able to react to developments in Belgium andabroad.Shareholder structureUntil the start of 2007, the Flemish Government had a majorityshareholding in Indaver through the ‘Vlaamse Milieuholding nv’(Flemish Environmental Holding nv). In addition, there were 23industrial shareholders, the largest of which as the Belgian utilitycompany Electrabel (14.9 % of the shares). From 1992 onwards,staff and former staff in the group and Indaver itself held almost1 % of the group’s shares in the form of a ‘personnel shares plan’.On 31 December 2006, the shareholder structure was as follows:ShareholdersFlemish Environmental Holding nv 54.20 %Industrial shareholders 44.80 %(Former) staff members and Indaver itself 1.00 %Total 100.00 %Corporate Governance CharterThe board of directors applies Indaver’s own CorporateGovernance Charter. The published guidelines and recommendationsof the Belgian Corporate Governance Code for listed companieswere used as a reference framework for this. The contents willbe adapted further to the new shareholding structure.The Corporate Governance Charter describes the composition andsphere of action of the board of directors. The charter also containsinformation on Indaver shares, way(s) of transferring shares, thepossibility of purchasing own shares and the dividend policy. Inaddition, it includes details on the shareholders and the shareholders’General Meeting.To assist the board of directors with its tasks, and in accordancewith Indaver’s corporate governance system, a number of yearsago the Board set up three specialised committees: the audit committee,the human resources committee and the strategic committee.The role, composition and procedures of each committee havebeen laid down in a charter. The Board always takes the final decisions.The board of directors appoints the management of Indaver. Themembers of the management team are not members of the Board.The board of directors determines the responsibilities, areas ofcompetence and obligations of the management. They monitorand assess management performance. A simplified proxy system,with a restriction on the number of proxy holders and the possibilityof further delegation, has been published in the Belgian OfficialGazette. The text is to be adapted further to the new shareholdingstructure.External and internal auditing procedures guarantee and monitorsound administration. In addition, various quality systems areapplied, as well as other internal, integrated and, wherever possible,automated monitoring systems.In early February 2007, Electrabel sold its holding in Indaver to itssister company, Suez Environment. On 15 February 2007, theagreement was signed for the sale of some of the shares owned bythe Vlaamse Milieuholding and a number of private shareholdersto Delta nv. On 16 March 2007, Delta nv became Indaver’s newmajority shareholder.Since then, the shareholder structure has been as follows:ShareholdersDelta 60.10 %Flemish Environmental Holding nv 16.00 %Group of industrial shareholders 9.00 %Suez Environment 14.90 %Total 100.00 %

12Corporate governanceBoard of directorsAs at the end of 2006, the board of directors was as follows:Chairman:Roland Van DierdonckProfessor, Dean at Vlerick Leuven Gent Management SchoolVice-chairman:Luc Sterckx (*)Chief Executive Officer SPE nvDirectors:Hilde DerdeLawyerFrans DieryckManaging Director, Fedichem VlaanderenYvan Dupon (**)Business Manager, Yvan Dupon Consult bvbaFrank Gérard (***)Senior Investment Manager, Vlaamse Milieuholding nvRoger MaenhautCompany directorDirk GekiereGeneral Manager, Ineos Oxide nvAchiel Ossaer (****)Business Manager, Oval bvbaJan Van den BerghManaging Director, Degussa Antwerpen nvFrank Van SevencotenGeneral Administrator, Flemish Environment AgencyIvo Van VaerenberghCompany director(*) Mr Luc Sterckx represents K.E.M.P. nv, director of Indaver nv(**) Mr Yvan Dupon represents Yvan Dupon Consult bvba,director of Indaver nv (until 18 April 2007)(***) Mr Frank Gérard represents the Vlaamse Milieuholding nv,director of Indaver nv(****) Mr Achiel Ossaer represents OVAL bvba, director of Indaver nvIn 2006, the board of directors met eight times. The possibility of a‘written procedure’ provided for by law was used once.Modifications to the board of directors in 2006On 27 June 2006, Mr Hugo Vanderpoorten resigned as a memberof the board of directors. Ms Hilde Derde was approved as his successorat the meeting on 5 October 2006.On 18 October 2006, Mr Paul Nauwelaerts resigned. Mr DirkGekiere was approved as his successor at the meeting of 18December 2006.New board of directorsOn 16 March 2007, the composition of the Board of Directors wassubstantially modified further to the new shareholder structure.The following people and companies were appointed as directors:■ Peter Boerma■ Willem Keus■ Frank van den Heuvel■ Colin Lustenhouwer■ Wilhelmien van Montfrans-Hartman■ Guy De Clercq■ Flemish Environmental Holding nv,represented by Roland Van Dierdonck■ OVAL bvba, represented by Achiel Ossaer■ Yvan Dupon Consult bvba, represented by Yvan DuponOn 18 April 2007 Mr Peter Boerma was appointed as chairmanand Mr Willem Keus as vice-chairman of the board of directors.On 18 April 2007, Yvan Dupon Consult bvba resigned and wasreplaced by Suez Environment sa, represented by Yvan Dupon.On 19 April 2007 Mr Colin Lustenhouwer resigned and P& EManagement sprl, represented by Mr Paul Vanfrachem wasapproved as his successor.Specialised committees set up withinthe board of directorsThe audit committeeThe audit committee is composed of four directors: Mr Luc Sterckx(chairman), Mr Frank Gérard, Mr Roland Van Dierdonck and Mr JanVan den Bergh.The audit committee meets at least twice a year. In 2006, it metfour times.The main duties and responsibilities of this committee include:■ objectively assessing the company’s financial reporting systemand internal auditing system;■ advising the Board of Directors on its supervision of the company’sfinancial position and the preparation of the financialstatements and the budget;■ objectively assessing the company’s safety and environmentalpolicy, including the reporting and the internal auditingsystems related thereto;

Annual report 2006 13■ assessing the audit activities of both the external statutoryauditor and the internal audit department;■ ensuring open communication between the audit committee,the management, the statutory auditor and the internal auditdepartment.The human resources committeeThe human resources committee is composed of the ChiefExecutive Officer and the following four directors: Mr Achiel Ossaer(chairman), Mr Yvan Dupon, Mr Frank Gérard and Mr Ivo VanVaerenbergh.This committee meets at least twice a year. In 2006, it met threetimes.It is charged with making recommendations on:■ the general human resources strategy;■ the organisation and development of the company;■ the selection/appointment of the members of the executivemanagement;■ the remuneration policy;■ the annual remuneration of the executive management.The strategic committeeThe strategic committee is composed of five directors: Mr AchielOssaer (chairman), Mr Luc Sterckx, , Mr Roland Van Dierdonck,Mr Ivo Van Vaerenbergh and Mr Frank Gérard.In 2006, attention focused on intensive supervision of the projectfor the new shareholding structure and the choice of a strategicpartner for the further implementation of Indaver's growth strategy.The tasks of the strategic committee were undertaken by a ‘supportcommittee’ made up of all members of the strategic committee.This committee’s task is as follows:■ objectively guiding the development of and adjustments to thecorporate strategy;■ objectively assessing the feasibility of the strategic objectives;■ assessing the availability of the necessary resources in order toimplement the chosen strategy;■ assessing the measures actually in place to implement thechosen strategy;■ examining the risks of the chosen strategy.In addition, the strategic committee also makes recommendationson how to optimise the shareholder structure and defines theappropriate steps to achieve that goal.ManagementRonny AnsomsChief Executive Officer,Business Manager Municipal Solid Waste and Assimilated WastePaul De BruyckerRegional Manager Benelux,Business Manager Industrial Waste ServicesJohn AhernRegional Manager IrelandJo BuekensRegional Manager Central and Eastern EuropeBusiness Development ManagerMichel DecorteChief Financial OfficerGuido ExChief Technical OfficerGuido WautersQuality, Environment, Safety and Health ManagerMarcel CeulemansHR ManagerContactJos ArtoisManager CommunicationInternal auditsThe internal auditor functions independently within the company.The audit committee ensures his independence. It is the internalauditor’s task to conduct internal audits and to establish systemsof internal checks. He reports to the audit committee and the managementcommittee.Corporate auditorThe firm of auditors Van Passel, Mazars & Guerard, represented byMr Hugo Van Passel, has been appointed as corporate auditor ofIndaver nv. The consolidated company results have also been preparedunder his control. Some of the group’s subsidiaries rely onthe services of other corporate auditors.

