abertis: infrastructure management leader 26th june 2007
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abertis: infrastructure management leader
26th June 2007
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The information and forward-looking statements contained in this presentation have not been verified by an independent entity and the accuracy, completeness or correctness thereof should not be relied on. In this regard, the persons to whom this presentation is delivered are invited to refer to the documentation published or registered with the Spanish stocks markets regulator (Comisión Nacional del Mercado de Valores). All forecasts and other statements included in this presentation that are not statements of historical fact, including, without limitation, those regarding the financial position, business strategy, management plans and objectives for future operations of abertis (which term includes its subsidiaries and investees), are forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause actual results, performance or achievements of abertis, or industry results, to be materially different from those expressed or implied by these forward-looking statements. These forward-looking statements are based on numerous assumptions regarding abertis’ present and future business strategies and the environment in which abertis expects to operate in the future which may not be fulfilled. All forward looking statements and other statements herein speak only as of the date of this presentation and abertis does not undertake to update any such statements. None of abertis or any of its affiliates, advisors or representatives, nor any of their respective directors, officers, employees or agents, shall bear any liability (in negligence or otherwise) for any loss arising from any use of this presentation or its contents, or otherwise in connection herewith.
The information contained in this presentation shall neither be published nor distributed without the previous express consent of Abertis Infraestructuras, S.A.
The distribution of this presentation in certain other jurisdictions may be restricted by law. Consequently, persons to which this presentation or a copy of it is distributed must inform themselves about and observe such restrictions. By receiving this presentation you agree to observe those restrictions.
Nothing herein constitutes an offer to purchase and nothing herein may be used as the basis to enter into any contract or agreement.
Disclaimer
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1. abertis overview
2. Business units
3. Summary of 2006. Key indicators
4. Strategic challenges: abertis in an attractive market
a. An attractive market
b. abertis competitive advantages
c. abertis strategy
d. Financial objectives
e. Economic objectives
Table of Contents
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1. abertis overview
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abertis is an international group, leader in managing infrastructures for mobility and telecommunications through five business areas:
abertis overview
2006A Rev: €3,335m+75% YoY+ 11% like for like
2006A EBITDA: €2,099m+74% YoY+ 12% like for like
Highways06 Rev.:
€2,537m06 EBITDA:
€1,827m
Telecom.
06 Rev.:
€369m06 EBITDA: €154m
Airports
06 Rev.: €282m06 EBITDA: €92m
Car Parks06 Rev.:
€118m06 EBITDA:
€47m
Logistics
06 Rev.: €19m06 EBITDA: €6m
Geographical diversification focused on infrastructures with high Ebitda generation capacity
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abertis overview
Sustainable and selective growth strategy with a business model focused on long term investments
Solid Shareholder structure committed to the company strategy
Market capitalisation over €13,000m and presence in the major stock market indexes (Ibex 35, S&P Europe 350, FTSE Eurofirst 300)
Low risk profile and solid financial structure (Rating A/A , S&P/Fitch) with limited sensitivity to interest rates changes
High cash flow generation capacity
Focused in infrastructures and diversified by geographies
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abertis overview
Toll roads Telecom Airports Car parks Logistics
5 sectors
16 countries
11,000 employees
€3,335m in revenues
€2,099m EBITDA
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2. Business units
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Business units
By Business Line
Revenues
EBITDA
By Geography
Revenues
EBITDA
Motorways account for more than 76% of revenues and 87% of 2006 EBITDA
37%
6%
52%
5% Others
3%
57%
3%
37%
Others
4% 1%
8%
11%
76%
4% 2%
7%
87%
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Toll Roads - Spain
Leader in the sector in Spain
59% of all toll roads in Spain
Directly managed > 1.500 km
Indirectly managed > 225 km
Business units
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Toll Roads - France
52,50% of the sanef group
1.743 km directly managed
21% of network in France 53% of total abertis network
Managing 4 of the 7 Paris access roads, and the traffic connecting Germany, Belgium and Luxembourg to Northern France and the United Kingdom
Business units
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Toll Roads – Rest of the World
Business units
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Telecommunications infrastructure
Leader in Spain
More than 3.000 sites
National coverage of radio and TV (coverage: > 99% analogical; > 80% TDT)
Business units
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Telecomunnications infrastructure
Opening to International Markets
Acquisition of 32% of the European satellite operator Eutelsat
3rd world operator of fixed satellites, with a global market share of 13% on revenues (30% in Europe)
Fleet of 23 satellites
Business units
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Airports
5 airports with management contracts in the US, Costa Rica and Colombia
8 airports in property or concession, in Europe (UK and Sweden), the US and Bolivia
Business units
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Car parks
Main operator in Spain and a referent for all the sector in Europe
6 countries, 161 car parks, 87.127 car park units
Business units
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Logistic services
Development and management of logistic parks
Located strategically for freight transportation, near sea, air and land transportation networks (highway and railway).
