January - March 2016 Results Ferrovial, S.A. and subsidiaries

Transcription

1 January - March 2016 Results Ferrovial, S.A. and subsidiaries 4 May 2016

2 INDEX January March 2016 Results. Ferrovial S.A. and subsidiaries INDEX... 2 GENERAL OVERVIEW... 3 BUSINESS PERFORMANCE... 3 TOLL ROADS... 4 ASSETS IN OPERATION... 4 FINANCIAL ASSETS...5 ASSETS UNDER DEVELOPMENT...5 REFINANCING OF PROJECTS...5 PROJECTS TENDERED...5 ASSETS IN INSOLVENCY PROCEEDINGS... 6 AUTEMA... 6 M3 & M4 TOLL ROADS... 6 CHICAGO SKYWAY ETR... 7 NTE... 8 LBJ... 8 SERVICES... 9 SPAIN... 9 UK... 9 INTERNATIONAL ORDER BOOK M&A CONSTRUCTION BUDIMEX WEBBER FERROVIAL AGROMAN ORDER BOOK AIRPORTS HEATHROW HAH UK REGIONAL AIRPORTS (AGS) BALANCE SHEET CONSOLIDADATED PROFIT & LOSS ACCOUNT NET DEBT AND CREDIT RATINGS NET DEBT CREDIT RATINGS EX-PROJECTS DEBT MATURITies SHAREHOLDER REMUNERATION DIVIDENDS...18 SHARE BUY-BACK AND CANCELLATION...18 SHAREHOLDING STRUCTURE ANNEXES I: SIGNIFICANT EVENTS II: EVENTS AFTER THE CLOSE II: PRINCIPAL CONTRACT AWARDS III: EXCHANGE-RATE MOVEMENTS

3 GENERAL OVERVIEW The 1Q 2016 results were marked by strong traffic growth at Ferrovial s airports and toll roads, substantial contract awards to the Construction division, the refinancing of Ausol, the closure of the sale of the Chicago Skyway and the Irish toll roads and the Group s financial flexibility, which maintained its net cash position ex-infrastructure projects at EUR1,512mn. The accounting results reflected the negative impact of sterling and zloty movements against the euro. In like-for-like terms, revenues increased by +0.4% and EBITDA fell by -2.8% vs. the declines in reported revenues and EBITDA of -3.0% and -7.4% respectively. Net profit increased by 32.3% to EUR157mn. In more detail: The combined order book of Construction and Services reached over EUR30,000mn (including JVs), remaining flat (-0.3%) vs December 2015 excluding the FX impact. Ferrovial won new contracts in its core markets (the US, Poland and the UK). We highlight the construction of a section of the High Speed Train in California, the Olstyn beltway in Poland and the maintenance of 370kms of roads in the UK. February 2016 saw the closure of the toll road disposals agreed in 2015: - Chicago Skyway: Sale to a consortium of Canadian pension funds (55% attributable to Cintra), which implied net capital gains of EUR110mn. - Irish M4 and M3 toll roads: sale of a stake in each to DIF, a Dutch fund, for EUR61mn (with a net capital gain of EUR21mn). Ferrovial will maintain a 20% stake in each concession. In March, Ausol s debt was refinanced, by means of: - Bonds & obligations issued for a total of EUR507mn (3.75% coupon, 30 years), with a BBB rating. - Subordinated bank debt of EUR51mn (fixed 7% cost), at 10 year, extendible up to 30 years. The 407ETR toll road and Heathrow Airport repeated the ordinary dividends paid in 1Q ETR paid CAD187.5mn and HAH paid GBP75mn. AGS distributed dividends of GBP9mn, although at end- March 2016, payment to Ferrovial had not yet been made (transaction date was on the first days of April 2016). The net cash position ex-infrastructure projects at end-march 2016 reached EUR1,512mn (vs. EUR1,514mn at end-december 2015). Consolidated net debt reached EUR4,647mn, including EUR6,159mn in concession projects, up from EUR6,057mn in December The financing for the Construction project of the I-285/SR 400 toll road (in Atlanta, USA) took place in April (investment of USD458mn). The bank financing (tax exempt for the creditor) is for a maximum of USD458mn, and matures up to This is the first PPP project of its type to use tax-free bank debt in the US. On 29 April, Ferrovial reached the minimum acceptance (50.01% of shares) to which the acquisition of the 100% of Australian company Broadspectrum was conditioned. The offer period was extended until 13 May On 4 May, the AGM approved the third Ferrovial Flexible Dividend programme, a programme that has been in place since The AGM also approved a share buy-back programme of up to EUR275mn or 19 million shares, for subsequent cancellation. At end-march 2016, Ferrovial had bought back 1,155,424 shares. BUSINESS PERFORMANCE Cintra: There were significant improvements in traffic on the Group s main toll roads, helped by the economic recovery, the calendar effect and the continuing decline in the oil price. Services: the results reflected the negative impact of sterling weakness. In like-for-like terms, revenues increased by +3.5% and EBITDA fell by -18.9%, mainly due to UK, with reduced local authority activity and losses in Birmingham related to legal expenses, which were partially offset by new contract awards in the Utilities sector. The order book contracted by -6.6% (-1.9% like-for-like). Construction: the profitability of the business remained in line with 1Q 2015 (EBITDA margin of 7.3%), in spite of the drop in revenues as a reflection of the completion of projects in the US and the weakness of the domestic market, which was not fully offset by the strength of Budimex. Note the expansion of the order book (+3.6% like-for-like) to EUR8,875mn (81% international). Airports: Heathrow reported record passenger traffic (+2.6%) in February and March, with more seats sold in larger aircraft and traffic growth to Europe, the US, Asia-Pacific, the Middle East and Latin America. Traffic in AGS increased +2.4% on average (Glasgow +12%, Southampton -2.4%, Aberdeen -14.7%). Strong operating results at equity-accounted assets: EBITDA +7.6% at HAH, +4.0% at AGS and +8.7% at 407ETR, in local currency terms. Mar-16 Dec-15 Var. Revenues 2,083 2, % 0.4% Construction order book 8,875 8, % EBITDA % -2.8% Services order book (Incl JVs) 21,291 22, % EBIT(*) % -6.3% Net result % Traffic evolution Mar-16 Mar-15 Var. Net debt Mar-16 Dec-15 ETR 407 (VKT 000) 534, , % Net Debt Ex-Infra Projects 1,512 1,514 NTE (ADT) 28,918 20, % Total net debt -4,647-4,542 LBJ (ADT) 26,603 7, % Ausol I (ADT) 11,698 10, % Heathrow (million pax.) % AGS (million pax.) % *Operating result before impairments and sale of fixed assets 3

