Eiffage SA (FGR) Earnings Call Transcript & Summary

Ariane 6 is a program launched by the European Space Agency. Ariane Group built the launcher and Eiffage was involved in part of the construction. This is footage of the initial earthworks. This is the mobile gantry, the rolling area. This is the gantry itself. It's mobile. Frame -- scale frame is 7,000 tons, 90 meters high. It moves on a distance of 140 meters at a speed of 7.6 meters per second. This is the launch pad. There are 2 exhaust collectors, 170 meters in length, 30 meters underground, 30,000 cubic meters of concrete 4,500 tonnes of frame and other infrastructure. Liquid oxygen galleries, cryogenic storage facilities. These are the support facilities. This is the launch or assembly facility, 900 tonnes of frame storage platform. This is in French Guiana, by the way, I forgot to mention. This is the water castle, 1,200 cubic meters of water storage, 90 meters in height. Ground control. This is the automated workshop for the rocket nozzle production. Electric infrastructure and IT for Ariane 6. Maintenance and operations were done with other companies working with Eiffage. Take off on 9th of July 2024, the inaugural launch by [ Nessa ] and Ariane [indiscernible]. There were 4 European subsidiaries of the group involved. There were 4 business lines, as you can see here. 650 pairs of hands on deck from Eiffage.

[Foreign Language] Good evening, everyone. Thank you for being here. Thank you for attending this presentation of the H1 results. I would like to greet the members of the Board and the management committee who joined us tonight, including Olivier Berthelot, who is now the CEO of Eiffage Construction. He came to office on the 1st of July to replace Olivier Genis, who retired after 40 years in the company. I decided to start this meeting with this film showing the involvement of many of our business lines in the building of the new launch pad for Ariane 6 rocket in French Guiana, the successful launch on 9th of July was a reward for the hard work done over the -- since 2015 and, more generally, over the past 55 years there in French Guiana, at the space center where we have been involved ever since its inception. Moving on to the highlights of H1 2024. All went well. We have the confirmation of the trends already seen in H2 2023. Business activities remains intense in all our business lines with the exception of property development, which may have hit its lowest point now, but there's even better visibility over the next few years, especially at Eiffage Energy System and Eiffage Construction. As I was called out back in February, we ended 2023 with extremely good visibility, unprecedented visibility for the contracting business for both the medium and long term, especially for the 2 major contracts with the 915 of the Metro line and EPR 2 in [ Pali ], which will continue over 2026 and beyond. Apart from that order book worth EUR 26 billion, I also mentioned these new contracts that are coming in, in particular, the construction concession contract for Nove for the Defense Ministry, that was worth about EUR 2 billion at end 2023. In H1 2024, the momentum continuing and now is -- has encompassed all or most of our business lines. And so we have even better medium- and long-term visibility, especially with the contract with EDF for the supply of 24 diesel power backup, emergency backup systems and 6 nuclear power plants, EPR 2 plants, in [indiscernible]. And we're working in a consortium with other companies for a market worth EUR 900 million, which will roll out over the next 17 years. We've also been selected as part of another syndicate with SNCF Reseau for 2 lots, regenerating tracks between 2025 and 2028. The overall amount has been confirmed at EUR 450 million once the annual tranches, there are additional optional tranches, for 2028 to 2030, the amount of which included that could reach EUR 800 million. First lot replaces track equipment on the high-speed trains on the Atlantic branch, Northern Europe and Southeast Europe. And the second lot is the regeneration of standard railway lines for the domestic railway system. On offshore wind turbines, we finished a contract for 4 electric substations in AC current on Prince Elizabeth Island and that will be the future artificial energy island that will be a first to be built 45 kilometers off the shores of Belgium for the Belgian electricity grid. It will be a centralized energy hub, and it proposes to interconnect with other countries, providing electricity to different connected countries. The building of these substations will start in May 2025, will continue as late as May 2029. It should enter -- it should be commissioned as early as 2030. As you saw, as you heard last week, we also won another contract, again, as part of a partnership, to build the civil engineering project on the Rhine Main connection for [ Amprion ] in Germany. So the purpose there is to have a cut and cover passengers for 600 kilometers worth of energy corridor in Lower Sax, in the economic area of [ Hesse ] to -- and then there will be docks to carry electricity cables connecting the offshore wind turbines of the North Sea towards the Rhine main areas. And once the design phase is completed, we'll