Vinci SA (DG) Earnings Call Transcript & Summary

Welcome to the VINCI's 9 months 2022 Revenue Conference Call. I will now hand over to Mr. Gregoire Thibault, Head of Investor Relations of VINCI. Sir, go ahead.

Good evening, and thanks, everybody, for attending this conference call. And today with Maria [indiscernible], Head of Corporate Controlling and Accounting; Christophe Ferrer, Head of Group Cash Management and Financing, online team, [ Boris Vale and Marie Richard ]. As usual, I will try to be brief to have more time for the Q&A. What are the key takeaways of this publication. First, a solid operating performance in Q3 across all our business lines. For VINCI Autoroutes, the traffic was above its pre-pandemic levels. For VINCI Airports, the recovery in passenger number accelerated. For VINCI Energies, Cobra IS and VINCI Construction, a strong business and order intake momentum. I will give you more granularity by division later in my presentation. All in all, Q3 total revenue was EUR 16.7 billion, up 26% year-on-year and plus 12% like-for-like, down in line with the trend of H1. Indeed, in the first 9 months of 2022, total revenue was EUR 45.2 billion, up 26% and plus 12% like-for-like. 9 months international revenue, which accounts for more than half of the total, was up 48% and up 17% like-for-like. Changes in scope coming mostly from the integration of Cobra IS at the very end of '21 boosted revenue by 27%. Exchange rate movements had a positive impact of almost plus 4% as several currencies, particularly the U.S. dollar rose against the euro over the period. 9 months revenue in France was up 8%. Number two, the order intake. The order intake at VINCI Energies, Cobra IS and VINCI Construction totaled EUR 41.1 billion in the 9 months '22, up 26% year-on-year and up 6%, excluding Cobra IS. Order intake increased in every business line relative to 2021, due in particular to firm levels of flow business through the whole period. The order book remained at a historically high level of EUR 57.4 billion at the end of September. It's up 26% year-on-year and plus 2% excluding Cobra IS, and it represents 15 months of average activity. This very robust order book gives VINCI good visibility and serenity allowing the group to continue being selective and cherry picking new contracts. Please note that international business represents 68% of the order book. Number three, in terms of balance sheet, the net financial debt of VINCI at the end of September amounted to EUR 20.1 billion, representing a limited increase of EUR 0.8 billion versus the end of 2021. This amount of debt is sustainable given our cash flow generation profile. It includes the acquisition made during the period, the payment of the final dividend in 2021 and share buyback. VINCI liquidity remains substantial at almost EUR 18 billion at the end of September, of which a managed net cash of EUR 7.4 billion and EUR 10.5 billion of unused [ LCS ]. As a result, we've such a sound financial position. VINCI is well prepared to continue dealing with the unexpected and continue its development notably with the upcoming acquisition of Kontron by VINCI Energies and the acquisition of the stake of OMA in Mexico by VINCI Airport. Let's now have a closer look at the main divisions. VINCI Autoroutes, 9 months revenue of EUR 4.6 billion plus 11% versus 2021 and plus 7% versus 2019. In Q3, traffic levels remain buoyant despite higher fuel prices. Resilience, they rose by 2.5% versus Q3 '19, of which plus 2.4% for cars and plus 3.7% for trucks. In the first 9 months, traffic levels rose by 2.3% versus 9 months '19, of which plus 1.8% for cars and plus 5.5% for trucks. VINCI Airports, 9 months revenue of EUR 2 billion 2.6x the revenue of the 9 months '21 and down only 13% [indiscernible] at constant perimeter versus 9 months of '19. You have already seen the traffic figures and noticed that the recovery in passenger numbers continued to accelerate in Q3 at almost all of our airports. Momentum was strong in Europe, South America and the Caribbean. Passenger numbers returned to levels equal to or higher than 2019 at several airports, particularly in Portugal, Serbia and the Americas. In Asia, meanwhile, passenger growth remained weaker because of the travel restrictions still in place at the end of September in several countries in the region, but they could increase over the coming months with travel restriction eased recently in Japan, South Korea, Hong Kong and Taiwan. Overall, the passenger numbers in 9 months '22 reached 69% of the 2019 level, of which 54% in Q1, 73% in Q2, then 78% in Q3. Excluding Kansai and Cambodian airports, these passenger numbers reached 81% of the 2019 level, of which 89% in Q3. Moreover, bear in mind that VINCI Airports remained active in M&A in Q3, announcing notably the acquisition of 29.9% stake in OMA, which holds concession for 13 airports in Mexico that together handled 23 million packs in 2019 including the airport of Monterrey, the key manufacturing hub of the country. The deal will make VINCI Airports the leading shareholder of OMA and enable it to apply its long-term partnership model with the aim of supporting Mexico's economic growth as well as its tourism industry. The concession agreement is due to end up in 2048. We will not comment on this acquisition today ahead of the closing, which is expected in December 2022. VINCI Energies, 9-month revenue of EUR 11.9 billion, up 10% and plus 