Good afternoon and thank you for joining us in this Q1 results presentation. We will briefly analyze the key aspects of our results, which have been recently released and then we look forward to any questions you might have. As you all know, COVID-nineteen has had this impact across the world, affecting our health, our behaviors and global businesses and economies. In this situation, ACS's operations have shown good resilience In practically all business areas except for Abertis, in this Q1 2021, the recovery trend continues, especially in the meeting process where we see more activity and we will detail later on. To analyze the Q1 2021, We are referring growth rates to the 2020 pro form a figures where we have reclassified Industrial Services at discontinued operation after the recent agreement with Vansi.
Also we have adjusted contribution from TIS accounting only the current 50% stake as a fully method in both years. At the operating level, sales decreased by 10.6% to €6,400,000,000 affected by currency headwinds, especially the U. S. Dollar that has depreciated by 9% versus the euro. FX adjusted sales went down by 7.5%.
The backlog stood at EUR 63,000,000,000 growing 3.1% supported by a strong recovery of orders intake. EBITDA reached €329,000,000 declining 4.3% and improving its operating margin in America and Australia. Excluding Abertis contribution, It decreased by only 1.2%. EBIT decreased by 7.9% and reached 205,000,000 The group's net profit reached €195,000,000 Not considering Abertis, it would have been 8.5% higher than in 2020 comparable period. As of March 31, 2021, the group had $3,700,000,000 of net debt, €1,300,000 higher than a year ago, the significant reduction of factoring of more than €800,000,000 and €662,000,000 Casual clarification for International Services visit as has the held for sale explain this increase.
Our business strategy has focused on strengthening our presence in main regions where we operate, maintaining a balanced distribution of activity. Currently, 90% of our sales come from our main three markets, cities developed from North America, This is the U. S. And Canada, over 19% from Australia and 11% from Spain. The remaining 10% came from Germany, 3%, The rest of Europe another 3% and Asia and South America will represent less than 4% of the overall sales.
Continuing with Q1 performance, South American market reached $3,800,000,000 sales. The significant FX impact from the dollar depreciation plus the slowdown of the activity compared to a strong Q1 of 2020, not yet affected by the COVID-nineteen, explained the year on year sales decrease. Actually, current sales are 3% higher in the Q1 of 2019 level. In Australia, Total output remained stable in local currency, while Spain had a sales slightly decrease of 1.2% coming from construction activities, which could not be entirely offset by the increasing facility management. In construction, Sales reached €5,900,000,000 with an EBITDA of €213,000,000 Margin over sales increased by 30 basis points versus Q1 2020, thanks to an improved operating efficiency in North America and Australia.
Meanwhile, in concessions, EBITDA dropped to negative €2,000,000 from €0.13 in the previous year, driven by average contribution, We were still affected by traffic restrictions due to COVID-nineteen. Finally, services, where sales recovered after the end of lockdown in 20 Likewise, operating margins returned to regular levels pre COVID. Net profit by activities. Construction net profit gradually unchanged amounted to 73,000,000 Consensual net profit was a negative €4,000,000 following the €9,000,000 reduction in Abertis contribution. Industrial services reached €110,000,000 8% lower than previous year due to the impact of the pandemic and a €7,000,000 contribution from services regarding from COVID impact plus positive results from corporation due to the non ordinary financial results, which last year contributed negatively.
Overall, the group's reported net profit as of March 2020 amounted to €195,000,000 3.8 percent higher year on year. Let's summarize Abertis performance in the Q1. Traffic was still affected by mobility restrictions, but benefiting from a very diversified portfolio. You can see traffic evolution by country in this slide. Traffic recovery is expected Due to COVID, our relapse for the next month.
CWS operating revenues went up by 2% And EBITDA up by 6% mainly due to the full consolidation of RCO in Mexico and Elizabeth River Crossing in Virginia recently acquired. The inclusion of the new asset strengthened Aversi's growth platform in North America and facilitate the analysis of future opportunities. Moreover, Abertis continues to explore new investment opportunities in the brownfield projects to diversify its continued portfolio and sources of revenue. Meanwhile, diversification profit per PPA amounted to 84 €1,000,000 for the 1st 3 months, a reduction of 29% driving average profit contribution to ACS net profit to 96,000,000 In addition, last April, Navarithis proceeded with a dividend payment of €300,000,000 Buyback evolution. Let's move to the buyback evolution.
