Eiffage SA (FGR) Earnings Call Transcript & Summary

Good evening. Thanks for being present at this meeting of presentation of the annual results, 2023 of Eiffage. I'm commanding the members of the management and the directors who are with us today. I picked -- I choose to start this with this video, which is really showing some highlights of the 30 past years of the group, 2023, marking the 30th anniversary of the brand Eiffage. As you have seen, the history is really full of major projects or major acquisitions that enabled us to change our dimension. This required to move the collective success under the banner of the group as a priority. This difference, we choose it to illustrate our new employee brand summarized by esprit de famille, family spirit. 2023 is an excellent vintage on all of the KPIs. Once again, growth of activity was supported by an increase of the results in Contracting as well as in Concession. Generation of free cash flow is very significant and enabled important investments of growth in Contracting and in Concession. And we experienced an order intake exceptional thanks to the attribution of civil engineering of the 2 EPRs of Penly and Bachy 15 East of the Grand Paris Express outcome of 3 years of intensive work of our technical and commercial lines of business. Those projects, mobilizing all of us are structuring for the pursuit of the development of the group, and the decade to come. We were already strong with a beautiful visibility in works, it has amplified. The global performance of our activity of commercial property in all the business lines delivers a stability, enabling us to roll out ourselves on projects more important on long-term dozens of millions at Eiffage Énergie Systèmes and Eiffage Route, over EUR 100 million with Eiffage Construction and Eiffage Métal and several billion euros at Eiffage Civil Engineering, Génie Civil, sometimes mobilizing several business lines of the group. For Eiffage Construction, '23 showed again the resilience of our model, builder promoter with beautiful contracts won and an improvement of our profitability contracting, enabling to offset the decrease of the contribution of real estate to our results. While maintaining good levels of profitability, Real estate is facing a decrease of 30% of the reservations. The ramping up of activity of renovation of buildings that I alluded to in the past semester, has confirmed as well as beautiful project of public equipment and a decision of sobriety and energy transition without forgetting a set amount of important industrial projects. Eiffage Construction won the contract for the design and implementation of the site regrouping the National Court of right Asylum and the Administrative Court of Montreuil, renovation of an existing building and building of 2 new buildings. Beginning of '24, Eiffage Construction was awarded the contract of heavy renovation of the Cristallis project in Paris, including 3 buildings for a total surface of over 25,000 square meters. And the continuity of a certain amount of treasury operations for the account of Covivio, Eiffage Construction and Goyer also won the contract for the building of the extension of close to 38,000 square meter of the Thales - Hélios in Vélizy-Meudon. And our teams will implement 2 of the 4 batches of new construction of the project of the reconversion of the former Saint-Vincent-De-Paul Hospital by the city of Paris, an Eco neighborhood, 600 housing units, places devoted to social and [indiscernible] economy as well as public and cultural equipment. Eiffage Construction started the works of the future building devoted to innovation in ecology, 25,000 square meters for Kadans Science Partner within the Grand Parc Villejuif campus. And our teams are finalizing 2 iconic buildings of the sports event that will be held in Paris, the restoration of the Facade of the Grand Palais and the [ Ethos ] Village in Saint Antoine. In real estate, we have signed with the CCI [ Aero ] a contract for the future campus Cambacérès in Montpelier, new neighborhood composed of 3 buildings for a total surface of 30,000 square meters, regrouping the school of Management Montpelier Business School and the headquarters of the Chamber of Commerce and industry. Highlighting also the beautiful development of real estate in Poland. On screen, you see two operations. [ Postepo ] in Warsaw, 430 units for a Scandinavian Fund and [indiscernible] in Poznan with 136 apartments sold by batches. In Belgium, the group was globally the second player in construction has rolled out a certain amount of iconic projects like the new headquarters of the Belgian Television called Media Square, the future building with a surface of close to 40,000 square meters will meet the evolution of the activities of the Belgian Television and will have a high energy performance. Our teams delivered also a new stational bosses positioned on the roof of the train station of Namur in Belgium. Since March 1, '23, it offers a secure and comfortable space for the users, while avoiding the traffic jams around, the road also. So a growth of activity of works with an order intake robust. [indiscernible] already, business is changing with the ramping up works in terms of soft mobility and urban design. Eiffage Route reduces its dependence on public investments and electoral cycles, activities thus more resilient. Beautiful example on screen with the design of the Chateau of Caen in view of its millenary 1,000 years