ferrovial: investor presentation jan jun 2014 | presentación inversores ene jun 2014

1 E-mail: [email protected] – Tel: +34 91 586 27 302014ferrovial

Investing for growth

2 E-mail: [email protected] – Tel: +34 91 586 27 30

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 regarding, among others, future growth in

the different business lines and the global business, market share, financial results and other aspects of the activity

and situation relating to the Company.

Such forward looking statements, by its nature, are not guarantees of future performance and involve risks and

uncertainties, and other important factors that could cause actual developments or results to differ from those

expressed in these forward looking statements.

Analysts and investors, and any other person or entity that may need to take decisions, or prepare or release

opinions about the securities issued by the Company, are cautioned not to place undue reliance on those forward

looking statements which speak only as of the date of this communication. They are all encouraged to consult the

Company’s communications and periodic filings made with the relevant securities markets regulators and, in

particular, with the Spanish Securities Markets Regulator.


Agenda

Group overview

Looking Ahead

Appendix

2014 – First Half results

Introduction to 407ETR Toll road

Managed Lanes Toll roads

2013 – Full year results


INFRASTRUCTURE

PROJECTS

PARENT COMPANY

EXCL INFRA PROJECTS

� Leading sponsor of tollroadsinfrastructure development

worldwide

� Key developer of ETR 407

� Design, build, finance & operation

� Leading European airport operator

� Ownership and manager of 4 UK

airports, including Heathrow

� One of the European

construction leading groups

� Civil engineering, industrial

construction & water treatment

� Leading provider of infrastructure

services� Infrastructure & Maintenance

management

� Urban services & waste

management

Capital intensive / Inflation protected / LT duration & financing

Controlling Shareholder 43%Free float 57%

Non capital intensive / Backlog visibility / EPS accretive

Ring fenced debt

Net cash position

Ferrovial Business Overview

€242mnDividends from Toll roads

€219mnDividends from Airports

€322mn

€343mnEBITDA from Construction

EBITDA from Services

2013 figures


Debt Overview

Net debt evolution ex-infra projects

3,064

1,9871,547

1,172

31

9071,484 1,663 1.599

2006 2007 2008 2009 2010 2011 2012 2013 1H14

PROJECTSEX – INFRA PROJECTS

€mn Net debt

NTE 667

LBJ 929

NTE 3A3B 65

TOTAL 1,661

TOLL ROADS*

€6,835mn

Projects under development not generating EBITDA

= 23%

of Toll roads

net debt

NET DEBT€7,162mn

* €1,163mn related to R4 & OLR, both filed for creditor protection

1H ‘14

PROJECTS Debt allocated at project level

1H ‘14

NET CASH €1,599mn

€mn

€mn


44 42 19 11

501

5

510

2014 2015 2016 2017 2018 2019 >2019

No meaningful maturities until 2018Financial position (ex-infra projects)

2014-2019 maturities€ million - June ‘14

2.7673.752

986

Total cash Undrawn lines Total liquidity

Liquidity position€ million - June ‘14


2014 Overview (up to June)

Financial

Credit rating upgrade by Fitch (from BBB- to BBB)

10y corporate bond issued in July (coupon 2.5% )

€1.6bn Net cash* / €3.8bn Liquidity

Highest ever backlog, €26bn (Construction & Services)

Volume and profitability expansion (Services)

Traffic growth across the portfolio

Operations

Active pipeline in greenfield projects

Investment to grow

Financial discipline to invest

Future

Group Services largest division by revenues, EBITDA and OCF


Spain 2014

Traffic Ausol I

201 211

146120 113

2010 2011 2012 2013 1H 2014

… Better traffic

… Higher volumes(Services)

… Better collections(Services)