As of March 2020, working cash remained robust at €63,000,000 3.1 percent higher than the previous year. By core countries, we sum up over 80% of the backlog. The U. S. Backlog grew by 7.4 percent, FX adjusted, up to €28,000,000,000 Australia's 1 Estrada touched EUR 18,300,000,000 4.8 percent like for like and Spain reached nearly EUR 5,000,000,000 with a slight decrease of 1%.
This positive evolution is backed by strong order intake during the Q1 of the year over €7,700,000 equivalent to a book to bill ratio of 1:0:7. Furthermore, we have a positive outlook base on a single plant and green deal agreement as part of a crisis response from government. Some of them have been already announced, but current project pipeline including infra PV provide us confidence for the future. Major recent awards include a high voltage transmission network in Queensland for over €1,000,000,000 a 10 year operational maintenance contract And by road work in the U. S.
Amounted to over 500,000,000. As March 2021, the ASI Group reported a net debt balance of €3,700,000 This figure is €1,900,000 higher that the net debt reported at year end 2020 as a consequence of the seasonality effect of the period, which implies the same cash outflow from the operating Working capital variation of approximately €1,000,000 in line with previous years, driving net income from operations to negative €769,000,000 The reduction in the factoring balance in the last 3 months, €269,000,000 under the regular classification of industrial businesses Cash of €662,000,000 at discontinued operations after the agreement with VANSI at the end of March 2021. Just to finish, I would like to highlight that the group's Q1 results have confirmed the resilience of our businesses, backed by a solid decision to focus in the most developed markets. Obviously, as the blackout period caused by the special situation provoked by the pandemic, The order intake has included recover in these core markets, providing more visibility in our outlook for the coming quarters. As our Chairman mentioned in our recent EMEA, the recovery must clearly reflect Adaveras.
After the year of trending global mobility restrictions 2021, we are seeing an uptick in traffic on highways. And while the trend is confirmed, we expect the increase in their profitability going forward. This evolution, together with the robust performance shown by the rest of our business, make us confident the 2021 results. Looking to the future, we believe that our capacity to create value must target those sectors and activities where our extensive experience and resources can be most efficient and also can help to achieve our sustainability goals. In short, We are focusing our efforts in the areas of construction and concession where we foresee good opportunities to achieve the profitable growth targets we have.
Thank you very much. And we are now ready to take any questions you may have.
Ladies and gentlemen, the Q and A session starts now. The first question comes from Luis Prieto from Kepler. Please go ahead.
Good evening. Luis It's Pietro here. I had a couple of questions, if I may. The first one is, in the AGM, I understand It's fair and commented on a plan B of Atlanta shareholders or the Italian government decided against the ACS's move on ASPE. I know it's difficult and it's probably too early, but if you could shed a bit of light on what these Plan B, C or whatever I could entail.
That would be extremely useful. Or at least give us a hint in what direction you're looking at. And the second question It's regarding Industrial Services. What's left consolidated there at the EBITDA level? I understand it's just the energy assets That you have kept and you reported an EBITDA of €11,000,000 Is it fair to assume that you're going to end the year with an EBITDA from these assets in the ballpark of Sort of €40,000,000 €50,000,000 or am I missing something?
Or is there any distortion embedded in this number? Thank you.
[SPEAKER CARLOS GOMES DA SILVA:] Yes. To answer the first question, I guess, We manifested and we are interested in looking to the possibility to invest in Asti with the idea of consolidating a new platform between Assi and Abertis, which will become within one of the leader concession operators in Europe, if not in the world. We will have a very diversified geographical footprint and ambitions to make it grow. But obviously, This is something that obviously we need to be at any time you work for a concession, you need to be in agreement with a concession renter, in this case with the Italian government. And we manage the territory.
