·At euros 77.5 million, Ferrovials net income is up 127.6%
·Operating income rises 35.2% to euros 97 million
·Consolidated sales total euros 1,427 million, a 12% increase, with significant growth in construction (+12%), concessions (+77.4%) and services (+102%).
·The construction backlog hits a record high of euros 4,727 million, a 20% increase with respect to June 1999.
·Gross investments to June 2000 amount to euros 383 million.
Ferrovial obtained euros 77.5 million (Ptas 12.895 billion) in net income attributed to the controlling company in the first half of 2000, a 127.6% increase on the euros 34 million (Ptas 5.662 billion) posted in June 1999. Income before tax totaled euros 107 million (Ptas 17.780 billion), 111% more than in the same period in 1999.
Operating income rose by 35.2% with respect to the figure recorded in June 1999 to total euros 96.8 million (Ptas 16.100 billion) and the margin improves from 5.6% to 6.8%. Businesses other than construction account for 63% of aggregated operating income.
As of 30 June 2000, consolidated sales amounted to euros 1,427.1 million (Ptas 237.450 billion), 12% more than last year, with sharp increases in all the business divisions mainly construction, with a 12% increase; infrastructure concessions with 77.4%; and services, with 102%.
In the first quarter of 2000, Ferrovial continued to make hefty investments, which totaled euros 382.7 million (Ptas 63.675 billion). These principally went to the acquisition of 58.5% of the Polish construction firm Budimex, the concession for the Scut motorway in Portugals Algarve and the purchase of Grupisa, one of the leading Spanish companies engaging in integral road maintenance.
Record construction backlog and investment in Poland
Sales in the construction business rose by 12% to euros 1,218 million (Ptas 202.658 billion). As of 30 June 2000, the construction backlog reached a record high of euros 4,727 million (Ptas 786.505 billion), a 20% increase on the figure registered in June 1999.
In the early months of this year, Ferrovial completed the acquisition of a 58.5% stake in the Polish construction firm Budimex. This investment is a strategic bid in the Polish and Central European construction markets, where growth will be driven by the EU funds going to countries in this area when they join the EU as from the year 2003. Budimexs sales are estimated at euros 480 million (Ptas 80 billion) in 2000.
As of 30 June 2000, sales in the real estate division totaled euros 60.6 million (Ptas 10.083 billion) and pre-sold inventories rose to euros 275.5 million (Ptas 45.840 billion). These figures reflect a seasonal effect in housing delivery, which will be more intense in the second half of the year, particularly in the last quarter. Ferrovial Inmobiliaria has recently acquired land under development for 3,600 homes in Madrid, Malaga and the Basque Country, which are to be delivered over the next four years. The operation, which represents an investment of euros 240 million (Ptas 40.000 billion), speeds up the development of the Groups real estate division and guarantees it sustained stable growth in the medium term.
In the property management business, conducted through the joint venture with Morgan Stanley, the Recoletos 3 and Ortega y Gasset 100 buildings were sold during the period, bringing Ferrovial euros 3 million (Ptas 500 million) in capital gains.
Concessions, services and telecommunications
In the concessions business, run through Cintra, as of 30 June sales were up by 77.4% and amounted to euros 115.6 million (Ptas 19.235 billion), with a significant contribution from the ETR 407 motorway in Canada and the Costa del Sol motorway between Malaga and Estepona.
In this period, the C$ 775 million in subordinated debt, which the partners had undertaken to pay in three years, was completely refinanced. For Ferrovial, this implies a smaller investment or a reduction in risk of euros 300 million (C$ 475 million). Lastly, the financing of the Scut motorway in Portugals Algarve region was also completed; this project involves an investment of euros 228 million (Ptas 38.000 billion) and is a 30-year contract, under the shadow toll regime.
In the service business, sales were up 102% as of 30 June and amounted to euros 83.2 million (Ptas 13.844 billion). This business doubles its sales figures, partly as a result of the new contracts won in 1999 and the acquisition of Grupisa, one of the leading Spanish companies in integral road maintenance and the manufacture and installation of horizontal and vertical signposting. The service backlog amounts to euros 695 million (Ptas 11.565 billion), an 11% increase with respect to June 1999.
Since the end of June, the most notable event in telecommunications was the value made on Ferrovials investments, through the spin-off of Uni2s residential internet business which goes to Wanadoo, France Telecoms portal. The internet business to be spun off has been valued at euros1,007 million (Ptas 167.550 billion). Ferrovials 7.6% holding in the business spun off is worth euros 76.5 million (Ptas 12.700 billion). It will receive this in the form of Wanadoo shares, which trade on the Paris Stock Exchange. Even so, Ferrovial will keep its 7.6% stake in the global operator Uni2. Lastly, Cableuropa (Ono), the cable operator in which Ferrovial has a 17.6% holding, has informed the CNMV (Spanish SEC) of its plans to list up to 25% of its share capital.
