Good afternoon, and welcome to the disclosure of Dominion.
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Well, Well, before starting, I would like to remind you that once we finish the presentation, as usual, we will open the floor for your questions. And you can either send your questions in writing, or you can either call us on the telephone or raise your hand to speak. And we're going to start with Rolita Tobias, who is the Director of Corporate and Patrick Berghon, who is the Director of Corporate Development. Good afternoon, everybody, and many thanks for attending this results disclosure of Q3 in 2025. We are facing a quarter without major changes relative to what we'd already seen in the rest of the year.
In other words, business as usual with positive evolution in spite of the context and in spite of the geopolitical situation where uncertainty is the dominating factor. We are fully aware of the fact and although we don't have many direct impacts, I'd say that the main effects for us are, on the one hand, the strong depreciation of the dollar during the year and on the other, the slowing down of the project segment, which is fully compensated by the recurrent businesses of GDE and services. And as a summary of what we're going to be looking into for the first nine months of the year, we can underscore that we've had organic growth of sales that is far above the guidance and reaches 9% in constant currency. And we believe that we shouldn't forget that we have carried out significant divestments that have eliminated more EUR 110,000,000 from our invoicing. And this simplification process is continuing together with the divestment in The Dominican Republic, and it can be seen in the increase in consolidation of our profitability above 13% and reaching our EBITDA margin over sales of 13.3%.
But to this together with this transformation process, we're also boosting our strategic area of the global Dominion environment with acquisitions, that is three companies in the quarter, two of them in Spain and one in Germany, in order to gain a position in the different industrial poles and increase our infrastructures and capabilities in this kind of activity. And finally, and as we've already mentioned, the net profits have been strongly affected by the depreciation of the dollar, which has produced a correction of the divested assets in The Dominican Republic. Without this correction, the net profit would be 40% higher compared to the figure of 2024. But now I'm going to move on to the details. But before doing so, I would like to remind you once again that the figures for 2024 were pro form a to be able to compare identical parameters after divestments of to 2024 and which mainly refer to the sale of industrial maintenance services to Ceraveo.
And let's say that this pro form a had has an impact on divested activities of about €140,000,000 in terms of invoicing or turnover, euros 5,600,000.0 in EBITDA and 4,300,000.0 in terms of net profit. And as with this pro form a figure that has the same perimeter with which we're going to compare the results of these nine months. And the business figure reaches EUR 800,000,000 and represents organic growth at constant currency of plus 9%, in line with what we said in the previous quarter and practically doubling the commitment established in the strategic plan, and you know that it's 5%. And this growth has been boosted by new contracts throughout the year, mainly in services that are recurrent and therefore have been maintained month after month and give us visibility and also have provided good future growth possibilities. But the inorganic growth has subtracted 13% and the Forex effect has been negative by minus 2%.
Margins, we've already mentioned at the beginning of the presentation, are consolidated above 13%. And this shows the end result of the simplification strategy covered by the plan, and we've also focused on activities and businesses that are more profitable that are associated with the environment and which increase the potential expansion of margins, which we expect will progressively increase in the future. And with it, in these nine months, we have an EBITDA of 13.3% over sales, and that is a growth of 6% in absolute terms. But below EBITDA, it's important to mention several things. On the one hand, the reduction of financial expenses continues as we already saw in previous quarters.
And this is the end result of the reduction of interest rates by different central banks. And this effect has produced a reduction 25% of financial expenses roughly, which is equivalent to something like EUR 7,000,000 in the first nine months of the year. It's expected that this effect will continue in subsequent quarters, and the company will progressively reduce its net financial debt as a consequence of divesting in renewable infrastructures. And interrupted operations, we've only included the wind farm, Serritos, has also reduced its financial expenses significantly. And the new development in this quarter is that the farm is in operation and is therefore is producing energy in the test revenues model.