7% like-for-like versus 2021. To wrap up, after a very brilliant first half, VINCI Energies revenue growth accelerated in Q3, up 9% like-for-like versus Q3 '21, both in France and abroad, that's remarkable. International revenue in the first 9 months, 55% of the total was up 11%, plus 6% like-for-like, of which plus 8% like-for-like in Q3. In France, 9 months revenue was up 7% like-for-like, of which 11% in Q3. Order intake of VINCI Energies remained robust, up 8%. In the rolling 12 months to end September, order intake of VINCI Energy amounted to a record high level of EUR 17.1 billion. Order book stands at EUR 12.6 billion, plus 11% year-on-year and represents 9 months of VINCI Energies average activity. All in all, this excellent performance was driven by bond market, energy transition and digital transformation but also by VINCI Energies diversity in terms of geographical exposure and expertise. Finally, please note that VINCI Energies remain as well active on the M&A front, having completed 22 bolt-on acquisitions in the first 9 months of the year. They are all in Europe, except 1 in Canada, and these acquisitions represent a cumulative annual revenue of around EUR 275 million. In addition, VINCI Energies has announced recently, the signature of an agreement to acquire the majority of the IT services business of German Group Kontron. This transaction, once closed, will enable VINCI Energies to grow its ICT business and establish a foothold for its [indiscernible] in around 10 countries in Central and Eastern Europe. They announced as well the acquisition of TLT-Building and TLT-Connection in Finland strengthening the Scandinavian presence of the company in energy and telecommunication infrastructure. Cobra IS, 9 months revenue of EUR 4.1 billion, of which 46% in Spain and 35% in Latin America. It was driven by good momentum in flow business, particularly in Spain, Portugal, Mexico and Peru, and by EPC projects such as power transmission lines in Brazil. Order intake year-to-date amounted to EUR 6.5 billion. This reflects solid order intake in flow business, along with some large EPC contract wins in Q3. For the record, 2 new contracts for high-voltage lines in Brazil, a contract to build and install 2 offshore converter platforms for wind farms in the North Sea. The order book of Cobra IS, is EUR 11.2 billion, a high level that represent around 24 months of activity. VINCI Construction, 9 months revenue of EUR 21.5 million, up 12% and plus 9% like-for-like. To wrap up, VINCI Construction generated a high level of revenue in Q3. Indeed, the growth in Q3 was plus 13%, an acceleration versus H1, acceleration driven particularly by VINCI's Construction international exposure. International revenue in the first 9 months, 54% of the total was up 19% and plus 13% like-for-like. In addition to a positive currency effect, revenue was driven by the ramp-up of large contracts obtained recently in the U.K., Denmark, North America, Australia and New Zealand. Not as well that the revenue abroad in the specialty networks also rose very sharply. In France, 9 months revenue was up 4%. Business levers remain very well oriented in civil engineering and in wood works, also the growth was lower in Q3 than in H1. In building, Activity was driven by several large nonresidential projects in the Greater Paris area. Order intake of VINCI construction, up 5% in 9 months '22, remained robust due to good performance in flow business in France. VINCI's construction order book stands at EUR 33.6 billion, almost stable year-on-year and represents 14 months of average activity, enabling it to maintain a selective approach to taking on new business. VINCI Immobilier, 9 months revenue amounted to EUR 1.1 billion, up 2% year-on-year, of which plus 11% in Q3. Production remains same overall, a rather good performance in the current economic environment. The number of housing units reserved in France at the end of September was down 9% versus 9 months '21, but up 2% in Q3 '22 versus Q3 '21. In conclusion, based on these very solid performance in the first 9 months of '22, VINCI confirms that it expects full year net income to be ahead of the 2019 figure. Its guidance for its various business lines in 2022 are in a nutshell, VINCI Autoroutes forecast full year traffic levels higher than those of 2019. VINCI Airports anticipates barring a [indiscernible] of the pandemic, passenger numbers for 2022 to be around 70% of the 2019 level, allowing VINCI Airports to generate positive net income and free cash flow. VINCI Energies with bond market should be able to continue growing the business while solidifying its operating margin. Cobra IS anticipates revenue of around EUR 5.5 billion and operating margin in line with the industry's best-in-class. VINCI Construction due to its very large order book, expects to remain busy and improve its operating margin while continuing to be selective. Despite geopolitical, economic and pandemic-related uncertainty, VINCI remains confident that it will be able to maintain consistent growth over the long term. The group is well equipped to achieve this due to the diversity of its business activities and geographical locations. In addition, as a provider of services to the energy, construction and mobility, it's positioned to take full advantage of new opportunities arising from the green group. We would like to thank you for your attention, and we are now ready to take your questions.