complete the work between 2028 and 2030. And we also have won the contract for the design, building and operating over 5-year office buildings for the Interior Ministry in [ San Sunny ], the amount is EUR 700 million. And through Eiffage Concession, we have a new motorway connection, 16 kilometers between [ Tuno and Mashile ], for a period of 55 years. We've been granted the contract, but we're waiting for confirmation from the French government. Once -- these are significant contracts, of course, in terms of size, but we have many smaller contracts in our order book, and that is for recurring activity around the country. But also abroad in Germany, in particular, we have won the contract for a railway bridge, a metal bridge in [indiscernible] in Hamburg that bridges long -- is 110 meters long, 25 meters wide and weighs 4,000 tonnes. In Belgium, our teams, again, as part of the syndicate will build the Realex tower at the heart of the European district in Brussels, that includes the conference center of the European Commission, but also businesses and offices. In Spain, we are also working in PD farms. We have as many as 14 new solar farms built in 2024, generating about 1 gigawatt. And for Eiffage Energy Systems, we have about 1.4 gigawatts this year. As part of Grand Paris Express Eiffage Energy System has been tasked as part of the synergy to maintain the multiservice network and the monitoring systems to ensure security online. We'll have as many as 1,500 video cameras, but also 1,300 access control terminals, 500 cameras on the trains themselves as well as 2 data centers that will house all the systems. And a part of our organic growth with new orders, we were also very active in terms of external growth, especially at Eiffage Energy Systems. So the acquisition -- well, acquisitions enable us to broaden our territorial coverage, having more expertise around Europe and, therefore, generate more growth for that business line. As 2023 alone, we've achieved as many as 11 acquisitions worth about EUR 500 million for the full year, 10% in France and 90% in European target countries and as many as 2,400 new employees. A good example of that is the Germany strategic market. In 2023, we already had a few units in a couple of regions, but that didn't enable us to become domestic players to cover all the markets in Germany. But when we acquire Salvia and [indiscernible] we hope to finalize this by in Q4 2024, but we still need official authorizations from competent authorities. Eiffage Energy Systems should be in a position to generate as much as EUR 1.1 billion in revenue with 4,500 employees. As you can see on the map, well, we do have a full domestic coverage, but we also have a strong presence in Austria. That's our first inroad into Austria. Another example is The Netherlands. Eiffage Energy System came into The Netherlands through Kropman that we acquired back in 2018, generating about EUR 150 million in revenue and 800 employees. And in 2024, after some organic growth, but a few targeted acquisitions, now Eiffage Energy System has a headcount of 1,900 employees and EUR 400 million in revenue. We're now in the top 5 players, again, a major domestic player covering the entire territory in all business lines. And last example -- and that's an innovative example of organic and semi-external growth, enabling us to develop our business in a technological niche. And that is the co-enterprise that we created with NTEC dedicated to the design integration of storage system, the building of connection substations for high voltage networks and the high-voltage grids, driving tools for the securing of batteries as part of wide-ranging projects. The targeted project's are the storage units, battery storage units located in domestic France and connected to the high-voltage grid. These projects have become a significant as far as representing a growing part of the renewable mix of the various European power systems. Going back to what I said at the beginning, we have unprecedented visibility -- we had unprecedented visibility already at the end of 2023. A significant highlight of the first half of the year has enabled to grow our medium-term order book in all lines, especially at Eiffage Construction and Eiffage Energy Systems, but we have also significant growth in the order book in Europe outside France. Regarding our business, it is looking good, especially at Eiffage Energy Systems and Eiffage Metal. And we enjoyed a 6.5% growth in our contracting business. We've enjoyed several years of growth in Europe, both external and internal organic growth. But the contracting part of our business now, 40% of that business is outside France. I'll give you a few examples. What you have here on the screen is the winter garden in the [ Ursuline ] institute that we restored in Belgium. This is a listed monument that was built back in 1900. This is, of course, in the [ Art Nuvo ] style back to its former glory -- built back to its former glory. We also renovated the thermal bath of [indiscernible], it's a reference in France for respiratory disease. We have as much as 4,000 meters of roofs that had to be restored, including 3 domes. But there's also interior renovation and of course, the energy adaptation of the thermal