Strategy In 2004, Vedior’s Board of Management conducted a review of the Group’s strategy which encompassed every aspect of the business. This review confirmed that Vedior’s fundamental strategic principles are sound in meeting current and future market challenges and identified a number of refinements. Vedior’s primary objective is to provide superior investment returns with higher organic profit growth and better operating margins than our competitors. We intend to achieve this by extending our leading position in professional/executive recruitment sectors, developing a balanced earnings stream and improving our business mix through both organic and acquisitive growth. Other important objectives are to increase our share of business with existing clients, improve the geographic balance of our business, improve operating efficiency, invest more in our people and become the employer of choice, improve cash flow to further strengthen our balance sheet.

Where Stephane matters...   “My decision to work as a temporary was made because of the flexible advantages it offers. Thus, I have enough spare time to suit my needs, something which will not necessarily be offered to me by a full-time job. Moreover, by working for diverse employers, I can avoid falling into a routine – sometimes exhausting in this profession. I can remain enthusiastic about my work, while at the same time, learning about the various practices and protocols of care used in different establishments. I look after short-stay and long-stay patients in post-operative care, rehabilitation and geriatrics but also work in surgery or medicine, allowing me to alternate roles. I endeavour as much as possible to carry out the role of the person I’m substituting for in order to provide continuity of care so that patients are not penalised during their hospitalisation.”

We have also set a number of challenging financial objectives based on achievable operating margins within our major geographical areas of operation. These objectives have been calculated based on historical highs previously reached by Vedior in each of our most important markets between 1997 and 2000. We believe these objectives are achievable at the economic peak within each individual market assuming normal cyclical patterns and without any fundamental adjustments to our business model.    2004 operating margins 1)  Target operating margins 2)  Proportion 2004 professional/ executive sales France 3.1% 4.0 to 4.5% 12% UK  6.3%  7.0 to 8.0%  77% USA   4.3%  7.0 to 8.0%  83% Netherlands 2.1% 5.0 to 6.0%  23% Rest of Europe 2.6% 3.5 to 4.0% 23% Rest of World 4.4% 5.0 to 6.0%  53% Vedior Group 3.5% 5.0 to 6.0%  32% 1) Excluding disposals, special items and corporate expenses. 2) Assuming current business mix. The achievement of these local objectives would result in an overall Group operating margin (before corporate expenses) in the range of 5.0% to 6.0%. However, it is important to recognise that our industry is economically sensitive and peaks in each market do not necessarily occur simultaneously. On the other hand, given that these objectives are based on our current mix of business, should we be successful in our aim of increasing the proportion of sales we derive from higher-margin professional/executive recruitment, we believe these objectives are achievable given favourable economic conditions. Our strategic review provides us with confidence that Vedior can provide superior investment returns given our strong business model, our sound financial structure and also because we operate in an attractive industry.