Good morning, ladies and gentlemen. Joaquín Ayuso. Chief Executive Officer

Transcription

1 Good morning, ladies and gentlemen. Joaquín Ayuso Chief Executive Officer

2 Ferrovial Cash flow: 650 Construction 270 Infrastructure 136 Services 187 Real Estate 17 Corporation 41 Year-end cash position: 139 million euro As the Chairman described earlier, Ferrovial ended 2004 with record earnings and, in particular, superb cash flow in terms of both the amount, 650 million euro, and its origin: for the first time, 50% of operating cash flow was generated by the company's less cyclical activities: Infrastructure and Services. As a result of this cash flow figure, the company ended the year with 139 million euro in net cash despite having made sizeable investments in the last two years, mainly in the Services division. I will now discuss the 2004 results. I will describe each business area individually, without returning to the overall figures which the Chairman has already analysed.

3 Ferrovial - Lines of business Revenues: 7,268 EBIT: % 33% 19% 21% 49% 8% 22% 38% Construction Infrastructure Services Real Estate Ferrovial is involved in four main lines of business: Construction, Infrastructure, Real Estate development, and Services. As you can see in the figure, revenues totalled billion euros and Construction is still the main contributor, accounting for nearly 50% of that figure. Following the acquisitions in 2003, Services is now the second-largest contributor, with 33%. However, Infrastructure is the main contributor to EBIT, with 38%, and Services makes a sizeable 21% contribution. As the Chairman mentioned earlier, these two less cyclical areas accounted for nearly 60% of the company's EBIT: Moreover, we have maintained our presence in telecommunications via a 9.6% stake in cable operator ONO, though our approach is more financial rather than seeking to participate in management.

4 Ferrovial: Net profit D% Construction % Real Estate ,0 7.6% Infrastructure % Services % Other Total % million euro Ferrovial net profit Eliminating the extraordinary results on the Cintra IPO, net profit increased by 16.1% on All areas contributed positively to this growth; Construction reported million euro in net profit, i.e. 5.2% more than in Real Estate increased net profit by 7.6% to 66.7 million euro. Infrastructure profit increased from 71.4 million euro to 75.9 million euro, a 6.3% increase. Services increased profit by 511% to 58.7 million euro, mainly due to the fullyear consolidation of Amey and Cespa.

5 Construction - Key figures Net revenues , D% 3, % EBIT % EBIT margin 4.7% 4.7% Cash flow Work completed pending certification 26 days 26 days million euro Construction - Key figures Construction revenues in 2004 were similar to 2003, at billion euro. International activity increased by 7%, offsetting a 3% decline in activity in Spain. EBIT increased by 1% on 2003, to million euro and the EBIT margin was stable at 4.7%. If we exclude the figures for Budimex, our Polish subsidiary, EBIT increased by 4.6% and the margin was 5.6%, compared with 5.3% in Operating cash flow was again sizeable, at 270 million euro. Work executed pending certification, which reflects sales recognised as revenues but not yet billed to customers, is still under one month, reflecting our conservative approach to recognising profit.

6 Construction backlog 6,106 10% 6, months production million euro Construction backlog 2004 The backlog, one of the main indicators of future activity in this business, totalled billion euro, 10% more than at 2003 year-end, and represents 23 months' production.

7 Construction backlog 2004 Industrial Residential building Civil engineering 12% 17% 53% 18% Non-residential building 25% International (80% Europe) Spain 75% Backlog by segment and region Breaking the backlog down by segments reveals the following: 53% is civil engineering, 17% residential building, 18% is non-residential building, and 12% industrial building. Spain accounts for 75% of the backlog. The international backlog is billion euro, with 80% of that in Europe : Poland, Portugal, Ireland and Italy.

8 Business in Poland D% Backlog % Net revenues % Eastern Europe is taking off Poland Budimex consolidated its leading position in the Polish market in 2004 by presenting a large number of bids and increasing its construction backlog by close to 52%, from 407 million euro to 617 million euro. Budimex attained 489 million euro in revenues, a 2.3% increase. Though later than expected, all the economic and investment indicators for Eastern Europe, and Poland in particular, point to strong growth in 2005 and 2006;with the arrival of European Cohesion and Development funding, this will be one of the areas with the greatest potential. We expect this boom to be reflected in group earnings from 2006 onwards.

9 Future - Construction Strong backlog Sustained investment in Spain: Government Transport Infrastructure Plan Expanding international presence The future of construction Our strong backlog, sustained investment in Spain due to the ambitious new Strategic Transport Investment Plan, which envisages investing 241 billion euro between 2005 and 2020, plus a growing, but selective and profitable, international presence give reason to look to the future with optimism.

