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Sacyr SA reported a robust financial performance in Q1 2025, with consolidated turnover increasing by 7% to €1,059 million and net profit rising by 5% to €27 million. Despite these gains, the stock saw a slight decrease of 0.16% in market trading. According to InvestingPro analysis, Sacyr appears undervalued at current levels, with a "GOOD" overall financial health score. The company remains focused on strategic investments and maintaining stable debt levels.
Key Takeaways
- Consolidated turnover increased by 7% to €1,059 million.
- Net profit rose by 5% to €27 million.
- Operating cash flow grew by 8% to €240 million.
- Stock price decreased slightly by 0.16%.
- Continued investment in international infrastructure projects.
Company Performance
Sacyr SA demonstrated strong performance in the first quarter of 2025, driven by significant growth in its consolidated turnover and net profit. The company has maintained a stable financial position, with a slight increase in net debt that remains manageable. Sacyr’s focus on expanding its international footprint, particularly in infrastructure projects, continues to yield positive results.
Financial Highlights
- Revenue: €1,059 million, up 7% year-over-year.
- Net profit: €27 million, up 5% year-over-year.
- Operating cash flow: €240 million, up 8% year-over-year.
- EBITDA: €311 million.
- Recourse net debt to EBITDA ratio: 0.8.
Outlook & Guidance
Sacyr aims to secure four concessions per year, having already obtained two in 2025. The company plans to invest €300 million in equity for concessions this year while continuing to explore potential investments in Italy. Analysts maintain a strong bullish consensus on the stock, with price targets ranging from €4.21 to €5.06. Sacyr is committed to maintaining its recourse net debt ratio below 1.0, providing a stable financial foundation for future growth. For more detailed analysis and insights, check out the comprehensive research report available on InvestingPro.
Executive Commentary
Manuel Manrique, CEO, emphasized the company’s progress, stating, "We keep on advancing decidedly towards our objectives of growth in the constitutional sector." He also highlighted the company’s strategic focus, noting that over 90% of EBITDA comes from concessions with demand risk mitigation. CFO Carlos Michangos addressed the Colombian asset divestment, asserting, "We are not going to sell at any price. We are not in a hurry."
Risks and Challenges
- The slight increase in consolidated net debt could pose a risk if not managed effectively.
- The divestment of Colombian assets introduces potential uncertainty in the short term.
- Expansion into international markets may expose the company to geopolitical and economic risks.
- Maintaining the recourse net debt ratio below 1.0 requires disciplined financial management.
- Competition in the infrastructure sector remains intense, necessitating strategic agility.
Q&A
During the earnings call, analysts inquired about the potential divestment of Colombian assets, valued around €300 million. Sacyr’s management reiterated their strategic flexibility in asset sales, emphasizing that they are not in a rush to sell. Additionally, questions regarding the company’s investment plans in concessions were addressed, with Sacyr confirming a €300 million equity investment target for the year. Want to dive deeper into Sacyr’s financials and access exclusive insights? InvestingPro offers comprehensive analysis, including 6 key ProTips and over 30 financial metrics not covered in this article.
Full transcript - Sacyr SA (SCYR) Q1 2025:
Manuel Manrique, President and CEO, Sassir: morning. I’m Manuel Manrique, President and CEO of Sassir. With me as usual, we have Carlos Michangos, CFO of the company. Thank you very much for being here, analysts, media, investors for attending the presentation of the results of SACIR for the first quarter twenty twenty five. At SASE, we keep on advancing decidedly towards our objectives of growth in the constitutional sector.
During the first quarter twenty twenty five, cash generation has kept on growing solidly, and we have increased the pace of investment in assets, thanks to our success in tenders achieved in 2024 with new with five new concessional assets. All the key figures of the first quarter are behaving according to our focus that can be found in our strategic plan 2024, ’20 ’20 ’7, keeping recourse net debt in the low level that we committed to. Operative cash flow. Operating cash flow has increased by 8% and has gone up to €240,000,000 and concessions have reached €135,000,000 this year with a total of almost €2,000,000,000 of net invested capital. If you remember the dividends coming from concessions reach over €17,000,000,000 which is 6.5 times the market value of our company.
