Abertis Group Annual ReportPresentation Transcript
annual report 10
ontents contents contents co Letter from the Chairman Interview with the CEO Corporate administration and administrative bodies 1.1 Corporate administration 1.2 Administrative bodies abertis group business activities 2.1 Toll roads 2.2 Telecommunications Infrastructures 2.3 Airports 2.4 Car Parks 2.5 Logistics Parks Corporate social responsibility 3.1 abertis’s Strategic Plan 3.2 Indicators 2010 Economic and financial information 4.1 Consolidated figures 4.2 Financial management 4.3 Shareholders and the stock market
4 AR CSR AA REvEnuE by OpERatIOns sECtOR Car parks Logistics services 4% 1% Airports 7% Toll roads Telecommunications 75% 13% 2010 REvEnuE by gEOgRaphIC aREa Chile Rest of the world 5% 6% United Kingdom 4% Spain France 50% 35% 2010 abertis has consolidated its position as one of the world leaders in the private management of public infrastructures and operates in a total of 17 countries.
5 AR CSR AA Direct stake toll road Telecommunications Airports sector concession revenue infrastructures revenue operating revenue Car parks sector revenue Logistics parks sector revenue 3,078millions of euros 552 millions of euros 277 millions of euros 154 millions of euros 35 millions of euros saba remains one of the leading abertis logística is the business 2010 has seen the consolidation of abertis telecom has celebrated In the course of 2010, abertis operators in the sector in Spain unit of abertis which focuses abertis autopistas’ management its tenth anniversary in 2010 by airports has consolidated its and in the rest of the world, on the promotion, design, model and a recovery in its traffic. establishing itself as the leader position as one of the benchmark managing a total of 128,149 development, management This has been mainly due to its in terrestrial telecommunications operators in the airport spaces in 195 car parks in Spain, and use of logistics parks in successful internationalization infrastructures and services in infrastructures sector in the world Italy, Chile, Portugal, France and Spain, Portugal and Chile. It has process that has enabled it to Spain with the largest network with operations at 29 airports in Andorra. consolidated its position in Spain consolidate its position in France for broadcasting and distributing Europe, the US and Latin America and has excellent prospects and South America, where the audiovisual signals. It is the and overall annual traffic coming to abroad. economy is stronger than in other internationally recognized satellite 58 million passengers. countries. broadcasting operator through its key holdings in operators Eutelsat and hispasat.
6 AR CSR AA Letter from salvador alemany, Chairman “Each one of the Group’s businesses has a development project with a distinctive future and profile” Dear Shareholders: of the consolidation of our operations after our period of major growth between 2004 and 2009. One of the main aspects of 2010 for abertis has been the consistency and strength of some fundamental factors that have enabled the As for the performance of our stock, which is down 10% compared Group to continue growing. This is the case even after three years of to 2009, this was markedly less negative than that of the IBEX 35 as a crisis that has hit the amount of traffic on our toll roads in Spain a whole which fell by 17.4%. Furthermore, other groups operating especially hard, and although this growth may be taking place at a in our sector experienced losses of between 16% and 28%. On more moderate rate, it is growth all the same in our key figures. more than one occasion I have argued that stock is governed and moved by the markets. Our responsibility lies in our commitment to Geographical diversification (50% of our revenue is generated a policy of remuneration for our shareholders based on the familiar outside Spain), the growing visibility of businesses such as combination of dividends and bonus shares. The strength, recurrence telecommunications and the remarkable and positive growth in and robustness of flows from our businesses are the best guarantee traffic on our toll roads in France and Latin America are crucial in for the sustainability of this policy and the future expectations of understanding the key factors in our group’s progress. our stock. 2010 has been a year in which we have also operated from a solid Our Group has adapted to the economic situation. We were able basis founded on the recurrence of our economic indicators: revenue, to get the most out of opportunities for growth at times of high operating income, cash flow and net income. These have not been liquidity and we committed to consolidation, greater efficiency and results influenced by changes in the scope of consolidation as these exigency in managing costs and our debt structure and also to the Salvador Alemany, have not been very significant. Instead they are the outcome of the potential of our businesses for organic growth when liquidity was Chairman dynamics of our various businesses. It is a profile that is the product squeezed and market opportunities dwindled.
7 AR CSR AA The Duplo project involves the reorganization of our five businesses around two companies, Abertis Infraestructuras and Saba Infraestructuras. These two companies have the relative size and organization that is appropriate to the scale of these businesses and their stages of maturation. On several occasions I have talked about what abertis’s business ning to enhance the talent of their people, that have set up domestic Abertis Infraestructuras’ greater focus on three areas of business project consists of. It is a project that trusts in the strength of its markets which have drive and dynamism and that will gradually de- should mean that it is able to identify and capitalize on any growth arguments to be able to work with government and its customers, velop regulatory frameworks and an environment of legal certainty opportunities that may come up. and also in the skills and abilities of its teams to identify, and in which will also provide the conditions for our investment. They are some cases help to realize, the opportunities that drive and provide markets and countries which are asserting their role in the global The goal that motivates us is that all our stakeholders –employees, a future to our businesses. economy and which are convinced that their time has come. shareholders, management team, governments and administrations, the customers we serve– should continue to see in each one of the This expertise and know-how that are so instantly recognizable in We need to get ready to seize the opportunities that come up under Group’s businesses a development project with a distinctive future the Group’s businesses have been crucial when it comes to attracting the most favourable conditions both in our traditional markets and and profile, with a definite vision of the role they want to play in their the interest of new partners, such as CVC, which have decided to sign also in these new markets. We need to think ahead to expedite the respective areas. Players who are loyal, responsible and committed up for and actively take part in the future of abertis’s project. This conditions that drive the development and harnessing of the growth to quality-driven management, efficiency in resource utilization, means that the Group can benefit from the experience, vision and potential of our businesses over the medium and long term. partnerships with communities and regions and to achieving results knowledge of global markets that our new partners contribute. With that continue to give good reason for the confidence of shareholders them, with our historical shareholders, with our small shareholders The Duplo project is designed to achieve this goal. Its study phase and investors. and with the team of people working in day-to-day operations in began last February, geared towards the reorganization of our five our businesses, we can develop and grow. businesses around two companies: Abertis Infraestructuras with the This is our world, one that is marked by the global markets in which we toll roads, airports and telecommunications business units, and Saba operate, mindful of the necessary sustainable relationship between For infrastructure managers the opportunities are, and will remain Infraestructuras with the car parks and logistics parks ones. These infrastructures and their physical environment, and partnering over the coming years, significant in both number and in size, and two companies have the relative size and organization appropriate government in implementing cost-benefit analysis criteria that help probably more so than they have been so far in this first decade to the scale of these businesses and their various stages of to construct objective decision-making models concerning which of the 21st century. And here it is possible to make out, alongside maturation, with in the case of Saba Infraestructuras a shareholding infrastructures should be given priority, how they should be financed Europe and the United States, an increasing role for the emerging structure in which current abertis shareholders can join with new and how they should be managed, without losing sight of the return countries. These are countries that believe in their possibilities, that institutional investors that accompany growth which is intrinsic they need to yield in terms of economics, productivity and social have growing access to financial and natural resources, that are lear- to the concessional nature of our businesses. At the same time, utility.
8 AR CSR AA Interview with Francisco Reynés, CEO “abertis continues to grow” Q. 2010 has been your first year as CEO of the group. how Q. Which factors stand out as most relevant in the progress would you assess it? of the businesses? A. A striking fact is that in 2010 after three years of crisis, A. Firstly there is the positive performance of traffic on toll one of the biggest crises in fact of the last 60 or 70 years, roads outside Spain; +1.3% in France and +5.5% in the rest abertis has once more continued growing. Aside from the of the international business. This has confirmed uncertainty circumstantial situation of one or another of our businesses or about when the turnaround will come in Spain and also that its the countries in which we operate, our Group’s consolidated recovery is expected to be slow, yet at the same time it has also figures have experienced sustained, albeit moderate, growth provided a contrast with the offsetting factor of the contribution in terms of revenue, up 5.2% to almost 4,106 million euros, made by countries such as France and Chile, in which recovery gross operating margin, up 5.9% to 2,494 million euros, and net looks robust and can largely make up for the negative figures still income which is also up by 6.1% to close at 662 million euros. coming out of Spain with a 4% fall in traffic. Then of course there is our geographical diversification –up There is also the growing visibility of businesses such as abertis to 50% of our revenues are generated outside Spain– and the telecom. In this case the completion of the rollout of DTT in growing contribution of businesses such as telecommunications Spain, the diversification of its range of signal broadcasting which are crucial to the interpretation of the Group’s develop- services which reduces dependence on the traditional radio and ment. TV business and the growing contribution of satellite operations by hispasat and Eutelsat reveal a business that has matured I think achieving these figures in this economic situation and is contributing to the good performance of the Group in demonstrates the consolidation of our Group’s progress and the current economic context. In fact, abertis telecom has that of each of its businesses over recent years. The result we successfully managed to absorb the impact of the “analogue have achieved in 2010 is a direct result of the work done over switch-off”, which brought to an end a period of several years in these recent years of transformation and strong growth. which the changeover from one type of technology to the other
9 AR CSR AA and their chronological overlap drove revenue in this business The Group’s borrowing structure also reflects the resilience of area, with new business growth coming to 2%. our figures. Average life stands at 6.6 years and 84% is linked to fixed rates. Also worth mentioning is the evolution of the net In the case of airports, the most significant thing in a The result achieved in 2010 debt/EBITDA ratio which was at a multiple of 5.9 compared to context in which a recovery in passenger numbers at tbi 6.2 at the end of 2009. airports, especially in the UK, did not materialize, was the is a direct result of the work improvement in revenue per passenger as a result of the done over these recent years These factors were decisive in the confirmation of the Group’s various measures taken by the abertis airports team. rating as having a “stable” outlook. Revenue in this business unit grew by 5.5% compared to of transformation and strong 2009. growth Q. you mentioned stability in the scope of consolidation; how have the group’s investments developed in 2010? As for the car park business, stability was the key factor in 2010 in relation to activity indicators for 2009. 56.3 million vehicles used A. The Group’s scope of consolidation did not change our car parks over the course of the year, the same as in 2009, while substantially in 2010. In fact our investment volume, which at revenue rose by 2.8%. The reality of growth ranging between 1% and 5% has also led 757 million euros over the twelve months is significant, reflects to an additional requirement to contain operating costs which firstly a major reduction in growth processes resulting from the Turning to operations in logistics parks, they faithfully reflected on a like-for-like basis fell by 0.2% over 2009. This, together with consolidation strategy pursued in recent years and secondly the poor economic conditions inasmuch as average occupancy financial costs which contrary to market trends even fell slightly Group’s essentially recurring investment efforts in the assets rates for our parks fell by 9.4 points compared to 2009 to to 4.5% from 4.6%, was instrumental in the Group’s growth. that make up its portfolio. Because of its size and recurrence, the stand at 65.6%. However, it should be noted that gross floor Another fact which also demonstrates the Group’s strength is indicator for the Group’s investments is one of the data that best area increased by 4.5%. Here a major development was the the recurrence of cash flows, which at 1,616 million euros was reflect the scale achieved by abertis over recent years and the commissioning of our logistics park in Santiago de Chile, which the figure that grew most at 7.6% compared to 2009. significant quantity of resources committed to maintaining and in line with the strong growth in the country’s economy kicked improving the quality and functionality of the infrastructures we off with occupancy levels of 100%. manage.
10 AR CSR AA Interview with Francisco Reynés, CEO From the investment standpoint another highlight in 2010 has selectivity in the assets in which we invest. Here, and together improving our margins which mainly depends on ourselves and been the final agreement with the French government for an with other projects, we are following with great attention the not so much on outside circumstances. extraordinary investment of 250 million euros over three years process of redefining the airport management model in Spain in exchange for the extension by one year, up to 2029, of sanef’s which may well open the door to the award of the management Another aspect that the management team is continuing to keep toll road concession. This plan, dubbed the “Paquet Vert” because of some of the country’s main airports. an eye on is the containment of operating costs and investment it involves investments geared towards reducing environmental in expansion in all the sectors and countries in which we operate. impact, is an example of the ability to call on major short-term As for organic activity, and save for the uncertainties which I This is a basic factor in the current environment of uncertainty private investment flows in infrastructure networks with return have already mentioned, we anticipate that traffic will stabilize in which is also marked by the increasing cost of borrowing. mechanisms, in this case the extension of the concession, which Spain while it will continue to grow in France and South America. do not strain the public purse. Passenger traffic at airports should pick up as well. We are also Q. What does the group hope to achieve with the optimistic about the development of abertis telecom after the restructuring of its current businesses around two Q. What can you tell us about the forecast for 2011? completion of the rollout I mentioned before of DTT in 2010. To companies? all this you can add a greater focus on cost control as a factor in A. I think that the outlook is good on the whole. However, we do A. The target is growth. After three years of economic crisis, in need to follow closely, and respond to the best of our ability, the which we consolidated the phase of strong expansion that we evolution of external factors such as the geopolitical crisis in North implemented between 2004 and 2008, we now need to get ready Africa and its impact on oil prices, inflation and interest rates. All of for a new stage. Incorporating assets that improve the average these factors are likely to affect how we come out of the crisis and At 1,616 million euros, life of our concessions is a strategic imperative for creating value also in tandem the forecasts we have been working with, especially in the medium and long term, and this is the goal we have set. in terms of the change in traffic on our toll roads. cash flow was the figure We are going to fashion the conditions required for each of our that grew most at 7.6% existing businesses to be able to access resources in a context in We are working to maintain the strong cash flow generation of which any growth project calls for greater capitalization and less our businesses. As was the case with Atlantia last January, we compared to 2009 recourse to borrowing. are examining divestiture alternatives for some of our holdings as a way of financing the Group’s new expansion opportunities, We believe that the structuring of the businesses around and always based on the requirement for expected returns and two companies operating independently will provide each
11 AR CSR AA one of them with a focus and specialization in terms of their of two companies that operate independently with their own priority areas; toll roads, telecommunications and airports in management teams and different shareholding structures, even the case of abertis, and car parks and logistics parks in the Incorporating assets that though some of the shareholders will be the same across the case of Saba Infraestructuras. This is like saying that it will two companies. It should be borne in mind that a significant give them greater growth potential as there will be a greater improve the average life of portion of our shareholders are with us for the long haul and correlation between the projects to be implemented and our concessions is a strategic have accompanied the Group’s growth over recent years. They the resources available. One of the merits of the proposed will thus get the chance to actively take part in the new stage plan is the opportunity afforded to abertis’s shareholders to imperative for creating value by accompanying the future development of abertis and Saba remain linked to all the Group’s existing businesses as they in the medium and long term Infraestructuras. will have the chance to join the shareholders of the new Saba infraestructuras. That way they become shareholders
nance governance governanc Letter from the Chairman Interview with the CEO Corporate governance and management bodies 1.1 Corporate administration 1.2 Administrative bodies abertis group business activities 2.1 Toll roads 2.2 Telecommunications Infrastructures 2.3 Airports 2.4 Car Parks 2.5 Logistics Parks Corporate social responsibility 3.1 abertis’s Strategic Plan 3.2 Indicators 2010 Economic and financial information 4.1 Consolidated figures 4.2 Financial management 4.3 Shareholders and the stock market
14 AR CSR AA 1.1 Corporate administration Operations based on transparency and rigour abertis operates through a solid and organized governance In this respect, abertis not only ensures strict compliance with structure which consists of the Board of Directors and its various rules and recommendations in this area but also seeks to make committees (Executive, Audit and Control, and Appointment and sure that the fundamental concepts which guide its practice are Remuneration) and has made transparency and rigour into the built into the corporate culture of the entire organisation. Hence cornerstone of its actions. over the course of 2010, the company has continued to foster the implementation of corporate governance best practice, which is This means its management bodies are fully aligned with the already consolidated in the listed company, in its subsidiaries. corporate governance best practice contained in the Unified Code of Corporate Governance, which has been buttressed by abertis’s internal regulations, contained in its Bylaws, the commercial law and in particular by the regulations about the Regulations of the Annual General Meeting and the Regulations securities market and company law. In this latter case, there of the Board of Directors, lay down rules of conduct for members has been enhanced use of the provisions contained in Royal of the Board and ensures that decision-making pursues the Legislative Decree 1/2010, of 2 July, which enacts the amended corporate interest of the company, enables shareholders to text of the Capital Companies Act. exercise their rights and also provides the capacity to continue delivering value.
