Ladies and gentlemen, welcome to the VINCI Q3 revenue 2025 conference call. I now hand over to Christian Labeyrie, Executive Vice President and CFO of VINCI. Sir, please go ahead.
Yes, thank you, Sharon. Hello everybody, and thank you for attending this conference call. I am today with Thierry Mirville, Deputy CFO of VINCI, Grégoire Thibault and the Investor Relations team, and Marie-Amélie Afol, the Group Controller. As usual, I will be brief to have more time for the Q&A session. What are the key takeaways of this publication? First, a solid operating performance year to date, driven in particular by dynamic business levels in energy solutions and concessions. Q3 total revenue was strong and up by almost 5%, 4.7% exactly, and 3.5% like for like. The positive inflection vs H1 reflects both a good momentum across the group's business line during the quarter and also the positive impact of the integration of the recently acquired companies. Some were acquired in 2024, others were acquired in the beginning of this year.
Thus, nine months' revenue totaled EUR 54.3 billion, up almost 4% actual, 3.7%, and 2% like- for- like. International nine months' revenue represented 58% of the total. It was up 5.3% and up 2.3% like- for- like. We have a significant impact of the acquisitions. Changes of scope over the period represent 4.4%+ impact on the international revenue, mainly coming from the acquisition of VINCI Construction, which contributed for around EUR 600 million, of which FM Conway in the U.K. for almost EUR 500 million. Conway was acquired at the beginning of this year, and the closing was performed end of January. We should mention also the acquisition of VINCI Energies, which boosted revenue by around EUR 450 million on the first nine months, and also, obviously, the integration of Edinburgh Airport by Dixie Airports. Do you remember that Edinburgh Airport was acquired in the first half of last year?
The contribution to the nine-month revenue represents EUR 324 million. On the other hand, exchange rate movements had a negative impact of 1.3% on international revenue, as the Euro rose against many currencies, particularly the U.S. dollar, Canadian dollar, Australian and New Zealand dollars, and also several Latin American currencies, in particular the Mexican peso. In France, 42% of the total revenue was up 1.6% for the first nine months of the year, + 4% in the third quarter, which is a very resilient trend in the current environment. I will come back more in detail on the trends for each business later. Second key takeaway, number two, group's nine-month order intake, EUR 46.9 billion. We see the rather limited decrease of 3% year- on- year.
As already flagged in our previous release, this slight decrease is due to the high comps because VINCI, you remember, won several very large projects last year, particularly the two HVDC platforms for COA in the North Sea for German utilities. On the other hand, we should mention the integration of Conroe, which partially balances, but not entirely, the impact of the two platforms. Beyond that, it's worth noting that order intake in Q3 2025 posted a positive inflection and was up 4% vs Q3 2024. Order intake for flow business, which accounts for the large majority of the group's revenue from the energy solution and construction businesses, remains firm and increased by more than 2% in the first nine months. This is despite a reinforced selective approach in some areas, for instance, in Latin America for Cobra IS.
We should mention also the fact that the level of order intake in the first nine months was higher than that of revenue, both in energy solution, EUR 22.3 billion vs EUR 20.7 billion, and for VINCI Construction, EUR 24.6 billion vs EUR 23.8 billion. This means that the order book continues to grow at a good renewal rate. Thus, the order book of VINCI maintained a high level of almost EUR 71 billion at the end of September, which is a growth of 6% year- on- year. This is for each business: VINCI Energies + 8%, Cobra IS + 6%, Construction plus 4%. It represents 14 months of average activity. International made up 70% of the order book vs 68% last year.
Such a robust order book gives good visibility and enables VINCI to continue to remain extremely selective in a turbulent economic and geopolitical environment and continue to give priority to the margin improvements and to the cash generation. Regarding the financial position, the net financial debt of the group at the end of September is well under control. It amounted to EUR 21.4 billion, which is a difference between a gross debt of EUR 33.7 billion and a net cash of EUR 12.3 billion. The net debt is down EUR 800 million year- on- year. Obviously, VINCI's liquidity remains substantial, apart from the cash I just mentioned at the end of September. We should mention also the EUR 6.5 billion of revolving credit facility, which is unused at the holding level.