4 TOLL ROADS Revenues % 19.1% EBITDA % 20.9% EBITDA Margin 63.9% 62.6% EBIT % 20.7% EBIT Margin 49.9% 43.7% Revenues at the Toll Roads division were very positive in the first quarter of 2016 (+4.6%, or +19.1% in like-for-like terms), thanks to the contribution of the LBJ toll road (the managed lane opened in its full configuration in September 2015, and thus only contributed for the partial segments in operation in 1Q 2015) and the traffic growth on the main toll roads. Additionally, note that both Chicago Skyway and the Irish toll roads, M3 and M4, contributed approximately two months in 2016 (until the closure of the sale processes on 25 February), compared with the first quarter of 2015, when they contributed for the full quarter. There was also strong growth at EBITDA level (+6.7%, or +20.9% in likefor-like terms), such that the EBITDA margin expanded to 63.9% vs. 62.6% in the first quarter of ASSETS IN OPERATION TRAFFIC PERFORMANCE Traffic performance was very positive in the first quarter on the majority of the Group s toll roads, with good performance in both light and heavy traffic. The main drivers of this trend were the economic recovery since the second half of 2014 (in the US, Canada, Spain, Portugal and Ireland), the calendar effect (the timing of the Easter holidays and a leap year) and the continued decline in the oil price since the start of By country: In Canada, traffic on the 407ETR increased by +0.8% in the first three months of the year, reflecting the economic growth and favourable weather conditions. In the US, note the positive traffic growth on the managed lanes toll roads, reflecting the better economic performance and the weather conditions. In Spain, the positive trend in traffic in place since the end of 2013 and at end-2015 continued in the first quarter of 2016, with traffic growth on all the toll roads. In 1Q 2016, traffic increased notably as a consequence of a positive calendar effect (the timing of the Easter holidays and an additional working day due to the leap year). Autema started 2016 with the introduction of a package of discounts on its tolls; traffic increased by +11.5%, continuing the positive trend observed in At Ausol I and II, average daily traffic growth continued in double digits (+15.2% and +12.2% respectively). There was solid traffic growth on the Portuguese concessions. The roadworks in the alternative route from the end of 2015 continued to favour traffic in Algarve, which increased by +28.5% (since December 2015, this toll road has been classified as a financial asset). In Azores, after storms in January, the weather was favourable in February and March, and the quarter closed with traffic growth of +6.6%. In Ireland, traffic growth has remained consistently positive on both toll roads since the downward trend reversed in the second quarter of 2013 as a reflection of the continued improvement in the Irish economy, and in particular in the country s employment levels. From 1 March 2016, with the closure of the sale of a stake in each of M3 and M4 toll roads in Ireland, both assets are integrated through Equity consolidation. Net Debt million Traffic (ADT) Revenues EBITDA EBITDA Margin 100% Global consolidation Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Mar-16 Share Intangible assets NTE 28,918 20, % % % 75.1% 67.5% % LBJ* 26,603 7, % 14 2 n.s n.s. 72.3% 20.7% -1,253 51% Ausol I 11,698 10, % % % 80.8% 75.1% % Ausol II 14,406 12, % M4** 27,576 25, % % % 68.2% 69.2% % Azores 8,399 7, % % % 82.8% 78.5% % Activos financieros Autema % % 92.4% 93.2% % M3** % % 76.8% 75.4% % Norte Litoral % % 88.2% 88.5% % Algarve % % 90.0% 88.7% % Via Livre % 0 0 n.s. 14.9% 0.9% 2 84% * LBJ: In September 2015 the LBJ toll road opened to traffic in its full configuration: up until then only two short sections were in operation (which explains why there are figures for this toll road in March 2015). ** M3 & M4: The figures in the above table for these two toll roads, in 2016, include them through Global Consolidation for January and February 2016, and through Equity Consolidation thereafter. 4