14Corporate governanceGroup structureINDAVER nvINTERNATIONAL ACTIVITIESWASTE TREATMENT: participations BelgiumOWN ACTIVITIES / SITESAROC-NL B.V. (THE NETHERLANDS)INDAVER ITALIA s.r.l.INDAVER IRELAND ltd.INDAVER PORTUGAL s.a.INDAVER SCHWEIZ AGINDAVER UK ltd.INTEREKO Sp. z o. o. (POLAND)SPOVO a.s. (CZECH REPUBLIC)100%100%100%100%100100%98,36%50%INDAVER PARTICIPATIES nvINDAVER LOGISTICS nvSLECO-CENTRALE nvSVEX nvSPANIN nvRECYGOM nvINDAVER RELIGHT nvWIPS nvVLAR PAPIER nvGRL GLASRECYCLING nvSITA Decontamination nv100%100%50%50%50%50%50%50%35%35%26%INDAVER ANTWERPENINDAVER BEVERENINDAVER GRIMBERGENINDAVER KALLOINDAVER MECHELENINDAVER NIVELLESINDAVER MILIEUPARK WILLEBROEKINDUSTRIAL WASTE SERVICES EUROPEPUBLIC-PRIVATE PARTNERSHIPS Belgium50%12,59%43%30%35%39,90%ECOV nvECOWEST nv50%1,5%IVAGO cvbaIVVO cvbaIVIO cvbaIHM cvbaIBOGEM cvbaVERKO nvIndaver’s structure reflects its business responsibilities and regionalresponsibilities. Indaver now operates in eight European countries.These are grouped together in three regions: ‘Benelux’,‘Central and Eastern Europe’ and ‘Ireland’.The diagram showing the group structure, giving the percentagesof the direct or indirect shareholdings in Indaver, includes the mainsubsidiaries and participating interests.A number of direct and indirect subsidiaries and participatinginterests are not indicated, including:■ Lokrum Ltd (subsidiary of Indaver Ireland Ltd);■ SIBAG AG (subsidiary of Indaver Schweiz AG);■ Indaver Servisi d.o.o (in liquidation);■ Recysol bvba (no operational activities);■ Vera nv (no operational activities);■ Vlabraver (in liquidation).In the context of the planned divestments in Switzerland and inline with the efforts being made to simplify its group structure,Indaver carried out the following restructuring measures in 2006:■ sale of the subsidiaries of Indaver Schweiz, formerly theEXPOS group;■ sale of the 100 % holding in Amstutz (and subsidiarySchmucki) and 75 % of Indaver’s holding in SIBAG AG.A 25 % holding in SIBAG was retained;■ sale of the 50 % holding in Apparec to Van Gansewinkel;■ liquidation of Recyclagepark Limburg nv;■ sale of the small holding of 1.35 % in Revatech to themajority shareholders;■ establishment of Indaver Portugal. The activities and assetsof the Portuguese branch of Indaver were taken over byIndaver Portugal s.a.;■ modification of the legal form of Spovo s.r.o. to Spovo a.s.

Annual report 2006 15Activities of the Indaver groupThe Indaver group, headquartered in Belgium, provides its customerswith high-quality, total waste management solutions. Itcombines the strengths of a customer-oriented service companywith the in-depth technological know-how of the various wastemanagement processes. The range includes the following:■ total management of hazardous waste (permit, classification,packaging waste at the customers’ sites, organising transportto the final destination, final disposal, recovery and treatment);■ total management of household and comparable industrialwaste (legal and technical advice, organising transport to thefinal destination, recovery and final processing).Activities of Indaver nv on sites in BelgiumAntwerp site■ Rotary kilns with energy recovery and extensive flue gaswashing: thermal treatment of industrial and small hazardouswaste;■ Thin film evaporator; solvent recycling;■ Static kiln: treatment of liquid chlorinated hydrocarbons;■ Physico-chemical unit for the treatment of liquid inorganicwater materials: neutralisation of acids and bases, oxidationof cyanide, reduction of chromates, emulsion breaking (of oilwateremulsion, latex emulsions), precipitation of heavymetals, sludge dehydration in filter presses;■ Solidification unit: Neutralisation of solid inorganic waste;■ Class 1 landfill site: depositing of solid and non-toxicindustrial waste.Beveren site■ Grate incinerators with energy recovery and thorough flue gaswashing: thermal treatment of household waste and comparableindustrial waste;■ Fluidised-bed incinerators with thorough flue gas washing andenergy recovery: thermal treatment of high calorific valueresidual waste and sludge (SLECO, 50/50 joint venturebetween Indaver and SITA);■ Ash treatment unit: extensive purification and recovery ofincineration ashes;■ Class 1 landfill site: depositing of the residues from incinerationprocesses, residues from the physico-chemical units andother solid, non-toxic waste;■ Preliminary treatment unit: high calorific value waste that cannotbe recycled is purified and turned into pellets;■ Treatment plant for lamps and other mercurial waste (IndaverRelight, 50/50 joint venture between Indaver and AVR).Willebroek site■ Sorting and purification unit for plastic bottles and containers,metal packaging and drinks cartons;■ Treatment plant for paper from authorities and companies;■ Treatment plant for rubber tyre crushing;■ Treatment plant unit for plastics: crushing and baling of variousplastics from companies with a view to recycling;■ Acceptance and shredding of green waste;■ Pre-treatment plant for wood waste;.■ Transfer of household waste and bulky waste.Grimbergen site■ Aerobic composting of vegetable, fruit and garden waste andorganic industrial waste;■ Transhipment of household waste.

16Corporate governanceIndaver nv holdings in BelgiumIndaver Logistics nv (Indaver 100 %): transport of non-hazardouswaste and management of a car fleet and recycling unit.Indaver Participaties nv (Indaver 100 %): company that operatesas a holding company and groups together Indaver shareholdingsin other companies.Indaver Relight nv (Indaver 50 % - AVR (NL) 50 %): facility forprocessing and recycling tl lamps and other waste containing mercury.Recygom nv (Indaver 50 % - SITA 50 %): processing of used rubbertyres and rubber waste. Recygom operates mainly in Wallonia.SLECO-Centrale nv (Indaver 50 % - SITA 50 %): fluidised-bedincinerators for the thermal treatment of highly calorific waste andsludge with thorough flue gas cleansing and energy recovery.SVEX nv (Indaver 50 % - SITA 50 %): operation and maintenanceof three grate incinerator lines and three fluidised-bed lines on theBeveren site.Spanin nv (Indaver 50 % - Spano 50 %): collection and preliminarytreatment of waste wood.Wips nv (Indaver 50 % - SITA 50 %): aerobic composting plant(concession agreement) for fruit, vegetable and garden waste andorganic industrial waste.VLAR Papier nv (Indaver 35 % - Stora Enso 65 %): treatmentplants for sorting and cleaning paper and cardboard.GRL Glass Recycling nv (Indaver 35 % - VSB Holding 65 %): glassrecycling.SITA Decontamination nv (Indaver 26 % - AVR 23 % - SITA 51 %):treatment of discarded transformers and condensators containingPCB.Public-private partnerships in BelgiumIVAGO cvba (ECOV 50 % (INDAVER 50 % - SITA 50 %) - city ofGhent and municipality of Destelbergen, intermunicipal partnershipsIDM and IVLA).IVAGO is an intermunicipal partnership responsible for the collectionof household and assimilated waste, the public cleaning of thecity of Ghent and the thermal treatment of household and assimilatedwaste.IBOGEM cvba (INDAVER 35 % - municipalities of Beveren,Kruibeke and Zwijndrecht, VERKO, city of Antwerp, intermunicipalpartnerships MIWA, ISVAG, IGEAN Milieu & Veiligheid).IBOGEM is an intermunicipal partnership for sustainable wastemanagement in the municipalities of Beveren, Kruibeke andZwijndrecht. In addition, IBOGEM also operates a recycling centre.As a private partner, Indaver helps with the implementation of theIBOGEM waste policy aimed at the prevention of waste. IBOGEMpossesses a composting plant for green waste, the operation ofwhich it has transferred to Indaver by statute.IVIO cvba (Ecowest 2 % (Indaver 42.61 %) – city of Izegem, tenother municipalities and the remaining six intermunicipal partnershipsin West Flanders).The intermunicipal partnership IVIO implements a waste policy thatstrongly emphasises the importance of waste prevention andrecycling.IVVO cvba (Indaver 12.58 % - city of Ieper and 11 other municipalities,the six remaining intermunicipal partnerships in WestFlanders, intermunicipal partnerships IVM and Verko nv).IVVO has a composting plant for the anaerobic fermentation ofhousehold vegetables, fruit and garden waste and organicindustrial waste.Intercommunale Vereniging Hooge Maey cvba (Indaver 30 % -city of Antwerp, municipalities of Aartselaar, Bornem, Duffel,Kapellen and Stabroek and the intermunicipal partnerships IGEANMilieu & Veiligheid, IVAREM, IBOGEM and ISVAG).The Intercommunale Vereniging Hooge Maey was established tofacilitate the remediation and operation of the ‘Hooge Maey’ Class2 landfill site. Indaver’s statutory responsibility is the operation ofthe landfill site: drawing up a sustainable remediation project,including design and layout and day-to-day management.Verko nv (Indaver 39.9 % - municipality of Dendermonde andeight other municipalities, IBOGEM, intermunicipal partnershipDurme-Moervaart and Province of East Flanders).Verko has an aerobic composting plant for household vegetables,fruit and garden waste, organic industrial waste and green waste.

Annual report 2006 17Activities in The NetherlandsThe marketing of the Total Waste Management product for largescaleindustry in the Netherlands is undertaken by Indaver nv.AROC bv is a fully-owned subsidiary that operates a roasting incineratorfor the regeneration of hydrochloric acid under a BOO contract(Build-Own-Operate) for the steel producing company Corus(NL).Activities in IrelandIndaver Ireland ltd, market leader in Ireland for the collection andtreatment of hazardous waste materials. The range includes:■ total management of hazardous waste (permit, classification,packaging waste at the customers’ sites, organising transportto the final destination, final disposal, recovery and treatment);■ bulk solvent treatment;■ newspaper and magazine recycling service in Leinster andMunster. The company collects newspapers and magazines fromnewspaper shops, large companies and public authorities;■ management of waste electrical and electronic equipment;■ operating six recycling centres for household and industrialwaste.The branch office is responsible for developing and setting upmajor infrastructure projects for waste processing in Ireland.Activities in SwitzerlandIndaver’s activities taken over and developed in Switzerland nolonger met the company’s expectations, so in the course of 2006Indaver sold virtually all its Swiss activities to local companies.Indaver still retains via Indaver Schweiz AG a limited and temporaryholding in SIBAG (collection and physico-chemical treatmentof waste). In addition, Indaver still owns a site with an office buildingand a production plant.Activities in the Czech RepublicSpovo a.s. (Indaver 50 % - SITA 50 %): a rotary incinerator withenergy recovery and thorough gas washing for the thermal treatmentof hazardous industrial waste.Commercial activities andtransfer centres in EuropeIndaver has commercial activities and operates transfer stations inBelgium, Ireland, Italy Poland and Portugal. In practice, this is donerespectively by Indaver (Beveren, Willebroek, Grimbergen, Kallo),Indaver Ireland (Dublin), Indaver Italia (Origgio), Intereko (Opole)and Indaver Portugal (Lisbon, Abrantes).This international structure offers various advantages. It supportsthe European network of total waste management services atIndaver plants throughout Europe. It offers Indaver sustainablesolutions for the collection, treatment, recycling and final processingof hazardous waste. The network ensures that the capacitiesavailable at the company’s own treatment plants are always usedcost-effectively.

