[Foreign language]
Good morning, I'm Manuel Manrique, Chairman and CEO of Sacyr. Joining me today, as usual, is Carlos Mijangos, the company's Chief Financial Officer. Thank you very much to all of you, analysts, media representatives, and investors, for attending this presentation of Sacyr's financial results for the first quarter of 2024. Today, profitability and cash flows are the two key financials to Sacyr's business today, with more than 90% of our EBITDA and our backlog dedicated to transport, health, and water infrastructure concessions. In the first quarter, we improved operating cash flows by 28% to EUR 228 million. In turn, the EBITDA to revenue margin increased by 590 basis points, posting 34.1% in profit. Both data reflect the focus of our business model and management approach.
In terms of lines of business at Sacyr, we are focused on the acquisition and development of new assets in our portfolio that will increase our future cash flows and the value of the company. As a result, during the quarter, we should highlight the signing of the contract for the A21 Highway system near Turin in Italy, the financial closing of the Velindre Hospital in the United Kingdom, and the awarding of the Lima Peripheral Road Ring in Peru as part of our consortium. In terms of commissioning, at the end of the quarter, the Central Railway of Uruguay was commissioned, and in the coming days, the Pamplona-Cúcuta Highway in Colombia will be fully open to traffic. All such milestones set us on a predictable growth path, which is the one that we want for our company.
In terms of relevant corporate milestones, we continued to make steady progress in the divestment processes of some stakes in assets in both Chile and Colombia. Last January, we paid the first scrip dividend in the proportion of one new share for every 50 old shares. That is EUR 0.062 per right for shareholders who preferred to receive cash. Our commitment for the full year is for the dividend yield to be in the order of 5%. As we have already announced to the market on May 9, we will be holding our Investor Day 2024, where we will present the 2024/2027 business plan and the updated valuation of our concession assets. In terms of sustainability milestones during the quarter, I would like to highlight the double-A seal from CDP and Standard and Poor's Industry Mover top 5 rating.
Here you can see the main figures of the income statement for Q1 2024. Revenue fell slightly due to our tendency to reduce risk in construction, while, as I said before, cash flows, profitability, and EBITDA rose strongly, reporting a stable net profit that keeps growing. Next, Carlos Mijangos will give you more color and specific details of Sacyr's results on each of the business lines.
[Foreign language]
Thank you, Mr. Chairman. First off, Sacyr will start reporting the water line business separately as concessions and construction. So Sacyr Water will show its growth potential because it's a leading company in that area in Spain. As for transactions carried out over the quarter, in January, there was a forward contract over 10 million shares with a price of EUR 3, whereas in March 2024, we acquired 5 million shares of treasury stocks, which had a price of EUR 2.1.
So the company continues to focus on the value of its shares. As for the evolution of net debt, during this quarter, there was an increase of EUR 329,276,056 in the case of non-recourse debt. So this evolution shows that we were able to obtain EUR 166 million in financial results, EUR 290 million were invested in assets, and then there were some financing flow and Forex and adjustments of the scope of EUR 184. So we reached EUR 6.737 million. As for the evolution of recourse debt, it went up due to some seasonal impacts resulting from this kind of activities. There was an increase that was, however, below the average over the past years.
As for this increase in the FFOs amounted to EUR 18 million, we have to highlight 31 coming from concessions. Financial expenses spending at EUR 13 million, EUR 38 million were invested, 34 accounting for equity in our concessions. Scrip Dividend in January accounted for outflows of EUR 4 million, then the forward contracts accounting for EUR 11 million, and then financing flow and Forex variations amounting to EUR 5 million. So all in all, EUR 322 million at the end of this quarter. As for performance by business lines, concessions, as you can see here, remained more or less in the same level as in previous years. However, there was a strong increase in operating revenue of 14% as different assets become operational.
As for construction revenue or completion of works, they came down by 47% over the quarter because three major contracts have been concluded, like the Rutas del Este in Paraguay, that was completed in summer last year, and then the Pamplona-Cúcuta project in Colombia. There was a decrease of EBITDA by 16%, EBITDA margin going up by 66.4%. I should highlight that there were two assets that were commissioned, as I said before, the Ferrocarril Central and the Pamplona-Cúcuta, that will become fully operational in the coming days. As for the breakdown by country, in terms of EBITDA, in Italy, as you know, because of accounting reasons, this is accounted for in the construction division reports. However, the concessional EBITDA, as to the group's portfolio, it's...