that will be celebrated in '25. Innovative solutions are interesting more and more our public other givers, but also our private customers. Innovation is always there with the first use at large scale of the ÉcOasis solution Belleville-en-Beaujolais, a solution that is adding to the permeable plant coating and a reservoir road system as well as a suitable vegetation in order to reduce urban heat island phenomena. In Spain, the dynamic is strong, like the project you see on screen, a highway junction on the A 334 delivered in September '23. Eiffage Génie Civil has a very good visibility with major projects of infrastructure of transportation awarded in '23 in France, but also in several European countries. A good example, the 2 batches of the third line of the Metro of Toulouse awarded in February and March '23, for which we shall reuse 3 of the tunnel borers that were used to dig some of the lines of the Grand Paris Express. You can see the site for the reconditioning of those tunnel borers that will dig the 12.7 kilometers of the future C Line. The smooth running of our first Norwegian contract on Highway E Motorway E-18 enabled us to strengthen the second phase of the project that you see parts on the screen to EUR 600 million. '23, saw the materialization of the new contract in Norway, allocated by the second state structure, which is developing and supervising the road network. It is a major turn pike on the urban motorway E18-E39 motorway in Kristiansand. The implementation of 12 works, rebuilding of 1.5 kilometers of railroad and the redevelopment of the ferry terminal existing already. We remain totally mobilized on HS2 in the U.K., representing this year over EUR 640 million of activity globally for Eiffage. And we are already at 64% of progress on the major projects of A3 implemented in PPP for Eiffage Concession in Germany. The last of the 8 part delivery is foreseen in 2 years from now. Like during the first half year, Eiffage Metal enjoys a very strong growth in its activities of industrial buildings, works of art and, of course, structures and servicing the wind farms. The traction of Eiffage Metal with more than 40% of growth remains supported by the wind farms offshore in all of the European seas, but also with some export contracts in Asia and the United States. October '23, Eiffage Metal through Smulders won the contract for the manufacturing of the 76 pieces of transition for Baltic Power, the first offshore wind farm in Poland. This will be supported by the Belgian, British and Polish factories that I described last semester. On screen on the Rhine River, the new bridge of Leverkusen in Germany inaugurated February 4 '24. And in the line of the iconic buildings signed by Architect Frank Gehry, like Foundation Louis Vuitton, the envelope of the LVMH / Arts – Talents – Patrimoine will be also made by Eiffage Metal. Before discussing our multi-business projects, a glimpse at our façadier Goyer, delivering the greatest project of its history in Poland with the tower of the bridge in Warsaw and the greatest project of its history in France with the envelope of The Link, the future headquarters of TotalEnergies at Défense. Having delivered successful in '23, the first part of the gigafactory for the production of car factories for the joint venture ACC in Douvrin all our business lines are mobilized for the Phase II of this factory. Following the works of civil engineering that we have led since 2014, either on the extension on Line 14, North and South, the bundle 2b of Line 15 and the tremendous project of Line 16 will remain mobilized in the support of the additional batches allocated directly by the Society of Grand Projet, major projects. Line 14 is extended and the major station of Saint-Denis – Pleyel will be key infrastructure for the games, Olympic games of the summer. The most important part for the group in '24 will be the full production on the lots -- on the batches of stations for Eiffage Construction and Eiffage Énergie Systèmes and the 10 contracts of technical batches, all technologies for our businesses and energy. Now let's move to Énergie Systèmes branch. '23 confirmed the very good traction for several years now. The order book is full, thanks to the commercial property, which is doing very well. Grand Paris Express data center industrial investment, also the program of investment for hospitals in the cities of Lancé, Tours and Monaco or even Nantes that you see here on screen. Without any doubt, that the traction of Énergie Systèmes in all of our implementation in Europe, will be supported in short, medium range and long range by all the investments necessary for the transition -- digital transition and environmental and the evolution of the energy mix, like, for instance, the charge of electric cars, are things in the solar energy and the performance, representing growth relays on all markets. French train delegated to us, the deployment -- the rolling out and the operation maintenance of charging stations for its fleet. We shall install 5,000 points of charge on all of the territory within 4 years and then 6 years of maintenance. For several years, our strategy of external growth within Eiffage Énergie Systèmes is a lever for growth in the branch. The acquisitions of small-sized entities enable us to increase its territorial coverage and strengthen its expertise in Europe. The business line realized in '23, 11 acquisitions, EUR 500 million of activity, 10% in France, 90% in our target countries in Europe and over 2,400 employees who are joining us. One acquisition slightly more significant in the Netherlands was finalized recently. The society Van den Pol enables us to cover all our expertise on industry and tertiary. In '22 its sales was of EUR 75 million, and it has 250 employees. And mainly, as we wished, we led an acquisition, structuring acquisition with 51% of the Salvia Group in Germany. This company covers all of the cycle of the technical life of buildings and specialize in electric climate energy, civil engineering as well as in maintenance. 