3Changes toshareholder structure

Annual report 2006 19At the proposal of the Flemish Minister for Public Works, Energy,the Environment and Nature, Kris Peeters, in December 2005 theFlemish Government decided to relaunch the procedure for thesale of a proportion of the shares held by the FlemishEnvironmental Holding (Vlaamse Milieuholding) in Indaver.The Flemish government outlined the following reference frameworkto achieve the sale of part of its shareholding in Indaver:■ the current shareholders give the future strategicshareholder(s) the opportunity to obtain a stake in Indaver inexcess of 50 %;■ the Flemish government will retain a shareholding that willmake it possible to form a representative minority (at least25 %), together with the existing industrial shareholders;■ arrangements will be made between the existing and the newstrategic shareholder(s) regarding corporate governance andother issues.In March 2006 the Flemish Environmental Holding began theselection process to find a new strategic partner for Indaver. Therewere two basic tenets:■ the Flemish authority, together with the industrial groups, wasto retain a significant minority holding to ensure that Indaverremains rooted in Flanders;■ a strategic partner was to be chosen who intends to supportIndaver's strategy for further growth.In an initial phase, around 60 candidates were contacted. Six candidateswere selected from among the 12 indicative, non-bindingbids. At the end of October 2006 five of these submitted a bindingbid. In a third phase, two candidates were retained for further discussions.The following criteria were adopted for the selectionprocess: price, financial capacity of the bidding party, strategy,terms and conditions of the sales agreement, relations betweenfuture shareholders, conditionality of the bid and the timing for theconclusion of the transaction.On 12 December 2006, the board of directors of the FlemishEnvironmental Holding selected Delta nv as the final candidate.The agreement of sale was officially signed by the FlemishEnvironmental Holding, Delta, the six remaining industrial shareholdersand the sixteen industrial shareholders who were sellingtheir shares on 15 February 2007. Delta became the new majorityshareholder on 16 March 2007.Delta owns a majority stake of 60.1 % in Indaver. The FlemishEnvironmental Holding (16 %) and the group of industrial shareholders(BASF, Bayer, Borealis Polymers, Janssen Pharmaceutica,Solvay and Tessenderlo Chemie) with 9 %, together hold 25 % ofthe shares. Suez Environment, which took over the sharesbelonging to Electrabel at the beginning of February, has a 14.9 %holding.

4Key figures for 2006

Annual report 2006 212004 20052006Overview of the main financial data(in EUR million)Financial Data 2006 (in EUR million)Operating income 233.49EBITDA* 32.54Operating result (EBIT) 15.56Net profit 11.51Capital 87.35Equity capital 126.90* EBITDA= profit (loss) from operations + depreciation and amortisation+ impairment losses, net + provisions + IAS 19 post employment benefitprovisions (including taxes) - recognised revenue related to up-frontpayments for long-term waste treatment contractsOperating income(in EUR million)2004: 209.282005: 209.842006: 233.492004 2005 2006200420052006200520062004EBITDA(in EUR million)2004: 34.432005: 32.982006: 32.54Operating result (EBIT)(in EUR million)2004: 8.332005: 12.812006: 15.56Consolidated profitafter taxes (in EUR million)2004: 2.252005: 14.522006: 11.51

5Most important eventsin 2006 per region

Annual report 2006 23BeneluxThe new fluidised-bed plant in BeverenIndaver has developed a series of complementary waste treatmentunits for non-recoverable, non-hazardous waste on its site inBeveren. The new fluidised-bed plant of SLECO - a partnershipbetween Indaver and SITA Belgium - increases the range of treatmentpossibilities available.The new fluidised-bed plant makes the Beveren sitea real power stationAs both the grate incinerator and the SLECO fluidised-bed incineratorare equipped with a turbo-generator, the electricity generatedon the site corresponds to the annual consumption of 140 000households. The site will be able to cater for its own energyrequirements using the energy generated by the six incineratorlines. However, the vast majority of the energy produced will besent to the grid.The new fluidised-bed plant is fully in line with afuture-oriented waste and climate policyAmid great interest, the Flemish minister Kris Peeters officiallyopened the new fluidised-bed plant in Beveren in September2006. The plant is designed for a capacity of 460 000 tonnes. Nonrecoverablewaste, sludge from water treatment plants and industrialsludge undergoes thermal treatment here, with maximumenergy recovery and intensive flue gas purification. With an investmentvalue of 180 million euro, this is the largest waste treatmentplant in Belgium and the biggest of its type in Europe.Fluidised-bed technology in practiceIn the fluidised-bed incinerators, waste and sludge are incineratedat a temperature of 850 °C. A fluidised-bed is a layer of sand thatswirls under the effect of hot air. Waste and/or sludge are mixed inwith the sand and fully incinerated. The calorific content of thewaste keeps the temperature of the mass steady and the residualheat is recovered in a steam boiler. The steam produced is convertedinto electricity by means of a turbo-generator.Intensive flue gas purificationIn the flue gas purification plant, flue gases are intensively purifieduntil they comply with emission standards which are more stringentthan those imposed by European regulations. All nitrogenoxides, matter, chlorine, sulphur and other hazardous componentsare removed in successive stages. The washing water and otherresidual flows are treated using environmentally sound methods.The purified and cooled flue gases are constantly sampled andanalysed to be sure that they always comply with the stringentstandards.Flanders’ waste policy gives priority to the prevention and recoveryof waste. It achieves this very successfully. To do this, there must beadequate treatment capacity available for non-recoverable waste.Flanders is also investing heavily in water purification, and this isproducing a growing volume of sludge. For sludge that cannot beput to good use, the best choice is incineration with maximumenergy recovery. Indaver fully supports this policy vision. This iswhy, in the context of SLECO, the company opted in favour of combinedtreatment of non-recoverable waste and sludge in a stateof-the-artfluidised-bed plant with maximum energy recovery.Fluidised-bed technology is the Best Available Technique for this.

24Most important events in 2006 per regionWaste treatment in province ofAntwerp radically streamlinedWith the final signing on 25 January 2006 of a number of cooperationagreements between IBOGEM (in which Indaver has a 35 %stake), the city of Antwerp and the intermunicipal waste companiesIGEAN and ISVAG, waste treatment in much of the province ofAntwerp has been optimally streamlined. IBOGEM formed the finalelement in this partnership for the treatment of residue waste suitablefor incineration and vegetable, fruit and garden waste.IGEAN joined the intermunicipal association ISVAG early in 2006.This means that since then, IGEAN’s household residue waste hasalso been treated by ISVAG. This streamlining helped with themobility problem straight away. As ISVAG is unable to treat all thisresidue waste in its own plant, arrangements were made for22 000 tonnes of this are to be treated via IBOGEM in the Indaverplants, exercising IBOGEM’s user rights. During the maintenancework scheduled to be carried out at ISVAG in particular, some ofthe supply will be diverted to IBOGEM. Conversely, during quieterperiods Indaver will supplement the supply to ISVAG, so that theplants can continue to operate at full capacity.This strategic cooperation also optimises the selective collectionand treatment of vegetable, fruit and garden waste. All vegetable,fruit and garden waste from the Antwerp region is treated byIGEAN Milieu en Veiligheid. Under the terms of the agreement,IGEAN will call upon IBOGEM for the quantity it is unable to treatin its own plant, amounting to around 10 000 tonnes.Impeccable residue waste treatment in Flemish BrabantIndaver has been treating the household waste from the provinceof Flemish Brabant since July 2005. In addition to the five intermunicipalwaste treatment companies in Flemish Brabant, themunicipality of Wemmel also joined in 2006, followed on 1 January2007 by the municipality of Wezembeek-Oppem.The planning and organisation of the transport to five transfer stationsand to Indaver’s grate incinerators in Beveren ran smoothly,thanks to the integrated SAP system and flawless logistics coordinationwith Indaver Logistics.IVAGO inaugurates an energy recovery plantAt the end of September 2006 the intermunicipal partnershipIVAGO opened its brand-new energy recovery unit in the presenceof the vice-minister-president of the Flemish Government, FientjeMoerman. Indaver is jointly responsible for the management ofIVAGO, along with SITA.Thanks to this public-private partnership, the incineration plantwas very quickly optimised and may now be regarded as ‘state-ofthe-art’.Most of the energy is used directly to produce heat: heatingfor the IVAGO buildings, heating flue gases in the ‘deNOx’plant and pre-heating the air beneath the incinerating grates.Around half the steam is sent to the nearby Ghent UniversityHospital in accordance with a long-term contract. A steam turbineand an alternator convert the rest of the steam into electricity forthe plant's own use. The steam and condensate are carried via adouble underground pipeline.This project involves an investment of 34 million euro. This amountwill be recovered by means of the reduced environment levy, thesale of steam and electricity, the green energy certificates and thereduction in IVAGO’s energy bill.ECOWEST begins collecting green wasteOn 1 January 2006, ECOWEST - in which Indaver has a 43 % holding- began the three-monthly collection of green waste fromhome in eight municipalities in the intermunicipal partnership IVIO.ECOWEST is the private partner in this intermunicipal partnershipand is responsible for the technical, commercial and financial management.Record supply to Hooge MaeyThe Intercommunale Vereniging Hooge Maey recorded the largestsupply in its history in 2006: 349 270 tonnes. The landfill site didnot have any relevant impact on the environment. An extension ofthe operation of the current landfill zone until July 2009 was grantedin 2006. The environmental impact report was declared in orderand approved by the environmental authorities. An environmentalpermit was also granted for a second landfill. Work on establishingthe site was put out tender and is expected to begin in thespring of 2007.Construction of a bridge over the railway line passing through thesite was completed in February 2006.During the course of the year, the gas-fired turbines produced9 591 MWh of electricity. In addition, the residual heat from thegas-fired turbines was used to heat the buildings. A third gas-firedturbine was installed in May 2007. A total of five turbines areplanned and will be installed in phases.