[Operator Instructions] First question from Jean-Christophe Lefevre-Moulenq from CIC Market Solutions.

Good evening, everyone. Two questions, if you don't mind. First, on the third quarter numbers on energy, VINCI Energies and also as VINCI Construction. Is the organic growth is due to a price effect? Or do we have also positive volume effect? That's my first question. Second issue is the guidance. To assume an increase of VINCI Construction margin in 2022. How do you manage this with a strong rise of the cost of factors if we take the power issue, only the power issue in France, [indiscernible] as the other competitors is covered by [indiscernible], I would say, 40%. Do you have a long-term supply contract, which allows you to more and less offset the negative effects of a sharp rise in electricity prices? Many thanks for your answer Gregoire.

Yes, it will, Jean-Christophe. So for Q3, it's not possible because we have so many contracts. I remember VINCI on the full year at around 300,000 contracts. So it's impossible for VINCI Energies or for VINCI Construction to make a breakdown between the volume and the price. So I will not be unfortunately for you more specific than that. Even if, yes, the inflation has an impact in the increase of our revenue, which is a good news because finally, it shows that we are able to pass through this inflation and the semantic of costs and material price increase. And so regarding -- it answers a bit your question number two, we stick to the guidance. VINCI Construction gross margin was 3.7% in 2021, we'll be able, despite the current environment, to keep on increasing the margin in 2022.

Next question from Stephanie D'Ath from RBC.

My first question is regarding the discussions with the government on potential stimulus plan for Toros in France and tariff freeze for next year. Could you please let us know how those are progressing? My second question is regarding net debt, which decreased nicely, about EUR 2 billion from first half. Is there anything to highlight in particular, maybe on working capital? And my third question is on the inflation impact on the order book for next year. I think you said in the past that you would expect some pressure on the order book, given the higher cost that your clients would be facing. So could you maybe confirm that you expect maybe a softer order book going forward?

Yes. Stephanie, so regarding your first question, so for the tolls in 2023 for VINCI Autoroutes than the decarbonation plan. So let's start with the tolls. So first, before speaking about the 2023 tolls hike, we need to know the reference inflation rate, which is the inflation, excluding tobacco in October 2022, and which will be now in fact, mid-November. Then the calculation necessary to apply tolls in 2023 are defined by the concession contract. Then this pricing will be submitted to the authorities around mid-December. So I cannot tell much more than that. I know there are a lot of people speaking about that. But step by step. First, we need to know the reference CPI, then to apply the contract and to propose the increase because there is a contract, you know Stephanie, that formula regarding the toll is very clear and very straightforward. And of course, the respect for contract is essential, particularly in light of the huge invested capital amount. And you know as well that past periods have shown the solidity of the contractual framework. So it was for the second part of your first question. Coming back to the first part of your first question. Let's say, no news at this stage for a decarbonation plan, but have in mind that the decarbonation of the economy in France and of the mobility and of the transport is central to -- for the French government. You know that many working groups are currently contributing to the government discussion. You may have seen yesterday that the Prime Minister, Ms. Elisabeth Borne, announced that the government wants to launch [indiscernible], let's call it, an action plan called France [indiscernible], France Green Nation. The decarbonation plan of motorways would perfectly fit with the target of this action plan. This plan covering notably the mobility and the ecosystem subject. So clearly, no, let's say, big news actionable for you today. But have in mind that if France wants to meet its climate targets fit for 55% by 2050, something has to be done urgently on motorways. You know that motorways account for around 7% of the total France CO2 emission. So France will not become carbon neutral by 2050 if we don't hurry up and decarbonize motorways. And you had a second question...

