Vinci SA (DG) Earnings Call Transcript & Summary

Welcome in Madrid for this Capital Market Day dedicated to Cobra IS. My colleagues and I are delighted to put the spotlight on this outstanding company which joined Vinci almost 2 years ago. Its integration within Vinci is a success, definitely, both on a human and business point of view. Cobra IS is over delivering our initial expectations, as you will understand today. Next slide, yes. Okay. As you know, Vinci as a pioneer has been focusing strategically and consistently on its energy activities for more than 20 years. This has resulted in the sharp internal and external growth of Vinci Energy, those expertise have proven to be fully aligned with the energy and digital mega trends that we have been observing for some years now. The group's expansion in this area further accelerated with the integration of Cobra IS in the last 2 years. Today, Vinci's business model is even more resilient, less cyclical and strong than it was previously with 3 large main sector of activities, concession, construction and Energy Services. As a result, we have today an almost unique and unrivaled expertise, which will enable us to leverage on the huge opportunities offered by the global challenges such as energy transition, mobility needs, urban development and digital transformation. Last but not least, Vinci can rely on very solid balance sheet and a significant amount of liquidity to finance its development strategy. That said, we are confident and enthusiastic about the future, which should be bright for Vinci. Vinci's companies and expertise are involved all along the value chain of the energy business from power generation, transformation, transport and distribution to electricity end markets, decarbonation and energy efficiency. That's a key positioning. We are at the heart of energy challenges, which are ramping up worldwide, particularly since the beginning of the war in Ukraine. Countries are targeting to be more energy sovereign. Are increasing the share of electricity, particularly from renewable sources in their energy mix. Our clients worldwide want to reduce their carbon footprint. They are looking for energy efficiency through renewal of buildings, infrastructure networks and production sites. Decarbonation is on the agenda of everybody everywhere. It is urgent and will require trillions of investment worldwide. Vinci as one of the world's very top leaders and players of this market is ideally fitted and positioned to benefit massively from these long-lasting trends. A few figures to see how big and important this energy business boosted by Cobra IS is for Vinci. Revenue of more than EUR 22 billion last year. That's almost 40% of the total consolidated revenue. Energy's EBIT account for almost 1/4 of total group EBIT. Finally, 50% of our total workforce are employed in energy-related activities, not talking about Vinci Construction, which is generating more and more revenue out of the energy-related projects. These are 22 figures. No doubt that the contribution of energy will keep on increasing steadily in years to come to become in a few years time and probably quicker than one could expect the largest business of Vinci in terms of revenue. So it's now high time we deep dive into Cobra IS to highlight its organization, its corporate culture, its expertise in both flow business and EPC energy project and main geographies, which are very complementary to Vinci's one and also its strategy and outlook. To do so, let me introduce the speakers for today's event. Christophe Pélissié, in charge of the business development at Vinci will remind us the rationale of this acquisition and disclose the midterm and long-term financial forecast of Cobra IS. Christophe was personally involved in the almost 2-year lasting negotiation with ACS Grupo, which were successfully closed at the end of December '21. Then José María Castillo, CEO of Cobra IS will present the snapshot of Cobra IS in terms of businesses, key success factors, risk management, strategy, ESG commitments. Both José María and Christophe are colleagues of mine in the Executive Committee of Vinci. Then we will hear José Luís García, CFO of Cobra IS. He will cover all you need to know about the flow business. Then Raúl Llamazares, CEO of Intecsa Industrial, one of the 15 subgroups of Cobra IS. Raúl has been managing complex EPC projects for more than 20 years in many countries. He will share with us his knowledge on this business and our risk management, a key success factor for EPC is tightly monitored at Cobra. Pedro Ascorbe and Cristina Sanz, President and CEO of Dragados Offshore, another very interesting subgroup of Cobra IS will do a focus on the HVDC high-voltage direct current offshore platform, a very buoyant niche market with stellar growth perspectives. Bautista García, Head of Industrial Plants and Energy for Cobra. He came from Peru, not today, but yesterday, where he has been living for many years. And Raúl will present you a case study on an ambitious project to be one of the most modern refineries in the world in Peru. Then José Antonio Fernández, the Head of Renewable Energy at Cobra IS will describe Cobra's strategy and competitive edge in this sector to build over time a significant and valuable portfolio of renewable energy assets. And then I will be back on stage with Jose Maria at the end of the day for the conclusion and the Q&A session. Thank you very much.

Good morning to all of you, Christophe Pélissié du Rausas, I am the Vice President of Business Development of Vinci SA. I have been quite active in negotiation for 2 years. And in a way, I'm very pleased to be with you today because I am dreaming of this day for 2 years. So thanks to be here, and I'm very pleased to be with you. What I would want to do is very simple to explain you why we did this acquisition, what was the rationale. Second, what -- a quick blick on what we have done in 2 years. And thirdly, how we -- what kind of common vision of the future we have. So next slide, please. Taking it from where Christian left it. We're going to show you 2 things by this slide. The first one is that the Energy services and project activity within Vinci today is of great importance. Certain figures have been already disclosed by Christian, 36% of revenue, 50% of employees, 23% of EBIT, 17% of capital employed. So you see this important today of this activity within the group. And on the right side of the slide, I don't know if you knew this ranking showing that why by far, the unrivaled leader in this activity in the world with a turnover around EUR 25 billion and you see then the ranking of all the other competitors in the world. I don't know if you are in the mood of challenging us today. If you are in the mood of challenging as, you could say, look, guys, for years, you have told us margin over volume, we don't care over volume, and you are speaking us today about volume. I would answer 2 things about that. The first thing that, okay, we are first in terms of volume. But as you will see today, we are also first best-in-class in terms of margin. And I think it's quite important. So we have not forgotten and were not given up this motto of margin over volume, we were a leader in this activity, and we are also best interest in margin. The second thing I want to insist upon is that in the actual circumstances in this actual market, it can make sense to have an important volume in this activity, why for 3 reasons. Firstly, you have certain clients in the world that by the extension of their facilities, like to have a contractor, a supplier, which is able to serve them in the -- in several locations of the world. This is the first reason. The second one that inside this contract, you have a proportion of procurement, which is quite high, typically up to 50% and by the volume, you have a better buying power on your own suppliers. So it's a factor of competitiveness. And the third reason that I think we insisted upon that today is that you have today a kind of disequilibrium between supply and demand in the sector, totally driven by the energy transition. So when you do the complete consequences of that, a key factor to be competitive in your capacity of attracting talents and you are better placed to attract talent if you are a company with a global presence. So these are 3 reasons for which we really think this positioning as world leader makes sense. Can go to the next slide. So what I would going to do in 2 very short slide is explain you why we did this acquisition, what was our rationale and I will do that by 2 set of reasons issuance. The first set of reasons is completely linked with the perimeter with the scope. We found some obvious complementarities within Cobra IS on our own scope of services. And the second set of reasons are more what you could call a kind of future fit that I would try to explain. The perimeter reasons are very simple to explain. There is, firstly, a geographical complementarity. Cobra IS very strong -- was very strong when we start the discussion, and it's still very strong in [indiscernible] in Latin America, where synergy was all absent or not so strong. But there is complementarity in terms of expertise. Why we were and we are still very strong in electronic chemical projects, let's say, small- and medium-sized projects, what we call flow business, because you usually do it in a recurring manner with your clients. We are strong in certain EPC contracts in other sectors of construction, more civil works oriented. We are not really present in this segment of major EPC electromechanical contracts. And this Cobra IS was bringing us this segment of expertise that we didn't have. So this is the second perimeter complementarity. And the third one is, I think, obviously, because it is the renewable platforms that we didn't have. We were, as you know, and we are present in certain sectors of investments long term. We are present in the world of renewables through EPC, through engineering, through construction, through maintenance, but we were not present in terms of development and Cobra IS brought us that. And that are the 3 main complementarities in terms of perimeter. So if we go to the next slide, these are more [ cultural ] reasons that confirm our willingness of doing this acquisition when we started the discussions on negotiations. And I have highlighted there trying to sum them up have highlighted them in main reasons. The first one, what we found out in Cobra IS, as I have always not in Vinci, is this willingness of diversifying your risk by the time horizon of your contracts. You see what I mean, in Cobra IS, we have very short-term contracts like 1 or 2 months, let's say, EUR 20,000, EUR 30,000, EUR 50,000, EUR 100,000. We're also let's say, midterm contracts 1, 2, 3 years, where you are more in the range of EUR 10 million, EUR 20 million, EUR 30 million, EUR 50 million, EUR 100 million, EUR 200 million. This is another time horizon, but we also have contracts where you invest yourselves within 20 years, 30 years in higher investment level. And this I think, is really in the DNA of Vinci, and we found out it was also in the DNA of Cobra IS, and it was the first [indiscernible] conference. The second one, which is perhaps even more important is that, as you know, in Vinci, we strongly believe in decentralization and autonomy of business units. And we found out exactly the same philosophy within Cobra IS. You have here certain figures on this slide. You see a figure like 500 -- 150 business units. If you make a very short calculation, the order of magnitude of Cobra IS, when we started the discussion was around EUR 6 billion. If you run this figure up to 600, you see that the average size of the business unit is around EUR 10 million. EUR 10 million, it's not huge, and it's more or less the same order of magnitude of what we have in Vinci energy. So we were really on the same -- on the same page in terms of decentralization, autonomy and willingness of empowerment of the head of these business units. Just to tell you the words that are used in our language, in Cobra IS, they speak about Delegaciones, and the head of the delegation is delegado. When Vinci energy was routes are in France, they speak about entreprise and share enterprise. So these are really something where we had a contract convergence. And the third cultural conference is obviously that we found a real group of engineers, easier to deploy their activity around the world and with a strong entrepreneurial spirit. These are the -- if you want a set of reasons that convince us foundry to do this acquisition. And if you go to the next slide, you will see what I could call the 3 pillars of this activity. If you have followed me, you have the flow business, you have the EPC, and you have the renewable assets platform. So some words about each of them. The flu business, when you make -- I don't know if you realize that if you make the sum of VINCI Energy Plus, the flow business part of Cobra -- the flow business part of Cobra if you wanted to keep a figure in mind is around 2/3 of Cobra, 2/3 business, 1/3 -- 2/3, if you add up 2/3 of Cobra on Advance Energy, you are in the range of EUR 22 billion. I think this is an unrivaled platform of flow business in this business. EUR 22 billion, and it really makes you in many countries, the market leader or one of the market leaders, and we think it's quite important. Regarding what I would want to emphasize 2 things. The first one, when I compare the landscape of competition of EPC projects of major electromechanical EPC projects, compare the landscape of today, and I compare it to the landscape 10 or 15 years ago, I see a much higher scarcity of players. You have less and less companies able to do EUR 1 billion contract in this sector, less and less. And as the demand is booming because of the energy transition, and that's obvious, I would say, nearly every day, it gives you the capacity of selectivity, which is quite welcome in this world of major EPC projects. And the second thing I want to point out, Again, if you were in the mood of challenging us a little bit, you could say, you have explained that for years that you wanted to maintain a reasonable exposure to major projects. And by this acquisition, you have additional exposure to major projects of the magnitude, EUR 2 billion, 1/3 of EUR 6 billion and isn't it [indiscernible] risk. I think you can -- you should take into account that the risk profile of this electromechanical EPC project is quite different of the EPC project as a sector of construction. And why, again, because you have this quite important proportion of procurement up to 50% and to manage. So this proportion of your risk can be up to 50%, which is procurement, you basically need firstly, a good design. And second, a good procurement management platform with an international basis and the capacity of buying the best part of the object worldwide at the best price and the best quality. So it's a quite different risk management. And in parallel, your exposure to what I would call the local risk like in -- on 1 side, the sell conditions, the geotechnical and so on or in the other side, even labor conditions, or permitting and so on is decreased by this proportion of procurement. So that's why we are convinced to accept this higher exposure to major projects. And if you combine that with what I said earlier, which is selectivity and capacity of selectivity, increasing demand on scatter players -- that's why we are convinced it might be successful segment, which we have been confirmed in the last 2 years. And what you see on the right side of the slide, the renewable assets platform is, okay, obviously, what we wanted to acquire. And you will have more information about it where we are, what we have done in the last 2 years and what -- how we project ourselves for this platform during the day. So if you can go to the next slide. So that's why I tried to explain you why we did this acquisition. Now I have a very quick glance about what we have done in 2 years. You will have much more explanation today, but a very quick glance and then how we see the future. So what we have done in today is you have this side which is more quantitative, some quick figures. The next one will be more qualitative some projects before looking what we can -- how we see the future. I think these figures speak for themselves. When we had this perhaps certain of you were in the room where we on the phone when we were in this analyst conference, it was the first day of April 2021, and we have signed in the -- during the night. And we said we think the margin we're expecting after due diligence for Cobra IS is 6-plus percent that more or less the word that was pronounced by our CEO, Mr. Huillard. And today's, margin is 7.4%. So we are above our expectations. Certain of you perhaps you knew what kind of margin was released by ACSIS. I would want to insist on the fact that it's not the same perimeter because the acquisition perimeter, we didn't buy a certain number of mature concessions that we didn't think we are making sense to us. So it's not the same perimeter, but the margin on this -- the margin there, the 7.4% in the last 12 months, the margin is above our expectation. And I think also the figure for the backlog, which has been nearly multiplied by 2 speaks for itself. And some examples of a little bit more color about what has been done in the last 2 years, if you go to the next slide. So here, you have -- you have six examples of projects, 4 of them being EPC and 2 of them being flow business. So we think it's important also to show the business because it's contracts that are perhaps less visible. You have less media traction, but they are, firstly, 2/3 of business. And second, I think also they are very important in the life of citizens, in the countries in which we are present. So you see, firstly, contribution to the fiber-to-the-home program in Peru, where we are quite active and we have business in Peru, which is quite successful. At the bottom of it, you see our contribution to interlocking and signaling in Spain. And then you have 4 images of major EPC contracts that have been won -- that have been won in the period since January 2022. The first one is the electromechanical package for the Femern tunnel. You know the Femern tunnel, major and huge tunnel enough tunnel, which will link Germany to Denmark. And Cobra IS has been awarded the electromechanical package of this tunnel. Perhaps you remember that Vinci Construction construction is the leading company of the consortium, which is building the civil works, so we are doing the civil works in Vinci, and we are also active in this electromechanical package with Cobra IS. Then on the right of this image, you have a scheme of converter -- HVDC converter, HVDC, high-voltage direct current, which are these substations offshore that are absolutely necessary in order to convert the alternative current that is coming from the wet farm to direct current. So you can transport the current to the shore in minimizing the losses of energy. And these kind of projects, you build them for typically 1 gigawatt or 2 gigawatts. And they are absolutely necessary for the good functioning of the offshoring. I think from time to time that perhaps the [indiscernible] have forgotten the importance and the budget for -- I mean, all these grid reimbursement or this transforming objects. And we were able to get, I think, a total order intake of 12 gigawatts for this object, which is totally huge. And the value of the contracts linked to this order intake at our perimeter is around EUR 7 billion. So it's quite huge and this has been accomplished in the last 2 years. You see then on the left bottom side, an image of high-beta line in Brazil, where we have been able to be awarded 2 PPP public-private partnerships and 3 EPC, engineering procurement and construction, meaning we are investing for the Brazilian authorities in 2 projects on building the high-voltage line. And for 3 contracts were a pure EPC contractor for another investor. So what it means, this activity in Brazil that we found out and we did the due deal at that time in years 2020 and 2021, mainly 2020, has been totally successful in the last months in order to renew its order -- its backlog. And the last as you can see, is also linked to the energy transition because it's a recodification that we have been awarded in the north of Germany. This is totally linked with the new equilibrium in the world of energy linked to the Ukranian war. Germany cannot import any more Russian gas. So it has to offload liquid, gas and to have a regasification terminal that is so at the north of Germany, value of the I mean value of the project is around EUR 1 billion. So -- and you can see on the right of the slide, 2 examples of projects that we have developed from scratch from greenfield. The first one is -- this is our -- to accomplishments of the renewable platform. The first one is Belmonte, 600 megawatts that has been connected to the grid successfully in July this year, and we are producing electron every day now in Brazil. And the second one is under construction in Spain in one of the photovoltaic plant that is under construction in -- which is under construction in Spain. It's a total project of 1.2 giga out of which 800 megawatts will be under construction at the end of this year. And this is the photo of this construction. So after this very short and -- I'm sorry, about very quick trip, but what we did the acquisition, why you did the acquisition, what we have done in the last 2 years, just a word about the kind of guideline you can imagine for the next 2 years. And here, you have the figures that we could not [indiscernible] for the next 2 years. So we think the revenue in contracting, EPC plus for business, the revenue should not be less at EUR 7.5 billion. with a margin which should not be less than 7.5%. So it's quite easy to remind. That's what we think for year 2025. And for the renewal platform. We think the additional capacity we should be able to bring to the start of construction every year is -- should be in average 1.5 gigawatt, meaning in year 2025, we should have 5 gigawatts under operation or under construction, 2025. In 2030, we should have 12 giga under construction or under operation. And when you consider these figures at actual market conditions, depending upon the technology, depending upon the country, it means the CapEx -- the average CapEx investment is in the range of EUR 1 billion, again, depending upon the country and depending upon the technology. Today, the mix in our pipeline is around between 80-20, 90-10 between PV and photovoltaic and win. So that's the main facts and figure I wanted to transmit you today. And I'm very pleased to leave the floor to José María, who will explain you more Cobra IS. [ His team has ] a way to tackle the markets. Thank you.