5 million Traffic (ADT) Revenues EBITDA EBITDA Margin Net Debt 100% Equity Consolidated Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Mar-16 Share Intangible assets 407 ETR (VKT'000) 534, , % % % 83.3% 80.6% -4,325 43% Central Greece 9,492 14, % % % 31.3% 43.0% % Ionian Roads 19,792 20, % % % 66.2% 72.7% 2 33% Serrano Park % 1 0 n.s. 62.2% 10.7% % Financial Assets A-66 Benavente Zamora % % 89.8% 26.3% % FINANCIAL ASSETS Under IFRIC 12, concession contracts can be classified in two ways: as either intangible assets or financial assets. Intangible assets (where the operator assumes the traffic risk) are those where remuneration comprises the right to charge the corresponding tariffs depending on the level of use. Financial assets are concession agreements where the remuneration comprises an unconditional contractual right to receive cash or other financial assets, either because the entity awarding the concession guarantees the payment of agreed sums, or because it guarantees that it will cover the shortfall between the sums received from the users of the public service and the said agreed amounts. In this type of contract, the demand risk is assumed by the entity awarding the concession. The assets in operation classified as financial assets, which bear no traffic risk due to some kind of guarantee mechanism are Norte Litoral, Eurolink M3, Autema, ViaLivre, A66 and Algarve. The latter concession was classified as a financial asset in October 2015, after an agreement with the Portuguese government under which the concession changed to being payment for availability (with no traffic risk). ASSETS UNDER DEVELOPMENT ASSETS UNDER CONSTRUCTION million Global Consolidation Invested Capital Pending committed capital Net Debt 100% Share Intangible Assets NTE 35W % I % Equity Consolidated Financial Assets East Extension I % 407-East Extension II % Ruta del Cacao % Toowoomba % REFINANCING OF PROJECTS AUSOL On 23 March 2016, Cintra closed the refinancing of the two sections of its Autopista del Sol toll road (Ausol I and Ausol II) in Andalusia (Spain). The total amount of the new financing structure, with no recourse to the shareholders, reaches EUR558mn and has allowed financial costs to be reduced and maturities to be extended to The structure comprises two tranches (both rated BBB with Stable Outlook by S&P): - Bonds and obligations issued for a total of EUR507mn (3.75% coupon, 30 years), with a BBB rating. - Subordinated bank debt of EUR51mn (fixed 7% cost), at 10 year, extendible up to 30 years. PROJECTS TENDERED Ferrovial continues to monitor development activity in its target international markets (North America, Europe and Australia) to bid for toll road projects. In Canada, Cintra has pre-qualified to bid for the extension and widening of Highway 427 in Toronto (Ontario) in On 28 January 2016, the consortium led by Cintra was selected by the Ministry of Transport of Slovakia as Preferred Bidder for the D4-R7 Bratislava beltway (in Slovakia). The project includes the design, construction, financing, operation and maintenance of the Bratislava beltway, with an investment of EUR1,010mn. The consortium also includes the Australian group Macquarie and the Austrian construction company Porr. Cintra will be responsible for the development of this (availability payment) project, with the design and construction carried out by the JV led by Ferrovial Agromán. NTE 35W: The financial close was achieved in September 2013 and the works are proceeding on schedule (47.01% complete); the toll road is expected to open to traffic in mid East Extension Phase I: Construction works began in March 2013 and the project is expected to open to traffic in the coming months. 5

6 ASSETS IN INSOLVENCY PROCEEDINGS SH130 On 2 March 2016, the concession company that manages the SH-130 toll road requested court protection against its creditors (Chapter 11). The Company hopes to be able to announce a resolution in the coming months. The SH-130 will continue uninterrupted operations while this process is being resolved. Traffic growth continues, rising by +17.6% in the first quarter of The toll road is still in the ramp-up phase, and an increasing number of motorists are becoming familiar with the route and choosing to use it. January March 2016 Results. Ferrovial S.A. and subsidiaries million Traffic Revenues EBITDA EBITDA Margin Net Debt 100% Intangible assets Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Mar-16 Share Global Consolidation SH-130 7,912 6, % % % -2.0% 43.9% -1,308 65% AUTEMA On 16 July 2015, the Catalonian Government official journal (Diario Oficial de la Generalitat de Cataluña) published the Decree 161/2015, of 14 July, which approved unilaterally the modification of the administrative concession of the Tarrasa-Manresa toll road. On 9 October, the Company laid a claim against this new Decree before the Catalonian High Court of Justice (Tribunal Superior de Justicia de Cataluña), which was admitted on 13 October. The new tariffs (discounts) corresponding to the new Decree have been applied since 4 January M3 & M4 TOLL ROADS In September 2015, Ferrovial (through its Toll Roads division Cintra) reached an agreement with the Dutch infrastructure fund, DIF, for the sale of 46% of the M4 and 75% of the M3, at a price of EUR61mn (implying a net capital gain of EUR20mn). The deal was closed in February 2016, since when the assets have no longer been classified as Assets Held for Sale. As a result of this transaction, Ferrovial now owns 20% of each concession, remaining a core industrial shareholder. CHICAGO SKYWAY In November 2015, Ferrovial (through Cintra) reached an agreement with Calumet Concession Partners LLC a consortium comprising the Canadian pension funds OMERS, Canada Pension Plan Investment Board and Ontario Teachers Pension Plan for the sale of 100% of the Chicago Skyway toll road (55%-owned by Ferrovial, and 45% by Macquarie Atlas Roads and Macquarie Infrastructure Partners). The deal was closed on 25 February 2016, since when the assets have no longer been classified as Assets Held for Sale. The price agreed was USD2,836mn (approximately EUR2,623mn), or USD269mn pre-tax for Ferrovial and a net capital gain of EUR110mn. 6