So the Italy EBITDA amounts to EUR 94, Chile, Spain 28, Uruguay 27, Italy 78, rather, Chile 85, and these are the most important countries. All in all, we're talking about EUR 295 million. As for the engineering infrastructure, revenue came down by 13%. We continue to make efforts so that the percentage of activity in the construction line becomes increasingly more important. We are already spending at 62% in terms of activity here, with a backlog of EUR 9 billion. So these are some of the contracts for future concessions. As for the completion of some of our projects, we should highlight the two that we have already described. Then, A6 was commissioned in Northern Ireland.
EBITDA went up by 10%, posting EUR 1 million, and there was also an increase of 4.9% in EBITDA margin. Regarding the water business line, this is the first time that this is reported independently. Revenue went up by 3%, EBITDA went down by 7%, but there was an adjustment of scope because this line of business has been separated. EBITDA margin is above 20%. This is a backlog of nearly EUR 5 billion, with some significant awards over this quarter, such as the Alicante Desalination Plant or the Cuevas or the Carboneras Desalination Plants or the Cuevas de Almanzora water system. The three of them account for EUR 45 million in awards.
So, Sacyr is the leading company in desalination plants, and so in 2023, and this is all that I wanted to report, Mr. Chairman.
[Foreign language]
Thank you very much, Carlos. We now open the floor for questions for all the analysts that may wish to pose a question.
[Foreign language]
Good morning, everybody. Now we're going to start with the Q&A session. As usual, we will first allow all the questions that are coming over the phone, and then we are going to allow for questions over the webcast. Miguel González-Toquero from... please go ahead.
[Foreign language]
I have three questions. First, the question about the working capital for the quarter.
Could you please confirm that the outflow of EUR 45 million over the quarter in the case of net, net working recourse includes the payments that had been delayed in the prior quarter of EUR 75 million, and are there some outstanding collections? As for the construction activity, as you mentioned, there was a significant drop in revenue due to the completion of some projects. When do you think that the activity will be picked up or will rally, or when do you think the new projects will offset this negative impact? Finally, I would like to know whether the decision to report the figures of the water division had to do with the possibility of divesting in this business, or whether this is something that you are not considering for the time being.
[Foreign language]
Okay. We will get back to you in a minute, Miguel.
Thank you, Miguel. I will answer the first question. As a matter of fact, the working capital for this quarter accounted for an outflow of EUR 45 million. But as I said before, during this period, the average over the past three years stood at EUR 125 million. So we received those EUR 75 million, and this is part of the seasonality of this industry. As for the other questions and concerning the construction activity, a similar situation took place last year. In the second half of the year, we expect to recover. Here we're talking about construction within the concessions division. As for infrastructure, this is a strategic business line, and therefore, we do not want to really grow there. We want profitability rather than growth.
As for reporting the water division separately, there's no actually any consideration that we are making at this point about that investing in that business line.
[Foreign language]
Thank you. The next question is by Luis Prieto from Kepler Cheuvreux. Please, Luis, go ahead.
[Foreign language]
Good afternoon. Thank you very much for your time. Since you're about to hold Investor Day, I believe that you will perhaps address some of these questions on that occasion. However, I would like to take this opportunity to ask the following. That is, a contribution of Sacyr Concesiones to the construction backlog that has gone up from 51%-62%, quite a considerable increase. Which is the ideal proportion of this contribution? Should we expect a higher value? Does this mean that... I'm not asking about the dynamics. I'm asking about the implications that this actually has. Thank you.
[Foreign language]
One minute, Luis, and we will get back to you in a minute.
[Foreign language]
Luis, as we have mentioned on other occasions, our strategy is to focus on the concessional business line, whereas infrastructure and construction are not within our priorities. Actually, we want to bid less and less, and we will address, in fact, these issues on our Investors' Day on May the ninth. I would like to surpass 70% as for the share of construction in our concessional assets. You're talking about fixed expenses? Sorry, Can you repeat that? The chairman speaks of 70%, but actually you can never reach 100%, because you really need to take into account fixed expenses for the transaction to be profitable. Actually, we want to keep on operating in Spain with some contracts that are risk-free.
