HOCHTIEF Aktiengesellschaft (HOT) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to the HOCHTIEF Full Year 2024 Results Conference Call. I'm Moritz, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's a pleasure to hand over to Mike Pinkney. Please go ahead, sir.

Thanks, operator. Good afternoon to everyone, and thank you for joining this HOCHTIEF 2024 results call. I'm Mike Pinkney, Head of Capital Markets Strategy, and I'm here with our CEO, Juan Santamaria; and our CFO, Peter Sassenfeld; as well as our Head of IR, Tobias Loskamp, and other colleagues from the senior management team of HOCHTIEF. We're looking forward to taking your questions. But to kick off, our CEO will run us through the details of this strong set of numbers and provide you with an update on our group strategy. Juan, all yours.

Thank you, Mike and team, and welcome to everyone joining us for this results call. Our growth strategy has delivered a very successful 2024. HOCHTIEF will drive further growth in 2025 and beyond. We have consolidated leading positions in our strategic markets, where growth is being driven by an unprecedented ramp-up in infrastructure investments by our public and private clients. We're deploying our geographic footprint to access this growth in all our regions, and we're expanding our presence in the value chains of these markets to enhance growth. This growth trajectory is supported by a solid balance sheet, a strong order book and a strongly cash generative. Turning to the numbers. The group delivered substantially higher sales and profits backed by another strong performance in cash flow generation. Group sales increased by 20% to EUR 33.3 billion in nominal terms, accompanied by solid operating margins. Adjusting for the impact of acquisitions and divestments, sales growth was over 10% on a comparable basis. HOCHTIEF's operational net profit rose by 13% to EUR 625 million in 2024, exceeding the top end of the guidance range of EUR 560 million to EUR 610 million we provided to you at the beginning of the year. Nominal net profit of EUR 776 million included a net EUR 147 million one-off gain at our Australian company, CIMIC and campus with EUR 523 million reported for '23. The quality of our profit performance is underlined by HOCHTIEF's outstanding cash generation during the year. Cash flow from operating activities in 2024 was over EUR 600 million higher year-on-year at EUR 2.1 billion, an increase of EUR 100 million year-on-year on a comparable basis and reflecting a high and sustained level of cash conversion. HOCHTIEF ended the year with a slightly net debt position of EUR 120 million, adjusting for the impact of strategic investments carried out in 2024, which I will describe later. We will have a net cash position of EUR 1.6 billion, even after taking into account the EUR 331 million dividend paid out to shareholders in July 2024. The group's order book ended the year at EUR 67.6 billion and is up by EUR 7.8 billion or 13% on a comparable basis versus December '23. As a consequence of our strategy to further improve the group's risk profile, low-risk contracts, which incorporate enhanced risk-sharing mechanisms now account for well over 85% of our order book. As you will be aware, this proportion has risen substantially in recent years. The ongoing increase in our backlog reflects the strong growth recorded in new orders, which rose by 14% to EUR 41.8 billion equivalent to 1.2x work done during 2024. Around 50% of the new work we secured during the year relates to our growth markets. Let me reference the selection of some of our project announcements made during 2024 in these growth markets. At the end of the year, Turner along with 2 partners, was awarded a contract with Meta to build a mega data center campus worth more than USD 10 billion in Louisiana, one of the largest projects ever announced in the sector. Pacific Partnerships acquired the development rights for the 700-megawatt Cobbora Solar Farm and associated large-scale battery energy storage systems in New South wells, which will be one of the largest in Australia. This was awarded an important 3-year full-service mining contract in Ontario, which will help Canada's nickel and copper industry to provide critical metals that are vital to North America's economy. In Europe, HOCHTIEF won a contract for semiconductor-related construction facility using clean room technology. And in Asia Pacific, Leighton Asia secured a EUR 2.6 billion hospital expansion project in Hong Kong. HOCHTIEF has also delivered important projects in our key sectors doing transport infrastructure, education, airports, sports stadiums and defense, where demand continues to show strong structural growth driven by megatrends and other related factors such as increasing urbanization. In Europe, for example, the EUR 1 billion Dutch A15 PP (sic) [ PPP ] highway project where HOCHTIEF consortium is preferred bidder got the go-ahead from local authorities. In the U.K., HOCHTIEF was awarded a multimillion euro PPP contract to design, build, finance and operate a new student village for Staffordshire University as well as 12-year transport infrastructure maintenance contract in Scotland worth at least EUR 190 million. In the U.S., the Turner joint venture is leading the USD 2.6 billion transformation at the San Francisco International Airport. Turner also maintains a leading position in sports stadiums and during the third quarter, celebrated the opening of the USD 2 billion Intuit Dome with its joint venture partner and the Los Angeles Clippers. In Defense, CPB was awarded a AUD 370 million Royal Australian Air Force Base project in Queensland with works, including the upgrade or rebuild of infrastructure and facilities. Elsewhere, Abertis won an international tender in Chile for the expansion of the strategic transport link Santiago-Los Vilos with a 30-year concession period. And now let me take a moment to outline our performance at the segment level. In terms of order growth and indeed other metrics, Turner had a standout performance. On revenue growth of 19% to EUR 19.3 