1,600 employees implemented sales to the tune of EUR 350 million in '22. Thanks to its 28 location. It is in all the German territory, especially in the tertiary and industry sectors. Beyond Europe, Eiffage Énergie Systèmes follows its development and export mode. As you see on screen, 2 magnificent projects of electrical station in Senegal for over EUR 50 million and the ongoing of the implementation of the line 400-kilovolt in Abidjan for close to EUR 30 million. In Spain, Eiffage Énergie Systèmes goes on with a very strong growth supported especially by its leader position of installation of sun farms and first network maintenance of the network needing very strong investment to guarantee the production of renewable energy, which is in strong growth in Spain. To conclude this 360 degrees of highlights, it seems mandatory to get back about the exceptional order intake for '23, enabling us to conclude the year with a visibility without any precedent since our order book is to the tune of EUR 26 billion, a growth of EUR 7.5 billion compared to the end of '22. We made a choice to present the book showing the flow on 1 plus 2 more years. The same presentation will be picked up by Christian in the slides line by line of the financial presentation. As you see on screen, the visibility was very good by the end of '22 and the changes, as I mentioned, by the end of '23 for the years, '26 and beyond. Indeed, the order book that will be on the '24 and '25 is slightly growing by 3% compared to the previous year. For '26 and beyond, this is essentially the commercial successes with the 2 exceptional businesses that are on the line of 15 of Grand Paris Express that will mobilize all of the lines of the group and the Civil Engineering of EPR 2-2 in Penly with over EUR 6 billion of this horizon are an illustration of this change of visibility in the longer run. On screen, the Line 15 project for an amount of EUR 2.54 billion, 70 kilometers of tunnel, 15 servicing works, railways, installation of a high-level electric current and low current and electromechanical equipment implementation of 6 stations. And the civil engineering contract or the two first EPR 2s in Penly, Normandy for over EUR 4 billion. Beyond this order of EUR 26 billion, we have also, as I said, half a year ago, the equivalent of EUR 2 billion of contracting that will go into the book when they will be delivered. And only a small part of it was performed in '23. In itself, the Nové contract represents EUR 200 million of activity in '24 and over EUR 400 million in '25 just for the Line construction, which is an asset given the situation of housing in France. Beyond those contracts in several years, which are significant that we'll get into the order book on the go, we have disclosed recently on 2 major projects. Rail Baltica in Latvia, where study started and should lead to our phases of work as of '24 for amounts of EUR 200 million each. And our last success A412 in Haute-Savoie supported by Eiffage Concession, and the implementation will be made by Contracting. We started exclusive negotiation with the Ministry of Transport in France for this new motorway link over 16 kilometers between Thonon and Machilly and a Concession for a period of 55 years. Okay. Let's move to Concessions. Beyond the success of A412, '23 was also very important with the implementation of a certain amount of major contracts awarded in '22 in the pursuit of development of our portfolio. You see on screen, our traditional spreadsheet that I have added to the one I have presented at half year. It integrates the Marina of Toulon and the A412 that I just alluded to. You see on screen a view of the Marina of Toulon. With our partner, Sodeports, we became an important player for the management of Marinas, thanks to the attention by the delegation of public service for 30 years of the 10 ports Marina of Toulon and the spaces, which is 3,500 places of parking for yachts. This project is an additional to the one of Marina Baie des Anges in Villeneuve Loubet, where the works have started representing 500 parking spaces. Building UCP Eco Stadium near Lille - d’Ascq has opened its doors to public in February '23, after a record year in '23 with several concerts and the World Cup of Rugby. The teams of [indiscernible] Stad Pierre-Mauroy are ready to welcome the 36 March matches of female and male basketball of the games of '24, plus 16 matches for final phases of handball. So that's 52 matches, 45 days of preparation, 15 days of competition, 24/7 a real challenge for our teams. The traffic of our 2 airport concession is rising by 10%, over 10%, supported by the opening of new lines international like Qatar Airways and Air Canada in Toulouse. Traffic is now 82% of the one of 2019. Since last summer, we were holding 100% of the Concession society of the Viaduc de Millau until 2079. We're very glad about that. You know our attachment to this project, which is part, as you have seen in the video at the opening of the iconic works of the group and work that we shall commemorate the 20 years this year. And a nice way since the Olympic flame will be passing this viaduct in May. And in September, we'll organize the seventh release of the Eiffage Race of Viaduc de Millau. We went on with our rising in the capital of Getlink and we hold now 20.55% -- 20.55% of the capital and two directors. This is a pillar of our capacity to keep in the long range our balance between concession and works. On motorways, '23 was rather dynamic in terms of traffic, especially for the light vehicles with a global increase of 2.5%. This was also the year of the free flow on Aliaé. 