Consolidated turnover of the company has increased by 7% all the way up to €1,059,000,000 and net profit has increased by 5% up to 27,000,000 Most important milestone for the first quarter, the new contract that we have signed in Paroway to build and exploit for twenty eight years a network of motorways to increase the connectivity of the capital at Asuncion. With an investment that’s above €160,000,000 We started operating the Atacama Airport in Chile. Also the signature and commissioning of the Bruta Dell’Itata concession also in Chile with an investment of over €500,000,000 and estimated income of around €1,200,000,000 We well, only just a few days ago, we also signed a contract for the concession of the City of Health in Turin with an investment of €500,000,000 for twenty five years. Also, the divestment of the operations in Colombia that we hope will be closed in the next few weeks and a very important impact on improvement on corporate governance with proposals we will take to the next Annual General Meeting. Amongst these proposals that we’ll take to the next meeting general meeting, I would like to highlight a cash payment of a dividend as we committed in the previous investment day for 0.045 gross per share.
We will also propose a scrip dividend as we normally do. In January, we already executed the second dividend approved in the previous general meeting, in which 87% of our shareholders chose once again new SASEER shares. But besides that, the proposals that will be taken to the next general meeting include three new directors, one executive director and two independent directors, that will allow us to separate the functions of a Chairman and Chief Executive Officer and reach over 40% of gender diversity in the Board. After these appointments, 50 of the Board will be made up by independent directors. In sustainability, I am extremely happy to say that we keep on improving our positioning the best indexes and rankings, which show the commitment with the environment, society and good governance of all of our teams and projects.
In this slide that you can see on screen, you can see the main magnitudes I mentioned. The increase in revenues reached €1,059,000,000 EBITDA, $3.00 1,000,000,000 and net profit, 27,000,000,000. Operating cash flow is $214,000,000,000 And the operating cash flow EBITDA ratio is 80%. As we mentioned in previous Investor Day, operational our operating cash flow is the factor that best describes the evolution of our growth. In the first quarter, this operating cash flow has grown by 8% up to €240,000,000 The conversion factor of EBITDA and the cash flow is 80% in this quarter compared to 65% in the same period last year.
Over 90% of our EBITDA comes from concessions with demand risk mitigation mechanisms that can that are classified from an accounting perspective as financial assets. So EBITDA decreases the moment these assets are commissioned and put into operations, while cash flow increases progressively, which is the reason behind the evolution of EBITDA this quarter. To finish my intervention, I’d like to insist on the consistence of our growth and generation of operating cash flow in the investment in concessions and on the fact that we are meeting our commitments in corporate governance. Next, Carlos Michangu will provide more detail and specific data on the results of SASEER and each of the business lines. Thank you, Mr.
President. I’m next. We will analyze in detail the operating and financial performance of this quarter. We are going to start with the financial evolution. This quarter, we would like to highlight the investment effort made in our concessional business, mainly in the twenty twenty four tenders.
We have invested now €135,000,000 which is almost four times as much as in as the average of the past few years. So we have made an investment of over €1,900,000,000 total equity invested in our concession projects, which pushes growth. So we will be able to add and generate more value. In terms of the evolution of net debt, consolidated net debt is basically stable. It has grown just around €35,000,000 We must highlight the flow that we have generated, the cash flow generated, which is $220,000,000 and result has been €27,000,000 which is I would like to highlight here that we’ve also that’s also €19,000,000 below the previous quarter.
And net investment in our asset has been $2.00 €4,000,000 Financial results were €157,000,000 and DTO to reach 6,126 In terms of recourse net debt, it has increased by €130,000,000 which is basically the investments we have done in the equity of our assets. If we see the different components of the evolution of debt, we have generated €15,000,000 in operations. I would like to mention that, well, there’s a system ability linked to it. So working capital has a worse behavior. But in this case, the impact has been quite moderate at €70,000,000 Financial Express at 13,000,000 We have invested €140,000,000.135 euros in our regulatory and 5,000,000 in equipment.
We received €20,000,000 from the Barbantha divestment. We have paid 8,000,000 in cash for the scrip carried out in January and also adjustments due to ForEx and financing flow bring us to €266,000,000 We still commit with the ratio we committed to in the Investors Day. So recourse net debt divided by recourse EBITDA plus the distribution among the different projects is below one. And in fact, we are at 0.8 in the past twelve months. And if we take a look at growth opportunities that we have detected and the ones we are working on, we take a look at the world map from East West.
We can start in Australia. We’re walking around four water projects, big activity here. And with all sorts of plans, we are talking on desalinating plant, water treatment plant, in reuse plants and chew treatment plants. We have been prequalified in three of these tenders and the last one will probably be announced in the next few weeks. So the teams, the tender teams are already working on the offers and they’re getting ready for the different bets for these tenders.