billion, operational PBT was 37% higher at EUR 570 million and well above the top end of the guidance we had provided of EUR 510 million. This outstanding rise in profits was partly a consequence of the 40 basis point margin increase at the PBT level to 3%, driven by Turner's successful strategy of focusing on advanced technology projects, in particular, data centers. And I would highlight that the net profit contribution of EUR 414 million, a 41% increase year-on-year, represented 50% of HOCHTIEF's group operational net profit. Turner's strategy is delivering very strong growth in new orders, resulting in a 30% increase in the company's backlog to a record EUR 32 billion. That's a EUR 7.3 billion jump during 2024. As a consequence, we anticipate Turner will continue its strong growth momentum driven by, firstly, its strong position in advanced tech, including the rapidly expanding data center market boosted by Dornan in Europe. Secondly, further margin progression as the share of advanced tech projects steadily increases and aided by SourceBlue supply chain services offering. And thirdly, the structural long-term growth in several of its key markets such as health care, education, airports and sports stadiums. The growth strategy at Turner is delivering strong growth. Our guidance of EUR 660 million to EUR 750 million operational PBT for Turner in 2025 points to an increase of between 16% and 32%. Moving on to CIMIC. I would highlight the solid underlying revenue with a strong growth in strategic market segments, particularly across the data center, social infrastructure and energy transition markets. Our integrated solutions company delivered operational PBT of EUR 450 million, up 6% on a comparable basis towards the top end of the guidance range of EUR 460 million. Operational NPAT was up by 8% at EUR 263 million with nominal NPAT of EUR 410 million, including a net one-off gain of EUR 147 million related to Thiess acquisition. CIMIC ended the year with a robust order backlog of EUR 24 billion, up 3% year-on-year FX adjusted. We expect further growth in the business in 2025 with an operational PBT guidance for CIMIC of EUR 480 million to EUR 510 million. At our Engineering & Construction segment, sales increased by 10% year-on-year to EUR 3.6 billion. Operational PBT showed a 7% increase to EUR 88 million, in line with the guidance range for the year with stable margins. The E&C order backlog of EUR 11.6 billion was up a further 4% year-on-year after an exceptional 2023 when the order book jumped by 20%. 2024 new orders were solid at EUR 4.4 billion, around 1x the work done. Our E&C guidance range for operational PBT in 2025 of EUR 85 million to EUR 95 million implies a strong growth of up to 24% on a comparable basis. Looking at Abertis, the toll road company continues to deliver on its growth strategy of investing in assets to extend its portfolio duration. Operating revenues rose 10% to over EUR 6 billion and EBITDA also 10% higher at EUR 4.3 billion. Operational net profit pre-PPA was around EUR 800 million, a 4% increase with a nominal net profit figure incorporating the impact of the early termination of the Texas toll road. The operational result of EUR 81 million was in line with expectations. As a consequence of the solid cash flow performance, we expect Abertis to distribute a total dividend of EUR 600 million in the second quarter of 2025, in line with the previous year. And we anticipate Abertis will deliver a similar operational result in 2025 to the EUR 81 million of 2024. I would like now to provide you with an update on our strategy in the context of an infrastructure sector, which is undergoing an unprecedented and multiyear transformation driven by digitalization, demographics, decarbonization and deglobalization. HOCHTIEF has positioned itself as a leading advanced tech infrastructure and services solutions provider to meet the strongly rising demand, not just from a construction perspective, but also as an equity investor and operator. This is consistent with our group objective to deliver an attractive level of shareholder remuneration and create long-term value by first, generating cash back profits while maintaining a low risk profile; second, further expanding our presence in strategic growth markets; and thirdly, by accelerating our equity investment in greenfield infrastructure projects accompanied by selective M&A. The efficient allocation of capital plays a key role in the strategic development of our company in terms of transformational M&A, bolt-on acquisitions, the deployment of equity capital for next-generation infrastructure and PPP investments. During the year, HOCHTIEF has executed several important M&A transactions, which support our strategic growth ambitions and further consolidate our strong competitive positions in specific market segments. Turner announced the EUR 400 million strategic acquisition of Dornan Engineering, which was closed in January '25. This rapidly growing advanced tech engineering business headquartered in Ireland had an order book of EUR 1.6 billion at the end of last year. The Dornan acquisition is a major milestone which will enable the group to accelerate its European expansion strategy where it has currently identified potential project pipeline of over EUR 20 billion. In July, HOCHTIEF and Dragados agreed to integrate their North American civil engineering businesses to create the second largest player in the region. The combined resources will support further growth in a rapidly expanding North American civil works market. This value-accretive transaction, which was closed in January '25, results in HOCHTIEF holding a 38.2% equity consolidated stake in the new business. During the second quarter of '24, another important step in our group strategy was taken when CIMIC announced it had entered into an agreement to acquire an additional 10% equity interest in Thiess. The acquisition for a purchase price of EUR 195 million increased the group's ownership of the natural resources companies to 60%. And at the beginning of the year, the shareholders