Ferrovial Investing for Growth 1H 2015 1
Human Resources Environment FY2014 figures 70% MALE 69,088 Workforce 30% FEMALE 43.3 AVERAGE AGE 43.8 8.9 YEARS OF SENIORITY 9.5 77% PERMANENT CONTRACT 81% 85% MANAGEMENT 15% 2.9% 0.6% ROTATION INDEX 67% 33% NEW RECRUITMENTS -39 Reduction of greenhouse gas emissions 2009-2014 Spain 54% Turnover index: 3.6% Present in 25 countries UK 27% America 4% Poland 6% Employee education commitment Total training hours: 1,281,414 Hours per employee: 19 Investment per employee: 258 % of Co revenue: 0.20% RoW 9% 17 Of electricity consumed by ferrovial came from renewable sources 100 in the case of Amey 2
3 Ferrovial Overview & Strategy
What is Ferrovial? DESIGN & CONSTRUCTION Construction MAINTENANCE Services EX-INFRASTRUCTURE PROJECTS Toll roads INFRASTRUCTURE PROJECTS OPERATION Airports 4 Design, Financing, Construction, Operation & Maintenance of infrastructure assets & Provider of services to cities STRATEGY 1. CF Generation 2. Profitable Growth 3. Shareholder Remuneration
1. Cash Flow Generation million 2014 figures 349mn EBITDA from Construction 387mn EBITDA from Services EX-INFRASTRUCTURE PROJECTS Net cash position Non capital intensive / Backlog visibility / EPS accretive PARENT COMPANY Controlling Shareholder 43% Free float 57% 341mn Dividends from Airports 255mn Dividends from Toll roads INFRASTRUCTURE PROJECTS Ring fenced debt Capital intensive / Inflation protected / LT duration & financing 5
1. Cash Flow Generation: sources and uses million c70% of OCF from UK, Canada & US Balanced contribution from all businesses 31% 22% 21% 26% Construction Service Toll Roads Airports Sources & Uses OPERATING CASH FLOW FY2014 Construction Services Toll Roads (dividends) Airports (dividends) Taxes & Other TOTAL 2014 figures 2014 236 302 255 341 (58) 1,076 Operating CF Other 6 Investment Dividends & Buy-back Interests
2. Profitable growth. Solid Financial Situation million 1H 15 figures EX INFRASTRUCTURE PROJECTS NET CASH 1,450mn mn Net debt evolution ex-infrastructure projects 907 31 1,987 1,547 1,172 3,064 1,484 1,663 1.632 1.450 2006 2007 2008 2009 2010 2011 2012 2013 2014 1H 15 PARENT COMPANY INFRASTRUCTURE PROJECTS TOLL ROADS* 7,217mn NET DEBT 7,650mn * 1,483mn related to LBJ & NTE 35W, toll roads under construction. mn Debt maturities ex-infrastructure projects 813 502 141 37 47 10 2015 2016 2017 2018 2019 >2020 7
3. Shareholder remuneration (CF Criteria) per share Scrip Dividend million Evolution 2014 Strong growth in shareholder remuneration Scrip dividend eq. to 2013 complementary (Jul 14) 0.291 917 Scrip dividend eq. to 2014 interim (Nov 14) 0.381 TOTAL paid in 2014 0.672 2015 282 308 367 477 510 Scrip dividend eq. to 2014 complementary (May 15) 0.304 Scrip dividend eq. to 2015 interim (TBC) +81% 2009 2010 2011 2012 2013 2014 Share Buyback 2014: 235mn 2015: up to 250mn (To be executed May 26th to November 18th 2015) 8
Ferrovial today: 1H 15 Results Double digit revenues (+14%) & EBITDA (+24%) Supported by operational performance & FX impact Significant traffic growth at key assets Airports, Highways (Canada, US, Europe) on the back of: Better weather conditions vs 1H 14 Lower oil prices Economic recovery since 2H 14 Strong EBITDA performance of Eq. Ac. assets 15.3% 407 ETR HAH +10.2% AGS +11.6% (all in local FX) Higher dividends from 407ETR & Heathrow +7% & +11%, respectively ( 170mn for Ferrovial) First dividends from UK regional airports: GBP25mn. Strong construction & services