Hi, good morning, everyone, welcome to TR's full year 2025 results presentation. It's gonna be conducted, as usual, by our Chairman, Juan Lladó, and our CEO, Eduardo San Miguel. It will last approximately 25 minutes, You will be able to pose your questions after our final, our Chairman's final remarks. I now leave the floor to our Chairman, Juan Lladó.
Hi. Hello, everyone. As usual, as Antonio have said, Eduardo San Miguel, and I will guide you through these most relevant points that we're gonna be covering in the presentation today. I will first walk you through the main financial and commercial milestones that we have achieved by this 2025 year. All of this will be very much enhanced by Eduardo with much greater detail and color. Eduardo also will continue with the financial section of the presentation, and finally, I will conclude with some financial remarks. Thank you. Here, this is different than other presentations. Let's start, which I think is a real highlight, with the financial performance of TR. Financial performance in 2025, which has been extremely solid and has definitely exceeded all initial expectations from the very beginning of the year.
As shown in this slide, 2025 sales reached EUR 6.5 million, representing 45% increase compared with the 2024, therefore exceeding the guidance set for the year. If we move to the EBIT level, 2025 reached EUR 291 million, which is 61% above 2024, which results in an EBIT margin of 4.5%, very much complying with the guidance established for a year. Nevertheless, that's important to note as well, we gain, in nominal terms, EUR 57 million above our initial goal, which is due to the sales increase. Finally, net profit amounted to EUR 156 million, reflecting an increase of 75% compared to the previous year.
After these results, this performance, it has resulted, as you all were well known, in early repayment of our SEPI loan, which finally took place last December 1st. This repayment of the loan has given us the financial flexibility to return to the shareholder remuneration policy. We're giving payments, resuming again this 2026 year results. This is new, as we never start with guidance. With these solid financial foundations, I'd like to anticipate our guidance for 2026. We do expect sales to exceed EUR 6.5 billion, with an EBIT margin above 5%, which translate into more than EUR 325 million. Our guidance for net profit is projected to reach the neighborhood of EUR 200 million.
It is important to note that the EBIT grows by more than 10%, from EUR 291 to more than EUR 325. It is also important to see that net profit increases as well by more than 20%. However, this 2025 has not only been a year of outstanding financial results and very good execution and performance. Probably, I think it is more important that 2025, it's important to say and to explain to all of you, has been a year of quality, of positioning, and has been a year of a real inflection point. In 2025, we have managed to place TR where we wanted TR to be. Let me go through why. First, we position TR as a much stronger company in the Middle East. Second, with the leadership in the Power business.
Third, confirming TR as the trusted engineer service partner. Four, and this is very important, a very strong foundation in North America. Before Eduardo gets into details, let me give you some examples. On March 25, it was very well announced, we got the award of the Lower Zakum project for EUR 3.1 billion. We have been present for more than 20 years in the Middle East, now today, I can confirm that we are positioned better than ever. We have strengthened this year, our leadership in the Power business. We have a strong backlog, with the expansion of the combined cycle in Saudi Arabia, together with the new job for RWE in Germany, we talk in Saudi Arabia, and we talk in Germany. That confirms that we are in this business well positioned to grow.
Our engineering service has closed in 2025 with awards of EUR 333 million. This is remarkable. This is a remarkable milestone that was defined only two years ago. Most important, and very important, is that of these EUR 33 million, more than 70% has taken place in North America, which confirms our quality and definitely our growth potential. All I wanted to do this introduction, our financials, our guidance, our positioning, and now I pass the floor for Eduardo to continue with the presentation.
Okay. Thank you, Juan. Good morning, everyone. As Juan has explained, year 2025 has been a year plenty of solid achievements. Repayment to SEPI, best ever EBIT. We're filling the backlog with a strategic new project, but there is also a deep transformation process inside TR moving forward that supports these achievements and is slowly reshaping the future of Técnicas Reunidas. There are a number of drivers for this transformation, but I want to focus on four of them. First, expansion of our Services business line. Second, our new strategy for the Power division. Third, the leadership we are settling in digital, artificial intelligence, and robotics. Fourth, our presence in the geographical areas with the highest concentration of future investment.
I will cover in the next slides where we are in those four drivers, but let me first devote this slide to explain to you why it is a real game changer. Expansion of the Services business line obviously delivers a volume of profitable and less risky projects, but it is also the way to enter into the U.S. market and to keep on working in the world of energy transition. The new strategy for Power, that has to do with the spin-off of our power unit, that we expect to be completed before summer, well, you know, has a purpose, and this purpose is to maximize the opportunities for this sector, based on more resources devoted and more focus. Through investing in artificial intelligence, digitalization, and robotics, we will get cost efficiencies. We will increase our competitiveness, and we will generate opportunities to deliver digital services.