We are looking into the data room and we have to wait to see what movement are the concession renters making. We are ready to meet, but obviously, they've got already not presented, which is being discussed. And depending upon how we will perceive our offer, we'll proceed or more aggressively or less. It is obvious that we would never act in a situation where we would not be in a friendly atmosphere to the Italian investor or to the government. So we have to see what is their idea of how do they want to privatize the company.
For us, it's an interesting asset. But if for whatever reason, they prefer to keep the present situation, we have quite a few other alternatives. The plan B that you mentioned is not a plan B. I mean, it's quite a lot of concessions being developed both in America, in Australia and in Europe and also new greenfield operations and also existing brownfield operations that I'll be offering in the market. We want, as we said, to focus on the concession operation as well as having the construction arm to be able to convert greenfield into existing operation and make the platform grow, which is I think the advantage that a company such as ours would bring to a concession operator have the capacity to keep the growth by incorporating new concessions coming from the Greenfield estate.
But it's not a plan B. This is something which is going to happen Almost regardless, if we were able to invest in ASPI in attractive conditions, obviously, We will spend more of a 5 hour into the transaction. Otherwise, we'll spend the investment capacity in other concessions.
[SPEAKER MARTIN PEREZ DE
SOLAY:] And then the second question? [SPEAKER MARTIN PEREZ DE SOLAY:] Yes.
It's about the energy assets that are contributing to
the dividend. [SPEAKER MARTIN
PEREZ DE SOLAY:] No. Energy assets, I wouldn't be able to tell you whether this 11% is going to be 4% to 4%, because some of these assets are being marketed. It was from the very beginning. Some were being pursued by some individual investors, specific concession in a small market, which we might sell. So I would not be able to tell you whether we'll keep the full amount than we have now at the end of the year.
Some we might be able to sell. [SPEAKER JOSE
HUMBERTO ACOSTA
MARTIN:] And also there are some that are under construction that could start at the 2nd part of the year. So it's now it's not very easy to forecast what is going to be the EBITDA for full year.
Okay.
Okay. And then, Angel, if I may have a follow-up question regarding the alternatives potential investments. Would you Would you invest in those directly, the proceeds from the VINCI transaction? Or through Abertis in a combined way, is there any light you can shed in terms of what structures we could think about?
Obviously, Abertis is a very good platform. Abertis It's a problem where we have another partner Atlantia. So we don't have any problem in investing through Abertis if the other partner is willing to follow a growth strategy, but that doesn't limit us. If the other partner were not to be willing to invest on Boeing to agree on Boeing investments, we will direct it to Ilidio Marcel. So we have the capacity to invest alongside or solo.
Okay. That makes a lot of sense. Thank you.
Thank you.
Thank Thank you. The next question comes from Fernando La Fuente from Alantra Equities. Please go ahead.
Hello. Good afternoon. Two questions for well, 3 for me, please. The first one is on the outlook of net profit and following the comments made by the Chairman in the AGM. And if you could give us an answer a little bit of well, actually, what are your views regarding the evolution of net profit for this year?
And also assuming that well, adjusting the net debt with the changes in the perimeter and also T4, the proceeds from COBRA, what are your best expectations for this year for net debt? The second question is on investments. I've seen that you have reduced significantly the investments in renewals. I understand that This is it, no, in the sense that you are not investing in renewables going forward and you will be waiting For the new JV to acquire these assets, no? Looking to the next quarters, the following quarters.
And lastly, on Atlantia, I was wondering if you could give us kind of a view of on the timings. I understand that The Atlantia will hold its AGM by the end of the month. So what are your alternatives here? Can you If you decide at the end to make an offer, can you do it before this AGM or you have to wait after the AGM? What are the time is there or your views there?
Thank you so much.
The first one is a very easy one, What is my outlook for profit? I think about 10 days ago, the Chairman announced in the AEM that the concession Environment was to be positive and we could get close to 30%. I'm not going to change is the slide. So basically, I think we are all considering that if Abertis goes in the line that everybody expects, we could get to this amount. Obviously, it is something which is completely beyond our control because As you saw about a month ago, the French market suddenly put again restrictions on mobility, But hopefully, that is was something very temporary and even now is in a way.