bath themselves. A significant part of our business is, of course, the road business and urban design. So we broadened the road at [ La Roche ] to make more room for pedestrians, on side works, but also more space for cycle lanes and handicapped users. Regarding public transportation on-site work, we have been working a lot there, lots of business in the contracting line. We have on the screen the new tramway lines in Leon, T9 and T10 as part of urban design. It's not just the tracks for the tramways, but of course, broadening cycle lanes taking precedence over cars. A good example of energy rehabilitation is a project we've been developing in [indiscernible] 362 units. This is a construction site with significant environmental challenges in terms of technological performance, but also preserving biodiversity. The first example of the motor work -- one example of that innovation is the [indiscernible] solution using granulates with optimized rolling quality. It was developed to improve resistance to friction, maintaining a high level of safety. That solution proposes to reduce the Scope 3 emissions as part of -- for high-traffic roads. We're looking at a lowering, of course, of CO2 emissions, but also savings in fuel. And then we designed a new hospital, [ Paris Saclay ], 3 years in the making, 45,000 square meters, 480 beds and 8 operating theaters. This is a set of hospitals in [indiscernible] single site, a very ambitious site in terms of innovation and technological excellence. We also built a walk bridge, [ Robert Pujad ] over [indiscernible]. This is a cable state, a non-symmetric cable state bridge, 165 meters long, a single pole, 65 meters high, for soft mobility pedestrian and cyclists. Regarding the concession business, our business is driving again up 5.6% with, of course, the integration of ADELAC over the full year and the upscaling of the A79 motorway, where traffic is up 9.2%. Even though traffic is slightly down 0.9% on APRR area, the business as a whole remains steady. In fact, has been able to grow, thanks to higher fees. The main issue, of course, we have is a tax on long-distance infrastructure, which, of course, has a significant impact on our performance in our motorway concessions. We've been challenging this at the highest court in France, the constitutional court and council state, we're expecting a ruling from the council in September. Ever since its commissioning in September -- sorry, it's opening its commissioning, A79 has been growing ever since. It had as many as 8.2 million passengers and -- sorry, cars going through it. And with a growing trend, as you know, it's the first fleet free flow motorway. Most of the tolls are paid in electronic tools, 2/3 of them, 30% on the online and 3% at tollgate itself. And since the month of July, passengers on A79 motorway can also pay for the toll at tobacconists 8,000 shops are providing the service, and that is -- that has been developed in France by FDJ. As part of the stimulus plan, the most significant project was the complete rehabilitation of the A48 network, and that has brought together the necessary expenditure investment to address the issues of the environmental transition development of biodiversity in urban areas. You can see the results on the sides of the motorway, you have completely green areas. You have been able to reclaim the land along the [indiscernible] River, and that is a remarkable success and very much appreciated by local inhabitants. Regarding airports, traffic is up, slightly up from 1.5%, but business is up 7.9% thanks to a buoyant commercial momentum. Internationally, business is growing. And indeed, this has somewhat offset a decline in domestic traffic with a high port station for buses, for passenger buses. The Toulouse Airport is now a pioneering in Europe for hydrogen solutions. The Nove contract, and that's for the Ministry, the defense ministry and its ambition [ Femi ] plan. This is going in full production. We delivered the first projects with these new buildings, as you see here on the bridge. The Nove contract by 2028 will be worth EUR 1.5 billion over the French territory. And a few yards away from us, we have as many as 5,000 paralympic athletes. So we need to talk about sports. And I would like, by the way, to thank you for making it tonight in spite of traffic restrictions. Eiffage has been working with sports for many years. We've been supporting high-level athletes and we have connections with sporting events, encouraging all those involved in physical activities. And in fact, we felt we should have a reminder of our involvement in sports with this new book called [indiscernible] team play, you were provided -- or you will receive a copy. We would also wish to remind you of all the activities we've been conducting to support this major sporting events, starting with the athletes' village. The extension of Line 14, to the north and to the south, which was opened up on the 24th of June, 2024. Line 14 has become the longest metro line in the Greater Paris area. It now connects the new station of [indiscernible] Airport in 40 minutes. By 2025, 1 million trips will be carried out every day on this line. The [ Santoni ] station was inaugurated at the end of June, and we were