10 Infrastructure Total investment: 2.2 billion euro Europe 40% 16% Chile 8% Australia 20% 17% Canada USA Toll roads 17 1,700 km in length Airports 4 35 million passengers Car parks Over 200,000 spaces Infrastructure Ferrovial is one of the world's largest infrastructure developers in the private sector, with committed investment of over 2.2 billion euro. In this area, it operates toll roads, develops and operates car parks, and manages airports. The first two activities are conducted through Cintra. With over 35 years' experience in this area, Ferrovial currently manages 17 toll roads measuring over 1,700 kilometres in 6 countries; 4 airports, which together handle 35 million passengers each year; and over 200,000 parking spaces. 78% of the business is concentrated in toll roads; by region, 40% is in Europe, 20% in Canada, 17% in the United State, 16% in Chile and 8% in Australia.

11 Infrastructure - Key figures Net revenues D% % EBITDA % EBITDA margin 62.1% 60.5% million euro Infrastructure - key figures This area continued to progress in 2004, boosting revenues by 17.3% to 614 million euro; EBIT increased by 20.4% to 381 million euro, and the EBITDA margin was 62.1%.

12 Infrastructure - Toll roads D% Net revenues % EBITDA % EBITDA margin 56.7% 56% We have entered the US market Award of Ocaña-La Roda Two toll roads (Spain and Portugal) became operational, and our stake in Ausol increased Toll road revenues amounted to 453 million euro, a 16.5% increase on EBITDA increased by 19.4% and the EBITDA margin was 56.7%. In addition to the Cintra IPO, mentioned earlier by the Chairman, there was another major event in this Division's development. In the fourth quarter of 2004, we entered the US market by landing two important contracts: - the Chicago Skyway - and our election as strategic partner for the State of Texas in the development, over the next 50 years, of one of the largest infrastructure projects ever undertaken there: the Trans-Texas Corridor project. Other major operations include: - award of the OcaÒa-La Roda toll road; - the opening of two new toll roads: the R-4 in Spain and Scut Algarve in Portugal; - and the increase in our stake in Ausol to 85%.

13 Infrastructure - Airports D% Net revenues % EBITDA EBITDA margin % 38.1% 38.7% Superb operating performance Strong cash flow Note: Sydney airport is equity-accounted Airports performed positively in terms of traffic, which was reflected in revenues reaching 60 million euro, 30.2% more than in 2003, with EBITDA amounting to 22.8 million euro, i.e. 28.2% more. Sydney airports, whose figures are not included as it is equity-accounted, obtained 338 million euro in revenues, a 14% increase, with EBITDA of 273 million euro, 20% more than in Ferrovial owns 20% of Sydney airport. The number of passengers using our airports increased by 12% at Sydney, 20% at Bristol and 6% at Belfast. These investments made a notable contribution to Group cash flow: 39 million euro. In just 2 years, Sydney has repaid 21% of the initial investment, while Bristol has already repaid 30%.

14 Infrastructure Car parks D% Net revenues % EBITDA EBITDA margin % 32.6% 29.5% 207,000 spaces under management Acquisition of another 57% of Eguisa Infrastructure - Car parks The car park area increased revenues by 14.1% in 2004, to million euro. EBITDA increased by 26% to 33 million euro. The EBITDA margin increased considerably, to 32.6%. Our growth strategy in this market has been very successful, and we now manage over 207,000 parking spaces in 128 cities in Spain. The acquisition of another 57% of Eguisa, one of Spain's main car park operators, added 4,000 spaces.

15 Real Estate - Key figures Net revenues D% % EBIT % EBIT margin 19% 18.2% million euro Real Estate development In 2004, Ferrovial's Real Estate division continued along the lines of previous years, based essentially on controlling risks. Revenues increased by 5.4% to 768 million euro, and EBIT increased 10% to 151 million euro. The EBIT margin rose to 19%, from 18.2% in 2003, as a result of cost controls.

16 Real Estate backlog and land bank 2004 Real Estate backlog Land bank (building space) Investment in land 999 million 1.3 million m million Real Estate backlog and land bank in 2004 At 2004 year-end, we had 999 million euro, assuring a large proportion of the revenues in 2005 and subsequent years. The land bank amounted to 1.3 million m2 of potential building, assuring activity until In 2004, land worth 213 million euro was acquired.

17 Real Estate Key events 2004 Homes sold Homes delivered Homes brokered (Don Piso) 2,408 3,873 3,243 Real Estate. Key events 2004 During the year, the Real Estate areas sold 2,408 homes and delivered 3,873 homes. The realty brokerage business, conducted through Don Piso, continued to expand, opening new company-owned and franchised outlets to make a total of 314. This unit brokered the sale of 3,243 homes. First home development is still our main product in this market and we maintain our industrial approach to the business and our plan to expand marketing channels so as to achieve rapid turnover.