backlog A combined 31.5bn (including JV) New projects awarded Toowoomba 2nd Range Crossing (Australia) c. 1.100mn investment, 25Y duration from opening Bucaramanga-Barrancabermeja (Colombia) 880mn investment, 25Y duration from signing Strong financial position Net cash (ex-infra projects) at 1,450mn Reducing borrowing costs & extending maturity A-66 Benavente-Zamora, (Spain) issued 185mn, 26Y, at 3.169% Heathrow issued c. 1,100mn: 750mn, 15Y, at 1.5% & CAD500mn at 10Y, at 3.25%) ETR407 issued CAD650mn: CAD150mn (30Y at 3.30%) & CAD500mn (31Y at 3.83%) Liquidity Line increased & extended : 1.3bn (5Y, 50bps) Financial close of new toll roads: 407 East Partial Extension Phase 2 (Canada) CAD880mn, 30Y duration from opening I-77 (North Carolina) $648mn, 50Y duration from opening Cash generation Seasonal Working Capital variation ex-infra in line with Jun 14 -EUR408mn vs. EUR-339mn in H1 14 No factoring (EUR 118mn Dec 14) No Suppliers Payment Program (EUR75mn in H1 14) Higher divs from projects: EUR206mn vs. 165mn in 1H 14 Higher investment: EUR153mn vs. 82mn in 1H 14 Higher shareholder remun: EUR165mn vs. 65mn in 1H 14 9
Toll roads: traffic growth and new concessions awarded million 117mn dividends from 407ETR (+7%) Traffic growth across our portfolio Canada, US & Europe (Ireland, Portugal and Spain) Traffic growth despite increase in tariffs: Chicago Skyway: ETR407: +0.4% with +13.2% in tariffs +2.9% with c.+10% in tariffs NTE Managed Lanes (9 months of operations) EBITDA +46%, traffic +24% vs 1Q 15 Financial close: I77, North Carolina, US (Managed Lanes) 407 East extension phase II, Canada New project awarded: Toowoomba Second Range Crossing (Australia) Bucaramanga-Barrancabermeja-Yondó (Colombia) Other relevant events: OLR deconsolidated: non-cash positive impact of 63.7mn ITR disposal: $50mn in 1H 15 for Ferrovial Active pipeline: Bidding in US / Australia / Canada Monitoring of opportunities in other markets TRAFFIC GROWTH Canada 407ETR +2.9% 1H 15 % 1H 15 figures Revenues 245 +22.7% EBITDA 166 +34.9% 159 Ireland M4 +6.3% Portugal Algarve +10.8% Dividends from projects 220 242 255 USA Chicago +0.4% SH130 +17.1% Spain Ausol I +10.7% 120 10 2011 2012 2013 2014 1H'15
407ETR CAD million 407-ETR Equity method, Ferrovial stake 43% NTE USD NTE 1-2 Texas 1H 15 figures 56.7% Global consolidation +2.9% traffic despite c.+10% in tariff (Feb 2015) Dividend up +7% Revenues +13.9% EBITDA +15.3% EBITDA +46% vs 1Q 15 to $12.5mn Traffic up +24% vs 1Q 15 The avg. tariff per transaction was $2.51 (+5%) 27,1X Net debt / EBITDA Average tariffs (peak hours) Segment 1 Segment 2 +0.3% +2.7% 8,1X $2,9 $2,9 $3,3 $3,4 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 1Q'15 2Q'15 1Q'15 2Q'15 300 460 Dividends 600 680 730 375 Maximum tariffs Segment 1 Segment 2 +28% +34% $5,3 $4,2 $4,3 $5,7 2010 2011 2012 2013 2014 1H'15 1Q'15 2Q'15 1Q'15 2Q'15 11
Services: Backlog continues to reach new record highs million 1H 15 figures Strong revenue growth LfL Spain +6.1%, UK +1.8% & International +30.9% Accounting margins in line with 1H 14 at 7.5% New all-time high backlog 23,810mn (Including JV) UK backlog represents 72% Spain: Revenue growth of over 6% Increased profitability: EBITDA margin 11.5% vs 10.8% in 1H 14 EBITDA: +13% organic UK: Revenue growth helped by GBP appreciation (+2% LfL) Margins better than 1Q2015, at 5.3% (vs 4.7% in 1Q) 1H margins impacted by: Seasonality, worse weather conditions in winter New project start-up costs Higher costs on finalization of investment phase in Birmingham contract Higher backlog: +11.4% to 17bn (+2% LfL) 1H 15 % Revenues 2,380 +12% EBITDA 178 +12% EBITDA % 7.5% = Backlog 23,810 +6% Performance by geography UK SPAIN +15% +9% +11% Revenues EBITDA Backlog +6% +14% -5% Operating cash flow 495 359 302 164 FY 14 2011 2012 2013 2014 12