And as a consequence, and apart from this income, the park or the wind farm has operating expenses. And finally, there are several one off effects that are associated with the divestment in the PV assets in The Dominican Republic with a total of EUR 16,000,000 in nine months. We have the correction that we mentioned in the semester's results, which is associated with the depreciation of the US dollar and which doesn't represent any problems in cash flow. And the attributable net profit reaches $6,100,000 And without taking into account those one off effects, it would be $22,000,000 In other words, the recurrent net profit is 40% higher compared to the net profit that we reported in the nine pro form a months of 2024. Let us now look into how each one of these businesses has evolved to establish these global figures.
We would talk about global dominion environment with a turnover of $332,000,000 and growing organically 8.3 compared to the same period of the previous fiscal year. It's the segment in which we have the biggest impact of the currency because Forex subtracts 2.8%, and the area has a contribution margin of 11.9%, which means that the margin of the segment is growing at two digits. Vis a vis that 8% of growth in turnover, the margin grows by 11%. So GDE accounts for 41% of the total level of turnover and one third of the total margin of the company. As we've already mentioned, this segment is going to focus on the inorganic growth and expansion CapEx.
And during Q3, we validated this strategic approach by announcing the acquisition of three companies. We have UREC, that is the water recovery unit of Cartagena. This is a plant for the processing of industrial water and a transfer center in the province of Murcia. The operation has brought about the acquisition of assets, and it will be fully operational as from 2026. And in Spain, we have EcoHestion Perrecivios, which is a company that manages and transfers industrial waste, and it's located in the province of Calif.
Both companies are going to join the businesses of the circular economy, and this allows us to have more geographic presence in the main industrial centers in the South Of Spain. And we also have different operational synergies together with the rest of the infrastructures and activities already underway in those areas. And thirdly, the German company, Zublin Chimney and Refractory, specialized in industrial deep carbonization and which was our main competitor in this segment in the country. Well, this company has a very solid client portfolio. And now we have become leaders in the German market, and we have become a reference in the Central European market.
And we are also collecting all of the operational synergies after integrating both companies. We consider that we are facing an atomized market in the area of the environment and that we can achieve a significant buildup in Europe. So that's why we're analyzing operations that can provide Dominion with new capabilities and a solid position. And progress is being made in developing several greenfields, both in Spain as well as in the Persian Gulf. And as regards organic development, it has to be pointed out that we are continuing with the internationalization of certain circular economy activities in the previous quarter.
We spoke about our first recovery and revaluation operation in Latin America. And in Q3, we've extended the radius, now we're starting to work in Chile. And we have also con continued with very good actions in terms of decarbonization as we're providing advanced engineering services, optimization and maintain maintenance and integral revamping of different kinds of furnaces and in different locations. Now Glovan, Dominion Tech Energy. Well, here, we are addressing the energy and digital transitions, and this has been divided into GDD services and GDD projects.
GDT services closes the first nine months of the fiscal year with a business figure of €374,000,000, which means that there's been a growth of 13% in turnover compared to the same period of the previous year. It's the segment that has grown most, and its characteristic recurrence gives us lots of visibility in terms of future turnover. And we can confirm the strength that we've seen during the entire year when more operation and maintenance services were higher for telecommunications, infrastructures, and electrical infrastructures in Latin America. The contribution margin stands at 17.9% over sales with a growth in absolute terms of 8%. As regards to the total of the company, GDT Services accounts for 47% of the total sales and 53% of the contribution margin.
And finally, GDT project or projects closes these first nine months with a business figure that is practically to the one reported one year ago. There's a slight reduction of 3%. And this practically flat behavior has its origin, and that slowdown that I already mentioned as regards project execution, which is the consequence of the geopolitical uncertainty we're currently facing. And it's also the end result of a greater financial discipline imposed on renewable projects where we don't execute anything until we incorporate a financial partner. And in this regard, we have Q2 with more executions, and we were carrying out the Italian projects.
And now that this has reached its final stages, we have a third quarter with less turnover. It's important to say that this slowdown does not represent any losses in terms of projects, but rather temporal delay. So this is why the portfolio now stands at 426,000,000. And during q three, we can underscore a new project for technological integration for the National Authority of Infrastructures in Peru. And the project is about engineering, installation, configuration and implementation of weather radars, weather stations, and early alarm systems in the regions of ICA and Pira.