8 million clients went through our gates and joined a reliability and a service level of quality. We have to support the less comfortable clients with the new technology, simplifying even more their path of their way. But we made the essential to start this technology on the national territory and become a reference. The very beautiful activity of the service area of [ Beaubonet ] designed with the territory and which has registered a sales to the tune of EUR 10 million this year. '23 was also the year of the first anniversary of fully our brand, encompassing also the surfaces of mobility. In addition to the 850 stations of charge -- high-power charge for the cars, we are focusing on the charging stations for electricity and hydrogen for HGVs. In relation with the concedent, '23 started well with the signature of investment plan of EUR 410 million example, a small scale of what should be done for ecological transition of road transport with EUR 200 million for the return of concession of the 20 kilometers of the A6 and the total renovation. But it has been totally different. I cannot talk about the attack we experienced in our motorway concessions due to the will of our governments to implement a new tax in spite of their commitments to ensure the fiscal stability of our contracts. 20 year will be intense in our world to have our rights recognized and to ask for compensations facing this new tax. Regarding our carbon climate strategy, we're committed to reduce our direct releases, i.e., our consumptions, especially the fuel and gas representing 80% of our releases. Beyond our own releases, we have to help our customers to reduce their emissions by being an example of exemplary solutions in terms of low carbon but also in biodiversity. And since '23 we rolled out our strategy of circular economy by supporting the ramping up of businesses of innovation, selective demolition and improvement of the practices in terms of management of waste. Those businesses are pioneers to be in favor of the development of reuse and recycling. All our efforts were recognized by the SBTI, who validated our path of reduction of our greenhouse gas release for Horizon 2030. To be reliable in our strategy regarding our customers, we have to be an example. We signed a chart of commitment for the sobriety of the tertiary buildings with the French Ministry of the Energy Transition. But we carry on our investments with the renovation of our real estate and the implementation of charging stations and installation also of sun farms wherever possible. We are building new headquarters according to the best standards like the headquarters Eiffage Énergie Systèmes in Longvic that you see on screen, low carbon containers made by our subsidiary, B3 Ecodesign. To sum it up, 2023 has been a very good year. Performing from many point of views. The growth of our sales is always there, noticeably by an increased growth in Europe and on the business is very dynamic Eiffage Énergie Systèmes and Eiffage Metal. This development in concession and in contracting has been supported again by an improvement of our results and with the growth of our underlying earnings stronger than the one of the sales with 8.6%. Net result group grows by 13.1% enjoying also for the first year of the equivalence of the 20.55% of Getlink and reaches EUR 1.013 billion. Thanks the very good operational performance, but also to the good position of the cash flow we have a free cash flow reaching a historical level at EUR 2.3 billion. Net gearing decreases by EUR 250 million, while we went on with our investments enabling to strengthen our portfolio of concession and the pursuit of the strategy of external growth and contracting, especially in the energy system branch. And as said previously, our order intake is growing by 40%, thanks to the two major contracts of the Line 15 East and the Civic Engineering of the 2 EPR 2 of Penly offering us an unheard of visibility for '26 and beyond, while making sure that '24 will still be growing in a more moderate way. Our activity contracting will be rising in '24 with, however, an organic growth less sustained than in '23. The activity of our Concession is also expected to be in growth in '24. The results in contracting will be in progression. Those in Concession will be strongly impacted by the no tax on the transport infrastructure. Hence, the net part group of '24 should be more or less the same as in '23. Thanks to this very beautiful year, we shall propose, suggest to the General Assembly of April '24, a dividend of EUR 4.10 per share for '23 an increase to the tune of EUR 0.50. Thank you for your attention, and I leave the floor to Christian Cassayre to give you a detailed explanation for the financial part.