Construction: +22% in international revenues million 1H 15 figures International represents 78% of total revenues Strong performance of international revenues (+21.8%) Improved profitability Driven by end of projects & strong Budimex margins (5.5%) Strong growth in Poland (Budimex) Revenues +13.4% (+11.9% LfL) EBITDA +51.0% (+48.7% LfL) Backlog +17% vs Dec 14 (+14.5% LfL) Backlog -5% (-9.0%LfL) 1.300mn to be included Civil works represents 78% International backlog represents 77% Maintaining selective criteria as regards tendering projects 1H 15 % Revenues 2,105 +17% EBITDA 197 +29% EBITDA % 9.4% +88bp Backlog 7,690-5% Operating cash flow 298 304 FY14 figures 236 100 2011 2012 2013 2014 Budimex Order Backlog (PLNbn) Backlog by country 6,1 +14% 7,0 23% 22% 24% 10% 22% 2014 1H 15 España Polonia USA Reino unido Resto 13
Heathrow: New record number of passengers Equity method, Ferrovial stake 25% 1H 15 figures Strong intercontinental traffic growth North America: increased frequencies Middle East with increased flights & larger aircrafts LatAm: Avianca new Colombia service, growth in Brazil and Mexico Vietnam Airlines moved to Heathrow Short haul led by European flights European +2.4% growth reflects BA seat capacity increase Increased dividends to shareholders GBP150mn (+11%) Heathrow capacity expansion proposal recommended by Independent Commission. Government decision expected before year end UK Regional Airports (AGS): Equity method, Ferrovial stake 50% Traffic: EBITDA +11.6% +7.4% YoY reached 6.5mn passengers First dividend paid to shareholders Heathrow passenger traffic (1H15 vs 1H14) North America 8.1mn +1.4% Latin America 0.6m +10.6% UK 2.5m +1.8% Africa 1.6m -6.8% Europe 14.7m +2.4% M. East 3.0m +2.5% Asia Pacific5.05m -1.1% 35.5mn passengers (+1.3%) GBPmn 1H 15 % Revenues 1,308 +6% EBITDA 749 +10% EBITDA % 57.3% +210pb Net debt 12,706-2% Heathrow Shareholders 25% 20% 12,6% 11,2% 11,2% 10% 10% Ferrovial Qatar Brittania GIC Alinda CIC USS 14
Best ever passenger service levels 1H 15 figures Quarterly passenger satisfaction Passenger satisfaction European ranking ASQ score (out of 5) 4,20 4,00 3,80 3,60 3,40 Q4 2006 H1 2015 ASQ score (out of 5) 4,30 4,10 3,90 3,70 3,50 H1 2015 4,12 3,20 3,30 Q4-06 Q2-07 Q4-07 Q2-08 Q4-08 Q2-09 Q4-09 Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14 Q2-15 LHR Heathrow European top quartile European average European competitors European comparators Departures within 15 minutes of schedule Baggage performance connect rate 78% 81% 80% 96,0% 98,1% 98,1% 98,3% 63% 2007 2014 H1 2014 H1 2015 2007 2014 H1 2014 H1 2015 Best Airport in Western Europe 2015 World s Best Airport Shopping 2010, 2011, 2012, 2013, 2014, 2015 Terminal 5 World s Best Airport Terminal 2012, 2013, 2014, 2015 Europe s best airport 2015 (over 25mn passengers) 15
Thank you 16 Ferrovial Investor Relations E-mail: ir@ferrovial.es Tel: +34 91 586 27 30
Appendix Introduction to 407ETR Toll road Managed Lanes Toll roads 17
407 ETR Location Area of expansion 407 East extension High density population area 407 Ring road of Toronto 108 km 18
