Ferrovial N.v. · BME:FER
Ferrovial — 9M 2014 Earnings Presentation
38 slides from Ferrovial's earnings presentation, November 2014
Slide 1: Investing for growth
9M 2014 Investing for growth ferrovial 1 2014
Slide 2: Ferrovial Overview & Strategy
Ferrovial Overview & Strategy 2
Slide 3: What is Ferrovial?
What is Ferrovial? EX-INFRASTRUCTURE PROJECTS DESIGN & CONSTRUCTION MAINTENANCE Construction Services INFRASTRUCTURE PROJECTS OPERATION Toll roads Airports Design, Financing, Construction, Operation & Maintenance of infrastructure assets & Provider of services to cities STRATEGY 1. Profitable Growth
Slide 4: 1. Profitable growth. Solid Financial Situation
1. Profitable growth. Solid Financial Situation 9M’14 Figures EX–INFRASTRUCTURE PROJECTS Net debt evolution ex-infrastructure projects €mn 1,484 1,663 1.533 907 31 NET CASH €1,533mn 1,547 1,172 1,987 3,064 2006 2007 2008 2009 2010 2011 2012 2013 9M´14 PARENT COMPANY INFRASTRUCTURE PROJECTS Debt allo
Slide 5: No meaningful maturities until 2018
No meaningful maturities until 2018 Financial position (ex-infrastructure projects) 2014-2019 maturities €m - September ‘14 811 501 43 96 14 18 11 2014 2015 2016 2017 2018 2019 >2019 Liquidity position €m - September ‘14 868 3.935 3.067 Total cash Undrawn lines Total liquidity 5
Slide 6: 2. Cash Flow Generation
2. Cash Flow Generation 2013 figures € 343mn EX-INFRASTRUCTURE EBITDA from Construction PROJECTS Net cash position € 322mn EBITDA from Services Non capital intensive / Backlog visibility / EPS accretive PARENT COMPANY Controlling Shareholder 43% Free float 57% € 219mn Dividends from Airports INFRAST
Slide 7: Where does our OCF come from?
Where does our OCF come from? GDP Forecast 2015 & 2016 2013 Operating CF Real GDP Growth exp.* (€1,048mn) 2015 2016 UK 34% 2.7% 2.5% Over 70% of OCF from faster Canada 22% 2.5% 2.5% growing economies USA 17% 3.1% 3.2% Spain 13% 1.7% 2.2% Poland 7% 2.8% 3.3% Germany 0% 1.1% 1.8% France 0% 0.7% 1.5% A
Slide 8: 3. Shareholder remuneration
3. Shareholder remuneration Dividends (€/share) Interim dividend (paid Dec´13) 0.40 2013 Scrip dividend equivalent to 2013 complementary dividend (paid Jul’14) 0.291 TOTAL 0.691 Scrip dividend equivalent to 2014 interim dividend (paid Nov’14) 0.381 * Dividend evolution (€/share) 1.25 0.691 0.42 0.45
Slide 9: Ferrovial today: 9M2014 Results
Ferrovial today: 9M2014 Results 9
Slide 10: Services
Services Largest division by revenues & backlog Services € million 9M´14 ∆% Strong revenue growth in Spain & UK (combined organic growth +7.8%) Revenues 3,202 +22.2% Enterprise integration on track EBITDA 246 +16.5% Volume and profitability expansion EBITDA % 7.7% -40 bps Increase in margins (9M 7.7
Slide 11: Construction
Construction 9M 2014: Backlog by geography • Backlog €7.7bn, -1.8% vs Dec13 74% 26% • €800mn already awarded and still to be included International Domestic • Sales -0.2% & EBITDA +16.1% • International turnover: 77% USA España 33% • Poland: infrastructure roads plan 2014-19, €10.0bn 25% • Spain: hi
Slide 12: Toll roads
Toll roads Traffic growth across our portfolio Traffic evolution Canada & Europe (Ireland, Portugal and Spain) 2014 ∆% 9M 3Q Very active pipeline Ausol I (Spain) +3.3% +5.2% Bidding in US / Australia / Canada Monitoring of opportunities in other markets Algarve (Portugal) +10.0% +8.9% M4 (Ireland) +
Slide 13: Managed Lanes - New asset landmark
Managed Lanes - New asset landmark “Express Tollway within an Existing Highway” Free Tolled Lanes Free Lanes Speed >50mph Lanes A solution to congestion on “existing urban corridors” by means of Active management of “newly added capacity” through dynamic tolling Opened Oct 2014 Expected mid-2015 Exp
