january - december 2012 results

January - December 2012

Results

1

A I R P O R T S M O T O R W A Y S C O N S T R U C T I O N S E R V I C E S

INDEX

GENERAL OVERVIEW ....................................1 Cash generation .......................................1 Business performance ...............................1 Financings ...............................................1

MOTORWAYS ...............................................2 Traffic performance ..................................2 Other important matters ...........................3 Contract awards .......................................3 Tenders ...................................................3 407-ETR ..................................................4

SERVICES ....................................................5 Businesses in Spain ..................................5 AMEY ......................................................5 Backlog ...................................................5

CONSTRUCTION ...........................................6 Backlog ...................................................6 Markets ...................................................6 Budimex ..................................................6 Webber ...................................................6 Other markets ..........................................6

AIRPORTS ...................................................7 Traffic performance ..................................7 Tariffs .....................................................7 Income statement ....................................8 Regulatory matters ...................................8 Net debt ..................................................9 Bond issues and refinancings .....................9 Dividends ................................................9 Disposals .................................................9

CONSOLIDATED INCOME STATEMENT ......... 10 BALANCE SHEET AND OTHER MAGNITUDES . 12

Consolidated net debt ............................. 13 Corporate credit rating ............................ 13 Corporate bond issuance ......................... 13

Consolidated Cash Flow ............................... 14 Cash Flow Excluding Infrastructure Projects

............................................................ 15 Cash Flow for Infrastructure Projects ........ 16

APPENDIX I: SIGNIFICANT EVENTS ............. 17 Events after the close ............................. 18

APPENDIX II: PRINCIPAL CONTRACT AWARDS

................................................................ 19 APPENDIX III: EXCHANGE-RATE MOVEMENTS

................................................................ 20 Comparable information: Income statement analysis in like-for-like terms responds to the need to have an accurate picture of the performance of the underlying business. The principal adjustments made to achieve this comparable analysis is the elimination of fair-value adjustments (hedging, impairments and asset revaluations), Exchange-rate movements and changes to the consolidation perimeter. *EBIT For the purposes of analysis, all the comments referring to EBIT are before impairments and disposals of fixed assets

GENERAL OVERVIEW

CASH GENERATION Operating cash flow, excluding infrastructure projects, increased by 78% to EUR909mn (vs. EUR510mn in

2011).

This significant increase was thanks to higher dividends received from the 407ETR (EUR198mn vs.

EUR133mn), the start of dividend distribution by Heathrow Airport Holdings (HAH) (EUR143mn) and

strong cash flow from the Services division (an all-time high of EUR491mn), three times the figure for the

previous year (EUR164mn).

This strong cash generation was supported by the strength of demand at the principal infrastructure

assets. Both Heathrow (LHR) and the 407ETR motorway closed the year with all-time highs for traffic, in

spite of significant increases in tariffs (LHR +12.7%, 407ETR +8.5%).

16.34% of HAH was divested in 2012 (10.62% sold to Qatar Holding and 5.72% to CIC International), for

a total EUR894mn.

Thanks to the strong cash generation and the disposals, the net cash position ex infrastructures (NCP)

improved for the sixth consecutive year, to EUR1,489mn (vs. EUR906mn in 2011).

This improvement in the NCP was after dividend distribution of EUR832mn (EUR367mn in 2011).

BUSINESS PERFORMANCE Revenues for the period reached EUR7,686mn with EBITDA of EUR927mn, up 13%.

At the Motorways division, there were signs of recovery in the USA after a prolonged period of declining

traffic, especially as regards heavy traffic. In Europe, the tariff increases partially made up for the

reduced traffic.

The Services division proved to be particularly resilient, with positive revenue growth (+4.6%), thanks to

the expansion in the UK. The Construction division saw a persistence of the trends of previous years:

deteriorating domestic activity offset by growth internationally, especially in the USA.

Services division won significant long-term contracts (Sheffield), as did Motorways, where a consortium in

which Cintra has a stake was awarded the East Extension of the 407ETR motorway, while the highlight

for the Construction division was winning the contract for the US460 motorway in Virginia (USA).

FINANCINGS In 2012, the 407ETR issued two long-term bonds for CAD600mn, which enabled the company to

refinance its 2014 maturities ahead of time. In April, it issued a CAD400mn bond with a 4.19% coupon

maturing in 2042. In September, it issued a CAD200mn bond with a 3.98% coupon maturing in 2052. In

2012, HAH issued bonds for a total of more than GBP3,000mn as part of its long-term capital markets

financing strategy, including an inaugural Swiss franc issue and another in Canadian dollars, together with

various private placements. After the year-end, Ferrovial successfully placed a five-year EUR500mn issue

with an annual coupon of 3.375%, its first issue of corporate bonds, for which requests were received for

more than EUR5,590mn. The proceeds have been applied to the early repayment of corporate debt.

Dec-12 Dec-11 Chg. (%) LfL (%)

Dec-12 Dec-11 Chg. (%)

Revenues 7,686.4 7,445.8 3.2 0.9

Construction Backlog 8,699 9,997 -13.0

EBITDA 926.8 817.2 13.4 11.2

Services Backlog 12,784 12,425 2.9

EBIT* 708.0 625.2 13.2 10.6

Net result 709.7 1,242.5 -42.9 n.s.

Traffic Dec-12 Dec-11 Chg. (%)

Capex 579.8 936.0 -38.1

ETR 407 (VKT´ 000) 2,340,004 2,325,517 0.6

Chicago Skyway (ADT) 42,228 42,066 0.4

Indiana Toll Road (ADT) 27,459 27,142 1.2

Autema (ADT) 15,056 19,114 -21.2

Dec-12 Dec-11 Chg. (mn)

Ausol I (ADT) 12,537 14,254 -12.0

Net financial Debt -5,105.5 -5,170.9 65

Ausol II (ADT) 14,099 15,576 -9.5 Net Debt Ex-Infrastructure

Projects 1,489.2 906.6 583

Heathrow (million pax.) 70.0 69.4 0.9

Results January-December 2012

2

MOTORWAYS

Dec-12 Dec-11 Chg (%) Like for

Like (%)

Revenues 381.4 389.7 -2.1 -3.1

EBITDA 271.6 283.2 -4.1 -5.1

EBITDA Margin 71.2% 72.7%

EBIT 204.4 230.5 -11.3 -12.2

EBIT Margin 53.6% 59.1%

Performance in 2012 at the revenue and EBITDA levels was mainly

affected by the administration’s failure to pay the compensation accounts

of the R4 and Ocaña-La Roda motorways in Spain (EUR23mn in 2011),

the reversal of VAT-related provisions (EUR20mn) at Autema and falling

traffic, partially affected by tariff increases. The Azores motorway started

operations in December 2011, with the consequent positive impact on the

consolidation perimeter in 2012, which was also increased by the SH-130

in Texas opening to traffic on 11 November 2012.

TRAFFIC PERFORMANCE

In Spain, traffic in all the corridors continued to decline, with an

appreciable drop in the fourth quarter. This weakness was due to the

deterioration in the economy and the rise in the price of fuel.

The decline in traffic in the corridors was exacerbated by a continuous

loss of traffic density share on the part of the toll motorways, for two

fundamental reasons. First, the cumulative decline in vehicle use since

the beginning of the economic crisis has considerably reduced congestion

on non-toll roads. Second, the reluctance to pay tolls in recessionary

times has become even more evident in recent quarters due to the

economic uncertainty in Spain, the loss of purchasing power due to the

austerity measures introduced by the government, and rising

unemployment.

In addition to all the above, VAT increased from 18% to 21% on 1

September, which was reflected in a 2.5% increase in the tolls paid by

motorists.

Other particular circumstances which had an impact on toll motorway

traffic in Spain were as follows:

At Ausol, the toll increase (+7.5%) that came into effect on 29 July,

driven by the cancellation of a compensation account approved in 1999 to

offset the tariff cuts at the time, and the opening to traffic of the San

Pedro de Alcántara tunnel on 26 June, both had a negative impact on

motorway traffic.

At Autema, the new tariff regime that came into effect in January

eliminated the subsidy to local users of the Sant Cugat-Terrassa section

and introduced new frequent-user discounts on that section for ‘green’

vehicles and multi-occupancy vehicles on the whole motorway. This

motorway has a compensation mechanism that guarantees its operating

result, established in 1999.

The other European motorways were also affected by the sharp increase

in fuel prices (which were at all-time highs in Portugal and Ireland).

In Portugal, modifications to the Norte Litoral concession contract

eliminate the traffic risk, and the Algarve motorway contract is in the

process of modification along the same lines.

Ireland: There was a slight fall-off in traffic on the M4 and M3 due to the

deterioration in the economic situation and the increase in fuel prices. On

a positive note, there was an improvement in heavy traffic, thanks to a

continuous increase in traffic density share in the corridors.

Traffic (IMD) Revenues EBITDA EBITDA Margin

Full consolidation Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg.