7 407ETR PROFIT & LOSS ACCOUNT CAD million Mar-16 Mar-15 Var. Revenues % EBITDA % EBITDA Margin 83.3% 80.6% EBIT % EBIT Margin 71.8% 71.1% Financial results % EBT % Corporate income tax % Net Income % Contribution to Ferrovial equity accounted result (EUR mn) % NB: since the sale of 10% of the asset in 2010, it has been consolidated by the equity method as a reflection of Ferrovial s present stake (43.23%). Revenues increased by +5.2% in local currency terms in 1Q 2016 compared with the same quarter in In more detail: Toll revenues (92% of the total): rose by +10.2% to CAD208mn, principally as a result of the tariff increase applied since February 2016, and the improvement in traffic as a reflection of economic growth and favourable weather conditions. Average revenues per trip increased by +8.9%. Fee revenues (7% of the total): increased by +4.0% to CAD16mn, mainly due to an increase in the number of transponders. Contract revenues (1% of the total) or revenues for works carried out on the East Extension Phase I: these fell from CAD11mn in 1Q 2015 to CAD2mn in 1Q 2016 due to the greater volume of work carried out during The concession also reported EBITDA growth of +8.7% at quarter-end, improving the EBITDA margin from 80.6% to 83.3%. The financial result reached CAD74mn, with an increase in costs of CAD7mn (+10.4%) compared with the 1Q The main components were: Interest expenses: -CAD85mn in 1Q 2016, a rise of CAD4mn vs. 1Q 2015 due to the increased debt burden, mainly the issuance of CAD150mn (in March 2015) and the higher balance on existing credit lines. Non-cash financial revenues linked to inflation: CAD9mn in 1Q This represented a fall of CAD2mn, reflecting the combination of smaller decline in inflation expectations and reduced negative impact of the fair value of the bonds. 407ETR contributed to Ferrovial s equity-accounted result of EUR16mn (in line with 1Q 2015), after the annual amortisation of the goodwill arising on the sale of 10% of the asset in 2010, which is being written down over the life of the asset as a reflection of the expected traffic flows. 407ETR DIVIDENDS In April 2016, a second dividend payment was approved amounting to CAD187.5mn. CAD mn Q Q Q Q Total ETR TRAFFIC Traffic, in terms of total kilometres travelled, increased by +0.8% due to a +0.7% increase in the number of journeys and +0.1% increase in the average distance per journey. Traffic principally benefited from economic growth and favourable weather conditions. 407ETR NET DEBT At 31 March 2016, the 407ETR s net debt stood at CAD6,387mn, with an average cost of 4.67%. The concession issued no debt during the quarter. 34% of the concession s debt has a maturity of more than 20 years. The next maturities fall due this year (CAD297mn) following the refinancing which took place on February ETR CREDIT RATINGS S&P: On 17 March 2016, the agency affirmed its ratings on 407ETR s debt, as follows: A (Senior Debt), A- (Junior Debt) and BBB (Subordinated Debt), all with Stable Outlook. DBRS: On 31 December 2015, the agency affirmed its ratings at A (Senior Debt), A low (Junior Debt) and BBB (Subordinated Debt). 407ETR TARIFFS The table below compares the 2015 and 2016 tariffs (the latter came into effect on 1 February 2016) for light vehicles: CAD Regular Zone AM Peak Period: Mon-Fri: 6am-7am, 9am-10am AM Peak Hours: Mon-Fri: 7am-9am PM Peak Period: Mon-Fri: 3pm-4pm, 6pm-7pm PM Peak Hours: Mon-Fri: 4pm-6pm Light Zone AM Peak Period: Mon-Fri: 6am-7am, 9am-10am AM Peak Hours: Mon-Fri: 7am-9am PM Peak Period: Mon-Fri: 3pm-4pm, 6pm-7pm PM Peak Hours: Mon-Fri: 4pm-6pm Midday Rate Weekdays 10am-3pm Weekends & holidays 11am-7pm /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km /km Off Peak Rate Weekdays 7pm-6am, Weekends & holidays 7pm-11am /km /km In the first quarter of 2016, 407ETR distributed a dividend of CAD187.5mn, in line with 1Q Of this, EUR58mn was attributable to Ferrovial (vs. EUR56mn in 1Q 2015). 7

8 NTE PROFIT & LOSS ACCOUNT NTE USD million Mar-16 Mar-15 Var. Revenues % EBITDA % EBITDA Margin 75.1% 67.5% EBIT % EBIT Margin 53.3% 52.0% Financial results % EBT % Corporate income tax Net Income % In the first quarter of 2016, revenues were +71.5% higher than in the same period in 2015 at EUR16mn, mainly due to traffic growth (+42%) and higher tolls (+20%). NTE TRAFFIC & TOLLS In terms of traffic: in Q NTE registered 5.7 million transactions, +42% more than in the same period last year. After more than one year of opening, traffic is still showing strong signs of continuous ramp up, increasing market share of traffic along the corridor and maintaining a high proportion of new customers every month. Traffic was benefited by the strong growth along the corridor, increasing familiarity of regional users with the managed lanes concept and a milder than expected winter. Average tolls of 1Q 2016, are shown in the following table: Traffic Q1'16 Transactions (million) 5.7 Average tolls (USD) 2.85 The average toll per transaction was USD2.85, grew by +20% when compared with the first quarter of 2015 (USD2.38) when rates were promotional. Since the dynamic system came into operation, the tolls can be adjusted every five minutes, according to real time traffic conditions. This has allowed the maximum toll to reach the contractual cap during heavily congested periods. LBJ PROFIT & LOSS ACCOUNT LBJ USD million Mar-16 Mar-15 Var. Revenues 15 3 n.s. EBITDA 11 1 n.s. EBITDA Margin 72.3% 20.7% EBIT 7 0 n.s. EBIT Margin 46.7% -19.1% Financial results n.s. EBT n.s. Corporate income tax Net Income n.s. *In September 2015, the LBJ opened to traffic in its full configuration, as until then only two short sections were open (which explains why there are figures for this toll road in March 2015). ** 2015 financial result includes capitalised interest. In the first quarter of 2016, the second quarter in which the full configuration was open to traffic, revenues reached USD15mn. LBJ TRAFFIC & TOLLS: In terms of traffic: in 1Q 2016, traffic reached 8 million transactions. Traffic is showing strong signs of ramp up as drivers get familiar with the project configuration. Traffic between October 2015 and March 2016 has increased on an average week by more than 25%. Average tolls of 1Q 2016, are shown in the following table: Traffic Q1'16 Transactions (million) 8.0 Average tolls (USD) 1.89 The average toll per transaction was USD1.89 compared to the average toll on Q of USD1.64 (+15%). As of March 2016, the dynamic tolling was in operation in LBJ toll road, in its three segments (for two of them, this system had begun in November 2015). Since then, it has been possible to adjust the tolls every five minutes depending on real time traffic conditions. This has allowed the maximum toll to reach the contractual cap during heavily congested periods. NTE EBITDA In 1Q 2016, the NTE reported its highest quarterly EBITDA since the toll road was opened, at USD12mn vs USD6mn in 1Q LBJ NET DEBT The toll road s net debt at 31 March 2016 stood at USD1,426mn (USD1,409mn in December 2015), with an average cost of debt of 5.51%. NTE NET DEBT The NTE s net debt stood at USD1,017mn at 31 March 2016 (USD1,012mn in December 2015), with an average cost of 5.34%. NTE CREDIT RATINGS The agencies have assigned the following credit ratings to NTE s debt: Moody s PAB Baa3 TIFIA FITCH BBB- BBB- LBJ CREDIT RATINGS The agencies have assigned the following credit ratings to LBJ s debt: Moody s PAB Baa3 TIFIA FITCH BBB- BBB- For more information on the concession, please click on the following links: 8