of Abertis contributed EUR 1.3 billion in equity to support the company's growth strategy with HOCHTIEF subscribing its EUR 260 million share for its 20% stake. Let me give you more color on our leading position in the data center market, where strong growth is expected to be sustained for several years driven by the rapid expansion of cloud computing and artificial intelligence. We have evolved HOCHTIEF's strategic position in the sector over several years. Beginning with small facilities, we have developed our experience and capabilities in North America to enable us to deliver data center projects for the leading global hyperscalers, such as the Louisiana project I mentioned earlier. In addition, we have started to deploy equity. Looking forward, overall data center capacity predicted to show double-digit growth through to 2030 and hyperscaler capacity is expected to double in the same time frame. So demand from these clients will likely grow faster than the overall market. HOCHTIEF is leveraging its global digital infrastructure capabilities to identify and harness the strategic levers that enable data centers to be deployed at pace. At the same time, we're leveraging this know-how, our geographic footprint and our strong client relationships to enable us to address the strong demand growth in the Asia Pacific region and Europe. In Asia Pacific, we have been awarded several projects during 2024, worth in total EUR 1.3 billion, including data center contracts in Malaysia, India, Melbourne. And we're delivering or completing work in Hong Kong, Indonesia, Macau and the Philippines. In Europe, Turner is assessing an addressable pipeline of advanced tech projects worth over EUR 20 billion, mainly in data centers, which complements the strategic acquisition of Dornan and lays the foundation for the company's expansion in the European market. In North America, Turner continues to grow its leading position with its data center order backlog having almost doubled year-on-year to around USD 7 billion. And I would highlight that this figure includes only a negligible contribution from the Louisiana project win announced in December. As a result, HOCHTIEF overall data center order backlog at the end of '24 stood at around EUR 8 billion, over 13% of the group total, more than double the level of '22 and is set to grow significantly in the future with additional momentum coming from the Dornan acquisition. Furthermore, we're now investing substantial amounts of equity in selected data center projects, thus providing HOCHTIEF an additional opportunity to create significant value in this sector going forward. In Australia, we're leveraging the group's capability and leadership position. And in 2024, we acquired a site to develop a data center with 200 megawatts capacity. And in Germany, we have expanded the framework agreement with our partner to 15 sustainable edge data centers. The first one will become operational this summer. At the same time, further potential expansion in Europe are under discussion. This strategic shift from building to also owning and operating data centers is consistent with the group's strong track record in PPPs. Overall, at the end of '24, we had committed equity investments of EUR 800 million, of which about EUR 400 million are in strategic growth markets, including data centers, renewables, battery energy storage systems, electric vehicle, charging networks and critical metals. Looking further forward, HOCHTIEF is leveraging its project delivery track record, engineering experience and market presence to position itself for additional potential growth opportunities which are emerging globally. Specifically, we've been developing our technical and engineering know-how in sectors, which are critical for the global energy transition into lithium, EV charging and clean energies as well as in the other areas such as semiconductors. These optionalities enable HOCHTIEF to potentially benefit from additional significant longer-term growth opportunities. We continue to focus on creating sustainable value for all stakeholders and HOCHTIEF remains focused on ESG. In accordance with the Sustainability Plan 2025, HOCHTIEF aims to be net-zero by 2045. And accordingly, we have defined additional near-term reduction targets through 2030. Shareholder remuneration remains a priority for the group. As a consequence of HOCHTIEF's strong profit increase during 2024 and taking into account the solid growth momentum, the proposed dividend for '24 is EUR 5.23 per share. This represents an outstanding 19% increase year-on-year compared with EUR 4.4 per share dividend for '23 and is equivalent to a 65% payout on the operational net profit for the year. So let me wrap up. HOCHTIEF's 2024 results show an excellent performance with a 13% increase in operational net profit, exceeding guidance and backed by strong cash conversion. Our record year-end order book of almost EUR 68 billion shows a comparable 13% rise in the last 12 months, with particularly significant increases in areas, including data centers and health care projects, setting up the group for another strong year. And we're also delivering on the strategic shift towards investing equity in our growth markets and thus expanding our opportunities to create value in markets where we have leading positions. HOCHTIEF's growth trajectory is a consequence of consistent effort and resources applied in a consistent direction, underpinned by our increasing adoption and development of digital and AI tools. We're harnessing our existing experience and capabilities across the group's activities and geographies, incorporating additional specialized engineering and systems know-how and leveraging our competitive strength. And we confidently look forward to sustained growth in the coming years. Our positive momentum is set to continue in 2025. We expect to achieve an operational net profit of between EUR 680 million to EUR 730 million, which represents an increase of up to 17% compared with last year. Thanks, everyone, for listening and happy now to take questions.