[Interpreted] Good evening, ladies and gentlemen. I'm going to give you the financials of the presentation. First, we're going to look at a business review. 2023 was yet another year of steady growth, plus 7.4%. It was plus 7.1% in Contracting and 9.2% growth in Concessions. Concessions benefited from 3 new operated assets, Nové, A-79 on a full year basis. And Sun'R, which was acquired at the end of 2022. Three assets that contributed 3% of the 9.2% in growth in Concessions. On the right, you have the strong buoyancy of our European markets outside France, plus 16.4%. We have chosen to now show you the numbers over a period of 5 instead of 2 years, which really gives some outlook to what I'm saying because the yellow part is up 60% over a 4-year period before our last 2 acquisitions in Germany and the Netherlands. In Contracting, well, I need to say two things. First, on the left-hand side, you can see the average growth, 7.1% but there are strong plus and minuses according to business lines with 2 business lines that benefited from buoyancy described by Benoit whereas Construction was hit by the new housing crisis. But it didn't really dip that much. And on the right, you see that the share of contracting outside France is now 37% of the total versus 31%, 3 years ago. And share of the business outside Europe once again shrank. So first, look -- let's take a look at our margin in contracting South African 4% growth. Profit from recurring operations up EUR 19 million, 13.9%. In other words, 2x faster growth than sales, which was 7.1%. In Concessions, the drop in margin that was already seen in the half year, was to the dilution generated by the operation of three new concessions, the ones I mentioned. On a constant scope basis, the margin would be 47.5% Also, there is an increased amortization at APRR due to the commissioning of a few large investments. We're looking at EUR 49 million in additional amortization. Now regarding the holding company, there is additional expense with the group savings plans following new calculation method following a change in policy in France. This is a noncash expense that we also mentioned on the 30th of June. In spite of the last 3 items I mentioned, operating margin for the group was slightly up 11%. In Construction now, the dip in the business in France, minus 4.5% is due solely to the drop in sales in property development, 27% less. Construction only in France was stable, plus 0.3% given the diversification of the business line in segments other than new housing. In Europe, Belgium and Luxembourg fared well. Business picked up in Poland. And altogether, the rise is 5%. And you see that the margin showed 3.7%, which is good. And this owns quite a lot to a never selective policy when it comes to picking up business. You see that the log book is, doesn't really increase that much. And the share to be done a year later, slightly down. We have to take note of inspiration there and the solid performance of real estate with a 7.1% margin. But of course, the business was dropping, so the real estate contributes EUR 59 million of profit from recurring operations versus EUR 83 million in 2022. The drop is offset by a better performance in contracting. In infrastructure now, the stable business in France conceals pluses and minuses going through business lines as seen here with the drop in civil engineering, 11.9% can be accounted for by the EUR 340 million drop in business in the Grand Paris Express projects, EUR 570 million in 2022. Road works showed resilience in spite of a drop in tonnage in industry with more urban development and private markets. And the exceptional growth in Metal, plus 41.8% was boosted by wind energy. A similar figure in international operations, plus 45% actually. In civil engineering, our subsidiaries in Germany, experience double-digit growth due to good progress of highway A3, a PPP right there. Our projects in the U.K. and Norway are in full production spring. The operating margin rose to 3.2%, up 30 basis points, owing to the increased contribution of metal, but also to the increased margin in civil engineering and Road works. I won't come back to the logbook, which was commented upon at great length. Energy Systems. Well here, we're looking at solid 11.6% growth, and this has become a constant double-digit growth over the past 3 years. The contribution of acquisitions is 3.6%. The contribution was 4.1% in 2022, and it will be even greater in 2024. So there, again, we have a constant the contribution of external growth is recurring and it does materialize. The growth rates by geography that you can see here may be surprising, but bear in mind that in France, at the end of '22, we integrated [ Reso Mobile ], a company that we acquired from SNEF. So sales -- international sales low due to the termination of transportation lines in Germany in 2022 into another 6% drop in non-European business. Operating margin was significantly up 5.4%, owing to market buoyancy that was mentioned and that allowed us to remain selective. And we look at added value in our offerings. And of course, volume has stepped up somewhat. And you can see that the log book gives us greater visibility. And of course, there are the acquisitions that have, that were finalized in January, stating the obvious. Over the past 10 years, Eiffage has been supporting athletes through a performance compact. And so this is a compact time between the state companies and athletic -- athlete organizations to help and support high-level athletes. Since 2014, we've supported 30 athletes across our business lines. So we're looking at BMX, Boxing, Judo, Fencing, Hammer Throw, High-jump, Paracycling, Rowing and Paraswimming. That's for our contracting line. In Concessions, Here, you have this new chart for you. It gives you our main assets, and some of you have requested this information. So here it is for you. On the left, you can see the deadline of our concession and our stake. And on the right, you see the contribution to sales over a 5-year period, which helps you understand, especially if you look at the bottom and they ramp up of new assets in three different sections. First of all, we have a certain number of new highway concessions shown in red. This does not yet include ADELAC concession holder of A41. Sales will be consolidated in 2024. Sales amounted to EUR 68 million in 2023. Then you have the two airports, which we operate, and you have other assets, especially in PPP, but you must bear in mind that these are assets that we consolidate and for which we have a different economic interest. On the bottom, we have an average of 75% of the -- versus 52% of APRR. Of course, these figures do not include our 20.55% stake in