9 SERVICES Revenues 1,157 1, % 3.5% EBITDA % -18.9% EBITDA Margin 5.3% 6.7% EBIT % -36.8% EBIT Margin 2.3% 3.7% EBITDA at Ferrovial % in equity accounted % -31.4% businesses Order book* 19,366 20, % -2.0% JVs order book* 1,925 2, % -1.3% Global order book+jvs* 21,291 22, % -1.9% * Order book compared with December 2015 UK Revenues % 3.4% EBITDA % -49.9% EBITDA Margin 2.3% 4.7% EBIT % -76.6% EBIT Margin 0.7% 3.1% EBITDA at Ferrovial % in equity accounted % -27.8% businesses Order book* 13,058 14, % -4.0% JVs order book* 1,461 1, % -9.8% Global order book+jvs* 14,519 16, % -4.6% * Order book compared with December 2015 In the first quarter of 2016, revenues were -0.4% lower than in 2015, due to slightly weaker exchange rates, mainly GBP vs EUR. Excluding the effect of currency movements, revenues would have risen by +3.5%. By business, in Spain they increased +2.5%; in the UK they fell -2.6% (+3.4% excluding FX movements); and in International, growth reached +15.7% (or +23.3% excluding the FX impact). The EBITDA margin reached 5.3%, below the 6.7% registered in 1Q 2015, mainly as a consequence of the negative performance in the UK. The order book reached EUR21,291mn, -6.6% below the December 2015 level. Excluding the FX impact, the order book would be -1.9% smaller. SPAIN Revenues % 2.5% EBITDA % 1.5% EBITDA Margin 10.3% 10.4% EBIT % 1.9% EBIT Margin 5.0% 5.0% EBITDA at Ferrovial % in equity accounted % 59.4% businesses Order book* 5,713 5, % -1.8% JVs order book* % -2.1% Global order book+jvs* 6,031 6, % -1.8% * Order book compared with December 2015 In Spain, turnover rose +2.5% vs. 1Q 2015, with a notable improvement in the contribution from the waste treatment and maintenance of industrial installations activities. EBITDA margin and EBIT margin remained in line with the same period last year. With regards to the order book, the total at end-march stood at EUR6,031mn (-1.8% vs. December 2015). The highlights of the quarter were the addition of Siemsa (EUR36mn), a company which specialises in industrial maintenance services, and the award of the contract for cleaning and maintenance services at Madrid s Adolfo Suárez Airport (EUR34mn, three years). In the UK, like-for-like revenues (excluding FX impact) in 1Q2016 increased by +3.4% vs. the same period last year. The growth reflected the increased turnover from services to Utilities as a consequence of new contracts won over the course of 2015, which were already in operation. On the other hand, as already anticipated in 2H 2015, there was a significant decline in revenues from local authority contracts as a consequence of budget pressure, especially as regards highway maintenance. Excluding the FX impact, EBITDA was -49.9% lower than in 1Q 2015, or EUR16mn in absolute terms. The main reasons for this were as follows: - The contribution made by local authority contracts (excluding Birmingham) fell by EUR10mn as a consequence of the sharp reduction in volumes in some contracts. These pressures on activity are expected to persist for the rest of the year. This is why initiatives have been put in place to compensate for the negative impact of this drop, adjusting the cost structure to the new revenue volumes. However, the fruits of these initiatives were not yet visible in 1Q Lower revenues on the infrastructure maintenance contract with Birmingham, mainly reflecting costs incurred as a consequence of the litigation with the Council. The contract contributed EUR3mn less EBITDA than in 1Q The rest of the difference vs. last year (EUR3mn) relates to the lower volumes on the highway maintenance contracts with the Highways Agency and the smaller weight of consultancy activities in the railways business (in 2015 margins were higher due to bonuses on achieving KPIs). The order book stood at EUR14,519mn in March 2016 (-4.6% vs. December 2015, excluding the FX effect). The most important contract award during the first quarter 2016 was the highway maintenance contract for Area 7 in the UK, worth EUR77mn and for an initial period of three years. The contract includes the possibility of extensions to a maximum of 15 years, which would imply a total for the order book of EUR370mn, which will be recognised as and when the successive extensions are formalised. 9

10 INTERNATIONAL Revenues % 23.3% EBITDA % 92.5% EBITDA Margin 9.3% 6.4% EBIT 1 0 n.s. n.s. EBIT Margin 2.2% 0.2% EBITDA at Ferrovial % in equity accounted % -58.8% businesses Order book* % 78.4% JVs order book* n.s. n.s. Global order book+jvs* % 118.9% * Order book compared with December 2015 The acquisition supports Ferrovial Services entry into the Australian market by integrating a leading services company with a significant platform across various segments. Broadspectrum operates in Australia and other countries like US, New Zeland, Canada and Chile, and in the energy, mining, telecommunications, social, property, defence and infrastructure maintenance markets. In relation to the provision of services at the regional processing centres in Nauru and Manus province, these services were not a core part of the valuation and the acquisition rationale of the offer, and it is not a strategic activity in Ferrovial s portfolio. Ferrovial s view is that this activity will not form part of its services offering in the future. The International business includes all business of Ferrovial Servicios in countries other than Spain and the UK. In comparison to 1Q 2015, and excluding the FX impact, revenues increased by +23.3%, and EBITDA by +92.5%, with all countries reporting positive growth. The revenue growth by geography in the International division was as follows: Chile: +EUR14.4mn (+9.1% vs. 1Q 2015); Poland: +EUR7.5mn (+104%), and Portugal +EUR6.9mn (+12.3% vs. 1Q 2015). As regards the order book, at end-march it stood at EUR741mn vs. EUR336mn in December Three installations maintenance contracts at Doha Airport were renewed in 1Q 2016 for a total of EUR327mn and a period of three years. The profit on these contracts is consolidated by the equity method. ORDER BOOK The order book remained close to record levels, standing at EUR21,291mn at end-march 2016, a slight (-1.9%) decline in pro-forma terms (excluding the FX impact) vs. December By business areas, in Spain the order book reached EUR6,031mn (-1.8%), affected by the slowdown in public-sector tenders in a year featuring various election processes. In the UK, the order book stood at EUR14,519mn (-4.6% vs. December, excluding FX). At International, the order book as of March 2016 showed a very significant increase (+118.9% in like-for-like terms) and stood at EUR741mn. This reflected the impact of the above-mentioned renewal of three installations maintenance contracts at Doha Airport, for a total volume of EUR327mn. M&A On 6 December 2015, Ferrovial Servicios launched a public offering for the acquisition of 100% of the Australian Broadspectrum (previously called Transfield Services), at a cash price of AUD1.35/share. Subsequently, on 6 April 2016, Ferrovial improved its offer to an all-cash AUD1.50/share. This offer was final, conditioned only to a mínimum acceptance rate of 50.01%, and would remain in place until 2 May On 28 April, Broadspectrum s Board recommended unanimously to the shareholders, the acceptance of the Ferrovial s offer. The offer period has been automatically extended until 7.00pm (Sydney time) on Friday, 13 May 2016 (unless further extended in accordance with the Corporations Act). Ferrovial must obtain at least 90% of acceptances during the offer period to compulsorily acquire all shares in Broadspectrum and de-list the company. 10