We're ready for questions, operator. Thank you.

[Operator Instructions] And the first question comes from Graham Hunt from Jefferies.

I've got three, if that's okay. First one is just on balance sheet and your appetite for investments. Should we expect all kind of inorganic investment to go into developing new concession-type assets like data centers? Or would you -- could you do further bolt-on M&A like Dornan to add in capabilities where you need them? Do you still need -- or do you still see capacity there? That's question one. Question two, is there any more color you can give us on SourceBlue financials within Turner? How much of that business is external now? And anything on profitability would be helpful. And then again, on Turner, just wanted to come back on longer-term guidance. Apologies if I missed this, but are we still -- is the guidance for 2026, still the same or still intact there on Turner margins?

Thank you. So let me start with the balance sheet. Well, first of all, let me recap on -- a little bit on our firepower where we are right now. So in 2024, our net operating cash flow has been $1.5 billion, and this was before the EUR 331 million dividend payout to HOCHTIEF shareholders. So now where do we want to use that firepower? Certainly, for assets, whether that's traditional PPPs or data centers or other opportunities as a result of our diversification into new growth markets. So for sure, we're going to find opportunities across those sectors. And certainly, data centers is an important one for us. At this stage, we haven't identified any additional bolt-on acquisitions, but we're not rejecting it. I mean if there's opportunities that will allow us to expand our capabilities, we will certainly take them, right? So that's another one that we will be pursuing. But at this stage, there's nothing that comes to our mind. On the second point of SourceBlue, the 2024 revenues of SourceBlue came up to USD 1.27 billion, which is like a 56% year-on-year improvement. And the PBT margin is close to around 8%. And there's like EUR 1.8 billion backlog going into 2025. And that's putting aside the financials is very strategic because it's allowing us to get into the logistics business that is helping us, our clients and reinforcing our value proposition in -- especially in a lot of the growth areas. And when it comes to Turner 2025, in our Capital Markets Day, we expected by 2026, Turner to reach a 3.5% PBT margin. And we are comfortable that we are in the right path, if not faster than what we thought.

And the next question comes from Luis Prieto from Kepler Cheuvreux.

I have three, if I could. The first one is, what do you think are the implications for Turner or potentially disruptive technologies, such as DeepSeek? How does that impact pipelines and therefore, your business? The second question is, if you could please navigate us through the differences between the data center equity investment approach at HOCHTIEF and then at ACS Iridium levels? Are they any different? Are they just geographically different, but the same in essence? And the third one is, if you could please shed light on the moving parts of working capital performance. And I was particularly interested in factoring dynamic.