And to finish with the projects, the contribution margin now reaches 22% over sales. In other words, these are levels that are much higher than the floor that have been established for this segment. And as regards the company itself, GTT projects accounts for 12 of the total sales and 16% of the contribution margin when the end of these nine months. Well, as regards to the balance sheet, although we have not presented a balance sheet in these nine months, well, no cash can there's been no cash consumption in these first nine months of the year. And in this quarter, we've paid the dividend in the month of July for a total amount of €15,000,000, and we've also paid an earn out for about €1,000,000 corresponding to delayed payment for the Gestedro company.
And with regards to the divestment in the Dominican Republic, would have to remind you that the $102,000,000 of this operation, we've already received $19,400,000 And when we signed this in July, dollars 62,200,000.0 will be received during the fourth quarter of this year and the other remaining €20,500,000 or dollars will be received in 2026. But to conclude, I would like to underscore that this year, 2025, has been a very relevant year as regards achieving the objectives of our strategic plan. We are culminating the transformation we set out to do with strategic investments and divestments, and we're advancing in this simplification process, which we hope will produce the disinvestment of the RITOS. And we also have the strong growth of recurrent activities. We have to strengthen that recurrence, which is one of the three pillars of our strategic plan and which is absolutely fundamental in these contexts in which we are living.
And this recurrence also makes us feel calm so that we can be ambitious with new opportunities like the GDE opportunity. We in our strategic plan, we say that sustainability and reducing the environmental impact of the industry was an opportunity we had to make the most of, And we have configured ourselves and organized ourselves to get it done. Our target in this area is to make use of these tailwinds to become a reference in Europe as regards environmental solutions for industrial customers. We have the capacity to become a compounder of different players and to grow with fixed and mobile infrastructures in relation to the circular economy and decarbonization services.
And
with this, we want to build a reference platform at a European level that offers these environmental solutions to our customers. And that's all from me. I'm going to close here with the analysis of the results. Many thanks for listening. Now we can move on to your questions if you have any.
Thank you. Carlos, Good afternoon. Can you hear me? Yes. We can hear you now.
Good afternoon, everybody. Well, in previous years, you've given us an estimate of where the EBITDA would stand for the total year. Could you give us a reference, please? And then after that, I have another question, a question on services in the field of energy. Well, this is a double question.
You've grown, what is it, by 20%. And in the first half of the year, you'd have grown 9%. And I want to know if this has to do with the sporadic contracts or this has to do with new recurrent contracts. So, therefore, are we going to see stronger growth more than what has been reported until now? And then as regards this and as regards the contribution margin in q three, there's only been 5% of growth compared to 20% of growth in sales.
But this does this have to do with the initial costs of these service contracts? Or is it that there's less profitability attached to this business? And the third question has to do with tech energy. So if we take a look at the the projects, and if we look at q three, you use there's gonna be a turnover of €7,000,000 when on average it's been 35,000,000 under normal conditions. And while the previous quarter was very good, over 50, but in the data that you have reported to us, the figure was about 35,000,000,000.
So it's a drop of nearly 80%. And I understand your reasons, but perhaps could you explain this a little bit more in greater depth? Could you talk about the nature and the geography of these projects that have come to a standstill? Thank you very much. Thank you, Carlos.
If you want, I will start with the questions that have to do with the different segments. GDT GDT services, you were asking about growth and if it's more recurrent or less recurrent for some sporadic events. Because it's true that services is growing in a very significant manner, not only in this quarter, but I think that it's been growing during the rest of the year too. And the answer is that it's recurrent because our service world has that specific characteristics. So so this is why in the presentation, I emphasized that this growth also will become very visible in future turnovers, and we've also had some very significant operations in the first part of the year that are now being reflected in our accounts.
And that's regards to the margins. They haven't grown as much as turnover has, And, yes, that is true. It is true because when new contracts are initiated, there are certain initial costs involved, and then you have the ramp up of these service contracts that could have bit of an effect, a bit of an influence on the margins. So it is to be expected that we will maintain a strong growth in our margins and in our turnover in the area of services. As regards GDG projects, you were saying that we've had something like a 30 something million in turnover every quarter.
