Good afternoon. Welcome to Ferrovial's conference call for the 2018 first half results. Ernesto López, Ferrovial CFO, will conduct the call with a brief review of the main highlights, followed by a Q&A session.
Thank you, Ricardo. Welcome everybody to this conference call. Starting with the highlights of the first half, I have to start again with the fantastic growth of our infrastructure assets. We have better performance than what we expected a year ago when we had the Cintra Capital Market Day. That is an important achievement. I mean, the traffic has increased across the board, and in our main toll road assets, we have double-digit EBITDA growth. Heathrow Airport and 407 ETR, both of them, grew their dividends in this first half. Regarding construction and services, we are trading in line with expectations. The EBIT margin in construction is 1.9%, and services, of course, is impacted by the Birmingham provision in Amey and Australia at the end of the immigration contract.
As we shall see along the presentation, the trend is clearly improving in line with what we were expecting. If we move to the next slide in the presentation, we have a glimpse at proportional reporting. The reason we do this is to show more of the proportion of economic performance that really the company is about, right? Because we have some very important infrastructure assets that are consolidated under the equity method. If we were to look at a proportional EBITDA, excluding the Birmingham provision, we would have reached EUR 787 million. Infrastructure is a very important component, 68% of the EBITDA contribution under this kind of methodology. Moving to the actual performance of the toll road division in the next slide. We have the title speeding up, clearly is what we are seeing. We are seeing solid financial results on a like-for-like basis.
Recorded as on a statutory basis, last year, we had Portuguese toll roads consolidated under global consolidation. We don't have them anymore. We sold part of that, and the remainder is under the equity method. Okay, we look at the existing roads. There's a growing contribution from the USA. We have higher dividends with the 407 sending EUR 113 million to Ferrovial and the rest of the toll roads, EUR 7.3 million. In terms of the new openings, this is important because we are seeing a lot of growth. Now we are really happy to announce that in July, we had the opening of the NTE 35W. This is a North-South corridor in Fort Worth, connects with the NTE 12, therefore the connectivity of the NTE 12 will improve. This corridor has had the fastest traffic recovery from the pre-construction levels. Okay.
Also you could imagine that drivers in the area have tested the other ones, and now they would be comfortable using this NTE 35W. In terms of, as I said, traffic across the board, you see, I mean, we have a map with growth all around. In the note you have the different toll roads, and all of them are showing very good performance. Moving to the next slide, regarding the 407 ETR, you probably saw the results already. I would like to highlight some of the stuff going on. You have the traffic performance, even in an environment where oil prices are going up by 20% in the area, in local currency.
The revenues and EBITDA, as I said in the introduction, are growing at double digits, and the traffic is increasing, and increasing 2.2%, also with some higher trip lengths helped by the extensions to the East that basically expand the catchment area. If we look into the performance of the region from an economic point of view, this is clearly showing some tailwinds, right? Like GDP is growing at 2.5%, population is growing at 1.7%. Unemployment is just 1.6%, very low. Personal disposable income is going up by 5.8%, retail sales are going up. Inflation also is going up more than last year. All this is helping to the growth of this fantastic asset. In terms of dividends, we see the growth profile in the right bottom corner, and you see that in the first half, CAD 453 million were distributed to financial shareholders, 100%.
Moving to the next slide, the headline figures of the Managed Lanes NTE and LBJ. Again, double digit in revenues and EBITDA. I mean, you look at the LBJ growing more than 24% in revenues and EBITDA more than 25%, and traffic more than 8%. The NTE is showing also outstanding figures with 18% in revenues, 19.8% in EBITDA, and 5.9% in traffic. This looks good, and part of the explanation is also that the area is having an excellent performance. In the next slide number eight, we see the macroeconomic indicators in the area. You can see that in terms of non-farm employment, year-on-year, the metropolitan area of Dallas stands out compared to the rest of the U.S. If you look in the population growth, and it's 1.6%.
