Good morning, everyone, and welcome to TR's 2024 full-year results presentation. It's going to be conducted by our Chairman, Juan Lladó, and our CEO, Eduardo San Miguel. It will last approximately 20-25 minutes, and you will be able to post your questions after the final remarks. And I'll leave the floor to our Chairman, Juan Lladó.
Hi, hello, everyone. Thank you very much, Antonio. And good morning or good afternoon. I don't know where you are, to whomever are listening to us. As usual, Eduardo San Miguel, you know, Técnicas Reunidas Group CEO, and I will guide you through these presentations. And at the very beginning, first of all, I will share with you, you know, all the main highlights that we have achieved over this year, 2024. Second, I'm going to give you guidance of 2025. Usually, guidance is left to the end. But we do believe that at this presentation, we'll flow much better if we start disclosing our targets and our ambitions for 2025 and even 2026. I will continue with an update of the most important or relevant, business milestones, three important milestones that have been achieved for the 2024 and 2025.
And then I will leave the floor to Eduardo, who will drive you through the 11 landmarks achieved by TR in this, in its operational performance. And as always, the main financial figures for the year. And I will finally, you know, wrap up the presentations with some, closing remarks. You know, highlights. I mean, the highlights here are very simple, five bullets, and I'm going to elaborate very much on it. You know, you have a lot, a lot of information there. We have, number one, order intake, EUR 4.8 million. Two, a very strong and healthy, very, and I like to underline healthy backlog of EUR 12.5 billion. I don't like to use it in terms of records and whatever because, well, this is not a race. Sales, EUR 4.5 billion, very much within our target.
EBIT, we were talking of a year of 4%, slightly above 4%, which margin, which is EUR 181 million. And very important, we closed the year with a net cash position of close to EUR 400 million, EUR 344 million to be precise. I do believe that these five figures, five achievements, are very much self-explanatory. And they are the first step, you know, of a very important sales strategy that we had presented to you last May. Later on, Eduardo will give you additional details on both operations and very specifically on these financial figures. So, let's not wait anymore, and let's move into guidance for 2025. I mean, back in May 2024, during our Capital Markets Day in Abu Dhabi, we shared with you TR's business strategy for the upcoming years. And, you know, we assumed commitments. And the reality is those commitments are being met.
2024 is the first step, as I said before. Starting 2025, we're more than ready to start these presentations with our guidance. With the guidance, which is slightly better than what a lot of some people had expected. We do expect, and that's our guidance, to have revenues for 2025 above EUR 5.2 billion. And we do expect, and it is our guidance, of having an EBIT in the neighborhood close to 4.5%. And I think this is, this is very important, and this is very important because it's also set our minds for the next slide that we're going to be talking about a very important milestone in our strategy, which is 2026.
But before that, let me, you know, do a quick, you know, analysis or a quick, to highlight two very important happenings, so to speak, that have taken place over 2025 for the last two months. The first one is Vaca Muerta. A lot of people think, you know, why is Vaca Muerta so important? I mean, Vaca Muerta is important. It's very important for us. It has to do with a customer that we want to work for. It has to do with the field that we have to work for, and it has to do with the customer and partners' services and technology they want to develop upstream. And well, you know, we'll, I'll do further development of Vaca Muerta later on. And also, very important, we have been selected for a project amounting to EUR 3.3 billion in the Emirates.
But we cannot do further disclosure until, obviously, as always happens, the project is fully signed. Having talked about 2025 and those very important messages of those very important announcements that have taken place in 2025, you know, you know, over the last few months, let's talk about the very important year 2026. In this sense, we are, I am, we, all TR team, and me personally, very optimistic of the positive trend of the market and the positive trend that TR is taking the right step to achieve all the goals and objectives for the upcoming years. Here you have the term ambitions with 2026. Some of you might think ambitions is the synonym of wish. Well, it is a wish, obviously, but it's not a wishful thinking. I mean, that ambition is becoming a reality.
It's becoming a reality that allows us to have greater revenues to EUR 5.5 billion. You know, that sends the message to you, analysts and investors, that our ambitions are close to being a reality with an EBIT margin above 5%. Very important because this is 2026. We said it in Abu Dhabi, and we said it today again. It's a very important milestone. It is the year that, with these results, we'll send TR back again to dividend-paying policy. It is a very important year. That's why we thought that guidance and ambition, again, of 2026, we wanted to present it to you at the very beginning of the presentation. Now let's talk about back-to-day-to-day business. Less ambitions and less guidance. Let's talk back to reality, back to the business.