18 Services - Key figures Net revenues , D% 1,358 81% EBIT % EBIT margin 6.6% 5.2% In two years, revenues have increased 7-fold and EBIT 9-fold million euro More stable and international profile Services - Key figures As you know, in 2003 Ferrovial undertook a sweeping transformation of the Services division through the acquisition of two companies: urban and industrial waste management company Cespa, and UK infrastructure maintenance and facility management company Amey. In 2004, we worked to consolidate and integrate these two companies, with results that exceeded our expectations: revenues in this areas increased by 81%, with EBIT up 126.7%, and the EBIT margin increased notably to 6.6%, from 5.2% in In just 2 years, Ferrovial has multiplied revenues seven-fold and EBIT ninefold, creating a business profile with a more stable bottom line and a greater international footprint.

19 Services backlog 5,177 4,973* 57% outside Spain million euro * Does not include the 15 billion backlog in London Underground Services backlog At 2004 year-end, the backlog amounted to billion euro, i.e. slightly less than the billion euro registered in 2003 due to the sale of the water business in the second half of 2004 and the effect of insourcing of railway maintenance contracts by the UK government. However, this figure does not include the backlog in the London Underground maintenance contract, which represents over 15 billion euro over the next 28 years. Of the total Services backlog, 57% is in contracts in other countries, principally the United Kingdom.

20 Services - Amey Net revenues , ** D% % EBIT % EBIT margin 5.4% 4.4% Backlog * 2,822 2,780 2% million euro * Does not include the 15 billion backlog in London Underground ** figures for 7 months in 2003 Services - Amey Full-year consolidation of Amey greatly improved all line items. Amey's revenues totalled billion euro, 73% more than it contributed in EBIT increased by 113.7% to 75 million euro, and the EBIT margin increased substantially, from 4.4% to 5.4%. The backlog amounts to billion euro. In December, Amey reached an agreement with Jarvis to acquire its 33% stake in Tube Lines, the company that manages and renovates three lines of London Underground: a total of 100 stations, 335 km of track which carry over 1.75 million passengers every day. This acquisition, which was completed in February, strengthened Amey's position in this contract to 66%.

21 Services Spain Net revenues , D% % EBIT % EBIT margin 8% 6.5% million euro Services - Spain Because of integrating Cespa, services revenues in Spain reached billion euro, a 93% increase, and EBIT increased by 139% to 87 million euro. The margin also increased significantly, to 8% (from 6.5% in 2003).

22 Services - Spain Urban services Serving 800 municipalities with over 5 million inhabitants Maintaining 29 million m 2 of green areas Managing over 2 million tonnes of waste Facility management 2,700 buildings, over 4.4 million m 2 Infrastructure maintenance 7,500 km of roads Services - Spain Adding Cespa expanded and consolidated our presence in the urban services market in Spain. This area serves close to 800 municipalities with over 5 million inhabitants; it maintains 29 million square metres of garden; and it manages over 2 million tonnes of waste. Ferrovial is now one of the leading players in the facility management market: in Spain alone it manages 2,700 buildings with over 4.4 million square metres, including hospitals, museums, universities, prisons, and shopping centres. The infrastructure maintenance area maintained over 7,500 kilometres of road in 2004.

23 Telecommunications 9.5% stake Total investment: 95 million euro Acquisition of Retecal, cable operator in Castilla León % Revenues million 40% EBITDA million 80% Customers 800,000 Telecommunications In telecommunications, we maintain our 9.6% stake in ONO, one of the leading broadband operators following its acquisition and integration of Retecal, the Castilla & LeÛn cable company. Our stake cost a total of 95 million euro. ONO is performing very well, having increased revenues by 40% in 2004 to 502 million euro and attained 185 million euro in EBITDA, 80% more than in In 2004, ONO added 100,000 clients and ended the year with over 800,

24 Annual Report At the beginning of the meeting, each of you received a copy of the 2004 annual report. The annual report contains the information we consider to be necessary about the Ferrovial Group in its current configuration, its activities, business strategies, economic, social and environmental commitments, and its corporate governance rules. It is a compilation of what we have done and want to do so as to consolidate a business model focused on sustained, profitable value creation. Conclusions and acknowledgements Ladies and gentlemen. Based on clear, solid strategy, we have invested in a number of businesses and regions, resulting today in an international, diversified group, and these are the foundations on which we will build the company's future. Solid backlogs in all our businesses, a very strong balance sheet and a good position in international markets enable us to look to the future with optimism and undertake a new phase of consolidation and growth. With the support of our shareholders, the trust of our clients and suppliers and the hard work and skill of the 50,000 people working at Ferrovial will enable us to continue improving our results and establish Ferrovial as a benchmark in the infrastructure and services market. Thank you very much.