26Most important events in 2006 per regionThe public tender procedure for the detailed design and constructionof the plant started in 2006. Of the five ‘turnkey’ contractorswho expressed interest, Indaver has selected two candidates. Theprocedure and choice of the contractor will completed in thecourse of the next few months. Construction work is scheduled tobegin towards the end of 2007 and last two years.In 2006 Indaver Ireland also began the required approved processfor the supply and sale of electricity.The Cork Waste Management FacilityThe thermal treatment of municipal solid waste is not part of thelocal authority waste strategy in Cork at the moment. However, theregion is planning to re-examine the need for the thermal treatmentof residue waste. In 2007 Indaver will enter into discussionswith the authorities concerned with a view to defining a futurewaste strategy for the region together.A few years ago, the Irish Planning Board gave Indaver Ireland permissionto construct a waste management centre in Cork. A numberof local residents’ organisations are endeavouring to have thisdecision reviewed. No public hearing has so far taken place. TheCourt is waiting for a final decision from the Supreme Courtregarding the project in County Meath.A terminal in the port of DublinIndaver is proposing to extend its hazardous waste plant in theport of Dublin to include a sea terminal for the temporary storageof solvents to be shipped to the ‘waste-to-energy’ plants on theEuropean mainland. An environmental impact report has nowbeen drawn up. The approval process is scheduled to begin in2007.Central and Eastern EuropePoland and Italy are the two main areas for the further growth anddevelopment of Indaver’s activities in this region over the comingyears. In addition, the company acted mainly as a top-quality treatmentprovider for specific waste flows in the Czech Republic.In 2006 the region developed and implemented a clear HR strategywhich is fully in line with that of the Indaver group. It is gearedto putting together a competent, versatile and motivated team.This will enable the region to offer the most customer-friendly, flexibleand dynamic solutions in line with customers’ requirements.Strong growth in PolandIntereko is responsible for the collection, storage, preliminary treatmentand transport of hazardous waste from small, medium-sizedand large companies. The transfer station operated at full capacityin 2006. In 2006 Intereko also built a sorting line for electrical andelectronic appliances, mainly from industry.Due partly to the rising demand among customers for Total WasteManagement, in 2006 Intereko focused increasingly on providingthis service. In this regard, they provided consultancy services andprofessional advice on waste management as well as helping companiesto draw up waste management plans. Intereko also specialisesin monitoring dumping activities and remediation. Thecompany successfully completed various remediation projects in2006, mainly relating to contaminated industrial land and oldlandfill sites.Intereko is the market leader for collecting and treating waste containingPCB in Poland. As a result of the expertise available in theIndaver Group as regards this waste flow, Intereko is able to provideits customers with the most responsible solution in terms ofboth economics and the environment. Treatment mainly takesplace abroad.

Annual report 2006 27Czech Republic the most up-to-date treatmentplant in Central and Eastern EuropeIntereko has clear potential for growth. The company took otherinitiatives to stimulate growth in 2006. It is seeking to do this bothby expanding its own activities and through acquisitions.Intereko has a highly dynamic, motivated and flexible workforce.The organisation was further expanded in 2006. This strengthenedorganisation, combined with its knowledge of the specific marketsituation in Poland, guarantees the quality of the services providedand further supports the company’s growth opportunities.Indaver Italy becomes a major player on the hazardouswaste marketThe transfer station operated by Indaver Italy in Origgio, nearVarese, transfers both hazardous and non-hazardous waste. It hasbeen fully operational since 2006. Indaver Italy transfers hazardouswaste safely to authorised treatment plans and has become amajor player on the market. In addition, Indaver Italy can accepthazardous waste in an appropriate treatment unit on its own siteand - if necessary - pack or repack it for more efficient storage andtransport. Selectively collected, non-hazardous waste is taken torecycling centres. Hazardous waste is treated at plants in theIndaver group or by partners.In 2006 Indaver Italy worked increasingly directly with major customersfor the treatment of various waste flows. This was also thecase for a number of total waste management projects mainly withcompanies in the chemicals and petrochemicals sector. IndaverItaly has adapted its organisation and strengthened its managementto make the most of this development. Indaver Italy hasmade the necessary preparations to obtain EMAS registration in2007.Thermal treatment is under great pressure as regards prices in theCzech Republic on account of the low cost of dumping waste atlandfill sites. Nevertheless, the Spovo plant operated at full capacityin 2006 and profitability improved. The Spovo rotary incineratoris the largest and most up-to-date plant of its kind in the CzechRepublic. It is the only plant capable of treating the most difficulttypes of waste, such as waste containing freons and PCB. The planhas ISO 14401, IS0 9001 and OHSAS 18001 certificates and operatesfully in line with all EU directives. This represents a significantadvantage in a country that finds it extremely difficult to complywith European environmental standards on a number of fronts.In 2006, Spovo introduced a number of energy-saving measuresand conducted a thorough assessment of its current energy production.The energy released through incineration is used to producesteam. This is used by the chemicals industry in the vicinity ofthe incinerating plant, as well as to heat flue gases, resulting inconsiderable energy savings. Work began on the construction of anappropriate turbo-generator in 2006. This is scheduled to be operationalin mid-2007.Switzerland further growth through partnershipIndaver’s activities taken over and developed in Switzerland nolonger met the company’s expectations, so in the course of 2006Indaver sold virtually all its Swiss activities to local companies.Indaver still retains via Indaver Schweiz a limited and temporaryholding in SIBAG (collection and physico-chemical treatment ofwaste). In addition, Indaver still owns a site with an office buildingand a production plant.Italy is an important growth market for Indaver. Both the expansionof its own activities and acquisitions offer potential with a view toproviding Total Waste Management services for major companies.

6Corporate socialresponsibility

Annual report 2006 29Indaver does its utmost to ensure that all its operations are carriedout in a socially responsible manner. In addition, Indaver is responsiblefor ensuring the health and safety at work of all its employees,as well as protecting those concerned outside the companyand the environment. These aspects of Corporate SocialResponsibility are among its main priorities. They are integratedinto all activities on the shop floor and into all company decisions.In its annual sustainability report, Indaver Benelux provides anaccount of its performance of the previous year in the fields ofsafety, the environment, quality and openness. The sustainabilityreport can be consulted on Indaver’s websites: www.indaver.beand www.indaver.com.Personnel: numbers and trainingAt the end of 2006, the Indaver Group employed 713 people, 532of whom were white-collar workers and 181 blue-collar workers. Atotal of 405 members of staff are employed at Indaver sites inBelgium and 138 people in companies in which Indaver holdsmore than 50 % of the shares. Personnel from companies in whichIndaver has a minority shareholding are not included in the figures.61 people are employed in the Central and Eastern Europeanregion,103 in Ireland, and 6 in Portugal.Indaver attaches great importance to staff training. The company isconvinced that providing ongoing training for its employeesenhances its strength, flexibility and performance. Due to fiercecompetition and the globalisation of the waste market, companiessuch as Indaver have to be able to respond to changes more flexibly,more creatively and at an ever-faster pace. Indaver thereforeconsiders good human resources to be the key to the success ofthe organisation.Consequently, a well developed HR policy is crucially important. Itmust be in a position to react to internal and external challengeswith innovation and flexibility. It must make it possible to recruitand retain talented staff. Indaver constantly strives to ensure apleasant working environment where the opportunities, ambitionsand wishes of every member of staff correspond as closely as possibleto the needs and requirements of the company.Indaver’s training programme not only increases the functionalknowledge and skill of staff, but also offers them opportunities fordevelopment to broaden their careers. Training data is registeredsystematically in the Benelux region. The entire Indaver Group willeventually use the same system. The average number of days’training in the Benelux region stood at 3.74 days per person in2006.Major focus on safety:PPW index at group levelSafety is Indaver’s absolute top priority. The company considersthat is has an important moral responsibility to ensure the safetyof internal and external employees and people living in the vicinityof its treatment sites as a matter of priority. With this in mind,safety procedures are stringently integrated into every aspect ofwaste management.Indaver’s safety policy is based on three guiding principles:■ staff training;■ safety monitoring;■ increasing staff awareness.All new employees receive the necessary safety training courses.Refresher courses and ongoing training ensure safe and responsiblebehaviour at all times. Sub-contractors’ staff or people whoenter the treatment sites on a single occasion attend an informationsession on Indaver’s safety policy. They are given the necessaryinstructions on the compulsory and correct use of personal protectiveequipment.