Back to the business, I think it's important to present to you three, I mean, how many things have happened this year. It has happened in Kazakhstan, in Abu Dhabi, in the United States. Many things and a lot of delivery. It has been a very, it has been extremely busy years. But let, let me, let's first focus in three, in three happenings, so to speak, in three accomplishments that are somehow inflection points on TR's strategy. Number one, on November 24, to be precise, I think it was the 27th of November when we announced it. I don't know if it was the 27th or the 17th. I do remember that it was in November. Sonatrach decided to entrust TR as leader together with Sinopec to relaunch the very important and the very strategic refinery in Hassi Messaoud, Algeria.
Just a few seconds, and let's do a bit of memory here. This job was awarded to TR at the very end of 2019. We had a signing ceremony in January 2020. Two months and a half later, Sonatrach team and TR's team, we were all locked in. We all forgot that COVID started. We were brave enough, and we have a strong relationship because of relationship, and it was the first job that we started from scratch teleworking. It was a challenge for both, and we did. Unfortunately, COVID was more than teleworking. You know, 2021, prices went crazy. 2022, war, impossible. The project was put on hold. Today, together with Sinopec, our strategic partner, the three companies, our customer, Sonatrach, our strategic partner, Sinopec, and ourselves have been working together to relaunch this job very successfully.
If the job is, you know, above four billion euros worth, we know the job. We happen to be the leaders, but we have a very strong partner, Sinopec. And it's, and not because we have a strategic partner, because with them, we have done the largest refinery job we have ever done in the Middle East, in Saudi Arabia, and in Kuwait. So I have to say that, I have, I'd like to thank both Sonatrach professionals and Sinopec professionals because the three of them, together with my team, together with Técnicas Reunidas, have demonstrated over the last months the willingness of working together and the commitment for the Algerian market. So, I'd like to leave it very clear. You know, I'm extremely thankful, and this is a very successful, a very successful accomplishment. And now, other projects.
The thing is, I've already made the whole explanation of Sonatrach, which was coming afterwards, but I will, you know, better earlier than later. So let's, I mean, don't forget about it. What I said is important, and I wanted to say it. So now let's look at the second inflection point, the second very important announcement. Last November, you know, on the first nine months presentation, we already announced that we had been selected with limited notice to proceed to three very large, three extremely important, combined cycles. At that point, we already mobilized the project task force together with the customer. And right now, all the teams, TR teams, with our partners, are already working under very accelerated limited notice to proceed.
The engineering has been fully launched together, and this is very important that TR, together with the customer, we have already secured the turbines. Very important to meet our targets for the power island. So, you may remember that, often we have said that in this business, we're the only company that is working at the same time with the three technology providers, which are GE, Ansaldo, Siemens, and Mitsubishi. We are committed with this project, which is huge. It's a, when we talk about you see you read there 3.3 gigawatts, it happens to be that if this, the size, to give you a sense of reference, it's about one-third of the total capacity installed through combined cycles here in Spain. So this is very good.
It shows, you know, has very much to do with TR know-how, TR delivery capacity, and the, how our customer, and in this case, ACWA Power, probably the most important independent power producer for water and power in the Middle East. I think it's most important by far having trusted TR, the second customer. Again, we cannot disclose it yet. But this is very important. And finally, Vaca Muerta. Vaca Muerta is important for us. And I said for us, it is important, Argentina. It is important to work in the largest non-conventional oil and gas reserves in the world, which is a very important, it is a strategic pillar for the growth and sustainability of our customer YPF in the Argentine economy. We want to be part of that. We want to be the partner of YPF. We're going to be working with them on services.
We're going to be working with them on procurement, and we're going to be working with them, supporting them in construction for a total amount of slightly above EUR 400 million. I'd like to thank YPF because YPF, we have been working together for years. We know each other for years. It's important to say that this is the second job awarded to TR after COVID. At the very beginning of 2022, we started to work in the refinery to handle crude oil with YPF. We have worked with them in full harmony, and the project has been delivered. It is a privilege now to work with YPF and its partners in such an important development. So thank you, YPF. Now, you know, after, I don't have to talk about Hassi Messaoud, because I've already talked.