This is not especially remarkable against the rest of the U.S., but really the economic performance is. Moving on to the next slide from the new managed lane open, we look at the area in a little bit more detail, right? We have a map here where you see the 820 is what we call NTE 12. Well, this is the managed lanes along the 820. You see the NTE 35W that runs north-south from the Alliance area with Alliance Airport to downtown Fort Worth. The Alliance area is quite interesting because it keeps expanding. You have logistics centers there from very landmark companies like Amazon, FedEx, Kraft, Walmart, and the rest. The residential development that is taking place in that area, it's also important and should increase the catchment of that corridor. Regarding our participation in that project is almost 64%, 53.67%.
The length is 10.2 miles, the remaining concession period is 43 years, with a total investment of $1.3 billion. Another connection to this network in Dallas, Fort Worth, and it is important because we are seeing that the more of these Managed Lanes that get connected, the better traffic flow, the more catchment and capture rate that we can have. Right? Moving on to another division, airports. You probably saw the results from Heathrow. We start with that. Heathrow keeps posting record traffic pretty much every month. The passenger satisfaction keeps being very high. We are reaping the benefits of all the effort that we will show in the next slide. In terms of revenues, it is at 2.3% growth, it should be higher.
The reason I said it should be higher is because Heathrow is providing incentives to airlines in terms of lower tariffs for cleaner and quieter aircraft. This implies that yield dilution that can be recovered in approximately two years, right? The retail income is performing well and helping to a 2.3% growth in revenues. The reason why EBITDA is a touch lower is due to more cost regarding to winter maintenance. Many of you remember the winter in the U.K. has been quite harsh this year, this affected operational expenses, but the performance of the airport was outstanding in that season, with other airports closing and Heathrow really maintaining a very high level of satisfaction. In terms of traffic by area, Heathrow is very well spread across the different regions, showing that there is demand to use Heathrow from all over the world.
Regarding the AGS, we see a good performance in EBITDA growth, despite the traffic being a touch down. The reason it is a touch down is mainly due to some very bad weather in Scotland, with a couple of days closing of Glasgow and some weakness in traffic from some of the low-cost airlines. Despite that, pardon me. Despite that, we saw the growth in EBITDA helped by the initiatives in retail spending. If we move on to the next slide, we see the kind of effort that has gone through Heathrow, making it an outstanding airport towards passengers, always with the passenger in mind in terms of satisfaction and renewal of the airport, right? Just look at the overall score since 2007, when it was at 3.43. It has gone up to 4.16 in 2017, basically rallying against competitors in Europe.
In terms of punctuality, regarding the airport being close to capacity in terms of air traffic moves, now we have 83% of the flights departing within 15 minutes of schedule, whereas in 2017, it was only 63%. The growth in terms of traffic has been phenomenal. Also, security, the rating by passengers going through security, rating it as great or excellent, has gone from only 44% in 2007 to 74% in 2017. Also very important, one of the objectives is to have clients satisfied and traveling with their bags. Something that in 2007, there was 40 bags misconnected per 1,000. Now it is only 11, and working always on this. Okay. All this great effort now faces the fact of limited capacity and a lot of demand to use the airport, right? It is really great news that the U.K. Parliament approved the third runway.
It's a process that still has a lot to go. We have some of the data around this project in this slide. It's 3.5 kilometers long, the new runway northwest of the airport. The total flight movement capacity that Heathrow Airport would have would be 740,000, achieving 130 million passengers. Very importantly, adding jobs to the U.K., 180,000. Economic benefits to all the U.K., we have always to remind that Heathrow Airport is a gateway, the most important gateway in terms of cargo traffic in the country. Moving now from infrastructure to construction and services. We get into construction. Construction is performing in line with expectations. It's true that margins in Poland are tighter than what was foreseen some months ago. The tighter margins come from increase in prices in raw materials and labor and in subcontractors across the country, right?
