Infrastructure in Mexico Alonso Quintana Chief Financial Officer Empresas ICA, S.A.B. de C.V. Mexico City February 16, 2010
National Infrastructure Plan 2007-2012: Requirements and Goals by Sector Sector Investment US$ billion % of Total Highways 26.5 11.3 Featured Goals for 2012 Build and modernize 17,600 kms Railroads 4.5 1.9 Build 1,418 kms Ports 6.6 2.8 Airports 5.5 2.3 Telecommunications 26.1 11.2 Water and Sewerage 18.6 8.0 Electricity 35.1 15.0 Hydrocarbons 110.9 47.4 Build five new ports and modernize 22 Build three new airports and increase capacity in 31 Fixed and mobile line coverage. Increase internet usage. Coverage: potable water 92% and sewerage 88%. Increase generation capacity to 6.8 gigawatts. Oil production 2.5 mbpd, Increase natural gas production. Increase refinery capacity. Total 233.7 100% Source: Ministry of Finance, Nov. 2009 2
National Infrastructure Plan as % of GDP Based on government estimates, total infrastructure spending will increase approximately 8% in peso terms, an equivalent to 5% of Mexico s 2010 GDP. 5% 4.8% 5.0% 5.0% 4% 3.2% 3.2% 3.1% 3.5% 3.6% 3.9% 4.0% 4.1% 3% 2% 1% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009e 2010e Source: Ministry of Finance, Nov. 2009 3
National Infrastructure Plan 2007-2012: Progress Sector US$ billion NIP 2007-2012 Progress as of Nov. 2009 To be invested US$ billion (2010 2012) Highways 26.5 40.7% 15.7 Railroads 4.5 45.4% 2.5 Ports 6.6 28.9% 4.7 Airports 5.5 15.0% 4.6 Telecommunications 26.1 29.7% 18.4 Water and Sewerage 18.6 41.3% 10.9 Electricity 35.1 34.2% 23.1 Hydrocarbons 110.9 46.2% 59.7 Total 233.7 40.3% 139.5 Source: Ministry of Finance, Nov. 2009 4
ICA Overview Construction Infrastructure Civil Industrial Airports Concessions Housing Mexico s Largest Construction and Infrastructure Company Highest construction backlog in history Revenues LTM (as of 3Q09) Ps. 34.6 billion Ps. 46.6 billion > 2.8x historical average 2009 performance strong +41% Revenue growth 14.1% EBITDA Margin 5
Dynamic Growth 50,000 40,000 30,000 12,000 Quarterly revenue (Ps. mm) Backlog Quarterly revenue 10,000 8,000 6,000 4,000 2,000 - (Ps. mm) 20,000 10,000-6 I-92 I-93 I-94 I-95 Backlog I-96 I-97 I-98 I-99 I-00 I-01 I-02 I-03 I-04 I-05 I-06 I-07 I-08 I-09
Formula for success Execution + New backlog + Strategic positioning = An exceptional 2009 and a strong outlook for Empresas ICA 7
Strategic Transactions Raised US$221mm in new equity Resources to continue to invest in new infrastructure, civil construction, and housing Keeps solid capital structure 8
Strategic Transactions Acquired Cotrisa Adds expertise in water, tunneling projects Strengthens competitive bidding position 9
Strategic Transactions Acquired control of Viabilis (Rio de los Remedios tollroad) Control of board and management Ability to continue to support this high profile project 10
Strategic Transactions RCO (Farac 1) recapitalized Taps pension funds LT capital Lower leverage aligns with market conditions 11
Strategic Transactions Investment in Casaflex ICA s home factory is one of a kind in Latam. 12
Financial Summary Revenues (Ps. billion) Adjusted EBITDA Margin 17.2 22.6 22.5 27.2 41% 18.1 25.6 11.3% 10.7% 10.9% 10.0% 9.5% 14.7% 13.7% 12.8 2004 2005 2006 2007 2008 9M08 9M09 2004 2005 2006 2007 2008 9M08 9M09 Adjusted EBITDA includes interest expense in cost of sales 13
Income Statement (Ps. million) 9M08 9M09 % Revenues 18,109 25,567 41 Operating Income 1,263 2,079 65 Operating Margin % 7.0 8.1 Adj. EBITDA 2,178 3,606 66 Adj. EBITDA Margin 12.0 14.1 Integral Financing Cost 427 588 38 Taxes 82 433 431 Net Income 612 811 33 4tr 2008 Minority Interest 292 287 (5) Majority Interest 320 533 67 Revenues Adj. EBITDA Concessions 6% Airports 5% Housing 6% Airportss 26% Civil 34% Rodio 5% Concessions 20% Civil Industrial 53% 25% Housing 4% 9M09 Rodio 3% 9M09 Industrial 13% 14