Slide 14: HAH (Eq. method, FER stake 25%)
HAH (Eq. method, FER stake 25%) Heathrow T2 opened June 4th HAH (c.350m flights per day) 100% GBP million 9M´14 ∆% Heathrow 3rd runway proposal shortlisted Revenues 2,125 +8.1% for further analysis (Airports Commission) EBITDA 1,199 +11.2% Highest ever passenger satisfaction EBITDA % 56.4% +160 bps
Slide 15: Heathrow - Best ever passenger satisfaction
Heathrow - Best ever passenger satisfaction Departures % passengers rating Missed bags punctuality Heathrow “Excellent” or per 1,000 passengers “Very good” 40 78% 79% 63% 48% 19 2007 9M´14 2007 9M´14 2007 9M´14 Over 78% of passengers surveyed rated their experience as Excellent or very good 15
Slide 16: Financial results & recent M&A
Financial results & recent M&A Credit rating upgrade by Fitch (from BBB- to BBB) in July 10Y corporate bond issued in July (coupon 2.5%) Financial New EUR750mn liquidity line in April (5 years, 80bps cost) €1.5bn Net cash* / €3.9bn Liquidity Transfield services indicative non-binding proposal for 10
Slide 17: Spain 2014
Spain 2014 … Better traffic Traffic Ausol I 5,2% (Toll roads) 1,8% -9,8% FY 2013 1H´14 3Q'14 … Better collections Days of sales outstanding 201 211 (Services) 146 120 116 2010 2011 2012 2013 9M´14 … Higher volumes Waste Tons 5,2% (Services) -6,6% -5,3% 1H'13 FY 2013 9M´14 … Higher public bidding pub
Slide 18: Why Ferrovial?
Why Ferrovial? Solid financial position Operating CF* Highest ever €1.5bn Net cash diversification backlog €28.4bn 34% 7% 17% (42 months of activity) 13% 29% High quality Active pipeline assets Attractive US /Australia /Canada Strong dividend shareholder Monitoring other generation remuneration mark
Slide 19: Thank you
Thank you Ferrovial Investor Relations 19 E-mail: [email protected] – Tel: +34 91 586 27 30
Slide 20: Appendix: Introduction to 407ETR Toll road, Managed Lanes
Appendix Introduction to 407ETR Toll road Managed Lanes Toll roads 20
Slide 21: Would you buy this company…?
407 ETR Would you buy this company…? CAN million Shareholder’s Equity Net debt 1999: 1999 775 1,937 27x Debt/Ebitda 2013 -1,694 5,759 Accounting High losses debt 21
Slide 22: Ferrovial bought this company…
407 ETR Ferrovial bought this company… Cash Generation Valuation 407 ETR (1999-2013) (100%) € million € million Initial equity investment (62%) (326mn) 100% pay-back 10.918 Dividends (00 - 13) 1,051mn in first 10 years 21x 10% disposal 640mn NET CASH IN 1,365mn Valuation x21 525 1999 Sept´14 Maturit
Slide 23: 407 ETR location and area of expansion
407 ETR Location Area of expansion 407 East extension High density population area Ring road of Toronto 108 km 407 23
Slide 24: All Electronic Roadside Tolling System
407 ETR All Electronic Roadside Tolling System Sophisticated electronic toll highway NO toll-booths, “closed ticket” tolling scheme (on/off ramps) NO stopping or slow-downs to pay ALL vehicles able to use highway Transponder not required. If valid transponder is not detected, digital images are take
Slide 25: ETR location Greater Toronto Area
Fast 407 ETR Safe Reliable LOCATION HIGH Greater Toronto Area HOUSEHOLD INCOME 23% of Canada 46% higher population than Canada average SPEED NO REGULATORY Alternatives routes REVIEWS 40kph vs 100kph at During concession 407 life (99 years) TOLL RATE HIGH TRAFFIC FLEXIBILITY Alternatives routes Inclu
Slide 26: Financial overview ($CAD million)
407 ETR Financial overview ($CAD million) Revenues Capital Expenditure CAGR: 8.4% 801 97 90 88 72 77 74 70 420 49 84 years to maturity 38 2005 2013 2005 2006 2007 2008 2009 2010 2011 2012 2013 OPEX Dividends CAGR: 3.4% 136 680 600 104 100% pay-back in first 10 460 years 300 190 145 120 135 85 2005 2
