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ACS Group’s net profit totals EUR 739 million

- Turnover climbs to EUR 18.209 billion, a 61% increase over the same period in 2010.

14-11-2011
- Since the group incorporated Hochtief in June 2011, international turnover has grown to 64.9% of the total.
- The ACS Group’s ordinary net profit grew by 6.6% to EUR 738 million.

Consolidated Results
From January to September 2011, the ACS Group achieved a total turnover of EUR 18.209 billion, a 62.1% increase over the prior year. International sales accounted for EUR 11.819 billion, or 64.9% of the total, and rose 232.3% over the prior year.
The gross operating profit (EBITDA) climbed 39.1% to EUR 1.532 billion with a sales margin of 8.4%. The earnings before income and taxes (EBIT) grew by 14.8% to reach EUR 957 million with a sales margin of 5.3%.
The recurring net profit, i.e., the profit from continuous activities, excluding any extraordinary results and capital gains from asset sell-offs, increased 6.6% to EUR 738 million.
The net profit totalled EUR 739 million, 34.7% less than the prior fiscal year due to capital gains brought in last year, in particular the gains from the sale of 15.5% of Abertis in September 2010.
The capital gains from the sale of the 20 La Boga and Península wind parks and the Vespucio Norte and Túnel de San Cristóbal motorways in Chile, both of which were approved in the third quarter of 2011 but are still pending authorization, have not been factored into the results as of September 2011.
The total works portfolio at the end of September 2011 amounted to EUR 62.223 million, with particularly strong growth at 319.8% in the international portfolio, which currently accounts for 79.4% of the total.

Results by Business Area

Construction
The Construction division achieved sales in the amount of EUR 11.585 billion, or 148.1% more than in 2010, thanks to the consolidation of Hochtief in this area of the business by the global integration method beginning on June 1, 2011.
International sales in the ACS Group’s Construction business have grown substantially to EUR 8.914 million, an amount equivalent to 77% of the total construction turnover.
The gross operating profit (EBITDA) reached EUR 733 million, which represents a 101.6% increase and a sales margin of 6.3%. The net profit was EUR 197 million, or 14.9% less than the prior year due to a 20% decline in sales in Spain.
The works portfolio at the end of September amounted to EUR 46.391 billion euros, which is the equivalent of 21 months of production. The international portfolio has already come to represent 91% of the total

Construction portfolio.
Some of the most important contracts awarded to the Group from January to September 2011 include the following:

- mining management contracts in Australia and Indonesia for the extraction of coal, worth more than EUR 1.5 billion
- contracts for the construction of the Royal Adelaide Hospital and the Perth Children’s Hospital in Australia worth more than EUR 1.250 billion
- the construction and remodelling of the Forth Crossing bridge in Scotland, a project worth a total of EUR 950 million
- a contract for the construction and design of a tunnel on the SR-99 in Seattle (United States) worth EUR 450 million
- a contract to build a railway bridge and tunnel, stations and viaducts for the South Island railway line in Hong Kong, worth more than EUR 400 million
- a contract to build and maintain the A8 motorway in Germany, worth more than EUR 380 million
- a contract to remodel the convention centre in Oakland, California, worth nearly EUR 225 million
- a contract to build the S8 motorway between Lodz and Wroclaw in Poland, worth 137 million
- a contract to build the A-308 motorway between the towns of Iznalloz and Darro (Granada) with an investment of EUR 73 million

Industrial Services
Sales in the Group’s Industrial Services division have decreased by 1.3% to EUR 5.392 billion over the January-September period due to a decline in the Spanish domestic market, especially in the comprehensive projects segment. International sales, on the other hand, grew by 31.4% to reach EUR 2.573 billion, or 48% of the total. This strong increase is due to new production in Latin American countries like Mexico, Brazil, Chile and Peru. The Group has also seen strong growth in the Asian market, which already represents nearly 8% of the international sales of Industrial Services.
The gross operating profit (EBITDA) grew by 10.8% to EUR 654 million. The net profit rose to EUR 406 million, which is 44.3% more than in the same period during the prior year.
This division finished out the period with a portfolio worth EUR 6.763 billion, which is the equivalent of 11 months of production, and a total of 58% originating from international contracts.
Some of the most important contracts awarded during these nine months include:

- a project for the turnkey construction of a 500 MW combined-cycle plant in Parnaíba (Brazil) worth EUR 262 million
- a contract to build the Renace II Hydroelectric Plant in Alta Verapaz (Guatemala), worth EUR 152 million
- a contract to build two wind parks in Salamanca totalling 70 MW, worth EUR 101 million
- a turnkey contract for two support facilities for the Eldfisk II oil platform in the North Sea (Norway), worth EUR 96 million
- a contract for a maritime terminal and storage plant for liquefied petroleum gas in Quito (Ecuador), worth EUR 95 million
- a contract for signage and control services for a set of highways in Huesca, worth EUR 91 million
- a contract to build a 200 MW open-cycle power plant in the Lambayeque region of Peru, worth EUR 90 million
- a project to build a 50 MW thermosolar plant in Caceres, worth EUR 55 million
- a project to expand the high-voltage lines between Cuiabá and Rio Verde Norte in Brazil, worth EUR 50 million
- a contract to build a national gas storage terminal in Guadalajara (Mexico), worth EUR 35 million

Environment
The Environment division achieved sales of EUR 1.281 billion, which represents a total growth of 11.9%. The gross operating profit (EBITDA) for the division reached EUR 193 million, with the sales margin at 15.1%. The net profits amounted to EUR 115 million.

The division’s current portfolio is valued at EUR 9.069 billion euros, which is equivalent to 66 months of activity. International markets account for 37% of the portfolio. The most significant contract awards for the period are:

- waste collection and street cleaning contracts in Viladecans and in Parets del Vallès (both in Barcelona) worth a total of EUR 53 million
- a contract to operate the Las Mulas dump ground in Fuenlabrada, Madrid (worth EUR 29 million)
- an extension of the contract to operate the comprehensive waste treatment plant in Meruelo, Cantabria (EUR 20 million)
- a waste collection and street cleaning contract with the Gosport Borough Council, United Kingdom (EUR 26 million)
- contracts in France worth a total of EUR 33 million for urban waste collection in the Boucle de la Seine Communauté de Communes (Île de France) and in the municipality of La Ciotat (Marseille)

Debt and net investments
The funds generated by operational activities from January to September 2011 amounted to EUR 774 million, nearly the same as twelve months ago. The positive operating results and the global consolidation of Hochtief since June have been compensated by the seasonal nature of the evolution of working capital in the construction side of the business.
In the first nine months of 2011, the gross investments totalled EUR 3.782 billion, whereas the divestments amounted to EUR 1.536 billion.
The main line item is the EUR 1.076 billion investment to acquire approximately 21.7% of the equity of Hochtief. There have also been significant investments by Hochtief itself, which has invested EUR 1.020 billion in concessions and equipment for the mining business. Iridium has likewise invested EUR 593 million, and the Industrial Services division has invested EUR 961 million, primarily in energy projects.
The most notable divestments include Leighton’s sale of the HWE mining contracts for EUR 540 million and the sale of the renewable energy and transmission line projects in Brazil for EUR 595 million.
Additionally, over the last three months, the Group has agreed to sell various concession and renewable energy assets worth a total of EUR 1.775 billion. These projects are still pending execution, and as such, their results were not included in the financial statements for the period. The expectation is to close these operations prior to the end of the fiscal year.
The net debt of the ACS Group at 30 September 2011 is EUR 9.698 billion, of which EUR 7.098 billion constitute non-recourse financing for shareholders, including EUR 5.645 billion in debt for the vehicles used to acquire the shares of Iberdrola, which will reach maturity in the period from late 2014 to March 2015. The remainder corresponds to the financing of concession projects (EUR 805 million) and Hochtief projects (EUR 648 million), which were recently refinanced through July 2015.