So I'll leave the floor to Eduardo, who will give us insights on TR's performance and financial numbers.
Okay. Thank you. Thank you, Juan, and good morning, everyone. I would like to talk now about our delivery. For this purpose, I have selected four projects, most of them close to their end, in which relevant milestones have been achieved. The first project is Project ONE for Ineos. This project was awarded to TR in 2022, and it is the largest undertaken by Ineos in its history. Moreover, it is also the largest capital investment made by the European chemical sector in the last 20 years. So a big one. The plant, which is built in the Belgian port of Antwerp, will have a production capacity of 1.5 million tons of ethylene per year, and its startup is scheduled for 2026.
This ethylene plant is obtained from ethane, making the process much more energy efficient and environmentally sustainable. The scope of this contract, as you know, included project management, engineering services, procurement management, and construction supervision services, and as you are aware, it is built on a modular strategy basis. 21 modules are to be made in Abu Dhabi and to be sent to Antwerp in nine shipments. Well, the milestone is during the last months of 2024. The first two shipments were sent and have arrived to Belgium on schedule, and finally, this project, in addition to the enormous complexity associated to the size, the logistics, and the advanced technology, has also represented a milestone in the digital transformation of the company, as it is the first project in which a digital twin is fully developed by Técnicas Reunidas.
With regard to the received upgrade project we are executing for our client, ExxonMobil in Singapore, the aim of the project is to convert fuel oil and other crude products into higher value lube base stocks and distillates. The mechanical completion of the project is expected in the first quarter of 2025, and currently, we are supporting ongoing commissioning activities as requested by the client. We are extremely proud to announce also that to date, our teams have achieved more than 30 million of saved man-hours. The third project I would like to talk about today is the modernization of the Talara Refinery for PetroPerú. This project is one of the largest investments of its kind in Latin America within the energy sector.
The new refinery has 16 process units, five packages of auxiliary units, and complementary services to liquid loading docks and 20, well, it's a huge project. The modernization involves the production of high-quality diesel and gasoline fuels in accordance with stringent environmental requirements. And we are proud, and that's a milestone, we are proud to confirm that 100% of the milestones required for the plant startup were achieved while all units were successfully delivered. And the last project I would like to highlight is the project for SASA Polyester. A very good example of the massive PETCOM investments that Turkey's companies are driving ahead. This PTA project was awarded in 2021 under an EPCM service contract. And today, our engineering and procurement work is fully completed. Only construction supervision services are to be finished.
As of today, most of the facilities that integrate the plant are already in operation, and the two final units are expected to be delivered during 2025. Before leaving this operational performance sector section, I would like to devote some time to elaborate about how we see Técnicas Reunidas positioning in a changing U.S. market. We all know that policies implemented by the new U.S. government are very focused on the use of conventional energy, with an important deregulation and a fierce protection of domestic energy sources. This increased reliance on conventional energy resources will imply significant growth opportunities in sectors such as LNG, petrochemicals, upstream oil and gas, and gas-based power generation. In summary, those sectors where Técnicas Reunidas has a solid track record and the recognition of the client and the recognition of the market.
Also, during the last two years, we have entered in the U.S. with small-sized projects, and we have had the chance to show to the main players our capacities, our capabilities as well. We are also well-known by relevant U.S. clients for whom we have executed projects outside the U.S. If we put all those reasons together, I think it's not very challenging to expect a significant growth of our operation in the American conventional energy market. But also, regarding investments in energy transition, we still see coming a number of potential projects, since relevant European off-takers for this energy are still going ahead with their projects, and many opportunities for carbon capture, well aligned with the U.S. government policy, will be awarded soon.
We currently have, well, the consequence is we currently have a pipeline of opportunities in North America that amount to more than $20 billion, where service contracts will continue to be TR focused. Let's now take a look to the P&L and the balance sheet. The sales of the fourth quarter amount to EUR 1.2 billion, bringing 2024 sales up to EUR 4.5 billion. On a yearly basis, sales have grown 8% versus 2023. Annual sales have finally reached a cruising speed and will continue to increase in the coming years thanks to the record backlog we currently have. Our EBIT for the fourth quarter is EUR 50 million, and the total amount for the year is EUR 181 million. This figure represents a growth of 16% versus 2023.
