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ACS gains 416 million euros in the first half of 2017, 7.2% more

Sales reached 17,386 million euros, an increase of 11.7%

28-07-2017
  • Backlog increases by 5,9% up to 65.200 million euros
  • Net debt decreased by 55.8% in the last twelve months down to 1,654 million euros (0.7x annualized EBITDA)

    Consolidated Results
    Sales in the first half of 2017 accounted for 17,386 million euros, representing an increase of 11.7%. The good production performance in this semester, especially in the construction activity that grows 15.5%, confirms the growth trend shown in the first quarter of the year.
    The geographical distribution of sales shows the broad diversification of the Group, with North America accounting for 44% of sales, Europe 20%, Australia 20%, Asia 8%, South America 6% and Africa the rest 2%. Sales in Spain account for 13% of total sales.
    Backlog at the end of the first half of 2017 amounted to 65,200 million euros, 5.9% higher than the one twelve months ago despite the depreciation of the US dollar, with an equivalent sales geographical breakdown.
    Total EBITDA accounted for 1,224 million euros in the first half of 2017, increasing 12.2% in line with the increase in production, with all activities showing good operating performance.
    Likewise, net operating profit (EBIT) stood at 900 million euros after increasing by 7.6%. Sales margin decreased slightly to 5.2% as a result of a higher increase in depreciation due to growth in more capital intensive activities (eg mining).
    The attributable net profit in the first half of 2017 increased by 7.2% to stand at 416 million euros. This growth would be 19.1% if Urbaser's contribution was excluded in 2016. 
    Construction activity grew 24.9%, supported by the excellent performance of HOCHIEF and its subsidiaries, whose contribution to the consolidated profit of the Group increased by 35%.
    Net profit in Industrial Services grew 4.6% thanks to the boost of international activity and the rebound of the Spanish market.
    Net profit of Services reaches 14 million euros that corresponds to Clece after the sale of Urbaser and Sintax at the end of 2016.
    The net impact of Corporación decreased by 31.1% due to lower corporate financial expenses in relation to the previous year.

    Financial Situation
    Net debt of Grupo ACS accounted for 1,654 million euros, decreasing 55.8% since June 2016 and 72% in the last four years. The Group's financial leverage stands at 0.7 times annualized EBITDA.
    During the first half of 2017, cash flows generated by operations, before operating working capital variations that have a seasonal effect in this half, totaled 907 million euros, a 5.5% increase thanks to the increase in operating results and a 23% decrease in net financial expenses.
    The total volume of Grupo ACS investments during the first half of 2017, including operational, financial and concessionary projects, amounted to 364 million euros, mainly in mining machinery in CIMIC and in energy assets by Cobra.
    Total divestments reached 140 million euros, highlighting Sintax sales, worth 55 million euros, and the sales of the hospitals in the Balearic Islands, on the part of Iridium, worth 43 million euros.

    Results per Area of Activity

    Construction
    Sales in Construction, in the first half of 2017, accounted for 13,102 million euros, showing an increase of 16% due to the strong growth of the activity in Australia and the stability of the North American market.
    Grupo ACS international sales in the Construction area amounted to 12,550 million euros, which represents 96% of total sales in this area, being North America and Australia the most important markets. Domestic sales represent 4% of total.
    Construction EBITDA accounted for 834 million euros, with a margin over sales of 6.4%, after growing a 17% in line with the sales increase.
    Net profit reached over 196 million euros, showing an increase of 25%.
    Construction Backlog, at the end of the first half 2017, accounted for 54,303 million euros, 6% more than twelve months ago. International backlog represents 95% of total in the Construction area.