(pbs)

Chicago Skyway 42,228 42,066 0.4% 55.0 49.0 12.3% 47.6 41.7 14.0% 86.5% 85.2% 132

SH-130 6,201 1.8 n.s. 1.0 0.4 n.s. 53.7%

Ausol I 12,537 14,254 -12.0%

Ausol II 14,099 15,576 -9.5%

Ausol

48.5 53.4 -9.2% 36.6 40.4 -9.4% 75.5% 75.6% -13

Autema* 15,056 19,114 -21.2% 84.0 81.7 2.8% 92.2 68.4 34.7% 109.7% 83.7% 2,597

Radial 4 5,588 6,796 -17.8% 14.7 30.9 -52.3% 4.2 21.8 -80.9% 28.2% 70.6% -4,235

Ocaña-La Roda 3,191 3,822 -16.5% 13.5 24.2 -44.0% 5.7 16.9 -66.1% 42.3% 69.9% -2,761

M4 25,306 25,759 -1.8% 21.3 21.4 -0.7% 14.5 14.6 -0.5% 68.1% 67.9% 15

M3* 25,528 25,935 -1.6% 20.4 35.7 -42.8% 15.1 29.7 -49.2% 73.9% 83.2% -934

Euroscut Algarve

39.2 34.9 12.3% 34.4 29.8 15.7% 87.9% 85.3% 256

Euroscut Norte Litoral*

40.3 44.1 -8.7% 34.0 39.4 -13.7% 84.4% 89.2% -488

Azores 8,186 8,174 n.s. 21.1 0.9 n.s. 17.1 0.7 n.s. 81.1% 71.2% n.s.

Holding & Others 21.6 13.5 n.s. -30.7 -20.5 n.s.

Total

381.4 389.7 -2.1% 271.6 283.2 -4.1% 71.2% 72.7% -145

Equity consolidated Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg.

(pbs)

407 ETR (VKT) 2,340,004 2,325,517 0.6% 569.2 489.6 16.3% 471.6 401.7 17.4% 82.9% 82.0% 82

Indiana Toll Road 27,459 27,142 1.2% 151.9 133.3 13.9% 123.0 109.1 12.8% 81.0% 81.8% -79

Ionian Roads 29,223 34,442 -15.2% 57.9 66.2 -12.6% 15.9 37.6 -57.5% 27.6% 56.8% n.s.

* Financial assets


3

North America:

Q1 Q2 Q3 Q4

Chicago Skyway 2011 -6.5% -5.5% -7.6% -6.2%

2012 -0.7% +1.1% +0.4% +0.7%

Indiana Toll Road 2011 -1.6% -3.8% -4.1% -1.0%

2012 1.9% 2.6% -0.5% 1.3%

Traffic on the US toll motorways continued to improve, supported by the

modest growth in economic activity and lower fuel prices.

Indiana Toll Road: this motorway keeps the positive pattern of growth,

after the completion of the improvement and widening works and the

increase in the speed limit from 55mph to 70mph on one section. The

completion of these roadworks produced a particularly significant increase

in heavy vehicle traffic.

Chicago Skyway: the 0.7% growth in the fourth quarter was the third

consecutive quarter of growth after a prolonged period in decline, which

started in 2009. The growth in heavy traffic was particularly notable, and

as a reflection of the completion of improvement works on the contiguous

Indiana Toll Road.

The SH-130 opened to traffic on 24 October, and tolls were first levied on

11 November. The first few weeks in operation were affected by various

one-off events that had an extraordinary impact on traffic, such as the

Formula 1 Gran Prix, which increased traffic by 40% over the weekend of

the race, or the inclusion of the motorway in Google Maps’ route network,

which led to a 14% increase in traffic compared with the previous weeks.

Motorway traffic density was highest on the days before a public holiday,

such that the celebration of Thanksgiving on a Wednesday resulted in the

highest density to date.

OTHER IMPORTANT MATTERS

RADIAL 4

On 14 September, the Board of Directors of the Radial 4 toll motorway

approved a request to the courts for creditor protection, and this was

granted on 4 October.

The Radial 4 project was directly affected by exogenous factors

(substantially lower than expected traffic, higher than expected

expropriation costs, economic recession, etc.) which under the present

conditions have prevented the concession from being able to meet

various payments for expropriation and commitments to financial

institutions. An important factor when taking this decision was that the

potential supports for the concession envisaged in the legislation were not

effectively implemented by the contracting body. In the light of all the

above, the Board took the above-mentioned decision – which was also

legally binding - in the confidence that a solution would be reached within

the next few months.

The investment relating to this project is fully provisioned. As of the

outcome of the creditor protection process, there is not expected to be

any negative impact whatsoever on Ferrovial’s accounts.

The net debt associated with this asset amounts to EUR580mn.

As a result of filing for creditor protection, the stand-still agreements with

the lending banks were terminated.

OCAÑA - LA RODA

The Ocaña-La Roda toll motorway filed for creditor protection on 19

October 2012. On 4 December the courts accepted the request.

Ferrovial’s investment in this project is provisioned in full. As of the

outcome of the creditor protection process, there is not expected to be

any negative impact whatsoever on Ferrovial’s accounts.

The net debt associated with this asset amounts to EUR529mn.

The creditor protection filing triggered the early expiration of the

financing contract, which matured on 31 December 2012.

INDIANA TOLL ROAD TARIFF INCREASES

The new tariffs came into effect on 1 July. These implied 7.7% and 2.7%

increases in the tolls for light vehicles not using a transponder on a

standard journey the full length of the motorway on the open and closed

sections respectively. The increases for heavy vehicles were 1.5% for the

open section and 3.9% for the closed section.

DIFFERENTIATION BETWEEN FINANCIAL AND

INTANGIBLE ASSETS

In the application of IFRIC 12, concession contracts can be classified as

either intangible or financial assets. Contracts treated as financial assets

are those than include some revenue guarantee mechanism, and where

there is thus no traffic risk. In the case of Cintra, the concessions treated

as financial assets are the following: Autema, Norte Litoral and the M-3.

In the case of the North Litoral, the classification as a financial asset is

due to changes in the terms of the contract from shadow tolls to

availability payments.

CONTRACT AWARDS

Canada: 407 East Extension (availability payment) (Cintra 50%). Total

investment in the project of CAD1,100mn.

Spain: Almanzora freeway (between Purchena and Huercal-Overa) (Cintra

16.25%). The concession contract was signed on 15 March. Availability

payment, 30-year concession with a total investment in the project of

approximately EUR145mn.

A-66 (Benavente – Zamora) (Cintra 20%). The concession contract was

signed on 14 December. Availability payment, 30-year concession with a

total investment in the project of approximately EUR192mn for the

construction.

Cintra acted as financial advisor to the US460 project, which was awarded

to a consortium led by Ferrovial Agromán (Ferrovial 70%) on 9 October

2012. The commercial and financing close was on 20 December 2012.

TENDERS

In spite of the uncertainty in the markets, there has been a slight

recovery in the development activities of public authorities in some of

Ferrovial’s international target markets.

In North America, Ferrovial is evaluating various different projects in

various States, and in Europe, the company is working on various

projects.

The company is also studying projects in other markets such as Australia

and Latin America.


4

407-ETR

CAD Dec-12 Dec-11 Chg (%)

Revenues 734.0 675.0 8.7

EBITDA 608.2 553.8 9.8


EBIT 547.6 495.4 10.5


Financial results -300.1 -318.8 5.9

EBT 247.5 176.6 40.2

Corporate income tax -70.3 -43.7 -60.6

Net Income 177.2 132.9 33.4

Net Income attributable to Ferrovial

76.6 57.4 33.4

Contribution to Ferrovial equity

accounted result (€) 46.0 30.5 51.0

N.B: since Ferrovial’s disposal of 10% in 2010, the motorway has been consolidated by the equity method, as a reflection of the percentage controlled by Ferrovial (43%).

The 407ETR saw significant revenue and EBITDA growth of 8.7% and

9.8% respectively in local currency terms. This positive performance

reflects the combination of tariff increases on 1 February and traffic

performance. The average revenue per journey increased by 8.5% vs.

2011.

407ETR contributed EUR46mn to Ferrovial’s equity-accounted results,

after the annual amortization of the goodwill generated by the sale of

10% in 2010, which is being depreciated over the life of the asset in line

with the traffic expectations.

DIVIDENDS

CAD 2012 2011 Chg.%

Q1 87.5 82.5 +6.6

Q2 87.5 82.5 +6.6

Q3 87.5 82.5 +6.6

Q4 189.9

Q4 147.3

Total Q4 337.1 102.3 +229.6

Total 599.9 348.8 +72.0%

Extraordinary 110.0

Total 599.9 458.8 +30.7%

Including the distributions made in the fourth quarter, dividends reached

CAD600mn in 2012. The detail of the annual distributions in 2008-2012 is

shown in the following table:

TRAFFIC

Traffic performance, measured in kilometres travelled (VKT, +0.6%)

showed an improvement over the same period in 2011 (-0.5%), thanks

both to the number of journeys (+0.1%) and the average length of the

journey (+0.5%). From mid-2011 there has been an appreciable

stabilisation in light vehicle traffic and an increase in heavy vehicle traffic,

reflecting the correlation with the economic recovery in the Province of

Ontario.

NET DEBT

407ETR closed the financial year with a net debt position of CAD5,219mn.

The company has no significant debt maturities until 2015 (CAD500mn).

DEBT ISSUANCE

407ETR’s latest bond issue (CAD200mn with a 3.98% coupon, maturing

in 2052) was on 6 September. In April 2012 it issued CAD400mn, with a

4.19% coupon and maturing in April 2042, thus refinancing its 2014

maturity ahead of time.

CREDIT RATINGS

S&P: "A" (Senior debt), "A-" (Junior debt) and "BBB" (Subordinated debt).

DBRS: "A" (Senior debt), "A low" (Junior debt) and "BBB" (Subordinated

debt).