The overall margin over sales in the year stood at 4.1%, which improves slightly our guidance for 2024. But finally, it has been a year of significant growth, both in sales and margins. And if the P&L improves, balance sheet figures have to improve as well. That is why TR's net cash figure has grown 46 million EUR up to 394 million EUR at the end of 2024. You can see that in the left top chart. This improvement has also allowed us to reduce 62 million EUR our gross debt.
And now I know I may sound boring and repetitive when sending my next message, but regarding CAS, we still believe that, and I want to insist that under the actual market scenario where clients demand us to accelerate the projects, the wise way to use the CAS is not to accumulate it in our balance sheet, but to pass it to our suppliers and allow them to execute projects smoothly and faster. I'm sorry to insist, but I think it's relevant. Regarding equity, we continue to reinforce it, and we have ended 2024 with a solid position of 575 million EUR. We are at pre-COVID levels, even without considering the PPL.
To summarize, I could say PPL and balance sheet figures, sorry, P&L and balance sheet figures reflect the good performance of all our operations, and we expect they will keep improving in the future years, as explained in our Capital Markets Day. One final slide, important one. The good health of our balance sheet allows us to go on repaying SEPI loans according to the schedule agreed. In fact, this month of February, we have repaid almost 50 million EUR corresponding to the second installment of the ordinary tranche. But in addition, we are planning to evaluate the advance repayment of a part of the remaining loans next September, once we have closed mid-year net cash figures and with a better understanding of what is the level of equity requested by our clients to go on growing.
And now I'll leave the floor back to Juan for the final remarks.
Okay, you have here, hello everyone again, you have here slides with the messages for my closing remarks, and every time I look at it, I change my mind of what I want to tell you. So I'm gonna just summarize in three messages that has to really, that I want to send to you. The first one is a message of thank you, thank you to shareholders, and thank you to our customers. The second message is a message of optimism, and the optimism that our plan or the strategy, it is being accomplished, and it will be accomplished. And the third message is a message of commitment. And let's, let's elaborate. Why do I have to thank investors and customers? And let's start by 2023.
May 2023, we were in the market asking our shareholders to support us, to strengthen our capital base. There was our capital markets, our capital increase, you know, in the market in order to meet the market and what, you know, that we were foreseeing that was coming in order to be able to deliver to our customers, for the customers who's asking us to deliver. We needed a strong capital base. That was a very important year, and that year I have to thank shareholders who backed TR that year, as well as customers with that stronger capital base entrusted us with very important jobs. That year, 2023, we committed to the market many things: sales, you know, awards, backlogs, delivery, everything has been done, everything has been achieved. With that, we have closed this 2024 as the first step.
During this 2024, it is a year of strategy. That was the year that we all sat together in Abu Dhabi and said, "We have a very strong strategy for 2028." With the milestone in 2026, that is a 2028 strategy. We have the opportunity to grow healthier in a, and, you know, convert TR in a much stronger company. And it is happening. It is happening. That is strategy 2025, 2028. It is, and I think it's understood, you know, it can be understood through this presentation. It is already happening. And the message of TR's team is a message of, of optimism. That is strategy has a milestone, as we said before, and that milestone is 2026. And that's the day, that's the year that will for sure repay SEPI and will be, will bring TR back to dividend policy.
So it's a message of commitment, commitment to bring value as we already are to our shareholders. So with these three messages, thank you, optimism, and commitment, I'd like to finish the presentation and open the floor to questions and obviously answers the best way we can. Thank you very much.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. If you do wish to ask an audio question, please press Star 1 on your telephone keypad. If you wish to withdraw your question, you may do so by pressing Star 2 to cancel. Once again, please press Star 1 to register for a question. Your first question comes from the line of Mick Pickup with Barclays. Please go ahead.
Good afternoon, everybody. A couple of questions if I may.
Firstly, I don't think I saw it in the presentation, but can you just talk about the volume of services in the mix? Obviously, that's a key element in the 2028 margin story. And secondly, just looking at your divisions, low carbon tech went up to EUR 130 million. That's a phenomenal growth. Well done. And margins are now above 20% in that business. Can we just assume that that business continues to grow at this sort of rate and that the margins now, that's the type of margin we should be looking at the business?