Most importantly, it will contribute to redefine how our clients perceive us. Eventually, to complete our footprint with a solid presence in the U.S. was a must last year if we wanted to capture immediate future investments. We have succeeded in consolidating our presence in the States. Together with the Middle East, we are where we want to be. Let's go one by one. First, the engineering services business line. 2025 figures are good and also promising. EUR 333 million in awards, more than 40 new contracts signed. A total of 11 frame agreements signed with major clients. 23 new clients we have started to work with through this business line. The revenues amounted to EUR 254 million, halfway to our 2028 ambition of EUR 500 million of revenues.
Our margins are in the range from 25% to 30%. It has definitely been a very good year. Second, artificial intelligence, digitalization, and robotics. We launched months ago a project called Reimagine TR, our conclusion is we can fully transform the way of doing projects. It will take time, in the meantime, it's an unlimited source of cost efficiencies. What is clear to us now is it is time to invest, we will do it. That is why we have decided to increase our investment up to EUR 35 million per year from 2026 and onwards. That is why we are planning to more than double the staff devoted to develop our programs. More than 400 people will be involved in digitalization and robotics by the end of 2026.
Also, this investment will be partially paid by the clients because digitalization is becoming a source of services contracts with our clients. In fact, we have already contracts amounting EUR 65 million and another EUR 50 million under negotiation. Regardless, it is paid or not by the clients, digitalization or robotics are definitely a game changer in our sector. From civil works, structures, electromechanics, procurement, site, and project control, everything can be digitalized. In fact, around 60% of the man-hours in our sector can be automated with today's technology. Our internal estimation is we can capture EUR 200 million per year in cost efficiencies. That will be translated into better margins or more competitiveness, depending on the market situation. In any case, we will invest. We have to be ready for the future. The third driver is the power sector.
$100 billion is expected to be invested annually by our clients next decade. We have a business unit that has installed 25 GW in the last 20 years, creating a unique relationship with the four existing turbine suppliers: GE, Mitsubishi, Siemens, and Ansaldo. In our October Investors Day, we fixed our target of revenues in EUR 1 billion per year. It is not a major challenge considering the size of the market. To secure the achievement of this target, last December, we launched the spin-off of this business unit, and we have created TR Power. The new logo is up there in the slide.
With more resources, with the sole focus in constructing combined cycles moved by gas turbines, with fully separated financial accounts, with an identity distinct from TR that allows clients to better identify TR Power management team, we firmly believe the achievement of our target is closer. Eventually, the fourth driver is to consolidate our presence in the most promising markets. You have some numbers in the slide. They have been provided by McKinsey in its Global Energy Perspective. They may be slightly obsolete because they come from 2024, but it is an undisputed fact that a very relevant portion of the global investment will take place in North America, mainly in the U.S., and in the Middle East. Regarding the Middle East, TR has strengthened the last two years, a position that was already important in itself. We are developing local engineering services.
We acquire equipment that is exported all around the world. We construct workshops to build robotic solutions, we use it just to construct modules used in other geographies. We are executing massive projects in terms of size and the most advanced projects in the world of the energy transition. All those are very good reasons to be optimistic in the Middle East. A vast pipeline amounting EUR 35 billion is ahead of us the next 18 months. For North America, 2025 has been a year of consolidation. The strategic framework agreements with the different energy players are already leading to significant results, with more than EUR 70 million in services awards in 2025. Furthermore, these engineering services will allow us to access to EPCs, where the pipeline of opportunities in the next 18 months stands at more than EUR 24 billion.
Without any doubt, the recent alliance signed with SACDE will enable us to grow faster and solidly. Obviously, the volume of investment in power generation driven by the artificial intelligence will provide us a number of good opportunities this year. These are the four main drivers. Now, let me elaborate about the financial figures of the year, although Juan has already given a glance of them. We closed this last quarter of the year with sales of EUR 1.9 billion. This represents a 52% increase compared to the fourth quarter of 2024. This strong sales performance reflects a healthy delivery of our backlog, the acceleration plans currently being implemented across our Middle East projects, and the continued growth of the Power business. I mean, for the last quarter, reached EUR 86.6 million.
