RESULTS FOR THIRD QUARTER 2015 29 October 2015
Content Keys to the period Main figures Profit & Loss Account Breakdown of Sales Breakdown of EBITDA Order Intake and Backlog Breakdown of Backlog Pipeline Balance Sheet Net Cash Flow position Relevant Deeds 2
Keys to the period Sales in the third quarter of 2015 were at 579 million Euros, 4.9% less than the 608 million from the same period the previous year. Accumulated order intake as of 30 amounted to 1,228 million Euros, a significantly higher figure than the 453 million contracted throughout 2014. The most significant contracts were in the Energy division two contracts for gas-fired combined cycle power plants in Brazil for 800 million Euros and a third contract for a cogeneration plant in Chile for 106 million Euros for the National Petroleum Company (ENAP). We could also highlight, in the Oil & Gas business, the signing of a contract for the turnkey delivery of the extension to a liquefied natural gas (LNG) terminal in Zeebrugge (Belgium) for 150 million Euros. Two further contracts were signed in October; one for the construction of a 790MW maritime terminal power plant in Mexico for CFE for 175 million Euros (related to the 50% of the scope of the project); and the other for an LNG maritime terminal in Chile for 158 million Euros, which are not included in the order intake amount given above. Expectations for further contracts are positive, with a very balanced pipeline in terms of geographical and sectoral diversification. The good order intake figures for the year mean that the backlog at 30 2015 is 2,017 million Euros, maintaining the multiple of 2.2x in terms of visibility (approx. 26 months) based on sales in 2014. The new contracts, mainly in countries where DF has already delivered projects (Chile and Brazil), mean that the proportion of LATAM in the geographical composition of the backlog has grown to 53%, while Africa and the Middle East are at 26%, Europe at 15% and Asia Pacific at 5%. By business lines, Energy accounts for 65%, while Mining & Handling and Oil & Gas are at 13%. The PBT is down to 8.4 million Euros (1.5% over sales) and the EBITDA is up to 18.4 million Euros (3.2% over sales), affected by the lower than expected result at the Vuelta de Obligado project (Argentina) and because the margins on the new projects are coming closer to the sector average. The company maintains a prevision for income of 430 million Argentine pesos (43 million Euros) for extra costs and the claim has been lodged with the client - it is currently being negotiated. In any case, the contract contains a clause for resolving disputes by arbitration. 3
Keys to the period The outstanding amounts to collect from the Termocentro project were 92 million Euros as of 30 2015. Payments of 35 million Euros were received in 2015. The Roy Hill project in Australia is still being executed on time in accordance with the calendar. The manufacturing division contributed a positive EBITDA of 4.2 million Euros. The Smart Systems business is evolving favourably and recorded a negative PBT of 1.7 million Euros, a significant improvement in comparison to the 6.4 million Euro losses from the same period the previous year. In terms of the balance sheet, the group has a gross treasury of 263 million Euros and a net debt of 24.7 million Euros - once the leasings for 27.2 million for purchasing the office building have been deducted - due to the use of advance payments for projects that are coming to an end and because of the above-mentioned extra costs the company is paying at the Vuelta de Obligado project, and which are currently being claimed from the client. The company holds 10% of its shares in treasury stock, which as of 30 has a value of 33.1 million Euros. Investment in diverse assets has been made over the year for a value of 25.5 million Euros. 4
Main figures In thousands of Euros Backlog 2,016,763 M (26 months) Sales 578,948 M Net debt (*) 24,736 M EBITDA 18,355 M Net profit 6,720 M (*) See Keys for the period 5
Profit & Loss Account In thousands of Euros 2015 2014 Sales 578,948 608,459-4.9% EBITDA 18,355 41,813-56.1% EBITDA Margin 3.17% 6.87% PBT 8,415 38,106-77.9% PBT Margin 1.45% 6.26% PAT 5,574 31,457-82.3% Minor shareholders -1,146 2,438-147.0% NET PROFIT OF PARENT COMPANY 6,720 29,019-76.8% % 6
Breakdown of Sales 2015 2014 % Energy 229,387 279,419-17.9% sep-15 8% 4% Mining & Handling 152,292 156,250-2.5% Oil & Gas 57,013 59,477-4.1% Services 73,713 46,598 58.2% Manufacturing 45,355 56,330-19.5% 13% 10% 39% Other 21,188 10,385 104.0% TOTAL 578,948 608.459-4.9% In thousands of Euros The group turnover is slightly down with similar levels to 2014 Energy Oil & Gas Manufacturing sep-14 26% 2% Mining & Handling Services Other 9% 7% 10% 46% 26% 7