So it depends very much on our the other businesses are pretty much resilient. I think there was a slowdown in order intakes in the latter part of the year, which has been in the Q1 being significantly recuperated. So we are very positive in the regular business And we are completely on the head of the pandemic effects for the total businesses. In the case of net debt, I mean, it's very difficult to say what is going to be our net debt scenario because First of all, we hope to get the $5,000,000,000 we expect from the Cielo Pan 3, which hopefully will be the year. But obviously, the amount which is going to remain on hand depends on the investment how fast, how big the investment will be.
So I guess whatever I tell you is get work. Basically, we have a pressure situation which is affected by And the effect of the Q1, which obviously we have a negative Q1 in terms of working capital when we would basically begin to ease off throughout the year. But the rest it depends the investment how fast today go and how big. In terms of renewal, you said that we are slowing down renewal. Again, With now, we are not investing in renewables in the sense that the renewal development is something that does COBRA, which basically is a this continued operation.
COBRA is continuing with its own activities of development as fast as it was before. The only thing is obviously it is something which will mean on behalf of the potential owner. We do not consolidate at EBITDA level on consolidated net income, but they continue with the same progress. The investment that we hope to do is this if the transaction is complete as we expect the VASI transaction, we have a company which is perceived to be 51%, 49% through which we will invest. And obviously, to this new company assets being developed by the company these 25 gigas in first pipeline pursued by COBRA and even some of the EBITDA we might have.
So Basically, initially our investment would go the normal ways to do through the joint company with Vasi. But new developments are being done by COBRA itself without any reduction in the And then Atlanta. In Atlanta, I guess, a little else I can tell you. Basically what we've said is that we're interested in the asset. We think the asset fits very well with our target of being invested in concession.
2nd, we think it is a good combination Abertis and Amazpi for the Italian shareholders. It provides the joint company with a much bigger geographical footprint In diversified different markets, the problem with ASPI is that it is restricted to the Italian environment, which is obviously in a situation where You've got different type of risk to have concentrated the single market. It's more risky than to have a presence in North America, South America I know it's in Europe, U. K. And Germany and Spain and even Australia.
If you adapt to the equation, you get a stronger company. But obviously, it depends very much on what is the attitude of the President in Russia and the Italian government. I guess we're never going to get into a situation where we will dispute bitterly the existing pillars because obviously You get there the CDP, which is a state owned savings bank, which obviously would not make sense to actually fight their bid with them. But it might be different possible combinations And we are basically waiting to see what responses do we get and also while we're doing the analysis in the in the last round. But it's little else I can tell you for the time being.
Obviously, by the end of the month, we will have a much clearer picture where we will go.
Thank you so much.
Thank you. The next question comes from Alejandro Vigil From BEST INVERSE Securities. Please go ahead.
Hello, Angel, Luis. Thank you for opportunity of making these questions. The first one is regarding the renewals that you mentioned with Huifansea. I know it's early days, but if you can give us some color about what Kind of framework of investment are you wanting to develop with them if you are setting some kind of profitability criteria In terms of total investment in the projects, if you can give us some color about this joint venture. And the second question is about Abertis, the plan B, if Asti doesn't go ahead.
It's which are the key markets for investment opportunities for Abertis? Is it more the U. S. Market or is it more Latin America, if you can give us some color about the key markets for the company. And finally, about the capital gains from From the transaction of Industrial Services, where are you thinking about these capital gains?
To just to report then or to use part of these capital gains for Cleaning the balance sheet or your thoughts about that because I mean the plus 30% guidance Of the Chairman in the shareholder meeting doesn't include this kind of capital gains? Thank you.
Of course, Laurent. Yes, let me start by answering you the last one. We plan to report the capital gain that we We do not plan to hide it under the carpet. It's basically whatever the capital gains will be We'll be out of the regular budget, so to speak. I think the Chairman implied what is The objective of regular business is the size of this capital gain will be in the million category.