This represents a 74% increase versus the fourth quarter of 2024. EBIT margin reached 4.6%, making the 13th consecutive quarter of margin expansion. EBIT margin, obviously, is being driven both by the healthy backlog I mentioned before and the expansion of our Services business line. Finally, let's now take a quick look at two key figures of our balance sheet. The net cash position at the end of 2025 amounted to EUR 332 million, reflecting the impact of the early repayment to SEPI. Without this repayment, the year-end net cash position would have totaled EUR 507 million, compared to EUR 427 million we had the year before. Regarding equity levels, we ended 2025 with EUR 564 million, a very robust figure.
This is why, and after repaying SEPI loans, TR will resume its remuneration policy, committing to a 30% dividend payout against fiscal year 2026 results. A final decision about a potential interim dividend will be made after summer. Let me give back the floor to Juan for his final remarks.
Thank you, Eduardo. Let's now finish, say that 2025 has been definitely a very strong year. A year our transformation has reached, as we have both said, Eduardo and I, a true inflection point. We have set the foundations for growth and profitability. Today, we have product, we do have quality, and we have to strengthen very much in regions and markets, and very important, very talented resources. In this sense, and that's what I said before, for 2026, we can forecast revenues over EUR 6.5 billion, but as I said before, EBIT to exceed EUR 325 million with a margin above 5%. I'd also like to note that it should not be a great challenge to end 2026 with EUR 6 billion of new awards. It's not a great challenge, but it is a challenge.
It's not a great challenge. EUR 7 billion of the awards.
You said EUR 6 billion.
I said EUR 6 billion? Well, I was a Freudian slip. EUR 6 billion. No, EUR 7 billion, EUR 7 billion, EUR 7 billion. That may give you the hint that EUR 6 billion is very, very easy. I mean, we target for EUR 7 billion, and we, you know, usually we always have that question, and before you ask us that question, we decided to tell you know, we are targeting for EUR 7 billion of new awards. Let me finish by saying that TR transformation is really moving forward. I am optimistic, very optimistic, because our future has never been and has never looked more promising. Thank you very much, and now we are here and ready to answer any questions that you may want to pose.
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 one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing star two to cancel. Once again, that would be star one to register for a question. Your first question comes from the line of Ignacio Doménech with JB Capital . Please go ahead.
Hello, good morning, Juan and Eduardo. Thank you very much for the presentation, congratulations on the results. I have two questions. The first one is on the EUR 7 billion awards, now expected in 2026. I guess you have a high degree of visibility on this. I was wondering if you could give us some color on the split of these awards. Maybe what would be the weight on services versus ETC? Based on the performance, now that we've seen in 2025, with some of your clients requesting to accelerate some of these projects?
Given this EUR 7 billion of awards, if you think that 2026 could follow a bit the same path, no, the same trajectory we've seen in 2025, potentially, the outlook that you have guided, no, for 2026 could end up being revised, no, throughout the year. The second question that I have is related with Teesside. I noticed on the annual report that the final decision, no, is expected in 2026. I was wondering if you have some visibility there or any detail that you could provide, okay? Thank you very much for the questions.
it's good to know that you have realized it's EUR 7 billion after the competition. I have to be honest to you, I think we have a quite good clear visibility about those EUR 7 billion. First, because everything that has to do with power is booming. We are involved in a number of projects. We have already, in fact, been awarded with some projects that has to be converted now into EPCs, and it will happen probably by the end of the year, early 2027. a relevant part of this EUR 7 billion will come from the Power division, and there is no major doubt about doing that, achieving that part of it. regarding the traditional businesses, oil, gas, petchem, LNG, again, I think the visibility is quite high. We are already involved.
In fact, we are already bidding for very relevant large projects, mainly in the Middle East. You know, the perspectives are very good. We do really believe we are offering competitive prices. We are doing the kind of projects we are experts in. We have the recognition of the clients. To be honest, it's always a challenge to convert all our expectations into reality. Being honest, we believe that the visibility is very clear for those EUR 7 billion. It has to be done, obviously. Regarding 2025, that guidance is low. Yeah.
Yeah, I have to accept that this year we may look a bit conservative providing guidance because we have beaten three times in a row our previous guidance. We are trying to be fair with the figure we are offering you for next year. I think to reach this EUR 6.5 billion of revenues. We may be slightly above if everything goes right. I think for your estimations, your numbers, EUR 6.5 billion, EUR 6.5 billion is a correct number. We have missed the last question because we believe you are thinking about dividend. Is this correct?