11 CONSTRUCTION Revenues % -7.1% EBITDA % -10.0% EBITDA Margin 7.3% 7.4% EBIT % -11.0% EBIT Margin 6.5% 6.6% Order book* 8,875 8, % 3.6% * Order book compared to December 2015 Revenues declined in like-for-like terms (-7.1%), principally due to the finalisation of the managed lanes projects, as well as the slowdown in the domestic market, not fully offset by the growth at Budimex (+12.1% in likefor-like terms) nor in the rest of the international market (the highlights of which were Australia and Chile). International turnover represented 79% of the division s revenues, with the distribution very focused on the Group s traditional strategic markets: Poland, North America, the UK, Chile and Australia. Meanwhile, profitability remained at positive levels and similar to the previous year in all business areas, with the EBITDA margin reaching 7.3%. BUDIMEX Revenues % 12.1% EBITDA % 10.4% EBITDA Margin 5.8% 5.9% EBIT % 10.6% EBIT Margin 5.1% 5.3% Order book* 2,143 1, % 8.0% * Order book compared to December 2015 Activity at Budimex continued the positive trend of the past two years. In like-for-like terms, note the revenue growth (+12.1%) derived from improved execution of Civil Works projects and Residential Construction, as well as an increase in the profitability of the business (+11%), principally as a reflection of the continued management of costs of materials and subcontractors. The order book reached a record high at Budimex at EUR2,143mn, or an increase of +8.0% in like-for-like terms vs. December Order intake at Budimex to March 2016 exceeded EUR375mn, of which approximately 70% represented Civil Works contracts, signed under the auspices of the New Highway Plan WEBBER Revenues % -8.3% EBITDA % 5.7% EBITDA Margin 6.1% 5.3% EBIT % 3.4% EBIT Margin 4.6% 4.1% Order book* % 8.5% * Order book compared to December 2015 Profitability improved slightly, with the EBITDA margin expanding from 5.3% to 6.1%, thanks to good management of the big concession projects now in the final stages, with the majority of their risks satisfactorily mitigated. The order book increased notably in like-for-like terms vs. December 2015, due to the strong organic order intake in the first quarter of 2016 (of more than EUR180mn), continuing the robust pace of the final quarter of FERROVIAL AGROMAN Revenues % -14.2% EBITDA % -17.9% EBITDA Margin 8.5% 8.5% EBIT % -18.5% EBIT Margin 7.7% 7.8% Order book* 5,748 5, % 1.3% * Order book compared to December 2015 Ferrovial Agroman s revenues decreased by -14.2% in like-for-like terms, mainly given the slowdown in the domestic market, which is not offset by the growth in the international market (the highlights of which were Australia and Chile). Profitability remained at high levels (EBITDA margin stood at 8.5%, in line with 1Q 2015), given a combination of the margins generated on the American projects close to completion and the release of provisions on completion of projects in Spain. ORDER BOOK Mar-16 Dec-15 Var. Civil work 7,246 7, % Residential work % Non-residential work % Industrial % Total 8,875 8, % The order book expanded by +1.6% vs. December 2015 (+3.6% in like-forlike terms). The Civil Works segment continued to dominate (at around 82%), and the Group maintains its very selective criteria when considering bidding for contracts. The international order book amounted to EUR7,214mn, substantially larger than the domestic order book (EUR1,661mn), and represented 81% of the total. In 2016 the group has won important contracts in its traditional markets, such as High Speed Rail California (EUR296mn), Olsztyn S51 beltway in Poland (EUR175mn) and a section of the US-175 highway in Dallas (EUR91mn). Revenues declined in like-for-like terms (-8.3%), reflecting the finalisation of the LBJ projects. 11