It has affected the whole sector. As always, Budimex tends to navigate in a better position, but is basically suffering this effect. That impacts the kind of expectation that we had to the lower part of what we expected. The year-end forecast in terms of margin for the whole division is 3%. Of course, part of this margin will be achieved if we release provisions from works that are finalized. We just announced that the NTE 35W has been opened by Cintra and its partners. That construction has finalized. We wait for some months and see if we can release provisions here. That's an example. Just anticipating one of the questions that you may have. In this first half, in terms of provision release, we have a net provision charge. We have EUR 4 million of net provision charge, not a provision release.
Of course, at the end of the year, we expect to have a provision release, and that is what is supporting margins of an otherwise tight margin division according to the environment in the construction sector. Moving to services. We review the performance that is in line and with the guidance that we provided. Looking into Amey ex Birmingham, the margin in the first half in terms of EBITDA was 1.5%. There were some one-offs affecting the EBITDA. Otherwise, the margin would have been 3.1%. Which were the effects that affected the performance? One of them was the finalization of the CapEx phase in Sheffield that took an important amount of the EUR 17 million that is the sum of all these one-offs.
The good thing is that we are happy to say that the CapEx phase has been signed off, therefore we move into another phase. This derisks the project substantially. Also, we had in Milton Keynes, that was this energy from waste plant that was in the construction phase. We had also to have some overexpenditure there, we are happy to say that the plant is up and running, also that means derisking of the asset. The remainder of this kind of one-offs was harder, as we said before with Heathrow Airport, harder winter than expected, therefore we had more maintenance costs due to this weather effect. It would have been 3.1% otherwise. That means that we are on track for the remainder of the year.
Something that probably will be consolidated in the second half is also more business with Carillion Rail. We have some joint ventures with them. If European competition approves, we should be getting more business that should add to the profitability. We have always to remind that the performance of the consulting and rail division of Birmingham is the most outstanding. It usually has double-digit margins and additional capabilities, right? The evolution of Amey will keep improving as we leave, let's say, infrastructure maintenance contracts that are making some losses, or facility maintenance that is making some losses, and we have more proportion of the good margin stuff. Regarding the provision that was commented before, but it's worth talking a little bit about it in this first half results. We recorded a £208 million provision, EUR 237 million.
It's pretty technical in the sense that part of the provision is related to CapEx that was expected in the life cycle phase. The client has instructed for it to happen in the first phase, the CapEx phase, before it is signed off. That means that we have to take a hit because there's no revenues in that part. That doesn't mean that there's no economic substance in the contract to compensate for that. Another part of the provision is related to aggressive penalties being charged by the client. Of course, these charges will be challenged. We basically have what we think is a prudent provision, and it's quite technical in part in nature. Also, it's worth mentioning that Amey and the services division are doing some non-core disposals to help generate cash.
Amey is advancing on some PFI participation divestments, this should help address the cash needs. It's important that each business of the division is capable of basically being self-sustainable. In terms of other stuff that is going on in services with the good margins in Spain, is that we have some additional dividends from some services concessions in Spain. We'll talk more about that later with the cash review. Around EUR 68 million was cashed in with dividends from this. There was also this proposal of more participation in a renewable fund in Australia. The services business keeps doing some of these minor divestments in non-core business, adding to the part of the business that has more margin, like consulting and rail.
Another achievement was the Wales and Borders project with Keolis, with Amey doing the most of the part in the infrastructure development of the rail network in Wales. Doing more of that, extracting more cash from some disposals. The focus is clear on improving margins along time. Regarding the rest of the comparison vis-a-vis last year, I would also like to remind you that last year we had the immigration contract in Australia that is no longer there. As I said, the division is trading along what we expected for the half and working more to improve profitability. Moving to the cash flow and net debt evolution. We closed the first half with a net cash position of EUR 906 million. The main drivers here are more dividends and capital distributions from projects, EUR 307 million compared to 259 last year.