in charge of civil engineering and the railway work. It's 28 meters underground. There are 4 levels, and it has a capacity of 200,000 travelers per day. the restoration of the Grande Pale, and this is where our subsidiary, [ Pad Mora ], was involved. It specialized in the renovation of historic monuments. Our teams took part in the restoration of the stone facades, the brick lane, the lead removal and roofing. The foot -- the low carbon steel and carbon foot and cycle bridge, which connect [indiscernible] 130 meters long and 16 meters wide. This is the reservoir tunnel, VL8 it's called. The idea is to avoid the untreated water outflows in the natural environment. It strengthens the existing sanitation networks capacity in the face of climate change, which leads to rainfall that is more and more substantial and Sun'R teams were involved with other companies in lot 3 of the tunnel. Owing to its modular nature and its convenience of use. The [ Pima ] stadium brought in international competition for several sports ever since it was commissioned. This summer, for instance, it accommodated basketball and handball competitions. And there's public lighting, too, with traffic lights and the lights of the city of Paris we're in charge of the management and maintenance. As I was saying, the group contributed to creating a connection between the organization of sports events. Therefore, I encourage you to take part in the upcoming edition of Eiffage Race on the [ Mio ] viaduct, it will take place on the 22nd of September. It will be the pinnacle of the 20-year -- 20th anniversary of the viaduct and will be quite a few events in the 20 days prior to the race. I also wish to speak about the company's overall performance because that is what actually ensures its quality and lasting nature. There's financial performance and nonfinancial performance. We take a look at the whole value chain. Our aim is to bring meaning to the work of our teams, help them be happy at work, and that is how our jobs can be very meaningful. Human resources are at the heart of our concerns, so is the climate, low carbon activities, biodiversity, corporate governance, and you can see our nonfinancial rating up on the screen right now. Quite naturally, the expectations are rising year-on-year, and we have to maintain our rating. And that is quite challenging for all our teams. As you probably found out this morning, our efforts have once again been acclaimed by SBTI. In 2023, SBTI approved our trajectory for GHG reductions in the short term, 2030, and it has just approved our trajectory in the long term by 2050, that is for scopes 1, 2 and 3, the alignment on the 1.5-degree trajectory and the -- our commitment to reach net 0 emissions in GHGs throughout our value chain in 2050. Decarbonation means that all our teams must be on deck and we must be involved in virtuous processes in order to have no-nonsense carbon performance numbers as well as technical and economic numbers, which thus designed a marketplace. And all the products and items that we offer are backed by a specific life cycle analysis. The aim is to guarantee reliable environmental information according to standards for all our products and carbon measurement has thus become a new standard in the realm of procurement. We are still calling for innovative solutions that are low carbon and climate friendly through our Sekoya platform. The solution call was dedicated to 2 crucial themes this year. First, data serving environmental performance and sobriety at the heart of construction solutions. The purpose of this initiative is to bring about solutions and accelerate their implementation in our projects and throughout the operations of the partners of the Sekoya Club. And of course, we bring in students in a participatory matter with the Eco skills challenge, which is a student challenge that rewards innovative ideas for the modes of construction that are most respectful of the environment, the most sustainable. Third addition to place last May in Paris and 3 awards and the Public's award were granted. There were 8 finalists out of 88 teams. Innovation is also at the heart of our operations. For example, Eiffage Energy System has quite a fleet of drones operated by our own pilots. This is for simplifying and securing our various operations, inspection electric lines, reservoirs, confined spaces, site surveillance, preventive maintenance and so on. Air thermography using a drone that has an infrared camera makes it possible to control heat losses on roofings in urban heating networks and defects in solar panels. All these innovations take -- are involved in preventive maintenance efforts and they help ensure proper maintenance on -- in the field at the right time at the right place. This is key to operational performance. To go one step further in data analysis, Eiffage has struck an alliance with Google Cloud to increase its operational efficiency, thanks to a structured approach of its data and artificial intelligence. Our strategy in this field is aimed at making the most of our huge -- of the oceans of data that we have at our disposal in a secure, sustainable way to serve as many as possible in all our businesses. We have chosen to focus on the design and implementation