As a result, with such a sound financial position, VINCI is well prepared to continue to develop in good condition and with serenity with a disciplined cash allocation policy. Let's now have a closer look at the main divisions. First, concessions. Concessions, nine months' revenue of EUR 9.4 billion at 5%, mirroring solid growth in both pax numbers at airports and traffic on motorways in France and abroad. For VINCI Autoroutes in France, nine months' revenue, EUR 5.2 billion, up 2.7%, with traffic up 1.4%, of which light vehicles 1.5% and trucks 0.8%. This is despite two fewer working days vs last year. In Q3, traffic was only slightly up, + 0.3%, with the trucks up 1.2%, despite unfavorable calendar effects. One fewer working day in Q3 vs Q3 last year. VINCI Airports' revenue, EUR 3.7 billion, was up 6.6%.
After a firm demand of travel during the summer, the worldwide network of VINCI Airports welcomed 253 million pax in the first nine months, up almost 6% year- on- year. You already received last week the details of VINCI Airports' performance. Let's remind that the traffic growth was particularly remarkable in Japan, boosted both by the World Expo of Osaka and the renewed momentum of routes with China. Traffic was up 12% in Japan. Mexico, where routes with the U.S. remain dynamic, + 9.6%, and the recently acquired Edinburgh, + 7.3%, and Budapest, + 12% airports, which benefited from demand for flights to the Mediterranean destinations in particular. For energy solutions, made up of VINCI Energies and Cobra IS, revenue totaled EUR 20.7 billion, up 7% on an actual basis, including an 8% growth in Q3. This was driven by business outside France, which accounted for 69% of the total revenue.
Order intake remained firm overall. The momentum confirms that the energy solutions business is strongly positioned in its markets, which are supported by positive megatrends in electricity production and transport and digital infrastructure, as well as in defense and sovereignty challenges. In energy solutions, let's have a look at VINCI Energies first, which printed once more a very strong performance. Nine months' revenue of VINCI Energies amounted to EUR 15.3 billion, up 5.6% actual and 2.5% like- for- like. Business levels remain firm in most of VINCI Energies' markets: France, + 4% in Q3; Germany, which is VINCI Energies' largest market outside of France; Belgium and the Netherlands; Scandinavian countries; and the U.S.
Order intake remained solid and was up 2% in Q3, 1% in the first nine months, so that the order book of VINCI Energies reached an all-time high of EUR 18.1 billion, of which 62% outside France, up 8% year- on- year, representing more than 10 months of VINCI Energies' average business activity. Furthermore, please note that VINCI Energies remains active on the M&A front, having completed 25 acquisitions in the first nine months, which represent a cumulative annual revenue of more than EUR 400 million, of which 80% in Germany and 8% in North America. The main transactions closed in late August were R+S Group and Zimmer & Halbrig in the building solutions businesses in Germany. In addition, keep in mind that the two other significant acquisitions announced in July should be finalized by the end of the year.
These are Wertzinlich Sun Electronics in Germany, which operates in the field of electrical system integration and automation for the German Navy in particular. The second one is Energobit in Romania, which specializes in engineering and works for electrical infrastructure. Overall, these 25 companies newly acquired or about to be acquired will generate a combined annual revenue on a full-year basis of over EUR 600 million, mostly in Europe. Within VINCI Energy Solution, let's now move to Cobra IS. Nine months' revenue of Cobra IS amounted to EUR 5.4 billion, up 10% actual and like- for- like, which illustrates the strong momentum of Cobra in most activities.
EPC projects, representing 43% of the total revenue, delivered a stellar growth of 32%, resulting from progress on strategic energy solution and sovereignty projects in many countries, including Germany, with its HVDC converter platforms and the country's first LNG regasification terminal, then Brazil with power transmission lines, and Australia with the start of a large power transmission contract as part of the PPP of 35 years. On the other hand, flow business activities, 57% of the total, remain in Europe at a very high level. Outside Europe, the slight decrease reflects an increase in activity in some Latin American countries in addition to adverse currency effects. Order intake decreased, but again, to put things into context, remember that the level reached last year was outstanding. Remember, it included, in particular, two orders totaling EUR 2.5 billion for offshore wind farms, energy converters platform in Germany.