Getlink which is consolidated on an equity basis. So what about the profitability? Regarding APAR, this is the usual financial indicator chart for you. You have A79 right there, and it does show it's a mirror of the consolidated financial statements of APAR. Traffic was robust in 2023, and the EBITDA margin rose 20 basis points in spite of the dilution with the startup of A79 a 20 basis point dilution. Apart from that, we were up 40 basis points. If you consider APRR, AREA, that scope only. Over another word about our non-APRR highway concessions, and let me come back to airports. And here, you have the contribution to EBITDA and margin levels. You see EBITDA over 72% on average for highways, most recent highways, good performance there. Regarding A79 we are a direct operator. And we integrated EUR 10 million in sales of the service area, which is a major contributor to results, but it's dilutive in terms of margin, of course. The Lille Airport who was awarded through call for tenders, not much capital employed so far. On the right, you have the contribution of all of these assets in terms of profit from recurring operations. The other PPPs are shown here, EUR 96 million on the whole, including EUR 68 million for BPL. The other PPPs are Nové, smaller PPPs in construction and the corresponding maintenance business. So much for our consolidated Concessions. So, this does not include Getlink, Getlink which has been consolidated on an equity basis since 27th of April 2023. On the right, you have the key 100% numbers historically, the sales, net result because it's a share of the result that we're integrating in our results, of course. We integrated EUR 25 million in net profit based on Getlink's EUR 296 million result. This is the Bloomberg consensus that was released a few days ago. The final numbers will be published tomorrow. We took into consideration an amortization of goodwill, EUR 13 million on a full year basis. All this has been prorated since April 27th based on the level of our stake. So much for our operating performance according to our concession assets and according to the various BLs in contracting. Concessions also support high-level athletes, Para-table tennis, Modern Pentathlon, Taekwondo and Race Walking. We do hope that everyone will be qualified this summer. Some of these athletes were already competing in Rio and Tokyo, by the way. So let's take a look at the financial statements. So the consolidated statement of income. So the operating expenses and income items, EUR 51 million. First, I must point out an up valuation of profit because of the ADELAC control now, EUR 74 million and a nonrecurring expense of EUR 47 million due to the discounting of the calculation parameters of the provision. And these two elements do not have any impact on cash. And there is a, there is a share of minorities. The cost of financial debt increased EUR 41 million, including EUR 32 million for APRR and [ AFRE ]. The other income and expense items include EUR 33 million in profit from Getlink, which is now in the consolidated scope noncash, already recognizing the counts as at June 30. Income tax, EUR 544 million. The rate is 26.7% identical to 2022. Net attributable profit, EUR 1.013 billion net EPS, EUR 10.65. So debt is shown as usual here. EBITDA is greater than in 2022, EUR 350 million, greater almost. Change in working capital requirement once again generates cash, EUR 359 million. All of this in Contracting. And the 4-year total is over EUR 1.1 billion evidence of the robustness of our contracting performance over all these years. The evolution of the indicator is provided in the appendices. Interest and tax already paid out increased EUR 110 million, including EUR 85 million for taxes, which makes sense. Operating investments in contracting increased EUR 654 million with more energy renovation, great examples that Benoit showed you and there were industrial investments in Metal to follow the growth of offshore wind energy. So this is where we invest quite a lot, I must say. In Concessions, investments are down, but the 2022 number mind you, included EUR 222 million for the end of the construction of A79 highway. The following flow shows the payback of debt payables in PPP cited as. And Free cash flow, EUR 2.271 billion, up over EUR 0.5 billion due to the increase in EBITDA, the drop in working capital requirement and the drop in investments and Concessions. So we were able to finance EUR 541 million in acquisitions, including the 49% purchase of the stake in the viaduct, the ramp-up in our stake in Getlink and the smaller acquisitions, especially Energy Systems, the latest acquisitions of Salvia and Van Den Pol were cashed out in January 2024. Nevertheless, we invested precisely EUR 2 billion in external growth over the 24 last months which is quite substantial. In other variations, you have the net debt of ADELAC consolidated EUR 636 million. And also, we decided no longer to include our purchasing options in our financial debt. I'm talking about that, which we have with our minorities, minority shareholders. This was under other liabilities, EUR 166 million at the end of 2022. Capital-based transactions. We have the dividend that Eiffage paid out in 2023, EUR 351 million, given paid by APRR to its minority shareholder. And we have the reinforcement of our treasury stock, 4.1% at the end of '23 versus 3.4% in 2022. Net debt amounted to EUR 9.9 billion, down EUR 250 million, EUR 900 million before the consolidation of ADELAC's debt. Our debt is broken down between nonrecourse debt for concessions and the cash of the holding and contracting. Nonrecourse debt is shown in black, contracting and increased near EUR 130 million in spite of the takeover of ADELAC's debt. The holdings cash and concession -- and Contracting''s holding in red benefited from the good operating performance of Contracting in terms of profit and working capital requirement and it closed at nearly EUR 1 billion. Same number as at the end of 2021. In spite of our investing EUR 2 billion over the 2 years in external growth. Strong performance of our model in terms of cash generation, WCR management in 2022. We sold off APRR financed by as you know, it turned out into nonrecourse debt. Quickly now, the log book, it was commented upon by Benoit as far as the left part is concerned . On the right, you have the details by business line, unsurprisingly, very strong visibility in the medium and long term as far as infrastructure goes, and there's less visibility in Energy Systems. Construction is resisting given the markets that the business line is involved in. Thank you for listening. I'm done with the financials. At this point, we can move on to the much awaited Q&A.