30Corporate social responsibilityThe ‘code of ethics’ and the‘codes of good practice’Monitoring safety is vitally important. Indaver ensures that personalprotective equipment is used properly and consistently and thatthe many safety instructions are applied. In its awareness-raisingcampaigns, the company always highlights the importance of safetyand prevention at the workplace. Indaver sets stringent safetyobjectives every year in order to constantly improve its safety performance.Indaver uses the PPW index (Prevention and Protection at theWorkplace) to monitor its performance in terms of safety. The PPWindex is a detailed safety performance indicator. It is used to monitornot only accidents that result on lost working time, but alsothose involving internal or external first aid and apparent or nearaccidents. This index takes account of both company staff and subcontractorsand all 'others', such as visitors.The Benelux region has been using this system to monitor safetyperformance since 1991. The PPW index is a weighted average ofthe number of accidents, whereby the type of accident (apparent,requiring first aid or involving lost working time) determines theweight assigned in the formula. In other words: the more seriousthe consequences of the accident, the heavier the accident willweigh and the greater the impact on the index calculation will be.Indaver attaches great importance to acting ethically in all its activities.Indaver employees are expected to behave in accordancewith high moral and ethical standards towards all their professionalcontacts, including customers, people living in the neighbourhoodof the plants, suppliers, colleagues, etc.These standards have been laid down in a corporate charter, theIndaver Code of Ethics. As regards customer relations, this codestates, for example, that customer information should be keptsecret at all times and that no customer should be given subjectivepreferential treatment. As regards relations with colleagues, thecorporate charter states that all Indaver employees should demonstratemutual respect for the integrity and privacy of their colleagues.In addition to this code of ethics, Indaver also applies an operationalcode of good practice, summarised in ’10 codes of goodpractices’. These set out the methods and techniques Indaver usesfor the sustainable treatment of all waste materials. The basictenets of these codes are as follows:■ Indaver will adhere to the principles of sustainable development.■ Indaver will respect and abide by the principles of ‘good corporategovernance’ and ‘duty of care’.■ Indaver will take all the necessary measures to minimise theimpact of its operations on the environment and on the peopleliving in the neighbourhood of its plants.This code is also applicable to all the companies in which Indaverhas a majority shareholding.A summary of code of ethics and the codes of good practice canbe found on the website www.indaver.com.1614121086420History PPW index - Indaver Benelux Region2001 2002 2003 2004 2005 2006Indaver employeesWorkers fromcontractor firms1614121086420History PPW index - CEE Region + Ireland2001 2002 2003 2004 2005 2006CEE Region + Ireland

Annual report 2006 31Internal environmental protection,quality- and safety-related systemsIndaver opts resolutely in favour of integrated and sustainablewaste management. Attention focuses constantly on safety, quality,care of the environment and openness. Indaver uses the EFQMmodel as a framework to continually enhance its performance. Thisbusiness model, which was developed by the European Foundationfor Quality Management, provides a good tool to determine a company’sfuture objectives. It helps organisations to continuouslyimprove their results – both their financial results and their resultsin the fields of HR management, customer satisfaction and theenvironment.External certificationIndaver strives to obtain ISO 9001 and ISO 14001 certificates forall sites. Certification by an independent and accredited certificationbody provides officially confirmation of the proper working ofthe existing management systems by an independent third party.In addition, the certification and the accompanying audits are agood means of self-assessment and an incentive to furtherimprove the quality of the services provided and the results interms of the environment.Focus on the impact of ouroperations on the environmentIndaver attaches particular importance to the environment andstrives to minimise the impact of its operations on the surroundings.All its treatment plants have been designed using the BestAvailable Techniques. This guarantees the environmentally responsibletreatment of all waste flows and constant improvement in thecompany’s environmental performance.Open communicationIndaver is open to permanent dialogue with its staff, people livingin the vicinity of its plants, its customers, the authorities, industry,the scientific world and the press.The company maintains careful relations with all these groups, distributesinformation about its activities and responds to any questionsraised. In its annual environmental and sustainability reports,Indaver provides a clear and transparent account of its operationsand its environmental performance. For more information, pleasevisit Indaver’s websites: www.indaver.be and www.indaver.com.Indaver - Belgium ISO 9001 1991ISO 14001 1997VCA 2003Indaver Relight - Belgium ISO 9001 1999ISO 14001 1999AROC Ijmuiden - The Nederlands ISO 9001 2002ISO 14001 2004Indaver Ireland - Ireland ISO 9001 1994ISO 14001 2000OHSAS 18001 2002Spovo - Czech Republic ISO 9001 2003ISO 14001 2003OHSAS 18001 2004Intereko - Poland ISO 14001 2005

7FinancialInformation

Annual report 2006 33General commentsFollowing the switchover as of 2005 onwards from Belgian GAAPto IFRS (International Financial Reporting Standards) for reportingand publishing the consolidated results, the new valuation principlesand bases have been remained unchanged for the 2006 financialand calendar year.When interpreting the consolidated results for 2006, the followingmajor changes should be taken into account.Sale of operational activities in SwitzerlandAt the end of 2005, given the plans to sell the activities inSwitzerland, the assets and liabilities of these participations wererecorded separately under the assets and liabilities held for sale. Inthe profit/loss after taxes, their results were recorded separatelyfrom the continuing operating activities being continued, as requiredin IFRS.During the course of 2006, all operational activities in Switzerlandwere actually and virtually entirely sold.All the subsidiaries of Indaver Schweiz were sold with the exceptionof SIBAG. 75 % of our 98.5 % holding in this company hasnow been sold, but 25 % has been retained. Indaver has a putoption on these 25 % but a call option has also been granted, andboth options can be exercised in the first quarter of 2009.In the context of the sale of the entire holding in Amstutz, includingthe subsidiary Schmucki, the real estate belonging to Amstutzhas been taken over by Indaver Schweiz. This involves the sites inObfelden with an office building and an industrial building, whichhave been hired out to the party taking over the operating activitiesfor one and five years respectively.In this way, as at the end of 2006 Indaver retained only thecompany Indaver Schweiz with the real estate referred to above, a24.6 % holding in SIBAG.For the first half of 2006, all Swiss activities were still included inthe consolidated profit and loss account. For the second six-monthperiod, only Indaver Schweiz was included, in its reduced form asindicated above. The full impact of the disinvestments carried outin Switzerland were included in the profit and loss account withthe exception of the upward value adjustment of the holding retainedin SIBAG which has temporarily been included solely in thecapital and reserves and will only be included in the profit and lossaccount as well once it has actually been effected.Sale of other holdingsDuring the course of the second half of the year, our 50 % holdingin Apparec was also sold to the joint shareholder of VanGansewinkel, while our limited holding of 1.35 % in Revatech wassold to the joint shareholders. In both cases, this resulted in a capitalgain which was recorded under the heading ‘gain/loss from thedisposal of non-current assets’.The establishment of Indaver Portugal at the end of 2006 will onlyhave a relevant impact on the figures as of 2007.Inclusion of SVEX in the consolidationWhen comparing the 2006 figures with those for 2005 accountshould also be taken of the establishment of SVEX in late 2005.This company mainly takes care of the operation and maintenanceof the grate incinerators of Indaver NV and the new fluidised-bedincinerators of SLECO NV on the same site, including the optimisationof full utilisation for energy purposes on the Beveren site.As at the end of 2005, SVEX was still included under the ‘othernon-current financial assets' with our share of EUR 31 thousand inthe formation expenses of EUR 62 thousand. SVEX was only includedin the consolidation as a 50 % joint venture with Sita from2006 onwards.All this logically has a major impact on the comparability of thefigures for 2006 with those of 2005, as will be indicated in therelevant comments.

34Financiële informatieComments on the profit and loss accountIn 2006, the Indaver Group recorded total operating income ofEUR 233.5 million, an increase of EUR 23.6 million or 11.3% comparedwith the total operating income of EUR 209.8 million recordedin 2005.The further fall in the sale of goods by EUR 10 million, from EUR28.6 million in 2005 to EUR 18.6 million in 2006, can be virtuallyentirely attributed to the ‘deconsolidation of Vlar Papier’ as of thesecond half of 2005. During the first six months of 2005, VLARPapier still accounted for a contribution in excess of EUR 8 million,whereas this was entirely omitted in 2006.The sale of Apparec, which was no longer included in the results asof 1 July 2006, also accounted for an additional reduction ofapproximately EUR 1 million.By far the largest element in the consolidated operating income isthe turnover for services provided. In this field, income rose againfrom EUR 174.8 million in 2005 to EUR 201.2 million in 2006, upEUR 26.4 million or 15.1%. This increase can be attributed primarilyto the start-up of SLECO’s new fluidised-bed incinerators andthe further increase in volumes under contract although in 2006,given that SLECO was in a start-up phase, these still had to be largelyabsorbed by means of external processing solutions.A sharp increase in turnover was also recorded in Ireland, withrising sales of own group plants but also third-part plants.These factors, amongst others, mean that the loss in turnover resultingfrom the divestments in Switzerland and Apparec, estimatedat approximately EUR 9 million for the second half of 2006, wasamply offset by new turnover.The further increase in the other operating income from EUR 6.3million in 2005 to EUR 13.6 million in 2006 is partly the result ofvarious damages from Lurgi in the context of the delays accumulatedin the delivery of new fluidised-bed incinerators to Sleco,already billed on and received, and the additional costs accumulatedin the months before delivery.The compensation anticipated further to the serious but reparabledamage detected in these new plants in late October 2006 hasalso already been included for the material damage and increasedcosts incurred. Both the insurers concerned and the main contractorhave already been approached in this context. Again in thiscontext, however, a sufficiently cautious approach has been adoptedin that for the time being, no account has been taken of anycompensation for the substantial operating losses already incurredin 2006 as a result of this damage.All this has not prevented an increase in this other operating incomein structural terms as well, mainly as a result of the arrangementsmade with SLECO and SVEX to obtain a whole range ofservices for these companies from Indaver, including in the field ofproject management, general infrastructure, HR, QESH,Communication and IT.Through-billing of management fees and various services providedfor minority holdings, joint ventures or third parties therefore continuesto constitute a major share of this other operating income.The sharp increase in operating income went hand in hand with aclear rise in total operating costs from EUR 197 million in 2005 toEUR 217.9 million in 2006, up by EUR 20.9 million or 10.6 %.The costs for raw materials and consumables remained virtuallyunchanged. The additional costs resulting from the start-up of thenew fluidised-bed incinerators at Sleco were offset by the fact thatthe costs for raw materials and consumables for the grate incineratorsat Indaver nv were charged to SVEX as of 1 January 2006,which means that as of 2006 only half these costs have been includedin the consolidated figures of Indaver and by the deconsolidationof VLAR Papier from the second half of 2005.The main cost increases (by EUR 20.7 million) in 2006 were recordedin costs for services, which rose from EUR 84.6 million in 2005to EUR 105.2 million in 2006. The start-up of the new fluidisedbedincinerators referred to above, with the increased trading turnoverand costs for related processing and transport in the Beneluxand Ireland are the main causes of this.In terms of costs, they also amply offset the fall recorded further tothe divestments relating to VLAR Papier (2005) and Switzerlandand Apparec (in 2006).Personnel costs fell slightly in 2006 from EUR 44.8 million in 2005to EUR 43.6 million in 2006, down 2.7 %. Here too, the reductionwas mainly attributable to the divestments undertaken and thetransfer of a considerable number of staff from Indaver nv (100 %)to SVEX (50 %) early in 2006. However, the actual growth andfurther growth plans in other areas resulted in higher staff numbersand costs.Depreciation and amortisation increased in 2006, rising fromEUR 20 million in 2005 to EUR 25.2 million in 2006, an increaseof EUR 5.2 million or 26 %. The reduced depreciation resultingfrom the divestments undertaken was more than offset by theadditional depreciation at Sleco and on the other investments inexpansion made within the group.Whereas in 2005 impairment losses led to a loss of EUR 1.6 millionrecorded in the results, the net result of impairment losses andreversals of earlier impairment losses produced a bonus of EUR 0.1million for 2006.