Obviously, it's not incorporated here. Whatever we make at a Capelian, we have to report it and invest most of it, if not all, into new businesses along the lines of what we do like. We said Concession transportation concession mostly the regulatory consumer businesses and not everywhere but in developed markets. Basically We consider that this type of investment we feel more comfortable making them in market where you got a strong currency that you do not have tremendous fluctuation where you've got a stable legal framework where investors are willing to buy without a specific cycle concern. So North America and Europe and Australia in principle of the preferred market.
That does not imply that we could not invest in an asset that I believe is both In RCO in Mexico, it appeared to be a good opportunity and it was done. But the focus is not to concentrate in those markets, but rather in the developed markets. And in terms of the Removial joint venture, I guess The framework is very simple. Our company, COBRA, is developing quite a lot of renewable assets that were shooting on a pipeline of 25 giga. And once these assets are really built, You can bill them for clients, but these are the ones which cover in development.
So the idea was to have the ability to invest In the joint vehicle with Vaxi, Vaxi wants to consolidate their environment, they will have 51% and we will have 49%. But the idea is to do a co investment with them. I guess when you say what IR target we get that very much is does not depend on ourselves. It depends on the market. Obviously, you're not going to set there are targets for a vision which we will deal 2 or 3 years later on.
But obviously, there have to be targets which are attractive for the market. The volatility of these projects are really below. And depending on the technology and the capacity to generate sustainable cash flow, this is the reason why we think it is worthwhile to invest. And We shared value with Vasi and the idea is as we develop them keep on putting them and we have the right to invest not the obligation on a price to price basis. But the idea is that we will go and put our ships together in an investment which will provide significant dividend going forward.
Thank you very much. The next question comes from Toal Zafara from Banco Santander. Please go ahead.
Yes. Hi, good afternoon. Just a very simple question. Sorry, if I didn't understand. If I look at your cash flow statement, I mean, it's mentioned that this includes The Industrial Services Unit.
So all of it are so working capital, This all includes the still the Industrial Services business. But then you do the adjustment in terms of the cash position of this Industrial service business in the debt. So I was just wondering, I mean, if I'm looking at it correctly or not?
In the debt position, when we speak about the debt, obviously, we have all the assets which were incorporated in Industrial Services. When you put them as an asset held for sale, after discontinued operation, you put them in the line. So you eliminate these assets from the cash or the debt situation. You eliminate both, the cash and the debt. Since the industrial asset was A debt free was a cash rich company had about €700,000,000 or €600,000,000 plus €1,000,000 You eliminate that from the cash.
While we were keeping the Green Bond asset liability because this is not In the asset that we're selling is in the holding company which we keep. So this is basically the reason why it appears like a reduction in the cash so it is a reduction in the cash only being reported.
Yes. But Joao, yes, you're right that the cash [SPEAKER JOSE RAFAEL FERNANDEZ:] Flow statement includes the cash flow from continued operations and discontinued operations. So both are included in the cash flow statement, okay?
So what is the cash flow? Yes.
Yes. No, no. I was just Trying to understand where the so my understanding is then that the cash flow that is generated includes the Industrial Services business? Yes. And then you do the adjustment for the quarter end cash at the Industrial Services?
And as you know, all the businesses in the Q1 have this seasonality effect. So the cash flow operating cash flow always It's a little negative.
No. Yes, I understand. No, I just said about because of a previous question, it was mentioned that in terms of the investments that That were being done. And is this in the end I mean, being industrial services business here, It's true that the investments done in the quarter were very low. So I'm sorry, I got a bit lost in When you answered that because I understood that it wasn't included, but okay.
Yes. But also if you have in the results Report, you have the breakdown of the investments and you can see that there's investments in renewables and divestments as Well, in the
in renewables.
That's why
the end is slow
to 0, but it's But you have 80 minuteus
80. Exactly. So we have had
Okay. Thank you.
Thank There are no further questions. The speakers back to you for the conclusion.
Okay. Well, if you don't have any more questions, thank you very much for attending the presentation. You know we are available. If after going a bit more in detail through the results. We want to get further clarification.
I apologize for having had so little time from the results presentation until this meeting, But we wanted to get this today because tomorrow is a semi holiday in Madrid and we wanted to get the information as soon as possible. So thank you very much and wait any further call you want to make us. Thank you.