Remember also that these very long-cycle HVDC platforms projects will not generate revenue before several years because the yards, the two yards of Cobra IS in southern Spain, are overbooked, but they will provide us with a long-term visibility. The order book of Cobra IS at 30th September 2025 remained at a very high level and amounted to EUR 17.3 billion, up 6% year- on- year, which represents more than two years of Cobra IS average business activity. Please also note that some projects won and announced recently are not yet in the order book of Cobra IS, of which the electrification of the rail network, Rail Baltica. VINCI Construction should be noted. First, that the revenue of VINCI Construction rose by 4% in Q3, 3% on the like-for-like basis, with growth driven by France, up 6%.
As a result, VINCI Construction revenue in the first nine months of the year reached EUR 23.8 billion, up 1% actual, and down 1% like-for-like. Year- on- year, year to date, excuse me, year to date, this change reflects varying market conditions depending on the country and on the business sector since the start of the year. Lower revenue from major projects for reasons relating to the phasing of ongoing projects. Increase of revenue in France thanks to a good momentum, particularly in roadworks, in waterworks, and railworks. Higher business levels in continental Europe and Africa. Stability in the U.S., but decreases in other regions, such as Canada, Australia, and New Zealand, due particularly to adverse currency effects. Lastly, slight growth in revenue from specialty networks, so les tranches racinées. Q3 was strong as well in terms of order intake, up 12%.
As a consequence, order intake at the end of September are back in the positive territory vs last year, slight up by 1%. The order book of VINCI Construction at 30th September 2025 amounted to EUR 35.1 billion, up 4% year- on- year, and representing more than 13 months of VINCI Construction's average business activity. Finally, VINCI Immobilier, the real estate business. Revenue grew by 3% in Q3, limiting the decline in the nine-month period to + 2%. The number of housing units reserved by VINCI Immobilier in France at the end of September were down 8%, but rose by 10% in Q3. Probably still much too it is still much too early to open champagne, but a welcome positive inflation risk. Finally, please note that VINCI and ACS Group signed an agreement definitively settling the 2021 acquisition of Cobra IS.
The main terms of this agreement signed during the quarter are as follows: one, earnout was set at a fixed amount of EUR 318 million vs a cap of EUR 600 million in the initial agreement, EUR 318 million instead of EUR 600 million, with a balance of EUR 200 million to be paid, which was paid by VINCI in September. We had paid EUR 80 million previously. Second, termination by VINCI and ACS of their original agreement relating to a joint venture carrying out renewable energy projects developed by Cobra IS. In a nutshell, we paid a lower earnout than initially planned while taking back the full control of our strategy regarding renewable energy developments.
In conclusion, despite the turbulent macroeconomic and geopolitical environment, the excellent overall performance of VINCI's businesses in the first nine months of the year once again demonstrates the strength of the group's multilocal model, its highly decentralized organization, and its resilience. VINCI therefore confirmed its 2025 guidelines. To wrap up, VINCI expects its total revenue and earnings to rise again in 2025 before factoring in the increase in corporate tax rates in France. Thank you for your attention. Before taking your questions, I would like to emphasize that I will not make any comment on the current discussions at the French Parliament regarding the national budget for 2026, as these discussions are at a very early stage and may sometimes appear as quite erratic. Thank you again. I'm now ready to answer your questions.
Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will now go to our first question. One moment, please. The first question comes from Luis Prieto from Kepler Cheuvreux. Please go ahead.
Good evening. Luis Prieto here. Thanks for taking my questions. I had a couple of quick ones. The first one is if you could shed some additional light on why you dropped from the I-285 Managed Lanes process in Atlanta. Does this mean you're no longer interested in the space? The second question is regarding the next steps in Gatwick after September's development consent grant. Thank you very much.
[audio distortion]
Hello?
Hello, sir. The speaker line is currently muted, just to confirm.
Oh, okay. Yes, we put the line on mute by mistake. The answer for Atlanta is very simple. I think we have explained on many occasions our way of approaching the management market in the U.S. We have no local presence in Atlanta, so we are not comfortable with the local environment. You know that for taking this type of risk, we consider it essential to have a local partner. We don't want to go on our own. We have not a local partner in the area of Atlanta. We analyze the risk, and finally, we consider that the risk reward was not, we were not comfortable with the risk reward situation in this particular case.
