Tecnicas Reunidas Q1 2025 presentation: Record backlog drives ambitious growth targets

Introduction & Market Context

Tecnicas Reunidas (BME:TRE) shares jumped 5.65% to €17.29 on May 14, 2025, as the Spanish engineering firm unveiled strong Q1 results featuring record order backlog and continued margin improvement. The company’s presentation, delivered by Executive Chairman Juan Lladó and CEO Eduardo San Miguel, highlighted significant progress across key financial metrics and strategic initiatives.

The positive market reaction follows a period of steady growth for the company, whose stock has traded between €9.83 and €18.10 over the past 52 weeks. Today’s gains reflect investor confidence in the company’s expanding project pipeline and improving profitability.

Quarterly Performance Highlights

Tecnicas Reunidas reported robust financial results for Q1 2025, demonstrating continued momentum from its strong 2024 performance. The company achieved sales of €1,307 million, representing a 30% increase compared to €1,003 million in Q1 2024. EBIT reached €56.4 million with a margin of 4.3%, showing steady improvement from the 3.8% margin in 2023 and 4.1% in 2024.

As shown in the following chart of quarterly financial performance:

The company maintained a solid net cash position of €423 million, up 27% from €333 million in Q1 2024, reflecting strong financial discipline and improved operational efficiency.

Strategic Initiatives

The most significant development in Tecnicas Reunidas’ Q1 results was the exceptional growth in its order backlog, which reached €14.9 billion, representing a 41% increase. This record backlog was driven by strong order intake of €3.7 billion in Q1 2025, including major projects like Lower Zakum and Vaca Muerta.

The following chart illustrates this remarkable growth trajectory:

A cornerstone of this backlog expansion is the Lower Zakum project in the UAE, a €3.3 billion contract with ADNOC Offshore. This strategic project, for which Tecnicas Reunidas is the sole contractor, will span five years and involve approximately 1 million engineering man-hours, with Madrid’s Engineering Hub leading the effort.

The company’s commercial pipeline remains robust at €66.2 billion for the next 24 months, with the Middle East representing 55% of opportunities, followed by North America at 28%. Notably, decarbonization projects account for €12.9 billion in EPC opportunities and €2.0 billion in track & Services.

New Growth Areas

Tecnicas Reunidas identified three key growth areas that will drive future expansion: the US market, Power generation, and Energy Transition projects.

In the United States, the company is capitalizing on investments in traditional energy sources, LNG developments, and emerging opportunities in power generation and data centers. With a €10.2 billion pipeline in the US, Tecnicas Reunidas is leveraging its strategic relationships with American clients and construction partners to accelerate growth in this market.

The Power sector represents another significant opportunity, with 13 GW currently under execution and over €12 billion in pipeline projects for the next 24 months. The company has established strategic partnerships with all four major OEMs ( Siemens (ETR:SIEGn) Energy, Mitsubishi Heavy Industries, GE Vernova, and Ansaldo Energia) and is well-positioned in regions where electrification demand is surging.

In the Energy Transition space, Tecnicas Reunidas is working on a €15 billion decarbonization pipeline, focusing on blue and green ammonia, carbon capture, and sustainable aviation fuel (SAF) projects. The company recently signed a Memorandum of Understanding with BBVA (BME:BBVA) to collaborate on identifying and financing decarbonization projects, aligning with BBVA’s sustainable business pipeline target of €700 billion from 2025 to 2029.

Financial Analysis

Tecnicas Reunidas’ financial performance shows consistent improvement across key metrics. Sales have grown steadily quarter-over-quarter, from €1,003 million in Q1 2024 to €1,307 million in Q1 2025. Similarly, EBIT has increased from €40.2 million to €56.4 million over the same period, with margins expanding from 3.8% in 2023 to 4.3% in Q1 2025.

The balance sheet continues to strengthen, with gross cash reaching €1,058 million (up 10% from 2022) and gross debt decreasing to €635 million (down 21% from 2022). The company’s equity position has more than doubled since 2022, growing from €258 million to €626 million in Q1 2025.

This financial strength provides Tecnicas Reunidas with the flexibility to pursue strategic growth opportunities while maintaining a conservative approach to risk management.

Forward-Looking Statements

Based on its record backlog and strong market positioning, Tecnicas Reunidas provided ambitious guidance for 2025 and 2026. For 2025, the company expects revenues to exceed €5,200 million with an EBIT margin of approximately 4.5%. Looking ahead to 2026, the company aims to achieve revenues above €5,500 million and an EBIT margin exceeding 5%.

Notably, Tecnicas Reunidas plans to resume its dividend policy with 2026 results, signaling confidence in its long-term financial outlook. The company also announced a Capital Markets Day update scheduled for September 2025, where it will likely provide more detailed strategic plans.

As shown in the following summary of the company’s outlook:

These targets represent a continuation of the growth trajectory established in 2024, when the company reported sales of €4,500 million (an 8% year-over-year increase) and an EBIT of €181 million (up 16% from the previous year).

With its record backlog providing high sales visibility and consistent delivery reinforcing margin expansion, Tecnicas Reunidas appears well-positioned to capitalize on growing opportunities in both traditional energy markets and emerging decarbonization projects, supporting its ambitious financial targets for the coming years.

Full presentation:

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