Okay. good morning. I'm going to try to explain you in a few words and not to bore you so much you what is Cobra IS. It's a complex company to understand, but I think that after my explanation, you could evaluate better than now. I am going to stop a little bit in the first slide, please. Because here is the health of the company. Here is the explanation of how, why we are so success in this industry in the last 34 years. In terms of figures, we are pretty big company in this industry. You can see that we have 65 countries or more, our footprint there. We have more than 40,000 employees. Our level of revenue is in this side, you can see there, EUR 6 billion -- and we are developing and constructing now in this moment, 2 gigas Well, there's 600 that we have in operation today and why and how, okay? There is no other company in the industry with this capacity to do different activities in the whole value chain of this industry. There is not. There was, but broke. There is not. It is not any company with 2/3 of the revenue inflow business. At the same time, that is -- has the knowledge to do complex EPCs. And at the same time, has inside a platform success renewable energy platform that has been put in place in the last 25 years. This is something unique. And what this allows us to do. That's the big advantage that Cobra IS has in this industry. This structure of businesses allow us to go to the market or to the activity or to the country when we smell that there is money there. And if you show what we did in the last 20 years, you can see these movements. The origin of this company is the flow business and it's the spirit of the company to have the sensitivity to know where is each euro, where is each guy that works for us, what is each problem where is each advantage. And that is the spirit of the company, okay? And we are not going to go out of this business in our life. It's more complex to manage that EPC projects or to do or to say that we are developing renewable energy because it has in the other way that people think much more highest barriers to entry than the DC projects. To build an EPC project, you only need a balance sheet at the bond, the some banks that go for the world gives you a guarantee to bid. This is the only way [indiscernible] I assure you. It's the only barrier you have. People think that the was -- if you have the guarantee of the bank and you have the balance sheet, you can offer them. But with these contracts that are so recurring in terms of cash and so stable in terms of revenue. You can bid with one guy saying that he did a combined cycle 10 years ago, you can't because people want to see your resources, your human resources, you spirit, your equipment. And from this original business, we went many years ago to the other 2 activities because we [indiscernible] that perhaps we could increase our margins in them. How we face the EPCs. We faced the EPCs in the same way that we face for our business with very high respect to the countries, to the customers and absolutely rigorous way to approach to the contracts. Here is the key. The contract is more close to the -- how the contract is. If you're going to have a success that what is the level of the price remains. This is key. All the companies that has had problems in the past, all of them are due to bad contracts, to sign absolutely impossible contracts. And [indiscernible] majority of you that know about the financing industry must know that because you see a much of you ask your customers or people that ask you money that for this investment, you have -- you want my money, you must have this kind of contract with your EPC business, the EPC contractor. This contract that financial industry wants key companies in EPC contractors. This contract that the financial industry as to their customers saying, I need to give you their money this contract with these clauses. Okay. This contract with these closures are not signed by Cobra IS. Then if the majority of banks or financial institutions need these kind of contracts to lend money to their customers. Cobra IS is not going to be in this contract for sure. I don't know what is going to be the principal contractor, but it's not going to be Cobra IS. And final, we have the renewable energy asset platform that we put in place more than 25 years ago in Spain, obviously, because we want to try to, at the very beginning, pull our EPC contractor capacity. But after that, we saw and we see that we can do a good business and a good profits with them. With all this flexibility that we have to change the country's and to take activities that we work because we have the capacities and the knowledge, okay? We never failed a single year in our life in terms of margin. Never in 20 years. And people who say that this contract that you are increasing the backlog with risky contracts, we are not increasing any of our backlog in our life with risky contracts. And this is not going to be first time with the huge market we ever see, this is not going to be, okay. Perhaps it is less risky than what we had years ago. Never in 20 years, we never failed in margin. We are not going to fail in the next 20 years. I don't know what is going to be the reason to fail in the next 20 years. If we didn't fail with other kind of market. And I'm going to disclose some figures. In the last 2 years, included this, we have cash conversion above 150% of our net profit. And we are going to continue in this way, and improving it. And that is because we know how we must be to create value for our shareholders. This is our unique in the last 20 years, nothing new, unique target we have. This huge management team I have that is the best in the industry. I'm going to repeat some of these messages in the next slides, okay? But I want to fix in this slide the main messages for this meeting. Here we have -- here, we have what -- how we create this company with this advantage that I explained to you before in terms of create in global -- the whole value chain actor in this industry. From the creation of Cobra in 18 years ago, through the merge with Geralds Industrial that come here with some of the company that you are going to know today with the capacity that they know. They have sorry when we appear in the renewables industry and why we go out of some countries and appears again when we smell again that we would be profitable there [indiscernible]. Please next slide. How we win. We haven't a secret of the coke. There is only one secret that this management team I have [indiscernible] then as the others can't have this management I have, they can reply it. Because this is not going to be in this meeting any word that could be new for you about what is -- how you manage the risks. There is only one way to manage the risk, say no when the contract is not comfortable. This is not only because all guys that talk to you about all these list of issues you must check to understand if you must go to the contract or not, is to see -- to say, yes, yes. done, done, done and sign any contract they have. That is the committee risk process and so on. You must say no when they ask for stupid things. For example, for consequential or the profit or deny you any first major something like that, people sign it. And after that, people say, no, Brazil is a bad country because this company has a problem in Brazil, why Brazil. And ask the contract for this company. Ask what happened in Brazil. And really the [indiscernible] organization, this is our head, okay? But really, the centrality [indiscernible] past organization with a huge holding looking for these guys that are the central decide to control them because this is not the same tons anything. [indiscernible] operations has risks for sure, for sure. But if you have the best management team in the industry, you can do it. But if you have some guys of you, some friends of you, you have a problem to decentralize that operation. But this key is have the best management team and really the central site organization. We are cautious with where we must do businesses. We are going to see later our project in Talara, -- that is a big refinery in Peru. If this contract appears in U.S., imagine, we will not be back on track. Then you are in business around refineries, it depends. It depends. In Peru, for example, for Peru with the team we have in Peru, yes, we've been. But if we must go to Australia to the combined cycle, we are not going to do. I know that it's most sexy Australia than Peru, but we are not going to go to Australia because we have money there in Peru. I don't know what we are going to throw it in Australia without any knowledge about the country that you are in the [indiscernible] second industry. It depends. It depends. We have this [indiscernible] company that I explained to you before, and we are focused on margins, all our life, people said -- and with some reason say that we are so conservative in terms of growth. Yes. We have now an advantage is that the market has [indiscernible] then with this huge market included us are going to grow a lot. If you ask that we are so conservative and so no enough aggressive -- included as we are going to grow a lot. And we have a platform to develop green energy that has demonstrated in the last 20 year that at least we do in a reasonable way. I don't know if we are the best, I think no. But we are pretty high in the classification. Okay. Next slide, please. And this is the game, okay? This is the organization we have absolutely decent trade side with 15 subsidiaries that are the head of the company. These 15 guys with their teams because these guys have really decentralized company behind them. This is nothing that I am decentralize because in my [indiscernible] we are 15 and go to these 15 subsidiaries. In these 15 subsidiaries, we have head of people trying to control every of their operation we have below them. Now we have a really decentralized organization behind these guys. Next slide, please. Here, you could see what is -- you can see what is our actual situations in terms of revenue and backlog. You can see there that we are as you know, in our historic regions, South America and Spain basically. And you can see that we are growing or we are going to grow due to our backlog numbers in -- now in different regions. For example, in rest of Europe, it's true that this has something to -- is linked with the allocation of this backlog that we have in Dorados offshore because we have this backlog allocated in rest of Europe because the device is installed there. But as you know, and you are going to know ahead with explanation that Pedro and Christina are going to give you we are going to manufacture these devices and [indiscernible] or part of the Mexico if it is necessary. But you can see there that our [ food ] business is of [indiscernible], as Christophe said, and we have this, I suppose now, it's normal to have a huge backlog in EPCs and less in flow business. A backlog in around 12 months in flow business is a healthy backlog. Normal would be in between 10 to 14 months because contracts die and [indiscernible], then this is a natural way that we have. What we have here is the explanation that we have a much huge backlog in EPC that we ever had and this is where it's going to be the next 2, 3 years' growth because flow business, as you know, are going to be basically in the GDP of the countries we are. Next slide. This is the explanation. We are in the whole value chain in all the activities and the whole value chain in all the parts of any contract before, between the scratch develop, the engineering, the construction and the maintenance and operation of the contracts. And in the same way, we are in all of these activities in network that is our original activity, more focus on electric distribution, water distribution and communications distribution -- distribution, communications facilities. And we are in an electromechanical installations on maintenance of operation in an industrial building or work we have a very huge exposure to control systems, basically linked with mobility. In Spain, we are leaders by far. And now we are exporting this kind of projects to U.S. and to Australia mainly with great success. We have the capabilities to do this integrated project that as the EPC projects. And we have the knowledge to develop and to create value for the company, with our investment in assets. Basically energy, green energy, transmission lines and [water]. Please, next slide. You know this is the list -- everyone for this list. You will talk with the companies that broke in the last 10 years has been with injection of capital from the government in the last 10 years, and all of them talks about commercial, technical control, legal, financial, safety, regulation will have all included in our in our risk process, metrics, yes. But this is [indiscernible] if you don't say no to the contract because you don't resist the pressure of the market that say your backlog is going down and guys have signed at any price. 5 years later, what we have? What we have 5 years later? 1 year clap and 5 years later, what happened. Now this is one write-off without cash impact. The cash impact was the last 5 years and the benefits you say in the last 5 years was live one write-off. No, it's a legacy company [indiscernible] holy spirit. Okay. Then what we do? What everyone does. This. But with rigorous real rigorous analysis of any project and with real discipline about what we could assume and what we couldn't. That's what -- this is one of the reasons because during the COVID, our backlog goes down dramatically because the market did this in 1 month, and you can decide, you must decide. You fight for this absolutely a small market, fighting against everyone at any [indiscernible] and wait for your opportunity and opportunities have a bigger as you must began as you are waiting [indiscernible]. My shareholders say that, yes, this could end in the file out of the CEO, okay? But this is not going to find to end in the disaster for coverages. This is something that you must understand. If we are not going to put in risk our company, all the shareholders in our life because we want to be here 1 year more, signing any contracts to if they want to change of the CEO of the company because the backlog is going down, change it. But we are not going to give opportunities to this pressure. Next slide, please. And this is what I said we are not rookies in this industry. We have been in this industry for [the last 25 years] in the renewable energy, we began 25 years with some thermosolar and wind farm plants here in Spain when the situation changed we decide not to be [going] to do more than we did something in Mexico. In South America, sorry. And after that, we thought that could be another opportunity here in Spain. We began again with that big auction that we won in Spain that was another surprise that people said that this Cobra guys has become interesting about this, how they were people friends of mine in big utilities in Spain that Castellum has to side with this decision was a good success. We smell that was something there and we want and now as you know, we have some opportunities over the world and about offshore is going to be explained better by Jose Antonio, but we are so confident about that we have not much special part of all of this Guitar list of potential projects but are not compromised around money when we have basically one project and this is -- that has a good exercise, and we are going to have good solution for it. And this is our compromise and what we want to do. And in the same way that we never said in terms of margin in 20 years, we are not going to fail with our compromises in this way. Perhaps we have [indiscernible] delay in some of them is true, but we are not going to fight. Okay. Next slide, please. And in the same way that we have these people about around the margins around our contracts around our activities, we have the same discipline around safety because for us, is something that is not negotiated because there is the heart of our company, people. Our treasury, we haven't assets today. We are going to have, but we haven't assets today. Our unique asset is guys. When [ Bansi ] paid EUR 4.2 billion. They were -- they paid that money from 42,000 guys. We haven't any assets. Our headquarter is rented. It is not our office, okay? It's rented. We haven't assets. They pay that for this management team and for this 42,000. Then we must have them safe. And in the same way we do with the rest of the business. We have a really essentially sized responsibility in this item in safety. And any of our workers has the power of the empowerment to stop any contract -- if they, the guys that are working or are going to work, they don't feel safe. Then our stock work policy is key here and is key and is part of our spirit the centralized of their responsibility in the company. Next slide, please. As you can understand, we had all the commitment with the environmental, social and governance issues. We are 100% aligned with [indiscernible] ambition. And we are -- we have, in my opinion, this is my opinion. -- and a very good ESG program before [indiscernible], but now with [indiscernible], it's my opinion that we have a better one. This is nothing that we could hide, but we are absolutely aligned with this ESG program and ambition that [indiscernible] has and as the rest of our business and in way of life, we must be the best also in these issues. I many times said my management team that is our obligation to be the best. We can compete in terms of margin with Apple, I don't know, with Google, I don't know. But there are not excuses to not be the best in our industry. And we are not going to achieve 20%. We were in 10% perhaps in the next year in terms of EBIT was someone of you ask of, how you're going to increase to 11%? I don't know. Could be. Could be not, Okay. Because this is not apple. Okay. This is not a startup. This is no Coke, but we haven't any excuse to not be the best in any issue in our -- around our business. And this -- in this, we must be the best too. Next slide, please. And this is what we have. As I summarize, we have 15 subsidiaries with the best management team in the industry by far, all of these companies are doing money, all of this, all of them. They are not any of these companies asking money for orders business squeezing the money of orders because we want to -- if one of these lose money 1 -- more than 1 year, we close it as we because we are not going to be involved in any market or in any business when there is no money. And what happened with the backlog? Everyone is talking about these guys are -- we call -- they are inflating the bond -- they are inflating the bond. They are contract at any price that became crazy these guys inside [indiscernible] has changed and they want to show what. No, no, no. This is the most healthy worthiest and less risky backlog we ever had. And I try -- we try to explain to you later. The best -- there was the healthiest and less risky backlog we ever had and the highest is true. But we were in this size of market and the market has done this in 6 months, in 1 year, and we are there. We are lucky, yes. We are lucky. For first time in our life in this hard industry, we are lucky, yes, yes. Then you are going to disclose exactly how it's going to be the margins of each contract, not. But because perhaps some of our clients could be panicked and we don't want that. Okay. I expected to explain this all better with our management team that are more brilliant than me, but -- and in the Q&A part, I am going to try to explain more. But we never failed in 20 years, we have the healthiest highest backlog in our life. We are in the best, best momentum of the market -- of our market in the history. I don't know what happened when the steam machine appears. I don't know because I don't were there. I don't was there. But for sure, the best momentum of our market in the last 50 years. And we are using it, and I think that we have the best future in the next 2, 3 years, for sure, that we ever had. Thank you. Now we have the coffee, I think. [Break]

