- The company’s businesses performed well: revenues increased by 7.7% in Toll Roads, 8.3% in Services and 24.6% in International Construction. The company also landed important contracts in Services (Sheffield), Toll Roads (Highway 407 East Extension), and Construction (Galicia high-speed railway).
- The main assets reflect the improvement in traffic and higher fees/tolls, which provided notable growth in EBITDA: +12% at Canadian toll road 407ETR and 16% at London’s Heathrow airport, both in local currency terms.
- The combined Construction and Services backlog remains at record levels: 22.000 billion euro.
- BAA paid its shareholders a quarterly dividend amounting to 60 million pounds, 407ETR distributed 87 million Canadian dollars; Ferrovial received 63 million euro.
Ferrovial, a global infrastructure and services company, obtained 192 million euro in EBITDA in the first quarter of 2012, compared with 172 million euro in 1Q11, i.e. an improvement of 11.7%. In the first few months of 2012, Ferrovial’s main businesses improved, particularly revenues at Amey (UK), and international construction, mainly Budimex. Revenues amounted to 1.707 billion euro, a 2.5% increase.
Net profit in 1Q12 amounted to 7.6 million euro, contrasting with 224 million euro in the first quarter of 2011, when the company booked gains on the sale of Swissport and the stake in the M-45 toll road.
The Construction and Services backlog remains at record levels: 22.000 billion euro. The backlog reflects the company’s internationalization, as 68% in Construction and 49% in Services are located in countries other than Spain.
In the period, BAA paid its shareholders a quarterly dividend amounting to 60 million pounds, 407ETR distributed 87 million Canadian dollars; Ferrovial received 63 million euro.
Strong traffic at the main assets
The company’s two main assets, Canadian toll road 407ETR and Heathrow Airport, continue to register positive traffic performance, which, together with higher tolls and fees, provided notable growth in their EBITDA: +12% at 407ETR and +16% at Heathrow. International Construction reported an increase of 24.6% in revenues and of 7.1% in EBITDA, supported by strong growth by Budimex (revenues up 40%). Several projects commenced in the period, including some at Webber in the US and the Crossrail project in the UK. In Services, revenues at Amey expanded by a notable 22% due to the start-up of several contracts, including road maintenance in Area 9 (West/Midlands) and in London.
The net cash position (excluding infrastructure projects) was 518 million euro at the end of the quarter. Including infrastructure projects, consolidated net debt totaled 5.589 billion euro at the end of the quarter.
The main assets took advantage of opportunities in the quarter to issue bonds, which were well received by the market. BAA issued more than 2.200 billion pounds, strengthening its currency diversification strategy with a new issue in Swiss francs; previous issues were in pounds, dollars and euro.
407ETR issued bonds worth 400 million Canadian dollars in April, enabling it to postpone debt maturities from 2014 to 2042. As a result, the company does not have to address any major maturities in the coming years.
Despite changes in the company’s consolidation scope and equity accounting of the 407ETR and BAA, the company’s geographic and business diversification strategy in recent years is reflected in its income statement. The international business accounted for 59% of revenues and 48% of EBITDA.
Services: Strength in the UK
The Services division attained 733 million euro in revenues in the first quarter of 2012, i.e. growth of 8.3%, while EBITDA amounted to 69 million euro. The backlog remains at record levels: 12.327 billion euro.
UK subsidiary Amey increased revenues by 22% to 369 million euro, attributable to the commencement of new contracts awarded in 2011 and greater revenues from pre-existing contracts. Its backlog amounted to 6.056 billion euro. Among the important contracts awarded recently, which are not included in the backlog, of special note is being named “preferred bidder” by the Sheffield city council (UK) to maintain the city’s infrastructure for 25 years.
In Spain, revenues totaled 364 million euro and EBITDA amounted to 47 million euro. The backlog, amounting to 6.271 billion euro, includes two treatment plants in the Canary Islands. Other notable contracts obtained in Spain include: two new contracts for upkeep and maintenance of green areas in 11 districts of Madrid, and start-up of the Toledo Ecopark.
Toll roads: Positive performance
Toll road revenues rose 7.7% with respect to last year, to 88 million euro. EBITDA increased by 38.2% to 80 million euro.
Canadian toll road 407ETR continues to perform very soundly in terms of both traffic and kilometers travelled. Revenues increased by 9.5% and EBITDA by 12.1% in local currency terms; this investment is equity-accounted.
Cintra was recently chosen as Preferred Proponent to design, build, finance and maintain the first phase of Highway 407 East Extension, in Ontario, Canada.
In Spain, the company also landed the concession for the Almanzora highway in Almería, which includes building, maintaining and managing three sections of the Almanzora highway between Purchena and the A-7 Mediterranean highway.
Construction: Growth continues in international markets
The Construction division obtained 898 million euro in revenues and 48 million euro in EBITDA in the first three months of 2012. The backlog remained stable at 9.667 billion euro due to new contract intake at Budimex and Webber.
The international business contributed revenues of 577 million euro, i.e. 24.6% more than in the same period of 2011, and EBITDA of 23 million euro, up 7.1%. The international backlog amounted to 6.600 billion euro due to new projects in the US and the UK, accounting for 68% of the division total.
Budimex and Webber reported significant growth in the main line items during the period. Polish subsidiary Budimex expanded revenues by 46.5% to 265 million euro, while the US subsidiary experienced a 23% increase to 115 million.
The Spanish market maintained the trend observed in the last few quarters, and fewer projects were executed in building and civil engineering, despite recent contract awards such as the 108.8 million euro project to build the rail bed on the Padorenol Tunnel-Lubián section of the high-speed railway line between Madrid and Galicia. The backlog amounted to 3.067 billion euro in the period.
Airports: Heathrow traffic up 4.4%
BAA attained 589 million pounds in revenues, a 10.6% increase, while EBITDA amounted to 247 million pounds, a 10.7% increase.
Traffic performed positively in the first quarter, growing by 2.4%. Heathrow’s traffic totaled 15.7 million passengers, i.e. 4.4% growth in the first three months of the year. The high occupancy, increase in fees and growth in retail revenues are behind this strong performance.
Europe and Long Haul continued to show strong growth in traffic, with North Atlantic destinations as the top performers.
On 23 April, BAA announced it had reached an agreement to sell 100% of its stake in Edinburgh Airport to Global Infrastructure Partners (“GIP”) for 807.2 million pounds, i.e. 16.7 times EBITDA.