407ETR TARIFFS

The following table shows the comparison between the 2011 and 2012

tariffs (which came into effect on 1 February).

CAD 2012 2011

Regular Zone Peak Period Monday-Friday: 6am-7am, 9am-10am, 3pm-4pm, 6pm-7pm

Peak Hours Monday-Friday: 7am-9am (2010: 7.30am-8.30am), 4pm-6pm

24.20¢ /km

25.20¢ /km

22.75¢ /km

22.95¢ /km

Light Zone Peak Period Monday-Friday: 6am-7am, 9am-10am, 3pm-4pm, 6pm-7pm Peak Hours Monday-Friday: 7am-9am, 4pm-6pm

22.60¢ /km

23.55¢ /km

21.25¢ /km

21.45¢ /km

Midday Rate Weekdays 10am-3pm 21.00¢/km 19.35¢/km

Off Peak Rate Weekdays 7pm-6am, Weekends & public holidays

19.35¢/km 19.35¢/km

Transponder: Monthly rental $3.00 $2.75

Transponder: Annual rental $21.50 $21.50

Video toll per journey $3.80 $3.65

Cargo per journey (This is not a charge per km.)

$0.60 $0.50

LANE OPENINGS

On 29 August the new lanes for segments C5 and C6 were opened to

traffic (one 16km lane in each direction), with these segments of the

motorway the first to achieve their final configuration.

CAD Total Chg.%

2008 135 +12.5

2009 190 +40.7

2010 300 +57.9

2011 459 +52.9

2012 600 +30.7


5

SERVICES

Dec-12 Dec-11 Chg.(%) LfL (%)

Revenues 2,951.1 2,820.6 4.6 1.3

EBITDA 313.6 311.8 0.6 -2.0


EBIT 203.3 207.4 -2.0 -5.2


Backlog 12,783.9 12,424.7 2.9 1.5

In comparable terms, the Services account posted a slight increase in

revenues (+1.3%), with a mildly negative performance at the EBITDA

level (-2.0%).

The revenue growth was driven by the growth in the UK (+8.3%), which

offset the weakness of activity in Spain (-5.0%), where there was a

persistence of the trend seen in earlier quarters as a consequence of the

challenging economic conditions. The decline at the EBITDA and EBIT

levels is a consequence of non-recurrent positive impacts at Amey in the

previous financial year and the reduced activity in Spain.

BUSINESSES IN SPAIN

Dec-12 Dec-11 Chg. (%)

Revenues 1,460.6 1,536.9 -5.0

EBITDA 195.3 198.4 -1.6

EBITDA Margin 13.4% 12.9% EBIT 102.4 110.7 -7.6

EBIT Margin 7.0% 7.2% Backlog 5,576.9 6,172.1 -9.6

Figures for Spain include central service costs and the start of operations

in other countries (Poland). Excluding these impacts, Spanish business

EBITDA and EBIT would be reduced by 1% and 6.6% vs. -1.6% and -

7.6% reported, showing the strength of the business in a very

challenging economic situation.

In line with the rest of the year, revenues and EBITDA were 5% and

1.6% respectively lower than in 2011. The deterioration at the EBIT level

was more pronounced (-7.6%), as 2012 was the first full year for certain

contracts with high depreciation levels. This was the case for the new

waste collection and treatment contract in Murcia, and the highway

maintenance contract for the A2 freeway.

Nevertheless, in spite of this reduced activity, sales margins were in line

with 2011 as a reflection of control over costs, which in recent years have

been adapted to the decline in activity, and active management of

portfolio quality.

In the Waste Collection and Treatment business, the contraction in

economic activity in Spain resulted in a fall in the tonnage of waste

managed (-10% vs. 2011). In the urban waste collection and highway

cleaning contracts, revenues fell due to various local authorities reducing

service levels due to budget restrictions; other contracts were terminated

or not renewed due to their low margins or as a result of payment

difficulties.

In the Infrastructure Maintenance business, revenues fell due to a

reduction in services required by clients, notably highway maintenance

contracts for the Ministry of Development. In addition, the company was

more selective in taking on contracts, with the aim of controlling working

capital investment and protecting its profit margins.

Payments received thanks to RD 4/2012 and RD 7/2012 relating to public

administration supplier payments amounted to EUR499mn.

AMEY

Dec-12 Dec-11 Chg.(%) LfL (%)

Revenues 1,490.6 1,283.7 16.1 8.3

EBITDA 118.3 113.3 4.4 -2.6


EBIT 100.9 96.7 4.4 -2.6


Backlog 7,207.0 6,252.6 15.3 12.1

Revenues increased 8.3% in comparable terms as a reflection of the start

of various contracts, notably the prisoner transport and custody contract

awarded in 2011 and the infrastructure maintenance contract for the City

of Sheffield. The rest of the growth was driven by higher turnover on

existing contracts such as highway maintenance in Area 9 and the London

area due to the Olympic Games, work which was completed in the first

half of the year.

In spite of the revenue growth, EBITDA (-2.6%) and EBIT (-2.6%) were

lower than in the previous year, as a consequence of non-recurrent

profits booked in 2011 on the sale of machinery (EUR7mn) and costs

related to new contract start-up in 2012.

BACKLOG

The backlog reached EUR12,784mn (+2.9% vs. December 2011), driven

by the increase in Amey’s backlog.

In the UK, the 25-year EUR1,414mn urban infrastructure maintenance

contract for Sheffield was added to the backlog once the financing had

been closed in August 2012.

In Spain, the highlights in the waste collection and treatment business

were the award of an 18-year contract for two treatment plants in the

Canary Islands, the renewal of the urban waste collection and highway

cleaning contract for San Vicente de Raspeig (for eight years) and the

renewal for one year of the contract for the cleaning and maintenance of

green zones in Madrid (10 districts). In the infrastructure maintenance

and facility management business, other than the energy management

contract for Torrejón, for 20 years, the highlights were the maintenance

contract for various sections of the State roadway network (three years),

the new contract for call centre services for the Madrid Town Hall (four

years) and an energy services maintenance contract for outdoor lighting

for the municipality of Soto del Real in Madrid.


6

CONSTRUCTION

Dec-12 Dec-11 Chg. % Like-for-Like

(%)

Revenues 4,325.6 4,243.8 1.9 0.1

EBITDA 336.9 246.4 36.8 33.0


EBIT 298.4 213.9 39.5 35.4


Backlog 8,699.4 9,997.2 -13.0 -14.2

Activity was stable in 2012 in comparable terms (+0.1%), maintaining the

same dynamic as in the past few years, with a significant decline in the

activity in Spain offset by strong growth in international activities.

EBITDA growth reached EUR337mn, principally due to the settlement and

reversal of EUR135mn of net provisions on completion of works.

BACKLOG

Dec-12 Dec-11 Chg. %

Civil work 6,837.4 7,602.4 -10.1

Residential work 284.2 363.7 -21.9

Non-residential work 867.2 1,334.8 -35.0

Industrial 710.6 696.3 2.1

Total 8,699.4 9,997.2 -13.0

The 13% contraction in the backlog vs. December 2011 was due to a

high level of executions, a lower level of new contract awards, the

exclusion from the consolidation perimeter of PNI’s backlog (EUR275mn)

after it was deconsolidated in November and contract cancellations

(notably EUR272mn on the cancellation of part of the work for the Central

Greece).

The ability to carry out complex projects such as the LBJ and NTE toll

motorways in Texas is positioning Ferrovial as a market reference in the

USA.

During the 2012 financial year, entries into the backlog included

important international civil works projects, such as the construction of

the 407ETR East Extension and the US460 toll motorways in Canada and

the State of Virginia (USA) respectively.

The weight of the international backlog continues to increase, and it now

represents 70% of the total at EUR6,060mn vs. the domestic backlog’s

EUR2,640mn.

The domestic backlog contracted by 17%, mainly as a reflection of the

drop in public-sector contracts put out to tender in Spain (-45%).

MARKETS

The internal management structure of the Construction division changed

in the third quarter, to adapt to the new market reality. Budimex and

Webber continue to report directly, whereas Spain is now included as just

another area of activity and is no longer reported separately.

BUDIMEX


(%)

Revenues 1,420.3 1,323.5 7.3 8.1

EBITDA 57.2 71.0 -19.4 -18.8


EBIT 45.1 63.6 -29.1 -28.5


Backlog 1,193.9 1,919.7 -37.8 -43.1

Budimex posted significant revenue growth as a consequence of the

execution of large projects and an improvement in the weather. The

lower margins reflected the losses generated on PNI’s contracts.

Consolidation of PNI ceased in November, after the company filed for

creditor protection on 24 August 2012. Excluding PNI revenues would

have grown by 4%, EBITDA by 8%.

The backlog reached EUR1,194mn, 43.1% below the 2011 level (-27%

excluding PNI in both years), reflecting announced cutbacks of public

investment in roads, the completion of some large projects.

WEBBER


(%)

Revenues 591.5 424.9 39.2 28.4

EBITDA 23.0 17.1 34.5 22.8


EBIT 17.7 11.4 55.1 40.9


Backlog 1,288.3 1,650.6 -21.9 -20.5

Webber posted strong revenue growth in local currency terms (+28%)

thanks to the start of projects awarded the previous year and the higher

level of execution on the managed lanes. In euro terms, revenue growth

reached 39% due to euro weakness against the US dollar.

The contraction in the backlog (-20.5%) was a consequence of a high

level of execution after a significant volume of contract awards in 2011.