Okay. Good morning, all. After this general view of [indiscernible], given by [indiscernible]. Now we are going to get into more detail, and I'm going to speak about the flow business. So flow business activities are core for our companies. Most of them have born in flow business. So we can say that flow business is in our DNA. With more or less importance, all of our 15 groups have some flow business activities in the portfolio of contracts. For example, the [Dragados] offshore, that is a pure EPC contractor has the O&M of a gas compression platform in Mexico or [indiscernible], that is another pure EPC contractor that has a division for the O&M of transmission lines in Brazil. Getting into general figures, flow business amounts EUR 4 billion in LTM revenues and backlog is about EUR 5 million. These figures are down with around 30,000 employees in 51 countries and you will be listening to me saying that flow business is recurrent, flow business is stable. But we could say that we made growth in the flow business in the last 6 years, about EUR 1.2 billion at 42% helped by an impressive increase of our international flow business that has doubled the figures in this period. Despite this growth, in international business. Spain is still the most relevant geography for our flow business activities, around 60% of revenues, growing at 15% in this period. That is not so bad. I'm talking about the growth of our core business, but this term means recurrence with a stable and more or less predictable revenues and cash flows. What's more we can say for some of our contracts that has been renewed in the long term is that flow business is like a concession. I will show you a couple of examples in [indiscernible] slides with contracts renewed for the last 4 years. And what is included in flow business to say that there are activities recurring and are stable, mainly long-term service contracts, maintenance [indiscernible], et cetera, that are usually renewed and small and medium contracts with a recurrent and diversified portfolio of clients. Next slide. Well, remember, Cobra IS born in flow business, some of our companies have been doing these activities for more than 80 years, like Cobra, created in 1944 or [indiscernible] Siemens that are more than 1 century old. Some historical examples. For example, CIC installed the first traffic light in Madrid in 1926 or [Siemens] that started working in the electricity grid in the Northwest of Spain in 1929 [indiscernible] in 1950. And what about the future? Well, the future looks bright for Flow business. Thanks to be present in all the value chains of our project, as you saw in the previous presentation by Jose Maria and thanks to the expertise of more than 80 years working on this, our flow business activities will benefit of the winter coming from the electrification of the world, its interconnection and the common goal to reduce the emissions and increase energy efficiency. Some examples of what I'm saying, to give service of the electrification of the world and the global grid is expected to reach outlook, sorry, to grow 80 million kilometers up to 2040 or the global objective of the electrification of railways that is expected to reach 60% of the lines in 2030, while now it's around 45%. And also the need of communications where EUR 2 billion are expected to be invested in the following years to increase the coverage of the 5G technology in mobile and optic fiber network. Only Germany seems to -- is going to invest around EUR 50 million. Considering all of this and the expertise, background and know-how of Cobra IS in this field, we should be an important actor not only in the construction of all of these infrastructures, as you will see in the next presentation, but also in the operation, maintenance and works related to them. Next, please. We have presented our origins, how the future looks, but what we're doing with Flow business? We have a very wide range of different activities that we categorize in three groups of activities that are well balanced between each other in terms of revenues. First, we have the networks, which represents a 32% of the LTM revenues and are mainly long-term service maintenance installation contracts for utilities or public administrations. In this category, we include the service we provide to utilities in the distribution networks, mainly maintenance with clients like [indiscernible], EVP, [indiscernible] in Spain, the maintenance and operation of the publicizing. These are also long-term contracts with municipalities where we are in charge of the core executioning of the [street lives ] of a town or a city. And distillation and maintenance of communication networks, both fixed and mobile, working among others for Telefonica, Orange, or Vodafone in different regions like Spain, LatAm or Europe. Then we have our facilities. It represents the 40% of LTM revenues in small and medium projects with a very diversified portfolio of clients, many of them with a long-term relationship as facilities we consider. Electrical installations and maintenance. This category includes a wide range of different works. We can do the electrical installation of a building and for the installation of a substation in a PV of [ photovaltic ] plant for the evacuation of [indiscernible]. Mechanical installation and maintenance. As electrical, this one also includes very different works. Going from the cooling and the air condition installation in, for example a hotel, to the assembly of a turbine in a power generation plant. And at last, railways, this category mainly includes the installation and maintenance of the catenary overhead lines and work related to signaling and security of the railways. And then we have our last category that is contra systems with a 20% of LTM revenues includes the most technological activities of the group, traffic control, both urban or interurban, channel security systems, installation and operation of toll systems in PPP highways, installation of tech ticketing systems in public transport and technology for Smart Series. Next, please. And now in this slide, we want to show you what we are doing with these activities. As I mentioned before, our main countries in Spain, where we do more than half of our flow business activity and where we have the biggest portion of our backlog around 60%. Besides Spain, we have our historical [geographies] for example, Portugal, where [indiscernible], 1 of our 15 groups is one of the main companies of the country in flow business. And LatAm, of course, with countries like Peru or Mexico, where we have been working for more than 25 years and in some activities, we are recognized as locals, not as a branch of a Spanish company. Nevertheless, the 65% of the flow business activity comes from Spain, Portugal, Mexico, Peru and Chile. But also the international footprint of flow business out of these historical geographies is growing. It's growing rapidly. Geographies like Europe, mainly Germany and Italy, where we went first with our communications activity. And now we are doing other works, the distribution networks or electrical installations. North America, mainly in the United States, where we are present with our control systems, working on traffic control and security systems for privates, or subcontractors for this scopes. But also for some DOTs like the one of Texas or Florida. Next, please. And now you know where we are and what we do, but how we do it? While Cobra IS [indiscernible] player in flow business activities. We can summarize it in 5 bullets. First, client knowledge and trust. We have been working with some of our clients for [indiscernible]. The trust and knowledge of each other is a key factor to continue doing things with them and also following them to new countries. As an example, there is an important client for us that when he goes to a new country, always try to contract local companies, but not only for one time, after that experience, they call us to do the work. Market tailored know-how. After more than 80 years doing flow business, we have an expertise that allow us to adapt ourselves to the new requirements of the markets and of our clients. In-house developed solutions, we have the capability to adapt our companies to the requirements of the markets, and we do it internally. We don't go to M&A to find a company to serve those requirements. We and our teams evolve to adapt our work to the new needs of our activities. Operational excellence, key to we are a [relevant] actor in the world of low business activities. We try to reach the excellence in every work we do. Thanks to this excellence, your client will trust you and will give you more workload. Thanks to this, we could be considered as one of the best-in-class inflow business. Leadership and track record. This last bullet is a summary of the other four. Leadership is reached thanks to our expertise, our experience, the trust of our clients on our capacity to adapt to the new requirements of the markets. All of this is possible, thanks to a strong risk management, as explained before by Jose Maria [our CEO]. We know what we can do, which are our capabilities and what we can sign with a client. We don't feel shame refusing contracts. If the conditions are not aligned with our risk profile and our capacities. About diversification, Cobra IS business is very diversified. By how? You saw in previous slides that Cobra IS is very diversified in activities. We have a wide portfolio of them. But not only in activities, Cobra IS is also diversified in clients and contracts. Those EUR 4 billion are done through more than 7,000 contracts. These are the number of actual ongoing contracts, I mean, contracts with revenue in the 12 months ending September '23. And most of them below EUR 1 million, a 78% doing a math EUR 4 billion and 7,000 contracts gives you an average of EUR 600,000. And also diversification in clients. These 7,000 contracts are done for more than 1,300 different clients, in which the top 10 only accounts the 19% of revenues around EUR 800 million. And who is included in this [attempt], Telefonica, our historical client in communications. We are working with them in the last 40 years, in countries like Spain, Colombia, Peru, Argentina, Chile or Germany. [indiscernible], another example of recurrency and stability, also working for them during 40 years. Work in Spain, the Northwest of Italy, Peru, Chile or Argentina. [indiscernible], the public operator of the railways in Spain also working for them for at least more than 30 years. [ Red Electrica ], the operator of the transmission risk in Spain, also a very long-term relationship. But not only this long-term relationship clients, we have also new comers, like, for example, Amazon, who we are working for them 5 years ago doing the installations of a logistics terminal in Toledo in the south of Madrid. And for now, we are working in data centers in Spain or Germany or last [indiscernible] groups, one of the new German utilities for optic fiber. About the type of clients, the balance is 66 private, 34 public. We know that the speed in public in administration and public companies is not far from 50 each as it is also in the privates, when you split them in service and manufacturing companies. Next, recurring and predictable performance. Insisting in this -- in the recurrence and the predictable performance of our flow business, these two concepts are key to understand our activities. I mentioned at the beginning of the presentation that our flow business includes long-term service contracts that allow us to have certain visibility in the future performance of our activities. Well, these kind of contracts represents about 45% of the Flow business revenues. And what about the short term? What brings us that visibility, the relationship with our clients. As I mentioned before, some of them working for -- with us for the last 40 years. So they trust us and that allows us to have a continuous activity with them. Okay. Now that you know I explained before, that we divide our activities in three groups, network facilities and control systems. In the following slides, we are going to deep dive in each one. Starting with Networks. Remember, 32% of the LTM revenues, they are mainly long-term service maintenance and installation contracts our main work in these activities are related with distribution networks, where we maintain them and the related installations, including lifeline works. This means who works in the transmission line without this connected funding rate. In distribution, we are present into the different works that need to be done by Agility from the resolution of a problem of an [indiscernible] availability of a trench of line to connect a home to the distribution network. Gas water networks, where we maintain a developed related works and installations in the distribution of water and gas, including the pipeline network of a city and the maintenance of big pipelines, like the one between Spain and Morocco for the transport [indiscernible] that we have been maintaining in the last 25 years. Communication networks where we have the capacity to do the whole process from the installation of the optic fiber network in a city bring it to the home and go inside the home, finishing the installation with a router of the final client of the company. And public lighting, where we maintain the public lighting of the cities, for the municipalities and where we try to improve their efficiency. This kind of contracts, the public lighting, just to have a duration of 10 years. And also sometimes, they include a bonus on energy savings as we have to improve the energy efficiency of the lighting. Most of these activities are done in critical infrastructures of a country. This means that the clients look for stability in their suppliers, trying to not to change them is the quality of the service, match the requirements. Next, please. Some examples of what I have already explained. In the distribution networks, we have the maintenance contract we have with Endesa, the Spanish subsidiary of Enel for the last 40 years, covering different areas of Spain. Catalonia, Andalusia, Baleares and the Canary Islands. Our relationship with [indiscernible] doesn't finish in Spain. We are the partners in distribution in many other countries in LatAm or in Europe. In these distribution networks, Cobra has this kind of service contracts in 15 countries, mainly in Europe, Spain, Portugal, Germany, Italy or Netherlands and LatAm Mexico, Panama, Peru, Brazil, Chile or Argentina. In all these countries, we are doing an average of 42,000 breakdowns and 44,000 operations per month with around 5,000 employees. In public lighting, our main contract and the figure you can find in Spain is the maintenance of the lighting of the city of Madrid. This contract into different phases is being provided for more than 10 years, giving us reference to reach similar contracts in other regions and cities on around the [indiscernible] of Spain. And in communications, that we are showing you the FTTH, fiber-to-the-home, contract with Telefonica in Spain, another very long-term contract is an example of our capacity to adapt ourselves to the change of markets. We have started working with Telefonica in the '70s with Cooper Lines, changing to optic fiber in the 200 being Cobra the responsible of installation of about the 35% of the optic fiber network in Spain, a country where more than 90% of the land is covered with optic fiber. As a rough number, we estimate that we have installed around 28 million kilometers of optic fiber around the world since we started. Actually, we are working with communications in 10 countries between Europe and LatAm. After this explanation and before going to facilities, we will show you a short video with an example of our works in distribution networks. This video is from a [rehabilitation] of a tranche of a transmission line in Brazil, an important geography to our business where distribution contracts are growing rapidly. This work were done for [indiscernible], an important operator in the country, and the project consisted in the rehabilitation of 10 kilometers of transmission in a very complicated area located in a natural park where we did big efforts to secure the environment, [indiscernible], for example, helicopters to transport people and materials rather than use conventional transport to not to deforest the land. [Presentation]

I don't know if you have seen the last sentence of the video, this was written in Portuguese, sorry. But it was saying three key things for us. We finished the project in time, with quality and without accidents. Okay. After this video, I will move to facilities. These activities represent the 40% of the Flow business revenues, and these contracts are more related to works and maintenance of installations as facilities we find, electrical installations and maintenance, including the installations in different sectors and areas like buildings, data centers, factories, et cetera, and the construction and maintenance of substations. Mechanical installation and maintenance. These activities are related to the mechanical part of the installations of a building, factory, including cooling, air conditioning or fire protection. Mechanical assemblies. In this category, we include works related to the installation of different parts of a big project, for example, the installation of a new boiler in a combined cycle plant or the work we could do in the construction of ships by [indiscernible]. The railways installations. This category includes the catenary and all the electrical parts of electrified railways and works related to the signaling and security systems of the railways regarding the security systems, it is important to remark that we are finishing the development of our own ERTMS, the European Training Control System that will go to testing phase pretty soon. Some examples of projects in facilities. We have an electrical installations, the execution of the substations of Campos and [Matalan] in Spain. These substations will serve as the evacuation of photovoltaic plants with a total capacity of 650 megawatts, including a short range of transmission to take the power generated by those plants to our [ Redenectrica ] substation. Our experience with substations allow us to work in many different countries like Mexico, where we are working in the substations of the [indiscernible] or in the Emirates. But also, we can use this knowledge to make these installations in our EPCs of transmission as they could include not only the line but also the substations or in the EPCs of renewable energy to do the valuation of the power for our own developments. In mechanic and installations, we have the mechanical iterations of the same Regina hotels in Cancun, Mexico. These projects include all the installation of the air conditioning and cooling systems of the resource as well as the installation of the fire protection system. This is a typical example of the projects that Cobra IS developed in facilities. In this case, this is a medium-sized project without a long-term duration, but we helped with our experience in these kind of projects, we can have certain recurrence in time. As we have done this kind of works in many hotels in the Caribbean coast, as well as in Spain or countries like the Ivory Coast. And in railways, we have the installation of the overhead lines for the higher speed trains in Madrid. Cobra IS has been a relevant actor in the construction of the high-speed network in Spain, starting in the 90s without the stop. And not only we make the installation of these overhead lines of catenary, we also are responsible of the maintenance of these overhead lines around Spain with a contract that started in 2015. Next slide, please. In Control Systems, we are mainly integrators of technologies in service of the control of the traffic, the tunnels, signaling and security. This means that we develop the software that allow the control of all the different systems to warranty the proper and secure functioning of the traffic in a city, a highway or a tunnel. Also these activities includes works of installation of toll systems in a PPP highway or ticketing systems in bus, tram and metro networks and the operation, including the payment method with integration with a payment platform. And at least, but not less important, the work we do for the integration of the different service needed to run a smart city, including activities of the other groups like [indiscernible] , et cetera. In Control systems, we can find long-term service contracts. The operation of traffic of a city, for example, in some of them in Spain, we have been doing the operation of the traffic for the last 40 years like Valencia. But also specific projects for the installations of the ITS of a tunnel. These specific projects also used to have a shared time period of time for the operation and/or maintenance. Next, please. After giving you, I hope, a more clear visibility of our control systems. In this Slide, you can find some examples of these contracts. For example, the maintenance and operation of the M-30. We've been doing this maintenance and operation for the last 25 years, but also during the last 15 years after the big remodelation that suffer the M-30 that is the first ring of [indiscernible] , including the construction of 30 kilometers of tunnels. In this contract, we are the responsible of the management of the traffic, including the assistance of the different emergencies that can occur in the road of these characteristics with more of 1.5 million vehicles driving everyday through it. The other example is the ticketing installations of the light train in Guadalajara in Mexico, in this contract, we are in charge of the installation of the control center, the connection center and all the infrastructure needs for the ticketing in stations around 30 and in the trains. This contract also includes the operation and maintenance of the systems and the operation of the collection and deposits of securities. The last example of this control systems is the control system of a tunnel and will be explained with the following video related to the work we are doing in the WestConnex channels in Sydney, Australia. In this project, we are doing the installations of the ITS that is the intelligent transport system and integrated management systems of the tunnels with SIDERA. And what is SIDERA? SIDERA is a software developed by SICE, one of our subgroups that offers a comprehensive solution for the centralized management of this ITS and tunnels based on each project requirements. So the SIDERA may vary from one project to another based on what is needed in that project. SIDERA currently managed all the ITS equipment of over 2,500 kilometers of open roads and over 300 kilometers of tunnels. This is another example of recurrence and trust of our clients. We make the installations of the software of the SIDERA of the first tunnel done on in the WestConnex, being a subcontractor of the JV responsible of the construction of the project. And the final client decided to recommend us to the other works of construction of the different tunnels that are included in the WestConnex. So please, the video. [Presentation]

Okay. And after the video and at least a summary of conclusions that we can take from our flow business activities. First, deeply rooted local presence based on more than 80 years of experience -- of expertise, sorry. We are quite old in this business, but we are only in age, not in mind. We keep on working to grow our business and increase our profitability. This expertise allow us to grow in different markets carrying with us the know-how we got in all this experience. And also, the experience we have in some countries, as I mentioned before, allow us to say we are local. We are proud of being considered Peruvians, Mexicans or Brazilians. Significant growth prospects. There is a grid we entail around electrification. This not only means a lot of work in the construction of the big infrastructures. But there is also a great opportunity for all that actually works around those infrastructures and their maintenance. Recurring and predictable revenue stream. Thanks to our great diversification in clients, more than 1,300 and in contracts, more than 7,000 with an important portion of them, 45% that are long-term service contracts. And a longer relationship with our clients, working for them in some cases for more than 40 years. Industrial leading margin. We are solid doing for business. And thanks to our risk management and looking for the excellence and quality of the service we provide, we could be considered one of the best or the best in class in flow business activities. Tailor-made offering technological and innovation excellence. We have the ability to adapt ourselves to the change of markets. That's the main reason on being in this work during 80 years, including the last technologies in our work to reach the quality required by our clients and excellence in our services. And high people retention. You know that these activities are very intensive in workforce. 30,000 people of our 42,000 employees working flow business. Rotation of people is complicated, but not impossible. Of course, or companies we suffer rotation. But we can say that the key people to carry on these activities fill Cobra IS, as their own company. And they work for, of course, their own benefit, but also the benefit of the company and the benefit of our shareholders. Okay. And after this, I will give the floor to Raul Llamazares, the CEO of Intecsa, to explain you the EPC projects.