International strategy: Portugal and Chile
Business units
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2. Summary of 2006. Key indicators
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Revenues (€m) EBITDA (€m)
3,335
1,906
2005 2006
+75%2,099
1,204
2005 2006
+74%
Results (M€)
Summary of 2006. Key indicators
Net Income (€m) Like-for-like Net Income (€m)
511530
2005 2006
+4%572
469
2005 2006
+22%
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Investments: 3.59 B€
Expansion: 3.331 B€
96%
Operative: 259 M€
11%
5%1%
15%
68%
1%
1%
1%
1%
Summary of 2006. Key indicators
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Net generation of funds
Net cash flow + debt application
Operational investment 259 M€
Investments in Expansion 3.331 B€
Dividends 294 M€
2006
822 M€
1.221 B€
2005+48%
Summary of 2006. Key indicators
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Consolidated result
Assets
Tangible assets
Intangible assets
Financial assets
Current assets 9461,856
6,805
9,610
Liabilities
Equity
Financial debt
Other liabilities2,602
12,168
4,447
19.217 B€ + 128%
Summary of 2006. Key indicators
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Debt
Average cost of the debt: 4.8%Average expiry term: 7.3 years
Variable rate16%
Fixed rate84%
With recourse 36%
Without recourse 64%
Summary of 2006. Key indicators
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Net debt / EBITDA
10.3x
5.7x
14.8x
14.5x
7.5x
5.6x
4.5x
4.0xVinci
Autostrade
abertis
Brisa
Eiffage
ASF
Cintra
Ferrovial
Summary of 2006. Key indicators
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Standard & Poor’sFitch Ratings
Summary of 2006. Key indicators
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Profitability indicators
2006
16.1%2005
ROE +10.7%
17.8%
2006
0.77€2005
EPS +21.9%
0.94€
ROE: Net consolidated profit (without non-recurring) / Average net equity
EPS: Net consolidated profit (without non-recurring) / adjusted number of shares
Summary of 2006. Key indicators
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4. Strategic challenges: abertis in an attractive market
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Predictable cash flows
Flexible financing formulas
Strong need for capital
Balance between risk and profitability
Appearance of financial-type players
a. An attractive market
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Attractive market + Complexity
High expectations+ Difficulty
+ Risk
a. An attractive market
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b. abertis competitive advantages
Futures solid and predictable cash
flows
Futures solid and predictable cash
flows
Regulated assets with strong
upfront capex requirements
Regulated assets with strong
upfront capex requirements
Attractive balance
risk/return ratio
Attractive balance
risk/return ratio
Additional leverage capacity
Additional leverage capacity
New players looking for industrial expertise
New players looking for industrial expertise
Attractive to long-term investors
Attractive to long-term investors
Uniquely positioned in an attractive market
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Investment criteria
abertis main shareholder
Single industrial partner
Commitment with local partners
Participation of financial partners
Financial design adapted to the project
IRR around 10%
b. abertis competitive advantages
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c. abertis strategy
A clear strategy focused on growth and profitabilityThe infrastructure group that has invested de most
€8,000m invested (EV) between 2005 and 2007
Total EV: €1,100mCons. Revenues: €257mCons. EBITDA: €73m
Total EV: €8,900mCons. Revenues: €1,241mCons. EBITDA: €779m
Total EV: €5,800mCons. Revenues: €791mCons. EBITDA: €617m
Investment€1.000m
Investment€1.000m
Investment €5.100m
Investment €5.100m
Investment €1.870m
Investment €1.870m
90%57.5%
32%
(% EV)
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Internationalization
European inspiration, world ambition
c. abertis strategy
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c. abertis strategy
Attractive investment opportunities in Europe
Portugal Brisa (10%) (*) Logistics Car parks
Ireland Motorways
U. Kingdom Motorways Telecom Airports
Spain Motorways Airports Logistics Car parks Telecoms
Italy Autostrade (6.7%) (*) Car parks Telecoms Logistics
France Motorways Car Parks Telecom Airports
Central/Eastern Europe Motorways Airports Car Parks
(*) Strategic Stakes
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c. abertis strategy
Attractive investment opportunities in America
EE. UU. Motorways Telecom Airports Mexico
Motorways
Chile Motorways Car parks Logistics
Canada Motorways
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c. abertis strategy
Investment criteria supported by a solid track record
Acquisition Multiple
14.6x EV/04 EBITDA 11.9x EV/05 EBITDA 9.1x EV/06 EBITDA
Implied IRR 12% - 15% 10% - 11% 10% - 12%
abertis makes investments where it estimates yields superior to 300bps to its project WACC,
with implied shareholders' IRR of around double digit
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d. abertis financial targets
Solid expectations of net cash flow generation over the next 5 years
2007-2011 Net Cash flow Generation
Cumulative 2007-2011E net cash flow generated in excess of €7,000bnCumulative 2007-2011E net cash flow generated in excess of €7,000bn
€7,000m
(€2,000m)
(€3,000m)
€14,000m
(€2,000m)
07-11 EBITDA Financial Expenses Taxes Operating Capex 07-11 Net Cash FlowGeneration (* )
(*) Assuming expansion Capex already committed (i.e AP-7: €500m)
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d. abertis financial targets
Significant re-leveraging capacity
07-11 abertis re-leveraging capacity
€3,7500m of additional re-leveraging capacity assuming and re-investment at 9.0 EV / EBITDA
€3,7500m of additional re-leveraging capacity assuming and re-investment at 9.0 EV / EBITDA
Scenario
Current Net Debt/EBITDA 5.6x
Potential Net Debt/EBITDA 7.0x
Additional Debt Capacity (1) €3,750m
(1) Assuming investment capacity at 9.0x EV/EBITDA
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d. abertis financial targets
Total available funds
€7,000m 2007-11E Net cash flow generated
€3,750m2007-11E Re-leveraging capacity
+
€10,750m 2007-11E Total available funds
€10,750m of total available funds in the 2007-2011 period, to be invested and deliver returns to the shareholders
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Cash flows generated
Releveraging
Investment capacity 11 B€
Horizon 2011
d. abertis financial targets
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Maximizing business value
Focusing on identified and recognised markets
Yield-oriented
Optimising the result
Risk limitation
Dividends policy both predictable and growing
e. Economic objectives
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Conclusion
Subject to…
The existence of attractive investment opportunities in the already mentioned geographical areas
Keep maintaining a strict investment criteria focused on the profitability (shareholders’ IRR around 10%)
Obtaining major or controlling stakes or being the sole industrial partner
And consolidate the current platform in order to continue delivering sustained growth and profitability