407 ETR All Electronic Roadside Tolling System Sophisticated electronic toll highway NO toll-booths, closed ticket tolling scheme (on/off ramps) NO stopping or slow-downs to pay ALL vehicles able to use highway Transponder not required. If valid transponder is not detected, digital images are taken at entry and exit and invoices posted to registered car owner Tolls billed monthly 19
Fast Safe Reliable 407 ETR LOCATION Greater Toronto Area 23% of Canada population HIGH HOUSEHOLD INCOME 46% higher than Canada average SPEED Alternatives routes 40kph vs 100kph at 407 NO REGULATORY REVIEWS During concession life (99 years) TRAFFIC Alternatives routes are highly congested TOLL RATE HIGH FLEXIBILITY Including segment, direction, time of the day NON-STOP TOLL FACILITY Fully electronic with interchanges every 3km FAST Reliable travel times 20
407 ETR Cash flow and valuation overview Cash Generation (1999-1H 15) 407 ETR Valuation (100%) million million Initial equity investment (62%) (326mn) Dividends (00 1H 15) 1,391mn 10% disposal 640mn 100% pay-back in first 10 years 27x 13.962 NET CASH IN 1,705mn Valuation x24 525 1999 1H'15 Maturity 2,098 83 years to maturity Strong dividend flow Equity valuation sharp increase 21 * June 2015 analysts consensus
407 ETR Financial overview ($CAD million) 2014 figures Revenues Capital Expenditure CAGR: 8.7% 888 97 90 72 77 88 70 74 55 420 83 years to maturity 49 38 2005 2014 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 OPEX Dividends CAGR: 4.3% 152 680 730 600 104 100% pay-back in first 10 years 460 300 85 145 120 135 190 2005 2014 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 EBITDA Net Debt / EBITDA X 316 75% 77% 79% CAGR: 9.8% 736 83% 83% 83% 83% 82% 80% 76% Free-tariff revision 8% CAGR 02-15* 27,0X 8,1X 22 2005 2014 * Tariff increase for light Vehicles in Peak hours regular zone (%) 1999 2014
Appendix Introduction to 407ETR Toll road Managed Lanes Toll roads 23
Managed Lanes New assets landmark Express Tollway within an Existing Highway Free Lanes Tolled Lanes Speed >50mph Free Lanes A solution to congestion on existing urban corridors by means of Active management of newly added capacity through tolling 24
Managed Lanes Level of demand NTE (untolled) 407ETR (tolled) Peak period Time of the day Westbound Eastbound 00.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 18.00 20.00 22.00 24.00 12.00 2.00 4.00 6.00 8.00 10.00 12.00 2.00 4.00 6.00 8.00 10.00 12.00 Time of the day 25
Paying for predictability Travel time variability 70 60 50 40 Time (min) 30 20 Time (min) Free Flow Travel Mean 10 0 NB AM NB MD NB PM SB AM SB MD SB PM NB - North bound SB - South bound Free flow time of 14 minutes at 6.00am The average travel time during all time periods is significantly higher In some periods, the average travel time is double the free flow speed and can go up to almost 50 60 minutes 26 Data Source: Travel Time Runs Seg 3a and 3b conducted Fall 2012
Dallas and Fort Worth Regional Map Managed Lanes regional map LBJ NTE 1-2 NTE 35W 27
Managed Lanes North Tarrant Express Opened on October 4 th, 9 months ahead of schedule Key characteristics DESCRIPTION: Dallas-Fort Worth Metroplex, Major thoroughfares between Fort Worth and DFW Airport LENGTH: 13 mile section (IH 820 & SH 183 in Tarrant County) CONCESSION PERIOD: 52 years TARIFF POLICY: Open Road Tolling System (no toll booths) with a dynamic tolling regime (every 5 minutes) to maintain at all times a minimum speed of 50 mph No toll-booths, fully electronic free flow tolling system Tollway within a freeway: Motorists will be provided with a choice of driving in non-tolled GP lanes or paying a toll to bypass such GP lanes Tolls setting to ensure minimum speed on new lanes As demand grows and capacity becomes scarce, pricing power increases Physically separated from the GP lanes with controlled access CINTRA Shareholder structure 57% 33% 10% Financial structure MERIDIAM DALLAS FIRE&POLICE PENSION SCHEME 21% 52% 27% EQUITY DEBT PUBLIC FUNDS 28