of use cases such as the scoring of risks when it comes to prevention, providing a generative AI that is private and specific to Eiffage and also an assistance in drafting technical documents. Finally, when it comes to supporting the group's growth, we must remain attractive and tie our people in. We have worked on our employer pledge to highlight what makes us specific, what our hallmark is and what distinguishes us in order to attract the most able talents and to be selective and to bring in the people we need and who are in line with who we are. We launched a new employer brand called the Family Spirit, [indiscernible] to our culture and the sharing of our values. Following this overview of the highlights of the year, let's come back to the key numbers of the half year. Business grew 6.3% with quite a few differences between our business lines. And as expected, organic growth was somewhat shy of what we achieved in 2023. Operating profit and net profit are very similar to H1 2023. The impact of the new tax was nearly fully offset by the improvement of our contracting results, both in terms of profitability and volume. Free cash flow generation nearly amounted to EUR 150 million in spite of the seasonal nature of our businesses. Debt has been stable following the integration of A41 and the growth investments that we carry out both in concessions and in contracting. And finally, our log book grew very significantly just as at the end of 2023 and even fortified over the period, notably in construction and energy systems. All this enables us to confirm the outlook for 2024. Our contracting business will therefore grow, although the organic growth will be less significant than in 2023. Our concession business is also expected to grow in 2024. Contracting results will once again rise, results in concessions will be significantly impacted by the new tax on transport infrastructure and, therefore, the group's attributable profit for 2024 should be in the same order of magnitude as in 2023. As you've understood, above and beyond 2024, we are confident. We believe that the group's ability to continue its growth and to improve its financial and overall performance are here. I'd like to thank you for your attention. And now I'll give the floor to Christian Cassayre, who will give you a detailed explanation of the financials.

Good evening, ladies and gentlemen. Moving on to the financial portion of the show. You can see 6.3% increase. Organic growth on the left is a little bit lower than it was, there are more and more significant differences between our businesses. In concessions, there's A41, in contracting there are the various elements that were mentioned earlier on the right. There are differences between geographies in France, you can see the numbers. And we are now in a specific situation for the residential market in France and, to a lesser extent, road maintenance has been a little bit lackluster. You can see 17.4% as a continuity of previous years, a combination of 8.1% organic growth and a scope impact of 9.6%, 17.7% altogether. Now if you take a look at contracting, the discrepancies I mentioned can be seen blatantly here, 2.5% average organic growth. And you can see a dual standard of growth, and so the average doesn't really speak very well. I'll come back to this when I go through the various business lines. On the right. The highlight is that we now have nearly 40% of contracting, which is international. It was a little over 35% last year, and it was only 30% in 2021. And of course, there was acceleration in Europe, in line with our strategic road map. Our operating profit is very similar to that of 2023 in spite of the impact of EUR 60 million you can see here. And in the first half, there was a drop, 16% profit in contracting. In concessions, there -- of course, there's some new tax that has an impact, 3% is the profit in the holding, the revolt is more volatile. There are noncash movements. There are 2 things I need to mention here. First, since last year, we have a noncash impact in our group savings plan. And second item is that this is higher than in 2023. And in 2023, we had our provision that was called back, nonrecurring. Now if you take a look at the details here in construction, the setback in France is minus 13.5%. Although the month in the market of new dwellings is not new. They're -- there are high comparatives here. H1 was up in 2023 because of programs that were still going on. And for the full year, it's down. In Europe, too, sales were down in the 3 countries where we have operations for the same reason, but you see that the margin is still doing pretty well, 3.4%. There are 2 explanations for that. First of all, we have a very selective cherry-picking policy. And secondly, margins are still quite robust, 8% in spite of the fact that the business volume is lower. Property development has just generated EUR 24 million in operating profit, compared with EUR 33 million in 2023 and EUR 59 million in the full year. This lesser contribution has been offset by stronger performance in contracting. And finally, the backlog as at 30th of June, on the right here, it takes into account the service industry project that we were awarded by the French home office, although we didn't