12 AIRPORTS The Airports division made a -EUR5mn contribution to Ferrovial s equity accounted results (vs. -EUR1mn in 1Q 2015). HAH: -EUR1mn contribution in 1Q 2016, vs EUR7mn in 1Q In likefor-like terms, eliminating the negative impact from the mark-tomarket of hedges, HAH s contribution in 1Q 2016 would be of EUR2mn, vs a negative contribution of less than EUR1mn in 1Q2015. AGS: -EUR5mn contribution in 1Q 2016 vs. -EUR8mn contribution in 1Q HEATHROW HEATHROW SP TRAFFIC In the first quarter of 2016, the number of passengers travelling through Heathrow reached 17 million, +2.6% higher than in March 2015, and beating the previous monthly records in both February and March. Traffic was favourably impacted by the additional day in February (leap year) and by the fact that the Easter holidays fell entirely in March, rather than straddling March/April last year. As well as these impacts, there was an increase in the number of seats thanks to the increased size of the aircraft (with the average number of seats per aircraft rising to vs in 1Q 2015). Load-factors reached 71.5% vs. 71.2% in 1Q TRAFFIC PERFORMANCE BY DESTINATION Million passengers Mar-16 Mar-15 Var. UK % Europe % Long Haul % Total % The trend observed in 2015 continued into 2016, with European traffic posting the strongest growth by geography (+4.2%), with an increase in the number of seats. Intercontinental traffic rose 3.4%, principally thanks to North American routes (+3.3%), with an increase in the number of flights, the Middle East (+6.7%) with larger aircraft, and Asia Pacific (+4.5%), given the new airlines, including the new Vietnam Airways routes to Ho Chi Minh City and Hanoi. At the end of March, Garuda Airlines became the latest airline to move its services from Gatwick to Heathrow, following in the footsteps of other airlines such as Vietnam Airlines and Air China. Traffic to Africa declined, fruit of Virgin Atlantic s schedule changes in 2015, which reduced frequency to Africa and Asia, and increased the number of flights to North America. The strong international performance compensated for the fall in domestic traffic (-12%) due to Virgin Little Red ceasing operations in March HEATHROW SP REVENUES Revenue growth (+3.2%) supported both the growth in retail earnings (+10.6%) and the increase in aeronautical earnings (+1.8%), driven by traffic growth. GBP million Aeronautic % 1.8% Retail % 10.6% Others TOTAL % 3.1% The average aeronautical earnings per passenger fell (-0.8%) to GBP23.17 from GBP23.35 in Retail earnings increased by +10.6%, principally due to the important remodelling of the shops in Terminal 5, with new brands, strengthening Heathrow s product offering. The World Duty Free (WDF) shops have continued to expand (+7.4%) since the end of the refurbishment of Terminal 5. The specialised shops also performed well (+13.6%), as did the car parks (+12.0%). Net retail earnings per passenger increased +7.7% to GBP8.10. The Other revenues element remained in line, with a positive rentals oneoff, which made up for the decline in other regulated revenues. HEATHROW SP EBITDA Heathrow SP s adjusted EBITDA rose +7.3% in 1Q 2016 vs. revenue growth of +3.2% in the same period. The EBITDA margin reached 57.2% vs. 55.0% in 1Q The cost controls introduced in at the beginning of the regulatory period remained in place (operating costs fell by -1.8% vs. 1Q 2015), including the reduction in energy consumption. Personnel cost savings on the back of the adoption of a voluntary severance programme, automation and other efficiency measures are lowering labour costs significantly (-5.4%). The changes made to the pension system in 2015 are generating even more savings. Operating and maintenance cost efficiencies were partly eroded by the additional costs to guarantee the high service levels. Depreciation rose by +11.5% as a reflection of the new integrated baggage facility and other assets in T3. GBP million Traffic (million passengers) Revenues EBITDA EBITDA Margin Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. (pbs) Heathrow SP % % % 57.2% 55.0% 220 Exceptionals & adjs 0 1 n.s. 1 0 n.s. n.a. n.a. n.a. Total HAH % % % 57.3% 54.9%

13 USER SATISFACTION In the first three months of 2016, Heathrow was nominated Best Airport in Western Europe for the second time running by Skytrax World Airport Awards. The award, voted by passengers froim all around the world, also recognised Terminal 5 as the Best Airport Terminal for the fifth year running and for the sixth time, Heathrow won the Best Shopping Airport award. For the first time, Heathrow won the prestigious Best European Airport Award, in the category of more than 40 million passengers, in the 2016 ASQ awards by Airports Council International. User satisfaction remains at record levels, with 81% of passengers describing their experience as excellent or very good (vs. 82% in the same period in 2015). REGULATORY ASPECTS Regulatory period: The regulatory period (Q6) began on 1 April 2014 and runs until 31 December The CAA has approved a maximum annual tariff increase per passenger of RPI -1.5%. Regulatory Asset Base (RAB): At end-march 2016, the RAB stood at GBP14,911mn (vs. GBP14.921mn in December 2015). Airports Commission: On 1 July 2015, the Airports Commission clearly and unanimously recommended a new plan for the north-west runway at Heathrow, as a means of solving the capacity problems in the UK. It recognised the role that Heathrow plays as the only hub airport and the only solution that can help the global growth of British companies. With the expansion, Heathrow would be able to offer up to 40 new longhaul trading links enabling more high value British goods to reach fastgrowing global markets more quickly and at a lower cost. HAH FINANCIAL RESULT This reached GBP173mn, a GBP41mn deterioration vs. 1Q 2015, explained by: the mark-to-market of hedging instruments (-GBP43mn), slightly offset by the financing result (+GBP2mn), mainly due to the reduced costs of the subordinated debt. HAH DIVIDENDS In the first quarter of 2016, HAH distributed an ordinary dividend amounting to GBP75mn (of which EUR26mn attributable to Ferrovial), in line with the dividends distributed in the same period last year (GBP75mn). HAH NET DEBT At 31 March 2016, the average cost of Heathrow s external debt was 4.72% including all the interest-rate, exchange-rate and inflation hedges (vs. 4.97% in December 2015). GBP million Mar-16 Dec-15 Var. Loan Facility (ADI Finance 2) % Subordinated % Securitized Group 12,192 12, % Other & adjustments n.s. Total 13,735 13, % The figure for net debt refers to FGP Topco, parent company of HAH. HAH The table below sets out HAH s Profit & Loss Account. GBP million Revenues % 3.0% EBITDA % 7.6% EBITDA margin % 57.3% 54.9% Depreciation % 10.6% EBIT % 4.5% EBIT margin % 27.3% 26.9% Impairments & disposals % n.s. Financial results % 0.9% EBT % n.s. Corporate income tax % -56.8% Result from discontinued operations n.s. Net income % n.s. Contribution to Ferrovial equity accounted result (EUR mn) % n.s. 13