Hi, Mick. Good morning here in Madrid. I was waiting for this question. I don't want to say I did it on purpose, but I knew I have not reflected any results regarding the services division. And there is a reason behind.
When I was in Abu Dhabi in the Capital Markets Day, I tried to convince you all that, well, there was a clear ramp-up in this activity to come in the year 2026, 2027, but I understand it's impossible for you not to make that question, and you need to know where we are today. Most of the services we have rendered this year has to do with the low carbon technology. So you know well what's the figure because it's in the account. But there are also some other projects that have to do with the more conventional energy. They are not that relevant. I think Abu Dhabi, I told you we were really around EUR 150 million this year of services, and we are not far from that.
As expected, the profitability, the margin is around 30%, slightly below 30%, but it's very slightly. We have done what we expected, but what was relevant for this year 2024 was to construct, first to open the markets. You know, there are many, many clients that they still see us as traditional EPC companies. It has been tough to convince them that, well, allow us to participate in other kinds of projects. I think we have been quite successful because I think the figure, what is relevant for us, that we have constructed a backlog of services to be delivered in the next year and a half, give or take, of 300 million EUR. This is the good news, no?
We have a very solid backlog for next year, and regarding the energy transition world, I think Joaquín is with me and probably we can share the answer, but the first answer from my side is, it is a fact, the energy transition is not moving as fast as we expected probably a year and a half ago, but it's still delivering good results for us, and the numbers are there. So if we talk about the world of services, feasibility studies, FEEDs, pre-FEEDs, the kind of services we are rendering now, I do not see reasons to believe that they cannot go on growing in the short term. What still is difficult for me to predict is when the big final investment decisions are to come. That's my main concern.
Probably Joaquin, if you want to add something.
Let me add, Mick, that yes, I think that we're still working in very good prospects here in the low carbon business, okay? Let me say, for example, that last week we were awarded grants for several projects here in Spain, and we are more than well positioned in most of them, okay? I think this is something those projects are going to move ahead, and we have our chances there to work on building these low carbon projects here in Spain, but also we are working in prospects in Northern Europe. We are working in prospects in the US. We are reaching agreements with good companies to do joint business development efforts in Northwestern Europe.
So I think that the mood, it seems that now everything is demonized with decarbonization, no? But it is not when you speak with strong and solid players. I think they are moving ahead strongly and steadily to build a position, and that's what we are doing. We're working on that, and we see growth. We definitely see growth in this business.
Okay. And can I just follow up on that? You mentioned in one of your slides you're still seeing low carbon in the U.S., which is good to hear. Have you seen any low carbon in the U.S. disappear?
Well, let me say, in the projects that we are working on, okay, maybe the one that could be more threatened is the one that is related with green ammonia, okay, or green products, okay?
But blue products, for example, blue products are on the way. We are still working in blue products. In fact, we are currently doubling our bet with some of the projects that we are working on in the U.S. that are related with low carbon ammonia, with the blue ammonia. And so, everything that has been seen in the presentation related with carbon capture, I think it's solid. It's solid in the U.S., and in the state that we are working, even more.
Perfect. It's nice to hear you saying the same as everybody else.
The next question comes from the line of Kevin Roger with Kepler Cheuvreux. Please go ahead.
Yes, good afternoon. I have a few questions, if I may. The first one would be on the commercial dynamic.
So you have been very successful recently with already quite a few billion EUR of orders, which probably allow you to increase a bit the guidance in terms of top line. How do you see the commercial dynamic for the coming months and basically where you think you can land for the full year 2025? Because you usually say that you were expecting kind of book to be in around one with what you have secured already. It seems that it could be very easy to get those levels. So just trying to understand what you can expect in terms of award, what you do see in terms of proposal, etc., for the coming months. And the second one, it's maybe early, and sorry if I missed it. I was a bit late on the call, so sorry for that.
But regarding the strategy, on the PPL, is there any update here on where you think that it will be the good time to reimburse it? Is it something for 2025 to be able to pay some dividends to, to shareholders, or for you there is no rush and it's more of a 2026 story? So any, any comments here, please?
Okay. Kevin, this is Juan. I'll be the one, you know, with one after the other. The first answer was from Eduardo. Now, my time. It's true that we've been successful in this 2025. Contracts still need to be signed, but we are being successful.