Here we see the EUR 130 from the 407 ETR, EUR 87 from airports, and EUR 81 million from services that I mentioned before. We are working on this to see if we get a little bit more for the remainder of the year. We also had more investments this year, operational investments, EUR 135 versus EUR 126. We had fewer divestments. Last year, remember that we had the sale of Norte Litoral, 31% of Norte Litoral, and also a very small stake in Budimex, 3.9%. In terms of shareholder remuneration, it is a little bit higher. It has been accelerating. More than having a quantum change, it is having more at the beginning of the year. Last, the very important working capital evolution is similar to last year. We have EUR 482 million consumption, a little bit better than last year. Okay.
Just before getting into the Q&A session, just having a summary of what we think is the most outstanding of the results. I cannot start with other part than the strong performance of the infrastructure assets. It is not that they are performing well, they are performing better than what we expected. The growing dividends is also something that is expected to keep going in the future. The third runway approval is something very important. Still, there is a long way to go, but it is a project that is very much needed for the whole of the U.K. transportation. We have last but not least in this part, the full opening of the NTE 35W, another part of that network of Managed Lanes in Dallas-Fort Worth. Okay. Construction and services is expected to improve margins at year-end. I have talked about that in the previous slides.
Looking forward, we will keep on looking to mitigate risks in contracting, to allocate capital more focused on infrastructure projects, mainly in the U.S. 2019-2020, we should be seeing dividends from NTE and LBJ. Okay. No more, let us say, a strategic discussion at this point in time. We think now we can open the floor for the Q&A session.
Ladies and gentlemen, if you would like to ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two. When preparing to ask your question, please ensure your phone is unmuted locally. Our first question on the line today comes from Guy MacKenzie from Credit Suisse. Please go ahead.
Hi, good evening. Thanks for taking my questions. I have three. Firstly, on Heathrow. You discussed the third runway. I was just wondering if you can give us any update on the process from here, and specifically any update on where you are and what the timeline is with the CAA in terms of agreeing your returns and remuneration for that project. Second question is on Amey. Obviously, there's quite a mix of businesses and quite a mix of contracts within that segment. You talked about allowing loss-making contracts to roll off, but I'm wondering whether you'd look at potentially crystallizing some of the value through sales of assets within Amey. Specifically, you mentioned your Milton Keynes energy from waste plant. I guess you had Allerton Park, which came online this year as well.
We've seen some very high multiples on both the listed stocks of energy from waste and also on recent transactions. Just wondering if you've looked at potential sales of those or other assets within that business. Final question I just have to ask on constructions. I guess the margins there, guidance was 3%-3.5%. It's now about 3%. You say it's mainly on provision releases in Q4. Correct me if I'm wrong, it doesn't seem to be a sustainable driver of higher margins, or even a cash improvement there. I'm just wondering if that implies that if there is no change in the current environment, your construction margins in 2019 could in fact be lower, or if you think 2018 will still be the trough.
If you're able to say anything on the contribution of the I-66 project over the back end of this year towards those margins, that would be helpful as well. Thanks very much.
Thanks, Guy. I think for the sake of time, I can take the three of them. I have with me the CFOs of the divisions. Probably will take the three of them. Regarding the third runway and the CAA, we are still some time away from having the final view from the CAA on returns. Of course, they've been exchanging drafts, and this could be going back and forth for a good part of 2019 as well. Maybe end of 2019, maybe beginning of 2020, we would have more clarity, even though there will be some indication in the different drafts that could be exchanged initially. There's still a lot of work, also a lot of work in design and finalization of CapEx. Also, Heathrow has to finalize the business plan.
We are still a good time away, even though there will be conceptual discussions and papers publicly shared by the CAA. Probably the expectation is more for end of 2019. Regarding Amey, you are right about what you are saying about transactions happening. The only thing I can comment now is about some PFI disposals going on. I cannot make any further comment at this point in time. Regarding what you said about the margins, you are right that the environment in construction is tight. You talked about the I-66 being a project that could be better, and you are right. In 2019, the I-66, given the way we account for things, won't be showing margins much better than those. We cannot make much comment about 2019 at the moment. Only that the situation is tight.
I prefer to have low expectations at the moment and keep you updated if things change.