The second question was, next step is a period which can last between one and two years to get, I would say, remarks from the stakeholder in the area of Gatwick about the term of the proposal we made for extending the capacity of the airport.
Excellent. Thank you very much.
Thank you. We will now go to the next question. The next question comes from Elodie Rall from JPMorgan. Please go ahead.
Yeah. Hi. Hello. Thanks for taking my questions. The first one is on the airport division. Maybe a bit of a naive one, but revenues were a bit below our expectations. I was wondering if you could shed some light on it because traffic was up 4.2% in Q3, but revenue only came up at 0.8%. Maybe you can help us understand the impact from tariffs and FX on that division. My second question is on whether you have any views on the German plan. We've seen some preliminary budget for 2026, which look a bit flat. I was wondering if you could give us a bit your views on when you think that these plans will start showing up in order intakes for your group. Thanks very much.
Elodie, about the airport business, there is a perimeter effect in France because we have the impact of the deconsolidation of the non-airports this year, which we had not last year. There are also some significant currency effects in Mexico, particularly. These are the main factors that I have in mind to answer your point. As for Germany, you know, the German are very serious people. Before launching in practice what they have said they intend to do, they do a preparation work, which can take some time, both on the infrastructure side and on the defense side. We expect no impact of this plan in the short term. I read somewhere that one of our big colleagues present in the production of aggregates was considering a potential impact not before 2027. Maybe it will be before, but not much before.
The good news is that we have much enough job to do. Germany has not a very dynamic demography, and we are very big in Germany. We make a lot of projects in all divisions, and manpower is clearly an issue. If it takes a bit more time to start, in practice, the launching of this plan, it's rather a good news than a bad news. We will see the thing in the long run, rather in the short run.
Okay, thank you.
Exposition, which is like the one we made this year, the three significant ones we made this year, is a way to acquire production means. You know, when you acquire a company, it means you acquire a team. You acquire technicians, workers, engineers, etc. It's very important if you want to continue to grow on a very interesting market for us.
Thank you. As a reminder, if you would like to ask a question, please press star one and one on your telephone keypad. That is star one and one to ask a question. We will now go to the next question. One moment, please. Your next question comes from the line of Eric Lemaire from CIC. Please go ahead.
Yes. Hi. Good evening. Thanks for taking my question. I got two, actually. First, in France, I appreciate that you don't want to make any comments on the current discussion on the budget today. Regarding this political situation in France, do you see any impact on your clients in France? I mean, do you see any investment decision delayed due to this situation? This is my first question. I have a second question on Germany. Elodie mentioned this German plan. Do you see that there could be an acceleration maybe in air models in Germany along with the German plans? Could you remind us today of your exposure to Germany, all businesses combined, including the last acquisition you made in the energy business? Thank you.
The potential impact of the French mess on our clients, honestly, so far no. What we expect is an impact on, but this is not due to what is happening at the Parliament presently, it's more due to the election calendar. You know that next year, in March, will take place local election in France, which means electing the mayors of the cities or renewing the existing mayors. This happens every six years. Last time was in 2020, in the middle of COVID. In this period, which is just before the election rendezvous, we see a slowdown in terms of order in the roadwork business in particular. It's not really new, and we know how to cope with that. We have a system in France which permits us to be flexible in the running of the manpower in order to avoid idle costs.
We expect that this phenomenon will happen again, which is like it happens every six years. This is not really linked to the discussion ongoing in the French Parliament. The second question was relating to Germany. Do you want to know about the exposure to Germany? Germany, on a full-year basis, but this was last year, so it will be probably certainly more this year, was EUR 5.6 billion of revenue. I suppose this year we should be around EUR 6 billion, but I don't have a precise figure to give you. It will go considering the acquisition that we have closed, which will not produce their full effect on 2025, but more on 2026. I would say around 60% of the revenue we generate in Germany is generated by VINCI Energies, so it's essentially small, low-risk projects in all types of sectors: industry, building solutions, new technologies, infrastructures.