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16 AR CSR AA 1.2 Administrative bodies board of Directors (as of 31 December 2010) salvador alemany Mas Chairman Florentino pérez Rodríguez Isidro Fainé Casas 1st Deputy Chairman 2nd Deputy Chairman g3t, s.L., represented by théâtre Directorship services alpha, s.à.r.l., repre- Carmen godia bull sented by Javier de Jaime guijarro 3rd Deputy Chairman 4th Deputy Chairman Marcelino armenter vidal Francisco Reynés Massanet Chief Executive Officer Ricardo Fornesa Ribó Ángel garcía altozano l Executive Committee l audit and Control Committee pablo vallbona vadell Emilio garcía gallego l appointment and Remuneration Committee * Appointed Vice-secretary, non-board member on 8 June 2010 to replace Juan A. Margenat Padrós. He is also théâtre Directorship services gama, Ernesto Mata López Secretary, non-board member, of the Appointment and s.à.r.l., represented by José antonio Remuneration Committee (see next page). torre de silva López de Letona Enric Mata tarragó In the course of 2010 Théâtre Directorship Services Alpha, S.à.r.l., Théâtre Directorship théâtre Directorship services beta, s.à.r.l., Services Beta, S.à.r.l. and Théâtre Directorship represented by santiago Ramírez Larrauri Miguel Ángel gutiérrez Méndez Services Gama, S.à.r.l. have joined the Board, and Comunidades Gestionadas, S.A., Javier Leopoldo Rodés Castañé Echenique Landiribar, Braulio Medel Cámara Ramón pascual Fontana and Julio Sacristán Fidalgo have left it. Manuel Raventós negra Josep Maria Coronas guinart Miquel Roca Junyent Vice-secretary, non-board member* Secretary, non-board member
17 AR CSR AA Executive Committee Delegated monitoring bodies Executive Committee Salvador Alemany Mas (Chairman) Isidro Fainé Casas Florentino Pérez Rodríguez G3T, S.L., represented by Carmen Godia Bull Théâtre Directorship Services Alpha, S.à.r.l., represented by Javier de Jaime Guijarro Marcelino Armenter Vidal Francisco Reynés Massanet Théâtre Directorship Services Gama, S.à.r.l., represented by José Antonio Torre de Silva López de Letona Miquel Roca Junyent (Secretary, non-board member) From left to right: Carmen Godia Bull, Florentino Pérez Rodríguez, Isidro Fainé Casas, Salvador Alemany Mas, Francisco Reynés Massanet, Javier de Jaime Josep Maria Coronas Guinart (Vice-secretary, non-board Guijarro, Miquel Roca Junyent, José Antonio Torre de Silva López de Letona, Josep Maria Coronas Guinart, Marcelino Armenter Vidal. member)* * Appointed Vice-secretary, non-board member on 8 June 2010 to replace Juan A. Margenat Padrós. appointment and Remuneration Committee Manuel Raventós Negra (Chairman) In the course of 2010, Théâtre Directorship Services Alpha, S.à.r.l., Ricardo Fornesa Ribó and Théâtre Directorship Services Gama, S.à.r.l. have joined the Théâtre Directorship Services Alpha, S.à.r.l., represented by Javier committee to replace Ángel García Altozano and Pablo Vallbona de Jaime Guijarro Vadell. Ángel García Altozano Miguel Ángel Gutiérrez Méndez audit and Control Committee Josep Maria Coronas Guinart (Secretary, non-board member)* Ernesto Mata López (Chairman) * Appointed Vice-secretary, non-board member on 8 June 2010 to replace Juan A. Marcelino Armenter Vidal Margenat Padrós. Emilio García Gallego Marta Casas Caba (Secretary, non-board member) In the course of 2010, Ricardo Fornesa Ribó and Théâtre Directorship Services Alpha, S.à.r.l., have joined the committee.
18 AR CSR AAsenior Management (as of 31 December 2010) Chairman Chief Executive Officer Salvador Alemany Mas Francisco Reynés MassanetChairman’s Office staff Corporate secretariat Corporate Management Director of Studies and Director of Institutional Company Secretary Director of Corporate Director of Corporate Director of Strategy and Director of Corporate Director of Personnel Communication Relations Josep M. Coronas Legal Services Security Corporate Development Control and Management and Organisation Antoni Brunet Mauri Sergi Loughney Castells Marta Casas Caba Luis Jiménez arrébola David Díaz Almazán Jordi Lagares Puig Joan Rafel HerreroFinance Management Managing Director of Director of Corporate Director of Investor Relations Director of Corporate Director of Director of Purchasing Finance and Corporate Finance Steven Fernández Fernández Fiscal Planning Information Systems and General Services Resources José Luis Viejo Belón Josep Maria García Martín José Carlos Moreno Montero José María Gómez Hospital José Aljaro Navarrobusiness and Operations Management Managing Director of Managing Director of Managing Director Managing Director of toll Managing Director Managing Director of Managing Director of General Director of Managing Director of Business and abertis autopistas of sanef roads North America and of toll roads South abertis telecom abertis airports saba abertis logística Operations Josep Lluis François Gauthey International America Tobías Martínez Gimeno Carlos del Río Carcaño Jordi Díez Díez Joan Font Alegret Josep Martínez Vila Giménez Sevilla Jordi Graells Ferrández Gonzalo Ferre Moltó
activities activities activities Letter from the Chairman Interview with the CEO Corporate governance and management bodies 1.1 Corporate administration 1.2 Administrative bodies abertis group business activities 2.1 Toll roads 2.2 Telecommunications Infrastructures 2.3 Airports 2.4 Car Parks 2.5 Logistics Parks Corporate social responsibility 3.1 abertis’s Strategic Plan 3.2 Indicators 2010 Economic and financial information 4.1 Consolidated figures 4.2 Financial management 4.3 Shareholders and the stock market
20 AR CSR AA abertis has consolidated its position as a world leader in the private management of public in- frastructures and in 2010 it has had a presence in a total of 17 countries through five business areas: United Kingdom Toll roads Ireland Sweden Telecommunications infrastructures Airports United States Andorra France Car parks Spain Logistics parks Puerto Rico Italy Mexico Portugal Jamaica Colombia South Africa Bolivia Chile Argentina
21 AR CSR AA shaRE OF OpERatIng REvEnuEs by sECtOR anD gEOgRaphIC aREa Car parks Logistics services Car parks Logistics services Chile Rest of the world Chile Rest of the world 4% 1% 4% 1% 5% 6% 3% 6% Airports Airports 7% 7% United Kingdom United Kingdom 4% 4% Toll roads Toll roads Spain SpainTelecommunications 75% Telecommunications 74% France France 52% 50% 13% 14% 35% 35% 2010 2009 2010 2009 avERagE WORKFORCE by sECtOR anD gEOgRaphIC aREa Car parks Corporation Car parks Corporation 3% 3% Rest of the world Rest of the world 9% 9% 20% 20% Airports Airports 16% Toll roads 17% Toll roads Spain Spain 59% 59% 42% 41% Chile Chile 6% 7% 2010 2009 2010 2009 United Kingdom United Kingdom 7% 7% Telecommunications Telecommunications France France 13% 12% 25% 25%
22 AR CSR AA 2.1 Toll roads 2010 has seen the consolidation of abertis autopistas’ management model and a recovery in its traffic. This has been mainly due to an internationalization process that has buttressed its position in France and South America, where the economy is stronger than in other countries. Recovery in traffic through internationalization abertis’s toll road business – the Group’s main activity in terms in 2011 there will be a third lane right up to the French border of turnover and profit/loss– has maintained its key figures over at La Jonquera. the course of the year in an environment that continues to be marked by the decline in economic activity in some of its key Also underway are improvement and widening work on the AP-6 businesses. Traffic, which had been hard hit over the previous toll road, a basic communications corridor between Madrid and months, has slowed its decline over the last few months of the northwest Spain, which will entail the construction of a third year to close 2010 virtually the same as in the previous year. lane in each direction in the San Rafael – Villacastín section. Against this backdrop, this year abertis autopistas has As part of its commitment to improving customer service consolidated its business model and improved its infrastructure and offering the latest in technology, abertis autopistas has with the aim of providing greater service capacity and quality to announced several initiatives that make it into a pioneer in its network. delivering customized solutions. They include the installation of interactive information points and setting up service areas As a result, work has continued on the project to add a third addressed to heavy goods vehicles. lane to the AP-7 toll road, the main corridor along the Iberian Peninsula coastline. A new section has been opened in Girona in In 2010, abertis autopistas has continued to demonstrate its 2010 and work has begun on the final part which will mean that environmental awareness after the agreement reached with the
23 AR CSR AA DIRECt OR shaRED ManagEMEnt COnCEssIOnaIRE COMpanIEs spain France Rest of the world French Government to invest 250 million euros in environmental improvements to infrastructure as part of the “Paquet Vert” in acesa/invicat sanef elqui exchange for extending the term of sapn and sanef concessions aumar sapn rutas del pacífico for another year up to 2029. iberpistas sanef aquitaine1 apr castellana sea14 1 gco abertis has continued to consolidate its leadership in the world aucat Autopista Central road infrastructure management market. It directly operates aulesa gesa1 3,772 kilometres of toll roads in five countries and has a share in avasa opsa1 the operation of another 5,579 kilometres through its presence Trados 45 1. Companies that only provide toll road operation services in concessions in Europe, Latin America and Africa. tELEMatIC COMpanIEs The challenge for abertis autopistas in 2011 is the sustained improvement of its toll road network and customer service. In this spain France Rest of the world respect, further work is to be done to enhance road construction eurotoll slovtoll and route quality in its network along with improved service bet’eire flow quality supplemented by external quality factors that are closely connected with toll road operation such as safety and information. OthER hOLDIngs It is also committed to playing an important role in technological development through driving electronic toll systems and putting spain France Rest of the world in place initiatives that support mobility. Túnel del Cadí A’Lienor Atlantia Accesos de Madrid Alis Brisa Ciralsa Routalis 1 Ausol Autema Coviandes Henarsa RMG Pt operational Services1 Coninvial1 1. Companies that only provide toll road operation services
24 AR CSR AA France abertis is present in the toll road business in France through the One of the key developments in 2010 for sanef has been its over the course of 150 kilometres joins the towns of Langon concessionaire group sanef, in which it holds a 52.55% stake. participation in the “Paquet Vert” measures, one of the largest and Pau in southwest France and has involved an investment of sanef is to manage up to 2029 a total of 1,757 kilometres of public-private partnerships to be sponsored by the French 1,200 million euros. The new toll road, also called the “Autoroute toll roads in north-east France and Normandy (in this region Government. Under the agreement, sanef is to invest a total of de Gascogne”, will significantly improve connections in through its subsidiary sapn), which accounts for 20% of the 250 million euros over three years in projects to improve the southwest France. Construction work began in July 2008 and has French network and 47% of abertis’s toll road network. integration of its infrastructures in the environment and the been completed four years after signing the concession contract services it delivers to its customers. In return the term of sanef’s and two and a half years after starting work. The former road sanef’s network has an excellent position in the centre of two concessions will be extended by a year up to 2029. Through connecting Langon and Pau was known for its twisty route and economic Europe, connecting with five great European capitals these commitments to the environment the company hopes to traffic incidents. Through sanef aquitaine, sanef has taken over (London, Brussels, Luxemburg, Frankfurt and Strasbourg) and make its contribution to the recovery of the French economy. management of the toll road for 60 years. managing five of the seven toll road access routes to the Îlle de These investments are part of a package of measures called the France (Paris) region. “Plan de Rélance” designed to encourage greater economic activity In 2010 the Reims south bypass has also come into service six in the eight regions that sanef’s toll roads cross, thus contributing months ahead of schedule, a groundbreaking project in terms of sanef also manages a number of companies that provide to the economic and industrial development of the areas covered respect for the environment and the use of the latest technology. telematic services, including electronic toll systems in France, by the Group’s network. It is a bypass on the Paris to Strasbourg A-4 toll road which links free flow electronic toll systems in Ireland and satellite-based France to Eastern Europe and will relieve the traffic that used to electronic toll systems in Slovakia. Another milestone in 2010 for sanef has been the opening of the go through Reims. The bypass, which is 14 kilometres long, has A-65 toll road (A’Liénor, in which sanef has a 35% stake), which involved an investment by sanef coming to 245 million euros. DIRECt OR shaRED ManagEMEnt OthER hOLDIngs Concessionaire companies holding Km. Concession end telematic companies holding Company holding Km. Concession end sanef 52.55% 1 1,389 2029 eurotoll 100% A’Lienor 35.00% 150 2066 sapn 99.97% 368 2029 slovtoll 100% Alis 19.67% 125 2067 sea14 2 100.00% bet’eire flow 100% Routalis 1 30.00% sanef aquitaine 3 100.00% 275 1,757 1. Company that operates the A-28 toll road (Alis) 1. abertis has a 52.55% stake in sanef, which has holdings in the other companies 2. Company that operates the A-14 toll road (sapn) 3. Company that operates the A-65 toll road (A’Liénor)
25 AR CSR AA Green commitment: “The “Paquet Vert” programme will enable Odile georges picot us to further our environmental commitment and speed up the sanef group Concessions Manager implementation of new services for our customers” What is the “paquet vert” programme? As part of the French government’s Grenelle de l’Environnement (Socio-political Summit for the Environment) and the “Plan de Rélance” (Economic Recovery Plan), sanef has pledged to invest 250 million euros over the next three years in projects aimed at improving the environmental integration of its infrastructures and the services it delivers to its customers. In return, the sanef group is to benefit from a one-year extension in the length of the two sanef concessions (sanef and sapn) up to 2029. This is a key project in the Group’s development. The programme buttresses our public service mission and our vocation as a long-term infrastructure manager and gives a fresh boost to our responsibility as a company and our positive contribution to the environment. What is the scope of the programme? The “Paquet Vert” enhances the integration of our network in its surroundings and the agreed investment will help to stimulate local jobs in the 8 regions through which it runs. It covers 5 main areas: water, noise, biodiversity, reducing CO2 emissions, and service and rest area facilities. The investment items depend on each aspect. A total of 40 projects have been started up involving more than 20 managers and a lot of workers. The French government has chosen the projects based on how far each one can ramp up our commitment to the environment and to our customers through new services. What are these new services? These investments will provide an important boost to our customer service policy. For example, we will extend an existing service in one of our facilities on the A-29 which helps reduce CO2 emissions into the atmosphere: a no-stop electronic toll for heavy vehicles. We hope to install 7 new toll booths and this accounts for almost half of total “Paquet Vert” investment. We are also planning to install more dynamic equipment which enables improved traffic flows in those places where there is most transit, including real-time information, CCTV and variable information panels. Furthermore, in order to promote carpooling and co-modality, we have created an online portal about interchanges between the motorway and the surrounding area for people and goods at the junction of the A-1 and the “Seine Nord” Europe Canal.