Okay. Understood. Did you previously say, and I may be wrong, but did you previously say that margins in 2019 in construction should be at least as good as they are in 2018? Or is that not necessarily the case?
They could be similar, yes. We have part of the international projects improving, but we see pressure in Poland. Unless in Poland for the overall sector, there is some sort of price review, that has not been done in the past, but in other countries has happened in this kind of situation. If something like that doesn't happen, Poland will have a tighter year. The combination of those is difficult to say that they could be much different from today.
Understood. Thank you.
Thank you, Guy. Next question, please.
Our next question today comes from Bruno Silva from CaixaBank. Please go ahead.
Hi, everyone. I have three questions, actually starting with a follow-up on the guidance and services and construction. Regarding Amey, your guidance of 2%-3% EBITDA margin for the full year of 2018, of this year, that you said in the conference call two quarters ago. Were you already counting on these one-offs from Sheffield and Milton Keynes? If not, I just wonder if something is going better than expected at that time, if you could confirm that as well as whether you will be closer to 2% or 3% this year in Amey. On construction I think it would be useful to understand the underlying trends and not so much on the effect with provision reversals. If you could clarify in this 3% full year 2018 EBIT margin for construction, what would be that component?
What would be the guidance of the margin ex provision reversals? Finally, on 407 ETR, a doubt that I have pending regarding the net debt evolution quarter-on-quarter. I think in local currency it deteriorated around CAD 500 million. When we look at cash flow and dividends paid, it only suggests a deviation or an increase in debt of around CAD 100 million. If you could clarify if there has been any change in accounting or something like that, I would appreciate it. Thank you very much.
Okay. Well, the last question I did not get properly. It is a question that we can provide clarity probably later on. If you could rephrase it that would be helpful, but I think this question has been asked some time before. We can provide it, but if you could rephrase it, that would be great. Let me get the first two ones, then you can rephrase the last one. Regarding the EBITDA margin guidance for Amey, no, these one-offs were not considered at the time. But it is also true that we were expecting other things that could happen, and therefore we are comfortable. Our expectation probably was higher than the guidance already. Then not incorporated in the guidance were the new business that will be incorporated from Carillion Rail. Amey should be okay.
Regarding the construction division, we do not provide the breakdown between underlying margin and the provision release. As we always say, the market, the current production is between 1%-4%. We should always be moving along those margins. Maybe now are more in the low part of the range, as you see now in our accounts. The thing is if we can get in the production and running some of the stuff that is with margins more in the high part of the market. That will be happening a long time, but as I said before, we would also see pressure in Poland, so it is difficult to see very different margins, and we prefer to update as things evolve in the near future. Okay. Regarding the 407, could you repeat the question? I could not get it properly.
Sure. Just before that, if I may. Did I understand correctly that in Amey, the guidance of 2%-3% should actually be closer to 2% considering the one-offs that you accounted this quarter?
No. Regarding that, what I said is that we were not counting on these one-offs. We have 1.5, we should have had 3.1, but those are off for the remainder of the year, right? We were expecting higher margins in the remainder of the year. Additionally, we have a new business that should help. All in all, no, we should be along the range, but not necessarily at the bottom. It could be better.
Okay, great.
Okay. Could you repeat the one on the 407, yes, please?
Sure. The 407 net debt versus March increased by around CAD 500 million. When I look at the operating cash flow, actually at the cash flow statement, the generation of cash has been negative by around CAD 100 million. There is a gap of roughly CAD 400 million that I cannot really explain. I'm not sure if there has been any change in accounting or something like that could have justified this net debt deterioration in the quarter. Thank you.
Okay. We provide that information. There's one thing that out of my mind could be helping there, that is accrual of inflation on the inflation-linked debt , that kind of thing, but we'll provide more detail. We'll see we can get a little bit more in the conference call, and if not, we'll do that in writing.
Okay. Thank you.
Our next question today comes from Marcin Wojtal from Bank of America Merrill Lynch. Please go ahead.