That is the case. And in the last quarters, although specifically, you can see that in in we're talking about a much higher figure, about 50,000,000 in the second one, and you know that projects do not have a linearity or do not have that kind of behavior that services have, and we can come across a bigger level to turnover in one quarter and lower in the next. Well, we had quite a lot in two, but we have less in three for projects. But in addition to that, and it's something that we've mentioned, the uncertainty that we're experiencing right now means that the turnover of the different projects in which we are involved is slowing down. And not only that there are projects that could have started that have not, but there are some that we are already working on that have produced turnover that is less than we expected it to be.
And then there's another factor which we've also mentioned sometimes. We have projects in the portfolio for renewables that we could execute, but which we are not going to execute until we don't have financial partners. And if that means that we have less turnover in a temporary manner, this was probably in favor of our financial stability, and that is the path that we think we have to follow. Hello, Carlos. I'm Robert, and I'd just like to add that well, yes, we're talking about two specific geographies in renewables and what we are doing.
Well, you know that we consolidate the projects, and we want to make progress in things that are rigid. Beaters would have no impact on the account because there are a couple of projects that are somewhat more stagnant because we're still trying to get all the pieces for the puzzle first. And that's why we've had less production and less turnover in that particular area. And as far as 2025 is concerned, let's say that there has been an impact. There's been less production in q three in the area of projects that, as Patrice has pointed out, this has been compensated by the most recurrent part of the company.
And I would like to say something that 2025, for us, we think that it's the year for the definitive strategic transformation. And this is when we have to focus on all of those concepts that we mentioned, the recurrence, simplification, etcetera. And what we now expect or we think that the end of the year will allow us to have a company that is ready to address the new plan that is coming along. And we've already shown the two main areas of the company, and I'd even say that more than guidance or commitment, what we are seeing is that what we're going to do, we're going to have a ratio here of one x of the net financial debt EBITDA. And if you want to have any more data, last year, the pro form a, I think, was a 142 in EBITDA when we closed.
I think that we have to stand without the range. I'm not sure it's a 140, a 145 or a little bit more, but with net debt levels at those levels as a starting point. And all of this considering that we still have a part of the company balance sheet or part of the company's debt that is funding the infrastructures, and this is part of the debt. And our idea is to advance and to eliminate this from the plan little by little. So you can see that in this approach, if we were to isolate that item, we want to go back to the dominion with low levels of indebtedness.
So with the pipeline and with the things that we're looking into right now, well, certain growth and m and a operations can be readily available so that we can generate more value in all areas. But more specifically, Patricia pointed out in this that we have set aside that has to do with the environment and the circular economy and decarbonization and try to focus much more on that. I believe that this would be the approach or this would be our target our target to fully focus on the year 2026. Thank you very much. I'd have another couple of additional questions on figures, but I will give the floor to my colleagues, and I'll raise my hand later on if if I can, of course.
Thank you very much, Carlos. Well, let's move on to the questions from the panel. Ruben Palonso, Alistin, couple of questions. Can the company confirm that after the reduction in interest rates, the deconsolidation of phone house and the soul of renewables and financial expenses going to be reduced from 60,000,000 to 30,000,000 by contributing another 30 additional million to the net profit in 2026. Well, I can't we come from a world of 16, as Patricia pointed out, and we had a pro form a situation.
And this year, we would reduce this by 10 or so. But first, we have to see some of the snapshot we have on divestments and net debt so that we can give you an exact figure. And, obviously, we are now following the path of reduction. We believe that an interest rate at about 2% will allow us to consolidate the the reductions that we've already seen this year. But, anyway, we haven't really done an exact calculation nor do we have an absolutely in-depth information, and we can't really give you any figures right now.
And the second question from Ruben. And if we were saying at the analyst conference, we were talking that the 150,000,000 in EBITDA was going to benefit from the reduction in interest rates and the sale of renewables. And this wasn't possible in 2025, but do you think that the results will be felt in 2026? Well, this is in line with what he said, and that is the sale of the Dominican Republic has what? A one on effect.