Tons

Days of sales outstanding

Waste

-16,2% -6,6%

6,6%

1H'14 1H'13 1H'12

-17,6% -9,8%

4,2%

1H'13 FY 2013 1H'14

public bidding in Spain

3,7

6,6

1H'13 1H'14

€ bn +76%

… Higher public bidding


Agenda

Group overview

Looking Ahead

Appendix






Capital allocation. Strong financial discipline

FinanciallyLow level of corporate

debt

Asset rotation to support growth

Efficient asset

allocation

Operationalvalue

generation

Operationally


2009 2010 2011 2012 2013

Shareholder remuneration

Interim (paid Dec’13) 0.40

FER Flexible Dividend 0.291

TOTAL 0.691

(Euros/share)

0.40 0.42 0.45

1.25

0.691

Dividend evolution

Dividend 2013


Net cash position(2018 & 2021 main maturities)

Highest everDividend generation

17%34%

13% 14%

Strong Backlog

Operatingcash flow*diversification

Solid FinancialPosition

High Quality Assets

Why Ferrovial?

22%

*2013 OCF ex-infrastructure projects


Thanks


Agenda

Group overview

Looking Ahead

Appendix






7.5 7.3

7.2

18.8

2005 1H2014

Services

Construction

Record Backlog (Construction & Services)

(€bn)

International

26.1

14.7

+78%

38% 68%

34%

66%Domestic

International

29%

71%

Domestic

International

€26.1bn (38 months of activity)

Construction

Services

Backlog growth


Toll roads

� Traffic growth across our portfolio Solid growth in US, Canada and Europe (Ireland, Portugal and Spain)

� Very active pipeline Bidding in US/ Australia/Canada and selective monitoring of opportunities in other markets.

� New projects awarded I77, North Carolina, US (Managed Lanes)

� Opening of NTE “Managed Lanes” (dynamic tolling)

2 - Equity method, *Ausol I Traffic

1H 2Q

Ausol* (Spain) +1.8% +4.2%

Algarve (Portugal) +11.2% +14.6%

M4 (Ireland) +4.4% +4.7%

ETR 4072

+3.8% +4.3%

Chicago skyway2

-1.4% +1.6%

1H 2014 ∆% L-f-L

Traffic evolution


� Traffic and EBITDA above expectations

� No relevant maturities until 2015

� 30y bond issuance CAD250mn in May 2014 (3.35% coupon)

� Increasing dividend (CAD525m 2014 ytd)

407ETR (Equity method, FERROVIAL stake: 43%)

Revenues414 +11.3%

EBITDA 345 +10.0%

EBITDA % 83.5% -110bps

Net debt 5,759 +8.76%

408

665

2007 2008 2009 2010 2011 2012 2013

190300

460600

680

2009 2010 2011 2012 2013

CAD million

407ETR

Resilient performance (EBITDA)CAD million

DividendCAD million

1H2014 ∆% LfL


Revenues 2,125 +25.7%

EBITDA 158 +11.6%

EBITDA % 7.5% -80 bps

Backlog 18,841 +3.6 %

Services

+37%

+58%

+5%

+10%

-12%

+1%

Revenues

EBITDA

BACKLOG

L-f-L

UK Spain

� Largest division in the group

� Strong revenue growth in Spain & UK (combined organic growth +8.6%)

� Enterprise integration on trackSynergies 2015 (e) £40mn

� Volume and profitability expansion

� New all-time high in backlog

� Selective M&A

SpainUK

65% 34%Other 1%

* Excluding forex impact, integration and restructuring costs.

€ million

Services

Performance by Geography

Backlog by geography

1H2014 ∆% LfL


Amey -profitable growth

0.7

1.2

2007 2012

CAGR: 9.7%

7

35 40

7.5

11.2

2012 2013

£ billion

1619

Synergies

Net

Costs

-9 +16 +40

19% organic growth

12.3

14.6

2011 2013

CAGR: 9%

Amey/Enterprise active bids

2011 date includes Enterprise’s bids

£ million

2013 2014 (e) 2015 (e)