Yes. Good evening. Thank you for taking my questions. Number 1 is just coming back on U.K. services. Can you remind us, the Birmingham contract that was discussed extensively at the beginning of the year. What was the contribution to EBITDA? Is it still diluting your EBITDA a little bit in the second quarter? What are the next steps? Will that contract continue? It is a very long-term contract. Do you see any scope to potentially terminate that contract at some point? Question Number 2. Can you remind us what is the balance of factoring in the company at the end of the second quarter?
Okay. Regarding the EBITDA of Birmingham, we have applied part of the provision, GBP 45 million in the first half of the year. Okay. The provision has been applied. It has had no impact on the P&L apart from the hit of the provision. The other question that was regarding the amount of factoring in the balance sheet, we will be gathering that data and providing it either later in the call or in writing. We are gathering the data.
Okay. Thank you.
Our next question today comes from Vittorio Carelli from Santander. Please go ahead.
Hi. Good evening. Thank you for receiving my question. One, regarding the cash position of Holding Co. You have around EUR 900 million, which is the pro forma data excluding the EUR 500 million of the hybrid bond and the Poland cash position. Secondly, about the net working capital, which shows a similar situation as of the first half 2017. At the end of last year, you recovered some, or you had some prepayment that improved the situation. Should we expect the same for the end of this year in order to improve also the cash at the Holding Co in Ferrovial? The second question is related to the dividends from Heathrow. We had last year GBP 175 million, more or less, coming in extraordinary dividends. Should we expect additional extraordinary dividends this year in the second half from Heathrow? The last question is on WestConnex.
We think that Transurban is now under investigation, so probably could not be allowed to bid. Would you come back and put a bid on these important assets, or you are completely out of the process? Thank you.
Thanks, Vittorio. Regarding the net cash position, yes, in the EUR 906, we are considering the hybrid as equity as per the IASB accounting, right? If we take out that, it would be obviously EUR 406 million. Regarding recovery, you rightly pointed to some advanced payments in construction due to the financial closing of financing of the I-66 and the Denver Airport. We don't have any project like that expected this year in terms of financial closing, right? Improving the gap should help some of the divestments of a small non-core and maybe other dividends from some concessions, but I cannot provide a guidance on that at this point in time. Regarding the Heathrow dividend, neither Heathrow nor the shareholders are providing any guidance at the moment. At the end of the year, we'll review to see the performance.
Of course, the inflation seems to be a tailwind in that regard, but we cannot comment until the end of the year. Regarding the WestConnex situation, I will pass that question to Paco, the CFO from Cintra. Before handing that to him, I would just like to mention that the previous question regarding the level of factoring in June. In June, we have EUR 55 million of factoring. At the end of the year, 2017, it was EUR 88 million. There has been a net reduction of factoring, and that has hit, of course, the working capital evolution. Paco, you can take the WestConnex.
It's quite simple. Unfortunately, as is customary of this type of projects, we are under confidentiality agreement, and we cannot disclose anything in relation to this project. I'm sorry.
Yes, the confidentiality agreement is related to the main terms of the processes. Just asking whether you are still willing to perform a bid or not.
Even that, Vittorio, is subject to confidentiality, given the NDA signed. We cannot comment. I'm sorry.
Okay. Thank you.
Our next question today comes from Stephanie D'ath from RBC. Please go ahead.
Hi. Good afternoon. I have three questions, please. The first one is on the reason for the pressure on Polish margins in construction. Could you please specify if the reasons in Poland are really specific to that market or if those reasons could spread in other markets in Europe? Second question is regarding your contracting businesses overall. You mentioned earlier this year that you were reviewing all your businesses and looking at potentially restructuring. Could you please tell us how much progress you have made on that front? Finally, could you please confirm the Australia services EBITDA margins for the full year is still 3%-4%? As you gave a bit more insight on where you expected construction and U.K. services to finish, could you maybe please do the same for Australia? Thank you very much.