That's 16,000,000. And we're obviously now looking into financial expenses. And you know that at this company, we always set ambitious targets and aggressive targets too. And, yes, we do believe that we have the right work plan, and we're getting the company ready so that we can apply leverage to our profits and increase them. And we will then inform the market.
We will send to the market the guidances and the commitments that we will be approving during the board, and you will receive all the information. Yes. We have to submit a new strategic plan, and this new strategic plan, well, something that we're already given some indications on, but it will possibly be followed by an inorganic growth plan and an investments plan. And this is something that will also have to be reported through the income statement and through the p and l account so that we can fully define the upcoming strategic plan. But in any case, we're already looking into this, and we're seeing how this could be transferred to profits.
But first of all, we have to identify all the items correctly then clearly. Okay. Next question's from Luis Padran from GBC. Guys, I've got two questions. And could you give us an indication on the net financial debt at q three twenty twenty five?
And the second is what can we expect for the projects in q four in 2025? With regards to debt, you have the data was published. I think we finished at a 184 or 207 at July as from July. And in September, we don't do any disclosures. We have a little bit less debt than what we had what we had as of December, but I think that we've already answered that question.
And and I think then what we should have is a debt that is one to one with the EBITDA we achieved. And and that's where I think we could feel comfortable and where we are already heading towards what it is we want to achieve. As regards q four, well, it will be better than q three without a doubt. But as you know, and as was pointed out by Patricia before, let's say that our project could be better than we expected or somewhat worse. But in any case, I have to insist where do we stand?
Because we are not having any kind of gap here, and we are not focusing on the portfolio. The projects are there. We're very calm. We're comfortable. And this is an issue that has to do with the cutoff point in the year and to see how much we can actually execute, although we'll see.
We'll see how things turn out in the end. Well, we have another third question for Noosh Padron. And are we having any difficulties to obtain the funding for renewable projects? And if so, what are the reasons? No.
No. What I mean to say, I don't see any problems in terms of funding because we had to find an equity partner, and I have to reiterate our strategy. We are a neighbor of IPPs, and we are not taking any decisions of carrying out certain projects that we already have because one has to find a buyer for that project. You need to have visibility for all the pieces in the puzzle, and that's not only funding because funding well, obviously, it would be feasible and could be obtained, but it also depends on the quality. The quality of the funding is going to depend on the PPA that we can get, and it would depend on the quality of the solar or wind resource that the project has.
But what really concerns us more is this business of finding partners as we already have in Italy or in The Dominican Republic and other places, people that are willing to share or cover most of the project so that we can start to execute them or carry them out. Next question from, and he's asking us three about three things. The first, do you have an estimate of the EBITDA that will be contributed by the three companies you've acquired? Are their EBITDA margins similar to those that the company has, thirteen point three percent? Second, are you gonna consider more acquisitions for the rest of the year?
And finally, do you have any offers for the Saritos wind farm? So when do you think you'll sell it by? Well, the companies that we are acquiring do not have a big relevance. I think that on average, it could be about 1,000,000 in EBITDA h one. And the margins are obviously well, these are circular economy companies, and I think that they could improve that figure of 13%.
So the mix the the the mix could improve. And in that respect, there are going to be more operations from now until the end of the year. Well, there are possibilities, but one never knows when one is going to be able to close all of these opportunities. They do exist, and we are analyzing them actively, and we are looking into this. I think that as regards to Theritos, yes, the process is already underway.
And as Patricia pointed out previously, the project, two days away, we received the documentation for the migration of the project. And all of the trials that we had to perform have been done. So we're waiting for them to perform the definitive tests in Mexico. And as I say, now that we've migrated the permit, and this means that absolutely all the conditions have been met to formalize a sale operation. The process is underway, and we think expect that by December, we'll be receiving proposals, binding proposals, so that we can formalize the operation.
And I think that being reasonable and realistic, I think that by q one next year and this is what we can see right now. Although we do know that as from December, well, we know how much the evaluations are gonna be, where it is we stand, and we also know how we're gonna proceed and what decisions have to be taken. We're gonna give the floor to Carlos Trevino from the bank of Santander who's raised his hand once again. Hello? Can you hear me?