VINCI Energies employed more than 16,000 people on nearly 400 sites. We are very densely settled in the country. VINCI Construction, but this is essentially road paving, makes around EUR 1.5 billion of revenue. We have a synergy developed thanks to Eurovia in order to be a leading company on the PPP and the A model or B model market, which consists in modernizing, widening roads, motorways, within the PPP contracts. We have presently five PPPs under operation or under construction. I think one is under construction, four are under operation. Two have a traffic risk, and three have not. Finally, Cobra, but Cobra is gaining ground. Presently, Cobra, last year, performed less than EUR 1 billion of revenue. It should be more this year. This is essentially represented by these large projects in the North Sea. They have also some flow business.
Cobra IS is also present in flow business in Germany. VINCI Group is present in Germany in all its activities. It's a major country for us. It's the second after the U.K. and obviously after France. Outside of France, it's the second largest market for us. It represents around 20% of our present order book.
Thank you.
Thank you. We will now go to the next question. The next question comes from the line of Nicolas Mora from Morgan Stanley. Please go ahead.
Yes. Good afternoon, guys. Just a couple from me. On VINCI Energies, so you're trending around 2%-3 % organic growth. Orders are what, stuck between 1% and 2% year-on-year growth. Are we on that same line into the back end of the year and the start of 2026? You're not seeing any, I guess, I mean, you were sounding cautious early on, but you're not seeing any further slowdown. It's just basically slightly hovering above flat, but not much, closing of projects at the back end of the year. That's the first question. Second, on M&A, thanks for the details on VINCI Energies. Outside of very small bolt-ons, and the deal announced late July, is there anything else in the pipeline? Actually, both on VINCI Energies and concessions, we're not picking up much.
I was just wondering if you still had a pipeline ahead of you that was worth maybe mentioning with us. Thank you.
You know that on the second question, we never disclosed the potential needs which are in our pipeline. As for the forecast for the year, we stick to what we said in the previous releases about the evolution of our activity and of our margins for all business lines, including VINCI Energies. I have nothing to add to what we have already said and reaffirmed in our present release. I just want to highlight the fact that the order book of VINCI Energies reached an all-time high of EUR 18.1 billion, which is a lot. We present 10 months of activity as an average. It's essentially small projects, low-risk projects.
Sure. In terms of the, let's say, the clean year-on-year, you're holding up okay, but you're not seeing any acceleration from where we stand right now. I guess 1%- 2% year-on-year growth in orders is going to translate into kind of similar growth over the next three to six months?
I don't know if I mentioned it, but in France, the order book and the revenue in Q3 is up 4%. It's more than the previous quarter. It probably means also that it's not always relevant to analyze very much in detail quarter- by- quarter because you can have phasing issues and seasonal issues, even for the revenue in the vacation period, for instance. We keep the forecast we already released, and we are obviously very positive. VINCI Energies and Cobra IS are one of the growth drivers of the group for the future, not only because of organic potential of growth, but also potential of acquisition, as you know.
Okay. If I may, last one, just on the net debt figure you provide, I mean, if we go backwards, work from there towards the free cash and net working capital, there is nothing to say on payment cycle, payment terms, prepayments, business. Is it business as usual or there's anything to mention?
The fact that we entered less large projects this year compared to last year, particularly at Cobra IS, has obviously an impact on the cash advance payments. When you have less large projects, you have less advance payments. We compensate this at the level, at least of the order book or the revenue, through an increased flow business activity. We don't have any significant swing to mention at this stage of the year, except remember that last year, in December, we had very significant collections, which we cannot, for the time being, assume that we will have again this year. That's why we were very cautious about any forecast at the level of the working capital requirement variation.
All right. Very clear. Thank you.
Thank you. Your next question.
At the level of the debt, you can see that the debt is well under control, which is a mix of different things: CapEx, which are more or less stable, acquisitions, which are less significant than last year, and operational cash flow, which is in a good situation. We will have to pay, I will remind you, we have to pay at the end of the year more than EUR 400 million additional tax to the French government. This has to be taken into account also when you try to make projections of free cash flows.
Thank you. We will now go to the next question. Your next question comes from the line of Graham Hunt from Jefferies. Please go ahead.