Thank you, Luis. So let me start with DeepSeek and the potential implications. So let me go one step back first. So recently, and by recently, I mean, over the last few days, the U.S. hyperscalers have announced plans to spend over USD 320 billion in 2025. So this is strongly up from 2024 that they spent $246 billion. And this is double the level of 2023. With this target announcement, that's adding even additional long-term momentum, right? On the other side, Europe seems to be accelerating its own investment because they are planning to develop its own AI infrastructure. And also European Union is launching its invest AI initiative, mobilizing EUR 200 billion. And the U.K. Prime Minister, it's also setting out a blueprint to turbocharge AI. So certainly, demand -- there's a lot of demand growth and very positive. Now then DeepSeek, what can we say about DeepSeek? Well, it certainly seems to be introducing efficiencies and everyone is right now looking into DeepSeek. But any new player, and this is from our perspective as digital infrastructure providers, any new player reinforces the importance of scalable and adaptable infrastructure, which is the kind of approach that we are pursuing. So we believe that the rapid pace of innovation in AI means that new models will continue to evolve and improve, which means that there will be an increase in demand for AI infrastructure. And that's our view. And that's what we're seeing so far, and that's consistent with the current announcements of the big hyperscalers and the new players. Now let's talk about our data center strategy and the differences between HOCHTIEF and ACS. So what we have initiated 2 different strategies that will converge, one at the level of HOCHTIEF, which is the edge data center strategy. And basically, what we're doing with this strategy is to launch and deploy edge data centers from 2 megawatts to 9 megawatts in urban environments to make sure that we reduce latency, and this is for AI processing. And for clients that want to have their own cloud services specifically for themselves, right, in closed networks. As part of this strategy, we are not only delivering the new infrastructure and owning infrastructure, but we are providing cloud services, cybersecurity services and potentially AI applications. So we're growing a big ecosystem around these ones. And if everything goes in the right direction, we're going to deploy a lot of them throughout Europe, the U.S. and potentially Australia. When it comes -- and I'm not here to speak about ACS, but when it comes to ACS, they decided to build larger data centers, to own land, to build larger data centers and to develop them for big hyperscalers with a lease, right? Potentially some colocation, but mainly leases to hyperscalers. So this is the way we started. What's going to happen is that both are going to converge, right? And HOCHTIEF will develop because they have already identified land in the places where HOCHTIEF is present, like in Germany, like in Europe, et cetera, and have identified or the one in CIMIC that I mentioned, for example, that has already been awarded. And HOCHTIEF is also going to use part of the ACS ecosystem to deploy the [indiscernible]. So we are growing significantly. And as I said last year, at some point, most likely second half of this year, we will provide a special Capital Markets Day on this topic because I think that it's relevant and it is growing significantly inside our group. And then on the working capital performance, we had -- let me start -- I mean, talking about the working capital inflow of this year. We had EUR 300 million. Last year, there was an outflow of EUR 40 million. And when it comes to factoring, there has been a EUR 270 million factoring this year, and that's basically for 2 reasons. One is the increase in revenues; and second, the consolidation of Thiess. So that's including the factoring that was coming from Thiess.

Juan, it's Luis again, sorry. Just to clarify, regarding the 2 strategies. So the -- what they're doing in urban environments with smaller data centers, are they buying land and developing from scratch? Or what's the difference between that and what ACS will be doing in terms of buying land more aggressively and then the lease, et cetera, et cetera...

No. From that point of view, both strategies are the same. We acquired the land. We changed the use of the land. We invest in the energy and the land, fiber optic. We make sure that we get all the permits and through -- including environmental and governmental. And once we have everything ready to build, we make sure that, a, we get a lease or a colocation, et cetera, et cetera. The difference is not in the approach to the land or owning the land. The difference is more the type of data center. So, so far, ACS was focusing on the big ones for AI training purposes, mainly or data center storage, while HOCHTIEF was focusing on AI processing, right? But again, both strategies are going to converge.

Okay. And then -- and also the size is different, but that will eventually converge. And the geographies, as you suggested that they're pretty much the same on either side. It's Europe, U.S. I assume HOCHTIEF also in Asia.

Yes.