2013: Enterprise synergies on trackProven organic growth

Backlog: anticipating future growthUK Services market is growing

Amey Sales

€ billion


Spain: resilient operations & financial performance

1.39 1.42

2007 2013

Stability

1.33 1.37

EBITDA OCF

5.2

6.3

2012 2013

Acumulative 2007 - 2013

34.2

24.7

2007 2012

-28%

Source: Presupuestos anuales de las Entidades Locales –Ministerio de Hacienda y Administraciones Públicas

Sales€ billion

100% EBITDA / Cash flow conversion

Local government operating spend Backlog: Anticipating future growth

€ billion

€ billion € billion


Construction

� No global or volume ambitions

� Competitive tool for infrastructure

projects

2014 (H1):

• Improvement in Cash Flow

•New contracts to be included in the next few

months, worth c.€1.1bn

• International growth to partially offset Spanish

decline

•Poland - Infra roads plan 2014-19, €10.0bn

•Spain – Higher Public bidding (+76%)

DomesticInternational

71% 29%

-191

-41

1H 2013 1H 2014

Operating Cash Flow

Backlog by geography

España29%

USA35%

Polonia13%R.Unido

6%

Chile5%

Canadá3%

Otros9%

€ million


Heathrow 35.1 +1.9%

Scotland 5.3 +8.2%

Southampton 0.8 +5.7%

Total HAH 41.1 +2.5%

HAH (Equity method, FERROVIAL stake 25.0%)

Revenues 1,319 +7.2%

EBITDA 710 +12.1%

EBITDA % 53.8% +230 bps

NET DEBT 13,129 +3.5%

� Terminal 2 at Heathrow (The Queen’s

Terminal) was opened to traffic on 4 June.

� Heathrow’s proposal for third runway

shortlisted for further analysis (Airports

Commission)

� Highest ever passenger satisfaction

2014 (H1)

• Double digit EBITDA growth

• Heathrow: traffic up 1.9% driven by

intercontinental demand

(PAX million)

100% GBP million

25.00% 20.00% 13.29% 11.88% 10.0%11.18% 8,65%

Ferrovial Qatar Brittania GIC CICAlinda USS

HAH

1H2014 ∆% LfL

1H2014 ∆% LfL

Traffic

Shareholders


Heathrow - Best ever passenger satisfaction

63%

81%

2007 1H 2014

40

19

2007 1H 2014

48%

79%

2007 1H 2014

Over 79% of passengers surveyed rated their experience as

Excellent or very good

Missed bags per 1,000 passengers

% passengers rating Heathrow “Excellent” or

“Very good”

Departures punctuality


JUN’14 Var%

4,159

435

10.5%

-120

315

7.6%

0

-167

49

197

-52

146

-

23

168

11.5%

4.8%

4.3%

Construction

Airports

Toll Roads

Services

Others

Total

1,804

3

200

2,125

28

4,159

1,859

4

206

1,655

8

3,732

-3.0

-21.3

-3.0

28.4

258.4

0.7

-21.3

-2.3

25.7

245.3

12.5

Construction

Aeropuertos

Toll Roads

Services

Others

Total

153

-7

123

158

8

435

154

-6

125

138

4

415

-0.9

-9.7

-1.8

14.7

108.1

4.8

-0.1

-14.7

3.0

11.6

-38.5

3.5

JUN´14 JUN´13 VAR.% LfL%

3,732

415

11.1%

-113

323

8.7%

0

-186

180

318

-51

267

-

20

287

JUN’13

Construction backlog

Services backlog

Traffic evolution

ETR-407 (VKT)

Chicago Skyway (ADT)

Indiana Toll Road (ADT)

Ausol I (ADT)

Ausol II (ADT)

M4 (ADT)

Heathrow (million passengers)