Annual report 2006 35Finally, other operating costs fell in 2006, down from EUR 26.2million in 2005 to EUR 24.6 million in 2006, a reduction of 6.3 %.The sharp increase in environmental levies resulting from the startupof the fluidised-bed incinerators was more than offset by areversal of provisions for possible sanitation obligations or impairementlosses on the assets in Switzerland.The increase in total operating income of EUR 23.7 million and intotal operating costs of EUR 20.9 million resulted in an operatingprofit (EBIT) for 2006 of EUR 15.6 million, EUR 2.7 million or21 % higher than in 2005.In terms of the total operating income, the EBIT margin thereforerose further from 6.1 % in 2005 to 6.7 % in 2006, despite the highertrading turnover.Just as in 2005, for 2006 a substantial bonus (EUR 2.3 millioncompared with EUR 2.4 million) was recorded on the sale of noncurrentassets. Whereas in 2005 this primarily involved the sale ofIndaver’s majority holding in Vlar Papier, in 2006 capital gains wererecorded mainly on the sale of the Swiss activities and Apparec.In 2006 financial income rose by EUR 0.2 million to EUR 2.6 million.However, financial costs rose far more sharply: from EUR 3.6million in 2005 to EUR 9.3 million in 2006, an increase of EUR 5.7million.In addition to the waiver of a debt of EUR 2.9 million on outstandingloans with Amstutz, effected in the context of the sale, therewas the planned increase in the financing charges upon the completionand start-up of new fluidised-bed incinerators at SLECOwhich were no longer included in the assets in 2006 as depreciationof these new plants had already begun when they came online at the end of 2005.This meant that in net terms, a negative financial result of EUR 6.7million was recorded in 2006 compared with the net cost of EUR1.2 million recorded for 2005, a difference of EUR 5.5. million.After the exceptionally high result of EUR 7.2 million recorded in2005 as the group share in the profits or losses of shareholdingsaccounted for using the equity method, the net contribution ofthese holdings fell to EUR 6 million in 2006, down EUR 1.2 millionor 16 %. However, this is far higher than was expected after anexceptional year in 2005 and may be attributed chiefly to goodresults from the intermunicipal partnerships (ECOV/IVAGO, IBO-GEM and, not least, Hooge Maey) and the results recorded by ourholdings in Sita Decontamination and GRL.Partly due to this, the group profit before taxes for 2006 neverthelessamounted to EUR 17.3 million, down EUR 4 million or 19 %compared with the figure of EUR 21.3 million recorded in 2005.As regards corporate taxation, Indaver continues to suffer the consequencesof the rising environmental levies which, since 2003,have to be considered non-deductible cost items. AlthoughIndaver clearly contributes to the connection of these environmentaltaxes - amounting in total to over EUR 8.4 million in 2006 - onbehalf of the Flemish authorities, the federal authorities apply corporatetax to the full amount passed on to the customer and theamounts transferred to the authorities have to be considered entirelynon-deductible costs. Independent of all profitability, Indavertherefore pays additional taxes of 34 % or almost EUR 2.9 million,even though essentially the group is already answerable for thecollection of this environmental tax and its pre-financing. Wherethis is passed on to the customers, it is again, irrevocably, subjectto corporate taxes.Indaver continues to deplore this situation and denounce it asparticularly unfair.In addition, Indaver is further penalised in terms of its competitiveposition, as many other service providers both in Belgium andabroad are not subject to these taxes, or not to the same extent.This inevitably means that the final tax assessment of EUR 5.8 millionremains extremely high, despite relevant and tax-free gainsand substantial dividend income which Indaver can collect withlimited additional taxation once they have been taxed in full at thecompanies concerned thanks to the DBI status.Moreover, this high tax assessment was partly due to the fact thatin 2006, the taxable profits were recorded in Indaver nv and othergroup holdings where they were taxed in full, while no tax couldbe reclaimed in view of losses in other companies in the group(including SLECO nv).In line with the lower profit before taxation, however, the taxassessment was eventually EUR 1 million lower than the exceptionallyhigh figure of EUR 6.7 million for 2005.The profit or loss from operating activities that are discontinued isrecognised separately under certain conditions in IFRS.Whereas for2005 this only applied to the planned disinvestments in the Swissactivities, as at the end of 2006 this still included the results recordedby these Swiss activities during the first half of 2006 and thenegative result for 2006 for ORINSO, the divestment of which wasplanned for the end of 2006.While the planned divestments in 2005 accounted for a loss ofEUR 2.1 million, for 2006 a limited profit of EUR 0.1 million wasrecorded in net terms for 2006, an improvement of EUR 2.2 million.

36Financiële informatieComments on the balance sheetConsequently, the consolidated profit after tax in 2006 amounts toEUR 11.5 million, EUR 3 million or 21 % lower than the EUR 14.5million recorded as net profit in 2005.The share attributable to minority interests remained limited onceagain in 2006 and following the divestments in Switzerland thiseven fell below EUR 25 thousand, which means that the groupshare of the net profit for 2006 also amounts to EUR 11.5 million.When compared with equity of EUR 114.6 million at the start ofthe 2005 financial year, this net profit of EUR 11.5 million for 2006yields a return on equity of 10 %, down on the figure of 14.5 %recorded in 2005.As indicated above, however, this may be attributed entirely to theincreased depreciation charges and financing charges for the newfluidised-bed incinerators at SLECO which could not be fully absorbedby additional income in this start-up year.The expectation is that this should be the case as of 2007, so thatthe net return on equity should rise again in the near future.Indaver was able to consolidate its results at a high level in 2006despite the start-up situation at Sleco and the other efforts andinvestments in project development and growth which will only beconverted into actual profits and a contribution to the group'sresults in the years to come.The 2006 financial year closed with a consolidated balance sheettotal of EUR 410.2 million, which is EUR 25 million or 6.5 % up onyear-end 2005.As regards the assets, a clear rise in non-current assets in particularmay be observed, up EUR 28.8 million or 9.7 %.As regards property, plant and equipment, the increase amounts toEUR 9.8 or 4.2 %, despite the high levels of depreciation and thedivestment relating to Apparec. The further investments in SLECOand in Ireland are the main causes of this increase.Retaining real estate in Switzerland without keeping the relatedoperating activities prompted us to separate this asset under realestateinvestments for the sum of EUR 3.2 million.Depreciation and amortisation on intangible assets was higherduring 2006 than the additional investments, which means thatthe book value fell by a further EUR 2.4 million to EUR 20.1 million.The book value of the holdings consolidated using the equitymethod remained almost unchanged at EUR 19.2 million.The sharp rise of EUR 17.4 in other non-current financial assetscan be attributed almost entirely to the further increase in thefinancing of the SLECO project by both shareholders. The structuralportion of this financing by Indaver that is not eliminated fromthe consolidation is included here and rose from EUR 20.3 millionas at the end of 2005 to EUR 37.2 million as at the end of 2006.Current assets fell by EUR 3.8 million to 83.4 million as at the endof 2006.The sharp fall from EUR 18.7 million at the end of 2005 to barelyEUR 0.8 million at the end of 2006 is due primarily to the divestmentsin Switzerland, which were already recorded separatelyunder assets held for sale as at the end of 2005.However, a substantial increase was recorded in current tradereceivables (+ EUR 12.6 million) and other receivables (+ EUR2.1), which together accounted for a rise from EUR 45.5 million asat the end of 2005 to EUR 60.2 million as at the end of 2006, up32 %.