Second question was on the net debt, which decreased EUR 2 billion quarter-on-quarter, if there was anything to highlight on the working capital especially as we were expecting, obviously, a reversal from the positive impact from the last year.

I can't say a lot, but I will give you -- I will try to give you some time a few tools maybe to reconcile different things. You know that's true that the net debt decreased by EUR 2 billion between the end of June and the end of September. So what do you have between the free cash flow and the net debt evolution, you have the acquisitions. And in Q3, we did not have a lot of acquisition, a bit of acquisition for VINCI Energies, around 10 acquisitions. So you can try roughly maybe to have a rough estimate of the M&A spending in Q3. You had EUR 100 million of share buyback, that's public. But this cash outflow has been more or less compensated by the issue of new shares. And that's public as well. We issued in Q3, EUR 1.2 million of new shares multiplied by more or less the target price. So all in all, you should be able to estimate the free cash flow in Q3 and so in 9 months.

And my third question was on the order book.

Another question on the order book?

Yes, for next year.

It's -- what can I tell you -- it's a bit early to tell. If your question -- because I'm not sure to see exactly your question, if this cost increase for the project, will it weighed on demand? Maybe at a certain point, yes, there could be lower volumes but better price. So in volume, it could be around the same. But we have to increase the cost because it's not our role, let's say, to face the risk of inflation. And we will not take this risk. So we have to keep on increasing the cost. So far, we don't see -- as you see, by the way, in the press release, we don't see any, let's say, pronounced slowdown.

Next question is from Elodie Rall from JPMorgan.

My questions will be on Toro traffic, if I may. So traffic was up versus 19% in Q3, but actually down year-on-year, especially at light vehicles. So could you explain what the main reason is? Is it all because of fuel in your view? Or do we see already a little bit of a consumer slowdown? And second, could you actually give us the current trends in October? And notably, have you seen an impact -- a notable impact from the current gas shortages that we're experiencing in France at the moment?

The first question regarding that's true that Q3 '22 traffic is slightly down versus Q3 '21. Have in mind that Q3 '21 was very strong and was very high. The comps were very elevated. There was a big catch-up of the traffic after the easing of restrictions in France in May and June 2021, the activity was very booming. And last year, a lot of people stayed in France from Europe or in France during the summer. So maybe the comps are quite high, we don't feel at this stage, let's say, a negative impact on the purchasing power of people. So it cannot be analyzed like that. And we decided to keep on comparing with 2019, which is the reference year [indiscernible]. So no, let's say, no high comps versus Q3 '21. Second question, still on the traffic. In October, Yes, the light vehicle traffic has been impacted by the shortage of petrol in France. But it doesn't put into question our full year guidance, which is the traffic to be above the 2019 figure. On the contrary, have in mind that the truck traffic has been less affected, not to tell, not affected. In fact, these companies, the haulage companies often have priority and have fuel storage tanks. So finally, they could drive and they were not under any problem. If they are not [indiscernible], they came on the motorways of VINCI Autoroutes because you may have read that our fuel stations were opened at more than 90%, even during the [indiscernible] of the prices. So in the worst case, the trucks could come on a motorway to take to buy some gasoline. But now the situation is, let's say, resolved, at least, much less difficult than it was 2 or 3 weeks ago. And so I don't rule out a catch-up effect with people who could postpone their journeys, they did not do at the beginning of October or mid-October to now. So -- and holidays start in France, as you know.

