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Investing.com -- Ferrovial SE (BME:FER) shares fell more than 2% on Friday after the company reported weaker-than-expected fourth-quarter 2024 earnings.
EBITDA came in at €334 million, missing consensus estimates by 10%, mainly due to underperformance in the construction division and provisions related to a Colombian project.
However, the core toll roads business remained relatively stable, coming in just 3.5% below consensus.
Despite the earnings miss, Ferrovial announced an incremental share buyback program of up to €500 million, a move seen as a net positive, though below BofA Securities’ earlier expectations of over €1 billion.
The Spanish company indicated the buyback could be increased depending on reinvestment opportunities.
Ferrovial’s U.S. managed lanes segment continued to perform well, with strong year-over-year revenue growth across key assets, including I-66, I-77, NTE, LBJ, and NTE35W.
Traffic volumes were up across most assets except for NTE, which saw a slight decline due to construction. I-77 and I-66 distributed their first dividends, totaling $307 million and $172 million, respectively.
The company’s financial position remains solid, with net cash (excluding infrastructure) at €1.79 billion, compared to a net debt position of €418 million in Q3.
This includes proceeds from the €2 billion sale of its Heathrow stake, completed in December 2024, though proceeds from the €500 million AGS airports sale (closed in early 2025) are yet to be factored in.
On February 26, Ferrovial announced the sale of its remaining 4.75% Heathrow stake, which will generate an additional €500 million.
Attention has also turned to Ferrovial’s stake in Canada’s ETR407 toll road, which accounts for 34% of BofA’s valuation.
ETR407 reported a 17% year-over-year increase in Q4 EBITDA to CAD370 million, with traffic improving slightly but still 9.9% below 2019 levels.
The road’s operator expects EBIT growth in 2025, though Schedule 22 penalties remain a concern.
BofA estimates a CAD215 million EBIT decline for ETR407 this year due to penalties, though recent guidance suggests they may be lower than initially expected.