Good morning. My name is Raúl Llamazares, CEO of Intexa Industrial, one of the subsidiaries of the Cobra IS. I've been told that as [indiscernible] mentioned, my experience in EPC contracts. So I've been working more than 30 years in this market, the last 23 in group, executing projects all around the world. For example, Mexico, Costa Rica, Peru, in Latin America, Spain and Ireland in Europe. The United Arab Emirates, Saudi Arabia and [indiscernible] in Asia, and Morocco, Algeria and Egypt and Africa. It's for me a pleasure to be here today to talk to you about EPC business in our group. Over the next 10 slides, I'll show you that we have decades of track record successfully delivering industrial complex projects. We are living an extraordinary clean energy production expansion. And Cobra IS is uniquely placed to capitalize on this energy transition because our expertise and track record our uncompromising procedures and our standing management team and employees. First, since I don't know if all of you are familiar with the EPC term, allow me a very brief description of what an EPC contract is. EPC is an acronym that stands for engineering, procurement and construction, the main 3 phases to build an industrial plant. In the Engineering phase, all the technical disciplines work together to produce the optimal design that strikes the balance between budget and efficiency. Procurement involves purchasing, inspection and transportation of all the materials and equipment specified during engineering and required for construction. Finally, during construction, the facility is built in accordance with drawings and specifications reduced during the engineering with the purchase of material and equipment and ensuring that all the activities are performed safely and accretively. And EPC contractor works under a single contract with a project owner, executing all project spaces from the start to finish. To complete a capital project and assumes the risk of being responsible for completing a project with a specific scope of work, fulfilling the quality standards and technical specifications in a fixed period of time, and achieving a required performance specifications, such as net megawatts in a power generation plant, proven through the performance and reliability test carry out once the facility has been built. Now going what this slide shows. In 2021, our backlog in EPC contract was EUR 4 billion, which represented at that time, 48% of the total backlog of the group. At the end of last September, the backlog was almost EUR 10 billion, around 2.5x larger. This EUR 10 billion represents exactly 67% of the total backlog of the group. To complete this information, let you know that these figures don't include another 2 offshore energy conductor platforms that the group is going to build and install in the North Sea, which will mean another additional EUR 2.7 billion, therefore, our present EPC contract backlog exceeds EUR 12 billion. The comparison of this backlog with the revenue from EPC contracts in the last 12 months, that has been EUR 2.1 billion [indiscernible] of its dimension. Cobra IS not only has one arm to approach EPC contracts. There are 8 subsidiaries of the group that have been or are in both in EPC contracts in different sectors. So imaging Cobra as an octopus with 8 arms with a common head. This common head is our risk policy. I'll talk about it later. Well, the name of the arms are CYMI Brazil, Dragados Offshore, Intecsa Industrial, Makiber, Cobra, CME, SEMI and Maetel. This vast array of companies has executed contracts in 28 countries and has approximately 10,000 employees directly in both EPC contracts execution. On the right-hand side, you can see the multiple sectors where Cobra has been and is active in EPC projects. Renewable power plants in many of its different varieties, such as wind, solar, hydroelectric, geothermal, biomass and in the near future, biomethane. Power transmission lines and substations, water facilities, both desalination and water treatment plants. Conventional power plants such as open cycle combine-cycle anchor generation plants. Another sectors such as waste treatment plants, fertilizers production plants, oil and gas, LNG, petrochemical and mobility. Next, please. Cobra IS has been a first mover in renewable energies, and this sector will be a huge market in the years to come. According to the International Energy Agency's net survey emission scenario by 2050. And as you can see on the slide, there will be an extremely ambitious transformation of the global energy system. The path to net zero means a huge decline in the use of Fossil fuels and requires immediate and massive deployment of all available clean and efficient energy technologies. And makes the 20s and the next 2 decades, a period of massive clean energy expansion. Instead of fossil fuels, the energy sector is based largely on renewable energy. More than 2/3 of total energy supply in 2050 is from wind, solar, bioenergy, geothermal and hydro energy being Solar, the largest source. According to our recent International Energy Agency's report, the necessary worldwide CapEx to build clean energy generation facilities will be USD 1.6 trillion per year which means triple the CapEx used in 2022. On the other hand, worldwide CapEx needed to install or retrofit existing transmission and distribution lines will be USD 600 million per year, which means double the CapEx used in 2022. This scenario, and it's -- it's been in the past, Cobra IS will be a very significant player to install new renewable capacities in the years to come. From data about our contribution so far are more than 100 [indiscernible] plants built totaling almost 6 gigawatts, 13 Thermosolar plants built totaling 730 megawatts, around 90 onshore wind farms built totaling more than 2.8 gigawatts and close to 30,000 kilometers of transmission lines installed in Brazil. Cobra is present in the transmission lines market in Brazil since 2002. Being one of the main contractors and developers in the country. We have developed 39 transmission projects with a total length of 20,400 kilometers with a total CapEx of EUR 2.4 million. Another close to 9,000 kilometers has been installed for others. Trying to replicate this business in other countries, we are now looking, for example, towards Australia. The sexy Australia. This is not combined cycle. This is the transmission lines. A country with huge needs of transmission lines to transport the power from renewable new renewable power production plants to where it is consumed. As a first step, recently, we have been awarded the design, construction, operation and maintenance of 217 kilometers of transmission lines and one 500-kilowatt substation in New South Wales. We hope that the contract will be signed shortly. Finally, Cobra has been an early mover in the HVDC, high-voltage direct current market with an offshore energy converted platform in the North Sea. As a result of the present different conflicts in the world, some European countries are urgently looking for energy sources that make them less dependent on foreign countries. One of them, the offshore wind. An investment in offshore wind farms are associated to investments in HBDC platforms, as you will see later in the next presentation. To be a first mover in a market like this, with a lot of expected investments and with reduced competence will give us the opportunity to get very good margins in the coming years. Next, please. This slide shows the last 12 months revenue and the present backlog both by sectors and by geographical orders. By sector, as you can see in the pie chart above on the right, Renewables contribution to the last 12 months revenue has been 47% of the EUR 2.1 billion, followed by power transmission with 29%, other sectors with 15% conventional power plants with 7% and water facilities was 2%. In our almost EUR 10 billion backlog, Renewable energy represents 66%, followed by power transmission with 16%, water facilities with 7% other sectors with 6% and conventional power plants with 4%. Renewables is clearly the sector that is driving our EPC business. By geographical areas, if you look at the pie chart on the bottom right, you can see that in the last 12 months revenue. Central and South America has reached 53%, followed by Spain with 25%, Europe exclude Spain with 12% and the rest of the world, 10%. In our backlog, the scenario is different. Europe excludes Spain represents 55%, followed by Central and South America with 27%, Spain, 14%, and the rest of the world, 3%. Clearly, the present leadership of Central and South America in our revenue will change to Europe in the coming years. Next, please. Regarding Cobra IS factors that we think contribute to a successful completion of an industrial facility. I would like to highlight the following. Number one, more than 50 years of experience of global reach and local knowledge. Although in the EPC market, we can cover the 5 continents. There are countries in which we are permanently established. And therefore, we have local capabilities. And if not, we will join hands with other companies that may have them. Number two, risk mitigation. Here, the key word is selectivity. It's not the first time that you hear this word today and is not going to be the last. I'm afraid. We are extremely careful with the selection of opportunities that we decide to pursue. And before the contract signing, we enter into detailed contract clauses negotiations with the client, and it's also the time to consider the possibility of an appropriate partnership. Number three, highly experienced teams. Due to our many years of project execution, we have very the experienced teams and specifically in the role of project director, which we consider a key figure to execute a busy contract. Anyhow, there is a continuous follow-up of the projects under execution by the top management of every company. Number four, operational excellence. We can develop the engineering with our own in-house capabilities or count on outsourced engineering skills, but closely monitor. The same happens with the construction capabilities. All the procurement as well as all the project control activities are carried out by our own staff. Number five, excellence of procurement. We have a worldwide procurement network and the diversification of suppliers with a close expediting and averted inspection. In a medium-sized project could be more than 60 purchase orders of electromechanical equipment and material. Whose value can reach the 50% of the project budget. We purchase from simple bolts and nuts to reactors or turbines that weigh more than 500 tonnes, which is the weight of more than 300 cars. Number six, tight project control. In order to warranty the completion of a project within the time established in the contract and in our budget, continuous monitoring of the critical path costs and cash flow is essential as well as analyzing at all times situations that may represent a risk and implement the necessary mitigation measures. Next, please. We currently have 88 projects in execution, we look into 50 medium and large projects with a value above EUR 50 million and 38 small projects with value below EUR 50 million. The breakdown by sector of the projects we are executing is 34 projects on renewable power plants, 19 projects on transmission lines, 15 projects of water facilities, 13 projects of other sectors, 4 projects of our oil and gas plants and 3 projects are conventional power plants. As you have seen, it's important to point out that Cobra has a very high diversification in its EPC contracts, either by sector, by regions, and by size of the projects with a clear trend in the future towards more than 60% of revenue coming from renewables and around 70% coming from Europe, including Spain. Now let me tell you how do we go about successfully, selecting and executing projects. This is the Cobra's Nuance or secret recipe, so to speak. The first step and the first decision to make at every subsidiary level is bid or no bid. We strongly think that an essential condition to be able to complete the project successfully, is to do a very detailed and complete job during the bidding stage. This requires many resources and it's costly. So it is necessary to be selective with the deputations to beat, which we want to accept. Some key factors to consider before making these decisions are, of course, the client we have previous experiences not if it's an industrial profile, what is its solvency and what warranty of payment they can provide. Country, we are working or we have worked there or it's a new country, what is the social and the political stability, et cetera? Of course, what is the scope? And hence, what is the size of the project? What is the required technology, 3 important questions on this matter? Is it a client or is a contractor selection? It's a well-known technology or it's a new technology? And what's the responsibility of the EPC contractor in this regard? Very important, the main contractual terms. To be sure that they are not trespassing our red lines. For instance, maximum liability, the LDs cap and direct damages or loss of profit and what are the required bank warranties and what is the applicable law? And consider if it's appropriate our partnership with another company that could add value to the project distribution and the form of this partnership, joint venture consortium or even nominated subcontractors. If the final decision is bid, the bidding process begins. And it is our job that can last from 3 to 9 months or even more depending on the scope of the project. After carefully tendered recommendation analysis, our tailor-made works start with the target of evaluate necessary engineering or project management manhours. Issued the minimal equipment technical specifications to get equipment rotations. Issue a minimal material bill of quantities to get material, rotations and construction subcontractors quotations. Develop a detailed schedule and cost analysis, make a detailed risk analysis and established mitigation actions. And finally, conclude a partnership agreement if there is a partner. I would like to highlight again that a good bidding work is crucial to have a chance of successfully complete an EPC project. A bad and poor work during bidding time, warranties a failure. Either because it's not a competitive bid and therefore, the offer is not considered by the client or because being awarded, the execution is unsuccessful for sure. Once the bidding phase is in advanced stage, projects offers of more than EUR 50 million must pass the filter of Cobra's Risk Committee, which is chaired by Jose Maria Castillo. This limit is lowered to EUR 10 million, if there is no previous experience in the country in which the offer is made. With the probable of this committee, the subsidiary can deliver the offer unless the offer is more than EUR 80 million, in which case, it must pass a new filter. This additional filter is the benches Risk Committee, chaired by the President and the CEO of the group. Only once the approval of this committee has been obtained. The subsidiary can proceed with the delivery of the offer to the client. During the pure execution stage of the project and after issuing the tailor-made project execution plan, we monitor on a monthly basis the progress of the project. In case of any significant delay, we are forced to establish catch-up plans. As I said before, to warranty the completion of a project, within the delivery time stated in the contract and in the budget carried out by us, a continuous monitoring of the critical path cost and cash flow is essential as well as analyzing at all times new situations that may represent a risk and implement necessary mitigation measures. At this point, I'm going to tell you a case in which it's demonstrated that our serenity and selectivity and not just words, but rather facts. And this is not the case in which we declined to beat, but it's a case in which we declined to sign a contract. In December 2018, we delivered an EPC offer along with some terms agreement to convert an existing open cycle power plant in Colombia, to a combined cycle, project sites around USD 200 million. 3 months later in March 2018, we were nominated as a preferred bidder. Even in June 2018, we were awarded with an early works to start engineering while we were negotiating the contract clauses of the EPC contract. The client together with its advisor law firm from New York, try to impose contractual terms and conditions that unduly put risk on us. One of them was that the client didn't accept force majored cases outside Colombia to have the right to an extension of time in the contractual time for completion. After months of hard negotiations in September 2018, we didn't accept the client conditions and declined to sign the contract. Contract in which we were very keenly interested at that time. Some weeks after the contract was awarded to another EPC contractor. By the way, Spanish. Who accepted all the clients' conditions that we have rejected. And all of you know what happened in 2020 with the COVID pandemic. Imagine the delay in the delivery time of all the equipment and materials, most which had to be manufactured outside Colombia. At present, 4 years later, with 2 years of delay, the project is not totally finished, and the contractor is claiming and successfully. For the right [indiscernible] of time, which is not in the contract since force majeured cases outside Colombia were not recognized in the contract for that. Next, please. In the next 3 slides, I'm showing some of the most recent EPC contracts, some of them are still in execution stage. For renewable power plants. Top left, you can see a biomass power plant built by Cobra in Japan. To its right a photovoltaic plant built by Cobra in Spain. Bottom left, an offshore high-voltage direct current connection built by Dragados offshore in Spain and transported to German North Sea. Bottom right, our wind farm built by SEMI in Chile. Next, please. Transmission lines projects, La Nina in Peru, 354 kilometers installed by Cobra. Redenor in Chile, 273 kilometers installed by Cobra. Pampa in Brazil, 326 kilometers installed by SEMI. Chimarrao in Brazil, 1,150 kilometers installed by Cobra and SEMI. Next, An example of water facilities is the Taboada wastewater treatment plant that Cobra has built in Peru. Examples of conventional power plants are the 1,000 megawatts combined cycle power plant that Intecsa Industrial is building in Talimarjan in Uzbekistan. And the 870-megawatt combined cycle power plant that Cobra is building in Belgium. Finally, and in the mobility sector, you can see below on the right, the picture of the Femern tunnel. 18 kilometers of 40 meters below the surface of the Baltic Sea tunnel for road vehicles and for trains between Germany and Denmark. The scope of work of SICE and Cobra is electromechanical installations and instrumentation and control systems. Next please. To conclude my presentation, some key takeaways about COBRA IS in the EPC world. We have understanding track record to execute large and complex EPC products worldwide. We are the first mover in several markets, thanks to our technical expertise and innovation. Which is a considerable advantage. We are very well positioned to be an important player in the energy transition. We carry out an operational risk management to execute our projects with known and measured risks. At present, we have, as Jose Maria said, an historical record backlog. That is not the result of an unbounded ambition of getting contract at all costs. On the contrary, this backlog has been the result of our visibility and has been achieved without losing in any way, our serenity and selectivity. And finally, the last takeaway session management teams and skilled workforce. This is the last in the list, but likely the most important. Our people are our most relevant asset. Their knowledge, combined experience, enthusiasm, and entrepreneurial spirit have allowed Cobra IS and its subsidiaries to become a global renowned contractor brands. That's all. Thank you very much. I pass the word to the next speakers, Pedro Ascorbe and Cristina Sanz, President and CEO of Dragados Offshore.

