More recurring businesses (infrastructure and services) accounted for 62% of total EBIT, which was 174.1 million euro: - Infrastructure and Services expanded by about 20% - Construction EBIT increased by 9.3% Consolidated revenues amounted to 1.808 billion euro (+6%): considerable growth in Construction (+9.3%), Infrastructure (+17.3%) and Services (+5%) Revenues from other countries increased by 22.3% to 702 million euro, 39% of the total The backlog assures growth: construction 6.803 billion euro (+9.1%); real estate 1.005 billion euro; services 5.386 billion euro. Infrastructure: growth in traffic (toll roads and airports) and a considerable increase in parking spaces Capital expenditure in the first quarter exceeded that in the entire previous year and amounted to 563 million euro, mainly to acquire the Chicago Skyway (USA) and to increase the stake in London Underground With 15% leverage, Ferrovial´s investment capacity is intact Ferrovial ended the first quarter of 2005 with notable growth in all business areas (construction, infrastructure and services) -with the exception of real estate, which was affected by a seasonal dip in the number of homes delivered to buyers-; the group expanded its international presence; the backlog increased and the group retains its investment capacity despite investing more in the quarter than it did in the entire previous year. As a result, profit amounted to 77.7 million euro, 11.3% more than in the first quarter of 2004. EBIT increased by 8.3% to 174.1 million euro, boosted by growth in revenues and over 20% growth by the more recurring businesses, which now account for 62% of the total. Construction continues strong, increasing EBIT by 9.3%. Net sales totalled 1,808.3 million euro, 5.9% more, driven mainly by activity in other countries in the area of construction (Poland, Portugal and Ireland) and services (Amey contributed nearly 21% of the group´s total revenues), plus the acquisition of the Chicago Skyway and the opening of the R-4 toll road in Madrid (Spain). Capital expenditure in the first quarter exceeded that in the entire previous year and amounted to 563 million euro, mainly to acquire the Chicago Skyway (USA) and to increase the stake in London Underground. By business area, revenues increased by 9.3% in construction, 17.3% in infrastructure and 4.9% in services; real estate development revenues fell 18.5% because of a seasonal dip in the number of homes delivered to buyers. International sales amounted to 702 million euro (a 22.3% increase) and they represented 39% of the company´s total sales. In addition to the UK (21%), the foreign countries making the greatest contribution to group revenues were Poland (6%), Canada (3%), Portugal (3%) and Chile (3%). Gross capital investment in the year amounted to 562.2 million euro, exceeding the total amount invested in 2004 (389 million euro). Investment in the quarter was mainly to acquire Chicago Skyway (376 million euro), an additional 33% of the London Underground concession company (139 million euro) and additional machinery, primarily tunnel-boring machines. Ferrovial also spent 127 million euro on land for real estate development. As a result of these investments, Ferrovial had a net debt position of 460 million euro at the end of the quarter; this represents 15% gearing, and the company´s investment capacity is therefore intact. Construction: international activity surged, margins were stable Strong growth in construction revenues (up 9.3% to 868.5 million euro) was due primarily to intense activity in other countries, mainly in Poland (Scut Norte Litoral), Ireland (N4/N6 toll road) and Poland. Construction EBIT grew 9.3% to 37.6 million euro, and the EBIT margin stabilised at 4.3%. The construction backlog grew by 9.1% in 2004 to 6.803 billion euro, representing 23 months of activity. Capital expenditure increased 3.5-fold due to the acquisition of machinery, principally tunnel-boring machines. Polish subsidiary Budimex increased revenues by 152% to 101.6 million euro and its backlog expanded by 32% to 611 million euro. Infrastructure: traffic increased, margins expanded, and operations in the US commenced The infrastructure division, which includes toll roads, airports and car parks, increased sales by 17.3% to 161.4 million euro, boosted by the integration of Chicago Skyway (effective 24 January) and growth in the car park business due to full consolidation of the Eguisa car parks. EBIT totalled 60.7 million euro, 21.2% more than in the first quarter of 2004. The EBIT margin increased to 37.6%. Traffic performance on the main toll roads led to 122.1 million euro in revenues in the toll road division (+17.6%) and EBIT of 52.7 million euro (+18.2%) The 407 ETR performed very well, with revenues up 10.5% and EBIT up 29.4%; traffic increased by 4.6% in the period despite a toll increase on 7 February (+7.2% peak and +7.6% off-peak). Also in Canada, the Ontario Superior Court ruled in favour of the 407 ETR concession company and dismissed the Province of Ontario´s appeal against the arbitration decision issued on 10 July 2004, which stated that 407 ETR did not need any authorisation from the provincial government in order to increase tolls. The Group commenced operation of its first toll road in the US, the Chicago Skyway, and closed the syndication of the US$1.19 billion non-recourse senior debt facility, having obtained commitments for double that amount from 15 international banks. Revenues in the car park area increased by 22.7% to 26.5 million euro and the number of parking spaces under management rose to over 212,000. EBIT increased significantly (+88.6%) and the EBIT margin was 24.9% (16.2% in the first quarter of 2004). Growth in key figures in the airports division was due basically to a sizeable increase in traffic: Sydney +6%, Bristol +12%, and Belfast +16%. Real estate: backlog guarantees sales in the coming 18 months Because of a seasonal dip in the number of homes delivered to buyers in the first quarter of 2005, real estate division revenues declined 18.5% to 162.4 million euro. EBIT amounted to 30 million euro, and the EBIT margin stabilised at 18.5% of revenues. The backlog amounted to 1.005 billion euro, assuring sales for the next 18 months, approximately. Realty brokerage, conducted through Don Piso, increased sales by 35% to 33.4 million euro. Services: margins improved, and the stake in Tube Lines (UK) was increased The services area established itself as the group´s second-largest division in terms of revenues and EBIT: it accounts for 35% and 27%, respectively, of the total. In the first quarter of 2005, the division obtained 647.7 million euro in revenues, a 4.7% increase, and EBIT amounted to 46.9 million euro, up 18.1%. The EBIT margin increased notably to 7.2%, compared with 6.4% in the first quarter of 2004. Through Amey, the services business is firmly established in the UK, a market which now provides 57.5% of this division´s total revenues and half of its EBIT. Amey also notably increased its EBIT margin to 6.2% (5.8% in the first quarter of 2004). The services backlog reached 5.386 billion euro, 4.3% more than at the end of March 2004. The backlog does not include the London Underground renovation and maintenance contract, which will provide 15 million euro in annual sales for the next 28 years. During the quarter, Ferrovial acquired an additional 33% of the Tube Lines concession company, strengthening Amey´s presence in the UK´s largest PFI contract. The financial information herein relating to the first quarter of 2005 compared with 2004 was drafted, for both periods, under the new accounting standards adopted by the European Union for drafting the financial statements of listed consolidated groups from 1 January 2005. IAS 32 and 39 are applied to financial assets in both periods. The application of IFRS for concession companies is somewhat undefined at this time since, although general IFRS are applicable to them, a definitive interpretation of the specific regime applicable to concessions has yet to be published. The draft interpretations (D12, D13 and D14) were published by IFRIC in early 2005 and envisage the possibility of not applying them pending the final wording, provided that the accounting principles established in IFRS are adopted. Grupo Ferrovial has presented its 1Q05 results under IFRS by adopting the following approaches: It has not applied the IFRIC interpretations as regards the development of the two proposed models (intangible asset and account receivable); it does not capitalise financial expenses accrued after the end of the construction period; and it applies straight-line depreciation for the concession assets.