Next question from Patrick Creuset from Goldman Sachs.

Congrats on the continued strong execution. Just 2 questions for me. One, can you give a bit more color on the construction margins for this year? And then also how you see the potential evolution in high inflation in '23? And then secondly, what sort of tariff increases should we be looking for in your main airport platforms in '23?

So Patrick, I can't tell much more than that. It's a revenue call. It's a trading update. We are not supposed to speak so much about the results. We can just say that we stick to the guidance, which is VINCI Construction will increase the margin. It's not easy for us. We have to be agile, we have to fight. Sometimes we have to claim. It's not easy. I don't mean it's easy, it's probably less easy than what we could have had in mind 6 months ago, as we already told you, but VINCI Construction margin anyway from 3.7% has still room to increase. But today, I cannot tell more than that in such a call. Regarding the airport, that's pretty easy in Portugal. The decision should be officialized for the aeronautical fees in 2023, let's say, by the end of November. So you should know exactly what the aeronautical fees increase for the main Portuguese airports in 1 month, let's say. You know the concession contract. You know that the reference CPI is the one calculated at the end of August. And this CPI was around 7%. So it should give you already an indication and we'll be more specific airport by airport once the CV aviation of Portugal now have, let's say, officially published, but something around the reference European CPI of 7% at the end of the August makes sense. [ Manaus ] is under negotiation, so I can tell more. Gatwick, you know there is this CNC framework, which is based on RPI, the retail price index increased with occur in April 2023. So something like -- in Gatwick, it depends on some airlines, other bilateral contracts, multiyear contracts with some discounts. But all in all, in your model, you should, let's say, try to mirror RPI minus, minus something.

Next question from Nabil Ahmed from Barclays.

I have 3, actually, if I may. First one was on the outlook for airports. We're continuing to see airlines capacity building into the fourth quarter, and yet you're maintaining your 70% guidance, which would imply that traffic would weaken in the fourth quarter compared to Q3. Is that simply caution? Or are there elements that we should be aware of? And if you could comment on what you see on Asian facility as well because I think the traffic released by VINCI Airports sounded a little bit more positive than previously. The second question was on VINCI Construction. Could you remind us now how margins compare between France and abroad? And specifically on [indiscernible] contracting, are you starting to see some positive change regarding -- related to the high energy prices? And last question, if I may. And forgive me, I know it's a revenue call, but should we expect as well some inflation impact on CapEx and maybe a CapEx guidance being revised along those lines later on?

So yes, for the guidance of VINCI Airports, if you read very carefully until today before the publication, the guidance was VINCI Airports expect traffic in 2022, close to 70%. Now it's around 70%. So yes, the difference is a bit minor. It's a bit of -- it means around -- it can mean at least a bit above 70%, close to and a bit below. So I would say that the guidance has been revised upward. And to get this around 70%, let's say, slightly in the north of 70%, if you plug the same kind of exit rate in Q4, like in Q3, you should get, let's say, this around 70%. So we do not anticipate -- even if we are always cautious people, we do not anticipate, let's say, a slowdown in the coming quarters. That's true that the bookings are well oriented in our main airport. We still see a strong demand from passengers from -- despite the increase of price tickets coming from the airline. We still see, let's say, this strong demand. So yes, no, Q4 should be well oriented as well. As you know, it means that the incremental impact should be, let's say, appealing. That second question, Nabil, on VINCI Construction margin. No, we don't give the split between France and international. And [indiscernible] contracting has been restructured. Early 2020 is not spread over the group. It does not exist anymore as a single entity. We still have the people from [indiscernible] on their knowledge, on their expertise, which is very interesting for us, notably when it's time to develop new opportunities in H2, in hydrogen, nice expertise in terms of LNG tankers. I said you that, because we see this kind of demand of the inflow coming and resulting from the current situation we see. We see the countries, notably in Western Europe. For example, in Germany, they need more and more to have -- to be sovereign on an energy point of view to be less and less dependent on some countries and to produce more and more green electricity.

Okay. On the margin...