OTHER MARKETS


(%)

Revenues 2,313.9 2,495.3 -7.3 -9.1

EBITDA 256.7 158.3 62.2 56.3


EBIT 235.6 138.9 69.7 62.8


Backlog 6,217.2 6,426.9 -3.3 -3.2

The revenue weakness was principally due to the performance of the

Spanish market (-24%). Works related to the new toll motorways in

Texas continued to post positive results. Margin improvement was mainly

thanks to reversal of provisions on completion of projects that were not

offset by the start of new projects.

The amounts collected relating to RD 4/2012 for the payment of suppliers

to the public administrations amounted to EUR190mn.


7

AIRPORTS On 15 October, the company announced that the commercial brand name

BAA was no longer in use, and had been replaced by HAH. There were

various reasons for this change, amongst which the fact that with the sale

of Stansted, Heathrow now represents 95% of the former group.

In the 2012 financial year, Ferrovial completed two disposals in HAH. On

17 August Ferrovial announced the sale of 10.62% of the group to Qatar

Holding for GBP478mn and on 31 October the sale of 5.72% to CIC

International for GBP257.4mn. Both these deals were closed in 2012.

The contribution of the Airports division to Ferrovial’s equity-accounted

results reached EUR231mn, principally due to the following non-recurrent

items: a EUR98mn capital gain on the sale of Edinburgh airport, the

positive impact of the two percentage point cut in corporation tax in the

UK (EUR90mn) and EUR65mn for marking the derivatives portfolio to

market. The capital gain on the sale of 16.34% of HAH amounted to

EUR186mn (of which EUR115mn in the impairment and sale of fixed

assets line and EUR71mn as a tax credit).

TRAFFIC PERFORMANCE

Traffic at Heathrow (+0.9%) reached an all-time high in 2012 with 70.0

million passengers. Characterised by higher load-factors (75.6% vs.

75.2% in 2011), a record in the history of the airport.

Underlying traffic growth was positive in 2012, although it fluctuated

during the year: the first quarter performance was very satisfactory,

helped by the extra day (2012 was a leap year), the Easter holidays

falling earlier than in 2011 and the Royal Wedding, which took place in

2011. In the third quarter (July and August), Heathrow traffic was

affected by the Olympic Games in London: passenger numbers fell by

more than 400,00 because UK passengers stayed in Britain to take part

and non-British travellers avoided the UK in case of mishap. Since then

traffic growth has been continuous, with record months in September,

November and December 4Q12 +1.6%).

By markets, traffic growth at Heathrow was driven by the favourable

performance of the North Atlantic routes (+3.2%), while traffic to other

long-haul destinations declined marginally. There was a notable

improvement in routes to Brazil, the Middle East (a partial recovery in

spite of the instability in the region) and the Far East (a recovery in traffic

after the Tsunami in Japan in 2011), offset by the weakness of traffic on

African and Indian routes. European traffic improved modestly, depending

on the market (+0.6%), as a reflection of the macroeconomic situation in

each country.

Stansted traffic fell 3.2%, although there was a return to growth after the

summer after a number of years in decline. In the first nine months of

the year traffic fell 4.6%, but grew 1.8% in the fourth quarter. This

growth was based on capacity increases in Ryanair’s winter schedule.

Traffic growth by destination was as follows:

2012 2011 LfL (%)

UK 16.8 16.9 -0.7%

Europe 45.1 44.7 0.9%

Long Haul 37.8 37.6 0.5%

Total 99.7 99.2 0.5%

TARIFFS

The increase in the maximum aeronautical tariffs applicable in the 2012-

2013 regulatory year came into effect on 1 April 2012.

The following table compares the tariff increases of 2011 with those of

2012:

2012 2011 Regulation

Heathrow +12.7% +12.2% RPI+7.5%

Stansted +6.8% +6.3% RPI+1.63%

The tariffs that will come into force on 1 April 2013 will be calculated

based on the rate of inflation in August 2012, which was 2.9%. Tariffs at

Heathrow will increase by 10.4%.

GBP Traffic Revenues EBITDA EBITDA Margin

Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. Dec-12 Dec-11 Chg. (bps)

Heathrow 70.0 69.4 0.9% 2,108 1,936 8.9% 1,103 983 12.2% 52.3% 50.8% 155

Heathrow express

181 174 4.2% 67 62 6.8% 36.8% 35.9% 89

Heathrow total 70.0 69.4 0.9% 2,289 2,110 8.5% 1,169 1,045 11.9% 51.1% 49.5% 154

Stansted 17.5 18.0 -3.2% 242 234 3.0% 94 87 8.3% 39.0% 37.1% 190

Regulated airports 87.4 87.4 0.0% 2,531 2,344 8.0% 1,263 1,132 11.6% 49.9% 48.3% 163

Edinburgh*

42 41 3.9% 17 16 2.4% 39.2% 39.7% -56

Glasgow 7.2 6.9 4.2% 87 82 5.9% 32 30 5.2% 36.5% 36.8% -26

Aberdeen 3.4 3.1 8.3% 57 53 8.2% 21 18 12.1% 36.1% 34.8% 124

Scottish airports 10.5 10.0 5.5% 187 176 6.1% 69 65 6.4% 37.0% 36.9% 10

Southampton 1.7 1.8 -3.9% 27 27 -1.9% 8 10 -13.8% 31.5% 35.9% -436

Holding & adl.

-98 -93 14 20

Total (LfL) 99.7 99.2 0.5% 2,646 2,455 7.8% 1,355 1,227 10.5% 51.2% 50.0% 125

Perimeter changes

69

60

Total 99.7 99.2 0.5% 2,646 2,524 4.8% 1,355 1,287 5.3% 51.2% 51.0% 22

*Until May


8

INCOME STATEMENT

GBP Dec-12 Dec-11 Chg. % LfL (%)

Revenues 2,645.9 2,524.0 4.8 7.8

EBITDA 1,355.2 1,287.2 5.3 10.5

EBITDA margin % 51.2% 51.0%

Depreciation 582.8 652.9 -10.7

EBIT 772.4 634.3 21.8 21.2

EBIT margin % 29.2% 25.1%

Impairments & disposals 151.2 9.4

Financial results -669.8 -932.6 28.2 11.0

EBT 253.8 -288.9 187.9 89.5

Corporate income tax 120.9 267.6 -54.8 -95.7

Net income (100%) 374.7 -21.3 n.s. 85.7

Net income €(49,99%%)

230.7 -12.6 n.s. 80.8

Revenue and EBITDA growth of 7.8% and 10.5% respectively, supported

by the revenue breakdown shown in the table below and cost-

containment (costs only increased by 5.1% in comparable terms). The

significant growth at the EBIT level was due to the drop in depreciation

after the accelerated depreciation of T1 and T5C booked in 2011.

GBP Dec-12 Dec-11 Chg. % LfL (%)

Aeronautic 1,529.5 1,424.5 7.4 10.2

Retail 604.3 601.6 0.4 4.5

Others 512.1 497.9 2.8 4.7

TOTAL 2,645.9 2,524.0 4.8 7.8

Aeronautical Retail Other

GBP Dec-12 LfL

(%) Dec-12

LfL (%)

Dec-12 LfL

(%)

Heathrow 1,279.7 11.3 460.1 5.7 549.2 4.7

Stansted 133.4 5.2 81.6 -1.9 26.6 8.6

Glasgow 44.0 4.6 28.1 9.8 14.6 2.7

Edinburgh 23.0 4.7 13.7 1.8 5.8 5.4

Aberdeen 32.8 5.9 11.5 13.4 13.1 9.8

Southampton 16.6 0.7 8.0 -8.6 2.4 5.0

Other & adjustments

1.4 -17.3 -99.6 5.7

Total airports 1,529.5 10.2 604.3 4.5 512.1 4.7

Aeronautical revenues (+10.2%) reflected the strong performance at

Heathrow (+11.3%): traffic +0.9%, tariffs +12.7% since April 2012, but

diluted in real terms due to the difference in the actual traffic mix from

that used in the tariff calculations (more passengers in transit and lower

revenues from apron parking) amounting to around GBP40.2mn, this

shortfall (or yield dilution) will be recovered through the ‘K factor’ true-up

mechanism in the years commencing 1 April 2013 and 1 April 2014. At

Stansted (+5.2%) the negative traffic growth (-3.2%) was mitigated by

the tariff increases introduced in April 2012 (+6.8%) and the reductions

in airline discounts.

Retail revenues (+4.5%). The positive trend in retail revenues continued

in the same path as seen in previous years.

At Heathrow, retail revenues increased by 5.7%, and net retail revenues

per passenger rose 4.4% to GBP6.21. The substantial increase was a

reflection of a combination of traffic growth and a good performance from

the luxury goods outlets, duty-free, catering, foreign exchange and

parking.

Sales growth at the duty-free and air-side tax-free shops was very

positive thanks to the increase in non-European travellers and to the

opening of new commercial space in Terminal 3 and World Duty Free in

terminals 3 and 4. Sales growth in the luxury goods and fashion outlets

was particularly positive. Revenue growth in the bureaux de change was

principally due to improvements in the terms of their commercial

contracts. The growth in the restaurant sector over and above the

increase in the number of passengers was a reflection of the improved

offering, with new premium outlets, the new trading agreements and the

general effort to improve the quality and speed of service. Finally,

advertising revenues increased thanks to the positive impact of the

Olympic Games.