38Financiële informatieInvestments and EBITDAIn 2006 the group’s activities generated an EBITA of EUR 32.5 million,compared with EUR 33 million for 2005 (EBIT + impairmentlosses and depreciation + provisions - capacity rights paid inadvance).The EBITDA therefore remains high, even though the EBITDA marginfell from 15.7 % in 2005, partly due to the higher total operatingincome, to 13.9 % in 2006.This is mainly attributable to the divestments effected, togetherwith the more limited contributions to EBITDA made by SLECO inits start-up year and the higher trading turnover.The expected increase in the turnover and EBITDA from SLECO in2007 and 2008, which should also make it possible to processgreater volumes in the company’s own facilities, will correct thissituation.In 2006, the Indaver Group continued to invest heavily in its nationaland international expansion and in its existing operations.With the completion and start-up of the SLECO project in Doel, in2006 Indaver, in conjunction with Sita, started up and brought tothe market its biggest investment ever.Following the initial losses resulting from this project up to andincluding 2006, as of 2007 this is expected to make a major contributionto the further increase in Indaver’s operating income,EBITDA and net profit.External financingOnce again in 2006, the Indaver Group was able to finance its highlevel of ongoing capital investments out of its own cash flows.This is reflected in the fact that the entire financing of the SLECOproject, an investment of over EUR 180 million, 50 % of which isbeing borne by Indaver, has over the past three years gone hand inhand with a reduction in Indaver’s interest-bearing debt.Despite maintaining an exceptionally high level of investments, theincrease in total liabilities remained limited once again in 2006, atEUR 12.7 million.Moreover, the total debts amounting to EUR 283 million as at theend of 2006 include EUR 91 million in amounts paid in advanceand substantial other liabilities that do not yield interest.With a net interest-bearing debt of barely EUR 58.1 million as atthe end of 2006 and the long service life of its main plants, it maybe expected that Indaver still has development potential in theyears to come, without the need for capital increases.A new long-term loan of EUR 30 million taken out on 1 March2006 for the further financing of the SLECO project resulted in anincrease in long-term interest-bearing debts with banks in 2006,with an equivalent reduction in short-term debts.The interest rate for this project had already been hedged earlierand the impact of this interest-rate swap on the figures as at 31December 2006 was revalued and included in the balance sheetand the profit and loss account for 2006.As a result, Indaver’s liquidity situation has also improved,although the high level of short-term financing, maintained foryears, was perfectly justifiable given the high cash flow and lowinterest rates.

Annual report 2006 39Risk managementIndaver tries to continually assess and manage the main risks of orcaused by its operations.Whenever possible, risks are eliminated orminimised.In addition, the group tries, whenever possible and relevant, tohedge against risks on acceptable terms.Good insurance policies from renowned insurance companies areimportant here, both to cover Indaver’s own damage risks and itsliability risks. For the major treatment plants, where an incidentcould inevitably impact considerably on the company’s overallresults, Indaver also takes out corporate business interruption insurance.Opportunities for growthEquity is increasing due to the strong profitability and the reservationof profit within the company, clearly underpinning the group’sfurther growth and development. The necessary replacementinvestments still remain far lower than the cash flows generated.On the basis of the current financial structure and given the highcash flows and attractive profit level, Indaver has considerablefinancial power and stability: constituting an excellent basis forfurther growth.Nevertheless, Indaver has now attained a sufficient size to be ableto cover many risks itself more efficiently. From the moment whenrelevant risks have been identified with a real chance of occurrence,the necessary provisions are charged to the result.Share capital, total equityand shareholder structureIndaver’s share capital remained unchanged in 2006 and totalsEUR 87.4 million. The changes in the shareholding body are sufficientlyexplained elsewhere in this report.Auditor’s report and the filingof the consolidated accountsTogether with the annual report from the board of directors,the complete consolidated accounts were filed at theCentral Bank of Belgium after the Annual GeneralMeeting, in accordance with the statutory regulations ofpublication.The external auditor approved the consolidated financialstatements without any reservations.

40Financial InformationBALANCE SHEET AFTER APPROPRIATIONASSETSEUREURPeriodPeriod31-12-0631-12-05I. NON-CURRENT ASSETS 326,789,814.85 298,021,133.87Property, plant and equipment 242,714,982.40 232,958,725.33Construction in progress 8,928,482.95 6,114,978.41Land and buildings 41,717,966.27 24,326,914.56Plant, machinery and equipment 186,671,858.46 196,699,857.01Furniture, office equipment and vehicles 5,391,313.91 5,506,056.84Leasehold improvements 0.00 0.00Other property, plant and equipment 5,360.81 310,918.51Investment property 3,235,726.64 0.00Intangible assets 20,149,246.41 22,563,035.09Goodwill 14,948,125.70 16,412,010.70Other intangible assets 5,201,120.71 6,151,024.39Investments accounted for using the equity method 19,158,141.88 19,252,876.87Deferred tax assets 681,195.10 683,574.44Other non-current financial assets 39,902,059.55 22,467,114.73Shares 2,667,312.85 2,068,681.69Securities other than shares 0.00 0.00Loans 37,234,746.70 20,398,433.04Loans in related parties 37,234,746.70 20,348,433.04Other loans 0.00 50,000.00Other financial assets 0.00 0.00Non-current hedging instruments 0.00 0.00Non-current trade and other receivables 948,462.87 95,807.41Cash restricted or pledged 0.00 0.00Post-employment benefit surplus 0.00 0.00Other non-current trade and other receivables 948,462.87 95,807.41Non-current deferred charges 0.00 0.00

Annual Report 2006 41EURPeriod31-12-06EURPeriod31-12-05II. CURRENT ASSETS 83,376,150.38 87,135,008.86Assets held for sale 831,308.46 18,707,381.79Inventories 4,288,579.43 4,091,124.85Other current financial assets 9,599,413.43 10,746,487.62Shares 0.00 0.00Securities other than shares 0.00 0.00Loans 9,599,413.43 10,746,487.62Loans in related parties 9,599,413.43 10,721,487.62Other loans 0.00 25,000.00Other financial assets 0.00 0.00Current hedging instruments 0.00 0.00Current tax receivables 160,923.56 73,877.33Current trade and other receivables 60,235,956.76 45,518,346.63Trade receivables 54,994,761.91 42,391,008.63Other receivables and other assets 5,241,194.85 3,127,338.00Interest to be received (accrued income) 639,013.44 179,743.44Dividends to be received 0.00 0.00Other accrued income 15,549.78 2,000.65Other receivables and other assets 4,586,631.63 2,945,593.91Current deferred charges 2,589,133.78 821,643.14Cash and cash equivalents 5,670,834.96 7,176,147.50TOTAL ASSETS 410,165,965.23 385,156,142.73

42Financial InformationLIABILITIES AND EQUITYEQUITYEUREURPeriodPeriod31-12-0631-12-05I. TOTAL EQUITY 126,903,074.61 114,613,751.65A. Equity attributable to equity holders of the parent company 126,896,203.33 113,780,111.21Issued capital 87,352,745.05 87,352,745.05Share capital 87,352,745.05 87,352,745.05Reserves 241.728,88 -1,432,425.72Translation reserves -587,467.13 -346,884.94Revaluation to fair value 829,196.01 -1,085,540.78Treasury shares ( - ) -318,184.60 -318,184.60Retained earnings (accumulated losses) 39,619,914.00 28,177,976.48Profit (loss) for the period 11,484,216.66 14,422,294.97Other retained earnings (accumulated losses) 28,135,697.34 13,755,681.51B. Minority interest 6,871.28 833,640.44

Annual Report 2006 43LIABILITIESEUREURPeriodPeriod31-12-0631-12-05II. LIABILITIES 283,262,890.62 270,542,391.08A. Non-current liabilities 172,392,470.57 143,197,302.61Non-current interest bearing borrowings 61,088,420.61 26,381,436.06Bank borrowings 31,824,160.38 8,211,370.46Finance leases 14,260.23 7,565.60Bank overdrafts 0.00 0.00Other borrowings 29,250,000.00 18,162,500.00Loans from related parties 0.00 0.00Other borrowings 29,250,000.00 18,162,500.00Non current deferred income 79,573,115.94 83,726,305.95Government grants 1,739,785.41 1,946,599.75Other non current deferred income 77,833,330.53 81,779,706.20Non current provisions 18,249,610.93 20,095,856.49Non current post employment benefit obligation 9,210,544.17 8,986,358.55Non current hedging instruments 1,046,423.00 3,114,411.00Deferred tax liabilities 3,222,378.37 761,350.88Non-current trade and other payables 1,977.55 131,583.68B. Current liabilities 110,870,420.05 127,345,088.47Liabilities held for sale 989,060.82 9,088,168.22Current interest bearing borrowings 49,579,210.43 53,325,404.66Bank borrowings 35,227,724.97 42,135,585.77Finance leases 9,935.07 9,819.10Bank overdrafts 0.00 225,539.00Other borrowings 14,341,550.39 10,954,460.79Loans from related parties 184,635.39 209,630.79Other borrowings 14,156,915.00 10,744,830.00Current deferred income 11,376,164.90 10,725,444.91Government grants 206,814.18 207,933.43Other current deferred income 11,169,350.72 10,517,511.48Current provisions 2,023,938.74 1,330,405.35Current post-employment benefit obligation 11,499.00 0.00Current hedging instruments 432,572.00 1,017,042.00Current tax payables 6,242,640.45 9,351,260.92Current trade and other payables 40,215,333.71 42,507,362.41Trade payables 30,265,376.01 29,421,839.64Advances received 14,114.74 2,255,592.50Other payables and other liabilities 9,935,842.96 10,829,930.27Interest to be paid (accrued charges) 976,855.10 329,733.82Other accrued charges 1,116,977.05 991,997.67Other payables and other liabilities 7,842,010.81 9,508,198.78TOTAL EQUITY AND LIABILITIES 410,165,965.23 385,156,142.73