Geographical breakdown of Sales 2015 2014 Latam 196,911 239,936 Spain 59,658 70,828 sep-15 22% 1% 34% Rest of Europe 101,168 119,723 Africa and Middle East 88,869 49,245 15% Asia Pacific 126,384 121,188 Other 5,958 7,539 18% 10% TOTAL 578,948 608,459 In thousands of Euros Latam Rest of Europe Asia Pacific Spain Africa & Middle East Other sep-14 Group sales are similar to the previous quarters with a balanced geographical diversification. The lower proportion of Latin America is offset by greater sales in Asia Pacific and Africa and the Middle East. 8% 20% 1% 39% 20% 12% 8
Breakdown of EBITDA EBITDA EBITDA margin 2015 2014 % 2015 2014 Energy -8,921 23,889-137.3% Mining & Handling 13,324 5,041 164.3% Oil & Gas 1,592 6,163-74.2% Services 10,966 8,879 23.5% Manufacturing 4,175 6,313-33.9% Other -2,781-8,472 67.2% TOTAL 18,355 41,813-56.1% In thousands of Euros -3.9% 8.5% 8.7% 3.2% 2.8% 10.4% 14.9% 19.1% 9.2% 11.2% -13.1% -81.6% 3.2% 6.9% Energy: the margin was affected by the negative impact of the Vuelta de Obligado project (Argentina) Mining & Handling: The EBITDA margin improved by 7.5 million Euros from positive exchange differences Oil & Gas: the Zeebrugge project (Belgium) is in its initial stages and did not contribute a significant margin the period Manufacturing: still on track with the positive margins as started the previous year Other: an improved result in the Smart Systems business and general corporate expenses 9
Order intake and Backlog Evolution of order intake 1,228 890 786 649 1,167 668 809 573 287 225 118 76 81 62 61 3T 2011 3T 2012 3T 2013 3T 2014 3T 2015 (*) Domestic International Evolution of backlog 1,607 1,635 2,079 1,530 2,017 (*) 1,492 1,568 2,026 1,473 1,958 115 67 53 57 59 2011 2012 2013 2014 3T 2015 In millions of Euros Domestic International (*) This does not include the two new contracts signed in October for a 790 MW combined cycle power plant in Mexico for CFE for 175 million Euros and an LNG maritime terminal in Chile for 158 million Euros. 10
Breakdown of Backlog Geographical 2015 Latam 1,072,096 5% 1% Latam Spain Spain 58,516 26% Rest of Europe Rest of Europe 249,765 Africa and Middle East 532,650 53% Africa & Middle East Asia Pacific Asia Pacific 96,421 Other Other 7,315 12% Total 2,016,763 3% In thousands of Euros By business division 2015 2% 4% 3% Energy 1,311,786 Mining & Handling 257,448 Oil & Gas 259,678 Services 56,789 Manufacturing 85,779 Other 45,283 13% 13% 65% Energy Mining & Handling Oil & Gas Services Manufacturing Other Total 2,016,763 In thousands of Euros 11
Pipeline The pipeline of bids presented and under preparation is the most diversified in all DF s history Canada United Kingdom Mexico USA Morocco Germany Spain Croatia Algeria Egypt Saudi Arabia Kazakhstan Turkmenistan UAE, Kuwait Oman Panama Colombia Senegal Ghana Nigeria Ethiopia Malaysia Energía Brazil Chile UAE Kuwait Mexico Panama United Kingdom Senegal Peru Chile Brazil Mining & Handling Algeria Australia Brazil Canada Chile Spain Ethiopia Indonesia Nigeria Peru South Africa Kenya Mozambique Oil & Gas Saudi Arabia Brazil Chile Colombia Croatia UAE Egypt Morocco Mexico Mozambique Oman Panama Peru United Kingdom Indonesia Australia 12
Pipeline In millions of Euros 23,554 12,141 10,231 6,231 7,309 2,518 4,143 11,413 1,580 1,482 1,370 3,713 492 2,661 2,921 340 1,088 1,030 Energía Mining & Handling Oil & Gas Servicios Fabricación y Otros Total Distribution by geographical area (%) NORTH AMERICA * 19 5 EUROPE 6 8 ASIA PACIFIC Bids presented 11,413 Bids under preparation 12,141 LATAM 47 AFRICA & MIDDLE EAST 32 21 1 5 Total Bids 23,554 56 * USA and Canada Bids presented Bids under preparation 13
Balance Sheet ASSETS 2015 December 2014 % Non-current assets 224,057 202,055 10.9% Fixed assets 112,062 113,356-1.1% Current assets 799,722 842,454-5.1% Cash and equivalent 263,413 354,270-25.6% LIABILITIES 2015 December 2014 % Net worth 240,017 260,348-7.8% Distributable income 7,820 8,239-5.1% Non-current liabilities 225,946 192,030 17.7% Long term financial debt 207,902 174,075 19.4% Current liabilities 549,996 583,892-5.8% Short term financial debt 80,247 60,589 32.4% TOTAL 1,023,779 1,044,509-2.0% Financial debt/worth ratio 120.05% 90.13% Working capital 249,726 258,562-3.4% In thousands of Euros 14
