A 0 Profile of the Group in 2015 Obrascón Huarte Lain (OHL) ranks among the leading international concession and construction groups, with more than 100 years of experience and an outstanding presence in more than 30 countries on all five continents. 14 Enlargement of the York-Spadina Metro. Canada.
Sustainability Report 2015 A0 Profile of the Group in 2015 The mission of the OHL Group is the creation of value in conditions of economic, social and environmental sustainability, catering to the specific interests of investors, customers and the employees comprising the Group and other stakeholders. The OHL Group is at the present time: A strategic developer of public-private partnership projects. The thirty-first largest international contractor and the eighth in Latin America*. The reference shareholder of Abertis, world leader in toll roads. A world leader in the construction of hospitals and railways. *Ranking Engineering News Record (ENR) 2015. Millions of Euros Basic figures 2015 Var. 2015-2014 (1) Net turnover (Sales) 4,368.9 20.2% Gross operating result () 967.0-7.0% Total backlog 64,970.2-2.7% Short-term backlog 7,151.6-10.4% Long-term backlog 57,818.6-1.6% Attributable Net Profit 55.6 139.7% Total Net Debt 4,007.0-28.8% Net Recourse Debt 379.4-54.2% (1) 2014 figures re-stated. No. of people at the end of financial year 2015 Var. 2015-2014 Total 25,978 4.2% BUSINESS STRATEGY The OHL Group carries out its business in three major areas of activity: Concessions, Engineering & Construction (OHL Construcción, OHL Industrial and OHL Servicios) and Developments. 15 OHL Concesiones Engineering & Construction OHL Desarrollos Leader in publicprivate partnership projects. 56% stake in the share capital of OHL México. 14% stake in the share capital of Abertis. OHL Construcción OHL Industrial OHL Servicios Reference in the construction of civil infrastructures and unique building construction. Engineering and construction of turnkey industrial facilities. Management of projects in the facilities management and municipal services sector. Integrated management of topquality unique projects in the tourism-hotel sector. OHL Group Report 2015
MILESTONES IN 2015 Implementation of the Strategic Plan 2015-2020. Significant improvement in the financial situation. Capital increase and debt reduction. For OHL, the 2015 financial year has been marked by two very significant milestones: on the one hand, the presentation of the new Strategic Plan 2020 and, on the other, the capital Increase in the amount of 999.1 million euros completed on October 30. These milestones combine to initiate a new stage for the Group, centering it on sustainable cash generation in each of the divisions through the reinforcement of its risk control mechanisms, the re-focusing of its international presence and the strengthening of its capital structure for addressing future growth. IMPLEMENTATION OF THE STRATEGIC PLAN 2015-2020 In March 2015, the OHL Group presented its Strategic Plan 2015-2020. The Strategic Plan is based on two key principles: ensuring cash generation and guaranteeing the sustainability of each of the Group s divisions, with the following main lines of action: Have as the center of gravity and driving force of the Group s future growth the 8 Home Markets in which it operates: Canada, the U.S., the four Pacific Alliance countries (Mexico, Chile, Peru and Colombia), the Czech Republic and Spain. Strengthen the mechanisms of risk management and control. Maintain a balanced and well diversified backlog in terms of: project size, geographical location and type/specialization. Maintain financial discipline and improve the ratio of conversion of into cash. Wager on the human capital, R&D&I and Corporate Social Responsibility as generators of value. 16 Principles and main lines of action of OHL s Strategic Plan Ensure cash generation in each Division Guarantee the sustainability of each Division 1 2 3 4 5 Reinforce OHL s capacities and resources for strengthening the performance of projects and risk control Concentrate business activity in eight Home Markets and balance the size of the projects and the customer portfolio Optimize cash generation ensuring the self-financing of each of the Divisions Double turnover and between 2014 and 2020 with a reduced need for CAPEX Reinforce the OHL Group s commitment to People, R&D&I and Corporate Social Responsibility The OHL Group s Strategic Plan set the target of doubling turnover to reach the 8,000 million euros mark in 2020, and of concentrating 85% of revenues in its eight priority markets (home markets).