Amongst the most important awards during the first half 2017, these are the most significant:

  • Project for a new metro line that consists of the construction of two 15.5 Km long twin tunnels and the associated works at Sydney Harbour (Australia).
  • Mining operating contract in Mount Pleasant coal mine (New South Wales, Australia).
  • Construction of the East Kowloon cultural centre in Hong Kong.
  • Works of enlargement of Hong Kong airport terminal 1.
  • Contract for full-service maintenance of different municipal facilities in Auckland (New Zeeland).
  • Enlargement of highway A10 and its undergrounding through Amsterdam Zuid Station (Amsterdam, Holland).
  • Construction of a new bridge in the current road NC12 between Pea Island National Wildlife Refuge and Rodanthe City (North Carolina, United States).
  • Design, construction, finance and maintenance of 10.6 kilometres of enlargement at highway 427 in Ontario (Canada).
  • Design and construction of Northlink phase 3 which consists of a two-lane motorway between Ellenbrook and Muchea (Perth, Australia).
  • Enlargement of M1 Pacific Motorway (New South Wales, Australia).
  • Construction and development of line 3 metro stations in Santiago de Chile (Chile).
  • Improvement works of two tunnels at Myrtle Avenue railway lines (New York, United States).
  • Design, construction and maintenance of four primary schools in Auckland and Hamilton (New Zeland).
  • Building of a new school in Jackson Heights (New York, United States).
  • Construction of the residential building Schwabinger Carre II in Munich (Germany).
  • Construction of the new office complex Lister Drejeck in Hannover (Germany).
  • Construction of the new Hospital de la Policía Nacional del Perú, Lima (Peru).
  • Project for the improvement of Woodleigh Waterworks water treatment plant (Singapur).
  • Project for the enlargement and improvement of Junee prison (New South Wales, Australia).
  • Improvement works of highway I-95 in Miami (Florida, United States).
  • Enlargement of San Diego’s airport terminal (California, United States).
  • Construction of the office complex Business Garden in Wroclaw (Poland).
  • Improvement works at Stratford Institute (Connecticut, United States).
  • Enlargement of highway SH 199 in Tarrant County (Texas, United States).
  • Improvement works at the interchange between the state highway 93 (I-75) and the state highway 64 in Manatee County (Florida, United States).

Industrial Services
Sales in Industrial Services reached 3,590 million euros, increasing by 4% due to the good evolution of the international activity and the recovery of the domestic market. Particularly, 2,614 million euros, 73%, correspond to international sales which have increased by 4%.
EBITDA accounted for 379 million euro, showing an increase of 4%, with a margin over sales of 10.6%, stable in relation to the comparable period.
Equally, Net Profit reached 209 million euros, 5% higher than in the same period of 2016.
Industrial Services has increased its backlog by 4% up to 8,906 million euros at the end of the first semester 2017, equivalent to 17 months of production, being 77% international contracts. The most important awards of the period, first half 2017, are:

  • Contract for the installation and maintenance of Santa María’s and Orejana’s photovoltaic plants, with an installed capacity of 166 MW and 125 MW, respectively, in Mexico.
  • Project EPC for the construction of Matsuzaka photovoltaic plant with an installed capacity of 100 MW (Japan).
  • Design, construction, operation and maintenance of Gamboa’s water treatment plant (Panama).
  • Project for the enlargement of the potabilization capacity of General Belgrano’s plant (Buenos Aires, Argentina).
  • Project for the optimization of drinking water supply and sewage in the Northern area of Lima (Peru).
  • Awarding of two contracts for the installation and maintenance of medium and low voltage networks for Enel in Liguria and Western Piamonte (Italia).
  • Project EPC for the construction of the hydroelectric power station of Hidromanta with an installed capacity of 19.80 MW (Peru).
    Outsoucing of sales points in 6,000 Repsol’s service stations (Spain).
     
    Services
    Services area accounted for sales of 706 million euros, which only correspond to Clece, remaining virtually stable in comparable terms.
    EBITDA in Services accounted for 36 million euros with a margin over sales of 5.1%, similar to the previous year, excluding the impact of the sale of the logistic activity.
    Net Profit accounted for 14 million euros, and it excludes the extraordinary results of the sales of different assets. Clece’s Net profit increases a 0.5%.
    Services Backlog reaches 1,991 million euros, equivalent to 16 months of activity.