really make a big media splash about that for reasons you understand. In our in our spirit Family program, we launched a competition, and I have a few pictures to show you here within Eiffage Construction. And here in the [indiscernible] agency, this is an engineering school construction project. In infrastructure, the business in France remained buoyant, plus 3.8% in spite of volume that shrank with the Grand Paris Express, a mere EUR 134 million out of EUR 180 million last year, and it used to be EUR 300 million before that. But this was offset by the ramp-up of the Toulouse Metro and there were other businesses. And so engineering, those rose 13% in France, whereas roadworks dipped 2.4% because in general, maintenance dipped, although the momentum remains strong regarding urban mobility projects, a few examples were given earlier. And now International Civil Engineering. The growth is 12% driven by large infrastructure projects, LGB, HS2, highways in Norway and Germany as well. A strong increase in international metal works, plus 28%. As you may recall, we increased our production capacity last year. And of course, the offshore wind energy market is rising, and we're a part of that. The growth remains stronger in the rest of the division. It's a specialty business. It's less seasonal. And the operating margin dipped to minus 0.3%. But of course, this isn't really representative because it's seasonal. So this is in line 15 now of the [ Compiègne ]. And in roadworks, we're in north here [indiscernible] the main square in the city of [indiscernible]. The business of Eiffage Energy System remained very dynamic on all the markets. Plus 7.7% in France, 6.1% of that is organic growth, essentially driven by a number of large project data centers, the Grand Paris Express and we moved on to the actual work after a lot of engineering work, international. European growth was 41%, and minus 8.5% outside Europe, where sales were up 37.4% to 41% rise in Europe is, of course, driven by the integration of Salvia and Van deng Pol, but the organic growth in the area remains significant 12% for the half year. Operating margin is once again on the rise, 30 basis points to 4.6%, owing to market dynamics and already mentioned. And we are capitalizing on that given our exposure to these acquisitions that we're carrying out. And of course, our teams have constantly increased added value in our propositions. Another highlight of the half year is an EUR 8 billion jump in our [ order ] book. And this, of course, drives us full speed ahead into 2025. So the Mont-Saint-Michel here on the left, you can see our teams here and the people on the right are in Occitanie, in South West of France. Now in concessions, since last December, we've been showing you this slide here in the next 2 as well to highlight our main assets that are consolidated. On the left, you have the list of the assets, the end of the of the concession and how much we have. And on the graph on the bottom, you can see the ramp-up of the 3 blocks, highways, airports and other assets held in PPPs or concessions. So in APRR, things were a little bit difficult. But A79 has been rising slightly above expectations as far as traffic grows. The drop in EBITDA essentially due to the new tax on highways. It also has an impact on result [indiscernible] recurring operated. The last 2 aggregates plus the recurring of this on net profit are -- it must be seen in light of the amortization, which I spoke about plus EUR 17 million in the half year due to the amortization of our investments. And of course, you must take all this into account moving forward. Regarding other APRR concessions. Here, you have EBITDA generation and margin. The margin difference between the concessions is due to the fact that we operate and integrate certain services. On the right here, you have the contribution of the concessions in terms of [ profiling ] curve operations. All this is consolidated, excluding Getlink. And of course, Family Spirit again. Here, you have a port of Toulouse. Now in our portfolio. This is the Pierre Mauroy that was mentioned. And on the right, of course, you can recognize the Viaduc. So Getlink is now on an equity basis. On the right here, you have the key numbers published by Getlink, sales and net profit because we do integrate net profit into our accounts. Getlink's fluctuation in the first half was EUR 35 million for Eiffage, broken down to 3 amounts. The share of [ in the half ] EUR 35 million of the rest of the 2023 profit because we published our accounts before Getlink, EUR 6 million and EUR 6 million in goodwill amortization. On the first half of 2023, we took into the account EUR 7 million of the share of our result because we only consolidate Getlink for 2 months, a noncash profit amounting to EUR 29 million, here you are. So much for the operational business, now consolidated results. Here, you have a line for other nonrecurring profit and losses, EUR 18 million, it's down EUR 10 million in 2023, there was an exceptional item there. Now net debt is up a mere EUR 6 million, whereas -- that was EUR 10.5 million for the integration and interest, of course. So you can see the interest here. The performance is quite good given the high interest rates on