So are you ready Christina?

Hello. Good morning, ladies and gentlemen. My name is Cristina Sanz. I am the Dragados Offshore, Vice President, Operations. I'm working in Dragados offshore since 2003.

Good morning, ladies and gentlemen. My name is Pedro Ascorbe. I am the Dragados Offshore President. I am working in the Dragados offshore since 1998. It is a pleasure for us to share a few minutes with you today during our presentation of Dragados Offshore and its activities. Dragados Offshore started its operations in 1972. And since then, we have grown in the sector of the oil and gas and wind offshore industry. Dragados offshore is a reference EPC contractor with a solid track record ensuring our clients that the projects will be successfully planned, executed and delivered.

Our operations are centralized in Spain and in Mexico. Our logo and slogan is building excellence worldwide. Excellence means to deliver with the right product, right time, right budget and always with safety first, a full satisfaction of our clients.

As a consequence of the award in construction with Siemens Energy of 9 HVDC offshore wind platforms to be delivered to the German and Dutch sectors. Since 2022, 2023, there has been a drastic shift from offshore oil and gas to renewables. The converted amount per year has increased from 0.5 to 0.7 to 3.0, 3.5, which is approx 500% increase. Estimated revenue will increase from an average of EUR 0.2 billion in 2020, 2023, up to EUR 1 billion in 2024, 2029. Again, approx 500% increase. We would expect to maintain our estimated operating margin, which used to be double-digit under a constant flow of profitable growth. In total, so far, almost 14 gigas and more than EUR 8 billion our share. The breakdown by client is for Tennet. DolWin6, 0.9 gigas, and handed over 2 months ago to Tennet and now in commercial operation. BorWin5, 0.9 gigas, awarded in June 2019 and currently under construction in Tennet. LanWin2, BalWin3 and LanWin4 2 gigas each awarded in June 2023. We DolWin 605 were awarded before Cobra acquisition by Vinci. After Tennet for Amprion BorWin4 and DolWin4 0.9 gigas, each awarded in July 2022. BalWin1 and BalWin2, 2 gigas each awarded in February 2023. In summary, and this is very important for us, work load and slots until 2031, an approx EUR 1 billion revenue per year. Sincerely, Christian and I have never seen this in our many years of experience in Dragados offshore. The future, the future is even more promising, exciting and with plenty of good opportunities with more than 60 gigas already identified and a sustained flow until 2040. Targets scheduled by country are so far. Germany and the Netherlands, 22 units of 2 gigahertz from 2035 to 2040 for TenneT, Amprion and 50 hertz. The U.K., 7 units of 1.8 gigas to be tendered in 2024 for National Grid. France, 4 units of 2 gigas to be tendered in 2024 for RTE. There's also a very promising potential expansion to the U.S. capitalizing our Mexican yards for execution. Having said this, and as Jose Maria Lacabex has indicated, we will not compromise our future with risky projects. We have enough profitable work to execute the next 10 years.

To perform all these current and future challenges as a reference contractor we have numerous market opportunities. One of few players worldwide since the competition is quite limited. Pricing power during contract negotiation, very important, as mentioned before by Jose Maria, the risk processes. We apply integration measures and flexibility, efficiency by repetition, learning tools and working by faces and long-standing partnership with Siemens Energy. Next slide, please. So as Pedro mentioned before, we have workload and visibility until at least 2031. This is, as you can imagine, very, very important. To face these workload and slot until 2031, the Dragados Offshore currently has 4 yards in operation, 2 in Spain and 2 in Mexico. This gives us an essential competitive edge in respect to our competitors. In Spain, we have Cadiz yard that is where the Dragados Offshore headquarters are located. The Cadiz yard is the largest offshore construction yard in Europe and has more than 50 hectares and 580 meters long. Field expansion will add approximately 23 additional hectares, the units, DolWin6, BorWin5, DolWin4, BorWin4, BalWin1, BalWin2, and LanWin4 will be built in Cadiz in Algeciras. This is a future expansion in Spain for additional integration capacity to deliver 2 giga HVDC platforms. It has 45 hectares and 250 meters length. The units LanWin2 and BalWin3 will be integrated in Algeciras. In Mexico, we have 2 yards, Tampico yard and Altamira yard. Tampico, with 35 hectare and 2 long main key and Altamira with 40 hectares and 1 key. Our facilities in Mexico are currently complementing the operation in Cadiz with the fabrication of different offshore components.

In the U.S., indications are that in the very near future, the HVDC offshore wind industry will also grow like in Europe and with our facilities in Mexico, we cannot be better positioned to face this market. Next slide. The objective of an HVDC platform is to increase the voltage and convert electricity receive from the wind turbines from alternating current, AC, to direct current, DC, to reduce losses to the transmission from offshore to onshore. When the offshore distance between the wind farm and the [ combustion ] station is more than 80 kilometers approx. The investment in conversion and HVDC technology is economically justified. If the distance is less than 80 kilometers, then the HVAC technology without conversion and, therefore, more economical than the HVDC is the right solution.

The offshore grid is crucial for ensuring the energy supply to Central Europe. The offshore converter station is the heart and will transform and convert the energy generated by the offshore wind turbines from 65-kilovolt high-voltage AC to 525-kilovolt high-voltage DC, to minimize energy losses when the electricity is transmitted to onshore via subsea cable. In the onshore converted station, the DC current will be reconverted to AC current and finally, injected to the onshore network. The technology ensures an efficient [ HBDC ] transmission. Dragados Offshore scope of work includes on the engineering of the complex platform, including all the phases, concept, basis and retail design, procurement, construction, transport, offshore installation, trial run and start-up of the facility. Work highlights that exclusive agreements are in place with the company all sets to perform the transportation and the installation of the unit BorWin5, BalWin4, BorWin4, BalWin1 and BalWin2. We will use the pioneer spirit and main factor for this installation unit that is one of time vessel are; the total length, 477 meters, being 124 meters, draft from 12-meter to 27 meters, and total lifting capacity 8,000 tons. The 2 giga platform weights and dimension are the following ones: weight, the platform, 27,000 tons, the jacket 13,000 tons for your reference times for Eiffel tower that has a total weight of 10,000 tons. In dimension, the model is bigger than football field with 100 meters time 77 meters and 10 floors with a total height of 41 meters. Regarding the workload. 2 giga platform requires approximately 3,000 workers and 2 millions of productive manhours. For your reference, one of these 2 giga platform, has power enough to feed a city of 2 million people.

Finally, we would like to show you a short video of about 3 minutes of the DolWin6 project, which was handed over to TenneT 2 months ago and which is now in commercial operation. And as such, with 0.9 gigas, feeding approx 1 million people with electricity built in Cadiz by Dragados Offshore.

We indicate you the following dates associated to this project. DolWin6, the contract was awarded in August '17 -- 2017, offshore installation in August 2022, fuel production and handover to TenneT in September 2023. Besides the COVID, the project was concluded on safety, on schedule, meeting all the milestones and a full satisfaction of the client and all the parties.

We really hope you like the video. [Presentation]

The next presentation will be carried out by our colleague, Bautista García, who has come from Peru, to present all of you the Talara project. Thank you.

Hello to all of you. My name is Bautista Garcia. I have been working in Cobra for more than 20 years. I have been responsible for a large EPC project for many years in different positions, like Construction Manager, Sales Manager, Project Manager, [indiscernible] Dragados. Currently, I am the operational Head of Industrial Plan and Energy for Cobra. The Talara refinery project is a typical EPC project like is explained with my colleagues, Raúl Llamazares, which we -- is accounting -- Peru, we know perfectly. It's a proposal for Petroperu. We know that company also. And we saw -- it was a good opportunity for us after the study all the documentation. We don't know how to bid for projects in other countries. But we are available to do that in Peru because we know perfectly this country. And we have all the team available at that time to manage this project, okay? By the way of summary, the scope of the main work is as follows: Hydrogen and Nitrogen production plant, electricity generation and steam generation system for refinery process. Sulfuric acid production and storage plant, water desalination and water distribution system, sea water collection system, and refinery water discharge system, construction of different buildings and facilities for the operation of the refinery. The scope of the project consists of detailed engineering, procurement and construction in EPC of the auxiliary units and complementary works for the Talara Refinery property of Petroperu, okay? The Talara Refinery is located in the north coast of Peru, very close to Ecuador, in the city of Talara, province of Talara, approximately is 1,100 kilometers by road from the capital of Peru, Lima. The overall refinery project objectives are to have a crude oil processing or refining capacity of up to 95,000 barrels per day -- operation per day. This refinery produces a wide branch of products, okay, has a broad market environment and [indiscernible] feature of achieving compliance with the [ sulphur ] level of the gasoline in the produce according to Peruvian regulation and also with Europe 6 Well Quality Standards, okay, with low capacity of well. We made a strategy of contracting the units and construction in package, which moves a lot of risk with -- in our project with -- by creating 6 different project or 6 different package, okay, within an overall project of this magnitude, okay? This decrease also to match our risk in the execution of the project. The original contract is among -- with [indiscernible] was $957 million. We have seen 12 different amendments of the contract. With the extension of the economic contract amounts and second time to a different focus stance we have -- the most important, the COVID-19 pandemic and the Ukrainian war. At this moment is -- the total amount of the contract is around $1019 million. The gross margin currency project at the end of the project is double digit. The execution period of the project in the beginning is 32 months and has now increasing our own 1 year more for the issues that we have for Ukrainian and COVID-19. This -- this has been all from my side in Talara. Right now, I mean -- is lunch break time. Thank you so much. [Break]

Okay. We are going to begin with the second part of the meeting. We are trying to explain in some words and some slides, what is our ambition in the renewable energy market. I'm going to introduce a couple of slides. And after that, Jose Antonio Fernandez, that is the Head of Energy Renewable, here in Cobra IS, he is going to develop better all our strategy. Next slide, please. As I said to you before, we are not the rookies in this activity and this business, we began 25 years ago in Spain doing some thermosolar plants and some wind farms that the majority of them were sold or put in the market in years ago. These projects were very successful for us, including a regulation change that happened -- I don't know, but in 2007, 2008, 2010, there was some change in regulatory prices and we must detract some of the value of our assets. Even with all of these projects were very satisfied, very success. We stopped a little bit because we smell that money in this business was running out, and we have stop a little bit of our development in energy projects -- in renewal energy projects. And we do again several years ago, and now we are [indiscernible] this investment because we think that we could do very good projects for [indiscernible] and consolidate these assets in the long term. Next slide, please. And why we think all of this 5 years ago, 6 years ago, when we rebuild our capacity to develop projects. because all the inputs that we received that this is going to be a buoyant market, okay? Then you know that everyone is talking for first time in many years, we are in a market that is not depending on the demand, okay? We always -- we are -- usually, we are in markets when the power is in the demand side. And if this enough demand our business growth. But in this case, it's something that is out of the demand is -- in the hands of the government, in the societies and the big companies that have decided that they want to push the green energy and decarbonization of the economy. Then is, for the first time, we have a good share time about the market and the unique, difficult is trying to optimize when we allocate our investment. And for that, is key. Next slide, please, is key to be in a very big market because when you are in a very big market, you can select better than if you are in a very small market. Then if we, with our knowledge, we are not able to develop at least our compromise of 1.5 gigas per year with this market, is that we don't be -- we must not be here for one time, okay? Then with this huge market with this buoyant market, we could assure you -- that we can assure you that we are going to commit our -- fulfill our commitments in terms of develop. And in terms of how profitable are going to be the project that we are going to develop. And after this slide, of course, Antonio Fernandez is going to explain to you much better all of this strategy.