44Financial InformationINCOME STATEMENT BY NATUREEUREURPeriodPeriod31-12-0631-12-05Operating revenue 233,498,433.01 209,843,888.98Sale of goods 18,631,593.68 28,588,780.90Services provided 201,215,423.96 174,839,982.83Property rental income 75,714.47 101,146.78Other operating revenue 13,575,700.90 6,313,978.47Operating expenses ( - ) -217,941,204.20 -197,033,952.48Cost of materials and services ( - ) -124,854,984.82 -104,439,799.37Materials and consumables ( - ) -19,613,370.93 -19,881,385.98Services (-) -105,241,613.89 -84,558,413.39Changes in inventories of finished goods and work in progress ( - ) 184,206.04 46,456.07Employee expenses ( - ) -43,609,912.14 -44,801,222.69Wage and salaries ( - ) -28,922,187.74 -30,999,647.75Social security expenses ( - ) -7,371,509.47 -7,497,384.65Post-employment benefit charges ( - ) -3,900,868.57 -3,104,415.87Other extra-legal insurances ( - ) -236,109.13 -283,036.92Other personnel expenses ( - ) -3,179,237.23 -2,916,737.50Depreciation and amortisation ( - ) -25,225,090.83 -20,034,859.25Depreciation ( - ) on tangible assets -23,353,902.40 -18,536,630.69Write-down of inventories to net realisable value ( - ) -46,096.48 -127,578.20Amortisation ( - ) on intangible assets -1,825,091.95 -1,370,650.36Impairment losses, net 138,771.60 -1,567,150.10Impairment losses from property, plant and equipment, net 0.00 -1,449,792.06Impairment losses from intangible assets, net (except goodwill) 0.00 0.00Impairment losses from goodwill 0.00 0.00Impairment losses from bad and doubtful commercial debts, net 142,943.02 -117,358.04Impairment losses from other assets, net -4,171.42 0.00Research and development (by nature) 0.00 0.00Restructuring costs (by nature) 0.00 0.00Other operating expenses (by nature) ( - ) -24,574,194.05 -26,237,377.14Work performed by the enterprise and capitalised 0.00 0.00Profit (loss) from operations 15,557,228.81 12,809,936.50

Annual Report 2006 45EURPeriod31-12-06EURPeriod31-12-05Gain (loss) on financial instruments designated as cash flow hedges 0.00 0.00Gain (loss) from derecognition of financial assets available for sale 0.00 0.00Gain (loss) from the disposal of non-current assets 2,332,181.07 2,439,330.93Gain (loss) from the disposal of non-current assets, other than financial -12,132.68 180,064.47Gain (loss) from the disposal of non-current financial assets 2,344,313.75 2,259,266.46Gain (loss) from the disposal of subsidiaries, associated holdings 2,102,679.09 2,259,266.46and joint venturesGain (loss) from the disposal of other non-current financial assets 241,634.66 0.00Finance income 2,629,417.43 2,416,749.16Interest income 2,385,672.10 2,161,144.63Dividend income 5,111.00 8,339.00Other 238,634.33 247,265.53Finance costs ( - ) -9,342,532.83 -3,614,966.38Interest expenses and charges on debts -5,751,234.00 -3,127,005.66Interest expenses -5,427,599.88 -2,961,314.07Charges on debts -323,634.12 -165,691.59Discounting charges on provisions -663,385.60 -487,960.72Impairment losses from financial assets, net -2,927,913.23 0.00Other 0.00 0.00Share of profit (loss) from equity accounted investments 6,036,642.36 7,206,898.20Other non-operating income 46,622.90 0.00Negative goodwill included in profit or loss 46,622.90 0.00Profit (loss) before tax 17,259,559.74 21,257,948.41Income tax expense ( - ) -5,750,629.46 -6,740,605.49Post-tax profit (loss) from continuing operations 11,367,648.73 16,605,779.73Post-tax profit (loss) on discontinued operations 141,281.55 -2,088,436.81Profit (loss) for the period 11,508,930.28 14,517,342.92Attributable to minority interests 24,713.62 96,534.47Attributable to equity holders of the parent company 11,484,216.66 14,420,808.45EURPeriod31-12-06EURPeriod31-12-05I. EARNINGS PER SHAREBasic earnings (losses) per shareExcluding profit (loss) from discontinued operations 5.94 8.69Including profit (loss) from discontinued operations 6.00 7.54Basic earnings (losses) per shareExcluding profit (loss) from discontinued operations 5.94 8.69Including profit (loss) from discontinued operations 6.00 7.54

46Useful addressesBELGIUMINDAVER nvregistered officePoldervlietweg 5, Haven 550BE-2030 ANTWERPEN 3t + 32 3 568 49 11f + 32 3 568 49 99INDAVER saRue de l’Industrie 20BE-1400 NIVELLESt + 32 67 88 36 52f + 32 67 88 36 53INDAVER nvMolenweg, Haven 1940BE-9130 DOEL (BEVEREN)t + 32 3 570 72 11f + 32 3 570 72 99INDAVER MILIEUPARKBoomsesteenweg 199BE-2830 WILLEBROEKt + 32 3 860 73 00f + 32 3 866 38 03INDAVER nvMolenweg 3, Haven 1944BE-9130 KALLO (BEVEREN)t + 32 3 570 94 00f + 32 3 575 18 46INDAVER nvWestvaartdijk 111BE-1850 GRIMBERGENt + 32 2 253 11 07f + 32 2 253 05 01Indaver nvheadquartersDijle 17 aBE-2800 MECHELENBELGIUMt + 32 15 28 80 00f + 32 15 28 80 50www.indaver.bewww.indaver.comBELGIAN SUBSIDIARIESINDAVER LOGISTICS nvBoomsesteenweg 199BE-2830 WILLEBROEKt + 32 3 860 73 28f + 32 3 860 73 29INDAVER PARTICIPATIES nvMolenweg 3, Haven 1944BE-9130 KALLO (BEVEREN)t + 32 3 570 94 00f + 32 3 575 18 46SLECO-CENTRALE nvMolenweg, Haven 1940BE-9130 DOEL (BEVEREN)t + 32 3 570 72 60f + 32 3 570 72 69SVEX nvMolenweg, Haven 1940BE-9130 DOEL (BEVEREN)t + 32 3 570 72 11f + 32 3 570 72 99SPANIN nvIngelmunstersteenweg 229BE-8780 OOSTROZEBEKEt + 32 56 67 47 86f + 32 56 67 47 68RECYGOM nvRue Zénobe Gramme,Zoning ‘Les Plénesses’BE-4821 DISON (ANDRIMONT)t + 32 87 35 03 00f + 32 87 35 03 33INDAVER RELIGHT nvMolenweg, Haven 1940BE-9130 DOEL (BEVEREN)t + 32 3 570 73 52f + 32 3 575 18 46WIPS nvDagmoedstraat 105BE-9506 GERAARDSBERGENt + 32 54 43 76 76f + 32 54 43 76 74VLAR PAPIER nvOude Spoorbaan 15-17BE-2830 TISSELTt + 32 3 860 93 20f + 32 3 886 61 22VLAR PAPIER nvWondelgemkaai 200BE-9000 GENTt + 32 9 258 21 41f + 32 9 258 21 42GRL Glasrecycling nvDellestraat 10BE-3560 LUMMENt + 32 13 53 06 60f + 32 13 53 06 69SITA Decontamination nvWestvaartdijk 97BE-1850 GRIMBERGENt + 32 2 756 55 50f + 32 2 251 90 87

Annual report 2006 47PUBLIC - PRIVATE PARTNERSHIPSIVAGO cvbaProeftuinstraat 43BE-9000 GENTt + 32 9 240 81 11f + 32 9 240 81 99IVVO cvbaBargiestraat 6BE-8900 IEPERt + 32 57 23 08 80f + 32 57 23 08 90IVIO cvbaLodewijk De Raetlaan 12BE-8870 IZEGEMt + 32 51 31 17 96f + 32 51 31 67 39INTERCOMMUNALEVERENIGING HOOGEMAEY cvbaHaven 550, Moerstraat 99BE-2030 ANTWERPENt + 32 3 568 32 68f + 32 3 568 32 69IBOGEM cvbaSchaarbeekstraat 27BE-9120 MELSELE (BEVEREN)t + 32 3 253 16 64f + 32 3 253 01 15VERKO nvBevrijdingslaan 201BE-9200 DENDERMONDEt + 32 52 21 39 95f + 32 52 20 01 42SUBSIDIARIES AND PARTNERSHIPS ABROADINDAVER IRELAND Ltd4, Haddington TerraceDun LaoghaireIE- CO. DUBLINIRELANDt + 353 1 214 58 30f + 353 1 280 78 65INDAVER UK ltd.2 Crane CourtFleet StreetEC4A 2BL LONDONUNITED KINGDOMt + 353 1 214 58 30f + 353 1 280 78 65INDAVER SCHWEIZ AGTWS ConfidesGeschäftshaus ZentrumHauptstrasse 67, Postfach 237CH-8274 TägerwilenSWITZERLANDt + 41 71 666 65 20f + 41 71 666 65 21AROC-NL b.v.Postbus 10000NL-1970 CA IjmuidenTHE NETHERLANDSt + 31 251 272 053f + 31 251 274 012INDAVER PORTUGAL s.a.Praceta Fernando Pessoa 17-BPT- 2685-409 PRIOR VELHOPORTUGALt + 351 21 940 50 40f + 351 21 940 12 60INDAVER ITALIA s.r.l.Via 1 Maggio 22IT-21040 ORIGGIO (VARESE)ITALYt + 39 02 967 340 32f + 39 02 967 317 89Przedsiebiorstwo EkologiczneINTEREKO Sp.z o.oUl. 10 Sudeckiej DywizjiZmechanizowanej 4PL-45 828 OpolePOLANDt + 48 77 451 52 70f + 48 77 451 52 71SPOVO s.a.Marianské HorySlovenská 2071CZ-709 00 OstravaCZECH REPUBLICt + 420 596 644 901f + 420 596 644 914www.indaver.be - www.indaver.com

RESPONSIBLE EDITOR: JOS ARTOIS ■ Dijle 17 a ■ BE-2800 MECHELEN ■ BELGIUMPHOTOGRAPHY: KOEN BROOS

Annual report 2006 - Indaver.com

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