Sustainability Report 2015 A0 Profile of the Group in 2015 This strategy will therefore reinforce the presence of the Group on the American continent while maintaining its wager on its traditional European markets, Spain and the Czech Republic. In addition, OHL will seek to develop other markets with the objective of turning them into home markets, such as the Scandinavian countries, Saudi Arabia and the Southeast Asia region. STRATEGY BY BUSINESS AREA The main strategic goal of the Concessions division is the consolidation of its current presence in Mexico and Chile and growth in Colombia and Peru in the short term. Moreover, the Strategic Plan considers a possible expansion of the business to the United States and Canada, with a main focus on the development of transportation infrastructures. Engineering & Construction: OHL Construcción maintains the value enhancement of its extraordinary technical, innovative and quality-of-performance capacities, which have enabled it to perform major projects of high complexity in the civil engineering and unique building construction sectors. OHL Industrial will continue to drive the integrated performance of turnkey projects (EPC), focusing its operations on the electricity generation, mining and Oil&Gas sectors. OHL Servicios is set to commence its international expansion by taking advantage of the synergies with the rest of the Group s divisions in the American home markets. With respect to Developments, the division continues to drive three major projects, which are international references and in different stages of performance: Mayakoba, a luxury tourism project in Riviera Maya (Mexico); Canalejas, urban revitalization in the historic city center of Madrid (Spain), and the Old War Office, a project for the restoration and renovation of the British War Ministry, an important heritage building in London (United Kingdom). In addition, the Strategic Plan reinforces the Group s traditional commitment to the development of its team, investment in R&D&I and its Corporate Social Responsibility activities. SIGNIFICANT IMPROVEMENT IN THE FINANCIAL SITUATION 17 The 2015 financial year was marked by another significant development, the capital increase in the amount of 999.1 million euros. The use of the funds obtained is centered on: Reducing recourse borrowings by an approximate amount of 632 million euros. Providing OHL Concesiones with the funds necessary for undertaking the capital commitments derived from the current concessions, in the amount of 340 million euros. Other significant developments in the financial scope are set our below: The amount of the net recourse borrowings is at a record low, 379.4 million euros, which signifies a net recourse debt/recourse ratio of 1.3x. OHL Group Report 2015
Net organic cash generation in the amount of 46.3 million euros. Improvement both in the average cost as well as in the maturity profile of the Eurobonds. Increase in the recourse borrowing platform and greater financing flexibility in the long term. Significant recourse liquidity position, with 1,918.3 million euros. 2015 RESULTS BY BUSINESS ACTIVITY The 2015 financial year has been characterized on the operating level by an increase in sales in all three divisions of the OHL Group, with 20.2% growth in the Group s total turnover, as set out below: Concessions: strong progress in the business with sales and from tolls increasing 20.7% and 33,6%, respectively, thanks to the good performance of the concessions in Mexico, which grew 26.2% and 42.3%, respectively, in local currency. Engineering &Construction: increased sales by 20% with an figure of 139.5 million euros. Developments: grew 27.2% in sales and obtained 7.7 million euros in. CONCESSIONS Millions of Euros Sales Cash 445 20.5% 820-1.0% 285 33.6% Strong performance based on the positive trend in traffic flows and tolls in the Mexican concessions. 18 declined only slightly by 1%, due mainly to the lower contribution, 80.2 million euros, of the generated by the guaranteed IRR as a consequence of the drop in the inflation rate in Mexico during 2015. OHL Concesiones manages 19 concessions in five countries. Their toll revenues and grew by 20.7% and 33.6% in 2015, respectively Bicentennial Viaduct. Mexico. ENGINEERING & CONSTRUCTION The evolution of the three divisions that make up this area of activity is as follow:
Sustainability Report 2015 A0 Profile of the Group in 2015 CONSTRUCTION Sales Millions of Euros 3,248 16.5% 150-27.3% Improvement in the quality of the profit as a consequence of a higher rate of conversion into cash. Sales were boosted thanks to the good performance of the international operations, particularly in the U.S., Mexico and Middle East. Successful conclusion of the litigation concerning the Oran Convention Center, with the collection of 100 million euros. The division s short-term backlog reached 6,586.5 million euros, representing approximately two years of sales. This backlog is characterized by a balanced profile both in geographical terms as well as with respect to project size, with 82.3% originating in the home markets and only 21% of projects larger than 300 million euros. OHL Construction awarded new contracts amounting to 2220.6 million euros in 2015, 43.6% in the US and Canada Red Vial 4 Toll Road. Peru. INDUSTRIAL Sales Millions of Euros 352 50.3% -21-5.6% 19 Consistent increase in sales and size. Impact of the macro environment on the performance of the division. Award obtained for building a combined cycle plant in Mexico. OHL Industrial achieved in 2015 its first turnkey project of a combined cycle, Empalme I plant 770 MW, awarded in Mexico 35 MW cogeneration plant at the Francisco I Madero Refinery. Tamaulipas, Mexico. OHL Group Report 2015
SERVICES Sales Millions of Euros 199 37.7% 10-10.4% Consistent growth in sales and size. Maintenance of a level of returns above the average for the sector. OHL Servicios-Ingesan has started its internationalization in 2015 in Mexico and Chile, as well as prospecting US market Energy management at the La Princesa University Hospital, Madrid. Spain. DEVELOPMENTS Sales Millions of euros Like-for-like 125 27.2% 8-44.6% 18.5% 20 Strong performance of the operating business with like-for-like growth (excluding the impact of the sale of real estate assets) of 18.5%, as a result of the positive trend in the Mayakoba hotels which, with increasingly higher occupancy rates, confirm the recovery of the tourism sector in Mexico. OHL Desarrollos has three singular assets: Mayakoba, Riviera Maya, Canalejas Centro Madrid and the Old War Office building, in London Old War Office, London. United Kingdom.