In Italy, the Navarro Hospital, we they just opened the well, we’ve been approved. So we are just waiting for them to open the financial bet to be able to win that tender. The two sections of the A 4 Highway, which are Brescia, Padua and the one to Milan, where we expect the prequalification to be open before the summer. And in the A22 Highway, we’re getting all the documentation ready to be presented May 31. In Canada, we have been we are prequalified in the Ontario Science Museum.
And the prequalification of the Transcala Highway will be published shortly. It’s one section of the highway in the next few weeks. And the Windsor Hospital is suspected to be well, the prequalification is expected to be published in the second quarter this year. So technical teams and the tender teams are also working hard on these projects. If we go to The United States now, we have five highway projects that have been published or are going to be published.
That’s what we call Managed Lanes. In the I-two 28 in Georgia, the East Express Lane, we’ve been qualified. The West Express Lane is going to be published before the summer. In I-twenty 4, we already presented all the documentation two months ago, and it’s expected on the winners are expected or the shortlist, expected to be published in a matter of days or weeks. The I-seventy seven and the I-four 95 in North Carolina and Virginia, prequalification will probably be published in the next few months.
We’re also working on different opportunities in universities similar to the one to the control we’ve got in Idaho. And in Chile, we are working on a section of Route 5, the section that goes from Caldera to Antofagasta. It’s a private initiative that was presented by Satir some years ago. And we’ve got several water projects, desalinating plant of Cokingo presented in by the middle of the year, to reduce plants or going out of Kazan, other plant maintenance plants, both desalinating and water treatment plants. So a lot of work around water as well in the different countries.
So we are impressed in terms of business areas. The first one is Sassir Concessions. Well, revenues have been constant, drop off of €2,000,000 but we have to there’s a difference between construction income and operating income. Construction income increased by 88% with an increase and it goes up to €105,000,000 That’s due to the Belindre Hospital and the Bugabo Navintura Highway. However, operating income have decreased by 16% precisely due to the accounting impact of the evolution of financial assets that are in operation that the President just mentioned.
This brings us to a drop of EBITDA of 21%, and we reached €172,000,000 Most relevant data, we’ve got €135,000,000 that we have contributed to the equity invested, and that’s how we get to a total investment in equity of almost €1,800,000,000 Water not included and distribution from our concession to being €35,000,000 And the most important highlights, we’ve got this signing of the Ruta di Itakah and the Turin Hospital also starting operation of the Itakah Mayapur and with Vishal listed in the I-two 24 in Georgia. And we’re expecting for the next few days to be chosen as well or Vishal listed for the tenancy project as well. If we take a look at the Sassira Engineering and Infrastructures, an important growth, 24% increase in revenues. We also have two different types of activities. We’ve got Italian concession activity and it’s compulsory and it’s by Italian law.
It has to be included in construction. And it has gone from 94,000,000 to €164,000,000 basically due to the start of operations of the either one. So a start this year and there’s no comparison with the previous year. In terms of pure construction, an increase of 13% reaching €527,000,000 So activity both of work trial, consistent with other projects, especially in Chile, have kept a high level of execution. EBITDA reached €110,000,000 Italian construction went from 78,000,000 to €92,000,000 and construction 23,000,000 to 26,000,000 keeping a stable margin of 4.9%, which is the same one as the one we had in the last quarter last year.
And while the backlog is almost reaching €11,000,000,000 out of which 71% is for concessions. Important milestones, well, we got an award in Andalusia, the best public works due to the high speed train works we’re currently Algeria also the tunneling machine in Sao Paulo in the construction of the subway. And we are completed with on time and with the expected quality in terms of water, so the water, we can see that how the contracts won in 2024 can be seen in the results of the company, important growth, 11% growth in revenues and 13% in revenues and we have a good margin above 20%. We are already the first company in desalination capacity in operation in Spain and we supply over 16,000,000 inhabitants in those countries in which we’re present. The backlog is reaching almost €5,000,000 and total invested equity a bit above 120,000,000 Main milestones of this quarter, we won new contracts like the Inbarra Hoffa the first contract in Catalonia, which is Traynichen and was well treatment in Tolvera or the renovation of the Victoria sewer system.
And we are also working to transform the well, the sludge generator in one of those water in Chile into fertilizer, promoting environmental sustainability and secure economy. So conclusions of this quarter, solid cash flow generation of 8% higher than the previous quarter. We’re still boosting concessional growth with higher investment in the quarter. And so we’re adding value. We continue with the sale process of the Colombian assets.
