Eiffage SA (FGR) Earnings Call Transcript & Summary

[Interpreted] Good evening, all of you. I'm glad to see you for the presentation of our annual results of 2021. Glad that a certain amount of you can be present, physically, this evening, it's not often. Thanks for being here. Thanks for those following us remotely. I do hope that next time, we will all be together in presence and extend this presentation with the cocktail party. I commend also the members of the management and of the Board who are with us this evening. 2021 was intense with beautiful successes. Again, it was highlighted by the pandemic, but our teams know perfectly well to live with it. This year, we strengthened our positions, strategic positions. Our balance works, Concession and our capacity to remain a local player, while being a global player, able of operating major complex projects are a source of resilience for the development of the group. Our geographic consistency centered on Europe is a strength, enabling also us to project our European expertise in all the rest of the globe. Our compact organization, it confers us agility, rapidity, enabling us to mobilize in a much more powerful way, our different businesses to capture the value, which is more and more at the interfaces at the time of the ecological and digital transition. I remain convinced that our businesses will know how to face the challenges of those transitions on the city, infrastructure and mobility. These are the levers of growth for the decades to come. With the values of the group, our teams are mobilized and excited to support our clients to raise and face the challenge of the fight against global warming. We concluded 2021 with an order book wealthy, giving us visibility. The commercial traction was very strong and enabled us to have an order intake as important as last year and works. While, as you know, in 2020, we enjoyed 3 exceptional contracts, HS2 in the U.K., A3 in Germany, A79 in France. The traction of the risk recurring businesses being able to compensate for the lack of those super contracts. This commercial traction is borne by the private and public sector, generally speaking, in Europe. For France, the public procurement is very strong for what is for the State Ministry of transport, defense, health, justice, education and new construction, but also in renovation projects. However, public procurement coming from local authorities remains lagging behind, like the issuing of building permits that will impact the housing business. Beyond the book of order, lot 1 of the tunnel Lyon-Turin and 2 major contracts on several years in France, Cegelog and the lighting of the City of Paris, on which I'll get back later. I invite you to discover certain amount of those contracts signed in 2021. [Presentation]