Let me tell you, the feeling that we've got is today, 2024, 2025, the TR franchise. I mean, the quality of franchise, that's by the way customers come to see us and demand our services is much stronger than it was in 2019. I mean, I'm going as back as 2019. We're a much stronger and far more prestigious house. They call us for transition energy. They call us for very big onshore and offshore gas development. You've seen that we've been called for urgent and important, you know, traditional combined cycles, in this case, power developments. They call us for services. We're strengthening our service division, and we presented ourselves as a very strong engineering house, which is, in fact, what we are. We do believe that 2025 is going to be a good year.
It is always difficult to say by how much because this business, it is bumpy in terms of awards. If it was three years, we can tell you that we were very comfortable that we're going to be meeting everything that we said in the capital market day. But in the next 10 months, it is, it is very difficult. It is extremely difficult. My message is optimistic. Optimistic. It shouldn't be a challenge, as I said, more or less at the same time last year, to have all of the intakes to replace ourselves. It shouldn't be a great challenge. But you have to keep in mind that, you know, we are selective. We like to work with the customers that will, you know, assure us a good future, that and with good customers, one. And two, we're developing our service division.
Three, we are, and sometimes that reduces the volume of our revenues, sales, and order intake. We are, we continue putting in place risk management or risk reduction measures with partners in our awards. But the message is optimistic, okay? Very, very optimistic. The strategy of PPL, the strategy of SEPI, I mean, that is in the schedule. The schedule is to be repaid in 2026, and that's going to get done. I mean, that's what we have said it, you know, since last May, every single time we have met. And I think we have stressed it here, three or four times in our presentation between Eduardo and I. But listening carefully to Eduardo's message, you know, by the third quarter of this year, and we have to value it.
You have to value it both commercially, what is our required net worth for the jobs that we are bidding, our capacity to issue performance, and whatever. Putting everything in the balance by the end of this year, third quarter, will value whether we could anticipate the repayment of the PPL. But, we're not saying a yes or a no. We, I mean, it has to be explored, you know, and this business is a moving target, and it's always, and we'll take a decision then. Sort of, the message is the message of comfort. 2026 is a yes.
Okay. Understood. Thanks.
Thank you very much, Kevin.
And your next question comes from the line of Ignacio Doménech with JB Capital. Please go ahead.
Yes. Hello. This is [inaudible] . Thank you for the presentation.
I have two questions. The first one is, it's related with the commercial activity, no? It seems that it will remain strong, okay, for the coming months and years. So I was wondering, how do you feel about the current structure, no? Of the company in terms of pursuing, no? All of those opportunities. Do you think the structure is appropriate, okay, to pursue all of those opportunities, or you will, or you would require, no? a change, no? On the capital structure of the company. And still related with these questions, I was wondering on the balance sheet, okay? It seems that both gross payables and receivables remain elevated. However, they're actually down compared to other years, no? When we have a percentage of revenues.
So I was wondering what would be a reasonable target, no? To assume for 2025 and 2026 in terms of the working capital. Thank you.
Ignacio, I'll go through the first question, and Eduardo will answer the second one. If you ask me about my feeling regarding our current structure of the company, I think we presented to you, we presented to the market a year ago, and we have a. I mean, we're much closer to the customers than we have ever been by far. So I think I do believe, not only because of the structure, but because of the talent of the professional, that we have one of the best structures, setups, and professionals in Europe.
You can see it on the results, and you can see the way we have recovered all the intake awarded and, very important, delivered, which is, you know, the three, the messages that we wanted to put through these presentations. I think we have a. We're working to be, you know, we always have to work to be better. We're always revising our structure, but we do have a structure organized, you know, with the regional CEOs that allow us to be much, much closer to our customers for both commercial and delivery than we have ever been in our history.
Okay. Regarding the balance sheet, Ignacio, you are pretty right. The accounts payable and accounts receivable have grown, but it is a fact that they have grown exactly in the same way the revenues and the procurement has grown.
I mean, I think it's around 9% growth in sales and revenues and procurement, and the accounts receivable and payable have grown around 8%. So there is a direct link between both of them. I think there are a couple of issues that have to be borne in mind for the forthcoming three to six months. First, we are about to close three or four big projects, and I do really believe that once we close the projects, the amounts of the accounts receivable because of the final withholdings with those clients, plus the money we are going to pay to the suppliers, will reduce somehow the volume of accounts receivable and payables.