And we are also we also made our commitment to the recourse net debt ratio below one. And having said that, Mr. Christian, you’ve got the floor. And now we are open to your the questions from the analysts. Good morning, everybody.
Next, we will start the Q and A session. As usual, we will start with the questions that we get from the phone and then the questions asked through the chat. First question, Miguel Gonzalez from JB Capital. Please, Miguel, go ahead. Yes.
Good morning and thank you. I have three questions. First is on the divestment in Colombia. I guess, there isn’t much you can mention, but we’ve seen in the press that you were negotiating with Actis for your stake in the forward concessions. I’m not going to ask you to confirm those piece of news, but I just wanted to know if do you see there are there are uphelding offers to sell your participation instead of 49% and as it was mentioned before?
And if you can please update your internal valuation of these highways. Then my second question is about the evolution of recalls net debt, 26,000,000 of a lease and ForEx and investment flow compared to the 5,000,000 negative euros you had last year. So I just wanted to know if you can explain what’s behind this change. And then a dividend payment to shareholders, you’re going to take to the Annual General Meeting that dividend, but also another scrip dividend. So it’s going to be a cash dividend and scrip dividend.
So I would like to know how the dividend structure is going to be like, if you’re going to blend cash and scrip? Or is it going to be just cash? Or if there can be a buyback of shares into that scrip? So if it will be great if you can clarify anything about it. Thank you very much.
Well, Miguel, just give it a second and we’ll answer. Thank you. Yes. Well, first question, the divestment in Colombia, as you mentioned, please let us we’ve already mentioned that we expect that to be closed in the next few weeks. But of course, in this type of process, well, discretion is important.
We shouldn’t say anything. Internal valuation that we already mentioned in the Investor Day is around €300,000,000 We have always mentioned and we are happy to say it again, that we that at any time we sell, we will do so in conditions that are good for us at the year. We are not going to sell at any price. So if we do, well, conditions must be right. We are not in a hurry.
We don’t need it, but we expect to do so in the next few weeks. Yes. On the second question, there’s a bit of a higher impact of leasing in well this quarter compared to the previous year and also some other financing that we’ve done on the equity, but just those adjustments, but figures are quite small. In terms of shareholders, we as we mentioned in our shareholder remuneration, well, we’re still having our first dividend payment in cash. And in case it’s needed, we’re also going to take to the Annual General Meeting the possibility of having a scrip dividend as well.
Both dividends that we normally propose is actually the Board, the one who decides how to do it. We mentioned that and we want to meet that in 2024, ’20 ’20 ’7, we will be paying around €225,000,000 That’s what we’ll do. Next question comes from Luis Prieto. Please, Luis, go ahead. Yes, good morning.
Thank you very much. And I had three questions. First, if you could please clarify the status of the negotiation with on the Montana project. Second, the right window to launch of Boreantes, take into account third parties and your sales in Colombia. And third one, it’s a matter of curiosity.
We have seen some progress in the construction and operations of airports and Ferrovialis and JFK. So there’s been some noise about a possible concession of Mok Terminal B. And I’d like I’d just like to know if that is a segment and a type of asset that could be interesting for Sassir. Thank you very much, Luis. Just give us a second, and we will answer.
Good morning, Luis. First, in Pre Montana, we are in the normal process of any concession. We come forward with frequent meetings, And this is what’s normally done in any concession, additional investment to rebalance it immediately. And second, you mentioned timing of Boreantes. As you said, there’s a similar process.
The same company of funds could be interested, same process, same process as the one in Colombia. We’re still working on it, and the pace is normal. And timing is normal and what could be expected. We’ve always mentioned that this couldn’t be forecasted by the early twenty twenty six or the sooner end of twenty twenty five, and that’s still the scenario. And the last question about airports in The United States, we are not in that business today, but that means nothing because we have many infrastructure concessions.
And for the moment being, it’s not in our radar. Thank you very much. The next question comes from Alvaro Alente from Alantra. Please, Alvaro, go ahead. Thank you.
Just a fast question about the evolution of your working capital. Last year, most of your construction portfolio was in concessions. And last year, we saw a lot of use of working capital for third parties. So I know the first quarter is the one in which you use most of the working capital, but you can give us some guideline on what that should figure be by the end of the year. Well, Alvaro, as you’ve seen, the impact of this quarter has been quite moderate.