Construction (Ps. million) Revenues % EBIT % EBITDA % EBITDA Margin Construction 21,277 48% 1,058 169% 1,495 135% 7.0% Civil Construction Industrial Construction 13,598 82% 691 117% 1,024 125% 7.5% 6,383 11% 328 430% 379 230% 5.9% Rodio 1,296 10% 39 187% 92 40% 7.1% Main projects under construction: Civil Construction La Yesca hydroelectric project RCO Modernization Rio de los Remedios Ecatepec Toll Road Rio Verde- Cd. Valles Highway Industrial Construction Chicontepec II Minatitlan II oil field services Dos Bocas terminal refinery reconfiguration 18
Backlog 3Q09 Current Backlog Termination Date Total Contract Amount (mdp) Project Progress (%) Clients Civil Construction 69% 32,309 Line 12 Mexico City Subway 6,556 4Q11 7,923 17 La Yesca Hydroelectric Project 5,037 2Q12 9,990 50 Eastern Outlet Tunnel 4,570 2Q12 4,901 7 Rio de los Remedios Ecatepec Highway 3,271 1Q11 5,345 39 Nuevo Necaxa - Tihuatlán Highway 2,193 2Q11 2,741 20 Rio Verde - Ciudad Valles Highway 1,709 2Q10 2,617 35 Agua Prieta Water treatment plant 1,329 4Q12 1,329 - La Piedad Bypass 1,312 1Q11 1,312 - El Realito Aqueduct 1,106 1Q12 1,106 - México - Pachuca Highway 646 4Q11 1,197 46 Zacatecas General Hospital 623 2Q10 707 12 Other Civil Projects 3,956 Industrial Construction 30% 13,777 Madero Clean Gazoline Plant 4,977 3Q12 4,977 - Cadereyta Clean Gazoline Plant 3,607 3Q12 3,607 - Poza Rica Criogenic Plant 3,425 3Q11 3,520 3 Chicontepec II Oil Field, Veracruz 919 4Q11 1,494 39 Dos Bocas - Crude oil dehydration plant 146 4Q09 715 80 Other Industrial Projects 704 Rodio 1% 466 Projects in Spain, Moroco and Central America 466 Private Concessions Abroad 4% 12% 9M-09 84% Location 1% 9M-09 Public Total 46,552 New awards during 4Q09: Atotonilco* and PAC 4 (Panama) * Project awarded to ICA consortium, but contract not yet signed. Mexico 99% 16
Civil Construction Pipeline Water Arcediano Dam Valley of Mexico Sanitation Highways Maintenance and Conservation Hospitals State, IMSS and ISSSTE Rail Cd. Juarez, Chiapas-Mayab, Córdoba Other Prisons Buildings Bicentenary Park in Azcapotzalco 17
Industrial Construction Pipeline Pemex Platforms Clean fuels and diesel gasoline packages Ethylene plant, cogeneration. New refinery Pipelines CFE Power Generation Plants 18
Infrastructure Concessions Revenues % EBIT % Adj EBITDA % EBITDA Margin Concessions 1,668 87 417 56 880 103 36.9% 14 Concessions: Project Term Period Operating Highways Tollroads Highways Tollroads Under construction Water Projects Acapulco Tunnel 2034 Corredor Sur 2029 Farac 1 2037 Del Mayab 2020 Irapuato La Piedad 2025 Queretaro Irapuato 2026 Rio Verde Cd. Valles 2027 La Piedad bypass 2039 Rio de los Remedios 2056 N. Necaxa Tihuatlan 2037 Cd. Acuña 2020 Aqueduct 2 2027 El Realito 2034 Agua Prieta 2030 19
Concessions Pipeline PPPs Mitla- Tehuantepec Toll Roads FARAC 2 (South Pacific), FARAC 3 North SLP bypass Century XXI highway FARAC IV Cd. Valles-Tamuin Rail Suburban Light Rail Systems 2 & 3 Water Falcón Matamoros Aqueduct El Zapotillo Ports Tuxpan II Lázaro Cárdenas Punta Colonet 20
Airports Revenues % EBIT % EBITDA % EBITDA Margin Airports 1,414 (6) 490 (16) 792 (9) 56.1% Business Strategy: Protect aeronautical revenue 13 airports: 11.9mm passengers Develop new sources of non-aeronautical revenues T2 hotel and commercial areas (Mexico City International Airport) Monterrey Airport Improve commercial offering in terminals Control costs Investment for long-term growth Increase connectivity 21
Housing Revenues % EBIT % Adj EBITDA % EBITDA Margin Housing 1,493 8 117 14 161 (35) 7.5% Business Strategy: Adjust mix to market conditions Entry level and affordable 22 projects in 10 states Improve efficiency Inventory reduction Shorten business cycle Improve profitability SG&A expenses reduction Maintain long term growth Units sold 8,096 7,786 5,909 5,337 4,933 4,408 2,997 2004 2005 2006 2007 2008 9M08 9M09 Financing: - Infonavit 74% - Fovissste 10% - Other 16% 22
ICA s Strategy Major growth opportunities still ahead Excellence in execution Diversification profitability and stability Prudent financial position No company is better positioned than ICA to take advantage of the opportunities in Mexican infrastructure. 23
IR Contacts Luciana García luciana.garcia@ica.com.mx +52 55 5272 99 91 José Eduardo Ontiveros jose.ontiveros@ica.com.mx +52 55 5272 99 91 ext. 3678 Ricardo Jimenez ricardo.jimenezu@ica.com.mx +52 55 5272 99 91 ext. 3672