And next question comes from Dario Maglione from BNP Paribas.

Congratulations for the good results. I have 4 questions. So the first one is on Turner. The guidance for 2025 operating PBT up between, I think, 16% and 32% year-on-year, a big range. What will we need to see to hit the top end of the guidance? Is it more revenue growth or margin growth? Question number 2, you mentioned that HOCHTIEF will also be a developer and owner of data centers like ACS. Can you maybe elaborate on the risks of these kind of projects? And how the company will manage them? Third question, whether you can share with us the current ownership of ACS in HOCHTIEF shares. So whether ACS has been buying shares in Q4? And the last question on Abertis and specifically, the French concession Sanef, whether there are discussions with the government on what happened next once a concession expires in 2031?

Thank you, Dario. So let me start with Turner. For the guidance 2025, I mean, 2 things. It's growth on one hand and increasing margins on the other. So both, and we're quite confident that they will continue this path. And by the way, Dornan also has an influence on that, obviously. Second, risks around the ownership. The big thing about -- and this is why, in my opinion, there's a little bit of barriers of entry in the data center space. Because in our case, it's quite natural for us because of our geographical presence and because of our services and because of our -- the work we do. It's quite natural for us to take the land, develop land, put the energy, go through the permits and environment. And we do that in conjunction with other work we do in the surroundings of our land plots, right? At the end of the day, we have presence in 47 states of the U.S., in all the countries in Europe, in all the countries of Asia Pacific from India to Hong Kong, in Australia, New Zealand, et cetera, in South America. And we do have huge presence very granular and with a lot of intensive labor. So it's quite organic. It's quite natural for us. It would -- I mean, probably for other companies, they would require a level of investment that, in our case, is not there. It's just part of our day-to-day business. The second thing is unless there's a point in which you need to start developing the land and you can only develop the land if you understand the requirements of what's coming in energy and what's coming on the future design and engineering of the data center. So unless you know because you are doing those projects for the big platforms and for the big hyperscalers, it's quite difficult to take the risk because hyperscalers only start conversations when you are very, very close to begin the construction and delivery of the data center itself. If you go to a hyperscaler to say that you are thinking a land plot, they won't talk to you. They will talk to you if you are 12 months away from being in operations or 18 months the latest depending on the size. And this is something very difficult for anyone that is not in the industry, and it's not building as we have 6 gigawatts in the last 3 years, which is significant with the latest technology. What happens -- so that's an entry -- a barrier of entry. Now what happens? What's the risk, more specific into your question. What's the risk that we acquire land that typically is very inexpensive, and we have spent some time developing. And at the end of the day, we do not find a suitable tenant. That's all. But we're not talking about big risk. What we're not going to do is to spend the hundreds of millions or billions in investing without making sure that we do have a tenant and we do have a big business plan that is bankable, right? That's the part that we don't get. And then the next question was ACS in HOCHTIEF. I think the last figure we published was 77.4% in the last 9 months. Adjusting for treasury shares, that was 80%. I do not have any other figure with me right now. And then with Sanef. We are not having any specific discussion with government authorities. We can only speculate that the base case will be that they will recover the concessions and repeat them with the same or different structure, but that's the only thing we can speculate at this stage and it's just a possibility.

Then the next question comes from Marcin Wojtal from Bank of America.

The first one, could you update us on the pipeline for Abertis? What type of projects they are monitoring at the moment? It has gone a bit more quiet when it comes to Abertis M&A recently. And could you just confirm that HOCHTIEF has the balance sheet capacity and the willingness to support Abertis, if required? Question number two, could you say whether HOCHTIEF has any appetite to potentially get involved in potential projects related to reconstruction of Ukraine should the constant come to an end? And also related to that, could you just remind us -- could you remind us what is your involvement in defense sector projects in the U.S., in Australia and also in Europe? And maybe my last question, could we get an update on the merger of Flatiron and Dragados? Do you see these synergies of USD 30 million to USD 40 million already realized in 2025? And also how much net cash is in Flatiron right now? So therefore, how much cash will you deconsolidate when you complete the merger?