VAR%

7,297

18,841

JUN´14

1,145,192

37,755

25,854

10,315

12,764

25,653

35.0

7,867

17,749

JUN´13

1,103,360

38,288

25,765

10,132

12,707

24,562

34.0

-7.3

6.2

VAR%

3.8

-1.4

0.3

1.8

0.5

4.4

1.9

JUN´14 DEC´13

LfL%

12.5%

3.5%

2.2%

1H 2014 results

EUR MN

Revenues

EBITDA

EBITDA margin

Period depreciation

EBIT

EBIT margin

Disposals & Impairments

Financial results

Equity-accounted affiliates

EBT

Corporate income tax

CONSOLIDATED NET INCOME

Discontinued operations

Minorities

NET INCOME ATTRIBUTED

Income Statement Revenues

EBITDA

Operating Indicators

JUN´14 JUN´13 VAR.% LfL%


Agenda

Group overview

Looking Ahead

Appendix






775 1,937

-1,694 5,759

CAN million

Accountinglosses

Highdebt

1999:

27x Debt/Ebitda

1999

2013

407 ETR

Would you buy this company…?

Shareholder’s Equity Net debt


Strong dividend flow

Equity valuation sharp increase

Initial equity investment (62%) (326mn)

Dividends (00 - 13) 1,051mn

10% disposal 640mn

NET CASH IN 1,691mn

2,098

100% pay-backin first 10 years

Valuation x20

* June ’14 analysts consensus

525

10.485

1999 2014 Jun

20x

407 ETR

84 years to maturity

407 ETR

Ferrovial bought this company…

€ million

Cash Generation(1999-2013)

Valuation(100%)

€ million

Maturity


High density population area

Ring road of Toronto108 km

407

407

East extension

Area of expansion

407 ETR

Location


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 taken at entry and exit and

invoices posted to registered car owner

� Tolls billed monthly


407 ETR

LOCATION

Greater Toronto Area

23% of Canada

population

TRAFFIC

Alternatives routes

are highly congested

HIGH HOUSEHOLD INCOME

46% higherthan Canada average

NO REGULATORY

REVIEWS

During concession

life (99 years)

SPEED

Alternatives routes

40kph vs 100kph at

407

NON-STOP TOLL FACILITY

Fully electronic with interchangesevery 3km

TOLL RATE HIGH

FLEXIBILITY

Including segment,

direction, time of

the day

FAST

Reliable travel times

Fast

Safe

Reliable


420

801

2005 2013

316

665

75%

77%

79%

76%

80% 82%

83%

2005 2013

27

8.4

1999 2013

85145 120 135

190

300

460

600

680

2005 2006 2007 2008 2009 2010 2011 2012 2013

49

9790

38

72 7788

70 74

2005 2006 2007 2008 2009 2010 2011 2012 2013

84 years to maturity

100% pay-back in first 10

years

Free-tariff revision

≅ 8% CAGR 02-13*

* Tariff increase for light Vehicles in Peak hours regular zone (%)

CAGR: 8.4%

CAGR: 9.7%

104

136

2005 2013

CAGR: 3.4%

EBITDA %

407 ETR

Financial overview ($CAD million)

Revenues

EBITDA

OPEX

Capital Expenditure

Dividends

Net Debt / EBITDA X


300

200

500

300

400

300

350

400

200 200

2009 2009 2010 2010 2010 2010 2011 2012 2012 2013

10 11

510

287311

14 14

313

184

2013 2014 2015 2016 2017 2018 2019 2020

3,49%3,58%

1,58%

1,70%

1,56% 1,60%

1,39%

3

5

9

30 30

4039

2009 2009 2010 2011 2012 2012 2013

Maturity

Spread

years

407 ETR

ETR Recurrent presence in the bond market (June’13)

Extending maturities at historically low cost CAD 2,950mn issued since 2009

Yearly avg maturity: Only 3% of total debt


Agenda

Group overview

Looking Ahead

Appendix






A solution to congestion on “existing urban corridors”

Active management of “newly added capacity” through tolling

by means of

Free

Lanes

Free

Lanes

Tolled Lanes

Speed >50mph

“Express Tollway within an Existing Highway”

Managed Lanes

New assets landmark


Time of the day

Eastbound

Westbound

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

Peak period

Managed Lanes

Level of demand

NTE (untolled) 407ETR (tolled)