Impact of inflation on CapEx, yes, it will increase because, for example, the contractors, they do not accept, and we, at least, don't work anymore at fixed price, at least for the mid-cycle or long cycle projects, that's a very strict rule internally in 6 months, we refused to sign a contract, which has no escalation or cost-plus mechanism because as I told you, it's not our role to manage and to face this kind of inflationary rate. That being said, it means that a concessionaire will have to pay a bit more of their CapEx.

Understood. Can I ask the question on the France versus abroad margin slightly differently. Is it fair to assume that the construction margin improvement that you expect this year is mainly driven by France improving?

That I will -- you can try to ask differently, but I will ask the same way. I will make less effort than you. No, no, we don't because it's very -- there are many divisions. It's not so easy to tell, okay, international is like that, and we'll move like that. And France is like that, and we move like that. Even France, it's origin, it's not the same, not the same trend in civil engineering, networks, roads and so on. International, it's too big. We are in 119 countries outside France. So it's not possible to tell you, there will be some places where the margin will be up. There will be some places where the margin will be down. There will be some business where it will be up and so on. But all in all, the margin of VINCI Construction should increase.

Next question from Gregor Kuglitsch from UBS.

I hope you can hear me well. So I've got a few questions. So just coming back on Construction. I mean, you had very strong growth in the third quarter, appreciate there can be timing and things like that. But can you give us some kind of sense whether there was something special there or whether we should be assuming a lower run rate? And maybe sort of both for Energies and Construction, I appreciate you now have, I think you said 15 months of orders or sort of 15 months of activity in your order book. As things stand today and given what you're seeing on the order trend, do you actually expect the revenue decline kind of in the foreseeable future, say, next year, is it too early to say? Then a question on Cobra. I think there was a large amount of contracts. I don't know if they were booked in Q3, the EUR 1 billion, there was a press release, I think, for EUR 1 billion or so. I guess that wasn't in Q3. Correct me if I'm wrong, but does that mean that business should also be ramping up in revenues? I'm guessing there's some -- I mean, you kind of mentioned it in the press release that EPC is starting to kind of become bigger. So those are contracting questions. The second question is maybe on airports. And maybe I think -- I guess we've all seen the passenger numbers, but the revenues are coming in higher despite the fact that we knew the passenger numbers. So is it good way to look at this to just take the revenues divided by the fully consolidated pack? So for example, in Q3, that would mean like I don't know, EUR 21 per passenger of revenues, and that's obviously aeronautical and non-aeronautical, is that the right way to look at it and think about sort of extrapolating that into Q4? And then beyond, obviously, you commented on inflation already.

So Gregor, a lot of questions for the last one, yes, it's a way, I would say, like another to try to make your own estimates. Why not [indiscernible] it doesn't mean a lot to try to think in terms of average revenue per pack. For such a portfolio, don't forget that VINCI Airports has a pretty unique in the world portfolio. We are in 12, 13 and soon 14 countries. We will have some more than 70 airports. So we are, by mind, the most diversified airport manager in the world. So it's a lot of different airports. So -- but to try to estimate Q4, try to do a bit the same, but there may be a bit of seasonality in the revenue, you have as well non-aeronautical revenue and some revenue which are not linked to traffic. Like, for example, real estate revenue, other ancillary fees and so on. So -- but yes, you can try to estimate a bit like that anyway. So the growth, I was asking my colleagues what were your other question because I was a bit lost. So the Q3 growth for construction was very strong. Indeed, it's due as well. Don't forget that to change impact, favorable a lot of currencies reinforced against the euro during the period. That's true, more or less for all the dollar, the U.S. dollar, Australian dollar, Canadian dollar. That's true as well for the Swiss franc, for example, which is important for VINCI Energies. So this growth is linked to change, positive change, linked a bit -- there is a part of inflation is linked to the ramping up of some large projects that's still true, and it should still be true, I would say, in the coming quarter. At a certain point, there will be a ramp down of this large project. So if we don't win additional large projects like that to compensate, there will be a ramp down. But you know that will be perfectly fine. It will be almost done, let's say, for us on purpose because we don't aim at becoming too big and too exposed to this kind of a large project for VINCI Construction. So what can I tell you more good trend in flow business? Very strong revenue increase in North America, in Australia, very strong revenue increase for the specialty networks. So Soletanche, MENA and so on. And that's it for your first question, I guess.