26 AR CSR AA Calais Lille Reims Total km. France 2,032 Strasbourg Caen sanef Paris Alençonfrance Langon A’liénor Pau Direct or shared management Other holdings
27 AR CSR AA Financial and business results Revenues generated from direct-managed toll road concessions The difference between total revenue and toll revenue (133 in France have reached 1,465 million euros and EBITDA totalled million euros) is basically down to sanef group revenue from Revenues from direct-managed 917 million euros, representing 36% and 37% of the abertis telematic services (down over 2009 due to the negative impact toll road concessions in France group’s total respectively. of the sale of Masternaut in April 2009), service area charges and 1,465 telecoms and engineering services. The figures are for HIT/sanef consolidated. By the end of 2010 electronic toll transactions had reached sanef’s toll revenue in 2010 has come to 1,332 million euros, a 36.2% of total vehicles (an annual increase of 1.8 points) with 3.3% increase over 2009. sanef’s AADT in 2010 was up over the heavy vehicles standing at 75.7%. million euros last few months of the year and has risen by 1.3% compared 36% with 2009, in spite of the consequences of the strikes on 11 and In France, 74 million euros has been invested in renewing and 18 June and with a greater improvement in heavy vehicle traffic upgrading the existing network (upgrading toll booths and (+4.9%). network maintenance) and 183 million euros in new construction projects, new lanes and investment in the Reims south bypass, of abertis’s total the widening of the A-13 and the “Paquet Vert”. aaDt COns. REsuLts IFRs (millions of euros) InvEstMEnts (millions of euros) (Contributions to abertis consolidated) 2010 var. % 2010 var. % 2010 sanef 22,845 1.6 Operating revenues 1,465 3.7 Operational investment 74 sapn 28,065 0.5 EBITDA 917 4.7 Expansion investment 183 total aaDt 23,303 1.3 EBIT 560 9.6
28 AR CSR AA spain In Spain, abertis autopistas is the largest toll road operator in operator which, following its purchase in 2009, has now been fully The jury noted that the project means an improvement in the terms of kilometres managed with a total of 1,526 kilometres, incorporated into the business unit’s operations and accounts. systems for getting from the Region of Madrid to the corridors which accounts for 51% of the total of toll roads in the country. Then secondly there has been investment in maintenance and in northwest Spain, as it substantially expands their capacity, As such it participates in a non-majority way in a total of 234 km widening of existing toll roads, including: functionality and safety with a set of three tunnels, one of through other concessions. which can operate in both directions. • On the AP-6 toll road, the upgrading and widening work In Spain, abertis autopistas has experienced a slowdown in aimed at improving road safety and mobility in this key • On the AP-7 toll road network, abertis autopistas has 2010 in the decline in both heavy and light traffic. Although the communications corridor between Madrid and northwest completed work to add a third lane between Maçanet and year ended with a negative result (down 4%), the trend over Spain (Galicia, Asturias, León, Salamanca, etc.). It involves a Fornells. This forms part of the AP-7 road widening project the the last few months of the year suggests that the figures are raft of actions including the construction of a third lane in Group is implementing right along the 125 km between La stabilizing in Spain and a recovery in activity is likely to start in both directions in the San Rafael – Villacastín section and the Jonquera (Girona) and Vila-seca/Salou (Tarragona) intended 2011. widening of several viaducts. The work entails an investment to upgrade the capacity of the road to meet increased traffic of more than 65 million euros and has received a Special volumes and enhance vehicle mobility by eliminating four toll The division has been confronted by numerous challenges. Mention in the category of Best Public Works from the jury barriers. Meanwhile the remaining works are progressing as Firstly there has been the consolidation of the avasa concession for the 2010 Association of Civil Engineers of Madrid Awards. scheduled. • On the C-32 in Catalonia, the coming into service in July of DIRECt OR shaRED ManagEMEnt OthER hOLDIngs the new section between Palafolls and Tordera, a 4.4-kilometre Company holding Km. Concession end Company holding Km. Concession end extension of the motorway which enhances communications acesa/invicat 100% 545 2021 Túnel del Cadí 37.2% 30 2023 in the southern part of the Costa Brava. This project is part of aumar 100% 468 2019 Accesos de Madrid 35.1% 61 2049 the agreement signed between the Government of Catalonia iberpistas 100% 70 20311 Henarsa 30.0% 62 2039 and the concession operator acesa which also includes castellana 100% 51 2031 1 Ciralsa 25.0% 33 2040 building a new spur on the C-32 motorway which has now aucat 100% 47 2039 Autema 23.7% 48 2037 been extended to Lloret de Mar from the future link with the aulesa 100% 38 2055 234 A-2 dual carriageway which the Ministry of Development avasa 100% 294 2026 has planned, and upgrading the existing motorway. Total Trados 45 50% 14 2029 investment comes to 100 million euros. 1,526 1. The concession term may be extended up to 2036 based on actual traffic over the period from 2015 to 2019.
29 AR CSR AA “Work on the AP-6 will result in a first-class infrastructure and make it Ignacio arbilla abertis autopistas possible to deliver extremely high quality service” Centre-south network Manager For the Centre south network, 2010 has meant the start of upgrading and widening work on the ap-6. What does this project mean for the toll road? Instead of the start of upgrading and widening work, I think it is more a case of the fourth stage of the long-term project to improve road connectivity between the centre and northwest of the country that began in 1999. First of all Ávila and Segovia were connected to the high capacity road network. In the second stage the capacity of the AP-6 was increased over a twenty-kilometre stretch between the M-50 and the start of the AP-6 concession in Villalba. Then in the third stage the capacity of the first section of the AP-6, between Villalba and San Rafael, was also increased in a project that included building a third tunnel under the Sierra de Guadarrama. Finally, in the fourth stage which is where we are now, the capacity of the next section of the AP-6, between San Rafael and Villacastín, is to be increased and isolated jobs from the previous stages which were not done at the time will also be completed. Once work in this fourth stage has been finished, I honestly believe that we will have a first-class infrastructure, one which will deliver extremely high quality service to traffic in the coming years. It is undoubtedly a very complex project... What have been the main challenges you have faced? The greatest difficulty we have come across is making the progress of work compatible with traffic needs. We know that the work impacts on traffic on the roads (lane narrowing, speed restrictions and so on) so we always try to ensure the negative effect is as small as possible. The widening to three lanes is being carried out in sections less than five kilometres long and not on both carriageways at the same time, and signage and marking has been stepped up. These measures have proven to be effective due to the close coordination between Civil Works Operations and Engineering. Another difficulty has been the weather, which up to the present has been giving us a break. The average height of the AP-6 toll road is more than one thousand metres, so on average we have a hundred days of ice or snow a year. Under these conditions, any type of planning, however detailed it may be, can always be affected by unexpected setbacks. how have personnel been prepared for this project? The upgrade of our infrastructure is a project that has been carried out over the course of a decade. At this point in time, the people working with iberpistas and castellana management have enormous experience in these kinds of situations. The key thing from my point of view is never to forget that that our goal is to ensure traffic can flow under the best possible conditions. It is hard to pick out a particular group because everyone’s contribution is important. However, as they are most directly engaged in customer service, I would give a special mention to the staff in the Operations Centre and Toll Road Monitoring.
30 AR CSR AA Total km. Spain 1,760 avasa Bilbao La Jonquera Vitoria acesa/invicat Girona Logroño Palafolls León Lleida Astorga Barcelona Zaragoza Tarragona Segovia Adanero Guadalajara Madrid Castellón Ávila Arganda del Reyspain Navalcarnero Valencia Alicante Seville Cadiz Direct or shared management Other holdings
31 AR CSR AA 2010 has also been a year of commitment to road safety and technological integration of the concession operators. As a In spite of the 4% fall in AADT in Spain, in the last few months of improvement for abertis autopistas, particularly in terms result, abertis autopistas now operates uniformly across its the year the decline in traffic has lessened. of technological advances on its roads. This year innovative 5 networks: the GenCat Network (concessions owned by the interactive information points have been installed where the Government of Catalonia), the Mediterranean Network, the Ebro Operating income has been increased, in spite of poorer business customer can get online information about road conditions, Network, the Levante Network and the Centre-South Network. levels, by the effect of the additional 50% contribution by avasa weather forecasts and safety tips. Furthermore, abertis abertis has also set up a new company called invicat in 2010 to (+34 million euros in 2010) and by the partial compensation for autopistas has built specific rest areas for road hauliers equipped manage toll road concessions previously run by acesa and which the AP-7 and Maresme agreements. with tight security measures as part of its commitment to better are owned by the Government of Catalonia. meet its customers’ needs. In the course of the year investment in electronic toll payment Financial and business results devices has continued and at present the use of this system on At the organizational level, the goal of the toll roads business toll roads in Spain as a whole comes to 35.1%, 1.6 percentage division in Spain this year has been to consolidate its network Revenues generated from directly managed toll road concessions points more than last year. Especially significant is avasa, with management model in order to achieve greater business unit in Spain reached 1,365 million euros and EBITDA came to 1,066 41.8% of transactions by electronic toll, as all the concession operational efficiency and vision. This has involved bringing in million euros, representing 33% and 43% of the abertis group’s operator’s discounts and free options are linked to compulsory a new concept in network management that has led to the total respectively. use of this payment system. In 2010 Spanish toll roads have carried out operational investment coming to 54 million euros, mainly in optical fibre installation, improvements to toll, maintenance and rest areas, aaDt COns. REsuLts IFRs (millions of euros) and the repair of structures and bridges. Another 188 million (Contributions to abertis consolidated) euros has been invested in expansion, of which 179 million euros 2010 var. 2010 var. has gone basically for the lane addition and section extension acesa/invicat 31,753 -3.5% Operating revenues 1,365 1.1% work set out above. aumar 19,034 -6.9% EBITDA 1,066 1.3% iberpistas 27,123 -3.3% EBIT 769 -3.1% castellana 7,241 1.5% InvEstMEnts (millions of euros) aucat 26,712 -4.1% aulesa 4,911 -4.0% 2010 avasa 13,447 -0.9% Operational investment 54 total aaDt 22,383 -4.0% Expansion investment 188
32 AR CSR AA Rest of the world Chile Rest of the world: other countries in Latin america and Europe Following the acquisition in 2008 and 2009 of holdings in The internationalization of abertis various concession operators in Chile, abertis has grown to abertis also has a presence in other countries in Latin America autopistas has continued to be successful become one of the country’s main toll road operators with the and Europe, where it manages or has minority shareholdings in this year. Higher economic growth in the direct or shared management of more than 430 kilometres. toll roads in Argentina, Puerto Rico, Colombia, the UK, Portugal economies of Latin America has resulted In 2011 it is to focus on further plans for road infrastructure and Italy. in increased industrial activity and a and connectivity for regional urban and centres and upgrading significant increase in traffic on the roads. existing intercity concessions to provide better and increasingly In Puerto Rico abertis has stepped up its commitment to the Thus the international business of this efficient comprehensive service to users. business by purchasing the remaining 25% not hitherto in its possession of apr, the company which operates the Teodoro unit has helped offset the falls that are Moscoso Bridge concession in San Juan. The operating lifetime continuing to take place in Spain. of this award was extended in 2009 for a period of 17 years up to 2044. DIRECt OR shaRED ManagEMEnt OthER hOLDIngs Company holding Km. Concession end Country Company holding Km. Concession end Country elqui 100.0% 229 2022 Chile Coviandes 40.0% 86 20231 Colombia apr 100.0% 2 2044 Puerto Rico Coninvial 2 40.0% rutas del pacífico 78.9% 141 2024 Chile RMG 33.3% 74 2026 United Kingdom gco 48.6%1 56 2018 Argentina Pt.Operational Services3 33.3% South Africa Autopista Central 28.9% 2 60 2031 Chile Ausol 31.6% 119 2020 Argentina gesa 3 100.0% Grupo Brisa 14.6% 1,378 20354 Portugal opsa4 78.9% Grupo Atlantia5 6.7% 3,413 20384 Italy 488 1. Concession end subject to meeting estimated revenue targets and forecast for 2023. 2. Company that is building Coviandes 3. Company that delivers operational and maintenance services to the South African concessionaire 1. 57.6% of voting rights. Bakwena Platinum Corridor. 2. abertis controls 57.7% of Grupo Invin, which in turn has a 50% stake in Autopista Central. 4. Indicates the end of the concession with a higher relative weight. 3. Company that operates elqui 5. As of 31 December 2010 (sold in 2011). 4. Company that operates rutas del pacífico
33 AR CSR AA “The Teodoro Moscoso Bridge has turned abertis into Luis palazzi a partner of choice for future projects in Puerto Rico Director of toll Roads north america and the rest of the United States” abertis has increased its stake in apr up to 100%. What does the teodoro Moscoso bridge concession in puerto Rico mean for abertis? The purchase of the 25% stake that abertis did not have in Autopistas de Puerto Rico (apr) is a sign of the Group’s confidence in its business in the country. The project started 19 years ago when Autopistas de Puerto Rico S.E. and the Puerto Rico Highways and Transportation Authority executed the Concession Agreement for the Financing, Design, Construction, Operation and Maintenance of the Teodoro Moscoso Bridge in the San Juan metropolitan area. After two years of work and an initial investment of more than $80 million, this infrastructure was opened in 1994 and over the course of nearly 16 years of operation it has served more than 128 million users, becoming synonymous with excellence and quality. In 2010, the Teodoro Moscoso Bridge has generated revenues of nearly $19 million, which is an 8% increase over the previous year. puerto Rico has opted for public-private partnerships as the best way of financing infrastructure. The Government of Puerto Rico has put in place a new public-private partnerships programme through the implementation of Law No. 29 adopted in June 2009. This is an important commitment by the country which sees this type of partnership as an integral part of its governance model and not as a response to a temporary situation. Furthermore, Puerto Rico also offers the necessary ingredients for implementing long-term investment projects: it has a solid legal framework, a stable currency and a clear and consistent government programme. abertis plays a key role here. Its presence over several years and its commitment to the community and the quality of the service provided by the Teodoro Moscoso Bridge have helped to position the group as a world leader in the management of transport infrastructures and a partner of choice for future PPP projects in Puerto Rico and the rest of the United States. An example of abertis’s interest in this market and its commitment to public-private partnerships is the analysis we are currently carrying out for the tender to finance, upgrade, operate and maintain the PR-5 and PR-22 motorways, the latter being the busiest on the island. to what extent is the group’s presence in puerto Rico important from a geostrategic point of view? In 1994 the Teodoro Moscoso Bridge was the first public-private partnership project in operation in the transport sector in the United States. Given the Government’s programme and the features of the new Law that support it, I am convinced that not only does Puerto Rico have the potential to become an attractive market in itself, but that it can also establish itself as a benchmark for other parts of the U.S. and act as an ideal gateway into the rest of the U.S. market.