Group is growing its activity [ of short ] its level of 2019, which already was a level of activity, which was historical. To illustrate the highlights of works during this year, I suggest some focuses. For Eiffage Construction, the year was highlighted by the dynamic of the public markets, more and more renovation projects, ramping up of the wooden construction and low carbon, generally speaking, development of our industrial solutions. As you may notice, those 3 elements are at the heart of the acceleration of our low carbon offer, enabling us to reduce our greenhouse gases and be a partner of our clients to help them reach their own targets, against the background with issuing of construction permits is decreasing, Eiffage [ Mobilité ] would enabled -- was enabled to benefit from the starting of its activity in Poland and increasing its planning business to offset the decrease to come off its housing activity. In France, the construction of public facilities is well oriented, borne by the recovery efforts of the government, several projects of ambitious renovation or new constructions, often in a combined way are put on the market. On screen, as you see, the administrative city of Lyon, our teams are working on the first tranche of the rebuilding and the city administrative, City of Colmar and progress also. Eiffage committed itself for over 10 years in the development of wooden construction and equipment trapping carbon enabling to reduce the time of works, thanks to the preassembled elements, favoring also excellent thermal performances and energy performances. From left to right, Hypérion tower delivered in Bordeaux this year. Research and Innovation Center for Danone that you have seen at the beginning, and the high school of Clermont-Ferrand, who's particularity besides wooden frame walls using straw for thermal insulation. Eiffage construction has a solid experience in industrialization of production processes. It was a forerunner in this area with this concept of bathrooms HVA concept started 10 years ago in the South area. Integration of Savare recognized expert in the fabrication and framing and wooden framing in the walls and B3 Ecodesign specialists of the transformation of sea containers in all kinds of buildings, add to the offer of production off-site. Integration of know-how of concrete construction, steel construction and wood construction enables the group to make sure sober and lean design highlighting and putting the best equipment, the best material at the best place, coupled with industrial solutions enabling the fabrication, the manufacturing offsite, Eiffage Construction may promote with its clients a first-class support in their low-carbon strategy. The road teams roll out an ambitious plan to contribute to the ecological transition. What are the 3 pillars? Energy efficiency of our factories and our machines, recycling of materials and often always more complete decarbonated solution. The rolling out of connected things in our manufacturers of porous asphalts, binders, helped the steering and adjustment of temperatures and optimization in real time. It enables us to manage in due time, the energy conception of each task. End of 2021, 40% of our factories were connected and 100% of them will be at the end of 2022. We rolled out the same strategy for our transport machines. The recuperation and analysis of data in real time enables us to reduce at the most, the consumption, making sure that they are at the right level, given the task. This enables, for instance, to suppress the slowdown times. Beyond the reduction of consumption, we rolled out solutions of biofuel on our park, 30% of our sites are all today equipped. Beyond the energy efficiency, we increase year after year the rate of recycling of materials in our solutions. We have especially focused our research on emergence of a plant range, enabling to suggest alternatives decarbonated to vitamin and answer to all the uses from cycle path to motorway. Biophalt, which is a plant-based asphalt with high performance, highly recyclable, recycled ARM regenerations, on location solution. And finally, Bioklair with its colored coating, which is really favored for soft mobilities. Civil engineering remains supported by very large projects in France, Germany, U.K. and internationally speaking. It's an important part, very important part of its activity, ensuring it a very good visibility. The recognized expertise of the group in works of art and underground enable us to be a player of the major project infrastructure in Europe like the Grand Paris Express, the Lyon-Turin line or the HS2 in the U.K. The group strengthens itself in specialty businesses so as to master in-house even more expertise mandatory to make the difference. On screen now, you see some pictures from our very large working and building. Grand Paris Express, we have 10 tunnel borers mobilized to dig Eole Line 14 North, 14 South, Line 15 and Line 16 and 17. The group developed in businesses of specialty like demolition, deconstruction, repairing of works or sea [ trial ] works contributing to the wealth of our office and our skills. Demolition deconstruction is a perfect example of business and great mutation because it's a key player of circular economy. We reached now over 90%, 9-0 percent of recycling in our works of demolition deconstruction. Steel construction remains supported by very strong activity and wind energy and enjoy since 2021, a recovery -- strong recovery in the works of art. Our major asset is our industrial European power with 9 factories specialized according to the markets they are addressing, works of art, buildings, offshore wind energy, onshore wind energy. Activity is very intense on the offshore wind farms where we are a major player with a recognized know-how. Already present on several projects in France, in Germany, Scotland, Netherlands, England and Taiwan and even in Japan, we signed end of 2021, a new market for the third phase of the offshore wind farm of Dogger Bank in the U.K. We're also a stakeholder in the pilot project of floating wind farms in France, and the market remains buoyant with lots of manufacturing already planned in our factories up to 2025. Eiffage Metal enjoyed a strong progression of its works of our art work during 2021, activity supported by international major projects like the Leverkusen Bridge in Germany, high-speed line HS2 in the U.K. and soon 3 works of art for the motorway of E18 in Norway. The factory in [indiscernible] (00:18:35) is already full-fledged production until 2023. Eiffage energy system is at the core of all the challenges of digital and ecological transition. This department delivers to its clients, but also to the other businesses of the group, so as to enrich our offers and to enable us to make the difference. It goes on its dynamic of organic growth and of external growth while improving its level of profitability. For instance, the leadership in photovoltaic farms, the 12 acquisition realized this year in Europe and a very beautiful contract of lighting of the City of Paris. We are leader -- European leader for the installation of photovoltaic sun farms, where our French and Spanish teams are recognized for their construction of fields that we ensure the maintenance for durations of 5 to 20 years. Since 2007, over 70 sun farms have been built by Eiffage in Europe, Africa, Latin America and the Caribbeans for over 3.5 gigawatts of installed power. And for 2025, we installed 1.4 gigawatts, a nice illustration of the acceleration of this market. Beyond organic growth during 2021, over 12 companies in France and Europe joined us, representing 625 employees and revenues of over EUR 120 million for a full year. We just integrated as you see on the map, the company, Ciel, located in Switzerland, specialized in electric engineering with 230 employees and a revenue of EUR 30 million. Our team signed an agreement in October 2021. The market for public lighting, light signaling and eliminations of the City of Paris for an amount of EUR 704 million and a 50-50 groupment with Citelum for a duration of 10 years. It's the most important contract ever signed in France in this area. 240-gigawatt hour of saving of energy will be realized over 10 