Tim

e (

min

)• Free flow time of 14 minutes at 6.00AM

• The average travel time during all time periods is significantly higher

• In some periods, the average travel time is double the free flow speed and can go up to almost 50 – 60 minutes

0

10

20

30

40

50

60

70

NB AM NB MD NB PM SB AM SB MD SB PM

Travel Time Variability

Tim

e (

min

)

Data Source: Travel Time Runs Seg 3a and 3b conducted Fall 2012

Paying for predictability

Free Flow Travel

Mean

NB - North bound SB - South bound

Travel time variability


Toll rates – tariff treshold

Toll Rate Cap 0.75 c/mi

Demand threshold 3300 pce/h

2-lane sections

Speed Threshold 50 mi/h

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 TOTAL FREEDOM Freedom under the cap

Speed

Demand

Toll Rate

Tariff treshold


NTE

3

NTE 1-2

LBJ

Dallas and Fort Worth Regional Map

Managed Lanes regional map


CINTRA MERIDIAMDALLAS

FIRE&POLICE

PENSION SCHEME

Key characteristics

108Km

Electronic toll

DESCRIPTION:

LENGTH:

CONCESSION PERIOD:

TARIFF POLICY:

IH 635 (Dallas County), the most populous county in Texas

13 mile section of the IH 635 and IH 35E

52 years

Open Road Tolling System (no toll booths) with a dynamic

tolling regime (every 5 minutes) to maintain at all times a

minimum speed of 50 mph

● Heavy congested area, almost 250,000 cars per day

● No toll-booths, fully electronic free flow tolling

system

● Tollway within a freeway: Motorists will be provided

with a choice of driving in non-tolled GP lanes or

paying a toll to bypass such GP lanes

● Tolls setting to ensure minimum speed on new lanes

● As demand grows and capacity becomes scarce,

pricing power increases

● Physically separated from the GP lanes with

controlled access

EQUITY DEBT PUBLIC FUNDS

Managed Lanes

Lyndon B Johnson

51% 42% 7%

25% 54% 20%

Shareholder structure

Financial structure



FIRE&POLICE

PENSION SCHEME

DESCRIPTION:

LENGTH:

CONCESSION PERIOD:

TARIFF POLICY:

Dallas-Fort Worth Metroplex, Major thoroughfares

between Fort Worth and DFW Airport

13 mile section (IH 820 & SH 183 in Tarrant County)

52 years




● Heavy congested area, almost 200,000 cars per day

● No toll-booths, fully electronic free flow tolling

system








controlled access


Managed Lanes

North Tarrant Express

57% 33% 10%

21% 52% 27%

Key characteristics


Financial structure


50% 14% 10%


FIRE&POLICE PENSION SCHEME

DESCRIPTION:

LENGTH:

CONCESSION PERIOD:

TARIFF POLICY:

2 “managed lanes” in each direction of the IH-35W, segments

3A and 3B (3B segment to be built by TxDOT)

10.2 mile section (segments 3A 6.2 miles and 3B 4 miles)

48 years




● The corridor south to the 3A segment is currently

ranked as the most congested roadway in Texas.

● No toll-booths, fully electronic free flow system








controlled access

32% 59% 9%


APG

Managed Lanes

North Tarrant Express 35W

26%

Key characteristics


Financial structure


• First privately-financed roaddevelopment project of its kind toreach financial close in 2010.

• Texas’ third big recent road projectto reach financial close since 2008.

• First combination of TIFIA and taxexempt PABs.

• First un-wrapped bond issuance fora toll road.

• First time TIFIA allowed additionaldebt to be raised beyond itsapproved federal subsidy cap.

• First time that a U.S.-based pensionfund made a direct investment in ahighway concession.

21%

52%

27%

25%

54%

20%

Figures in US Dollars

Managed Lanes

Financial Overview

32%

59%

9%

• Very competitive capital structurein spite of the difficult marketconditions.

• Strong portion of the debt fromTIFIA program with its flexibleamortizing structure during thefirst 25 years.