Net Cash Flow Free Cash Flow: -126.7 Working Capital (*) 18.4-114.3 119.6 EBITDA Tax & Interest -8.7 Interest received 33.1 Treasury Stock (**) Others & Adjustments Net Cash Flow 31 Dec 2014-25.5 Investment (***) 3.4 17.8 Dividends 0.2 24.7 Net Debt 30 Sep 2015 (*) Changes in working capital: stock, commercial debtors and creditors (**) The value of the treasury stock as of 30 2015 amounted to 33.1 million Euros (***) Investment consists mainly of the adaptation and extension of the office building and manufacturing facilities and the investment made in Ausenco. In millions of Euros 15
Relevant Deeds On 27 February the company notified the Board of Directors agreement to distribute a third dividend for 2014 for a gross global amount of 0.04 Euros per share to be paid on 17 March 2015. On 27 February the company issued information about the results of 2014, the annual corporate report and the annual Board of Directors compensation report. On 1 April the company notified the winning of the contract for the turnkey execution of the extension to the liquefied natural gas (LNG) terminal at Zeebrugge (Belgium). On 29 April the company issued information about the results of the first quarter of 2015. On 12 May the company sent out the call for the Annual General Meeting to be held on 25 June 2015. On 20 May the company announced the award of the contract to deliver a cogeneration plant in Chile. On 25 May the company announced the award of two contracts to deliver two gas fired power plants in Brazil. 17
Hechos significativos On 10 June notification was made of the Board of Directors decision to re-elect the auditors to be transferred to the Annual general Meeting. On 25 June the company sent the agreements adopted by the Annual General Meeting held in Oviedo. On 25 June the decision of the Annual General Meeting was notified, by which the payment of a complementary dividend against the results of 2014 for an amount of 0.04 Euros gross per share was approved, to be paid on 20 July. On 10 July the company notified the acquisition of 5.029% of the Australian company Ausenco Limited. On 21 July the agreement to underwrite a capital increase of 17,808,087 shares in the Australian company Ausenco Limited was announced, which together with the stake already bought would lead to a total shareholding of 14.5% of the company s capital stock. On 29 July the company announced the change in the Presidency of the Auditing Committee. On 31 August the company notified the agreement with the Board of Directors to pay a first dividend against the results of 2015 for a global gross amount of 0.02 Euros per share to be paid on 17 2015. 18
Relevant Deeds On 31 August the company sent information about the results of the first quarter of 2015. On 3 the company notified the text of regulations for the Annual General Meeting after the changes approved at the latest Board meeting. On 25 an announcement was made concerning winning the contract with Puerto Ventanas, S.A. for the extension, revamping and modernization of the new Copper Concentrate Embarking System at Bahía de Quintero (Chile), signed with Puerto Ventanas, S.A. On 29 the company notified the registration of of the changes to the regulations for the Annual General Meeting at the Business Registry of Asturias. On 6 October the company notified the winning of the contract to deliver the Penco Lirquén LNG Terminal project in Chile, signed with the Chilean company Octopus LNG SpA. On 24 October the company notified the award to Duro Felguera, in a 50/50 consortium with Elecnor, of the contract for the delivery of the Empalme II combined cycle power plant in the State of Sonora (Mexico). 19
Limited responsibility This document has been drawn up by DURO FELGUERA for exclusive use in presentations of the company s results. This document may contain previsions or estimates of the evolution of the company s business and results. These previsions reflect the opinion and future expectations of DURO FELGUERA, and as such are subject to risk and uncertainty which could lead to the real results being significantly different from said previsions and estimates. What is set forth in this document should be taken into account by everybody and all entities who might have to take decisions or draw up and publish opinions about DURO FELGUERA securities, and in particular by analysts who read this document. It is hereby stated that this document may contain summarized or non-audited information. This document does not constitute an offer or an invitation to subscribe or purchase any securities, and neither this document nor its content shall be the basis for any contract or commitment. 20
Contact Should you require any further information, we would ask you to contact accionistas@durofelguera.com providing the name of your entity, contact person and e-mail address or telephone number. 20