years. So a reduction of 30% of the current consumption of the public lighting as of the fifth year of the contract. The project will go on parallelly a target of protection of biodiversity with the creation of dark screen favoring the development of fauna and flora along less well-lit areas. Special mention for our Facades Goyer, who commemorate its 90th anniversary, 90, 9-0, with the level at its highest and the signature of a global agreement for the greatest biggest contract of its history, facades of the tower, The Link at La Défense, future headquarters of Total energy. Concessions now. 2021, enable the strengthening of our portfolio and our motorway concessions went back on the second half of the year, traffic above the ones of 2019. And went on with strategy of continuous improvement of services to the client. On the territories where the group is in a sustainable way located the portfolio of Concession is wealthier with the commissioning of the A79 slated for the fall of 2022, with transfer to APRR. The acquisition of minority shareholders of A65 and the acquisition of the operational society. Extension of 5 years of contract concession of the motorway of future in Senegal and the signing of the Ministry of Defense of the first Concession contract of housing in France over 35 years. The A79 that will be commissioned next year, is a perfect example of mobilization of the business of the group to create a new concession altogether. It's going to be the first motorway in France with a free flow e-toll for 80 kilometers. Eiffage and APRR signed this day, a session of capital contract and the current accounts of the A79 turning APRR the major shareholders under the reservation of various validation. This transaction should be finalized at the end of the first half year 2022. We bought out also the minority shareholders of A65 between Pau and Langon and acquired 100% of the company, who is in charge of the maintenance operation. In December, we signed a rider about the concession of the highway, the future of the state of Senegal, putting a legal aspect to its entrance to the capital up to the 25% of the capital. This rider includes the implementation of new investments to maintain the service level and the extension of the concession by 5 years up to 2044. In 2021, the motorway of future welcomed 150,000 vehicles per day on the average. It's also the collective work of the departments of works and concession that enabled us in association with Arcade-VYV to deliver the best answer to win the first concession of housing for the Ministry of Defense and the framework of its program, Ambition Housing. It's a concession to ensure the outsourced management of a state-owned housing stock on the whole of the French territory for 35 years, 3-5. We'll be in charge of the improvement of the energy performance of the stock with the renovation of 8,000 apartments and its development with the new construction of 3,000 housing units. The design, construction, renovation implemented by Eiffage construction will be focused on the 8 first years of the contract and will represent investments to the tune of over EUR 1.3 billion. In parallel with our partner, Arcade-VYV will ensure the care and maintenance of all of the stock as well as the modernization and the improvement of the quality of service for the soldiers and their relatives, their families. The management will start in 2023 after a transfer period with the current manager. To be noticed also in the framework of our rotation strategy of our portfolio that you know perfectly well, the portfolio of PPP. We ceded, we sold 5 contracts in teaching for an active asset value of EUR 150 million while keeping the contracts of operation and maintenance. Regarding the motorway concessions, our motorways are back to levels of dynamic traffic. Innovation is at the heart of the strategy to face the challenges of ecological transition of motorways and meet the challenges and the expectations of our end customers. After a first half year impacted by pandemic, traffic of second half is above 4.6% to the one of 2019. The very good traction witnesses the will of our clients to move again. To be noticed that the HV traffic remained resilient even during the last lockdowns, a proof of the continuity of the economic activity. The new modes of mobility, car pooling, interconnection, digitization of services, free flow e-toll, all the massive income of electric vehicles and emergence of semiautonomous vehicles modify in-depth our role of concession -- motorway concessionary and give all this meaning to the important investments that we make to meet those challenges. In 2021, we rolled out 5 new rest areas fully split over the network with a very competitive price of fuel and improved services. We have more than 6,000 parking lots for carpooling. We have 65% of the rest areas of APRR own area with electrical charging stations and 2/3 of them by the end of 2021. 100% of our stations will be equipped by the end of 2022. We are ready to be a partner of the state to ensure the investments necessary to speed up the ecological transition of the motorways, take part in the reconquest of biodiversity and welcome new mobilities and semiautonomous vehicles. As you have noticed through the highlights, the low-carbon strategy of the group is part and parcel of our operations. We have also to be an example. We decided in 2021 to set ambitious targets of reduction of our greenhouse gases to be compliant to the 1.5-degree target. This will feed our signature, "savoir faire la différence," know how to make a difference, and will be a fantastic engine for growth for the decades to come. Those elements enabled us to confirm our ratings -- extra financial ratings A- CDP, AA MSCI among the best in the business. In terms of human resources, we must be especially aware about our capacity to hire, onboard, train, make, move forward, loyalty, raise and get more females. With the acceleration of our development, we will integrate more and more female employees. The cohesion of the group and the loyalty to our values are unquestionable assets. The major challenge of development of HR goes through an ambitious politic. All levels of the company was consolidated, has to make sure that it will be followed and it will also succeed. Where we're very glad to be at the first rank of the construction business in the 500 groups, the most appreciated by their employees and by their competitors survey made by the magazine, Capital, APRR is also the first in its business transportation of goods and logistics for the eighth consecutive year. Let's get to the major figures of 2021. Better quality of what I anticipated a year ago here with you, a raise of the revenue to the tune of 14.7% up to EUR 18.7 billion above the one of 2019. While the previous was very dynamic in all the businesses. The operating profit is at EUR 1.9 billion, more than 50% compared to 2020. The operational margin of Works is above the one of 2019 and above the one of the 5 past years. The strong increase of the net profit of the group, reaching EUR 777 million above 2019. Free cash flow is at EUR 1.6 billion, significant raise compared to 2020, but also compared to 2019. This enabled us to finance acquisitions I talked about earlier by reducing our financial net debt to the tune of EUR 500 million to be now at EUR 9.3 billion by the end of the year. The strong activity of this year did not impact our order book far from that, since it concludes with a small increase at EUR 16.3 billion, once again at its highest historical level. For 2022, we anticipate a new progression of our results in works as well as in concessions. Works should enjoy a slight increase of its revenue. And in Concession, growth should be more sustained, thanks to the traction of the traffic. Strong with this very beautiful year, we shall suggest to the general assembly of April 20, 2022, a dividend at EUR 3.10 per action. Our significant -- our financial means are significant. I am confident in our capacity to go on with the development of the group and organic growth as well as an external growth. Thank you for your attention. I invite Christian to give you in-detailed explanation about the financial elements. Thank you.