34 AR CSR AA Peterborough united Kingdom Gloucester RMg Sawtry London Alconbury Cirencester sOuth aMERICa Swindon San Juan EuROpE Bogotá Bogotá Colombia Coviandes OportoChileElqui La Serena Villavicencio portugal Brisa Lisboa Ovalle Italy Atlantia* argentina Los Vilos Ausol autopistas del oeste (gco) Chile Rutas del Pacífico San Fernando San Isidro Santiago Valparaíso Buenos Aires Buenos Aires Santiago Luján Buenos Aires San AntonioChileAutopista Central Bela-Bela aFRICa Zeerust Santiago direct or shared management Pretoria other holdings (*) In 2011 abertis has sold its stake in Atlantia (6.68%) through a Johannersburg private placement process. Johannesburg south africa PT Operational Services
35 AR CSR AA Financial and business results In Colombia, in January 2010 it signed an agreement with the Revenues from directly managed toll road concessions in the In Argentina, in addition to the positive growth in business government to amend the Coviandes concession contract, 40% rest of the world have come to 248 million euros and EBITDA activity (+6.5% AADT) there have also been price increases of owned by abertis, whereby the concessionaire undertakes to stood at 155 million euros, representing in both cases 6% of the 17.25% on average since 14 December 2009, and 20.47% on widen the central segment of the road and carry out safety abertis group’s total. average since 4 October 2010. work costing approximately 650 million euros. This is to be compensated by the government through a combination of The figures have increased significantly and are not comparable In Puerto Rico there has been a price increase of 50% since direct funding and tax benefits. with the previous year due to the impact on the P&L account for 1 January 2010, which has led to an income increase of 10% 2010 of the incorporation of Chilean shares (“Itinere assets”) for despite the drop in traffic of 28.5%. In Europe, abertis has maintained its presence in the Portuguese a full year (6 months in 2009). firm Brisa with a 14.6% stake and where it has a seat on the In 2010 Chilean companies, mainly Autopista Central, have Board of Directors. In 2011 abertis has sold its stake in Atlantia In Chile, business activity has been positive in all concession invested 2 million euros in free-flow toll equipment and (6.68%) through a private placement process in which it made operators, with increases of 4.5% in Autopista Central, 5.6% in improving infrastructure. In Argentina, gco has invested 2 million capital gains. rutas del pacífico and 4.7% in elqui, and with an even greater euros in upgrading toll stations and improving safety. It has also improvement in heavy vehicles. invested 11 million euros in expansion through the acquisition of the remaining 25% of apr. aaDt COns. REsuLts IFRs (millions of euros) (Contributions to abertis consolidated) 2010 var. % 2010 var. % Revenues from direct-managed elqui 4,795 4.7 Operating revenue 248 72.0 toll road concessions in the rest rutas del pacífico 22,879 5.6 EBITDA 155 96.1 of the world 248 gco 73,419 6.5 EBIT 64 688.6 apr 16,549 -28.5 InvEstMEnts (millions of euros) Autopista Central 65,843 4.5 total aaDt 22,820 5.5 2010 Operational investment 4 million euros Expansion investment 11
36 AR CSR AA 2.2 Telecommunications Infrastructures abertis telecom has celebrated its tenth anniversary in 2010 by establishing itself as the leading terrestrial telecommunications infrastructure and services group in Spain. It now has more than 3,300 centres making up the largest network of sites in the country for broadcasting and distributing audiovisual signals. It is also an internationally recognized satellite broadcasting operator through its key holdings in operators Eutelsat and hispasat. Dtt rollout, an unprecedented success in spain 2010 has been the year in which the changeover to digital been a highly complex process in technical, logistic and social terrestrial television (DTT) has been completed, the largest ever (it affects over 46 million people) terms. 58% of the 5,700 DTT technological replacement project to be carried out in Spain and broadcasting centres currently existing in Spain (in other words one of the biggest in Europe. Under the DTT National Technical 3,315 of them) are operated by abertis telecom. Plan, coverage has been provided to 98% and 96% of the population for public and private television services respectively. The project has been completed successfully and almost two years ahead of most countries in Europe. It has involved The progressive rollout since 2005 of a new digital broadcasting the whole abertis telecom organization, with more than 700 network based on existing and new centres to replace the people working on it directly in addition to the participation of analogue network deployed over the previous 50 years has more than 2,000 engineers and outsourced professionals.
37 AR CSR AA “abertis has established itself at home and abroad as an industrial manager Carlos Espinós Managing Director of in the satellites sector” abertis telecom satellite Infrastructures how has the satellites business gone over the course of the year? After four years spent in the satellite communications industry, since January 2007 in Eutelsat and since June 2008 in hispasat, I think it is fair to say that we have established ourselves in this sector in our role as an industrial manager both at home and abroad. We are known and recognized worldwide by the various players in this business. As for developments in the market, we have been pleasantly surprised. Despite the global financial crisis, the development of satellite technology-based activity has maintained its growth rates of previous years. And if forecasts are met, it is expected that growth over the next five years will remain at around 4%. In 2010, the evolution of the satellite division in hispasat and Eutelsat has accounted for over 60% of the company’s net profit. If forecast growth is achieved, it is quite possible that this contribution will grow even more in years to come. 2010 has been a year of significant launches… A satellite launch is always a significant moment in a company’s operations. In late 2009, hispasat launched the satellite Amazonas2 into space which has enabled the company to strengthen its position in the Latin American market. In 2010 we have also successfully launched the 1E satellite which supplements and provides continuity for the 1C and 1D satellites, with a greater focus on the Iberian Peninsula and western Europe. This means that hispasat now has, including Hisdesat satellites, seven satellites that will ensure the continuity and growth of the business. In addition, hispasat and Hisdesat also have a portfolio of five new launches planned that will afford the company an excellent position in the sector. As for Eutelsat, the company has put into orbit the KA-SAT satellite, which is functioning flawlessly and whose cutting-edge technology makes it into a key factor in the future development of Eutelsat. Eutelsat has an impressive order book of seven satellites under construction (W3C, AB7, W5A, W6A, Es’hail, W3D and EB9B) which are opening up an exciting future for the company. What are the challenges the division will have to face over upcoming months? hispasat and Eutelsat are companies that need to continuously adapt to market needs and developments. New trends based on the use of commercial satellite capacity for the provision of military services constitute a huge opportunity and market that until now had been a closed shop. Governments want to bring broadband to every corner of their respective countries and this means that satellites are a key factor for quickly and effectively supplementing terrestrial infrastructures. Eutelsat is a pioneer in this field, as it has put into orbit the first European satellite using Ka-spot beam technology to deliver broadband services. In television, the advent of high definition and 3D broadcasts entails heavy use of satellite capacity. There is a future, there is demand, there is technology and there are capabilities: what more could you want?
38 AR CSR AA Yet abertis telecom has done more than just deploy DTT in In 2010 abertis telecom has continued to develop 2010. Its satellite business has grown strongly and for the first telecommunications services for operators by including new Satellite growth has come not only time this unit is the largest contributor to abertis telecom’s projects for implementing wireless and fibre optic broadband from the increase in new services but results. networks as well as security and emergency radio services such also from its investees Eutelsat and as the ones provided to the Merchant Navy and Sea Rescue. hispasat, which this year have launched Satellite growth has come not only from the increases in new services but also from its investees Eutelsat and hispasat, The challenge for 2011 is the consolidation and growth of the new satellites and are planning to put which this year have launched new satellites and are planning to new services and applications brought by new technologies. In more into space in 2011. put more into space in 2011. the field of DTT, the extension of the 3 new multiplexes will be completed and work will be done to get ready for the arrival of Eutelsat, the leading operator in Europe with a market share of the digital dividend (the reallocation of frequencies) in 2014. As 30% and the third biggest operator in the world, has put into for new services, the focus will be on high-definition television, orbit KA-SAT, a new high-performance satellite that will provide the development of DTT Premium services and driving other new access to broadband via satellite for areas with connectivity products such as 3D television, mobile television and interactive problems. services. In short, these will be new technological advances to which abertis telecom as an independent network operator For its part hispasat, the world’s seventh largest satellite wants to continue to contribute all its capacity for innovation operator by revenue, has launched hispasat 1E which expands and development so as to turn the information society into a the Group’s capacity in Europe, America and Africa and increases reality. its range of high quality services. DIRECt OR shaRED ManagEMEnt OthER hOLDIngs Company holding Centres Company holding Centres abertis telecom 100.00% - Torre Collserola 4.8% - retevisión 100.00% 2,662 sites Eutelsat 31.4% 27 satellites tradia 100.00% 653 sites Cota 25.0% - adesal 51.00% overon 51.00% - hispasat 42.06%1 7 satellites2 1. Includes indirect stake held through Eutelsat 2. Includes 2 Hisdesat satellites
39 AR CSR AA Financial and business results The telecommunications infrastructures business sector brought These figures do not include the contribution of Eutelsat as it is Revenue from in the second highest amount of revenues at 552 million euros consolidated by the equity method. telecommunications and an EBITDA of 218 million euros, which represent 13% and infrastructures 552 9% of the abertis total respectively. In 2010 abertis telecom has carried out operational investment coming to 21 million euros, mainly in replacement investment The telecommunications sector has increased its revenues and operational support for retevisión and tradia. It has also compared to 2009 mainly due to the increased activity in the invested 126 million euros in expansion in the completion of audiovisual segment (digital terrestrial television) and new radio the deployment of DTT and in hispasat in its share in the million euros contracts as well as higher non-recurring income (DTT trading construction of the satellites Hispasat 1E, launched in December 13% extensions). These increases coupled with higher revenues from 2010, Amazon III and Small Geo. satellites (hispasat) offset the reduction in revenues from analogue TV due to the changeover. of abertis’s total COns. REsuLts IFRs (millions of euros) InvEstMEnts (millions of euros) (Contributions to abertis consolidated) 2010 var. % 2010 var. 2010 No. sites 3,315 3.0% Operating revenues 552 1.9% Operational investment 21 No. service centres 63,076 13.8% EBITDA 218 -0.9% Expansion investment 126 EBIT 106 -2.2%
40 AR CSR AA 2.3 Airports In the course of 2010, abertis airports has consolidated its position as one of the benchmark operators in the airport infrastructures sector in the world with operations at 29 airports in Europe, the US and Latin America and overall annual traffic coming to 58 million passengers. a world benchmark operator In spite of the initial upturn of traffic in the airport management such as driving commercial activity with its customers and car business worldwide, the persistence of the economic crisis in parking facilities. some regions and adverse weather conditions with the eruption of the Eyjafjalla volcano in Iceland and snowstorms in the first tbi, the company which was the vehicle used by abertis to enter quarter of the year have meant that the recovery has been the airport sector six years ago, manages eight international uneven across the various countries in which abertis airports airports that it owns or has the concession for in Europe (the operates. UK and Sweden), the United States and Bolivia. In addition it has total or partial management contracts for another five The geographical diversification of the airport management airports in the United States. Over the course of the year, tbi’s division has been successful. Growth in Latin American countries airports have continued to improve their infrastructures. Belfast where it operates has made up for smaller numbers in other International Airport has opened a new, revamped, more modern economies such as the United States and Europe. and spacious terminal this year which is designed to increase the number of passengers and house a greater range of shops. For its Against this backdrop, abertis airports has focused on active part, this year Cardiff airport has presented a plan to refurbish management of its business through pursuing an active policy and expand its terminal in order to increase its shopping facilities of cost control and implementing other activities and services and provide Wales with a more modern facility.
41 AR CSR AA “Investment under the Phoenix Project demonstrates abertis’s John Doran belfast International commitment to the economy and development of Northern Ireland” airport Director What is the phoenix project? The Phoenix Project is the big project for the refurbishment of the terminal that was mapped out in early 2009 in order to put in place a series of major improvements for passengers at Belfast International Airport. The project has a number of key objectives. Firstly we want to build a more “intuitive” flow through the departure terminal to shorten the journey from outside the facility to the boarding gate. Secondly we want to rebalance the terminal space to double the area assigned to retail in the boarding area. We have also sought to create a more modern and spacious atmosphere in the terminal for users and employees alike, bringing natural light into its centre. Finally we have also worked with our commercial partners so that the airport has new products and services that improve the passenger experience. The project was started up in spring 2009 with the relocation of the security control area, which was followed by the construction of a new link between the check-in and security areas. In later stages terminal space was relocated and its structure upgraded. All work phases were planned and implemented in such a way as to ensure continued use of the building while reconstruction work was going on. The renovation was completed in November 2010. What does this extension mean for the airport and for the development of northern Ireland? Tourism and investment are of critical importance for the economic development of Northern Ireland and for many of these visitors, Belfast International Airport is the first impression they will receive of the region when they arrive and the last when they leave. Belfast International Airport is the main air gateway to Northern Ireland and abertis, as a long-term investor in the region, needs to show that it is ramping up its commitment to the regional economy with appropriate investments such as the Phoenix Project. It is also very important for us to show that we are working with the Government to create access routes that open the region’s economy up to the rest of the world. What are the main challenges for the future of belfast International airport? One of the biggest challenges we always face is that Belfast International Airport serves a region on an island in the North Atlantic on the western edge of Europe, which means that most air traffic is outgoing. However, this can also be an opportunity. As we are surrounded by the sea, long-distance connections by rail and road with the rest of Britain and Europe will never be an alternative to flying. Moreover, as the region leaves behind its troubled past and there are signs of an economic recovery, there will be significant opportunities for attracting tourists. In this respect, and in order to create access channels for these visitors, we will have to compete vigorously to attract new airlines.