Yes. Go ahead, Carlos. I've got a couple of questions that have to do with Ficus more than anything else. The first one, you said that the inorganic contribution of these three companies has not been significant. Bit of I think that this is something you announced in June, and that is the purchase in Germany.
And you spoke about 26,000,000 in turnover. So could you please give me the figure of how much these purchases have contributed in the quarter? Or perhaps it is that you didn't close them in July and you closed them somewhat later. That's the first question. No.
That is sorry. Sorry. Yes. No. Go ahead, please.
Go. No. We announced them in July with the signings, but in the case of Germany, well, we then move on to q four. And, yes, it is true. It is true that they had a higher turnover.
The others are of Circuit Economy, and this one has a somewhat higher turnover because they were operating in a group that was stopping performing this activity, and it was not profitable. But in the case, we can contribute value there. But as regards q three, the contribution made by these three covered, I think, is zero or minimal. I think that even in the consolidation processes, we have not taken them into consideration. And as I say, in q four, this could be, I don't know, I dare say that it could be, I don't know, half a million or so, I dare say, roughly.
So it's not gonna be relevant. Thank you very much, Robert. And the second question has to do with the one off of the Dominican Republic that's gone up to 16,000,000 in the cumulative figures of nine months when in the June results you spoke about 14,000,000. So could you please explain that? Well, yeah, I'll explain this.
Yes. Certainly. When we formalized the Dominican operation, we carried we formalized the lockbox. In other words, the operation was formalized as of January the first. So all these projects were funded with an equity mix or with a capital mix and part of shareholder loan that we were where we were accruing interest.
So the what we had in that figure of 12% in the exchange rate for the dollar produced that effect of about €14,000,000, which is what we can see in accounts and something else that was also having an impact on our equity because of conversion difficulties. But what we were doing for the corporation to be homogeneous and pro form a relative to the previous year is that each of the quarters were accruing financial incomes that we are no longer accruing, but it used to be €2,000,000 approximately. So what I'm saying is that the exchange rate we've closed in September, practically the same as in June, remains at 14, but for there to be homogeneous comparison, we have to incorporate 2,000,000 that we don't have now in financial income, which is when Patricia said that the financial results have improved by 7,000,000. And so with this same exchange rate and with everything stable, the Dominican operation will have an impact that can be compared to the previous year, which is 14, 16 in September, and 18 in December, basically. And that is the effect.
And this is the explanation. So it's a comparative analysis of the different opportunity costs because so we're not accruing that part of financial income that we were doing in the past. Thank you very much, Robert. Okay. Let's move on to that question from.
And you said in the presentation that financial expenses have been reduced thanks to the reduction in interest rates. Have you used any of what anything of what you received from the sale of the Dominican Republic to reduce debt? Or is that reduction only has it only happened because of the reduction in interest rates? Well, we've collected the first $20,000,000 at the June. So we obviously, for two months, we had those dollars in our pocket.
Perhaps we didn't mention that, but we do expect well, let's say, we have an impact of the interest rate that it could be reversible. And with those dollars are in cash and we have them remunerated. Why? Because we believe that in the future, in Latin America and in The Dominican Republic and in Mexico, we're gonna have projects that are gonna be dollarized, and we're going to need those dollars. And those dollars are on the table for Dominion so that we can invest and rotate or whatever.
So we are we concerned about the rate of exchange? Well, in the very long term. But we believe that our functional currency in these projects is the dollar. The dollars we've received have not been exchanged, and as I say, we maintain them. So this exposure, there's something that is that latent and which we are going to maintain because this is going to be used to generate new contribution margins as a consequence of that rotation.
So I think that the answer would be yes. They have been placed, but we've had financial income for two months. It's about been about $20,000,000 for two months, roughly. Okay. We're gonna close the q and a section.
Thank you all very much for your questions, and we hope to see you again next quarter. Thank you very much. Bye bye. Good afternoon, everybody. Bye.