[Interpreted] Good evening, everyone. So let's take a look at the main financial indicators. Revenue, no surprises there, significantly up 14.7% compared to 2020. So you can see on the left-hand side, there's a bounce back in both the concession and contracting. And then internationally, even more, 16.1% compared to 13.9% in France and 96% of our revenue is generated in Europe with a few key countries that you already know, in line, with our strategy. So compared to 2019, which is, this was a benchmark, revenue was up 3.2%, 3.4% in contracting, while 2019 was already high base of comparison because it had enjoyed 10% year-on-year -- 10% growth year-on-year. In Concession, growth is only 2.2%. That's because there were travel restrictions all the way out to May. And you should also remember that in 2019, there was no airport. So if you don't -- if you leave that out, in fact, Concession would have been down 1.4% compared to the one of 2019. If you look at contraction -- contracting, I beg your pardon. You can see that growth is more significant overseas compared to Europe. In Europe, we're way above our 2019 level of EUR 350 million, especially in Spain, with energy. And Germany, in all 3 -- in all our businesses, where we have a 30% -- 33% increase in revenue in that country. You had the detailed breakdown of revenue country by country in the appendix and 32% of our contracting business is done outside France. Operating profit then on ordinary activities and that's enabled us to renew with the profit margins of 2019 in two of our branches and do better in energy systems for a total 3.7%, so that's EUR 36 million additional operating profit. Profits and margins are still down in concessions for two reasons: the integration of the airports only in 2020. And of course, at the beginning of the year, there was not much traffic. In April, motorway traffic was at 50% of nominal level and air traffic down to 15%. Of course, things have improved a bit. But anyway, all in all, operating profit from ordinary activity is down 4.3% compared to 2019 or EUR 86 million, including EUR 127 million in Concessions. In Construction, there is less revenue that's because there was less volume mostly in Poland and Switzerland, where we had more business that we hit a low ebb in these 2 countries. And now we are back to business in '20 with an order book building up in 2021 in France. I've been wanting to give you the details of construction and property development. Our reservations in property development is slightly down compared to 2020, down 18% compared to 2019, but a good number in Poland, where we sold more than 500 housing units, and that's part of the order book building, I was telling you about. Operating profit and property development stands at 6.4%, compared with 7.8% in 2019. And so we had EUR 71 million in operating profit. But in spite of this lower contribution of property development, that branch has renewed with profits at 3.7% in line with 2019, which means that the business is building up. This is work in 83 Avenue Marceau, 30 months project, this is building with 6 levels, 10,000 square meters, very technical work. We turned 3 underground levels into reception areas and shared spaces and facades have been built by our subsidiary, Goyer. In Infrastructure, revenue way above 2019, which was already high, thanks to international 15.5% -- plus 15.5% mostly because of the boom in infrastructure -- transportation infrastructure in Germany, which I mentioned. Also the ramping up of the high speed line in the U.K. and a good business in the offshore wind mills. In France, that branch had ups and downs. Road is down compared to 2019. Well, that's an electoral year. It's always like this. Civil Engineering has gained leverage from the Grand Paris Express with a peak in 2021 before the climb down. Grand Paris Express, we're looking at EUR 737 million for Eiffage, including EUR 716 million for the infrastructure brand. And Metal in France is driven by the windmill project, but also bridges and tunnels and metal structures in the construction industry. So operating profit -- operating margin, sorry, stood at 2.9% just as in 2019. These pictures, the Eiffage Metal teams are very proud that we're able to build, design and actually raise that 7 point that started -- 75 -- 7.5 meters in diameter, 12 branches at the top of the ninth tower of Sagrada Família in Barcelona, 138 meters high that was with the Energy Systems branch. So these are not one of the big civil engineer project, but still, it shows the know-how of this branch. Energy Systems then, significant growth driven by dynamic businesses and the positioning on Eiffage on renewable energies in France. And overseas, a few good examples on the screen. Our subsidiaries in Europe are driving the business even though it's mostly sustained in France, plus 20% in Spain compared to 2019, plus 16% in Germany. Operating margin stands at 5%. So that's the target we indicated a few years ago. And indeed, many of our subsidiaries are doing better than that, and we generated EUR 32 million additional profits compared with 2019. On the screen, you have the Fréjus tunnel, where our teams are renovating the existing tunnel, the ventilation of the existing tunnel but also providing lightning, signposting, light signals and cooling of the workstations in the second tunnel. So that goes to show we have a significant expertise in tunnel building and an equipment. Regarding APRR, lower traffic, and therefore, lower revenue compared to 2019 is attributable to H1, 1.6% over the year were divided into minus 10.9% in H1 and plus 7.1% in H2. Of course, that has an effect on the EBITDA margin slightly below 2019, but that was also because of the consolidation of fully a