42 AR CSR AA Through Desarrollo de Concesiones Aeroportuarias (dca), abertis Airport, managed by tbi, has partnered Resource Efficiency East has an interest in a total of 15 airports in Central and Latin to reduce carbon dioxide emissions at the airport. America, specifically in Mexico, Jamaica, Chile and Colombia. Particularly significant is its position in Grupo Aeroportuario del In 2011 abertis airports plans to continue with its policy of Pacífico (GAP), which is the largest private airport operator in consolidating its business to maintain its standing as a major America. airport infrastructure manager, a position that has been recognized not only abroad but also in Spain. In the current dca’s airports have delivered the best performance over the year climate where governments are increasingly interested in public- with significant growth in traffic, due in part to the boost which private partnerships and concessions, abertis airports will Latin American economies continue to provide in comparison continue to explore and analyze new investment opportunities with other markets. sponsored by all levels of government.Particularly significant here is the Spanish Government’s announcement concerning abertis airports, like other divisions in the abertis group, has concessions at major airports including Madrid-Barajas and also upped its commitment to the environment. London Luton Barcelona-El Prat, which abertis airports is examining closely. thROugh tbi* Company holding Owned Concession Management dca 100% - 15 - Location holding Owned Concession Management tbi 90% 3 5 5 United Kingdom (London 100.0% 2 1 - codad 85% - 1 - Luton, Belfast and Cardiff) 3 21 5 Sweden 90.1% 1 - - Florida (USA) 100.0% - 1 - thROugh dca Bolivia 100.0% - 3 - Georgia (USA) 100.0% - - 3 Country holding Concession California (USA) 100.0% - - 1 Jamaica 74.5% 1 North Carolina (USA) 100.0% - - 1 Colombia 33.3% 1 3 5 5 Chile 14.8% 1 Mexico 5.8% 12 15
43 AR CSR AA america usa Raleigh (Durham) Burbank Atlanta Mexicali Herbert Smart Downtown Middle Regional Georgia Tijuana Orlando Sanford Hermosillo La Paz Los Mochis San José del Cabo Manzanillo Aguascalientes Guadalajara Sangster Mexico Puerto Vallarta Bajio Morelia Jamaica Eldorado Cali Colombia El Alto (La Paz) bolivia Jorge Wilstermann (Cochabamba) Viru Viru (Santa Cruz) Santiago Direct or shared management Chile Owned Concession Management contract Other holdings Other holdings
44 AR CSR AA sweden Stockholm Skavsta united Kingdom Belfast International London Lutoneurope Cardiff Airport Direct or shared management Owned Concession Management contract Other holdings Other holdings
45 AR CSR AA Financial and business results Operating revenues The airports sector accounted for 7% of revenue and 3% of 277 abertis group’s EBITDA in 2010. tbi’s activity has been affected by the global economic crisis, adverse weather conditions with the eruption of the Eyjafjalla volcano in Iceland, snowstorms in the first quarter of year, and millions of euros by decisions of airlines that have been reversed in 2011. By contrast dca and Codad have performed well at 8.2% and 13.8% respectively. COns. REsuLts IFRs (MILLIOns OF EuROs) 2010 var. % (Contributions to abertis consolidated)) No. of passengers (thousands) 2010 var. % In spite of the negative development of tbi’s activity, revenue London Luton 8,752 -4.1 Operating revenues 277 5.5 has increased by 5.5% due to tbi’s higher revenue per passenger Belfast International 4,047 -10.8 EBITDA 81 8.1 (+7.9%), a larger contribution by dca (higher rates at Montego Cardiff 1,401 -14.0 EBIT 26 65.9 Bay Jamaica) and the favourable change in the exchange rates Orlando Sanford 1,139 -32.5 for the pound and the dollar against the euro. Stockholm Skavsta 2,489 -0.6 InvEstMEnts (millions of euros) Bolivia 3,690 19.0 The airport sector has invested 31 million euros in 2010. The 2010 total no. of passengers tbi 21,517 -4.7 bulk of this has been in the replacement of the radar systems at Operational investment 28 Belfast and Cardiff, the repair of the apron at Stockholm and the Expansion investment 3 reconfiguration of the land/air side at Belfast. No. of passengers dca group (thousands) Montego Bay (Jamaica) 3,284 1.2 Aerocali (Cali, Colombia) 3,114 23.7 Santiago de Chile 10,161 13.4 GAP (Mexico) 20,223 4.9 total no. of aggregate passengers dca 36,782 8.2 no. of flights codad 149,880 13.8
46 AR CSR AA 2.4 Car Parks saba remains one of the leading operators in the sector in Spain and the rest of the world, managing 128,149 spaces in 195 car parks in Spain, Italy, Chile, Portugal, France and Andorra. Organic growth in spain, international consolidation and commitment to innovation The success of the strategy for entry into the airport car park Growth has also been strengthened in Spain with a new owned segment with new contracts at Pamplona and Almeria airports, car park in Palma de Mallorca. The facility is located right in the increased internationalization with new spaces in Italy and heart of the old quarter and has a capacity of 284 spaces. Chile, and a commitment to innovation and technological advancement have been the key features of 2010 for abertis’s Abroad there has been asset turnover with growth in Italy and car parks business. the departure from Morocco. In Italy, saba has reinforced its leading position with the opening of a new car park in Pisa. In the Spanish market saba has established itself as one of the With these new facilities, the Group now has a total of more major players in airport car park management. This year it has than 26,200 spaces in the country. landed car park management contract awards at Almeria and Pamplona airports to add to the ones it has at Barcelona-El Prat, In Chile, the upgrading and modernization of the Providencia, Girona, Reus and Tenerife South. In total, the Group manages Plaza de la Ciudadanía, Plaza de las Armas and Tribunales facilities 37,126 spaces at Spanish airports. It also holds the concession has strengthened saba’s position in a country that is strategic for for 635 spaces at Brindisi airport in Italy. the Group and in which it already has a total of 15 car parks with a combined capacity of nearly 9,000 spaces.
47 AR CSR AA Financial and business results The company’s progress in 2010 has also The car park sector accounts for 4% of abertis’s operating revenues and reached 154 been shaped by other factors such as million euros. Its contribution to consolidated EBITDA was 64 million euros, which is 3% innovation, the use of new technologies of the abertis total. and a concern to meet the social needs of efficiency and environmental The addition of new car parks and spaces (expansion in Spain and Italy and new sustainability. management contracts) together with the rise in rates are the factors behind the increase in car sector figures in 2010. They help to offset the slightly negative evolution of business operations on a like-for-like basis and average length of stay. Over the course of the year saba has carried out expansion investment coming to 29 million euros in Spain, with the acquisition of its car park in Palma de Mallorca, and in Italy, with the construction of 14 new car parks. In addition, it has carried out operational investment in system repairs, upkeep and maintenance coming to 7 million euros. COns. REsuLts IFRs (millions of euros) *Country ( ) holding no. of spaces no. of cities abertis participa en un 99,46% en saba aparcamientos, que es la que participa en el resto de 2010 var. % sociedades. (Contributions to abertis consolidated) ( ** accionariado compuesto al 50% por Spain ) 99.48% 1 sociedades controladas por el grupo abertis, en total abertis 73,302 46 ostenta el 76,01% de saba-sanef parkings No. of car parks 195 -0.5% 2010 var. % Portugal 100.00% 17,796 8 No. of spaces 128,149 -0.1% Operating revenues 154 2.8% Italy 100.00% 26,206 20 No. of short-stay vehicles (millions) 56.3 0.0% EBITDA 64 9.3% Chile 100.00% 8,942 3 No. of season ticket holders 34,261 -0.6% EBIT 34 -1.0% France 76.28%2 1,042 1 For the purposes of the car park business, in addition to the saba group 100% of saba sanef Parkings (50% commercially dependent on sanef) is included. Andorra 60.00% 861 2 InvEstMEnts (millions of euros) 128,149 80 2010 1. abertis has a 99.48% stake in saba, which in turn has holdings in the other companies. Operational investment 7 2. 50% of shareholder structure made up of companies controlled by the abertis group; in total aber- tis holds 76.28% of saba-sanef car parks Expansion investment 29
america48 AR CSR AA the number of cities in which saba is present in a country is indicated for each country. there may be one or more sites in each city. Chile (3)europe France (1) Andorra (2) Spain (46) Portugal (8) Italy (20)
49 AR CSR AA “The investment carried out in saba’s facilities in Chile in 2010 has made it Jean François possible to enhance the technology, safety and convenience of our car parks” Mousset gerente general saba Chile What improvements has saba Chile made to its car parks in 2010? During 2010 we have carried out a major and highly efficient programme of investment and improvements in the car parks that saba manages in the capital of the country. Specifically this has been in the districts of Providencia and Santiago-Centro and it has involved investment of more than 2 million euros. With this strategy we are seeking to standardize our network of car parks, providing more technology, safety and comfort to the more than 12,000 users we serve on a daily basis. The programme began in Providencia and it is to be expanded to our other facilities in 2011. It involves the renewal of saba’s corporate image, the introduction of automatic pay stations and improved pedestrian access Furthermore, in the Plaza de la Ciuda- danía and Plaza de Armas car parks in the centre of Santiago we have installed access control systems based on Chipcoin technology which consists of an electronic token that is used as an alternative to the traditional paper ticket. Plus I would also like to underline the improvement and upgrading work that we have carried out in our car parks to repair the damage caused by the earthquake that struck Chile in 2010. Our car parks were not seriously affected and they all remained fully operational except for two in Concepción, an area near the epicentre, which came back into service in 30 days in the case of Tribunales and 70 for Catedral. The saba Chile team has done an excellent job in dealing with the challenge created by the earthquake. What change has there been in saba’s car park portfolio in 2010? At the start of the year the Plaza de los Tribunales de Justicia car park in Concepción came into service, which means that with the Catedral car park we now have more than 800 spaces in the city. Plus at the end of 2010 we renewed our management contract with Clínica las Condes. The renewal of this contract means we have met the customer’s requirements with a first-rate integrated solution for managing the entire infrastructure of car parks at Clínica las Condes, the first Chilean hospital to be credentialed by the Joint Commission International. What are the main future challenges in the car park sector in Chile and what role do you think saba can play in the country to help with its development? The country’s economic indicators show that we have got to continue with our development policy of expanding our presence in Chile. Personally I would concentrate on two areas: firstly, consolidating our leadership in the concession sector, and then secondly ramping up saba quality as a differentiating factor through an ongoing policy of bringing in cutting-edge technology, as this is an increasingly relevant consideration when choosing which car park to use. Here I am particularly thinking about the use or inclusion of TAG technology (ViaT in Spain) in our car parks as over 95% of motor vehicles in the country’s capital are equipped with the device.
50 AR CSR AA 2.5 Logistics Parks abertis logística is abertis’s business unit which focuses on the promotion, development, management and use of logistics parks in Spain, Portugal and Chile. Consolidation in spain and good prospects abroad 2010 has been the year of the final internationalization of this background, abertis logística has made special efforts to abertis logística. In addition to growth in occupancy rates and market the extension of abertis logisticspark coslada (Coslada the number of contracts in Spain and the consolidation of its II) located in the Corredor del Henares, the main hub for economic business in the Central region, it has also inaugurated its park development and logistics in the Madrid metropolitan area. In in Chile, which opened with 100% of its space leased. This is Catalonia logistics parks have benefited from the recovery in the result of a firm commitment to intermodal logistics park exports and traffic in the Port of Barcelona, and in Seville the management, tailored to meet the needs of its customers and Logistics Activities Zone (ZAL) has reached an occupancy rate of sited in the most strategic locations. more than 75%. In Portugal, progress has been made in the abertis logisticspark At the corporate level, the final structure of the Consorci de lisboa project, the first facility of its kind in the country, sited a Parcs Logístics (cpl) has been concluded in 2010. This is a project mere 30 km from the capital and near the country’s main road that combines the capabilities of abertis logística and the Port and rail junctions. Authority of Barcelona for the promotion and implementation of logistics activities in Catalonia and its area of influence. As a In Spain, after adjustment quarters in both occupancy and prices, consequence of this operation, abertis has increased its stake in the industry has experienced a modest upturn in demand. Against cpl to 64.5% and in Cilsa to 44%.