At Stansted, retail revenues fell 1.9% over the year, although the net

retail revenues per passenger increased by 2.8%.

Other revenues increased by 4.7%, driven by the rise in rail revenues

(+4.4%) thanks to price increases.

REGULATORY MATTERS

TARIFFS FOR THE NEXT FIVE-YEAR PERIOD (Q6)

Since presenting its initial business plan for the next regulatory period

(Q6) on 30 July, Heathrow has continued working with both the CAA and

the other interested parties to define the future development of the

airport in the next regulatory period, which starts in April 2014.

The constructive engagement between the parties included discussions of

the different variables that influence how the tariffs are determined

(capex, traffic forecasts, opex and retail revenues). This process

concluded with Heathrow’s publication of its complete business plan for

the next five-year period. The proposed annual tariff increase based on

this business plan, assuming no initial adjustment in the tariff, is RPI

+5.9%.

Heathrow’s business plan assumes modest increase passenger traffic over

the next regulatory period that, after an allowance for shocks averages

around the airport’s current un-shocked traffic performance, Heathrow

believes it is essential to properly reflect the likely impact on passenger

traffic over any medium or long-term horizon from potential shocks given

that historically they have impacted its traffic by an average of close to

1.5%.

The business plan also includes the proposed investment for the period,

amounting to approximately GBP3,000mn (at 2011/2012 prices).

After the publication of this business plan, it is now up to the CAA to

make its own analysis, after which it will make an initial proposal for the

tariff in April 2013. The CAA’s final tariff proposal is expected in October

2013.

REGULATORY ASSET BASE (RAB)

GBP Heathrow Stansted Total

December 2011 12,490.2 1,359.5 13,849.7

December 2012 13,471.0 1,342.7 14,183.7

The increase in RAB in 2012 reflects the investments made

(GBP1,180mn), the increase in inflation (GBP435mn) which was partially

offset by depreciation during the period (GBP605mn) and the profiling

(GBP45mn).


9

NET DEBT

GBP Dec-12 Dec-11 Chg. %

Senior loan facility 587.7 684.4 -14.1%

Subordinated 717.0 538.1 33.3%

Securitized Group 11,315.2 10,663.4 6.1%

Non-Securitized Group 337.2 1,035.6 -67.4%

Other & adjustments -26.2 -59.5 -55.9%

Total 12,931.0 12,862.0 0.5%

In 2012 the financial structure of the debt was transformed. This intense

activity in the capital markets (bond issuance of more than GBP3,000mn)

allowed the company to extend its debt maturity calendar, expand the

number of markets and currencies and significantly reduce its banking

exposure.

BOND ISSUES AND REFINANCINGS

Since the beginning of 2012 the company has made 11 debt placements,

which have enabled it to capture more that GBP3,000mn in various

different currencies, rating levels and formats. The particular highlights

were the bond issues in the USA (USD500mn) and the inaugural issuance

in Canada (CAD400mn), which formed part of the company’s

geographical diversification and already included issuance in sterling,

euros and French francs.

Amount Maturity Coupon

Class A

CAD400mn 7 years 4.000%

GBP300mn 3 years 3.000%

USD500mn 3 years 2.500%

CHF400mn 5 years 2.500%

EUR700mn 5 years 4.375%

GBP95mn (ILS) 27 years 3.334%

GBP180mn* 10 years 1.650%

EUR50mn* 20 years 4.250% (yield)

EUR50mn* 20 years 4.125% (yield)

Class B



High Yield


(*) Private placement

In June 2012, HAH refinanced its credit and liquidity lines. The new loan

met high demand which reached GBP400mn from 17 banks, both English

and international. The strength of the demand allowed the maximum

amount of the loan to be raised to GBP2,750mn, included a revolving

credit for GBP2,000 (GBP1,500mn Class A, GBP400mn Class B for

investment and GBP100mn for working capital) and GBP750mn of

liquidity lines.

The new loan has a maturity of five years (June 2017) and replaces a

similar loan maturing in August 2013. The margins on tranche Class A

and Class B are 150 and 225 basis points respectively.

HAH also cancelled a GBP1,000mn bond maturing in February 2012 and

repaid GBP475mn of the GBP625mn of the Class B loan and GBP125mn of

the subordinated bank debt of GBP175mn maturing in 2015.

In April 2012, the conditions of the Senior loan facility (the previous

Toggle debt) were modified, and changed from perpetual debt to a

seven-year term with a slight increase in the cost (7.00% vs. 6.89%), all

of which has enabled the company to gain flexibility for dividend

payments to its shareholders.

HAH’s financial structure is now principally capital markets-oriented, with

only marginal bank financing.

DIVIDENDS

In 2012, for the first time since its acquisition in 2006, HAH started to pay

quarterly dividends to its shareholders. In 2012 HAH distributed

GBP240mn to its shareholders, and in 2013 it expects to distribute slightly

more than this.

DISPOSALS

SALE OF STANSTED AIRPORT

The sale process started in August 2012 was concluded on 18 January

2013 with the announcement of the sale of Stansted airport to MAG

(Manchester Airport Group) for GBP1,500mn (EBITDA 2012 GBP94mn,

RAB 2012 GBP1,343mn). The deal is expected to be completed by end-

February. The proceeds are expected to be principally used to amortise

debt.

SALE OF EDINBURGH AIRPORT

On 23 April 2012, HAH announced the sale of Edinburgh airport to GIP for

GBP807.2mn, which implies a multiple of 16.7x the airport’s 2011

EBITDA. The sale proceeds have been used to cancel non-regulated

airports’ bank debt.


10

CONSOLIDATED INCOME STATEMENT

Before Fair

value Adjustments

Fair value Adjustments

Dec-12

Before Fair

value Adjustments

Fair value Adjustments

Dec-11

Revenues 7,686

7,686 7,446

7,446

Other income 17

17 15

15

Total income 7,703

7,703 7,461

7,461

COGS 6,776

6,776 6,643

6,643

EBITDA 927

927 817 817

EBITDA margin 12.1%

12.1% 11.0%

11.0%

Period depreciation 219

219 192

192

EBIT (ex disposals & impairments) 708

708 625 625

EBIT margin 9.2%

9.2% 8.4%

8.4%

Disposals & impairments 115 -63 52 229 -130 99

EBIT 823 -63 760 854 -130 724

EBIT margin 10.7%

9.9% 11.5%

9.7%

FINANCIAL RESULTS -338 48 -290 -360 57 -303

Financial result from financings of infrastructures projects -298

-298 -265

-265

Derivatives, other fair value adjustments & other financial result -6 2 -4 -11 -3 -13

Financial result from financings of other companies -26

-26 -82

-82

Derivatives, other fair value adjustments & other financial result -7 46 38 -2 60 58

Equity-accounted affiliates 222 62 284 18 1 20

EBT 707 47 754 512 -72 440

Corporate income tax -108 0 -108 -63 2 -61

Net Income from continued operations 599 47 646 449 -70 379

Net income from discontinued operations

165 679 844

CONSOLIDATED NET INCOME 599 47 646 614 609 1,223

Minorities 60 3 64 0 20 19

NET INCOME ATTRIBUTED 660 50 710 614 629 1,243

Airports division: on 26 October 2011 Ferrovial sold 5.88% of FGP Topco, the holding company of the HAH group. This resulted in HAH being consolidated by the equity

method from November 2011 onwards. Under NIIF 5, 2011 results from HAH are reported under the headline of “Net income from discontinued operations” for 10 months while 2 months are accounted under the “Equity-accounted affiliates”. 2012 HAH results are accounted under “Equity-accounted affiliates”.


11

REVENUES

Dec-12 Dec-11 Chg. % Like-for-Like (%)

Construction 4,325.6 4,243.8 1.9 0.1

Toll Roads 381.4 389.7 -2.1 -3.1

Services 2,951.1 2,820.6 4.6 1.3

Others 28.2 -8.3 n.s.

Total 7,686.4 7,445.8 3.2 0.9

EBITDA


Construction 336.9 246.4 36.8 33.0

Toll Roads 271.6 283.2 -4.1 -5.1

Services 313.6 311.8 0.6 -2.0

Others 4.6 -24.0 n.s.

Total 926.8 817.2 13.4 11.2

DEPRECIATION

The increase vs. the same period last year (+12.9% in comparable terms)

to EUR219mn was principally a reflection of the inclusion of new

concessions at Cintra within the consolidation perimeter and the start of

operations on contracts requiring significant investments at the Services

division.

EBIT (before impairments and disposal of fixed assets)


Construction 298.4 213.9 39.5 35.4

Toll Roads 204.4 230.5 -11.3 -12.2

Services 203.3 207.4 -2.0 -5.2

Others 1.9 -26.6 n.s.

Total 708.0 625.2 13.2 10.6

*For purposes of analysis, all the comments referring to EBIT are before

impairments and disposals of fixed assets.

Excluding the impact of the exchange rate and variations in the

consolidation perimeter, the increase would be 10.6%.

IMPAIRMENTS AND DISPOSAL OF FIXED ASSETS

This element includes impairments for 63 million euros, corresponding to

the Services division in the UK, to certain real estate lots and the

additional impairment for PNI (a Budimex subsidiary) to cover the part of

the initial investment that was not already provisioned.

The capital gain on the disposal of 16.34% of HAH reached 115 million

euros.