But also, and simultaneously, it's a kind of surprise because the volume of awards of the last period of the year has been huge, but the volume of down payments received has been quite small. Well, no, zero, because there is no down payment coming from. No down payment coming in 2024 from the Hassi Messaoud project and for the combined cycles in Saudi Arabia. All this money is to come together with the money from Vaca Muerta in the forthcoming 45, 60 days. So I don't know if the money will be in the balance sheet of TR by the end of March or will come later. But, you know, we will see a significant change in the figures, probably next March and for sure next June.
I do believe the figures will be much better. That's my what I anticipate.
Okay. Thank you very much.
Your next question comes from the line of Alvaro Lenze with Alantra. Please go ahead.
Hi, thank you so much for taking my question. The first one is on your approach to new tendering. You, as colleagues have mentioned, order intake has been very strong early in 2025. I was just wondering whether you have the capacity to go to order intake levels like EUR 6-8 billion or whether that is out of the question and you would instead opt to remain at EUR 4-6 billion as a maximum and try to be more selective in terms of profitability.
Or, contrarily, maybe if you don't have the capacity, maybe you can invest to increase your capacity and be able to integrate order intakes to the tune of EUR 6-8 billion. And then my second question is, sorry to come back again to working capital, but I struggle to reconcile the numbers and the messages because you mentioned that you are trying to approach working capital in a way that you collect from clients and then accelerate the payments to suppliers in order to have operations running smoothly. But then you said in the previous question that the balances of accounts receivable and accounts payable is growing in line with sales. So I find that message kind of contradictory.
I would expect both accounts receivable and accounts payable to fall both in relative terms to sales and also in absolute terms. And maybe if you could quantify a little bit on those three, four clients to be closed in the coming months because if I go to your annual accounts, it seems that the cumulative revenue from projects that are pending delivery has climbed by EUR 4 billion and now stands at some EUR 29 billion, which is six times your revenue. And that seems like you have a lot pending to deliver. Just trying to gauge whether there is any risk there. Thank you.
Okay. Now, Alvaro, we'll go through the first question, and Eduardo will follow with the second question. The first question is about, do we have capacity? The answer is yes. But let's have it very clear.
I mean, if the market would give us the opportunity to grow because we do have the capacity, we have a strengthened engineering capacity over the last, you know, three years. You know, we've been ahead of the market, a strengthened engineering capacity. You know, the important thing with launching new jobs is to have project directors, project managers, and then the capacity to put together a large and diligent task force of engineers. That's why we always announce the minimum of hours, the number of engineers. We do have the capacity. We have grown in Spain. We're growing in Abu Dhabi, in Saudi Arabia, and in India. We do have the capacity. But let me tell you, we'll grow if the market will allow us to grow within the limits we have imposed ourselves, limits of risk management and profitability.
We haven't got the capacity, or we will not use the capacity to grow for the hell of growing. I mean, that's not our target. Our target is to grow within the profitability and risk management that we have very much imposed and announced to the market. And I think that's an important message.
Yeah. Regarding the working capital, Alvaro, I would be very pleased to meet you one day and to enter into details. Well, Antonio says that he prefers to do it. Okay. You can do it, Antonio. But let me, I think my logic is clear. If you have bigger sales, if the time you take to collect the money is the same you had in the past, the immediate consequence is that you have bigger accounts receivable. And it works the same with accounts payable.
So if you are bigger, it's quite common that your accounts receivable grow. Saying so, more than happy to sit by your side and help you to understand all the details of how the working capital works. I think it always makes sense to revisit how we collect the money from our clients. That's important because there are two critical issues, especially if you work in the Middle East. The first fact is that according to the milestones or the way of collecting the money that comes from the milestones that have to do with procurement, you always develop a lot of work that cannot be invoiced to the client until the equipment arrives to the site. So that creates a massive volume of accounts receivable, which is not that common in other geographies. That's first.
And second, as I have mentioned before, it's also common that the clients used to withhold a percentage of the total value of the contract that is released at the very end of the project. So when you are very close to the end of the project, you have accumulated a relevant amount of these withholdings that once you recover, they go directly and they are passed to the suppliers because we also have those withholdings with our suppliers. So, I know the figure is huge. I'm not happy with it, but it is the way the business works. And again, very happy to sit with you and to explain anything you may need.