14 UK REGIONAL AIRPORTS (AGS) AGS TRAFFIC Million Passengers Traffic Mar-16 Mar-15 Var. Glasgow % Aberdeen % Southampton % Total AGS % In the first quarter of 2016, the number of passengers at the regional airports reached 2.8 million, an increase of +2.4%, thanks to the growth at Glasgow (+12%) as a reflection of higher load-factors on London routes and the positive performance of the European routes. Traffic at Glasgow reached 1.8 million passengers (+12.0%). Domestic traffic improved by +10.5%, largely due to the good performance of routes to London driven by higher load-factors at Ryanair and increased frequencies at EasyJet. In the rest of the domestic market, the highlight was the significant increase in capacity at EasyJet (Bristol and Belfast), and a good performance at Flybe, with its new routes to Cardiff and Exeter. International traffic increased (+13.7%) due to the growth in European traffic thanks to the performance of Ryanair s routes to Dublin (high loadfactors) and Stobart Air, the robust performance of Wizz Air on its routes to Bucharest, Budapest, Lublin and Vilna, and to the use of larger aircraft by KLM. Long-haul traffic fell, principally due to lower load-factors at Emirates. Traffic at Aberdeen reached 0.7 million passengers (-14.7%). Traffic at this airport is closely linked to the North Sea Oil&Gas industry. Helicopter traffic decreased (-19.1%) due the fall in demand from the oil industry. Domestic traffic fell by -18.5%, mainly due to the disappointing performance of the London routes as a reflection of the negative impact of the loss of Virgin Little Red, the drop in charter passengers on oil industryrelated routes, and the cancellation of the Flybe Shuttle (which was still in operation in March 2015). International traffic declined by -2.4%, mainly due to the loss of passengers on the Scandinavian routes (to oil industry destinations), reducing frequencies and load-factors at BMI, SAS and Wideroe, although this was partially offset by the new Wizz Air route to Gdansk and the new Icelandair route to Reykjavik. Traffic at Southampton reached 0.4 million passengers (-2.4%). International traffic declined (-3.4%) as a reflection of lower passenger numbers on routes to Geneva, Paris Orly, Limoges, Malaga, Rennes, Lerida and Dublin, offset by the good performance on routes to Dusseldorf, Amsterdam and Chambery. Domestic traffic deteriorated by -2.0%, principally due to the cancellation of the route to Aberdeen/Leeds, offset by growth on routes to Newcastle, Glasgow and Guernsey. AGS REVENUES & EBITDA In the first three months of 2016, the UK regional airports reported EBITDA growth of +4.0%, vs. a -2.0% decline in revenues, thanks to lower costs (-4.1%) driven by cost controls. AGS NET BANK DEBT At 31 March 2016, the regional airports net bank debt stood at GBP509mn. AGS DIVIDENDS In 1Q 2016, AGS distributed dividends of GBP9mn for 100% of shareholders. Ferrovial received the dividends corresponding to its share (50%) after the end of the quarter, in the first few days of April AGS RESULTS GBP million Revenues EBITDA EBITDA Margin Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. Mar-16 Mar-15 Var. (pbs) Glasgow % % 29.0% 23.3% Aberdeen % % 30.0% 30.7% Southampton % % 13.0% 19.8% Total AGS % % 27.1% 25.5%

15 BALANCE SHEET Mar-16 Dec-15 Mar-16 Dec-15 FIXED AND OTHER NON-CURRENT ASSETS 16,032 16,821 EQUITY 6,723 6,541 Consolidation goodwill 1,814 1,885 Capital & reserves attrib to the Company s equity holders 6,070 6,058 Intangible assets Minority interest Investments in infrastructure projects 8,330 8,544 DEFERRED INCOME 1,044 1,088 Property Plant and Equipment NON-CURRENT LIABILITIES 9,341 9,314 Equity-consolidated companies 3,114 3,237 Pension provisions Non-current financial assets Other non current provisions Long term investments with associated companies Financial borrowings 6,881 6,697 Restricted Cash and other non-current assets Financial borrowings on infrastructure projects 5,300 5,320 Other receivables Financial borrowings other companies 1,581 1,376 Deferred taxes 886 1,254 Other borrowings Derivative financial instruments at fair value Deferred taxes 932 1,124 Derivative financial instruments at fair value CURRENT ASSETS 6,631 8,563 Assets classified as held for sale 0 2,418 CURRENT LIABILITIES 5,555 8,442 Inventories Liabilities classified as held for sale 0 2,690 Trade & other receivables 2,526 2,320 Financial borrowings 1,532 1,385 Trade receivable for sales and services 1,970 1,821 Financial borrowings on infrastructure projects 1,449 1,297 Other receivables Financial borrowings other companies Taxes assets on current profits Derivative financial instruments at fair value Cash and other temporary financial investments 3,529 3,279 Trade and other payables 3,224 3,346 Infrastructure project companies Trades and payables 1,908 1,996 Restricted Cash Other non comercial liabilities 1,316 1,350 Other cash and equivalents Liabilities from corporate tax Other companies 3,178 2,973 Trade provisions Derivative financial instruments at fair value TOTAL ASSETS 22,663 25,384 TOTAL LIABILITIES & EQUITY 22,663 25,384 CONSOLIDADATED PROFIT & LOSS ACCOUNT Before Fair value Adjustments Fair value Adjustments Mar-16 Before Fair value Adjustments Fair value Adjustments Revenues 2,083 2,083 2,147 2,147 Other income Total income 2,084 2,084 2,149 2,149 COGS 1,890 1,890 1,939 1,939 EBITDA EBITDA margin 9.3% 9.3% 9.8% 9.8% Period depreciation EBIT (ex disposals & impairments) EBIT (ex disposals & impairments) margin 6.5% 6.5% 6.8% 6.8% Disposals & impairments EBIT EBIT margin 19.3% 19.6% 7.3% 7.3% FINANCIAL RESULTS Financial result from financings of infrastructures projects Derivatives, other fair value adjustments & other financial result from infrastructure projects Financial result from ex infra projects Derivatives, other fair value adjustments & other ex infra projects Equity-accounted affiliates EBT Corporate income tax Net Income from continued operations Net income from discontinued operations Consolidated Net Income Minorities NET INCOME ATTRIBUTED Mar-15 15