Jose Antonio Fernandez, Head of renewable energy of the group. I joined the group in 2007 in a different senior management positions in flow business and EPC business and really have the DNA of our group. And we are logically incorporating this DNA in all of our structure -- renewable structure, renewable platform. I will continue as Maria's presentation by giving you more details of our strategy, our structure and our portfolio of renewable projects in our group. Based on our successful background of the -- in the development of renewable projects, with the facts explained above, Cobra continues with the same strategy in our current and future projects, which I will break down in the following points. Cobra has a significant local presence in the countries in which we carry out our industrial activity. So that this presence allows us to a very close -- to be very close, sorry, to the main stakeholders generate very good relationship of great trust and credibility with local developers, and allows us to approach projects with full knowledge of the internal rules of each country. In conclusion, we are received through our local business units, and based on our decentralized structure as an important generator of [indiscernible] in each country in which we develop, serious in our actions and reliable in our results. We are very -- we have a very robust industrial engineering structure, that allows us to deeply analyze projects under development in each country, defining reliable production, and planned performance, mitigating site risks, construction risk, start-up and operation risk of our plants under our developments. For Cobra, it's a real luxury to have a very powerful structure in construction, including procurement and subcontracting specific structure that allows us to have a clear control of our production, performance, CapEx, OpEx and of all the projects that we are developing. Cobra takes advantage of the great internal experience in the structuring of project financing and financial closures, centralizing Madrid and supported logically in each target countries. As for the sale of energy from each plan under development, Cobra has the structure of our own trading company Eleia. This is our energy trading company created in Spain with a double objective. One is to adequately represent our generating plants into the public energy administration that is mandatory in Spain. And second, to ensure the best portfolio of energy sales contracts in our generating plants. Through negotiation and closure of PPAs contracts and managing the merchant market sales in each country, we are developing. Also here, apart from Eleia resources, Cobra has a decentralized energy management structure with a local support team for the direct management of each of takers in each country. Please, next slide. Cobra has a structured for the development of renewable projects with our own management of the entire value chain. To achieve this competitive advantage, Cobra has the following decentralized structure. We have an important working group in Madrid, that defines the development strategies in each country and controls and manage the risk associated with each project. And we have a local work groups in each country, good experience, and totally responsible of the business, and especially in Spain, Portugal, Brazil, Colombia, Peru, Chile, Mexico, Ecuador, South Africa, States and Australia. Fully aligned and committed to the strategies and work procedures of our renewable business units. We have a highly experienced team of close to 90 people, not counting the staff associated with our trading company Eleia and not counting our construction and operation and maintenance structure in the EPC business units. Thanks to this decentralized structure, we can develop our projects in an agile and efficient manner from origination and development with the objective to -- with the objective of -- sorry, of bringing projects to ready-to-build status in accordance with our target of 1.5 gigabits in average per year. Cobra provides a solid energy management team based on Eleia is support, that I explained, and dedicated local teams to optimize the PPA merchant ratios on each project, adjusting them to the best market situation and financing conditions in each country. So we have a solid financial structure to do this, to define the financial model and its intrinsic risks. Based on our long experience in construction complex projects, we have a senior engineering team with extensive experience in project development, production analysis, performance analysis and technical definition of the plan. Always the objective is the same, to have a good project. In Cobra, we use our internal construction structure that allows us to make advantage with our very strong negotiating position with subcontractors and suppliers, of equipment and materials. And finally, we have a planned operation structure with a good knowledge of the operation and maintenance of solar and wind technologies with a very professional and direct relation with the administration and utilities of each country. Later on, I will explain example in Del Monte Power Plant. Next slide, please. We have a pipeline of renewable projects of more than 15 gigas, supported by real projects at different stages of maturity. What does it mean real projects? Real projects imply that -- be sure that we have rejected many projects during the early stage of development, be sure. This pipeline is not including any offshore wind projects. which, as I will explain below, we developed with a different strategy, given their special characteristics with a higher risk and longer development times. This pipeline is consistent with the commitment of 1.5 gigabits per year in average of ready-to-build status projects. Taking into account that as usual in pipelines, mortality and natality along the months and years occurs. This pipeline can be broken down into 3 main blocks based on the maturity stages. There is a first package of advanced projects with ready-to-bill expected in a maximum of 18 months, reaching 30% of the total pipeline, let's say, 4.6 gigas approx. Including in this 4.6 gigas, the 1.5 gigas on ready-to-bid on December of this year. We have a second package of 20% of the total pipeline, approx 3 gigas, in intermediate stage of development with ready-to-bid expected between 18 and 30 months. And finally, a package of project in earlier stage of development with ready-to-bid expected beyond 30 months, covering 50% of the pipeline, more than 7 gigas. In summary, I repeat, we see this pipeline that is very consistent with our renewable generation target. Our pipeline is mainly solar with approx 90% of the total in solar and 10% in wind energy projects. This 10% is mainly due to the fact that actually, these -- the solar projects are less complex and less risky than the wind ones, which are highly conditioned by the actual difficult situation of wind turbine manufacturers, as you know. Our pipeline is well balanced in similar parts in Spain and Portugal, LatAm and States and Australia. By countries, our pipeline is divided into 4 main hubs with development of more than 2 gigas on each country. These hubs of these countries that are in these 4 hubs are Spain, Brazil, States and Australia, which are closely followed by a series of countries that also -- are also important in our development, such as Mexico, Colombia, Peru, South Africa, with a pipeline on each country of this of more than 500 megawatts each one. Please, next one. With regards to our offshore wind projects, as I said and Jose Maria introduced at the beginning, we have limited our development to projects with a differential advantage over others that make these attractive to any major investor in the offshore wind business. As a result of this limited development policy, we have 2 developments in U.K., 1 of 480 megabits with a fixed structure technology called Morecambe and another called White Cross, with floating technology and installed capacity of 100 megawatts. The Morecambe project is in the IDC has the advantage of being in a shallow water, 18 to 40 meters, close to the coast 30 kilometers with a seabed suitable forecast optimized [indiscernible], and we expected that this project to have FID at the end of 2025 and COD in Q1 2013. This project, Morecambe, is a real example of our restricted development strategy in these offshore wind projects. Developing good projects and taking advantage of this, I'm going to show you. This project, Morecambe project, was awarded in the same action as 2 neighboring Morecambe projects in the ADC. Both project was promoted between BP, British Petroleum, and EnBW, Niven Wattenberg. These 2 projects are 1.5 gigas capacity each, very huge projects. The auction fee for these 2 projects is -- I'm disclosing public info. The auction fee of these 2 projects is 66% higher than our project. These 2 projects are approx 60 kilometers from the coast, twice the distance of our own. More CapEx, more risk. The seabed of our neighboring project is worse than our with some areas clearly with [indiscernible], and the seabed depth is also deeper than our by about additional 50 meters. More CapEx, more risk again. And these are facts, not opinion on a PowerPoint or an Excel. White Cross, 100-megawatt floating system in the Celtic sea, the other project is a floating technology demonstration project supported by the Crown Estate, only 50 kilometers onshore from cost. Remember the information from Pedro that said 80% is the maximum in order to reduce this cost -- 80 kilometers. With the water depth of 70 to 80 meters and that technically is an optimal floating project without an auction fee and I repeat, without an auction fee. As we registered this project as a test and demo project avoiding this chart, financial chart. Another advantage is another fact. Based on these advantages, we have started a process of incorporating a partner to be concluded in the next few months. And a part of these 2 projects in U.K., Cobra is really for the forthcoming Spanish offshore win auction. Actually, we have a partnership 50-50 with CIP, the [indiscernible] product. And we are really for the forthcoming Portuguese offshore wind auction under partnership negotiation. Please, the next one. Cobra will have an installed capacity of 2 gigas, it's a commitment by the end of 2023, composed of plants in operation and under construction. The most recently commissioned project is in Brazil, the Belmonte project with roughly 600 megabits of installed capacity, actually in operation. And the 1.4 gigas of projects under construction are in Brazil and in Spain. Brazil Panorama lean project with 0.6 gigs of installed capacity are already under construction with engineering completed contracts for the main component sign and at-work start. The Spanish projects, 11 projects covering 1.8 gigas, have now the engineering completed and all main contracts for the main components already signed. Please, next one. And Belmonte project, this project is in Brazil, and has been a very successful project was commissioned in July 2023, operating with an installed capacity of 570 megawatts. This project has a good production more than 2,100 hours. Good orography that permitted a very efficient construction. The evacuation is simple with 28 kilometers distance to the substation. So it is, definitely, is a good project. It's another fact based on our structure that I explained before. This project covers 1,200 hectares in the state of Pernambuco, which is in great need of investment and employment generation. So this project in Pernambuco has been important in the social community, creating around 1,900 jobs. The fully operational plan produce around 1,200 gigawatts per hour of renewable energy each year, equivalent to the annual consumption of 400,000 households. The CapEx invested in Belmonte has been EUR 370 million financed in this first stage -- in the first stage now directly by Cobra funds. The plant currently has 54% of production under PPA contracts. The first one with public energy company totaling 16% of Belmonte P90 production with a commitment to deliver energy for 15 years. The additional PPAs signed cover 38% of Belmonte P90 production with private industrial and services companies for 10 to 15 years duration. All PPA's average prices are around from EUR 170 to EUR 210 per megawatt hours. And we have the objective of reaching 75% of production covered by PPA contracts. But now we are not currently accelerating the process of closing the -- and we are at the time of low prices due to the cyclical herein. We are not pressed on this. We are closing only the best PPAs that comply with our minimum price target. We know perfectly that it is a long-term project, 30 years -- where future upsides will occur share. The expected return of the project is in the low double digits and expected EBITDA between 70% and 75%. Please, next one. this Belmonte project has been a clear success of the decentralized structure, I have just explained for the development of renewable projects. We have obtained 28 permits and authorization thanks to the great knowledge of the administration, especially the public energy organization, NL and O&S under the Ministry of Energy, no possibility without the powerful and responsible local managers and resources. We have developed the project together with the local developer in a very coordinated and trustful partnership. We have been able to secure the main components with highly optimized costs and manage local subcontractors, reducing the construction risk. We have had Cobra's robust and reliable EPC construction structure on site, including a package made by one of the subsidiaries of Cobra Semi Brazil for the construction of 28 kilometers of transmission line and evacuation substations. And we have optimized the financial costs, initially funding the project with Cobra balance sheet with the expectation of refinancing it in the future with nonrecourse debt, when conditions become more attractive, avoiding us to bear a substantial financial cost today on the long term. Now I present you a video of our Belmonte solar plant, please. [Presentation]

Our project development in Spain, which reached a total capacity of 1.2 gigas in 21 solar plants, covering 0.8 gigas under construction and 0.4 gigas on ready-to-bill in December 2023. And with commercial operation dates, COD, 2024 and 2025. We have a closed financing for this project for EUR 700 million with a target gearing of approximately 70%. The financial closing was negotiated by our experienced financial management team in Madrid and settled in October 2023 with Santander and [indiscernible]. And this financing allows us to ensure the viability of the project initiating the construction in a solid and reliable manner. We have a commitment to enter into PPA contracts with investment-grade uptakers during the following 2 years, with an average duration of 10 years contracts to mitigate exposure to merchant prices and thereby maximize the expected return of one single digit on each project expected. Please, next one. In our renewable development activities, it is critical to incorporate solutions that optimize the production management of our plants. And we understand that at Cobra, we must hardly work to incorporate those that we consider to be the most reliable and realistic in the medium and long term. We have already done so in the recent past by being leaders in the engineering, construction and management of renewable thermosolar plants with large storage capacity, and we will do so again with the battery energy storage system BESS, which we consider strategic for Cobra in those countries where it's imperative to mitigate the risk of possible cannibalization with low prices scenarios and risk of curtailment and occasional grid congestions. We are currently in an early stage development of these BESS projects with approx 1.7 gigas of installed capacity and with an average of approx 2 hours of operation in the States, in Australia and in Spain, associating or hybridizing them with some of our own renewable development projects. This is a further demonstration of our involvement and knowledge of the entire value chain of renewable projects where there really are not many companies in the world that cover it in the same way. We understand that the development of these BESS systems is a complementary service to energy production facilities, which allows us to attend and negotiate in a more optimal way, our energy sales through PPA contracts with offtakers. And to be more efficient in our management of sales to merchant energy market. Please, next one. We are really comfortable with our current renewable structure in the geographical areas explained along this presentation. And this allows us and will allow us in the future to develop the already explained target of up to 1.5 gigas of renewable projects by 2030. This applied as to maintain and increase our development capabilities, especially in the hubs described in Spain, Brazil, states and Australia, incorporating in the next coming years, important developments in countries such as Colombia, Peru, Mexico or South Africa. By the end of this year, 2023, Cobra will have a capacity of 2 gigas of projects in operation and under construction with a clear objective of reaching 5 gigabits in 2025 with a very balanced portfolio in Brazil, Spain, states, Australia and the rest of the world. In the long term, by the end of 2030, we aim to achieve more than 12 gigas of projects in operation and under construction with a more balanced mix of technologies, solar, wind and becoming one of the main developers and managers of renewable plants worldwide, compromising an average CapEx deploy of approx EUR 1 billion per year and thus being able to take advantage of the benefits that this type of green energy development offers us. Please, the next one. As we have already explained during this presentation, our strategy always is to optimize the value creation of our projects and to this end, in Cobra, we are very rigorous in the analysis of projects during the different stages of development. We are not incentivized to increase quantity of megawatts in ready-to-build in order to sell them or doing the normal action that most developers do. But rather, we are incentivized to develop good projects to our portfolio in short, medium and long term import. In countries with mature markets such as Spain, Portugal, the States and Australia, we have targeted high single-digit project return. And in emerging market countries such as Brazil, Ecuador, Colombia, Peru and South Africa, we are looking for low double-digit project returns. In both cases, we were with a financing scenario with target projects gearing of between 50% to 70% depending on the country -- of the country. And a revenue structure based on PPA contracts with a well-performing of takers covering up to 70% is our target, our strategy of these plans, leaving the remaining 30% to other types of PPAs, contracts with small, medium-sized customers that allows us control upsides with better returns as well as very small positions in direct merchant sales. The expected EBITDA on our projects will be above 70% and in conclusion. Cobra position is a very pragmatic one that seeks to optimize the value of the project with rigorous and disciplined strategies and procedures and taking advantage of the strong financial balance sheet position of our shareholder VINCI.

I'm going to talk something about the capital allocation, okay, in renewables. You know because it's public that we want to consolidate all of these assets in our balance sheet. But at the same time, we have an agreement with ACS to give them the right to buy up to 49%, it's 49%, there is nothing at market price of these assets. We must offer them when we reach 1 giga -- in blocks of 1 giga. That's the reason because now we are not offering them Belmonte, for example, when we reach this 1 giga, we must offer them or to offer them to say that if they want to buy at market price. But at the same time, we want to have this ambition to have at least 12 gigawatts in our balance sheet in 2030. We remain pragmatic with our assets. And if we could do together our compromise to have the 12 gigawatts at the same time, we could optimize some of our capital that investing in any moment. There is nothing that we have as right in the stone. As I said, we are very pragmatic about that. But we think that in any moment, we don't know in the next years or never happen, we are open to rotate some of our capital, our equity to try to improve our profits and to try to push faster our investments in green power. But perhaps we don't disinvest the 49% with ACS, but in years, perhaps we could disinvest 49% with other investors, okay. Next slide, please. And as summarized, I want to fix some ideas. We are in this industry for 25 years. I know that I am I say this boring you, but it's nothing that -- perhaps we are not the most sexy guys doing this, but we did this in the last 25 years with success, okay. At the same time, we have the capabilities. We have the flexibility, and we have the entrepreneur spirit to do this because, as you know, the most successful guys in this industry are the guys that feel their money as own money. Some feel some because you are the owner of this money. We are not the owners of the money, okay? But we feel the money was our money. And that's to give us some flexibility that other competitors with the same balance sheet or similar balance sheet that we have don't -- haven't. Okay, then we are going to have and fulfill our commitments in terms of gigawatts this year for sure and next year. We're having a strong pipeline and we try to grow it. We will see because there are more opportunities that perhaps our commitments in terms of investment, but we are so confident that we could get a lot of good projects for us. Our ambition is very solid, and this is quite in stone. And we want to have these projects in long term and optimize them in the long term, okay? Then as I said to my team, perhaps we must begin or invest in some projects for margin 9% in IRR. If we know that in 3, 4 years, we are going to have 15% in IRR, but we must balance this with money from today. I say that at the same time, to my managers many times that I am a little bit bored about people who talk me about money from my grandsons because the -- my sons and parents was to life, good too. Now -- then we must balance the promises of future profits with real profits today. And that is in this particular item. Clap to Jose Antonio.

Okay. And I joined with the [indiscernible] with the final presentation that I'm going to say you some -- explain you some slides. And after me, is going to close by Christian Labeyrie. Next slide, please. This is the very clear slide, okay? We are the most profitable company in the industry. And these guys are the flow business, basically flow business guys. These guys are not -- have not special basically to EPC contracts. If we put them another with EPC guys, Tecni, Tecnimont, Tecnicas Reunidas, Fluor Corporation and so on, perhaps we have more advantage to the second in this margins pacification, okay? And if we see in the same picture, what -- of all of this inflow business or an EPC projects have the knowledge to do and I equate the development in renewables. No one of these are there, okay? Then as summarized I said in the first slide, this morning, we have a mix that no one has. Then we have the advantage to move our knowledge when we smell that there are more profit. Next slide, please. These are our bottom roof. We are going to do at least EUR 7.5 billion in 2025, at least. We are going to have at least 7.5% in EBIT in contracting at least. If you join this, you know that you want to do some numbers now. What I'm going to have, I think -- as you join this information with some discussion, I give you that we are doing more than 150% in conversion from net profit to cash, and we expect it much more in the next 2 years, much, much more, you can do more numbers. And perhaps some of you said that this is advancement payments. Yes, but not only advancement payments. You could try to calculate what is an advancement payment of market. What kind of projects you could think that we have advancement payment. And you can decide if it is enough if all of this cash conversion we have comes from advancement payment. Next slide, please. This is our ambition in renewable energy. We are going to commit with -- we absolutely commit with this challenge, and we are going to fulfill this commitment. And I assure you that we are going to have best class projects, as I repeat many times today. Perhaps we are not going to develop 20 gigas per year. And we are not going to be in the race that -- today, I said this, I go to my home when appears a competitor and say, we are going to do 30 gigas, I come again 1 month later and said, 40 gigas. We are not going to do that. We have the commitment to do this 1.5. And we have enough market and enough knowledge, to fulfill the commitment that we are going to have, 1.5, an idiot is able to do 1.5 with this market, an idiot. Our obligation is to do 1.5 gigas in the best class of channels. And I'm sure that we did in the last 25 years and we are going to do in the next 8 years. For sure, you must wait, I don't know, 12 months to 18 months. I know that for you, your life is today but we must look for the money from our sons, you know that our sons, [indiscernible] [ sons ]. Okay. Then next slide, please. And what was it going to be our picture? We will see. What is the unique that I can assure you is that this red color, this red bar is going to be true. I don't know if the other are going to do that bar or half. I don't know. When they will double, we are outside of the picture. If they do have, we go to have movements to the right. But what I can assure you is that we are going to have 12. And what I can assure you is that our creditability of that projects are going to be in the right of all of this because this is only megawatts, only depends of money. Megawatts on this -- you will give me EUR 3 billion for me. And you asked me 1 gigawatt, I do 1 gigawatt for you with EUR 3 billion. But this is not linked with -- then 12 gigawatts for sure, and we will see in what position we are, but we are not fighting against others. We want to assure good cash flows for our shareholders in the long, medium term. Okay. And now Christian is going to finish the presentation.

