Notes to the consolidated income statement (page 1)

Segment reporting

The segment reporting is based on geographical and business segments. An analysis by geography, which is Vedior’s primary format, and by business segment is the best reflection of Vedior’s management structure and reporting lines. The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies.

Vedior evaluates performance based on geographical and business segment contributions, which is defined as the amount of segment profit or loss before intercompany charges, finance costs and income tax expense.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly interest-bearing loans and corporate expenses.

Segment capital expenditure is the cost incurred by the segment during the period to acquire assets that are expected to be used for more than one year.

All segments are continuing operations.

Geographical segments
Vedior’s primary segment is determined by geography. The segments identified are France, United Kingdom, United States, Netherlands, Rest of Europe and Rest of World. The Rest of Europe segment consist of the European countries not reported separately, including Belgium, Spain, Italy, Portugal, Germany, Switzerland, Eastern Europe and Scandinavia. Rest of World includes non European countries and regions not reported separately including Australia, Asia, Canada and Latin America. Segment assets are based on the geographical location of the assets.

2005	France	UK	USA	Netherlands	Rest of Europe	Rest of World	Total

Sales ¹⁾ ²⁾	2,991	874	579	518	1,368	521	6,851

Result
Segment operating income ³⁾	96	52	35	14	37	24	258
Corporate expenses							-26
Operating income							232
Finance cost							-26
Share of profit of associates (after tax)							16
Income tax expense							-64
Profit for the period							158

Other information
Capital expenditure/Acquisitions	12	18	32	4	11	8	85
Depreciation and amortisation	-15	-7	-3	-3	-6	-3	-37
Impairment losses	-5						-5

Balance sheet
Segment assets	949	541	420	151	449	249	2,759
Investment in associates							8
Unallocated assets							31
Consolidated total assets							2,798

Segment liabilities	-654	-72	-47	-110	-232	-51	-1,166
Unallocated liabilities							-606
Consolidated total liabilities							-1,772

1)	From 2005, the sales generated in the US by our Canadian company are reported in the US. The comparative numbers have been adjusted accordingly.
2)	As of 2005, certain sales from the provision of managed services, where Vedior acts as a master vendor and is not primarily responsible for providing services to clients or has no credit risk relating to sales generated through sub-vendors, will be reported using the ‘net’ accounting method which only recognises the fee received on sales generated through sub-vendors. Until 2004, these sales were accounted for using the ‘gross’ accounting method, recognising sales and the cost of sales of services performed by sub-vendors. This change in accounting method only impacts US sales. If the ‘net’ method would have been applied in 2004, sales in the US, and for the Group, would have been €27 million lower on a full year basis. There is no impact on gross profit or operating profit. The comparative sales-numbers for 2004 have not been restated.
3)	From 2005, Vedior applies a revised allocation of corporate expenses to the various geographies. As a result, less costs were allocated to the UK (€2.1 million), the US (€0.9 million), Rest of Europe (€1.4 million) and Rest of World (€1.3 million), with corporate expenses increasing by €5.7 million.

2004	France	UK	USA	Netherlands	Rest of Europe	Rest of World	Total

Sales	2,867	840	513	478	1,273	504	6,475

Result
Segment operating income	88	53	21	9	33	23	227
Gain on disposal of subsidiaries							18
Corporate expenses							-14
Operating income							231
Finance cost							-41
Share of profit of associates (after tax)							1
Income tax expense							-66
Profit for the period							125

Other information
Capital expenditure/Acquisitions	11	8	2	5	9	17	52
Depreciation and amortisation	-20	-6	-4	-4	-7	-3	-44

Balance sheet
Segment assets	892	505	342	146	403	202	2,490
Investment in associates							12
Unallocated assets							20
Consolidated total assets							2,522

Segment liabilities	-697	-65	-32	-101	-201	-36	-1,132
Unallocated liabilities							-485
Consolidated total liabilities							-1,617

Business segments
Vedior provides both professional / executive as well as traditional recruitment services. Professional / executive recruitment services include the provision of personnel within the Information technology, Accounting, Engineering, Healthcare, Education and Other sectors.

	Sales		Segment assets		Capital Expenditure / Acquisitions
	2005	2004	2005	2004	2005	2004

Information technology	621	655	154	151	4	3
Healthcare	424	430	113	110	3	2
Engineering	410	363	104	86	3	2
Accounting	287	247	75	62	1	1
Education	111	113	26	25	1	1
Other sectors	408	330	103	78	3	3
Professional/executive	2,261	2,138	575	512	15	12
Traditional	4,590	4,337	1,295	1,186	23	20
Goodwill			889	792	47	20
Other unallocated assets			39	32
Total	6,851	6,475	2,798	2,522	85	52