Okay. So let me start with the pipeline, Abertis. We are looking in Abertis at opportunities. We were not able to disclose them at the moment, but we're looking at opportunities. And hopefully, we will be able to materialize them soon. And allow me to give an update probably in the next quarter about this. Second, the willingness to support Abertis, yes, is there absolutely as long as the opportunities are good, as long as obviously, they get the right returns. And I do think that there's some momentum on that potentially. And I hope that 2025 becomes an important year for Abertis. Three, HOCHTIEF, the reconstruction in Ukraine, we've been following that for some time right now. Obviously, there's a change in what's going on in Ukraine that we need to analyze and we are looking at carefully because of the implications. But in principle, if everything is normal and of course, if everything ends up in the right way, we are keen on getting involved. Defense, we're very active, as you know, in defense. We are -- in Australia, I think our latest backlog in Aussie dollars was above the AUD 8 billion in defense. From army bases to training facilities to the fuel management and logistics for the Army, but also in the U.S., where we've been quite active in the past, and we remain active with the U.S. Corps of Engineers and the Army. We won -- I think that one of the first investments in the Army base in Poland, and we're looking at the Eastern countries as well where we believe that there is a lot of investments. And we are confident that in Germany, there's a lot of investment coming as well. So we are very -- we're going to be very active in that space. Flatiron and Dragados, EUR 32 million to EUR 40 million, we continue targeting that as a first phase. Probably I would say that, that will come more in 2026. We will see second half -- I mean, some of that coming. We will see part of that in '25, but I'm not able to quantify how much of that we will see this year, right, because we want to make sure that we do it in the right way without generating a lot of disruption. And the net cash of Flatiron, it was like EUR 387 million net cash of Flatiron, but the factoring was EUR 325 million. So both things are deconsolidated from HOCHTIEF.

And the next question comes from Marcus Cole from UBS.

I've got 3 as well. The first one is just on factoring strategies. You mentioned it a few times. I just wondered how you think this will develop as the business grows. In terms of working capital headwinds from transitioning to collaborative contracts, that seems to be largely done. Is that the case? I think CIMIC is the one that was causing you the most in terms of headwinds over the last couple of years. And the last one is just on Dornan. You've given us the sales and the EBITDA, I just wondered if you could give us the PBT contribution in '24?

Okay. So in terms of factoring, I mean, we have reduced over the years our factoring balance. And our intention is just to keep it to a quite limited commercial base. So there's no strategy besides the day-to-day working capital advantage. So yes, it follows, to some extent, the sales as long as that's reasonable, but we do not have any specific strategy. On the working capital, this has been a good year overall. But in the case of CIMIC, as you rightly mentioned, it goes the other way as we finish a lot of the projects pre-2018, right? 2018 was the time that we said no more in CIMIC when it came to EPCs and big lump sum projects that came a little bit later for the rest of the group at HOCHTIEF probably in 2022. And obviously, as you unwind those, there's some unwinding of cash. In the case of HOCHTIEF, that Turner was already in collaborative 100% of the projects and target prices and cost classes. So there's -- I mean, we haven't seen the unwind. In the case of HOCHTIEF, because of the nature of the projects, those projects have already been finalized. So we haven't seen it. But in the case of CIMIC, there were big, big projects that are still unwinding. So that's why in 2024, we saw that hit in the working capital. And when it comes to Dornan, give me just one second, let me look at the figures. Okay. Here it is. So well, first of all, in Dornan, we haven't had any contribution in 2024 from Dornan because we closed in January 2025, the transaction. But the numbers of Dornan in 2024, it was sales USD 791 million with USD 68 million EBITDA, which was an 8.6% EBITDA margin, operational PBT of USD 66 million, operational PBT margin of 8.4% and that's it. All of this in U.S. dollars, by the way. This is U.S. dollars, okay, because these are the numbers analyzed by Dornan.

[Operator Instructions] So it seems -- okay. We got one more question coming from Nicolas Mora from Morgan Stanley.

Just a couple to finish. One -- just one on CIMIC. The guidance points to -- for '25 points to quite a lot of growth. But the base in '24 was inflated by the one-off gain from Thiess. So I'm a bit surprised by the quantum of the step-up. What are you seeing in the market there at CIMIC after a year where the margin has been a bit volatile. You still have a few projects to finish. But are we on the right track, both in terms of revenues and margin and including Thiess in terms of sustainable growth from here? That's point number one. And number two, on Turner -- there was -- I mean, stripping out the data center orders in Q4, which continue to be very good. The underlying so non-data center orders are slowing down a little bit. Is it just normal seasonality, fewer large projects? Or what are you seeing, let's say, in the non-DC, nonres business in the U.S. right now? And final point, if I may, just on Turner again and the data center ramp-up, why would you expect in terms of revenue contribution in '25? I mean you've got some big projects in the pipeline. Will that come in multistage packages? Or should we see another big step-up in revenue contribution into '25?