NET FINANCIAL EXPENSES


Infra projects -297.9 -265.4 -12.2

Other -26.3 -82.2 68.0

Net financial result (financing) -324.1 -347.7 6.8

Infra projects -3.7 -13.3 72.3

Other 38.2 57.6 -33.7

Derivatives, other fair value adjustments & other financial result

34.5 44.4 -22.2

Financial Result -289.6 -303.3 4.5

The financial result improved by 4.5% thanks to a combination of:

A 6.8% improvement in the financing result. Expenses on infrastructure

projects increased due to the higher level of debt, principally associated

with the projects under development. Financial expenses at the other

companies fell as a reflection of reductions in their borrowing levels and

lower costs in 2012 after the 2011 refinancing of corporate debt

(EUR791mn repaid and EUR1,314mn refinanced), and lower interest

rates.

The result of derivatives and other fair value adjustmenst (inflows), is a

reflection of the improvement in Ferrovial’s share price in 2011 and its

positive impact on the derivative contracts that cover the retribution plans

linked to the share performance.

EQUITY ACCOUNTED RESULTS


Construction -1.4 -0.1 n.s.

Services 12.0 1.9 n.s.

Toll Roads 42.4 27.5 54.0

Airports 230.7 -9.8 n.s.

Total 283.7 19.6 n.s.

The companies consolidated by the equity method made a contribution of

EUR284mn (vs. EUR20mn in 2011). The 2012 figure includes the

contributions from the 407ETR toll motorway (EUR45mn) and HAH

(EUR231mn).

NET RESULT

Net profit reached EUR710mn vs. EUR1,243mn in 2011. The difference

was principally due to the capital gains on the disposals of 5.88% of HAH

(EUR847mn), Swissport (EUR199mn) and the M45 toll motorway

(EUR27mn) in 2011.


12

BALANCE SHEET AND OTHER MAGNITUDES

Dec-12 Dec-11

FIXED AND OTHER NON-CURRENT ASSETS 16,638 17,500

Consolidation goodwill 1,487 1,482

Intangible assets 116 103

Investments in infrastructure projects 6,755 5,960

Property 35 64

Plant and Equipment 507 627

Equity-consolidated companies 4,304 5,199

Non-current financial assets 1,668 1,912

Receivables from Infrastructure assets 1,334 1,279

Financial assets classified as held for sale 1 0

Restricted Cash and other non-current assets 148 390

Other receivables 186 243

Deferred taxes 1,609 2,018

Derivative financial instruments at fair value 158 134

CURRENT ASSETS 5,580 5,452

Assets classified as held for sale 2 2

Inventories 394 427

Trade & other receivables 2,203 2,673

Trade receivable for sales and services 1,647 2,083

Other receivables 436 539

Taxes assets on current profits 120 50

Cash and other financial investments 2,972 2,349

Infrastructure project companies 237 188

Restricted Cash 25 24

Other cash and equivalents 212 164

Other companies 2,735 2,161


TOTAL ASSETS 22,217 22,951

EQUITY 5,762 6,246

Capital & reserves attributable to the Company´s equity holders 5,642 6,113

Minority interest 121 133

DEFERRED INCOME 356 292

NON-CURRENT LIABILITIES 11,117 10,806

Pension provisions 105 110

Other non current provisions 1,166 1,010

Financial borrowings 6,996 6,695

Financial borrowings on infrastructure projects 5,825 5,503

Financial borrowings other companies 1,171 1,192

Other borrowings 203 179

Deferred taxes 1,080 1,298

Derivative financial instruments at fair value 1,567 1,514

CURRENT LIABILITIES 4,982 5,606

Financial borrowings 1,229 1,214

Financial borrowings on infrastructure projects 1,168 1,145

Financial borrowings other companies 61 69


Trade and other payables 3,273 3,882

Trades and payables 2,648 3,223

Deferred tax liabilities 75 51

Other liabilities 549 608

Trade provisions 415 502

TOTAL LIABILITIES & EQUITY 22,217 22,951

The 2011 balance sheet has been restated in accordance with paragraph 49 of NIIF 3 to reflect the modification of the provisional accounting for the combination of PNI’s businesses within the period of one year prior to the acquisition, as established in the above-mentioned NIIF.


13

CONSOLIDATED NET DEBT

The net cash position excluding infrastructure projects improved

significantly vs. December 2011, reaching EUR1,489mn, principally thanks

to cash generation at the Services division, the dividends received from

the infrastructure projects and the disposals at HAH. Cash outflows for

dividend payments to shareholders amounted to EUR826mn.

Net project debt reached EUR6,595mn. The variation was principally due

to the investments in toll motorways in the USA.

This net debt includes EUR1,026mn of debt related to motorways under

construction (the NTE and the LBJ). It also includes EUR1,110mn of debt

related to the radial motorways (R4 and Ocaña-La Roda) that have filed

for creditor protection.

The group’s net debt stood at EUR5,106mn.

Dec-12 Dec-11

NCP ex-infrastructures projects 1,489.2 906.6

Toll roads -6,238.1 -5,691.9

Others -356.6 -385.6

NCP infrastructures projects -6,594.7 -6,077.5

Net Cash Position -5,105.5 -5,170.9

CORPORATE CREDIT RATING

In August 2011, the rating agencies Standard&Poor’s and Fitch Ratings

assigned ratings to Ferrovial for the first time; in both cases these ratings

were Investment Grade.

Both agencies affirmed their ratings in the second quarter of 2012:

Agency Rating Outlook

S&P BBB- Stable

FITCH BBB- Stable

CORPORATE BOND ISSUANCE

After the end of the financial year, Ferrovial successfully issued a five-

year EUR500mn bond with an annual coupon of 3.375%, the company’s

first corporate bond issue. Requests were received for more than

EUR5,590mn. The proceeds will be used to cancel corporate debt before

it matures.


14

Consolidated Cash Flow

Dec-12 Ex-infrastructure

projects Infrastructure

projects Adjustments Total

EBITDA 569 358 927

Dividends received 387 -24 363

Working capital -16 -44 0 -60

Operating flow (before taxes) 939 314 -24 1,230

Tax payment -30 -19 -50

Operating cash flow 909 295 -24 1,180

Investment -313 -798 168 -942

Divestment 893 893

Investment cash flow 580 -798 168 -50

Activity cash flow 1,489 -503 145 1,130

Interest flow -32 -286 0 -317

Capital flow & Minorities 0 303 -168 135

Dividend payment -826 -25 24 -827

Forex impact 6 56 0 62

Deconsolidated Debt of assets cassified as held for sale

Other (non-cash) -54 -62 -1 -117

Financing Cash Flow -906 -13 -146 -1,065

Net debt variation 583 -516 -1 65

Net debt initial position 907 -6,102 25 -5,171

Net debt final position 1,489 -6,618 24 -5,105

Dec-11 Ex-infrastructure

projects Infrastructure

projects Adjustments Total

EBITDA 463 356 819

Dividends received 182 -25 157

Working capital -68 -103 -171

Operating flow (before taxes) 578 252 -25 805

Tax payment -67 -25 -92

Operating cash flow 510 228 -25 713

Investment -328 -780 135 -973

Divestment 1,264 1,264

Investment cash flow 936 -780 135 291

Activity cash flow 1,446 -552 109 1,004

Interest flow -114 -293 -407

Capital flow & Minorities -1 263 -136 126

Dividend payment -376 -32 25 -382

Forex impact -27 -97 -124

Deconsolidated Debt of assets cassified as held for sale

14,529 14,529

Other (non-cash) -53 -85 11 -127

Financing Cash Flow -571 14,286 -100 13,614

Net debt variation 875 13,733 9 14,618

Net debt initial position 31 -19,836 16 -19,789

Net debt final position 907 -6,102 25 -5,171


15

CASH FLOW EXCLUDING

INFRASTRUCTURE PROJECTS

OPERATING FLOW

Operating flows by division excluding infrastructure projects in 2012 vs.

2011 are shown in the table below:

Operating flow Dec-12 Dec-11

Construction 100 298

Services 491 164

Dividends from Toll roads 220 159

Dividends from Airports 145

Other -16 -43

Operating flow (before taxes) 939 578

Tax payment -30 -67

Total 909 510

The “Other” line includes operating flows corresponding to the corporate

centre and the holding companies of the Airports and Motorway divisions.

The table below shows the flows for the Construction and Services

divisions:

Construction Dec-12 Dec-11

EBITDA 324 233

Settlement of provisions from completed

works (non cash) -135

Adjusted EBITDA 189 233

Factoring Variation -86 60

Ex Budimex Working Capital 114 -46

Budimex Working Capital -116 51

Operating Cash Flow before Taxes 100 298

Services Dec-12 Dec-11

EBITDA 273 274

Dividends from projects 22 24

Factoring Variation -65 -25

Amey pension scheme payments -22 -20

Amey Working Capital -31 -43

Ex Amey Working Capital 313 -46

Operating Cash Flow before Taxes 491 164

The figure for the Motorways division includes EUR220mn of dividends

and capital repayments from the concession companies responsible for

motorway infrastructure projects. The detail of this is reflected in the

table below.

Dividends and Capital reimbursements

Dec-12 Dec-11

ETR 407 198 133

Serrano Park 1

Spanish toll roads 1

Norte Litoral 6 8

Algarve 1

Via Livre 1

Portuguese toll roads 7 9

Irish toll roads 14 16

Total 220 159

INVESTMENT FLOW

The following table shows a breakdown of the investment flows by

division excluding infrastructure projects, detailing in each case the

investments made and the proceeds received on disposal.