Sustainability Report 2015 A0 Profile of the Group in 2015 SUCCESSFUL IMPLEMENTATION OF THE STRATEGIC PLAN In 2015, the main targets of the Strategic Plan were met: Main outcomes of the implementation of the Strategic Plan in 2015 Committed to the principles of the Strategic Plan... 1 Optimize sustainable cash flow generation and the self-financing of all of the divisions 2 Maximize the profitability of projects and the strengthening of the risk control mechanisms 3 New focus of the business activity on priority markets and sectors 4 20% of the total revenues generated by OHL Industrial and OHL Servicios 5 Keep the Net Recourse Debt/Recourse ratio below 2x Recovery of the working capital Creation of a Risk Monitoring Committee 83% of the total sales are generated in the Home Markets +50.3% and +37.7% growth in sales in the Industrial and Services divisions, respectively Recourse gearing at 1.3x... making a positive impact on the 2015 results 21 Josep Piqué, second vice president and CEO of OHL, in the presentation of the Strategic Plan 2015-2020 to the financial analysts. Strategy Update 2020 Grupo OHL Madrid, 2 de marzo de 2015 The OHL Group s 2015-2020 CSR Strategic Plan is based on two key principles: ensuring cash generation and ensure the sustainability of each of its divisions Autopista Urbana Norte (México) OHL Group Report 2015
THE OHL GROUP IN THE WORLD Presence map at December 31, 2015 Norway 32 Czech Republic 2,481 Poland 109 Slovak Republic 261 Slovenia Romania 8 Moldavia Croatia Bosnia Herzegovina Bulgaria 96 Canada 99 United Kingdom Kazakhstan 1 United States 1,716 Spain 9,080 Turkey 68 Argelia 608 Mexico 4,147 Guatemala Colombia 690 Honduras Aruba Vietnam 20 Jordan Kuwait 9 Qatar 410 Oman Saudi Arabia 554 Peru 2,615 Australia 67 Uruguay Chile 2,897 OHL Concesiones OHL Construcción OHL Industrial OHL Servicios OHL Desarrollos 22 Revenues by country in 2015 America Europe Asia Africa Thousands of euros Canada 23,232 Spain 759,830 Turkey 42,269 Algeria 33,000 USA 1,014,033 Norway 3,486 Kazakhstan 7,625 Mexico 738,197 Poland 71,018 Jordan 32,893 Oceania Colombia 97,345 Czech Republic 410,656 Oman 25,158 Australia 56,737 Guatemala 40,532 Slovak Republic 108,606 Qatar 49,522 Uruguay 28,143 Moldavia 3,797 Kuwait 61,029 Others 739 Honduras 905 Slovenia 34,418 Saudi Arabia 262,327 UK Aruba 28,896 Bosnia and Herzegovina 7,430 Vietnam 13,025 Serbia Peru 188,198 Bulgaria 2,024 Croatia Chile 223,796 Romania
Sustainability Report 2015 A0 Profile of the Group in 2015 Section of the Circuito Exterior Mexiquense toll motorway. 23 OHL Group Report 2015