Okay, Nicolas, thank you. So starting with the CIMIC, just to make sure that we're looking at the same numbers, okay? In 2024, the operational PBT was EUR 450 million or AUD 738 million. And we're expecting for 2025, EUR 480 million to EUR 510 million or AUD 800 million to AUD 850 million, which is an increase of 7% to 13%. So it's quite reasonable, the increase, right? But for some reason, you were saying that it was quite unusual. Did I get the question correctly?

Yes. Yes, I mean, for me, it's the -- so the EUR 450 million did include some one-off contribution, but -- okay. So...

No. That's operational. That doesn't include the contribution from Thiess.

Okay. The growth...

So where do we see the growth, which is your next question. In 2024 and to some extent in 2023, there's 3 things that have been affecting CIMIC. The first one is slowing down of civil work projects. The second one is that all the energy projects, transmission lines, fiber plants, renewables, all of that, that it was going to start in '23 has been slowing down, but we expect that to start ramping up in '25. We did not see any of that in 2024, right? So that's the second one. And the third one is there has been in the last years from bushfires to flooding, issues with a new mines around nickel or lithium that started very strong, but at some point, slow down. And all of that has been affecting this. So that's basically what happened in '23, '24. And hopefully, we're going to start '25, things moving in a better direction. So that will be driving the growth. Turner, on the non-data center -- so let me go a little bit on Turner. So first of all, let me say that in data centers, a lot of the Louisiana project, for example, is not in the numbers. And let me remind that because of the nature of Turner, every time they win a job, that doesn't go directly into the work in hand because it's collaborative. It's a process to start working on the design that takes time. And once the design is finished, the contract is negotiated. So there's no -- I mean, there's a lot of potential backlog that is coming in Turner that is not in the books. On the other hand, you cannot just look at 1 quarter and try to come up with a pattern because it's lumpy. I mean it's not a perfect mathematical equation, right, the way that backlog comes. But Turner has a lot of backlog that is not reflected because of what I just explained. And obviously, it's going to come. And that affects data centers but affects other markets. Now let me go one by one on the main sectors that are part of Turner order book. Data centers, which in the new orders grew in '24. The ones in the order book without including the last one, right? But in 2024, the new orders in data centers grew 137% just in data centers, right? And the order book -- so this is the new orders, the order book grew by 87% on data centers. But when it comes to the health care market, the new orders grew 63% to EUR 4.9 billion, and the order book grew 30%. But in aviation, the new orders grew 111% and the order book by 11%. In hotels and commercial, new orders grew 195% and the order book to 92%. It's true that we're just talking EUR 2.2 billion, the order book in this case. Entertainment, new orders 54%, order book 52%, et cetera. So we are seeing a huge growth across all sectors. Where are we seeing a slowdown? Battery market, where the backlog decreased 57%. So the order backlog is around EUR 850 million. We are not concerned because that will grow in the future. It's just that a lot of these projects have been stopped because there's a lot of uncertainty about the future of the technology. So investments have been stopped, and that's why we've seen that backlog decreasing 57%. We've seen flat order backlog in biopharma, but still strong overall. I mean we have seen the new orders increase by 46%, even the order backlog remained flat. We believe that semiconductors will grow in 2025 or we expect that at least, et cetera, right? We can give you as much detail as you need. So please follow up if you think you need further information. And the data center ramp-up contribution, I wouldn't know what's the -- I don't have -- I mean, we can follow up because I don't know exact the revenues that will contribute data centers in 2025. I don't have that with me. I have the order backlog that we have given in the presentation. I don't know exactly how much is going to contribute. But certainly, there is going to be an important ramp-up. I mean, we already had strong revenues in '24 and '23, and that will continue increasing significantly.

So ladies and gentlemen, this was the last question. I would now like to turn the conference back over to HOCHTIEF for his closing remarks.

Okay. So just to say thank you so much to everyone. As always, we are at your availability to answer any further questions. But so far, thank you so much for your time today.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for joining, and have a pleasant day. Goodbye.