Good evening. I'm with City Morgan. Thank you for the presentation. I have several questions, if I may. Let me start with contracting and log book quite impressive, I must say. You were told that log books are up 40%, but there are new contracts that you've already secured. So my first question is, how many projects have you secured that are not yet in the log book? And when will they be in the log book? My second question in contracting again, you mentioned strong visibility in terms of contracting sales with the strong loan book, but you said there was a mere 3% rise in 2024 and '25 even. Is this before the new contracts are secured in the loan book? Or does it take into consideration everything you've already recorded and booked? And still in contracting, could you give us more flavor regarding the margin of the logbook for these. Is the risk profile different with the size of the projects that has become larger? And later, I have a few more questions, if I may.

Why don't we show the last slide of the log book at this point. Well, I only mentioned 2 projects that are not in log book. There's still some recurring business, but that's not what we're talking about. The only significant contracts are Rail Baltica. It's a rather specific contract because we've secured a contract which involves EUR 20 million in engineering to look at the portions that need to be done, we will agree with the client. We're looking at anywhere between EUR 160 million and EUR 300 million for each portion. When we agree on all that, we give reference price as you see. And then when everything is ready, we will be given a purchase order, and we will roll out what we have to do for the first portion. And we have engineering teams that are working on the next portions. So over time and over a long period of time in 2024 -- apart from 2024, there won't be any impact on Contracting. Contracting will kick in, in 2025 at best. So things will become significant in 2026. The second one is a A412. We're negotiating with the Ministry of Transportation, you have to work on the contract, you have to sign the contract and then we have to speak with the authorities and the French Conseil d'État and the commissioning of the work, of course, takes far more time, which is why I took some time to explain that many of these significant contracts that completely changed the structure of our log book virtually have no impact in fiscal '24. It starts kicking in, in '25 and '26. If you take a look at what we have on the screen. The 3% is the blue part of the graph from 11.9% acquired last year. The only contract with engineering for the EPRs and 15S, that is included. The only significant part that's not included is EUR 200 million in business for Nové to be done by Eiffage Construction. It's not yet in the logbook. That's the EUR 200 million only, but everything else is in the logbook. And then regarding margin and risk profile for what we have in the log book, essentially, the 2 big ones, profiles have changed because, as you know, the Société des Grands Projets, as it is now called amended its master plan for 4 key contracts of the new phase, including Line 15S. We were in construction only, but now we're moving on to operations as well. There is a major difference with this approach now because we've done engineering last -- has had to last much longer in terms of contracts more robust. And for some years now we've had many teams working on tunnels in Paris and around Paris with the same clients, with the same demands and so on. So the knowledge of the risks has become greater. All this has been factored in by our teams. But fundamentally speaking, the risk profile is different from what we've experienced in the past. And finally, the 2 EPRs the Penly engineering work, you have the conventional work with EDF, we're builders only there. Therefore, we will work according to what the client tells us to do in order to make progress with their project. In the short term, we're focusing on engineering, design and the start-up commissioning, which should be this summer provided we get the environmental authorizations. There's a typo on the right, the 21% and the 31% should be switched around.