I would like to make 3 remarks about what Jose Maria just said. First one is about on money. It's also our money. It's not just the market money because we are all VINCI shareholder of the group. You know that we own more than 10% of the company. So we also are interested in making money for ourselves as well. Second remark about the margins of the competitors compared to the one of Cobra. The good news is since we acquired Cobra, 2 years ago, the margins of that synergy, has little-by-little improved in order to get closer to the one of Cobra. So if Cobra continues to improve its margin, it's a good news also for our VINCI Energies. And last but not least, cash generation, as Jose Maria told you, cash conversion was around 150% of the net profit of the year, which means around EUR 400 million per year, which has committed to finance a large part of the CapEx incurred during this period for investing in long-term projects and in particular, in renewables. So that's very good news. So now let's talk about capital allocation because I know it's a topic that you are very much interested in and you very often ask us the question about what is the policy of VINCI about cash allocation. But before talking about cash allocation, it's important to understand that we first need to keep on generating a high and recurring level of free cash flow. And that's a day-to-day relentless effort for all our business unit managers and for all our colleagues. We are -- like Jose Maria explained, cash maker, we want to generate cash flow out of all our businesses. We are all cash driven because cash is king, and because VINCI is really a cash machine, and we are perceived as a cash machine. That reminded, our cash allocation playbook is clear and constant, and we will continue to reinforce our integrated concession construction energy services business model, while accelerating our international development. International operations already represent nearly 60% of our total revenue. And as a result of that, we intend to keep on creating value for our shareholders, ourselves, and more broadly, our stakeholders, especially our employees, our business partners and the communities in which we operate. As you know, on one hand, we want to keep on broadening and reinforcing our portfolio of motorways and airports, concession assets worldwide and to extend their duration. But on the other hand, we want to keep on developing this energy business through VINCI Energy and through Cobra IS because they are both very well positioned in fast-growing markets, with an understanding visibility in the medium and long term, and they also offer interesting opportunities of acquisitions in many countries where we are established or where we intend to be established. Xavier Huillard, our CEO, very often emphasizes the fact that energy services are even better than concessions because they generate recurring revenues and cash flows in growing markets, but they also have no end contractually speaking. So energy outlook is bright today more than ever. Indeed, as we have seen today, global growth will be greener and greener. The agility of the country will be more and more correlated with its capacity to produce, to transport and to distribute electricity and green electricity. Capitalizing on Cobra IS track record and expertise to develop greenfield renewable energy assets, we will progressively build a significant portfolio, as Jose Maria explained, of such long-term cycle assets by investing around EUR 1 billion as an average per year. So in total, around EUR 7 billion to EUR 8 billion by 2030. So this is consistent with our goal to broaden our portfolio of long-term assets to extend its average maturity and to create value. Obviously, as we always did, we will progress at our own pace. We are pragmatical people. Setting up realistic objectives without chasing volume of activity at any cost but giving priority to the return on investment. To wrap up, the successful integration of Cobra IS further accelerated our strategy and makes VINCI a winner of the energy and digital transition megatrends. So the key takeaway of the day are, one, we are now the biggest and truly worldwide reference player in energy services and EPC projects, able to accompany our clients almost everywhere in Europe in North America, Latin America and the other continents, Africa and Australia. Second, our offerings stepped up with Cobra IS and knowledge expertise in delivering turnkey EPC projects in the energy sector. Third, we benefit from Cobra IS expertise in developing renewable energy concessions or long-term contracts from its deeply locally-rooted development teams to become a significant player in this sector with the portfolio of assets, mainly solar, which should reach at least 12 gigawatts by 2030. VINCI financial strengths, obviously, will be a further advantage in accelerating the new unit growth as a long-term operator of value creative assets. And finally, this is one-of-a-kind alliance between best-in-class Spanish and French engineers recognized for their on-time and on-budget project management and this unlocks potential to address global challenges and contributes to the environmental transition. So maybe to finish with this presentation and before going into the Q&A session, a few words, a few comments about the valuation of Cobra because of -- some of you, I know, still consider the value of Cobra should be very close to the one of the price we paid to assess 2 years ago. So EUR 4.2 billion. I think with the figures that Jose Maria presented, you should revise, I think, your valuation, considering EUR 7.5 billion revenue by 2025, at least and 7.5% EBIT margin at least if you apply a multiple of, I don't know, the competitors are between 10 and 12, something like that, it should bring you to a significant higher value to this company compared to the price we paid 2 years ago, not taking into account the prospects, very interesting prospect in the renewable concession that we intend for the portfolio, we tend to build, we have a 3.6 giga already on hand by the end of 2024. So I hope we [indiscernible] you that we made a fantastic acquisition 2 years ago acquiring Cobra. Thank you for your attention. And now we are ready to try to answer your questions.

Elodie Rall from JPMorgan. Thank you very much for this very, very interesting presentation. I have a few questions. Maybe I'll start with the first one, which is for everyone. Since the acquisition of Cobra IS, I was wondering if you could share what VINCI Energies has learned from Cobra IS and vice versa, because Christian, you said it yourself, there is growth in Cobra IS, there is growth in margin, and it translates as well in VINCI Energies. So if you could also give us some color on the VINCI Energies side but on both VINCI Energies and Cobra, first question.

Maybe at least [indiscernible] answer also. Okay. To be very clear, there is no intention to merge Cobra and VINCI Energies. We have to be very clear. The culture of the 2 companies are very different. The expertise are sometimes similar, sometimes very different. So it would be a value destruction to try to go into this direction. So maybe the best answer I can make is the one I already made, is to create a limitation within the group. To be even better, more excellence on both sides. I don't know if Christophe wants to add something.

What I could add is that when we did the deal and we did the full review and also for competition questions that are obvious were to look what that was on overlap between VINCI Energies and Cobra. And the overlap region, if you want, is no more than 3%, 4% of the value of Cobra, you should try to look to countries or regions where they are both present, that are not necessary in the same core for Cobra and so on. So and we have another test, which is, as you -- I think it's probably explain that at a certain level the products come to the headquarters, so you can see if there is a project with this standard by both of them. And the limit is EUR 80 million. So it makes the product really I think this has happened in 2 years once. We have a procedure of Chinese word, very straight concern to be in line with competition law. It happened once or twice in 2 years. So it means the overlap is not so important. Second, as Christian said, I think we -- I tried to explain a little bit about the cultural fit between VINCI and Cobra and why we thought it was making sense. But as we tried to merge VINCI Energies and Cobra, which just lead to kind of disaster. For instance, VINCI synergy, I think honestly is much more stronger in IT, high-level expertise, but Cobra is much more expert in major EPC projects. I mean if you try to merge at the end, you will have nothing. So that's what we see.

My second question is on margins. First of all, if you could give us a bit of color between the differences between the flow and the EPC margins. We -- I mean, are we right to assume flow is more in line with VINCI Energies and EPC is much higher. We've seen some examples already from Dragados Offshore at double-digit. And my second question on that would also be a follow-up on the guidance on margin. I mean, you're basically guiding to stay fairly flat. I mean I know it's above 7.5%. But given the pipeline, the growth just from that Dragados Offshore being multiplied by 5x already by next year and into double digits. How can you say flat? That would be my second question.

Okay. Well, first of all, it's true that the flow business is more consistently and perhaps we ask less money to beat, okay, that we ask to EPC contracts because the spirit is that they are more risky. But at the same time, always happen something around EPC projects that accelerate the margins. Then it's true that with the backlog we have and with the level of risk we have in EPC now. Our actual backlog could be some difference between the margins in EPC that we did in the past. Then if we are going to increase our margins, and I hope it happen. It's true that probably appears from the side of EPCs. But in terms of our last 20 years' performance, there are not so much difference between perhaps some years is better if you see some of this -- that is because of this lower risk, but with the healthy backlog we have in new business now is probably that this things that detract some part of the margins of EPCs will do -- will not appear and we have -- we could have increases of margins in EPC projects -- [indiscernible]. And the second one?

It was the indeed, if we could have a split between flow and EPC margins and...

No, no, this is the reason why I say due about the difference between both. And what you say that you are going to be flat in the future, with 7.5%, at least I think we are not going to be flat, but we say that we are going to be flat. I think it's my -- they pay me to increase the margins. And with this particular moment that we have in our industry, we don't -- we were flat and we are going to be disappointed, okay? But this is what is our compromise, at least 7.5%, significant least -- at least 7.5%, at least.

That's fair. I'll just have one last. Is there any bottlenecks in your growth ambition? I mean, presumably, it's a people's business. Are you worried that you won't find the labor, the workers, the skills that you need to grow given the pipeline?

No. No, for this pipeline. We are absolutely confident that we could face this pipeline 100% in quality, in schedules and costs. But it's true that there are bottleneck if we want to grow much more than we are growing because first one, we don't want to do this first one. In flow business to growth or do growth inorganically buying companies as VINCI Energies do, that is not our scope or it's very difficult to increase our growth, okay, more than long-term GDP of the countries. In flow business, we [ offer ] EPC, we can grow more because we have many people asking our services, projects every day as we never saw in the past. But it's true that there are complex projects, even with this more lower risk contracts we have, it's true that they are a little bit more risky because the size, because the amount, because the complex of the project. And we don't want to face these projects with people from LinkedIn. This is not a joke. We could being awarded with much more content in EPC and try to look for people in the LinkedIn. But we are not going to do our EPC with this guy that didn't demonstrate us that they can earn money to the contract because I said in the launch, the unique skills you must preserve in your company, is the skills to earn money and to earn money in contracts. I don't want any guy with combined cycles of experience, that is what we could see in the LinkedIn. I want the guy that each work or project he did he won money. And this can be disclosure for third parties. You need to create your teams in your at home and because you can see all the performance of this guy or this team. And this is impossible to do outside your company, then that's the reason because we have a little bit limit if we want to be the leaders in profit, the leadership margin our growth in EPC. That is the part that we could grow more today. But we stop a little bit our ambition in this -- in the last 6 months, and we are we try to select better the future because we must allocate our human resources in the adequate business project to maximize the return of these human resources that we have.

Over here. Yes. Luis Prieto from Kepler. Thanks for devoting your precious time with us today. I had 3 questions, if I may. The first one is you've been pretty clear about the 12 gig of capacity outlook. But the problem, and you also referred to it that ACS has a dilutive role and can reduce that exposure. Is there any way you could boost your pipeline outside of the sort of the ACS pipeline, would you leverage VINCI Energies to an extent? Or would it always be done through Cobra IS? That would be my first question.

Done, the development or the construction?

The renewable -- holding the asset. The development and also holding the asset. Because my fear is that if ACS theoretically went for 50% or 49% of everything, you're suddenly left with half of your exposure. That would be -- I would think that would be undesirable from VINCI's perspective.

Yes. Yes, it could be. It could be, as I said, I said to you that we are pragmatic about that. Could be that with more resources, we could, with more resources because we just invest part of them, we could improve more our development to try to achieve 51% of 20 gigas instead of 100% of 12 gigas, could be. We will see depending of the price market that we could get, and it depends on many things, but could be.

Okay. Okay. And related to that, in the current environment of the post-Orsted environment for valuations of renewables in the world, even beyond offshore, I would say investors are reluctant to recognize the value of pipelines. I just wanted to take your commentary, do you get obsessed with that? Or it's just a long-term view that you take and you don't care what the market thinks today?

No, no, no. We -- I see that so respect with the money from my fathers, I'm not only looking forward. Now yes, it's true that the evaluations -- I think that you know that market in each business we are in the last 20 years, it's true that all of them are moved in ways, okay? And every -- in every market appears moment that the wait is too high and became stress [indiscernible]. And -- but there are other moments that they became crazy to show too much respect with the market. And we are now -- I think that just passing the moment of any one, everyone is saying that they have too much risk because prices, because you can see in the panels costs that goes 70% down in 6 months, I think, 6 months and 8 months. And this is because the market is reacting exaggerate, in my opinion. But yes, those were prices or valuations of battle. And now we have -- in my opinion, more on our valuation, and we are comfortable with this evaluation we have, and we think we can improve a lot. But it's true that all of this rubbish market in development is slowly but clearly...

Just as an additional word because as following up all acquisition for VINCI, I see a lot of pipelines. I can tell you, then you have to believe me, but I can tell you that the way this pipeline is built is much more serious than 80% of what I think. I mean there is nothing there where if you are asking us, we will not reveal it because it's not the game, but we have a database that is totally corresponding to what we have shown many developers, in what they call early stage to just take a map and say, we could put 100 mega there. This is not the problem there. So perhaps you can find it conservative, but I mean I think you will not change our DNA, but basically, there is a full database with all the projects, all the locations, the powers, where you think the reconnection makes sense, how you could acquire the land and so on. And if it's not that, it's not in the pipeline in this presentation.

Understood. And I have a final question, if I may, for [indiscernible]. I just wanted to understand a bit better the -- what you talked about cash conversion. How does the working capital work at Cobra IS?

Working capital in the whole size or the variation that we had in the last 2 years?

How it feeds to your cash flow generation at the moment?

Yes. We create at least this year, we are creating at least EUR 200 million in cash from the working capital, and we expect it much more in this year. These are the cash that we are going to generate only because of the improvement of the working capital.

And that's sustainable for [indiscernible]?

No. Now when we grow, there are some -- you know that historical item, you are familized with our accounts that were publicized in ACS, the whole in the last 20 years. But you can see in this report that we have historical negative working capital. Then in days, imagine 60 days of our revenue in negative working capital. If you increase your revenue, increase your negative working capital in absolute amount with the same days, okay? And as I think that we have a conservative accounting, we are creating a little bit more working capital that -- only with the effect of the growing, and we will see with this level, we don't grow, it's probably that we stabilize in very high, negative working capital, but it's not and grow if we don't grow because we can grow, we are much, much more money than we declare this closure. I don't know if it's clear.

Paul Chabran from [indiscernible]. A couple of questions, still on renewables. First in Brazil. I think you briefly mentioned price pressures at the moment coming from high hydro reserves. It seems to me that the situation is quite worse than that. I mean, the price in the spot and futures market is essentially 1/3 of the recoil PPA prices. We have a [ 2/3 ] of the supply. I think the government is putting on action 8 gigawatts of thermal power. So these environments, some players actually had to leave the country. I'm thinking of [ Actionaria ], I'm picking up small bit of Peru, are real struggling. So what are you doing better than others to develop projects there?

Okay. This is the best. The second question I have in [ other ]. We did an Investor Day in ACS 5 years ago, sorry? Yes. No. Same question is because we are not a sexy, then there are sexy guys that create the trend, then as the sexy guys goes out or say that they have problems to develop this 0.5 gigas that we won in the action in Spain. When Iberdrola guys and [ Actionara Energy ] guys and [indiscernible] guys said that [indiscernible] in Cobra because they know anything about this. And a PSA in the paper, I imagine by them. And the news say that Cobra is going to fail, Cobra is going to fail, they're going to be 3 giga, they are not going to be complete gigas. [Foreign Language]. Why? I don't know what is at. I am not going to blame fine. But what are we going to do better? I don't know. But what I am doing, I can explain to you, is to try to develop from the scratch because we have 30 years of footprint in Brazil that [indiscernible] hasn't okay? It's more actively, but hasn't. We know we are in the lunch we are -- we know we are the connection points, because we are the biggest and more important, for example, operation and maintenance transmission line company for third parties, not for our asset because we sold them. And we know their stations. We know the connection we know the regulator. We know the owners of the land. We know the business in Brazil. I don't know why they left Brazil. But I am so comfortable with our projects. And I think that we have a very long term projects. And we think that it's going to be successful VINCI these projects.

Maybe let me turn the question around, are you comfortable finding client purchase electricity at 170 to 200 when the same client can purchase electricity at 70, 80 on the [ purchase ] market? I think is a price question.

First ask them. Second because this -- what they say as because I ask the same to my guys, I as you can understand, when we are signing contracts at 200, I say, we, why this stupid guys buying the energy at 200 when they want it because perhaps next year, they [indiscernible] I don't know what is the running now. The [indiscernible] disappears and it begins the dry season in Brazil. And in Brazil, in other countries, people move in -- in packs and it's dry 3 months without a rain and the big industry begins to threaten and move the legs and they go to -- they are trying to fix the risk. That's the reason that they give us. There are companies, serious companies. They are not idiots. What they are doing, this is the reason. We are not comfortable with this level of prices. Even with the PPAs we are saying, we want to do something more.

And maybe just a second question on Spain, I mean, situation looks pretty bright right now, but I think there's somewhere between 50 and 100 gigawatts of capacity in the permitting queue. So eventually, this project will come on the market will start waiting on the returns. So how do you see the long-term outlook in the country that still comfortable that you can achieve bigger targeted returns in an environment where you have to compete with dozens or hundreds of others developer?