Slide 27: ETR recurrent presence in the bond market
407 ETR ETR Recurrent presence in the bond market (June’13) Extending maturities at historically low cost CAD 2,950mn issued since 2009 500 Maturity 400 400 3,58% 40 years 350 3,49% 39 300 300 300 200 200 200 30 30 2009 2009 2010 2010 2010 2010 2011 2012 2012 2013 Spread 1,58% 1,56% 1,60% Yearly avg
Slide 28: Appendix: Introduction to 407ETR Toll road, Managed Lanes
Appendix Introduction to 407ETR Toll road Managed Lanes Toll roads 28
Slide 29: New assets landmark: Express Tollway within an Existing Highway
Managed Lanes New assets landmark “Express Tollway within an Existing Highway” Free Tolled Lanes Free Lanes Speed >50mph Lanes A solution to congestion on “existing urban corridors” by means of Active management of “newly added capacity” through tolling 29
Slide 30: Level of demand
Managed Lanes Level of demand NTE (untolled) 407ETR (tolled) Peak period Westbound Eastbound 00.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 18.00 20.00 22.00 24.00 12.00 2.00 4.00 6.00 8.00 10.00 12.00 2.00 4.00 6.00 8.00 10.00 12.00 Time of the day Time of the day 30
Slide 31: Paying for predictability: travel time variability
Paying for predictability Travel time variability Travel Time Variability 70 60 50 40 Time (min) Time (min) 30 Free Flow Travel Mean 20 10 0 NB AM NB MD NB PM SB AM SB MD SB PM NB - North bound SB - South bound • Free flow time of 14 minutes at 6.00AM • The average travel time during all time period
Slide 32: Toll rates – tariff threshold
Toll rates – tariff threshold Tariff threshold Toll Rate Toll Rate Cap 0.75 c/mi Demand threshold 3300 pce/h 2-lane sections Speed Speed Threshold 50 mi/h Demand 12:00 1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 Hour starting Analysis by segment and direction Freedom under the cap
Slide 33: Dallas and Fort Worth Regional Map
Dallas and Fort Worth Regional Map Managed Lanes regional map LBJ NTE 1-2 NTE 3 33
Slide 34: Lyndon B Johnson
Managed Lanes Lyndon B Johnson Construction expected to be concluded in 2015 Key characteristics DESCRIPTION: IH 635 (Dallas County), the most populous county in Texas LENGTH: 13 mile section of the IH 635 and IH 35E 108Km Electronic toll CONCESSION PERIOD: 52 years TARIFF POLICY: Open Road Tolling
Slide 35: North Tarrant Express
Managed Lanes North Tarrant Express Opened on October 4th, 9 months ahead of schedule Key characteristics DESCRIPTION: Dallas-Fort Worth Metroplex, Major thoroughfares between Fort Worth and DFW Airport LENGTH: 13 mile section (IH 820 & SH 183 in Tarrant County) CONCESSION PERIOD: 52 years TARIFF PO
Slide 36: North Tarrant Express 35W
Managed Lanes North Tarrant Express 35W Expected to open in mid-2018 Key characteristics DESCRIPTION: 2 “managed lanes” in each direction of the IH-35W, segments 3A and 3B (3B segment to be built by TxDOT) LENGTH: 10.2 mile section (segments 3A 6.2 miles and 3B 4 miles) CONCESSION PERIOD: 48 years T
Slide 37: Managed Lanes Financial Overview
Managed Lanes Financial Overview Figures in US Dollars Total Investment: 2.10 bn 2.63 bn 1.36 bn Private Equity: 21% 427 m 26% 672 m 32% 430 m Cintra: 243 m (57%) 343 m (51%) 216 m (50%) Meridiam: 141 m (33%) 285 m (42%) 60 m (14%) DPFPS: 43 m (10%) 44 m (7%) 43 m (10%) APG: 112 m (26%) Total Debt:
Slide 38: Disclaimer
Disclaimer This document may contain statements that constitute forward looking statements about the Company. These statements are based on financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations, which refer to estimates regardin