Hi. Thank you for the questions. I've just got two. First one on construction, and apologies if I missed this in the remarks. Just the inspection there and in France, is there some pull forward that we should be thinking about for Q4 phasing there? Is that sort of Q3 pull forward some work that helps that number? The second question, just when we think about the overall EBITDA number for airports, how should we think about the new airport that you've added in Cambodia, the management contract there, the operating contract there, sorry? Also, just in light of the pricing that was negative in Q3, should we be factoring anything in there in terms of our estimates for second half EBITDA for the airports? Thank you.
Don't comment about EBITDA. That's not the purpose of the release. The purpose of the release is to comment on the activity, the order intake and order book, and the cash position, net cash position, and net investments. It's not to comment about the figures in the detailed figures of the P&L. We don't make any comment about the EBITDA of such or such activity. What was the question about construction? Hold on a second. Graham, about Cambodia, you know very well our activities in Cambodia. We used to be a concessionaire of the Phnom Penh Airport. Our concession contract has been finished, terminated, but we have been quite good since we have obtained to run the new airport, which has been developed by local investors, but which had many lots of money, but maybe not enough practice to efficiently manage an airport. We effectively obtained a management contract.
You know, obviously, that's a management contract. You cannot generate the same level of EBITDA in terms of margin vs a concessionaire EBITDA since we don't have, we have not invested any single, I don't know what is the currency of Cambodia. We have not invested a single dollar in this new airport. We are very pleased to have secured this management contract, which permits us to still be a partner to the local authorities, thanks to this management contract, and also to the concession of Sienneville on the coast. The last question was relating to construction. Maybe you remember that in the past, on several occasions, we highlighted the fact that the activity level in construction might change due to some phasing effects on large projects.
When you finish a project and you start a new one, it can take some months before you generate the normalized level of activity. It's exactly what happened in the first quarter. In the third quarter, we have some large projects which we won last year, particularly at the Grand Paris Line, 15 West, which is linking our head office in Nanterre to the Bridge of Sèvres in the south-west of Paris. It's a very large conception construction project, which is increasing the pace at which the work is performed. This is part of the explanation. We have some other projects like that which contribute to the growth of VINCI Construction in France in the third quarter.
Very helpful. Thank you. Thank you.
Thank you. As a reminder, if you would like to ask a question, please press star one and one on your telephone keypad. We will now go to the next question. One moment, please. Your next question comes from the line of Marcin Wojtal from Bank of America. Please go ahead.
Oh, yes. Good afternoon. Thank you for taking my question. I wanted to follow up on your net debt number, which you reported at EUR 21.4 billion, which I believe is almost EUR 2 billion reduction vs H1. Quite a significant number. Could you clarify, is that a good proxy for free cash flow generation in the quarter, which seems to be quite high, or were there maybe some other impacts? I don't know. Maybe a reduction in the debt due to FX effects or any other factors. Thank you.
I will not make comment about the free cash flow for the same reason as I don't want to make any comment about the EBITDA margin. It's not the purpose of this first quarter information. It's a combination of different things: CapEx, working capital change, EBITDA generation, etc., etc. I will not disclose more details. I'm sorry. You have to be a bit patient and wait a few months before you can give more detail, more color about the cash flow situation of the group for this year.
Okay, thank you.
Thank you. There are currently no new questions. I will pass the call back to you, sir.
Marcin, just to give you a so that you are not too frustrated. You know that in the summer, we have a very strong activity in the motorways in particular, but also on the airport. We have cash collections, which are at a high level during this period of the year, which is part of the explanation why the free cash flow has improved during the summer. If you look at the curves that we produce on a regular basis to compare the evolution of the free cash flow along the year on the previous year, you will see that it's always the same. Starting in June, July, you have a significant improvement of the cash flow of the group, which is around zero and even negative in the first half of the year. It's a normal evolution, I would say, considering the seasonal profile of the VINCI activities.
Excuse me. The next question?
There are currently no further questions, sir, at this time. I will pass the call back to you.
Thank you for your patience and for your questions. We are looking forward to meeting you physically at future roadshows or one-on-ones and meetings with investors. Thank you very much.
Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.