subsidiary that provides services on the rest and service areas, positive but low profit margin. So on the like for like basis, the EBITDA margin would have been identical to that of 2019 in spite of lower traffic. Regarding credit rating. Our rating stood at A-, and we actually issued a bond, zero-coupon bond due in 2028. That was the first time we did this. Regarding the ongoing capital expenditure, we have these broad bridges for wildlife and this is what happens at night. You see this deer crossing that bridge. Regarding our own and other assets in Concessions, we should indicate a good traffic on the Millau bridge higher than 2019. Renewed traffic on the Autoroute de l’Avenir motorway in Senegal. The air traffic is resuming from the summer, 2/3 of the benchmark 2019. The operating loss EUR 33 million is mostly due to the depreciation of the acquisition of the Toulouse Airport. But without that, operating profit would have been nil and EBITDA would have been positive. And then I have to mention the good performance of our maintenance subsidiaries and our PPP in the building industry as well as our dedicated maintenance companies on the Autoroute de l'Avenir African Motorway and the BPL highway line -- high-speed line, I beg your pardon. This is PPP on the Perry Island in Paris, which will bring together police stations of the first 4 districts of Paris, Benoit mentioned. So 6,000 square meters. And Benoit Ruffray mentioned this, the highlights of this. And here, the way it looks now, it will be finished completed in H1 of this year. So this enabled me to address the 2 main items on the income statement: revenue and operating profit. Other expenses and income, same order as in 2020, lower than 2019. So we have a net charge. The cost, the net financial debt is down EUR 7 million, even though we had to pay out a full year of interest on the Eiffage bond of June 2020. Other financial income and expenses include, apart from present value calculations, you have the dividends we received from nonconsolidated stakes to the tune of EUR 8 million compared to EUR 1 million in 2020. Taxes include as in H1, a return to better fortunes on a dispute with APRR, not including this nonrecurrent item, the effective corporate income tax stands at 28.4%. And so net profit attributable to the group stands at EUR 777 million, earnings per share EUR 7.98. Now looking at the net debt, EBITDA is above that of 2020. Indeed, above that of 2019, you have it as a footnote on this slide. The change in working capital requirements generated cash to the tune of EUR 234 million after EUR 321 million in 2020. So if you add up both years, that's a significant amount. Interest and taxes are down significantly over the past 2 years. And so you had our operating cash flow plus EUR 2.7 billion, so significantly, I mean, EUR 500 million up compared to 2019. A lot of it being recurrent. Capital expenditure in construction -- in contracting, sorry, EUR 510 million, stable, round about EUR 500 million year-on-year. Concessions, that includes EUR 400 million for APRR, EUR 330 million for the building of the new A79 motorway and the balance on the other PPP concessions, including 3 being built, including the Perry Island I mentioned earlier on. Then you have the payment of PPP receivables, the disposal of a commercial building as part of our partnership with the Pierre Mauroy Stadium. And so total capital expenditure, net CapEx is EUR 1.2 billion higher than in 2019 and 2020, but that's mostly because of -- we're building that motorway A79. So this is a growth type of CapEx rather than renewal CapEx. Any case, free cash flow stands at EUR 1.55 billion. So as you can see, this is much way above the level of the past 2 years, even though there was this significant capital expenditure on that motorway. Regarding acquisitions, EUR 233 million, including the minority interest in A65 and 100% of that operating company. And the balance covers the 12 companies that we acquired in the Energy business, minus the proceeds from disposals. And then capital operations dividend paid out by Eiffage, EUR 300 million, dividends paid by APRR to its minority shareholders. And indeed, a capital increase for employees only. And that we have our treasury shares representing 2.4% of the equity compared with 1.2% at the end of 2020. And so the net debt at end 2021 stands at EUR 9.3 billion, down EUR 556 million. You can see on this slide. And we'd like to give the details between Concession without recourse and the net cash in the holding company and Contracting. So within that, you have the debt of PPPs that were disposed of EUR 140 million and the balance being the normal debt of our Concessions. And upwards, you have the cash available, about EUR 1 billion, stable over 1 year. Stable, but that's paid for our external growth of EUR 285 million. The building of the A79, the EUR 300 million. And then for the past 2 years, of course, the cash position in Contracting was very good, but that was also thanks to the lower WCR I mentioned earlier. So that's the financial details. A few words on the order book. The backlog, Benoit mentioned earlier, but you have the details here branch by branch. In the Construction business, this growing order book is a reflection of the buoyant market in public buildings and the energy renovation of existing buildings, lower infrastructure because, well, you have fewer big projects, EUR 700 million and EUR 250 million on HS2. And then in energy, the 11% increase is pretty homogeneous. You have the energy transition projects mostly. On the left-hand side, you can see that in a number of months, the order book is up compared to the last 2 years. So that was a quick overview in figures. And now we're ready to take your questions.