Toll rates tariff threshold Tariff threshold Toll Rate Toll Rate Cap 0.75 c/mi Speed Demand threshold Speed Threshold 3300 pce/h 2-lane sections 50 mi/h Demand 12:00 1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 Hour starting Analysis by segment and direction Freedom under the cap TOTAL FREEDOM Freedom under the cap 29
Managed Lanes Lyndon B Johnson Construction expected to be concluded in 2015 Key characteristics DESCRIPTION: IH 635 (Dallas County), the most populous county in Texas 108Km Electronic toll LENGTH: CONCESSION PERIOD: 13 mile section of the IH 635 and IH 35E 52 years TARIFF POLICY: Open Road Tolling System (no toll booths) with a dynamic tolling regime (every 5 minutes) to maintain at all times a minimum speed of 50 mph No toll-booths, fully electronic free flow tolling system Shareholder structure Tollway within a freeway: Motorists will be provided with a choice of driving in non-tolled GP lanes or paying a toll to bypass such GP lanes Tolls setting to ensure minimum speed on new lanes As demand grows and capacity becomes scarce, pricing power increases Physically separated from the GP lanes with controlled access 51% 42% 7% CINTRA MERIDIAM Financial structure 25% 54% 20% DALLAS FIRE&POLICE PENSION SCHEME EQUITY DEBT PUBLIC FUNDS 30
Managed Lanes North Tarrant Express 35W Expected to open in mid-2018 Key characteristics DESCRIPTION: 2 managed lanes in each direction of the IH-35W, segments 3A and 3B (3B segment to be built by TxDOT) LENGTH: 10.2 mile section (segments 3A 6.2 miles and 3B 4 miles) CONCESSION PERIOD: 48 years TARIFF POLICY: Open Road Tolling System (no toll booths) with a dynamic tolling regime (every 5 minutes) to maintain at all times a minimum speed of 50 mph The corridor south to the 3A segment is currently ranked as the most congested roadway in Texas. No toll-booths, fully electronic free flow system Tollway within a freeway: Motorists will be provided with a choice of driving in non-tolled GP lanes or paying a toll to bypass such GP lanes Tolls setting to ensure minimum speed on new lanes As demand grows and capacity becomes scarce, pricing power increases Physically separated from the GP lanes with controlled access 50% 26% 14% 10% CINTRA Shareholder structure APG Financial structure MERIDIAM 32% 59% 9% EQUITY DEBT PUBLIC FUNDS DALLAS FIRE&POLICE PENSION SCHEME 31
Managed Lanes Financial Overview 2014 figures Figures in US Dollars Total Investment: 2.10 bn 2.80 bn 1.41 bn Private Equity: Cintra: Meridiam: DPFPS: APG: 21% 427 m 243 m (57%) 141 m (33%) 43 m (10%) 24% 672 m 343 m (51%) 285 m (42%) 44 m (7%) 31% 430 m 216 m (50%) 60 m (14%) 43 m (10%) 112 m (26%) Total Debt: 52% 1,102 m 56% 1,582 m 60% 847 m PABs: TIFIA: 398 m 704 m 606m 976 m 274 m 573m Public Funds: 27% 573 m 19% 490 m 9% 126 m First combination of TIFIA and tax exempt PABs. First private activity bond issuance for a toll road. First time that a U.S.-based pension fund made a direct investment in a highway concession. First privately-financed road development project of its kind to reach financial close in 2010. Texas third big recent road project to reach financial close since 2008. Very competitive capital structure in spite of the difficult market conditions. Strong portion of the debt from TIFIA program with its flexible amortizing structure during the first 25 years. 32