Dec-12 Investment Divestment Investment

Cash Flow

Construction -33 7 -26

Services -102 -6 -108

Toll roads -173 0 -173

Airports 0 876 876

Others -5 16 11

Total -313 893 580

Dec-11 Investment Divestment Investment

Cash Flow

Construction -92 9 -83

Services -99 705 605

Toll roads -134 224 90

Airports

326 326

Others -3 -3

Total -328 1,264 936

Notable elements of the investment flows include, first, the capital

increases at the Motorways division due to the investments in capital

made in the infrastructure projects (principally in the US motorways

under construction), and in Services (Amey projects), and second, the

investment in material fixed assets, principally at the Services division (for

the Murcia contract). The following table shows Cintra’s capital

investments in the infrastructure projects:

Equity investment in toll roads Dec-12 Dec-11

NTE -39 -28

LBJ -65 -47

SH-130 -62 -28

Spanish Toll Roads -2 -16

M-3 -10

Azores -5

Greek Toll Roads

Almanzora -5

Total -173 -134

In terms of the disposals made in 2012, the highlight was at the Airports

division with a net cash inflow of EUR876mn for the sale of 16.34% of

HAH and the costs associated with the disposals made in 2012 (16.34%)

and 2011 (5.88%). “Others” includes the sale of land at Valdebebas

(Madrid) for EUR13.5mn.

In 2011, the principal inflows were at the Services division, both for the

disposal of Swissport (EUR692mn) and the sale of machinery at Amey

(EUR12mn), at the Airports division (disposal of 5.88% of HAH for

EUR326mn) and at the Motorways division, for the disposal of the M-45

(EUR68mn) and the receipt of the delayed payment of 40% of the

Chilean assets (EUR157mn).


16

FINANCING FLOW

The financing flow includes the dividends paid, which in 2012

corresponded to the dividends paid to the shareholders in Ferrovial, S.A.

amounting to EUR832mn and to the minority shareholders in Budimex

(EUR26m). In addition, note that in January 2013 the outstanding

EUR85mn withheld on these dividends was paid to the shareholders.

Additionally, note the net figure for interest payments (EUR32mn),

together with the impact of foreign-exchange movements (+EUR6mn)

and other non-cash debt movements (-EUR54mn), which includes the

accounting movements on debt that have no cash impact.

CASH FLOW FOR INFRASTRUCTURE

PROJECTS

OPERATING FLOW

The operating flows for the companies holding the concessions for

infrastructure projects basically include the inflows at the companies that

are in operation, although it also includes the devoluciones and VAT

payments at the concessions under construction. The following tables

gives the breakdown of the operating flows for the infrastructure

projects:

Dec-12 Dec-11

Toll roads 210 200

Other 85 28

Operating flow 295 228

In terms of operating flows not generated by the Motorways division,

note the improvement in the Services flow, principally as a consequence

of the entry into operation of 100% of the A2 Corridor and Can Mata in

2012.

INVESTMENT FLOW

Note the investment in concession assets under construction at the

Motorways division in 2012, particularly in the USA (the North Tarrant

Express, SH-130 and LBJ) and Portugal (Autopista de Azores).

Dec-12 Dec-11

LBJ -378 -257

SH-130 -169 -201

North Tarrant Express -206 -111

Chicago -4

Spanish Toll Roads -5 -14

Portuguese Toll Roads -12 -51

Other

Toll Roads Total -774 -633

Others -24 -146

Projects Total -798 -780

FINANCING FLOW

The financing flow includes dividend payments and capital repayments

made by the concession companies to their shareholders, as well as the

application of the capital increases received by these companies. In the

case of the concession companies the group consolidates by the global

method, this corresponds to 100% of the amounts paid out and received

by the concession companies, irrespective of the size of the stake held by

the group. No dividends or capital repayments are included for the

companies consolidated by the equity method.

The interest flow reflects the interest paid by the concession companies,

as well as other commissions and costs closely related to obtaining

financing. The flows for these elements correspond to the interest

expenses during the period, together with any other element that implies

a direct variation on the net debt during the period. This amount is not

the same as the financial result in the income statement, fundamentally

due to the differences between payment and accrual of interest.

Interest Cash Flow Dec-12 Dec-11

Spanish toll roads -75 -110

US toll roads -127 -105

Portuguese toll roads -38 -41

Other toll roads -16 -15

Toll Roads Total -256 -271

Other -30 -22

Total -286 -293

Additionally, the financing flow includes the impact of foreign-exchange

movements on foreign currency-denominated debt, which in 2012 was a

positive EUR56mn, fundamentally due to the depreciation of the US dollar

against the euro, which had a significant impact on the net debt of the

motorways in the USA.

Finally, the heading “Other non-cash debt movements” includes elements

that imply a variation in accounting debt, but do not imply any real cash

flows, such as accruals of interest, etc.


17

APPENDIX I: SIGNIFICANT EVENTS

In a public statement, BAA says that the Court of Appeal has

rejected BAA’s appeal against the Competition Commission’s

ruling requiring the sale of Stansted Airport.

(1 February 2012)

BAA announces the sale of Edinburgh Airport.

(23 April 2012)

BAA announced the agreement to sell 100% of its stake in Edinburgh

Airport Limited to Global Infrastructure Partners ("GIP") por

GBP807.2mn.

Colin Matthews, Managing Director of BAA, said: "Edinburgh Airport

and its team have been part of BAA for a long time and we are proud

of its achievements. We wish the new owners every success and are

confident the airport will continue to flourish. BAA will continue to

focus on improving passengers' journeys at Heathrow and its other

airports".

Budimex announces that it has written down its stake in PNI.

(28 June 2012)

The Board of Budimex announced its decision to write down the value

of its stakes in PNI by PLN182,267mn.

Budimex S.A. acquired 100% of PNI for PLN225,017mn. The current

valuation is the consequence of recognising the loss of the contracts

awarded before the acquisition date and whose execution period will

end in 2014.

Budimex will recognise the impairment to its stakes in the company in

the 2011 financial year and adjust the results of the previous years.

The consequence of the current valuation of the company on the

consolidated financial statements of the Budimex group will be a

PLN180,017mn reduction in the attributable goodwill at the acquisition

date. The difference between the two figures comprises the

capitalised transaction costs in the individual financial statements of

Budimex SA.

As a consequence of the above-mentioned losses, Budimex is required

to allocate the PLN40,000,000 proceeds of the capital increase dated

14 June 2012 to the company’s current activities rather than to PNI’s

investments in material fixed assets as had been originally intended.

Additionally, independently of the actions already undertaken,

including the very successful voluntary redundancy programme,

Budimex S.A. intends to introduce a recovery programme at PNI

which will include reorganising PNI’s structures, changing

management methods and minimising the losses on unprofitable

contracts that the company is currently executing.

The introduction of the recovery programme is a demonstration of the

conviction of the Budimex group’s management that the programme

is a viable exercise. The Budimex Board is convinced that the success

of the action taken will confirm that its long-term strategy in the

railway segment is correct, as is its pioneering participation in the

macroeconomic process of privatisation of this segment of the Polish

economy.

Ferrovial reaches an agreement to sell 10.62% of FGP Topco

Ltd. (the BAA holding company).

(17 August 2012)

Ferrovial, which indirectly owns 49.99% de BAA Ltd. (BAA), reaches

an agreement to sell 10.62% of FGP Topco Ltd. (the BAA holding

company) to Qatar Holding LLC for GBP478mn (EUR607mn). As part

of the same transaction, other shareholders in FGP Topco will sell

9.38% at the same price per share, taking the total value of the

transaction to GBP900mn (EUR1,144mn). As a consequence, Qatar

Holding LLC will indirectly own 20% of BAA, and Ferrovial’s indirect

holding in BAA will fall to 39.37%. The deal was subject to the

approval of the European competition authorities, which was granted

on 21 December, such that Ferrovial’s stake in Heathrow Airport

Holdings Ltd. is now 33.65%, and Ferrovial remains the majority

shareholder.

The companies that manage the Radial 4 concession agree to

file for creditor protection.

(14 September 2012)

The Boards of Autopista Madrid Sur Concesionaria Española, S.A. and

Inversora de Autopistas del Sur, S.L., the management companies of

Madrid’s Radial 4, in which Ferrovial, S.A., Sacyr Vallehermoso, S.A.

and Caja Castilla La Mancha Corporación, S.A., have indirect stakes,

have agreed to file for court protection from their creditors.

The Radial 4 project has been directly affected by exogenous factors

(substantially lower traffic than expected, higher expropriation costs

than expected, economic crisis, etc.) that under current conditions

prevent the concession from meeting various payment commitments

to expropriated landowners and financial entities. An important factor

in this decision has been that the intended potential legal supports for

the concession were not correctly implemented by the contracting

entity.

In view of all the above, the said companies have taken the above-

mentioned and legally binding decision, in the confidence that a

solution will be reached within the coming months.

As noted in the group’s consolidated 2011 report and accounts, the

investment relating to this project is already provisioned in full. There

is not expected to be any significant impact on the group’s accounts

whatsoever.


18

The companies that manage the development of the AP-36

Ocaña–La Roda motorway agree to file for creditor

protection.

(19 October 2012)

Autopista Madrid Levante Concesionaria Española, S.A.U. and

Inversora de Autopistas de Levante, S.L., the companies managing

the AP-36 Ocaña–La Roda toll motorway, indirectly owned by

Ferrovial, S.A. (55%) together with Sacyr Vallehermoso, S.A. (40%)

and Caja de Ahorros y Monte de Piedad de Gipuzkoa y San Sebastián,

S.A. (5%), agreed to seek creditor protection. The application was

been made to the competent court.