[Interpreted] We need the microphones, we'll be ready in a second.

Two topics: Number one, could we take a closer look at APRR and the A79, which was nicknamed the Highway of Death in the past. And then on Eiffage Construction, on APRR and the A79, could we have an order of magnitude of the capital expenditure in 2022 and 2023? What are you expecting for the next 2 years? And could we also have an order of magnitude for the revenue of A79, the concession for A79 once that is in service? I mean, you didn't give us any guidance last year, but maybe now you can tell us more. Regarding Eiffage Construction, well, there's excellent profit margin on the contracting part, even if some of the big projects are down. And of course, you have the cost of factors that are going up. Now given all this, what can you expect for 2022? I mean, there is, of course, pressure on the cost of raw materials and on the supply chain plus, of course, you can expect that the wage bill is likely to go up for construction workers.

Right. On the A79, no changes compared to last year. We're not in a position to give you much guidance.

Well, we -- the capital expenditure was EUR 150 million to EUR 200 million in 2022, nothing planned for 2023. So we're looking at about EUR 200 million in that branch in terms of capital expenditure.

Maybe additional details on capital expenditure.

On the existing -- on APRR, Christian just said this EUR 400 million was spent in 2021. We're looking now at a similar amount for 2022, EUR 400 million. And in 2023, there will be a significant drop because the main two projects still underway that is the 841 -- 418 [indiscernible] and the motorway network in [indiscernible] will be either completed or well underway. And so we'll be down to EUR 250 million in capital expenditure, compared to EUR 400 million for 2022 and 2023.

[Interpreted] Olivier. Regarding the profitability on the contracting business, well, the good thing is this volume, there's business. As I said earlier on, we did -- we worked hard on productivity. We are always careful on our structural costs. A few months ago, I said that the profit margin should rise provided that the cost of materials doesn't weigh us down any more than the -- than it has in the past few months.

[Interpreted] What I can add compared to what Olivier just said is that, of course, this is an inflationary environment, and we have to take that on board, especially when it comes to our employees, but there's a high growth in demand in terms of volume. And so we have reason to believe that we can pass on the additional cost to our end customers because, as I said, demand was quite high, especially regarding public buildings. Regarding now -- well, these public orders, there's [ Napoleon ] decrease. Some of the prices can be passed on for the private sector, it's not quite the same. There's -- well, the clauses in the contracts do not provide for a revision of the rates due to inflation. Well, we don't have this, but -- the thing is 6 months ago, the rise in the cost of raw materials was unexpected. Now we do expect it and factor it in. What I wanted to say is that fundamentally, when you have a high demand, as is the case now, you have projects, you have operations that we simply cannot take up because we simply haven't got the people. So there is much less pressure from the competition. We have more than we can handle, especially in the construction industry. And that has enabled us to make provisions for inflation more significantly, of course, than when we did have as much business.

[Interpreted] Sorry, I took the microphone [indiscernible]. I had a question on the decarbonization of the motorways. You said you were prepared to work with the French government on that. Could you tell us where you stand? Where last year, we talked about anywhere between EUR 60 billion and EUR 70 billion in capital expenditure for the decarbonization of the motorways, is that the order of magnitude you have in mind? Is it still on the table? Regarding capital -- working capital requirements is a good surprise. Where -- how can you explain the good surprise? What -- are there any items that can be improved? But I mean that good momentum that was sort of unexpected, but can you turn this into a recurring trend? And on external growth, that is acquisitions, do you believe that you will be in a position to allocate the capital -- your profit to new acquisitions? What are your priorities in this respect?

[Interpreted] Well, regarding question number one, I'll let Philippe answer this. From a generic viewpoint, there is quite a bit of work on the biodiversity to speed up the environmental, the ecological transition. Of course, in motorways, we are -- well, we are there all over the country. And we can see that, for instance, in electric cars, if you want to be -- if you want to travel without worries, you better -- if you've got an electric car, you better use a motorway rather than roads without charging stations. And we are not going further than what we've said, but talks are still ongoing. Maybe Philippe can tell you more about this.