Ferrovial today: 1H 15 Results 33
1H 15 Results million Income Statement Revenues JUN 14 1H 15 1H 14 Var% LfL% 1H 15 1H 14 VAR.% LfL% Revenues EBITDA EBITDA margin Period depreciation EBIT 4,736 538 11.4% 136 402 4,159 435 10.5% 120 315 13.9% 23.6% 27.7% 5.7% 12.4% 13.1% Construction Airports Toll Roads Services Others Total 2,105 3 245 2,380 3 4,736 EBITDA 1,804 3 200 2,125 28 4,159 16.7-9.6 22.7 12.0-89.6 13.9 7.9-9.6 20.2 3.8-89.8 5.7 1H 15 1H 14 VAR.% LfL% EBIT margin Disposals & Impairments Financial results Equity-accounted affiliates EBT Corporate income tax 8.5% 58-207 55 308-50 7.6% 0-167 49 197-52 Construction Airports Toll Roads Services Others Total Construction backlog Services backlog 197-8 166 178 5 538 153-7 123 158 8 435 Operating Indicators 28.8-17.0 34.9 12.4-33.1 23.6 1H 15 DEC 14 7,690 8,091 23,810 22,369 13.9-17.0 31.8-0.5-33.8 12.4 VAR% -5.0 6.4 CONSOLIDATED NET INCOME Discontinued operations Minorities NET INCOME ATTRIBUTED 258-9 267 146-23 168 58.6% Traffic evolution ETR-407 (VKT) Chicago Skyway (ADT) Ausol I (ADT) Ausol II (ADT) M4 (ADT) Heathrow (million passengers) AGS (million passengers) 1H 15 1,178,151 37,919 11,415 13,877 27,277 35.5 6.5 1H 14 1,145,192 37,755 10,315 12,764 25,653 35.1 6.1 VAR% 2.9 0.4 10.7 8.7 6.3 1.3 7.4 34
Diversified portfolio million 1H 15 figures Ex Infrastructure Projects Infrastructure Projects Services Construction Toll Roads Airports Non Capital Intensive PROFIT GENERATION CASH GENERATION Fully consolidated Method 538Mn 33% 37% -2% 31% EBITDA Services Toll Roads Construction Airports Capital Intensive LONG DURATION LONG TERM VALUE Proportional (1) 903Mn 30% 31% 17% 21% 41% Spain 10% UK 40% US & Canada 9% RoW 23% Spain 38% UK 35% US & Canada 5% RoW 35 (1) Proportional: All EBITDA figures are aggregated in a proportional basis to the Ferrovial equity stake in each company or project (mainly ETR 407 toll road in Canada and UK airports).
Disclaimer This document may contain statements that constitute forward looking statements about the Company. These statements are based on financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations, which refer to estimates regarding, among others, future growth in the different business lines and the global business, market share, financial results and other aspects of the activity and situation relating to the Company. Such forward looking statements, by its nature, are not guarantees of future performance and involve risks and uncertainties, and other important factors that could cause actual developments or results to differ from those expressed in these forward looking statements. Analysts and investors, and any other person or entity that may need to take decisions, or prepare or release opinions about the securities issued by the Company, are cautioned not to place undue reliance on those forward looking statements which speak only as of the date of this communication. They are all encouraged to consult the Company s communications and periodic filings made with the relevant securities markets regulators and, in particular, with the Spanish Securities Markets Regulator. 36