In order to keep up with our competitiveness, we need to remain active in some concessions, and we are going to give more details about this during our Investors' Day.
[Foreign language]
Okay, thank you for answering.
[Foreign language]
The next question is by João Safara from Banco Santander. Please, Joao, go ahead.
[Foreign language]
Good morning. I have two questions. The first question: what should we expect going forward in terms of revenue from concessions in Italy? You have spoken about the A21 Highway. The Pedemontana Highway is already operational, especially concerning Pedemontana. Over the past quarter, there have been some ups and downs. Therefore, we could use the first quarter as a benchmark for the coming quarters. There has been quite a leap in terms of margins. I would like to know that this is due to the official opening of the Pedemontana Highway.
The following question is about the concession that you were awarded in Peru. I believe that you will also address this issue during the Investors' Day. Could you give us a line of order in terms of the equity that will be allocated to this project?
[Foreign language]
Okay, Joao, we'll come back to you in a minute. Thank you.
Okay, let me answer, Joao. As for the first question, Pedemontana is a financial asset. As you know, it has an accounting specificity concerning EBITDA during the construction period. So the adjustment that we carry out once it becomes fully operational is the cause for this difference between revenue and EBITDA during 2024 vis-a-vis 2023. But in answering your question, the answer is yes.
Every quarter, actually, the figures will be more stable because the investment period has been completed, therefore, there will be no impact of EBITDA on the investment. Then we will provide you with more color next week as to how this project is about. Here, we're talking about some acquired commitments, and we're talking about EUR 3 billion.
[Foreign language]
The next question is by Fernando Lafuente from Alantra. Please go ahead, Fernando.
[Foreign language]
Good morning. Good afternoon. A very quick question about the evolution of corporate debt with recourse. You spoke about an outflow of EUR 45 million in working capital due to the seasonality of Q1. How should we expect working capital to finish fiscal year 2024?
Carlos, could you please give us some color as to how that should close at the end of the year without the sale of any assets? Thank you.
[Foreign language]
Okay, just one minute, Fernando. Thank you. Mira. As for working capital, throughout the year, we intend to post an improvement in the second quarter, even third quarter. Sometimes we have also reported some inflows. Our expectation is that this will be neutralized by year-end. Regarding the key movements on the corporate side, well, here we are talking about investments and distribution of assets, and again, we will give you more detail about this in a week's time, Fernando. So as for net debt with recourse, this is directly related to what we have invested and what we will be collecting, but in a week's time, you will get a full answer on this question.
[Foreign language]
There are no further questions over the phone, so we now read the questions by Webcast from Bestinver, Alvaro Navarro. Alvaro, you're asking about the EBITDA guidance, cash flows, investments, and dividends.
[Foreign language]
Well, all that information will also be provided to all investors on May the ninth. So for the time being, if you would allow us, we will not answer this question. Then you asked two more questions about tariffs in Colombia and Chile's toll systems, and whether any adjustments have been made as a result of inflation in this and whether there has been any impact in this regard, and finally, whether we are worried about any drop in traffic that has been reported in Colombia and Chile. So we will answer in just a minute, Alvaro.
Okay. [Foreign language]
As for toll tariffs, in February this year, all pending payments of 2023 were collected. Regarding traffic, it is true that the, there were some drops, regarding some assets, but both in Chile and Colombia, these projects, are tied to some mitigation systems. In Colombia, a certain adjustment is carried out every five years, and in Chile, there is, an extension is granted. Therefore, this is all part of the mitigation mechanisms, that somehow offset a drop in traffic.
[Foreign language]
Philippe Leite from CaixaBank, you have a question, the first one about engineering infrastructure, excluding Pedemontana and the A3 Highway.
[Foreign language]
I believe that that question has already been answered by the chairman. You ask about, the reasons behind the drop, and then you also ask about working capital that has been adjusted by twenty...
by 75, and you ask about the guidance for, the full year, 2024. That question was answered when answering the question from Fernando from Alantra.
[Foreign language]
Okay, so now let me turn back to the chairman.
[Foreign language]
If there are no further questions, once again, we would like to thank you all for attending this results presentation and interest, and we look forward to, the next results presentation for the semi-annual results of the company. Thank you very much.