[Interpreted] Thank you. Yes, well, during our last session in August, I mentioned the talks we are having with the Ministry of Transport to define a CapEx -- an investment project, limited in scope, but we have finalized it. And with the Ministry of Transport, we have arrived at a plan that includes about EUR 400 million in investment in the energy transition and fundamental transition in low carbon. So that's the capital expenditure on the table. We -- this is being examined by the authorities now to see the ART we're waiting for a go ahead in H2. So that's where we stand now. This is, as I said, limited in scope, we could consider a step to a bigger, more ambitions. But I mean this is as it were an example of what could be done on a broader scale on all of our motorways.

[Interpreted] Christian, on WCR.

[Interpreted] Well, it's a bit difficult to -- I mean, any forecast on the WCR is always tricky, but I mean some general context, there are 2 main items. First is loss of cash because an intercompany in credit works well. There's no - our customers pay us well and on time. Then there is the French situation. The new provisions, that is the new regulations are an incentive for our customers to pay us quickly, but for us to pay our suppliers promptly as well. So that means that the -- well, that's good for the cash position overall. If you look at the macroeconomics, the order book for Eiffage has built up. You have to note that the -- in the construction industry, this has usually a negative WCR, so therefore, positive cash. And so that -- for these 2 reasons, we have high cash levels, plus offshore has generated lots of cash and you know we have big projects, again, big contracts, with milestones that happen to be on the right side of the timetable. So right now, we have high levels of cash. WCR right now remains stable. So we hope not to have suddenly a big cash out after 2 years of cash generation. Having said that, saying that what the future will bring, we do not know. But right now, there's a favorable economic context.

[Interpreted] Thank you, Christian. Regarding the third question, the external growth. Basic elements and the strategy remain the same. We have this balance between works and concession and long run, we're interested to maintain this balance. So hence, the work being performed above the capacity of strengthening our portfolio of concessions. The best are the ones we have in organic growth. Well, we mobilize all the departments of construction to generate it but remain very cautious about a certain amount of opportunities. However, we remain consistent. Our development in concession, we focused in countries where we are present, is the countries of Europe and some African countries because it seems to be the best way to contain the political risk when you are a recognized employer with the society responsibility on the territory you're working on. Then about external growth regarding works. We have elements, if you take the various geographies -- on the French side, if you take the construction or engineering, steel construction, there are no things, the contracts, whatever the complexity that we cannot ensure we can be -- lead to be strengthening on the line of specialty, but it's not the external growth that is the most important. However, on the energy system, there are many consolidations that are possible and with the emergence of the development of the topics linked to the digital transition, ecological transition, we have "new businesses, new jobs". We remain installator. So we have to acquire the best solution to have the most differentiating offer for the clients. When you move to the other countries in Europe, we are more open. Even if we have positions which are rather strong, there are a few countries where we have a total geographic cover, including in the infrastructure branch or the construction branch. So we remain opportunistic to improve our coverage in our specialties with a focus rather strong on the energy system branch because it is in the global phase of consolidation and that we are -- we want to be a player in this consolidation focusing on the geography -- European geography, as you have understood. So there are opportunities. I think that the topics, the work we all did collectively is something bearing fruit and the fact that it's included and understood by all of the teams and it increased our visibility on the traction we had to do bottom maybe in a more important way and size and more global on the various territories where we're already present, globally, the guidelines, the major lines.

[Interpreted] Nabil Ahmed, Barclays. So I have 3 questions, if you allow me. I'll talk about things we didn't talk about yet. Can you remind us the impact of the decrease of expenses on Grand Paris, the peak was last year. How much will that be in 2022, 2023 in activity? You said in the past, you were conservative on the recognition of the results of those contracts. 2022, will this be the year where we'll have an improvement of the profitability of the branch linked to the profits? Second question was about Energy Systems. So I think you know what I'm going to ask you. You said that you could go towards the 5%. You're there. You said that there was a structural difference given your size compared to the best in class, the best-in-class go on improving. Internally, what's realistic? What can you do? You said some of the subsidiaries had a higher profitability. What's realistic for the branch? And last question, can you give us some indication about the beginning of the year traffic on APRR? One of your competitors published a softer traffic compared to what we've seen in January last year. And you're more exposed to the winter vacations.

[Interpreted] Let's start with the last one, right, Philippe.

[Interpreted] Last year, on the 2 networks, we suffered a lot due to the closure of the ski stations. Reservations are at a very high level in the Alpes. Yes, Traffic is well oriented in this beginning of the year. It is above the one of 2019. And I think it is in the right line of the positive trends that we noticed that the second quarter 2021.

[Interpreted] Thank you, Philippe. Guillaume, some elements on the Greater Paris, on the Grand Paris.

