• EBIT Margin: 3.9% for the first nine months of 2024.
• Dividends from Infrastructure Assets: EUR190 million received, including the first dividend from the I-77.
• Proceeds from Sale of IRB Stake: EUR211 million.
• Proceeds from Amey Vendor Loan Divestment: EUR176 million.
• Shareholder Distributions: EUR749 million in buybacks.
• Investment in IRB Infrastructure Trust: EUR652 million.
• US Toll Roads Revenue and EBITDA Growth: In excess of 20%.
• Dividends from North American Assets: EUR444 million.
• 407 Toll Road Revenue Growth: 16.1% for the quarter.
• 407 Toll Road Dividends: CAD175 million plus CAD125 million, with a CAD700 million dividend approved for the last quarter.
• NTE 35W Revenue Share: $3.4 million in Q3, $10.1 million for the first nine months of 2024.
• I-77 Revenue Share: $1.2 million in Q3, $3.6 million for the first nine months of 2024.
• Heathrow Passenger Numbers: Record-breaking figures.
• AGS Revenue Growth: High-single digit, with adjusted EBITDA above 20%.
• Dalaman Revenue Growth: 7.4% for the first nine months.
• New Terminal One Equity Contribution: $347 million in the first nine months, $160 million in Q3.
• Construction EBIT Margin: 7.8% for Budimex, 3.0% for Webber, 1.9% for Ferrovial Construction.
• Dividends from Projects: Close to EUR500 million.

• Warning! GuruFocus has detected 7 Warning Signs with FER.

Release Date: October 30, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ferrovial SE (NASDAQ:FER) reported strong results in the third quarter of 2024, with toll roads benefiting from increased mobility, particularly in Canada and the US.
• The airports division saw record-breaking numbers at Heathrow and strong growth in AGS and Dalaman, indicating robust performance in the aviation sector.
• The construction segment showed profitability improvement, with a healthy backlog and increased EBIT margins across Budimex, Webber, and Ferrovial Construction.
• Ferrovial SE (NASDAQ:FER) received significant dividends from infrastructure assets, totaling EUR190 million, and proceeds from various sales, enhancing cash flow.
• The company announced an additional buyback program for a maximum amount of EUR300 million, reflecting a commitment to shareholder returns.

Negative Points

• Traffic on the 407 was affected by adverse weather conditions, including heavy rain, impacting overall performance.
• Construction works on the NTE and I-77 managed lanes affected traffic and revenue, posing challenges to growth in these areas.
• The comparison of Heathrow's results to 2023 was negatively impacted by the gliding path of aeronautical tariffs and higher costs.
• Ferrovial SE (NASDAQ:FER) faced competition challenges in the US express lanes market, with a disappointing result in Atlanta.
• The company's construction segment experienced a cash drain, although it was better than the previous year, indicating ongoing financial pressures.

Q & A Highlights

Q: How does Ferrovial plan to compete for express lane opportunities in the US, especially after a disappointing result in Atlanta? Are there other investment opportunities being considered? A: Ernesto Mozo, CFO, explained that Ferrovial will leverage design and financial discipline to compete for new business. The segmented pipeline offers a fair chance of winning. Ferrovial is also exploring bespoke opportunities in energy and other sectors, but not planning significant investments in data centers at this time.

Q: What is the expected impact of construction works on NTE traffic, and when will Schedule 22 provisions for the 407 begin? A: Ignacio Madridejos, CEO, stated that NTE construction impacts will last until early 2027. Ernesto Mozo, CFO, added that Schedule 22 provisions will start in Q1 2025, with more concentration in Q2 and Q3 due to traffic patterns.

Q: What is the strategic rationale behind the JV with Interogo Holding, and how has weather impacted traffic on I-66 and I-77? A: Ernesto Mozo, CFO, explained that the JV allows for asset rotation, focusing on mature assets. Ignacio Madridejos, CEO, noted that weather negatively impacted traffic on I-66 and I-77, but specific impacts were not quantified.

Q: Can you provide an update on capital returns and the size of new tenders? A: Ernesto Mozo, CFO, clarified that EUR270 million of capital returns were catch-up from last year. He did not disclose the size of pending projects for commercial reasons but indicated that granters might provide CapEx figures in the future.

Q: What is Ferrovial's approach to pricing and traffic for the 407 ETR, especially with Schedule 22 coming into effect? A: Ernesto Mozo, CFO, mentioned that while some fees did not increase, toll per kilometer did, affecting revenue growth. Loyalty schemes tested this year will play a significant role next year, but specific strategies were not disclosed.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.