the market here. And inflation expectation business duration, another reason is that treasury compensation has been better than expected. We had EUR 3 billion in active treasury, including EUR 1.2 billion with interest. And that adds up to the figures you can see here. Other profit and losses in interest, it's offering noncash in 2023, there were EUR 29 million of the revaluation of Getlink, which I just mentioned. And finally, tax, EUR 235 million. And the effective tax rate was nearly 29% above the usual standard because the tax on highways cannot be deducted and net attributable there, EUR 382 million very near the level of last year. Now to the balance sheet. Here, you can see the net debt EBITDA is up EUR 117 million. We now can make the difference with the dividend flow that we get from our equity companies. EUR 66 million from Getlink. The seasonal variation of working capital requirement is more significant this year, EUR 672 million after 4 years while debt working capital requirement resource was EUR 1.1 billion in treasury. The interest and tax paid is above that of last year, in particular, regarding tax, and therefore, the operating cash flow is EUR 551 million, as shown in green here, down EUR 170 million. As you can see, investments are under control. They are stable in contracting in spite of the rise in business. They are limited in concessions for the half year given the phasing of certain operations. And I think that has nothing to do with the full year numbers. And on the whole, we have an investment flow of roughly EUR 400 million and free cash flow is EUR 148 million down from 2023 given to [indiscernible] highway tax. But the good news is that since last year, operations generated cash flow in H1, it's positive in spite of the seasonal nature of contracting. This was not the case in the past. It was negative in the first half as we recall. And now you have the history shown here, and now it's positive in the first half as well. External growth generated EUR 266 million in cash out for the acquisition of our stock. And now we have a 100% stake in the company that we used to own partly only, EUR 400 million in dividend paid out to our shareholder. And debt is EUR 10.6 billion stable. It's broken down as follows: nonrecourse debt for concession in black here, limited rise here, EUR 200 million. It's limited because you need to remember that we integrated debt of Adelac, EUR 636 million. The net available treasury for the holding is near 0. It was EUR 193 million last year. The group's net debt is stable over a period of 12 months, EUR 10.6 billion, as is the net treasury of contracting and the holding company, which is stable around 0 because we've reinvested over the past 12 months. We carried out quite a few external acquisitions. We designed in H2 '23, and we took a larger stake in Getlink and we increased our treasury stock by 1%. Now the final chart here that Benoit spoke about the green light, notably on the right here. Here, you have the details per business line. And you can see contracting with the step here between 2023 and 2024, that was commented upon at great length. There your are. So much for this part. I'd like to thank you for your attention. And now we'll be very happy to entertain your questions.

I have a few questions. Number one, on the ruling by the constitutional court in September, if this ruling goes against you, what are your options? What can you do about it? What are the areas, scenarios to challenge that tax on infrastructure? You need to find a solution, don't you? And on property development, you said that you are halfway through year cycle or at least you've had as it were a rock bottom. Is that to say that you will look -- you're looking to sort of a better position in 2025? I mean, just what's your feeling on that? Regarding construction, the construction business, Eiffage Construction not including property development. How do you distinguish between residential property and commercial property, nonresidential property? What's the breakdown? And then you referred to the A412 motorway. Is there any sort of political risk that this project might be postponed?

Right. Regarding question number one in the constitutional court. Well, we've communicated on that before there are 2 possible remedies. But one goes after the other. We have -- I mean -- these are 2 different approaches. The first one, well, is to seek remedy from the Constitutional Court. There was one prerequisite. The Council of State considered that it was fair to ask the Constitutional Court, whether this question -- matter was consistent with whether this tax was consistent with the French constitution. If we have a negative ruling, then we are back to contract legislation. In other words, the contractor do regulations, the number of provisions regarding tax issues that was considered, in fact, when we pulled out of the 2015 crisis. So this will take us to administrative court, which will take time. because whoever wins, there will be an appeal. And so that process will be very long because the Administrative Court can be appealed all the way out to the Council of State again. So that might take some time. Olivier? Yes, maybe -- so this way, and people will know you better.