Thank you. That's helpful.
And I will take your word on that. And hopefully, we can sit in the future to discuss this in detail. Thanks.
And your next question comes from the line of Francisco Ruiz with BNP. Please go ahead.
Hi, good afternoon. And thank you for taking my question. I mean, some of them have already been answered. Perhaps there's a follow-up on the mix. I mean, the big jump that you are expecting or the first big jump that you're expecting in terms of EBIT margin for 2025, could you tell us how much is coming from the mix? I mean, higher service activity versus EPC, and how much is margin expansion on the EPC business itself?
The second one, if we look at those costs which are not attached to the project, it has shown a big increase in 2024, more than 20%, if I'm not wrong. Could you tell us how you expect this to continue in the future? And last but not least, Eduardo, you have already commented on this working capital issue that you prefer to accelerate the project at the beginning of them. But you haven't said anything about what's your cash estimate for 2025 as it used to be the case in previous years. So what's your thought on cash for 2025? Thank you.
In the line.
But let me answer you the first and the third question because we have missed the second one. We couldn't understand it. But let's start with the jump in the margin. I think when I was in Abu Dhabi, I was clear. There were two reasons driving the growth of the margin. The first one has to do with, yes, we have to have a bigger service division with better margins. That's a fact. It will happen. And by 2025, I have told you we already have a backlog of EUR 300 million. The services are to be delivered in the forthcoming two years. At least today we have EUR 150 million in our backlog to be delivered next year with a good margin.
But also I think the EPCs are in a good shape. It's a fact that we have to be conservative. We have learned a lot from the past. And if we see contingencies to be released, we would prefer to retain them until the very end once we are pretty sure that there is no risk of any final deviation. So we will see how EPCs are delivering better margins, but we are not going to get crazy. We want to be conservative. So I would say the growth in 2025 mainly has to do with a more solid delivery of services and a sustainable margin around 4 plus in the EPCs. And regarding the working capital, what's my cash estimate for 2025?
You know, for me, that's a tricky question, you know, because I have told you many times that if you have asked me what was going to be my cash by the end of 2024, I would probably say EUR 600 million instead of EUR 400 million. Why? Because, you know, the down payments come in, you know, always have a huge impact in my accounts. I know that the EBITDA of the year 2025, give or take, should be converted into cash by the end of the year. That's probably the best guidance I can give you.
I don't know if it's going to happen in 2025 or in 2026, but what is clear to me is that the conversion should be full from EBITDA to cash because, well, our taxes, since we have tax credits in Spain, we pay very little cash for taxes outside Spain. And, you know, the financial costs are there, but since we are going to reduce the burden of the loans we currently have, you know, they will be smaller as well. So give or take, the conversion of EBITDA into cash should be the improvement of the cash by the year at year. And, but everything will dramatically change because of when the down payments are going to be collected.
Sorry, sorry again. I insist every quarter, if I have cash, the cash is for my suppliers. It is the way to do the projects. If the cash is for the investors, I'm afraid I'm not doing the correct things. So, I will try to use that cash wisely.
Very clear. My second question was on the costs which are not assigned to the project. I mean, you have a table in your result that said, I mean, contribution margin and then costs which are not assigned to the project, which has grown more than 20%. It's, I mean, I don't have the figure in mind, but I think it's something like around 100-something million euros. So I don't know, probably this has to do with central services.
So, my question is, how do you see this evolving in the coming years?
Again, I'm sorry, I have to make some numbers to say it's 20%. Probably you're right. But the company has grown 10%, and there has been an inflation of 5% or 4%. So, almost everything has to do with the growth and inflation. But I will tell you something. That's one of the areas I'm more focused in. You know, every meeting with the board of managers here in Técnicas Reunidas, sorry, with the executive committee, one of my main messages is I don't want this figure to go on growing because it is very easy in the actual scenario of many potential opportunities coming to spend more money than needed.
So I am very focused, and you are right when you talk about it. I'm on top of it.
Okay. Good to know. Thank you.
Thank you. And I'm showing no further questions at this time. I would like to turn it back to the management for the closing remarks.
Okay. We are done with the year-end results presentations. Thank you very much to all of you for attending this webcast. Thank you for your questions. And have a good weekend because it's Friday. Thank you.
Thank you, ladies and gentlemen. This concludes today's conference call. You may now disconnect.