Ferrovial - Annual Report 2010

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Company profile

A new environment

Ferrovial strengthened its financial solvency, realized value from its assets, generated cash flow and grew organically, while extending its internationalization. Ferrovial has confirmed its position as global leader in infrastructures and services, with its commitment to innovation, the environment and society as key elements.

A new international macroeconomic reality took shape in 2010 characterized by factors such as a credit squeeze, restricted public spending and reduced consumption. Companies have had to adapt to this new reality. Ferrovial has done so successfully. It has returned to profitability and posted historical results by putting into practice a demanding fiscal discipline, realizing value from its assets and generating cash flow, combined with organic growth. This has improved its balance sheet and allowed it to face the future with the conviction of having fulfilled its strategic plan.

Throughout the year Ferrovial has satisfactory completed a strategy of asset value realization and asset rotation. The most notable disinvestments were the sale of 10% of the 407 ETR toll road, 60% of Cintra Chile and all of Tube Lines, the London Subway concessionaire. Swissport was sold at the end of the year, while BAA closed the sale of Airport Property Partnership (APP) and the 65% stake in Naples Airport.

The company has strengthened its international profile as a result of the process started some years ago. Currently 69% of sales and 85% of EBITDA is from international markets. This is also the case with some of the major contracts and deals concluded, such as the highway maintenance in the city of Birmingham, the Donarbon portfolio, the financing of the LBJ toll road in Texas, the construction of the new terminal at Heathrow, and various contracts in Poland.

The order backlog is at an all-time high, at 22.190 billion euro. The backlog in the Services division has increased by 20% to its highest level at 12 billion euro. In Construction, growth was 16% to 10.186 billion. The international proportion in both cases is 60%. This backlog guarantees activity in the medium and long term.

Cash flow maintains its positive trend, at above 800 million euro, which together with disinvestments, gives a net cash flow position of 31 million euro. Ferrovial has improved its main financial figures and reduced corporate debt by more than 1.2 billion euro. Net consolidated debt, including infrastructure projects, stood at 19.789 billion.

The profitability of Ferrovial Servicios improved in 2010 as a result of new contracts in the United Kingdom and cost control and client selection in Spain.

For Cintra, traffic reflected the situation of the local economies. Traffic on the 407 ETR grew by 5.5%. On the financial side, Cintra closed the finance for the LBJ toll road, the 407 ETR issued bonds, and Ausol and R4 concluded the extension of the maturity of the syndicated loan.

The strong growth of international activity in Construction offsets reduced activity in the domestic market. The year’s new international contract awards included the LBJ toll road in Texas and the construction of the new terminal in Heathrow. Budimex in Poland and Webber in the United States both posted notable results for the year, thus confirming the success of both acquisitions.

BAA results were affected by the cloud of volcanic ash from Iceland, the British Airways cabin crew strike and the snowstorm in December. Without these factors, traffic in Heathrow would have grown by 3.4%. BAA traffic amounted to 109 million passengers, while the figure for Heathrow was 66 million. Between July and November 2010 this trend was reversed, with Heathrow posting five consecutive months of all-time highs in passenger numbers.

As a leader in infrastructures and services, Ferrovial is at the cutting edge of new solutions to improve the quality of life of users and ensure economic, social and environmental sustainability. An example of this commitment to continuous improvement and transfer of the best infrastructure and service options to society is the ambitious agreement concluded with the Massachusetts Institute of Technology (MIT). The results of this agreement will be seen in the future, as is the case with the Center for Intelligent Infrastructure Innovation (Ci3), which was set up last year.

For the ninth year in a row Ferrovial was selected by the DJSI as one of the elite global companies in the sector in terms of its sustainability practices. It also received the backing of FTSE4Good, another index that lists committed companies.

© Copyright 2010. Ferrovial

In agreement with:
  • Dow Jones Sustainabiliy Indexes
  • LBG Spain
  • Ethibel
  • FTSE4Good
  • The Global Compact
  • Distinction of Equality
  • Triodos Bank
  • Carbon disclosure project

This is an electronic version of the 2010 Annual Report prepared by Ferrovial S.A. for its stakeholders, which aims to be complete and accurate. The contents of this version can be checked by referring to the print version. A copy of the print version in PDF format is available to download on this web page