Okay. I will continue, if I may. Since we were talking about margin in Concessions, you told us that Concession margins were impacted by new concessions. Should we expect more dilution, even more dilution in 2024? Or are you looking at stabilization? And, if you're not looking at stabilizations, when do you think the margins could stabilize?

Well, we don't have the equivalent and the entrance in the consensus. The only KPI you have to have in mind is the CapEx of APRR. When they are in production, they generate like on the previous networks and concession, they are amortized only by the end of the concession. EBITDA will increase in the legacy part, but in part will be decreased by the dilution. We had no effect on the operational margin of the concession. We had three new concessions in the same year.

Crystal clear. Thank you. On the free cash flow, a strong progression, EUR 2.3 billion, is it sustainable? And since you have so much visibility on the activity, can you tell us a bottom free cash flow? Well, some took some risks to do that, and they regretted it.

No, no, no. I will not do that. No. You have to have in mind that it's very volatile with the major projects, we cannot take any commitment, no. I would say that the other flows are normative of taxes, interest, EBITDA, there will be no decrease in EBITDA. This is the need in the free cash flow that is important. At this time of the year we cannot commit ourselves. EUR 2.3 billion, minus EUR 300 million, if worst comes to worst.

That's what you say, now another problem. The taxes Concession, as you said, which are not foreseen. What about the discussion with the government now? How do you see things moving us from now? Is there a risk to have an increase of the tax. We heard also a rumor, I don't know where it comes from, saying that the government is having a cohort tender when the concessions will come at maturity.

Well, Philippe needs to talk to you about the tax. He is the expert in the Senate Commission's National Assembly.

Hello all. So on the tax, we are determined to fight and to use all the possible means to combat this tax from a legal point of view. Well, update, as you know, the Constitutional Council has been summoned by a certain amount of senators and members of the parliament of national assembly about some items of the -- the budget law, including the item about our tax. Well, the decision of the Constitutional Council was published December 28. In fact, the article has not been invalidated but hasn't been validated either formally on its totality since the Constitutional Council focused on the arguments used by the members of the parliament. So, the next step is the questioning of the decrease of implementation published February 9. And questioning through a recall an excess of power in front of the Council of State with a constitutional priority question. If this first line of defense, constitutional defense, we will see an outcome by the end of the year -- so it's going to be quick. If this first defense is not successful, we shall start the second recourse, contractual recourse in order to obtain a compensation with a time frame that will be longer to have the final decision.

So in terms of compensation, you imagine that the government will be -- give you some cash?

We're open to any kind of solution. We don't see the tariff option. Given the financial challenges, this tax is not deductible. And for [ APREA ], if we base ourselves on the figures of '23, it's EUR 120 million. We don't see how financed by tariffs, this operation, how to offset it, given the remnant time till the end of the concession. We can imagine other solutions, for instance, the extension of the time of the concession. The only thing that we will have is the implementation of the contract. This is what's going to fight. We have to get back the balance and all the methods were used in the past.

Any other question?

Augustin Cendre, Stifel. I have two questions, please. The first is your Energy System department. You increased your margin by 13 basis points and you reached a margin of 4.5%, which is close to your target long term of 5.5% to 6%. With a view of '24, is it possible to increase this margin? The inflation environment is behind ourselves? My second question is regarding the CapEx.

You're right. We always talked a few years ago about the target or progression little by little step by step of the energy system to go and get 5.5%. We're getting close to it. In the meantime, the dynamic of the market, we made a lot of organic growth and external growth. We have a better coverage of the territory. If you are consistent on the territory, you have a better amortization of the structures. We're convinced now that this is shared by [indiscernible] CEO of the branch that we can do better. This is the aim seems the rationale, seems logical, and we should be able to go on progressing the way we did in the past. I mean there's no reason today given the markets that we have not to go on to improve the margins. CapEx, do you want me to answer?

Well, contracting, we have to extend the figure of this year and amended by the increase of the growth of the contracting. It's normative. And concessions project EUR 330 million on APRR and EUR 300 million on the other concessions with airports, the ramping up of the [indiscernible] log [indiscernible] the CapEx on the various other PDP road or buildings.

One last question regarding the Olympic Games. Your activity of contracting. Is it at risk in France this year due to works interruption for the Olympic Games?

It's rather complex currently. We don't know at all what will be the decisions taken, they'll possibly be locally impact. It's not very important. Conversely, you have also possibilities. The other way around when we write a contract, we manage all the contract of lighting of the city of Paris. They will ask us to increase our capacity of intervention. So the elements are in both directions. So at the scale of the works we have in the group, possibly will be impacted, but they will not be significant right now. There's no clear will to stop massively the activity. So currently, we're not expecting perturbation, which would be important enough to impact the operations of the group.

Okay. I'll take the mic again. Construction margins decreased due to the situation of real estate? Can there be an upturn in '24?

Olivier? We're all very interested by your answer.

Well, real estate probably not. So the challenge is to know if the works contracting will go on to offset the decrease of the real estate. We're not worried globally speaking. It's not very clear. On another topic, I mean, what I can add is we will go on having a decrease of real estate in terms of activity. So even if the profitability of real estate is maintained, its contribution to the results will be equal to what it is this year. It might have a slight impact. We imagine that the performance of the building of the other real estate as you have seen in '23, there's no reason for it to have a reverse position. If it's more tense, it's not significant. And we hope to be able to maintain the levels of margins that we have today and to be able to go on offsetting the loss of the contribution of the real estate to the results of the line of business.