The AP-36 motorway has been directly affected by exogenous factors

(substantially lower traffic than expected, economic crisis and

increased capacity on alternative routes, etc.), making it imminently

impossible to meet various payment commitments to financial entities.

An important factor in this decision has been that the intended

potential legal supports for the concession were not correctly

implemented by the contracting entity.

In view of all the above, the said companies have taken the above-

mentioned decision, in the confidence that a solution will be reached

within the coming months.

The investment relating to this project was provisioned in full in the

group’s 2011 accounts, and no significant impact whatsoever is

expected on the 2012 accounts.

FERROVIAL reaches an agreement with Stable Investment

Corporation to sell 5.72% of FGP Topco Ltd.

(31 October 2012)

Ferrovial, up until then the indirect owner of 49.99% of Heathrow

Airport Holdings Ltd. (the former BAA Ltd.), reached an agreement

with Stable Investment Corporation (Stable), a wholly-owned

subsidiary of CIC International Co. Ltd., to sell 5.72% of FGP Topco

Ltd. (the holding company of Heathrow Airport Holdings Ltd.) for

GBP257.4mn (EUR319.3mn).

As part of the same transaction, other shareholders in FGP Topco sold

4.28% at the same price per share. As a consequence, Stable now

has an indirect 10% stake in Heathrow Airport Holdings Ltd.

The deal with Stable was not subject and was closed on the same day

that it was announced. Ferrovial’s indirect holding in Heathrow Airport

Holdings Ltd. was thus then 44.27%.

On 17 August, Ferrovial announced the sale of 10.62% of FGP Topco

Ltd. to Qatar Holdings LLC. This transaction was subject to the

approval of the European competition authorities, which was granted

on 21 December. Ferrovial’s stake in Heathrow Airport Holdings Ltd. is

thus now 33.65%, and it remains the majority shareholder.

EVENTS AFTER THE CLOSE

Ferrovial successfully issued a EUR500mn bond maturing on

30 January 2018.

(18 January 2013)

Ferrovial Emisiones, S.A., a Ferrovial subsidiary, successfully priced a

EUR500mn bond (the Bonds) maturing on 30 Janary 2018,

guaranteed by Ferrovial and some of its subsidiaries. The Bonds have

a coupon of 3.375% payable annually.

On 3 January the Bonds were subscribed and paid up by the

investors, and listed in the official London market.

The net proceeds of EUR497.75mn will be applied to amortise

outstanding corporate debt.


19

APPENDIX II: PRINCIPAL CONTRACT AWARDS

CONSTRUCTION

US Route 460 Corridor, US460 Mobility Partner LLC., USA.

407 East Extension, 407 East Development Group, Canada.

T3 Integrated BAGGAGE, Design, Build and Integration, Heathrow,

UK.

Tokamak Iter, Fusion Energy, France.

Angostura Toll Both, Ruta del Maipo Soc. Concesionaria, Chile.

Correa Tunnel, Codelco Chile, Chile.

Security mesures of Maule, Ruta del Maule Soc. Concesionaria, Chile.

Construction stand and taxi lanes for T2B, Heathrow, UK.

Construction Pr9 Ponce, Highways & Transport Authority, Puerto Rico.

Operation and maintenance, Edar Sur Oriental, Canal de Isabel II,

Spain.

Security mesures of Bos, Ruta del Maipo Soc. Concesionaria, Chile.

Operation and maintenance Edar La China, Canal de Isabel II, Spain.

Cerrejón Port, Carbonera del Cerrejón Ltd., Colombia.

Electricity interconnection France-Spain, INELFE, France.

Resurfacing Pr-30, Highways & Transport Authority, Puerto Rico.

Maintenance. Idam Valdelentisco, ACUAMED, Spain.

Padornelo Tunnel, ADIF Infraestructuras, Spain.

Espiño Tunnel, ADIF infraestructuras, Spain.

A-66 Freeway Benavente-Zamora, Autovía de la Plata, Spain.

Construction of Via Olmedo-Pedralba, ADIF Infraestructuras, Spain.

Pipework Forzada Moralets Ii, Endesa Generación, S.A., Spain.

250 housing units, Interbigeco Alcala, Youth Housing, Interbigeco II,

Spain.

Gas pipeline Son Reus-Andraitx, ENDESA, S.A., Spain.

Urbanization Leganés Tecnológico, Spain.

Gas pipeline El Tiemblo-Cebreros, Transportista Regional del Gas,

Spain.

BUDIMEX

Road to the Dabrowica junction, Lublin, Poland.

C/Kruczkowskiego complex in Warsaw, Poland.

Waste treatment plant in Bialystok, Poland.

Cultural meeting centre in Lublin, Poland.

New takeoff runway Pyrzowice international airport, Poland.

Remodelling of a tramline in Cracow, Poland.

Stawiski ring road, Poland.

Extension of Nº 892 Voivodía Road, Zagorz - Komancza, Poland.

Neptune office centre, Poland.

Darlow coastal defences, Poland.

Boarding for Ferry Nº 1 in Swinou Port, Poland.

Teaching centre for the Chemistry Faculty, Poland.

JMD distribution centre Gdansk, Poland.

Construction of new roads in Gdansk, Poland.

822 Voivodía Road, Lublin – Swidni Airport, Poland.

Corporate services centre in Plock, Poland.

WEBBER

US-290 Harris City Const 5 ML, TxDOT, USA.

US-59 Angelina, TxDOT, USA.

Rockwall County IH30, TxDOT, USA.

Homestead Grade Separation, City of Houston, USA.

SERVICES

CESPA

Contract award for two waste treatment plants for the Juan el Grande

and Salto del Negro environmental complexes in the Canary Islands.

Contract renewal for highway cleaning and urban waste collection for

the municipality of San Vicente del Raspeig.

Renewal of contract for green space maintenance and cleaning in

various districts in Madrid (Centre, Arganzuela, Retiro, Salamanca,

Tetuán, Chamartín, Chamberí, Vallecas, Moratalaz and Vicálvaro).

Extension of highway cleaning and urban waste collection contract for

the municipality of Getxo.

Extension of contract for highway cleaning, urban waste and solid

waste collection for the city of Guadalajara.

Contract renewal for the industrial management of metal scrap and

waste at the Ford vehicle plant.

FERROSER

Supply and management of energy services and maintenance of

municipal buildings and public lighting in Torrejón de Ardoz.

Ministry of Development contract award for the maintenance of

various sections of the State highway network (the cities of Zaragoza,

Madrid, Valencia, Salamanca, Segovia, Valladolid and Badajoz).

New contract award for telephone services for the Madrid Town Hall.

Contract extension for cleaning at the La Paz University Hospital.

New contract award for the integrated building management for the

Universidad Europea de Madrid.

Extension of cleaning contract for the 12 October hospital complex.

Contract for the maintenance of energy services in the outdoor

lighting installations of the municipality of Soto del Real in Madrid.

Prorogation of contract for integrated services management in the

Villaverde district, Madrid, lots 1 and 3.

AMEY

Infrastructure maintenance services for the County of Sheffield.

Installation contract for electricity supply to railways in Norfolk.

Contract for maintenance and cleaning services for the Home Office

building.

Extension of infrastructure maintenance contract for the County of

Hampshire.

Infrastructure maintenance for the County of Calderdale.

Consultancy contract for maintenance of general traffic services in

Scotland.

Various consultancy and technical advisory contracts for railway

signalling.


20

APPENDIX III: EXCHANGE-RATE MOVEMENTS

Exchange-rate Last

(Balance sheet) Change% 12/11

Exchange-rate Mean (P&L)

Change% 12/11

GBP 0.8130 -2.7% 0.8107 -6.7%

US Dollar 1.3200 1.9% 1.2911 -7.8%

Canadian Dollar 1.3130 -0.3% 1.2896 -6.5%

Polish Zloty 4.0850 -8.5% 4.1675 0.7%

Exchange rates are expressed in units of currency per euro, with negative variations signifying euro depreciation and positive variations euro

appreciation.

INVESTOR RELATIONS DEPARTMENT

ADDRESS: PRÍNCIPE DE VERGARA 135 - 28002 MADRID

TELEPHONE: +34 91 586 25 65

FAX: +34 91 586 26 89

E-MAIL: [email protected]

WEB: HTTP://WWW.FERROVIAL.COM

Important information

This document contains statements regarding the Company’s future intentions, expectations and forecasts at the time of writing. These statements are

based on projections and financial estimates with underlying assumptions, announcements relating to plans, objectives and expectations that refer to

various aspects, including the growth of the various lines of business and the global business, market share, the Company’s results and other aspects

relating to its activities and situation.

These estimates, projections and forecasts are not in themselves guarantees of future performance as they are subject to risks, uncertainties and other

important factors that could result in the development and final results differing from those contained in these estimates, projections and forecasts.

This should be taken into account by all individuals or institutions that might have to take decisions or form or transmit opinions relating to stocks and

shares issued by the Company, and in particular, by the analysts and investors who consult this document. All interested parties are invited to consult

the documentation and information publicly available or filed by the Company with stock market supervisory authorities and, in particular, the

information filed with the CNMV (the Spanish stock market regulator).

january - december 2012 results

Investor Relations