51 AR CSR AA In 2010, abertis logística has obtained ISO 14001:2004 DIRECt OR shaRED ManagEMEnt certification for the Environmental Management System used in its logistics infrastructure development and management Company % holding Logistics parks City total surface Current status area (hectares) business, encompassing all the company’s operations. CIM Vallès (services area) Barcelona 7.0 Operational Furthermore, the abertis logisticspark penedès and the Under Zona de Equipamientos CIM Vallès logistics parks have abertis logisticscenter camarma Madrid 8.0 construction also obtained ISO 14001 and 9001 certification for their abertis logística 100.0 abertis logisticscenter henares Madrid 11.0 Under construction environmental and quality management systems respectively. abertis logisticscpark penedés Barcelona 14.0 Operational abertis logisticscpark coslada Madrid 10.7 Operational Financial and business results Operational / Under Chile logística 100.0 abertis logisticscpark santiago Chile 63.3 construction The logistics services business unit contributed operating re- abertis portugal Logística 100.0 abertis logisticscpark lisboa Portugal 100.0 Under construction venues of 35 million euros and EBITDA of 23 million euros to Operational / Under abertis. Both figures represent 1% of the group’s totals. sevisur 60.0 zal puerto de sevilla Seville 54.0 construction Operational / Under Parc Logístic Zona Franca 50.0 Parc Logístic Zona Franca Barcelona 41.0 construction In 2010, changes in the P&L account have been positively Operational / Under affected by the corporate restructuring of the cpl group that Arasur 44.0 Arasur Alava 188.0 construction has led to a fair value revaluation of Cilsa’s historical 32%, Zal Barcelona and Zal Prat Barcelona 213.0 Operational / Under construction generating a positive impact on income and EBITDA of 14 Cilsa* 28.4 Operational / Under million euros. This impact more than offsets the non-conso- Zal Toulouse France 20.0 construction lidation of Areamed, which since late 2009 has been part of 730 the toll roads unit. * abertis controls 64.50% of the holding company cpl, which in turn has a 44% stake in Cilsa COns. REsuLts IFRs (millions of euros) 2010 var. (Contributions to abertis consolidated) There has been an increase in gross floor area with the com- m2 units and offices built 534,407 4.5% 2010 var. missioning of the first industrial unit in Santiago de Chile, % average occupancy 65,6% -9.4 Operating revenues 35 17.7% although average occupancy has fallen as a result of the eco- nomic crisis. As this is a sector that is being developed, the EBITDA 23 94.6% InvEstMEnts (millions of euros) main investments have been for expansion projects for a total EBIT 1 -65.3% 2010 of 26 million euros, with the chief investments being at Chile Operational Investment 1 and Portugal. Expansion Investment 26
52 europe AR CSR AA Chile abertis logisticspark santiago France america abertis logisticscenter camarma abertis logisticspark coslada (I) abertis logisticspark coslada (II) abertis logisticscenter henares Arasur ZAL Toulouse Spain CIM vallès abertis logisticspark penedès pLZF Zal barcelona Zal prat Portugal abertis logisticspark lisboa ZaL puerto de sevilla
53 AR CSR AA “The product we are offering at Coslada has some very specific features Manuel Miranda abertis logística Central Zone and this has enabled us to gain five new customers in 2010” Manager how would you rate 2010 for abertis Logisticspark Coslada? 2010 has been a year of continuing challenges and hectic activity which, thanks to the efforts of the people at abertis logística and especially in the Central Zone, has turned into a year in which we have achieved first-class results. In particular I would mention the extension of contracts with Madrid City Council and the Social Security Treasury Office together with the entry of five new customers into the logistics park in the shape of MRW, Grupo Microma, Lince Envíos, Fagor and Incedere. This has enabled us to end the year with a park occupancy rate of 65%. how has the market reacted to the product offered by abertis logística in the Central Zone? The product that we are currently marketing in Coslada has some very specific features that mean it is a park people know about and recognize. Firstly we meet the basic requirement for any logistics asset which is having a matchless location; there are superb road links between the M-40 and M-50 orbital roads, we are right next to the A-2, the dry port and Madrid airport are nearby and we have connections with the local metro and commuter trains. Another feature is the flexibility of our units with floor areas ranging from 1,200 m2 to 10,000 m2. Finally, I would pick out the customer services provided by the park as another distinctive factor which allows our customers to concentrate on their businesses and share expenses with their neighbours. These three features have enabled us to define our potential customers. What are abertis logística’s main challenges for the future in the Central Zone? Our main challenge in the Central Zone is to become a leader in the logistics market, and doing that involves three things. Firstly we have to complete the marketing of our Coslada parks, secondly we need to get actively involved in logistics development plans with government, specifically through Madrid Plataforma Logística (MPL), and finally we have to develop the San Fernando and Camarma logistics parks when market conditions make this advisable.
r csr csr csr csr csr csr csr csr c Letter from the Chairman Interview with the CEO Corporate governance and management bodies 1.1 Corporate administration 1.2 Administrative bodies abertis group business activities 2.1 Toll roads 2.2 Telecommunications Infrastructures 2.3 Airports 2.4 Car Parks 2.5 Logistics Parks Corporate social responsibility 3.1 abertis’s Strategic Plan 3.2 Indicators 2010 Economic and financial information 4.1 Consolidated figures 4.2 Financial management 4.3 Shareholders and the stock market
56 AR CSR AA 3.1 abertis’s Strategic Plan an overview of CsR at abertis • Throughout 2010, abertis received various awards, including this year, in which the management development and skills Silver Class status in the industrial transport sector, awarded management programmes have continued, as have the training by Sustainable Asset Management (SAM) for its sustainability plans and the extension of the risk management systems. record during 2010-11, and the Honos award for its record in protecting archaeological heritage, awarded by the Catalan • Investment in environmental initiatives has remained constant, Institute of Classical Archaeology. continuing with the extension of environmental management systems according to ISO 14001, the energy saving and • During 2010 the text of the abertis Code of Ethics was redrafted, efficiency actions and environmental awareness and education, in order to improve its dissemination and implementation at obtaining significant reductions. international level and make it easier to adapt to applicable legislation in the countries in which the Group operates. • The Purchasing Committee promoted the new supplier approval protocol, which includes a classification of suppliers according • The additional services offered in service provision, the customer to their CSR activities and results. service provided through new technologies and road safety campaigns, among others, have contributed to maintaining • Relations with local communities have been consolidated customer satisfaction rates. through two lines of action: long-term agreements with community organisations and sponsorship management, • Retaining talent, employee satisfaction and the health and increasing the total number of projects received by 90%. safety of employees have been the main areas of action
57 AR CSR AA “The goal is to cut energy use at the airports managed by abertis in Britain adrià Canals Macià Infrastructures Manager at by 15% in 3 years” abertis airports What is the CRC programme and what is its purpose? The CRC (Carbon Reduction Commitment) is a programme developed by the British government to control carbon emissions from energy sources used by businesses. These sources include electricity, gas and fuels used for heating and electricity generation (not for vehicles). This programme requires companies to measure their carbon footprint and buy emission permits (12 GBP per ton of CO2 produced). It is planned to publish a league table of companies based on their emissions which is designed to encourage companies even further as they will want to maintain a good reputation. The programme began with signing up for it in April 2010 and the first milestone in October 2011 is the publication of the first table of companies. The first payment is scheduled for April 2012. In the first year, companies are to focus on identifying and measuring in detail their carbon emissions from their various energy sources. The British government is one of the pioneers in the introduction of environmental policies to combat global warming. The CRC is designed to encourage businesses to be more energy efficient and reduce CO2 emissions. What steps have been taken to adapt to this new environmental tax initiative put in place by the british government? abertis airports management sees this programme as an opportunity to review our energy strategy and evaluate options for reducing our energy use. It’s a programme we are carrying out in coordination with abertis’s CSR strategy. It is important to stress that airports are facilities that use energy on a continuous basis 24 hours a day, 365 days a year. The cost of the electricity that produces the equivalent of one tonne of CO2 is more than 100 GBP, and comes to 133 GBP in Belfast where electricity is more expensive. The programme means adding 12 GBP to this cost, which remains significant but nonetheless energy saving measures must take precedence, especially in terms of greater efficiency. The plan we have outlined aims to cut our energy use by 15% in 3 years and includes 3 key areas: a review of the technologies we currently use and their replacement by more efficient new technologies, bringing in new equipment maintenance practice, and a review of employee training programmes. What’s your view of this initiative and what are its prospects for the future? This initiative has involved working efficiently and in a cross-cutting way at abertis. Firstly, we have sought out a common strategy for all three airports, London Luton, Belfast International and Cardiff, from the technical standpoint, and we have plans to share experiences to ensure the implementation of best practice. Then secondly we have worked with abertis to use the Group’s energy education programmes (aristos), which the Group has made available to its business units, to smooth the way for this cultural shift toward more efficient habits and enhance the identification of staff in the UK with abertis.
58 AR CSR AA the abertis foundation: a catalyst abertis chairs Throughout 2010, the abertis foundation has become an agent for The abertis - upC chair in transport Infrastructure Management. This chair engages in teaching and research activities in the field road safety and for increasing and spreading awareness. Significant of transport infrastructure management. events include the opening of the foundation’s French headquarters and the commencement of activities in Chile, as well as the The abertis - IEsE chair in Regulation, powers and public policy. During 2010, it continued to generate ideas and disseminate establishment of a collaboration agreement with Rome City Council knowledge in the areas of regulation, powers and public policy. to improve road safety, the consolidation of Volunteer Day and the award of the Silver Medal of Merit for Road Safety by the Ministry The abertis - EsaDE Chair in Leaderships and Democratic governance. The aim of this chair is to analyse models of governance of the Interior. for enterprise, public and community agencies, as well as to study and foster innovative leadership formulas capable of addressing the challenges of today’s society. Along the same lines, the “You’ve got one life left - don’t lose it on the road” campaign was extended to Madrid, while the TV The abertis - FEDEa chair in Infrastructure and transport Economics. The objectives of this chair are to foster research in the field programme “Espai Terra”, about nature, the environment and of infrastructure and transport economics, as well as the dissemination of associated studies. traditions linked to the land has won prizes, an audience and renown. The abertis - LuMsa chair, abertis’s first experience of university-business knowledge transfer outside of Spain, presented its first programme of activities in Rome last December, with the theme Sustainable Management and Innovation. Awareness-raising during 2010 included various publications, the continuation of guided tours at the foundation’s headquarters, The abertis - EnpC-IFsttaR chair, created jointly by the abertis foundation and l’École des Ponts ParisTech - IFSTTAR (Institut Castellet Castle, and the creation of a new university chair in Français des Sciences et Technologies des Transports, de l’Aménagement et des Réseaux) focuses on training and research in transport collaboration with the French government. infrastructure management.
59 AR CSR AA 3.2 Summary of Indicators 2010 CsR stRatEgy anD MOnItORIng InvEstMEnt COMMunIty Indicators compiled >200 Management agencies 262 % turnover included within the scope of the CSR strategic plan 94% Shareholder opinions and enquires attended to 7,363 CustOMERs suppLIERs Turnover with an implemented quality system 91% Number of suppliers evaluated under social 2,198 and environmental criteria Customer satisfaction index 7.6 Percentage of tenders with social and environmental clauses 95% Enquiries, complaints and suggestions attended to 97% Local purchasing percentage 91% EnvIROnMEnt COMMunIty Turnover with an implemented environmental management system 94% Contribution to the community (as a percentage of consolidated net 1.2% Tonnes of CO2 (per million euros of turnover) 50.64 profit) Use of electronic tolls (as a percentage of total transactions) 32% Projects approved by the Sponsorship Committee 128 Waste recovered (as a percentage of total waste generated) 87% Investment in social accessibility and economic development (as a 47% percentage of total contribution to the community) Environmental investment (as a percentage of consolidated net pro- 4.7% Associations and groups actively partnered by abertis 195 fit) huMan REsOuRCEs Women in the workforce (as a percentage of total workforce) 26% Employees on indefinite contracts (as a percentage of total workforce) 87% Resources invested in training €3,987,568 Average hours of training per employee 19.1 Turnover with an implemented workplace health and safety system 90% Disabled workers recruited (directly and indirectly) 1.98%
al economic and financial eco Letter from the Chairman Interview with the CEO Corporate governance and management bodies 1.1 Corporate administration 1.2 Administrative bodies abertis group business activities 2.1 Toll roads 2.2 Telecommunications Infrastructures 2.3 Airports 2.4 Car Parks 2.5 Logistics Parks Corporate social responsibility 3.1 abertis’s Strategic Plan 3.2 Indicators 2010 Economic and financial information 4.1 Consolidated figures 4.2 Financial management 4.3 Shareholders and the stock market
62 AR CSR AA 4.1 Consolidated figures Results First accounts adapted to IFRIC12 dated 1 January 2010. The prices over the course of the year have offset the negative evolution 2009 P&L account has been modified for comparison purposes. of traffic on Spanish toll roads and the slight fall in the airport sector business, affected by other non-recurring factors (impact of The profit results for abertis in 2010 were 662 million, which is the ash cloud from the Icelandic volcano Eyjafjalla). This, together an increase of +6.1% over the previous year. with a higher contribution from equity method companies, led to a 6.1% increase in results, despite higher amortization and a rise in The positive growth of abertis toll roads in France and other the negative financial result due to the acquisitions made in June countries (mainly in Chile), increased telecommunications sector 2009 (basically an additional 50% of avasa and rutas del pacífico business, the positive impact of compensation for the AP-7 and and an additional 75% of elqui, which are now all consolidated Maresme agreements and, to a lesser extent, minor changes to using the full consolidation method). (in millions of euros) Consolidated 2010 2009 vaR Operating revenues 4,106 3,904 5% Operating expenses (1,611) (1,548) 4% EbItDa 2,494 2,356 6% Amortization and impairment losses (975) (911) Operating profit 1,519 1,445 5% Financial result (667) (587) Equity method companies 117 77 pre-tax profit 969 936 4% Corporate Tax (226) (252) profit for the year 743 684 9% Minority interest (82) (60) profit attributable to shareholders 662 624 6.1%