No. No, it's on the decision on Teesside, on the litigation, but I think the date is on the first semester in 2026. Just wondering if there's any you have any visibility there or anything that you could share, okay? Any potential upside there or?
We are positive about the final outcome of this arbitration, but I've been giving that message to the market for a long time. The only visibility we have now is, it is expected to have a final outcome next April, end of March. That's very confidential. I cannot enter into more details.
I understand. Thank you. Thank you very much for the questions.
You're welcome.
Thank you. Your next question comes from the line of Kévin Roger with Kepler. Please go ahead.
Yes, good morning. Thanks for taking the question. I'm very sorry you're gonna tell me that I'm a bit pushy, I wanted to get your sense on the post-2026 linked to two elements. The first one is that you have a backlog today of more than EUR 10 billion. That provides you a lot of visibility for 2026, you're gonna use a lot of volumes from those from this backlog, EUR 6.5 billion on the year, 10 something. You're gonna get a lot of volumes that will materialize as soon as this year.
I was wondering if you can share a bit with us, how do you see really the order intake trend for the next, let's say maybe, six months, and that can contribute to the 2027 top line, and then the chance and the rationale to keep the 2027 top line flat, or you do see, you know, maybe some risk on a slow, on a slightly lower top line in 2027 because 2025 and 2026 have been, at the end, very, let's say, well above your expectations. Just to understand, you know, a bit the phasing of the order intake and how it can contribute to the 2027 top line. The second one, it's maybe focusing on the power generation business.
You have announced the spin-off of the entity. You do announce that the commercial pipeline is relatively huge in that space. If you can share also a bit with us, you know, the kind of region, I guess, from the re-U.S. that matter and the typical size of the project that you are chasing there. Thanks a lot.
Hi, Kévin. Thank you for the questions. Well, it is math. I mean, we know the volume of backlog we currently have, and we know how we are going to deliver it throughout 2026, 2027. Give or take around 85%-90% of the revenues coming, expected in 2026, will be coming from the existing backlog, but there is still something to be done with the projects to be awarded within this year. When we say EUR 6.5 billion, again, please don't believe I am being conservative. It is really what we believe it will happen.
The good news is that if we will be delivering a small part of all the awards of the year 2026, within 2026, this means that most of the revenues will come in 2027 and onwards. I think we are well balanced, right? Well balanced. When we talk about the pipeline of Power, yes, the pipeline of Power is massive. Basically, I think we are focusing three geographies, and I'm not going to tell you nothing extraordinary. In Middle East, we see still new relevant opportunities, not only in the Middle East, but not only in Saudi, but also in the Emirates. We are bidding there, and we believe we have a real chance of being awarded with big, large projects.
The United States, well, it's what we expect. It's clear there are many opportunities this year. We've had a solid alliance with SACDE. SACDE is specialized between all their specialties they have. We are specialized in the constructing combined cycles. If the market is booming, our partner is a good constructor of combined cycles. Well, not only a constructor, because they are also engineers. You know, obviously, we should be having a very good opportunity this year in that market. You know, in Investor Day, we told you that we expect a project to be awarded before year-end or early 2027. We believe the first project, the first PPC, and probably it will be a power unit, is coming soon. Also, there are opportunities in Europe.
We are bidding in Europe. Well, you know, there are many opportunities. That's why we needed to create a devoted team exclusively focused in this sector, you know, because we don't want to miss any opportunity.
Okay, thanks. One follow-up, if I may. Services, frankly, you are quite very successful with EUR 250 million generated this year. What kind of growth do you target this year? Sorry if I missed that during the presentation, when you know, argue that you have an order intake of EUR 333 million in 2025, is it fair to assume that it will be the kind of top line that you're gonna get in 2026?
Hi, Kévin. It's not that easy because in the Services business line, we have little experience. We've been involved here for three years, no more than that. We will definitely grow, the starting point is 333. We are expecting to have EUR 100 million by 2028. I think this year we should be finishing close to 400, but below 400. I have to be honest, that's what we expect. It's difficult for me to give you a more accurate figure because, you know, this is not two big projects. It's maybe 50 projects of very different sizes, and when they are going to be awarded, end of the year, early 2027, is very difficult for me to predict. Slightly below 400 should be the target of awards.
Okay. Thanks. Thanks a lot. Have a nice day.
Thank you. The next question comes from the line of Mick Pickup with Barclays. Please go ahead.
