D. Risk factors and management procedures
This chapter details the principal risks to which the VINCI Group’s various activities are exposed as well as changes in the year under review, which are summarised in the table shown opposite.
The level of criticality of each of these risks (high, intermediate or moderate) was determined on the basis of its probability of occurrence and the anticipated extent of its net impact on the Group, in consideration of risk management procedures already in place. In addition, it should be noted that, as part of the implementation of the European Union’s Corporate Sustainability Reporting Directive (CSRD), non-financial risks are also handled through the double materiality assessment carried out as the basis for the disclosures in the Group’s Sustainability report (chapter E of this Report of the Board of Directors).
Several events contributed to a climate of uncertainty in 2024, chief among them the following:
- In France, the announcement in mid-June dissolving the National Assembly and calling for new parliamentary elections ushered in a period of considerable political uncertainty. Against this backdrop, the spread between French and German 10-year government bond yields widened. The budgetary difficulties faced by France and the measures planned to address them in particular tax rises weighed on investor confidence.
- In Germany, the collapse of the governing coalition at the end of 2024 set the stage for snap elections in February 2025, weakening confidence in the growth outlook for Europe’s largest economy.
- In the United States, the election of Donald Trump may lead to a break with policies currently in place, in terms of both foreign affairs and trade. In this context, the newly elected US president may very well follow through on plans to introduce a number of protectionist measures, such as higher tariffs, which could endanger the global economic equilibrium.
- Among geopolitical events, the war between Russia and Ukraine continued and it is still difficult to determine how it might end. In the Middle East, following the attack against Israel on 7 October 2023, tensions escalated over the year between the country and Iran. Although the Group’s direct exposure is marginal in these regions, the indirect effects of these tensions (rising oil prices, destabilised supply chains and worsening inflation, to name a few) merit attention.
- From the monetary perspective, following an unprecedented tightening of policy between 2022 and 2023, the major central banks started to ease their policies in 2024. The extent and pace of rate reductions in the future will depend upon economic and inflationary trends tied in particular to the issues mentioned above in various regions. Lastly, the concerns expressed by the International Monetary Fund in October 2024 regarding the high level of public debt in many countries are worth noting.
Furthermore, a number of natural disasters occurred in 2024, notably in Spain and Mayotte at the end of the year.
Despite this tumultuous environment, the VINCI Group’s performance in 2024 was outstanding. Its results illustrate once again the resilience of the Group’s business model, which combines complementary businesses, areas of expertise and cycles, buoyed by the energy transition and digital transformation as strong underlying trends, its diversified geographic presence, its selective approach to new business, and the prudent perspective adopted for its financial and operational management. In particular, VINCI pays close attention to maintaining a high level of liquidity to cope well with unexpected circumstances and pursue its growth under the best conditions.
Although its risk profile has remained for the most part unchanged, the Group has noted upward trends in four risk categories over the past year:
Operational risks
- Energy and Construction businesses: The political, geopolitical and macroeconomic uncertainties described above could prompt customers and contracting authorities to favour a wait-and-see approach. And the severe budgetary constraints and high deficits of some countries, including France, could lead to a decrease in spending affecting public procurement in the short or medium term. However, over the longer term, this situation might require greater mobilisation by the private sector through public-private partnerships. The Group has considerable experience in handling this type of cycle, with its decentralised model ensuring its subsidiaries’ agility and their ability to make rapid structural adjustments. Its geographic diversification and its business mix are also advantages in weathering the cyclical difficulties encountered in some markets.
- Concessions business: The risk of a rise in armed conflicts around the world could slow trends in airport passenger numbers. Furthermore, the anticipated increase in taxes on airline tickets in France could impact demand for travel to or from destinations in the country.
Cyber risks
The rise in conflicts and tensions between governments has heightened cyber risks, which are especially critical for strategic assets and activities of vital importance. In addition, cyberattacks powered by artificial intelligence are becoming more frequent and represent a new security threat for companies. In this context, the strengthening and continuous improvement of IT security measures are a priority for the Group.
Social risks
The various geopolitical crises described above expose the Group to heightened risks relating to the safety and security of employees, partners, subcontractors and other Group stakeholders, especially in regions near those riven by conflict. These crises, compounded by the consequences of climate change, are leading to migratory movements that can destabilise countries of origin and arrival on the economic, social and security fronts.
The current crisis affecting the property development sector in France and more generally in Europe could lead to a housing crisis and heightened social tensions if government authorities do not rapidly take corrective measures. In this context, the Group will continue to maintain its close ties to and its social engagement with local communities.