2.05 bn

427 m

243 m (57%)141 m (33%)43 m (10%)

1,050 m

400 m650 m

537 m

2.70 bn

665 m

339 m (51%)282 m (42%)44 m (7%)

1,465 m

615 m850 m

496 m

1.36 bn

430 m

215 m (50%)167 m (39%)43 m (10%)4 m (1%)

805 m

274 m531 m

127 m

Total Investment:

Private Equity:

Cintra: Meridiam: DPFPS:APG:

Total Debt:

PABs:TIFIA:

Public Funds:


Agenda

Group overview

Looking Ahead

Appendix






DEC’13 Var%

8,166

934

11.4%

-233

701

8.6%

126

-333

375

869

-168

701

26

727

7.0%

0.8%

-1.0%

Construction

Toll Roads

Services

Others

Total

4,063.6

429.0

3,656.3

17.6

8,166.5

4,325.6

381.4

2,895.0

28.3

7,630.3

-6.1

12.5

26.3

n.s.

7.0

-4.5

13.0

29.3

n.s.

9.0

Construction

Toll Roads

Services

Others

Total

342.8

276.3

321.5

-6.3

934.3

336.9

271.6

313.4

4.6

926.6

1.8

1.7

2.6

n.s.

0.8

4.0

2.9

15.0

n.s.

4.8

DEC´13 DEC´12 VAR.% LfL%

VAR.% L-f-L%

7,630

927

12.1%

-219

708

9.3%

52

-301

275

733

-106

628

64

692

DEC’12

Construction backlog

Services backlog

Traffic evolution

ETR-407 (VKT)

Chicago Skyway (ADT)

Indiana Toll Road (ADT)

Ausol I (ADT)

Ausol II (ADT)

M4 (ADT)

Heathrow (million passengers)

VAR%

7,867

17,749

DEC´13

2,356,343

41,251

27,924

11,307

13,629

25,591

72.3

8,699

12,784

DEC´12

2,340,004

42,228

27,459

12,537

14,099

25,306

70.0

-9.6

38.8

VAR%

0.7

-2.3

1.7

-9.8

-3.3

1.1

3.4

DEC´13 DEC´12

DEC´13 DEC´12

L-f-L%

9.0%

4.8%

4.0%

FY 2013 results

EUR MN

Revenues

EBITDA

EBITDA margin

Period depreciation

EBIT

EBIT margin

Disposals & Impairments

Financial results

Equity-accounted affiliates

EBT

Corporate income tax

CONSOLIDATED NET INCOME

Discontinued operations

Minorities

NET INCOME ATTRIBUTED

EBITDA

Operating Indicators

Income Statement Revenues


Dividends

From infra projects 45%

Operating Cash Flow

Construction+Services

48%

Investment flow

20%

Cash Flow generation 2013

32% 14%21%

12%RoW

7%RoW

66%

Ex-Infrastructures projects

22% 11%RoW


(1) Proportional: All EBITDA figures are aggregated in a proportional basis to the Ferrovial equity stake in each company or project.

Diversified portfolio

Services Construction Toll Roads Airports

Non Capital Intensive

PROFIT GENERATION

CASH GENERATION

Fully consolidated Method

€934MnProportional (1)

€1,681Mn

Capital Intensive

LONG DURATION

LONG TERM VALUE

EBITDAFY´13

Services

Toll Roads

Construction

Airports

33%

37%

30% 20%

29%19%

32%

41%Spain

17%UK

17%US

25%RoW

22%Spain

43%UK

24%US

11%RoW

Ex – Infrastructure Projects Infrastructure Projects

INVESTOR RELATIONS DEPARTMENT - C/ Príncipe de Vergara, 135 - 28002 MADRID (Spain)T: +34 91 586 27 30 F: +34 91 586 28 69 e-mail: [email protected]

website: www.ferrovial.com

ferrovial

ferrovial: investor presentation jan jun 2014 | presentación inversores ene jun 2014

Investor Relations