Okay. And Cobra?

Yes, Cobra, for the order intake. No -- we announced some several large projects, there is one which is not yet in the order book. That's the one we announced at the beginning of October, that's the first LNG terminal in Germany. That's an important amount. I don't know if we gave an amount, so I will not tell you, but it's not in the order book. What has been included in the order book for Cobra IS in Q3, that the 2 contracts for work on the electrical lines in Brazil and that the converter for offshore wind in the North Sea with Siemens. And yes, the CPC project will ramp up. Yes.

Okay. Maybe, sorry, one final one on energy. Do you care to make a similar comment that like what the run rate is? I mean it was again very strong, even like-for-like 9%, is there any reason to believe that's closed down dramatically? Or is there anything going on?

Remarkable because very, very strong in France and abroad. It even accelerated in Q3, both in France and both abroad. What we can take is that all the business of VINCI Energies, infrastructure, industry, ICT and Building Solutions are up in France, all the places in VINCI Energies abroad, most of the places are up. So how can we explain that? Probably VINCI Energies, and it's maybe only the beginning of the long-term trend is serving of this mega trend, which are digital revolution, energy transition, but inflation as well had an impact in the total revenue growth, probably. Currency impact as well. VINCI Energies is a very -- it's quite a lot in Europe. But for example, they are quite big in Switzerland. They are big in the U.S., VINCI Energies.

Okay. And sorry, maybe one final one on free cash. So I know that -- I mean my calculation based on what you kind of just commented on earlier implies that I think Q3 free cash is maybe up actually year-over-year, I don't know you probably have the numbers, but up maybe, I don't know, EUR 200 million or something like that. So does that mean you think you can be comfortably ahead of EUR 4 billion, say, for the sake of argument or you don't really know yet?

Well, I gave, Stephanie, some tools to try to estimate what could be the free cash flows. I'm not going to comment. Just have in mind that the working cap change at the end of September is still negative. So on one hand, there is a very strong operating rebound. On the other hand, there is still a negative variation of the working cap. But let's say, at the end of September, that's, I would say, normal or common at this stage of the year. So the working cap improved in Q3, but over the 9 months, still remain negative. I mean, the working cap change still generated a negative outflow by definition. What is -- that being said, what is important is to see what will be the trend in Q4 2022? You know perfectly, that's the most important quarter in terms of cash flow generation for a group like ours due to the operational profile of our businesses that at the very end of the year that we generate the free cash flow we are like in the toy industry. To be even more explicit because you asked that, Gregor, can we see, let's say, expect free cash flow of around EUR 4 billion, we'll see that probably, yes.

Next question from Sathish Sivakumar from Citigroup.

I've got 2 questions. So firstly, on the auto traffic. Obviously, just flat that Q3 is slightly down year-on-year. So what is your expectation as we go into Q4? Do you expect like a similar seasonality trend in terms of normalization? Or is it continues to be like down into Q4 as the overall international travel starts to recover? And then just related to that, what is your expectation on the fuel subsidy? Do you expect it to continue beyond December into next year? And what will be the impact on your pricing discussion with the government on the fuel subsidiary to continue into next year?

Sathish, about second question, it's not our role to commence decision of the government. If they want to keep on subsidizing the petrol price, that's their choice. Do I think they will continue or not, honestly, my advice is not smart and has no importance. So ask the French government. Point number one, what will be the trend in Q4 '21 -- '22 versus Q4 '21, if it's more or less your question. Again, we communicated with our guidance on 2019, which is the reference year being the year before the COVID-19. And what we said is that the traffic in 2022 over the full year will be above the traffic of 2019. So we don't compare to 2021 and even less quarter-on-quarter. So we really communicate on 2019, which is a reference year. For Q4, what I said a bit earlier is that for the light vehicle traffic, not for the trucks, but the car during a couple of weeks in October has been impacted for obvious reasons by the fact that there were some shortages of fuel in France. And if you cannot fill the tank of your car, of course, you don't drive or you don't take the risk to be stopped in the middle of nowhere. So -- but it does not put into question or guidance, which is compared to 2019, Sathish.

Next question from Jose Arroyas from Santander.