Yes. Good afternoon, everyone. Regarding -- I'm not sure who asked the question. On property development, this -- well, this business is slightly down. Regarding new housing units, new housing, this market is under real pressure. And in fact, there's very little visibility. Now there are a few indicators nonetheless, the reservation rates. Well, that is looking -- well, H1 2024 is somewhat better than H1 2023. So we may have as it reach to sort of the breakeven point. Although how long will we stay there, we don't know. It's sort of a balancing act, and we don't know how long we'll be able to maintain that position or whether we will, in fact, get over the hurdle or whether we might fall back. But the residential property, that business has always been doing well enough, particularly thanks to the Nové contract. Remember Nové, for the construction part of the contract, that business is significant. We're talking about EUR 1.1 billion in construction work. And so this is residential property alone. But this is the right, this is a mix between new housing and rehabilitated buildings. But that is only party to be found in our backlog because the order book takes in these new orders as they are authorized by the local authorities and such like. Nonetheless, this gives us some visibility for future years.

Yes, the reservation numbers in 2021. We're looking at 2,200, 1,500 in 2023, 500 in the following year in 2024. We're up to 800. So is that to say that we are in an upward trend, but we're a long way from the figures of 4 years ago. Yes, basically, the market halved in a matter of 3 years. And of course, when residential pick up again, you still have to wait for 2 years before you generate actual revenue, and this applies both to Eiffage Immobilier and Eiffage Construction. So there will be -- it will take some time for the effects to be felt. But for both residential and commercial property, that Nové contract, of course, is an outlier from the market. That's one thing. The -- in traditional markets, we had this sort of division between residential and nonresidential or commercial property. Now the real distinction is between renovated buildings or rehabilitate buildings and new buildings. The renovated part of the building is growing and will keep growing, and that the business is very dynamic. And in fact, Nové is a case in point because there are quite a few parts of that contract that involved the rehabilitation of buildings. We're looking there at large projects but they're involving comprehensive sort of holistic approaches, but highly technical solutions as well, which means that you need to have a significant design and engineering capacities to be able to take on such contracts because the energy, renovation projects are quite significant, and we are well positioned to take them on. Regarding the A412 freeway, right. Yes. On A412, we have been granted the contract, but it is -- we are the preferred bidder, but that's one thing. We still need authorization from the French ART and the French Council of State. So that has been passed. But of course, the contract itself has yet to be signed. And for that to happen, we need to have government officials, minister in charge. And at this point, as you may know, we haven't got one. Yes. And well, local officials have been providing full support for the project. So at least as far as local authorities are concerned, we have a go ahead. But again, as I said, we need a government minister to sign the document, and we haven't got that.

I'm from JPMorgan. I have several questions. Number one -- and you can answer them in one after the other. What is your view -- what's your -- how do you see the constitutional court? How do you see that happen? I mean do you think they will rule in your favor or not? What do you think?

Once again -- I'm sorry I haven't a clue. I have no idea at all. One thing, I can tell you that all constitutional lawyers have been working on this issue. There have been hearings. And now it is in the hands of the Council itself, and they will have to rule on the matter. It is a highly technical matter, and at this point, I would be at a loss to give you any idea or one way or the other.

Regarding profit margins on the energy rehabilitation business, you're up 30 basis points. You were at 5.4% last year. Can you -- we look forward to like a 6% profit margin this year? I mean, if you add 30 basis...

Well, I wouldn't have dared go that far. But maybe [ Ludovic ] can...

Good evening. Look, of course, we are growing year-on-year. Last year, our profit margin was 5.4%, and we have every reason to hope that we'll do even better this year. I can't tell you much more than that. But of course, we are doing our utmost to reach a 6% target eventually. I mean sorry, that's definitely one of our targets.

Well, thank you. Yes. Well, I mean, 6% in 2024, I'm afraid not.