So we expect a recovery in the next quarters. And we already mentioned last year, last year, we did have a bigger impact. But basically, because we had reduced our construction activity. This year, it’s more stable over 70% working for our concession already for our concessions. And this is just due to the seasonal nature.
No more questions from the phone and we can now start with the questions from the webcast. First one comes from Philippe Leide from CaixaBank. Philippe, you were asking about the financial rebalance of Rimontana that’s been answered already from for the I-ten. The status of the project and when you expect to start the construction. And then, recourse net debt, when we expect to invest in equity and concessions for this year?
And what the recourse net debt figure should be at by the end of the year? Thank you. And we’ll answer. Give us a second. Yes.
In terms of the I-ten, we are following on the expected timing. We have provided them well, the signs. That’s what you need to do. And we start construction to start first quarter twenty twenty six, but according to the initial forecast. In terms of well, we had expected to invest $380,000,000 3 80 million euros but the timing of on the contract signed, well, means that this year, we’ll probably invest around €300,000,000 and 80,000,000 or €90,000,000 will go to 2026.
And in terms of the evolution of recourse net debt, well, there are so many factors involved, such as the divestment of Colombia or the eleventh of the year. I mean, it’s just too soon. But what’s actually important is to highlight that we are we will like to keep our ratio that things can move due to seasonal aspects, but the recourse net debt ratio and because net debt will is going to be kept under control. Next question is from Julius Nicholson from Bank of America. He was asking about the process in Colombia.
I believe that’s the person already answered. And if we could give him some figures of how much these assets could contribute to EBITDA and cash flow. He’s asking just in case our targets or the targets provided in the Investor Day are going to be kept. It is also true, and Julius, I would like to remind you that we have won several projects that were not included. But well, I will answer in just a second.
Well, the weight of Colombia in the company is relevant. And of course, the objectives we provided at Investors Day, we all mentioned that was without the divestments. If these divestments actually happen, we will need to adapt the objectives to the new reality of the company. And given that we have been quite successful in the tenders last year, our focus is to update the valuation of assets probably in July in the presentation of results of the first half of the year to give some clues to the market on what these relevant aspects are. Next question is asked by Miguel here.
Had to do with the Brabanca divestment. You mentioned that was you mentioned €20,000,000 So how if that was fitting our internal valuation? And on CapEx and operating cash flow, Carlos already mentioned, which is the equity that’s going to be invested and how that’s going to be distributed. Well, terms of our bonds, it’s exactly 2% of what we had in the Investor Day valuations. It’s perfectly well aligned with our forecast.
We already told the markets that we are I mean, we are we try to be careful with our valuations. But in this case, they tend to be above. No more questions from the webcast, but there’s one more from on the phone. So Fernando from Alantra. Please go ahead.
Hello. How are you? Good morning and thank you for allowing me to ask this last question. I had more of a general question, understanding that Colombia Colombia looks well and could work and the cash improvement you have forecasted for the end of the year. In the concession pipeline, is there any other alternative that you could invest in organically, not inorganically?
But any possible tender, any yellow feed, any that could make the investment in concessions to accelerate in the next twelve to eighteen months compared to the plan you’ve got today? Or would it be or are all the new projects going to be we have a different equity, but in the midterm. I just wanted to understand how you see that and how sure you are about the fact that you about, well, the pace you have with winning concessions in the past few months, if you think you’re going to be able to keep that up. Thank you. Yes, Fernando.
Well, a question that’s a bit general, as you mentioned. But we do have possibilities to increase investments in Italy, in the projects in Italy. Those are the projects that we are just starting. In terms of growth, we are just as excited, and we have the same objective as the one we mentioned in the twenty twenty four, twenty seven period. Four concessions a year, I mean, last year, had five and this year, we already have two.
Next question is Luis Brito from Kepler. Please, Luis, go ahead. Yes. Excuse me. But should we expect SASEER to be in all the shortlist in the five projects you’ve got in the presentation?
Yes, give us a second and we’ll answer. Yes, Luis. We well, Anthem, we go to tender. Our objective is to be shortlisted. Otherwise, it’s just a waste of money.
And of course, we aspire to all of them. I don’t know if that’s answering all your question, but yes, clearly, yes. No more questions. And I will now like to give the floor to the President, the Chairman. If there are no more questions, we’d like to thank you for your attendance and your interest, and we hope to see you next time.
Have a good day. Thank you very much.
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