63 AR CSR AA Revenues +5% +6% +5% +6.1% Operating revenues came to 4,106 million euros, which is a +5% In general there have been no significant rise over the preceding year. changes in the relative weight of revenue 3,904 4,106 2,356 2,494 1,445 1,519 624 662 generated outside Spain and the weight 4,500 This increase is due to the positive evolution of operations in of the various business units. 4,000 terms of geographic diversification (especially in the case of 3,500 abertis toll roads in France and Chile) and by sectors (particularly 3,000 in the case of the telecommunications sector as a result of the gross trading margin (EbItDa) 2,500 completion of the rollout of Digital Terrestrial Television), price 2,000 reviews and consolidation for a full year of the figures of Avasa, Operating expenses are concentrated in 1,500 rutas del pacífico (until 30 June 2009 they were consolidated personnel and maintenance of infrastructure 1,000 using the proportional method) and elqui (until 30 June 2009 costs and have increased by 4%, mainly due 500 0 recognized by the equity method). These positive impacts have to the impact over a full year of acquisitions Operating revenue EBITDA EBIT Profit shareholders offset the decline in activity in abertis’s toll roads in Spain, made in 2009 and the performance of 2009 airports (also hit by weather factors) and logistics parks. trading operations (in toll road construction 2010 OpERatIng REvEnuEs (millIons of euros) OpERatIng REvEnuEs (millIons of euros) 2010 % 2009 % 2010 % 2009 % Toll roads 3,078 75% 2,907 74% Spain 2,051 50% 2,026 52% Telecommunications 552 13% 541 14% France 1,444 35% 1,388 36% Airports 277 7% 263 7% Great Britain 177 4% 166 4% Car parks 154 4% 150 4% Chile 192 5% 113 3% Logistics services 35 1% 30 1% Rest of the world 241 6% 211 5% Corporate and other services 9 0% 12 0% tOtaL 4,106 100% 3,904 100% tOtaL 4,106 100% 3,904 100%
64 AR CSR AA and extending DTT coverage) with lower margins than usual. results of these tests on goodwill in the abertis group have not led Equity method companies Nonetheless, all these effects are partly offset by measures taken to to the need to carry out any form of significant adjustment. improve efficiency and streamline operating costs giving an EBITDA The results of companies consolidated by the equity accounting margin at year-end of 60.8%. Financial result method have been enhanced by the positive performance of Eutelsat and Coviandes over the course of the year which has led The average workforce in 2010 was 12,401 employees, with the relative The increase in the negative financial result is mainly due to the to a significant improvement. weight of employees outside Spain being maintained. increase in the financial burden derived from the acquisitions made by the Group in 2009, the one-off impact of refinancing Corporation tax amortisation and impairment of assets and to other non-recurrent impacts (provision for recoverability of equity loans). In 2010 corporation tax expense has been affected by the non- Despite the positive impact on the amortizations recorded in sanef recurring positive impact of +6 million euros as a result of a cut through the one-year extension to its concession term following However, it should be pointed out that the increase in the financial in the corporation tax rate in the UK (from 28% to 27%) from the “Paquet Vert” agreement, there has been an increase in burden derived from the impacts referred to above has been 2011 and which affects both the P&L account and outstanding amortizations mainly due to the inclusion of the new acquisitions reduced by the fall in interest rates during the first half of the year liabilities balances. Aside from this there is no significant change in made in 2009 and impairment provisions for two logistics assets. compared to the first half of 2009, with a significant impact on the effective rate as a result of the maintenance of pre-tax profits floating rate borrowings which at the close of 2010 stood at 16% subject to taxation (the results of companies consolidated by the The operating revenues under IFRS were not amortised of the total. In addition, it should be noted that 2009 included equity accounting method are taxed at source). systematically, although they did depreciate, based on the result of the non-recurrent positive impact of exchange rate differences in the depreciation tests which had to be carried out on them. The Chile. EbItDa (millions of euros) EbItDa (millions of euros) gROss Cash FLOW (millions of euros) 2010 % 2009 % 2010 % 2009 % 2010 2009 var Toll roads 2,138 86% 2,007 85% Spain 1,317 53% 1,306 55% Gross cash flow 1,616 1,502 7.6% Telecommunications 218 9% 219 9% France 917 37% 878 37% Airports 81 3% 75 3% Great Britain 48 2% 41 2% Car parks 64 3% 59 2% Chile 130 5% 73 3% Logistics services 23 1% 12 1% Rest of the world 83 3% 59 3% Corporate and other services -30 -1% -17 -1% tOtaL 2,494 100% 2,356 100% tOtaL 2,494 100% 2,356 100%
65 AR CSR AA assEts LIabILItIEs Cash flow Tangible and 59% intangible fixed Other assets Other assets 24% liabilities 19% Net equity In 2010, abertis generated a gross cash flow (before investments and dividends) of 1,616 million euros, which is 7.6% higher than 21% the previous year. 2006 2006 Debt balance sheet 60% Goodwill 17% The most notable changes for the year are mainly due to the impact of the marking to market of Brisa and Atlantia (in other non-current assets and assets held for sale) and the inclusion of apr and Cilsa assets (in the latter case due to corporate restructuring in the logistics sector which has grouped some (in millions of euros) logistics hubs in Catalonia and the Port of Barcelona hinterland assEts Consolidated LIabILItIEs Consolidated in the south-west Mediterranean arc into cpl, as a result of which 2010 2009 2010 2009 abertis, with effect on 31 December 2010, has a stake of 64.5% Non-current assets 23,214 23,620 Net equity 5,453 5,334 in cpl and increased its holding in Cilsa from 32% to 44%, which Tangible fixed assets 2,325 2,184 Capital and premium 2,376 2,374 then became proportionally consolidated). Goodwill 4,398 4,350 Reserves 983 1,002 Other intangible assets 12,550 12,672 Results 662 624 Holdings in associates 1,461 1,374 Minority interest 1,433 1,334 It should also be noted that at year-end the value of its holding Other non-current assets 2,480 3,039 in Atlantia has been transferred to the item “Assets held for sale”. This is because of the decision by the abertis Executive Non-current liabilities 17,545 17,109 Committee at its last meeting in 2010 to approve the divestiture Debt 14,238 13,837 of this holding, which was completed on 14 January 2011 with Other non-current liabilities 3,307 3,272 its sale for 626 million euros. Current assets 1,466 1,253 Current liabilities 2,293 2,429 Debt 895 1,094 Total assets as of 31 December 2010 came to 25,292 million Assets held for sale 612 Other non-current liabilities 1,398 1,335 euros, which is a 2% increase over the previous year. Some total assets 25,292 24,873 total liabilities 25,292 24,873
66 AR CSR AA 60% of total assets consists of tangible fixed assets and other Investments intangible assets (excluding goodwill), basically concessions, in line with the nature of the Group’s businesses connected with In 2010 the group invested 757 million euros, of which 564 • Expansion investment in car parks has taken place mostly infrastructure management, a percentage figure which is in line million or 75% have gone on expansion projects and the in Spain (in particular the acquisition of a car park in Palma with the one for the previous year. remaining 192 million euros on operational investment. de Mallorca) and Italy (with the construction of 14 new The most significant investments in expansion in the year have car parks). Consolidated stockholder’s equity came to 5,453 million euros, been as follows: • Major expansion investment projects in logistics parks 2.2% higher than in the previous year mainly resulting from • In toll roads, expansion investment has chiefly been carried have included the urbanization work done at the Lisbon the retained earnings for the year and the positive impact of out by acesa (€171 million), mostly on work done to add and Santiago de Chile logistics parks (the latter came into currency translation differences arising during the year, which a lane to the south and north sections of the AP-7 and service at the end of the year). offset the lower value recorded in those financial investments building the Palafolls-Tordera section on the C-32, and by that have to be marked to market (-257 million euros) and the sanef (€183 million), largely on new construction (Reims The most significant operational investments have taken place additional dividend paid in 2009. south bypass), new lanes (A13 Beuzeville-Pônt l’Êvèque) in the toll road sector, especially at sanef, acesa and aumar, and investment under the “Paquet Vert” scheme. at a total cost of 131 million euros. Investments have mostly Gross indebtedness has risen from 14,932 million euros in 2009 • In telecommunications infrastructures, expansion been undertaken in terms of the renewal of tolls, safety barriers to 15,134 million euros in 2010. This 202 million euro increase investment has mostly been for the deployment and and the modernisation of the existing network. Mention should is due mostly to the impact of the aforementioned additions extension of DTT coverage across the country and also be made of investment in the telecommunications sector, to the scope of consolidation and the impact of the €/Chilean hispasat’s investment in satellites. mainly in replacement investment and operational support for peso exchange rate on borrowings by toll road concessionaire • Expansion investment for the year in airports has been retevisión and tradia, while in the airports sector there has companies in Chile, partially offset by the cash flow generated carried out by tbi, basically in the restructuring of the land been investment in the maintenance and replacement of radar during the financial period. Gross debt accounts for 60% of and airside at Belfast and the access to terminals at Belfast systems at Belfast and Cardiff and the repair of the apron at liability, a figure which is similar to the one at the end of 2009. and Cardiff. Stockholm. In line with the policy of minimising exposure to financial risk, at the end of the year a major part of debt (84%) was at a fixed InvEstMEnts (millIons of euros) rate or fixed through hedging. Investments Operational % Expansion % total Toll roads 131 68% 381 68% 512 Telecommunications 21 11% 126 22% 147 Airports 28 15% 3 0% 31 Car parks 7 4% 29 5% 36 Logistics 1 1% 26 5% 27 Holding/serviabertis 4 2% 0 0% 4 tOtaL 192 100% 564 100% 757
67 AR CSR AA 4.2 Financial management In 2010 abertis has continued to consolidate the growth it has achieved over recent years. Thanks to its constant ability to generate cash, abertis has been Financial structure / Financing policy able to continue investing in organic growth coming to 564 million euros, reducing like-for-like borrowings, and obtain new In 2010, abertis has maintained its financial structure in keeping financing to strengthen its liquidity position. with its conservative profile to take long-term borrowings up to 96% as opposed to 94% in 2009. Nonetheless, at the end of The group’s net debt came to 14,651 million euros compared the year, finance obtained from non-bank sources stood at 66% to 14,590 million euros in 2009 due to the inclusion of apr and (69% in 2009). Centro Intermodal de Logística, S.A. in its scope of consolidation, and which has entailed an increase of 184 million euros. Over the course of 2010 Abertis Infraestructuras, S.A. has taken out loans amounting to 575 million euros, including 275 million euros from the European Investment Bank (EIB), and of which 175 million euros are available at year end. (in millions of euros) 2010 2009 Average debt maturity in 2010 stands at 6.55 years (7.19 years Net debt 14,651 14,590 in 2009). Net debt / EBITDA 5.9 6.2 Net debt / Equity 2.7 2.7 In 2010 the sixth programme of issues of promissory notes for FFO interest hedging / Net interest 2.4 2.8 a maximum outstanding balance of 1,000 million euros with 1-year validity was registered with the Spanish Securities Market Commission.
68 AR CSR AA FInanCIng InstRuMEnts 2010 FInanCIng InstRuMEnts 2009 Commercial notes Facilities Facilities Loans Loans 1.7% 1.7% 2.3% Bonds Bonds 6.1% 4.9% 44.4% 43.0% EIB loans EIB loans 9.3% 9.1% CNA CNA 12.5% 15.0% Syndicated loans 25.4% Syndicated loans 24.7% DEbt MatuRIty typE OF DEbt Less than 1 year 4% Floating Between 1 and 3 16% Fixed 27% years Over 10 84% years 25% Between 3 and 5 13% years Between 5 and 10 years 31%
69 AR CSR AA hedging of financial risks Liquidity Risk Credit rating The Group’s activities entail several different types of risk The Group follows a policy of prudent liquidity risk management abertis has a “BBB+” rating, awarded including exchange rate risks, credit risks, liquidity risks, and that entails the availability of sufficient finance through by international credit rating agency interest rate risks. The management programme for the Group’s committed facilities and the ability to liquidate market Standard & Poor’s for long-term debt. overall risk considers the uncertainty of the financial markets positions. Given the dynamic nature of the Group’s businesses, This rating was given in April 2010 and attempts to minimise any potential adverse affects to the the objective of Corporate Financial Management is to maintain following a downward revision from “A-“ Group’s financial results. flexibility in financing through the availability of committed and was confirmed in August 2010. facilities. Exchange rate risk abertis also has an “A-” rating, In 2010, Abertis Infraestructuras, S.A. has renewed and taken Investment grade-high credit quality, The Group operates in the international area and has assets in out new credit facilities with a ceiling of 1,195 million euros, of awarded by international credit rating the United Kingdom, the United States, Mexico and other less which 540 million euros are in credit facilities with maturity at agency Fitch Ratings for long-term debt significant holdings in South America and South Africa, and is one year and 655 million euros in credit facilities with maturity and an “F2” rating, high credit quality, therefore exposed to risks from exchange rates due to operations at more than one year. This change in financial policy makes it for short-term debt. These ratings were with currencies, especially the US dollar, the pound sterling, the possible to strengthen the group’s liquidity position in the light given in July 2009 and confirmed in Mexican peso and the Chilean peso. of its short and medium-term needs. December 2010. The exchange rate risk on net assets in group operations in Interest rate risks currencies other than the euro is managed mainly through financial debt denominated in the corresponding foreign The objective of the management of interest rate risks is to reach currencies and through currency swap contracts. a balance in the structure of the debt which allows minimising volatility in the results account in a multi-annual horizon. Credit risks abertis uses global interest rate hedges to reduce the risk of The Group does not have significant concentrations of credit changes in financial burden. These derivatives are designed, in risks. According to its risk management policy, the group may financial terminology, as instruments of cover. undertake financial transactions with entities that have a minimum “A-” rating awarded by internationally recognised rating agencies. The rating categories of each entity are regularly reviewed in order to actively manage the counterparty risk.
70 AR CSR AA 4.3 Shareholders and the stock market stock market performance 2010 The performance of the stock markets in 2010 has once Against a backdrop of an economic recovery that is taking place again been marked by an increase in volatility brought about at different rates in different places and a crisis of confidence by ongoing uncertainty about economic recovery, mainly in in sovereign debt, the major stock market indexes have had a developed countries and especially in the euro area. The process mixed year. While some closed in the red, including the main of recovery of financial stability, which appeared more or less indexes in Spain (Ibex 35: -17.4%), Italy (FTSE MIB: -13.2%) and on track in 2009, has suffered major setbacks as a result of Portugal (PSI 20: -6.2%), others such as those in Germany (DAX tensions in the bond markets. The lack of market confidence in 20: +16.1%) and the United Kingdom (FTSE 100: +9.0%) closed the sovereign debt of countries with weaker growth and higher up for the second year in a row. deficits has counteracted the monetary authorities’ measures aimed at driving economic recovery. The Spanish Ibex 35 ended 2010 down by 17.4% over the course of the year. Market pressure on Spanish sovereign debt, which The collapse of the price of Greek sovereign debt during the peaked in May to June and in November, led to a fall in prices first half of the year and of its Irish counterpart later on led to to the lowest levels in the year. High market volatility has also a coordinated rescue package to ensure these countries could been reflected in the enormous swings in the Spanish stock access finance. In spite of these measures, there has been a index which has moved in a wide band over the course of 2010, noticeable loss of confidence in the sovereign debt of the ranging from a maximum for the year on 6 January of 12,222.5 peripheral countries in the euro area (Portugal, Spain and Italy), points to a minimum on 8 June of 8,669.8 points. driving up the yield on their securities and setting record rate differences with German bonds which are the benchmark in the eurozone.