[Interpreted] As you said, the peak of activity on Grand Paris was in 2021, 2020. We remain constant in 2021, EUR 715 million, EUR 700 million for the previous years. We started a decrease -- in 2022, the figures will decrease to the tune of EUR 150 million, and this decrease will go on in 2023 and 2024. Next, for the Grand Paris. During the previous meeting, I said in 2019, 2020, we are competing on the next tenders. We hope to be present. We try to offset that by activities in the region, is very dynamic with other customers. Benoit quoted projects with the Defense Ministry activity that is ramping up. On the more specific margins of the Grand Paris, we have a recognition of the margins, which is cautious, slightly positive. We are currently -- which is a classic way of -- about tunnels. And we have discussions with the customer. Some are about to be finalized and we hope all the questions that we have to settle in 2022 and enabling us to have a final vision on the outcome. What I would add to what Guillaume said Nabil is the Société du Grand Pari having decided to stop its initial plan of just design -- to move to design and building, we have more activity, more cover of overheads. But what is crystal clear is that it has an impact on the profitability of the branch. Even if we allow me, it's good cholesterol because we hope to go on with our position as a partner of the Grand Paris Express on the major lines. On the Energy System branch, yes, the aim is indeed was to reach 5%. No reason in those businesses, I always said we must have a cover how the territory be present with the clients, often with teams, with less specialty and sell added value delivering the know-how of the branch to the customer. And hence, more powerful you are, more of the coverage of this presence on a daily base to deliver solution with a strong added value is amortized and the underlying is positive. This gap of volume is there, and it will remain. Then no reason and maybe it's on purpose that Christian says that it never has to say it's possible to progress. But basically, for me, what's the most important is to make sustainable this performance. And it's true that we're working on that because we make it sustainable by continuing our strategic plan. We have teams working more and more collectively that are the ambassadors of the right solutions with the customers. And this is a long-term construction. If the volume improves, the underlying will come and support the improvement of the profitability of the margin. And the first target is to make sustainable and to remain being attractive to invest in organic and external growth. When you invest in organic growth, you invest and you penalize the immediate margin, but that's how you develop the hydroelectricity, and we're doing nothing on that, and we're very active on that. And there's a real creation of volume and value on the long run. The teams are very glad to have reached the target we collectively set 5 years ago and they like it. So we go on working.

[Interpreted] Any other question?

[Interpreted] Yes, a subsidiary question about Energy Systems. The German revenue was EUR 130 million on this branch. What is it now?

[Interpreted] Now it's close to -- much closer to EUR 200 million.

[Interpreted] The major issue of Eiffage energy system compared to competitors, you can name them Spie, Vinci have a higher activity and a higher margin. Can we foresee that someday in spite of the private equity funds, Eiffage Energy will strengthen itself in this country?

[Interpreted] Absolutely, no ambiguity whatsoever. Many ways of strengthening ourself when we started in Netherlands, we acquired a well-positioned player, and we created a platform to do organic and external growth. In Germany, we have a certain amount of companies, entities who are very performing, but we do not have the firing power for future development and were favorable and to be able to create it one day. If you're talking about Germany, we could talk about our Spain. We all have our strong points, our specialties, right? If there's no more questions in the room, we'll take questions on line.

[Foreign Language]

[Interpreted] I'll have 2. Can you get back on the external growth? You gave us a road map. What you talked about Energy, it's obvious, of course, you talked about bolt-on, bolt-on is behind us. So what remains in the sector? It's a very fragmented one. What do you think about bolt-on acquisition type or what, to move the margin higher to regions of leading players on this sector? Shouldn't you do more acquisitions? What is the landscape? What can you say about that? And second point, Getlink. Can you give us your vision? Where do you stand, between 5% and 10%? What is the vision on Getlink in the medium range? Third, update on your dividend policy.

[Interpreted] On external growth, obviously, many people look at the very big players. But the market is really in small bits and pieces. When you look at the 12 acquisitions we made, we never found the great consolidators of the market. You all know in competition, because the market is so split, that most of those acquisitions are known through a specialty, through a territory, and it's our teams who know them and who bring them. It's bolt-ons that are not risky that integrate easily at generating value because they are acquired on multiples that have nothing to see with the major acquisitions. Then you're saying a very large acquisition to improve the margin. Well, there was a tremendous amount of work. We wanted to do it. Of course, there was enormous work. For the margin to be positive of Eiffage Energy systems, would have taken some years. I think that the 2 are not to be compared. What I would say is that when [ accounts ] was possible, we dealt with it, and we try to do it. But it's not the alpha and the omega we go on working in organic and external growth because there are a lot of entities of very small, medium-sized and sometimes larger, which are national players or regional players in certain amount of the countries were we're present, who seem to us really good to speed up, accelerate our development on the business of energy. On Getlink, no change. We didn't move our position. You have it as an addendum on what we have 5.6% of the capital. No discussion, we didn't change our vision. We remain -- I mean, it's a long-term concession. We're convinced that with time and time, the industrial sports will have more importance because the infrastructure is getting older and there's going to be more operational topics closer to our historical, our legacy it's an action which is rated, which is on the market. It's just the price to decide whether or not we choose to strengthen ourselves there. So no evolution on our positioning. Christian?