Good morning. A couple of questions, if I may. I'll ask them one by one. Can I just talk about the new bits you started talking about? Obviously, the digitalization, the robotics was a big one, and you talked about 60% of hours in our sector suitable for automation, and that EUR 200 million saving, obviously big, big numbers. Can you just talk to what's in that? Is that your man-hours, or you're talking subcontractor man-hours as well, so robot welders, automated deliveries? How extreme have you gone to get to that EUR 200 million? On the cash side of it, the investment plan, EUR 25 million-EUR 30 million a year? Is that expensed or is that going to be CapEx going up?
Well, Mick, I have to be honest to you, when I was talking about EUR 200 million, I was conservative. The figure can go beyond that. Okay? When we were talking about reimagining here, we were thinking about let's change everything. When we talk about change everything, we were talking about the construction as well.
Yeah.
When I'm talking about saving 60% of man hours, I'm talking about everything, both engineering services, procurement services, and construction man hours.
Okay.
Yeah, the future is going to be very different to what we see today. For me to say to you, these EUR 200 million are directly linked to the engineering or the procurement, is a bit complicated because it's not EUR 200 million, it's more than that. There are potential savings in the whole chain. That's a fact. Antonio is in front of me, and he's telling me you to insist that cost efficiency doesn't mean savings over profit. It can be converted into being more competitive. We have to be very careful when throwing these figures because you may believe that, well, those guys are going to multiply it's digital way in the forthcoming three years, and it's not the case. We have those savings, and we have to invest on it.
Regarding if it's going to be CapEx or OpEx, I have to be honest with you, there are very clear accounting rules. Not everything can be CapEx. I mean, there will be lots of expenses that has to do with internal hours we will devote, that probably will not be converted into CapEx. For me, it's difficult to predict what percentage of those EUR 35 million will be CapEx, but my purpose is not to create a big ball of fixed asset called digitalization investments. No, the idea is, well, let's try how to find a way to balance it, and it's absolutely impossible for me to tell you today which percentage will be expense and what percentage will be CapEx. It will be a mix of both.
Okay. Then a second question on Power. Clearly, you talk about opportunity sets on Power and having good relationships with all the big OEMs for the turbines. All I hear from my cap goods analyst is that if you want a turbine, get in the queue, and you can have that turbine in 2030. How does TR get in that queue?
Sorry, there has been a little debate here inside about how to answer you, but I think what makes a difference is we are extremely reliable for the OEMs. They know us very well. When they have an opportunity, they ask us to be in the project. I mean, they call us. They want to be partners of them. Obviously, there is a competition, but when, you know, when you are with General Electric, and you are constructing simultaneously four projects with them, it is obvious that once they have awarded a turbine to any specific client, and if we are partners of them, for us, it's easier to be the awarded with the construction of the plant. You know, sometimes clients are asking us: Do you have a turbine for me?
No, we don't have a turbine for you. That's something you have to talk with the supplier of the turbine. You know, how the OEMs are pushing us, and they are offering us good opportunities all around the world. That's why, I believe this good relationship with them is so critical. We are not opportunistic. There are many local companies constructing combined cycles around the world, it's just one project. We have a track record of 25 projects in the last 10 years. Also, it's important, the Services division that also works in Power is involved in very early stages in the construction of combined cycles.
When you start early, you know, it's easier for you to be the final company that will construct the plant. There are many reasons to understand that being close to the OEMs, you are in a better position to be awarded with the projects.
Got you. Thank you.
O nce again, if you would like to ask a question, simply press star one on your telephone keypad. Your next question comes from the line, Filipe Leite with CaixaBank. Please go ahead.
Yes, hi. Good morning, everyone. I have two questions, if I may. First one related with service activity, and if you can give us the amount of EBITDA or the gross margin of service-related activity in full year 25. Second one on the artificial intelligence trend, just to confirm if you are involved or have any data center-related project in your pipeline. Thank you.
I believe, yeah, what I said in my presentation, from 25%-30% is what we are currently doing, and that's what we expect for this year as well. Regarding data centers, not in the data center itself, but in the power units that should generate the electricity for the data centers, we are currently involved. It could be a good source of business, mainly in the States from now on.
All right, thank you. Once again, if you would like to ask a question, simply press star one on your telephone keypad. We have no further questions at this time. I would like to turn it back to our speakers for closing remarks.
Okay. Thank you very much. It's been a good year. It has also been shorter than expected. Thank you very much for listening to us. Thank you very much for posting questions, which clarifies many of the things we have presented to you, looking forward to our talk, and see you over the coming months. Thanks a lot. Bye-bye.
Thank you, presenters. Ladies and gentlemen, this concludes today's conference call. Thank you all for joining. You may now disconnect.