Well, thanks for the question. I will pass to Javier the one regarding the costs in Poland. Regarding Europe, in Spain, we are not seeing that kind of pressure, activities is not very high. I will pass Javier for the Polish one. Before I do that, you were asking about strategic analysis. I cannot make any comment at this point in time beyond what I mentioned of some small divestitures. Regarding the margins in Australia, yes, the 3%-4% is confirmed, we cannot provide any more detailed guidance. We are not willing to do that at this point in time. We keep improving the businesses. We prefer not to give any specific number at this point in time, the guidance is confirmed. Javier, if you could take the Polish cost story.
Yes, of course. Due to the high activity and the dynamism in civil works, mainly, well, in overall construction activity in Poland, as Ernesto said, there has been an increased evolution of cost in raw material, labor, and subcontractor. That so far is what is impacting in the margin as Ernesto said. Answering your question, it's an overall context for all the construction companies and what they are publishing quarter by quarter. I hope this is enough.
How long do you see these factors put pressure on the margins is important. Is it very short term, should the markets come back to its margins soon, do you see pressure for the coming years? Thank you.
Well, some things that are happening that I can comment maybe is that some works that have been awarded, they don't get started because of the change in prices, right? Some bids come to the market, and all the bidders are above the offer price. It's an overall situation that should be adjusting. It should adjust and not keep snowballing. Regarding the margins of the past, usually those happen when there's counter-cyclical bidding. After when you are basically close to the trough of bidding, maybe you can get better margins with less participants in the market, right? All that has to do with the cycle. In terms of pressure, we don't see any snowballing. We see tighter margins, a kind of a slowdown, and let me hand it over to Javier again.
Thanks.
Even with the consideration and the detail we are giving, the truth is that the 4% of Budimex EBIT margin is a very acceptable one and clearly the leading one in Poland nowadays.
Okay, thank you.
Our next question today comes from Guillermo Fernandez from Kepler. Please go ahead.
Good evening, everyone. It's Guillermo. Most of my questions have been already answered, but I still have one. Regarding the contract you are taking over from Carillion, could you confirm if it's going to imply a cash outflow in terms of, like if you were buying those contracts, and if any, how much would it be, and when should we expect that? That's the only one pending. Thank you.
Hello, this is Fernando Gonzalez, CFO of Services. Well, the contract will be neutral and confirm the cash point of view because the inflow of EBITDA will be higher than the payment. For your projections, it's neutral.
Okay, thanks.
As a reminder, ladies and gentlemen, that's star followed by one to ask any further questions. We have a follow-up question from Vittorio Carelli. Please go ahead.
I'm sorry, Ernesto. Just a clarification on net cash, excluding also Budimex, and excluding also the hybrid, which is the net cash at Ferrovial S.A . The second one is, can you explain why you have such higher shareholder remuneration so far? This is something that we realized also in the first quarter, if I'm not wrong. Just more color on this. Maybe I'm missing anything here. Thank you.
Okay. No, the higher remuneration, I'll take the last one first, comes from basically the purchase of shares. You know that remuneration is a combination of dividend and buyback of shares. We have done more buyback of shares at this level, right? That's the reason why we have more cash outflow for shareholders, right? Regarding before I get you the number on Budimex that we are getting, the one that you asked, I also have an answer for a previous question that the cash movement in the first half of 2018 is EUR 276 million, not the EUR 500 mentioned. We'll have a clarification of that in detail later on. Probably from the report, the numbers being cut by the analyst were not the correct ones. We will be sending those. Let me try and get the number on Budimex. Okay, Vittorio, we'll provide that later on.
Okay.
Comfortably in the call.
We currently have no further questions on the phone line, I'll hand back to the team.
Well, thank you all for the call. We have pending the net position of Budimex that is coming. Before I close the call, I will be providing that. The cash position in Budimex is EUR 151 million cash, and in terms of debt, it should be very small, okay. Just get the EUR 151 million as the net cash position. You will have to subtract that, maybe not fully, maybe just proportionally, okay.
[Foreign language].
Well, thank you. Thank you all for the call, and have a good break if you can get it, and see you after that. Thank you.