71 AR CSR AA abertis on the securities market: share performance In 2010 abertis shares have been affected by developments in the Spanish stock market. Country risk has proved more significant than Nonetheless, its stock did climb strongly in the first few days of its financial strength and the geographical diversification of its businesses, factors that have led it to achieve growth in revenue of 5.2% July in the wake of market rumours about changes in its reference and in net profit of 6.1% over the course of the year. shareholders. These changes took place in late August with the agreement between ACS and Trébol Holdings, a company abertis’s stock ended 2010 down by 10.1% at a price of 13.455 euros per share. Its highest closing price in the year came on 6 January managed by CVC Capital Partners, which brought the latter (15.319 euros) and the lowest on 25 May (10.76 euros), in line with the general downward trend in the market over most of the year. in as an abertis shareholder through Trébol International and Admirabilia1. After the initial boost given by expectations about these changes in abertis’s shareholding structure, the company’s stock went back to following the market trend although it did ChangE In abERtIs shaREs 2010 manage to do better than the Ibex 35 at the close of 2010. CLOsE (euros) 14/6 Heads of Agreement for 1. For further details see the section on the composition of abertis’s shareholders. 18 26/01 acquisition 100% axión sanef signs the “Paquet Vert” 17 agreement 05/07 Announ- 30/8 ACS/CVC 19/4 abertis rated 16 cement Criteria/ agreement realized “BBB+” by S&P ACS holding talks 21/10 Payment for CVC to enter 05/05 interim dividend 15 abertis 2010 Payment additional 14 dividend 2009 13 27/4 Ordi- nary GSM 12 25/2 Results 11/8 Announcement 11/11 3Q 2010 2009 of ACS/CVC agree- results 11 ment for concerted note on price adjustments due to bonus share issue: action in a 25.83% 30/4 24/5 Start of stake in abertis The allocation of new shares does not affect the equity of the company, 10 Investor’s bonus issue even though it is divided into a larger number of shares. Day 29/7 All shareholders who invested before the issue receive shares without any 24/6 Admis- Results first half additional outlay. The investment in their portfolios therefore does not 9 25/03 CAM sells 13/5 sion bonus 2010 1.63% stake in 1Q 2010 shares change even though they own a larger number of shares. Consequently, abertis 8 results historic prices prior to the issue have to be adjusted in order to compare January February March April May June July August September October November December pre-issue and post-issue prices. Adjusted price Unadjusted price
72 AR CSR AA stOCK MaRKEt appRECIatIOn (%) In spite of the change in its price in the course of 2010, over the last ten years abertis shares have risen by 135% without 2010 -10.1 taking into account dividends, which shows that this year’s fall has been absorbed and surmounted by the good performance in 2009 31.0 previous years. -40.0 2008 abertis closed 2010 with a capitalization of 9,944 million 2007 2.9 euros, occupying ninth position by weight on the Ibex 35 and in thirteenth position in the market capitalization ranking. 2006 11.1 All company shares are admitted to official valorisation in the 2005 37.8 Barcelona, Bilbao, Madrid and Valencia stock exchanges, and are negotiated through the Spanish stock interconnection system. 2004 41.9 abertis shares have been part of the Ibex 35 index since 1992 and are also on other major international indexes such as 2003 16.6 Standard & Poor’s Europe 350, the FTSE Eurofirst 300 and on 2002 1.3 the Dow Jones Sustainability world and European indexes (DJSI World and DJSI Stoxx). 2001 26.2 Capitalization 2010 Accumulated variation 9,944 +135% million euros CAGR over last ten years (*): +8.9% (*) CAGR: compound annual growth rate.
73 AR CSR AA shareholder return Dividend abertis’s goal is to offer its shareholders the best combination In the month of May, abertis paid out an additional dividend of 0.30 euros per share from the year 2009, and in October 2010, the of growth and return. The company’s business actions and company paid an interim dividend of 0.30 euros gross per share for 2010. strategic decisions are geared towards generating value for its shareholders. At the 2011 Ordinary General Shareholders’ Meeting, the Board of Directors of abertis have agreed to propose, in addition to a 1x20 bonus share issue, an additional dividend for 2010 of 0.30 euros gross per share. 2010 has been the third consecutive year of crisis, yet nonetheless the Group’s sector and geographical diversification This amount, added to the interim dividend paid in October, amounts to direct shareholder return in the form of regular dividends of strategy combined with a strict policy of cost containment has 0.60 euros gross, paid from 2010 profits, which is a maximum amount to be paid as dividends of 443.4 million euros, 5% more than the managed to absorb the impact of the economic cycle. This is the sum paid for 2009 as a result of the bonus share issue. reason why, in spite of falling business activity and traffic that remains negative (mainly in Spain), abertis continues to be a great cash generator and this enables us to continue with our shareholder remuneration policy. DIvIDEnDs paID (millIons OF euros) Only includes payment of regular dividends. +11% +10% +5% +18% +12% +5% +5% 237.4 264.2 289.5 304.0 357.5 402.2 422.3 443.4 500 400 300 At the 2011 Ordinary General Shareholders’ Meeting, the Board of 200 Directors of abertis have agreed to propose, in addition to a 1x20 bonus share issue, an additional dividend for 2010 of 0.30 euros 100 gross per share. 0 2003 2004 2005 2006 2007 2008 2009 2010 Interim dividend Additional dividend
74 AR CSR AA Capital increase new milestone: abertis’s reorganization At the General Shareholders’ Meeting held on 27 April it was In February 2011, the company announced the start of a study into the reorganization of the structure of the Group designed to decided to carry out a new bonus issue at a ratio of 1 new share create the framework and conditions required to enable abertis’s five business units to embark upon a new growth stage. The Group for every 20 held. Between 24 May and 7 June the entitlements is to rearrange its 5 business units around two companies: the current Abertis Infraestructuras (toll roads, telecommunications and were traded at a high of 0.595 euros and a low of 0.525 euros. airports) and the unlisted company Saba Infraestructuras (car parks and logistics parks). The process will be implemented based on The fair value of the entitlement was 0.56 euros. the distribution of an extraordinary dividend by abertis that can be paid in cash or in shares in the new saba Infraestructuras at the shareholder’s decision. The transaction is subject to the execution of all the customary processes in these types of transactions and The new shares were initially listed on the market on 24 June and to administrative authorizations and approval by the governing bodies of abertis. abertis’s Board of Directors has also announced its have the same political and economic rights as existing shares of intention to set up an ad hoc committee (Independent Commission) composed entirely of independent advisers to work with the Audit the same class, granting their holders the right to a dividend on and Control Committee in the exercise of functions designed to ensure proper valuation of the terms of the transaction and hence to profits obtained as of 01 January 2010. review any valuations made. This valuation would also have a fairness opinion given by independent experts. The process will be implemented Extraordinary dividend or based on the distribution of an saba Infraestructuras stock extraordinary dividend by abertis that can be paid in cash or in shares in the new Saba Infraestructuras at saba InFRaEstRuCtuRas IbEX 35 unlisted the shareholder’s decision. Criteria CvC Capital aCs Other Existing new Caixa Corp partners shareholders shareholders shareholders (voluntary option)
75 AR CSR AA Return over the decade The graph below shows the stock profitability year of year of exit (1) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 of the abertis share over the last decade in entry (1) different theoretical times of the purchase ABE 31.2% 38.1% 64.8% 132.9% 21.6% 259.0% 276.1% 151.9% 223.7% 207.4% 2000 and sale of the share. The profitability of the Ibex-35 with div. -6.1% -31.0% -8.7% 10.5% 34.8% 83.4% 103.1% 28.9% 78.3% 55.2% abertis share is compared with the Ibex 35 ABE 5.5% 26.6% 80.6% 149.3% 180.5% 194.1% 95.7% 152.5% 139.6% with dividends. The intersection indicates 2001 Ibex-35 with div. -26.5% -2.8% 17.6% 43.5% 95.2% 116.1% 37.2% 89.8% 65.2% the profitability obtained by abertis and ABE 20.9% 74.2% 141.9% 172.8% 186.1% 89.0% 145.1% 132.4% the market, respectively, for the selected 2002 Ibex-35 with div. 32.2% 60.1% 95.3% 165.6% 194.1% 86.7% 158.2% 124.8% period (year of entry and exit). The Ibex 35 ABE 45.7% 103.8% 130.3% 141.8% 58.5% 106.6% 95.7% with dividends, which consists of the same 2003 Ibex-35 with div. 21.1% 47.7% 101.0% 122.5% 41.3% 95.3% 70.1% securities that make up the Ibex 35, is an ABE 41.0% 59.6% 67.7% 9.0% 42.9% 35.2% indicator that includes the change in stock 2004 Ibex-35 with div. 22.0% 66.0% 83.7% 16.7% 61.3% 40.5% prices and the return from the distribution of ABE 13.5% 19.4% -23.2% 1.4% -4.2% dividends and other payments to shareholders. 2005 This way the index shows the impact of this Ibex-35 with div. 36.0% 50.6% -4.4% 32.2% 15.1% type of remuneration on an Ibex 35 replica ABE 5.3% -33.1% -10.9% -15.9% 2006 portfolio. Ibex-35 with div. 10.7% -29.7% -2.8% -15.4% ABE -37.3% -15.7% -20.6% 2007 For example, an investor who invested 9.31 Ibex-35 with div. -36.5% -12.2% -23.5% euros purchasing an abertis share at the end ABE 35.9% 27.7% 2008 of 2000 (an investor who used the successive Ibex-35 with div. 38.3% 20.4% bonus share issues and taking into account ABE -6.2% 2009 the dividends paid), on 31 December 2010 Ibex-35 with div. -12.9% would have a portfolio to the value of 21.92 Notes: euros and would have been paid 6.70 euros (1) Entry and exit on the last day of the indicated year. Market appreciation is considered as are bonus share issues, and dividend yield. The possibility that the shareholder may have made additional outlays is not in dividends, which means an accumulated accounted for. return of 207.4%.
76 AR CSR AA share capital and treasury share portfolio As detailed in the Corporate Governance Report 2010, which Until that time, ACS had had a direct and indirect total stake of abertis’s share capital stood at 2,217 million euros at 31 forms part of this Annual Report, significant shareholdings (*) 25.83% in abertis. December, made up of 739,037,783 ordinary book entry shares at the end of the financial year are: Caja de Ahorros y Pensiones with a nominal value of 3 euros each, fully subscribed and paid de Barcelona (“la Caixa”) (28.98%) and Trébol Holding / ACS Following the agreement, ACS and Trébol have an indirect holding up and all of the same class. All the shares are listed on the four (25.83%). through two investees, Trébol International BV and Admirabilia Spanish stock markets. SL, which respectively hold 15.55% and 10.28% of abertis. The ownership percentages of abertis shareholders have In 2010, share capital increased by 35,192,275 shares, amounting changed compared to the end of 2009. Trebol holds 60% of the voting rights in both companies, while to an increase of 105.6 million euros, corresponding to the bonus ACS holds the remaining 40%. Trebol, advised by CVC Capital share issue. In August 2010 an agreement was announced between ACS, Partners, belongs to a number of investment funds or collective Actividades de Construcción y Servicios SA (ACS) and the investment institutions (Limited Partnerships). With respect to treasury stock, at the end of 2010 abertis company managed by CVC, Trébol Holdings S.á.r.l. (Trébol), for a was the direct holder of 14,551,098 shares which accounts for joint stake in two companies that would acquire abertis shares. 1.969% of share capital, compared to the 13,971,451 shares it (*) Significant shareholdings for the purposes of Royal Decree 1362/2007 dated 19 October. held in 2009 (1.985% of share capital at the end of that year). DIstRIbutIOn OF CapItaL OWnERshIp at 31/12/2010 abertis shareholder structure “la Caixa” (1) 28.98% The company does not have a nominal register of its shareholders and hence can only find out about the composition (1) Has holdings indirectly through its subsidiary company Criteria CaixaCorp S.A., coming to of its shareholder structure from information about significant Free float 20.22% and through other companies in its holdings which is published pursuant to regulations (which 43.22% group coming to 8.26%. (2) Concerted action by Trébol Holdings / ACS makes reporting holdings of more than 3% of share capital through the companies Trébol International BV and Admirabilia, S.L., which respectively have mandatory), from information provided by Iberclear solely for 15.55% and 10.28% stakes in abertis. the General Shareholders’ Meeting and from communications Concerted action made by the shareholders on the occasion of the publication of 25.83% by Trébol Holding / the Annual Report. ACS (2) Treasury stock 1.97%
77 AR CSR AA abertis and its shareholders and investors Investor Relations Directorate The Investor Relations Directorate provides full information in a clear and timely manner concerning the company’s In 2009 a complete programme of activities involving institutional 171 meetings have been held over the course of 2010 with 262 progress together with explanations of abertis’s main investors and financial analysts has been maintained involving investment institutions (managers) in 22 cities, some of which business, organizational and operational strategies. These are meetings in the leading financial markets in Europe, the United have been visited on more than one occasion. key elements that make it possible to set the appropriate States and Asia. This is necessary due to the Group’s worldwide price of shares and other financial assets issued by abertis. and diverse shareholder structure. Another of the objectives of this directorate is to deliver the accessibility and direct contact with the company that makes it possible to give an effective response to the issues raised by the investment community. London To achieve these objectives and tailor information to Edinburgh the needs of all groups, Investor Relations maps out and Dublin Munich implements a communication strategy for domestic and Brussels international financial markets. This involves a policy of active The Hague Lisbon Milan Denver Minneapolis and wide-ranging communication that includes meetings Paris San Francisco Boston 22 with institutional investors and financial analysts, conference Los Ángeles New York calls, meetings with shareholders, the shareholders’ magazine, Toronto Chicago a call centre and a constantly updated website. cities visited The functions of the directorate also include keeping the Singapore company’s senior management informed concerning market opinion about the organisation or any other questions which 262 may affect the share price. managers 21 road shows (usa, Europe, australia)
78 AR CSR AA Investor’s Day shareholders’ Office The second annual abertis Investor’s Day was held in April Relations with the company’s approximately 80,000 non- At the Ordinary General Shareholders’ Meeting 2010, which was 2010, an event with analysts and institutional investors that institutional shareholders are handled by the Shareholders’ held on 27 April, the Shareholders’ Office also provided backup seeks to contribute to improving knowledge of the company, its Office, which is also in charge of drawing up and implementing for event organisation and meeting requests for information. business units, financial structure, strategy and so on. It features information programmes in cities around Spain and providing Shareholders’ right to information is included in article 7 of the presentations by the top management of the company with personalised service through all communication channels with Regulations for General Shareholders’ Meetings, and in articles analysts and investors, facilitating two-way contact between non-institution shareholders. 144 and 212 of the Spanish Public Limited Companies Act. Thus the professions and the head of the company. The event was shareholders are provided with all the information they require attended by 88 people and its presentations and audio were These channels consist of the Shareholders’ Service phone line, before each General Meeting is held and the Shareholders’ Office also made available to the general public on abertis’s corporate which operates 24/7/365, and the corporate website featuring a clears up any doubts or queries they may have. website. specific sector for the investor community featuring constantly updated information about issues such as the company’s The most recent Ordinary General Shareholders’ Meeting was performance, growth, stock market price and remuneration held with the attendance of a total of 5,342 shareholders with policy. There is also e-mail, an increasingly popular option due to voting rights (67.81% of share capital), of which 633 attended its immediacy, and post. in person (5.23% of share capital) and 4,709 by proxy (62.58% of share capital). The foregoing is enhanced by regular meetings under the PRÓXIMO Programme. This is a pioneering initiative among non- banking companies which was launched in 2005 and consists of holding meetings all around Spain to provide shareholders and investors in general with information about the Group, describe its prospects and respond to queries and suggestions.
published by: Corporate Studies and Communication Dept., abertisDesign: gosban consultora de comunicación