First, we have 1.2, okay, 1.2 that we have the other permits. I know that a long queue of people trying to waiting from their permits. We have a portfolio for 2024 [indiscernible] to achieve rate to bill, but it's not included in 1.2 or more projects we have. But that project that must be linked with public actions, you know that now this January is going to -- next January is going to find -- to end the period when you can be the owner or you have the rights in the connection point here in Spain. This is going to disappear. All the connection points available are going to be managed directly by the government by [indiscernible] Electrical. And then a part of these projects that we will see what is going to happen. I think that they are going to deliver a lot. But it's true that there are many -- I'm going to [indiscernible] about the products in Spain. There are 3 parts of products in Spain. One is this battle of guys developing rubbish and putting some absurd guarantees on the operator to block some capacity in substation. This is a part of them. At this part with or without permit is not going to go ahead for sure, because that absolutely rubbish in terms of return, in terms of CapEx, in terms of everything. Second is the guys that have -- serious guys with money that bought companies, their companies, platforms and portfolios at any price. For example, you know them -- at $300,000 per megawatt in development. And these are famous guys. There are some that became rich and these are big utilities in Spain and very big and reputed firms that have invested at this level of prices. And they have, imagine that they are going to get the permits, probably, and they have the money, but they have 2 [ observes ]. The resell that we haven't and bubble research of guys to resell the projects. I don't know who is going to pay what they paid or be into construction. But if you begin the construction at this price of development that our price of development is 0. 0, because we don't pay anyone for a project in Spain, 0. We compete with EUR 0 in development, the [indiscernible], it is the name, fixed, 0 we compete with people that has paid EUR 300,000 per megawatt. Then these guys would resell or could begin the construction, I'll show to their investors that the IRR is, I don't know what they are going to show, because we show almost 10% with 0 indirects. I don't know, but they are going to show this 1 number in very [indiscernible] in the presentation saying and assuming [ 60 ] of megawatts, I want to do the same, okay? And the third part is, guys, as we or other big players that have the contracts that the developments at good price and they got going to construct. Then these are big amounts of gigawatts, real gigawatts could be a third part. What are you going to be in the future? I don't know. But they are not going to be at this level or the level that now we are so comfortable with the market that we have. Now [indiscernible] this kind of the life, sorry.

Sven Edelfelt from ODDO BHF. Two questions for me. Thank you for this presentation. The first question would be maybe for Christian. Christian, you help us valuing Cobra IS., thank you. Can you help us valuing the renewable portfolio? If I am not mistaken, the last transaction was Galp buying 0 E for 2.9 gigawatt. It was EUR 2.2 billion. So can we use this as a metric to value your 5 gigawatt project? And maybe the valuation is, I don't know, maybe EUR 3 billion to EUR 3.5 billion. That's the first question. And the second one would be for Jose Maria. What is your incentive for developing the renewable portfolio? Is it on IRR? Is it on transaction value? Is it on cash flow?

Yes. I mean Christian delegated me to answer you for this value of portfolio. The value of portfolio, in my opinion is we're not able to do it for you. It's your job, not ours. We try to give you as many elements as we can. But as you saw in Belmonte, we give you the workload factor, which is not nothing. It's the number of hours at which given power is producing equivalent in the year. I mean Belmonte 570 megawatts multiplied by the load factor. You have the number of megawatt hour or gigawatt hours produced by the plant. So we give you this part of the equation. The other part of the equation is the cost -- the price of the energy, the price you sell the energy. And I think there are decent forecast on that, but nobody is able to tell you what price energy will be in such countries in 10 years. I mean this is something you really have to make sure on your own valuation. I mean, since I am in this world of energy, I spent part of my life in other, let's say, business worlds. Experts are experts. When they started to tell me take 35, that's a very solid price. In the following year, it was 200, 300, 500. Some people say 60, 70, whatever you -- but I mean, it's something where I don't think there is any total and transparent truth. It's a transaction value. I think that is a little bit old terms. But Jose Maria told you that in transactions were up to EUR 300,000 per mega, so EUR 300 million per giga, okay? You can make models showing that if you want, not difficult.

And you're asking about my incentives or the Cobra incentives?

Management team incentives and your incentives as well.

My own money. Okay. I don't know if I can disclose this information. What I can disclose is how we manage the company. We have an incentive linkage with -- in terms of renewals, you're talking about renewables. An incentive that is linked with the amount and with the IRR, it's not the same. If the IRR is very low, we are not going to liquidate any incentive for the megawatts because, as I said before, an idiot could at any price and at any IRR could develop. We're talking about the rest of the business. Majority of us, all of us in Cobra IS including me, of our variable remuneration linked 100% with the EBIT of the company, 100%, 100%. What I could assure you is that no one in this company that earns money for the company, are uncomfortable in the company. That's one of our secrets. It's true. It's one of our secrets. But bad guys know that people that don't earn enough money prefer to be in other companies, because they have a better remuneration for wake-up. Here, people that are -- have good performance, have enough remuneration, and there are not other companies, and I know many companies that could compete with our incentives that are linked with the performance of each business, nothing linked with the cloud, sorry, with each business unit.

Hello. I don't want to add something about your remuneration. I just want to add something about the question regarding the value of the portfolio. I think you can value a portfolio on the one hand, the addition of all the projects and the value of the platform. The value of the project is different from one project to the other, depending on the country, depending on the cost of financing in the country, depending on the capacity to leverage the project to determine the amount of equity, which is led to the portion of PPA. If you have a PPA, you can secure long-term financing. So there are many parameters, which might vary from one project to the other. So once you know all that, you can value project by project. What is important to understand is the model of Cobra consistently being involved at the very beginning of the development stage so that you can expect to create value when it's time to eventually sell all or part of the project to [indiscernible] to somebody else. And then the value of the platform is different. It's the capacity to generate new projects. So this being said, it doesn't give you a figure, just to give you some idea of how we proceed.

[indiscernible] from Stifel. I've got 2 questions, if I may. The first one is on your historical pipeline over the last 20 years. I was wondering what your success rate has been in terms of development of projects? You were talking about 25 years of history. So if you could elaborate on that, please?

I am 52, 25 years, I don't know where I was, But in the very beginning with the projects in Spain, Imagine 70%, 80% of success with the projects we have now imagine that for us, more than half is almost 90%, the rest for 2025 and beyond -- 2026 and beyond, probably imagine 60%, 50%. But at the same time, we have 2 years, 3 years to rebound some of projects to make [indiscernible] other projects, okay? Then -- if we were -- we must say, what is our maximum capacity with this pipeline to do, I think that we could do more than 1.5, but we prefer only to talk about what we are for sure that we are going to do.

Okay. And my second question is on the flow business. I think you mentioned about a 40% exposure of revenues to maintenance. I was wondering if you could give us the proportion of repeat business for the flow business? The proportion of repeat business, so renewed clients.

How many times we have in the -- how many percent of our revenue are in backlog or?

No from a year to another, how many clients do you -- what's the proportion of the revenue that you keep with the same kinds?

Yes, 80% sorry, I have a very poor English and my ears are old. Yes, I think that in maintenance, 70%, 80%, probably 70%, 80% of [ EBIT ]. We have much more backlog that we recognize in terms of maintenance. But our criteria is not to put more than 12 months in long-term contracts.

We have the same accounting procedure [indiscernible] in quarter just 1 year of maintenance at the beginning of the year [indiscernible].

Yes. Sathish from Citi Group. I got a few questions here. So first on the contract mix. So obviously, you've given a good split around the public contract versus the private and also by the sector. Any color on open book versus the closed book contracts? And how does it actually split between the EPC and the flow business? Where do you see more open book contracts exposure is basically any cost-plus pass-through element there?

Okay. I'm going to answer. So much so clear as I can, okay? Usually, flow business is lump sum. Usually, flow business is lump sum, okay? We have some equations to evaluate [indiscernible] some costs, but these contracts as they are a very short-term contracts, very close to the client contracts. This usually are lump sum, turnkey contracts. In EPC projects, in the last 20 years, majority of them were turnkey, not only in our portfolio, in the world. Included U.S. that could be the country with open book. I am talking about industry, okay? Now I'm talking about construction. But as you know, this all big wave that has passed over many companies in contracting the clients don't find enough contractors, and they are changing, okay? Then in EPC projects than when a turnkey or lump sum will be more risky. We have now in our backlog, because we have mixed contracts. When we have contracts when a part of [indiscernible] part of cost plus a part of linked with inflation of the labor as example. Altogether, perhaps we have of this EUR 10 billion in backlog to a EUR 0.5 billion in pure lump sum. The rest are linked with someone that avoid the risk. That this in the world that we like 3 years ago was a dream were in the dream now because this lack of contractors.

That's quite helpful. In terms of the second question, you mentioned about 150% net profit to cash conversion. Obviously, you did say that it's not sustainable. Where do you see that normalize through the cycle? And when do you expect that to be back to the normalized levels? What is the normalization level?

I think that's going to be normalized in 3 years. I think that in the next 3 years, we are going to have more than 100% in cash conversion I think. Normalize is 100%, because I am talking about contracting. In contracting, if you don't collect at least 100%, someone is not going well, in contracting [indiscernible] you must pay the rents.

It's [indiscernible] from Marshall Wace. I just wanted to follow up, I think, on a previous question, which was, I think, unsatisfactory answer, which is around renewable development. When you're developing a solar plant, you're putting capital in the ground for 25, maybe 30 years, right? And your output is relatively well forecasted, but your price is not. But you can derisk that signing a PPA, but it's typically for somewhere between 7 to 15 years. So [ the reason ] merchant exposure in the period beyond that. And on top of that, you're actually saying yourself, you're keeping 30% merchant exposure. So in other words, the assumptions with regards to the merchant power price of absolute crucial importance. because the spread over WACC is only about 200 to 300 basis points. Now at the same time, we're looking at, for instance, the Iberian situation where we're already seeing capture prices for solar assets dripping below base log prices, right, because there's too much solar being built in Spain at the moment. So when it's a sunny day in August, power prices just go down. And we're not capturing that power price that we think we can see in Bloomberg. So I'd like to understand for you what kind of assumptions have you made that make you comfortable with the merchant power price, not just today, it isn't actually within the years in the future? Because it feels to me that, that is a different risk that you're taking on than say traffic risk with the toll growth. And it's one that I find far difficult to underwrite as an investor.

Okay. Now here we are with a good question. When you are an energy producer, you have energy price risk. When you are in a motor way concessionary with traffic risk, you are a traffic risk investor. When you are a producer of oil, you have risk of oil. The last 5 years, 10 years in this industry, someone has -- many people have tried to create a bond when there is not a bond. Someone -- these infrastructure funds, some of analysts banks, not talking about the analysts of equity, people that evaluated they're going to give us money or not. And these people try to became in a risk of energy, because they produce it. You can't mitigate the risk, but you can avoid the risk. We are not going to try to get a 10% in euros in Spain bond after the years, that's impossible, that's impossible. It's a dream that's impossible. And for sure, no, this is possible. A bond for 10 years here, Spain is at 5% not 10% and we're not going to be for sure at 10% [indiscernible] during the next 30 years, you can mitigate that we are going to do. And what we're doing is trying to mitigate with PPAs, with a storage that we are fighting for them, and we are developing some projects or we can hedge for -- in a synthetic market 2, 3 years of our energy. But just -- but we are confident that we are going to achieve what are our assumptions that assumptions until 15 years later, the [indiscernible] assumption is these people throw in a car. But there is no any other option. They are not guys, they are not [indiscernible] in the magic word that I assure you, you can't. The big utilities that have big internal PPAs can't. Can't, because if the market got price go down, I'm not going to buy the energy at the merchant price in 5 years as I am buying to the big utility today. Then it's true that the market has deteriorated because these dreams of bonds at 10% in 10 -- 30 years time had disappeared. But it was a lie. It was something exceptional that they could mix or fix that. But we have 0 cost in the mix development against the 300 the competitors are -- competitors that haven't data, many competitors. And we have the knowledge to try to improve our storage and our relation to try to mitigate the risk. Perhaps we have more than this 10% that we expected. But perhaps we have less, our grandsons will see.

Gregor Kuglitsch from UBS. Can I go back to the sort of capacity and growth potential, I think over lunch we're kind of saying, there the danger of chasing too much growth? There's a bit of capacity questions in the particularly the Dragados Offshore. So give us an idea of what sort of the max pace you could be running at in terms of growth? What's realistic and sustainable for a business like yours?

I think that we can improve more or will have more potential in growing in the energy projects, but not in Dragados Offshore platforms, because if we could sell more projects, but because we are selling is not so far today -- to today. Perhaps we could grow a little bit more, but not in terms of revenue per year, in terms of backlog in our business, we must write the platform and the awarded in 2040 to delivery in 2040, we are going to increase the backlog, but it is not going to increase the revenue. I think that the revenue in Dragados Offshore, I don't know. We can ask Pedro as we are in the limit above 1.2, 1.3, 1.4, we must think and other things. In perhaps in energy, in traditional energy when the energy for third parties, we could increase our backlog. And I think that we could increase our backlog, but not multiply by 3 every year, but in transmission lines and for sure in flow business. And the flow business is probably, I said, GDP, but it's growing more than GDP in this year, I mean, I think in the next 2 or 3 years. Then we have capacity to increase our revenue above this EUR 7.5 billion. But to be honest with you, we prefer not to be so ambitious in that, trying to give you a good news today to have a problem in 5 years, but we have capacity to grow above the EUR 7.5 billion for sure, because we are idiot that part of the EUR 7.5 billion [indiscernible] poor inflection, poor margins. And in terms of cables, in terms of kilometers and [indiscernible] of meters of welding, in terms of things to do, we are not in our peak.

Okay. And then maybe a second question. And then maybe it's a part question to you and part question to the VINCI team that due diligence at the time. I guess the question to the VINCI guys is what surprised you in the end compared to the time when you bought it? I guess there was a lot of upside as you suggested, but kind of the big surprises perhaps both positive and negative. And then perhaps for you, Jose Maria, what's kind of changed as a different shareholder. How is the -- anything really changed for your day-to-day other than being here with us today, of course?

It's a little bit easy to answer to this question because when you do a due deal, at least when I do due deal, I'm more on the defensive side looking, okay, I want to make sure to be sure not to make mistake somewhere. But surprised, to be honest, the Dragados Offshore development has been a surprise to me. I knew you were in this oil and gas business that it was the end of the story. And I knew a new story was coming. You had out of this 14 giga, you quoted you had already 2 giga in hand at that time. I would not have better 14 giga in hands that -- I mean, less than 2 years after. So this has been honestly a surprise. I was betting development, but not at this level. So thank you very much. And yes, if you ask me the important -- the most important surprises for this one, by the way, the EUR 1 billion revenue is an average '24-'29. It's not next year. Okay. And don't know.

[indiscernible]

For us -- what is changed for us?

[indiscernible] obviously [indiscernible].

For us, I said in public many times. For us as an industrial company in this business has been -- this is not to give good words to my owners, but it's the best buyer that we could dream about, because it's biggest industrial services company in Europe, in the world apart from China. It's a very clear long-term company that support us to invest in long-term, too, and to have the -- to choose the right moment to do things without any pressure. much more than normal pressure. And I say to some of you, you know that we must send our accounts each month to our headquarters. And it's 3 months, there is a little bit more. I don't receive any call in my life in the last 2 years. And with the other owners, I had some calls saying that could you help us in $100,000? No, the employees ask the 10% of the company. And they are worried about what is going to be in the next years with the company and this is a very important difference, because the spirit to give to the shareholders as much as we can is in Cobra, yes. We don't need to remind us that we must create value and send money to our shareholders. But this can that we have because our shareholder could get the best moment to do that to try -- to allow us to do things is very useful for us.

This is Victor from Societe Generale. I have 2 questions. The first one, if you can update us with Polo Carmópolis deal and if that Polo Carmópolis is included in your guidance for 2025? This is the first question. The second question is that Jose if you across within your different divisions in the next 4, 5 years, if you can identify why type of subsidiary you think according to your, for example, leadership position, market growth dynamics, you think that is the one that is more promising within Europe?

Okay. First, with the promise subsidiary. And after that, with the Carmópolis project. And that is the white elephant in the room. Okay. About promise. But I don't see promise subsidiary. What I see is that the part of [indiscernible] Offshore the networks, the distribution and the transmission activity is going to be our next [indiscernible] - for sure, you have any doubt about it. It's going to be the best and more profitable next, I don't know what to be now the -- next market, okay? And second one about Carmópolis. Carmópolis is something that I'm going to try to explain a little bit what is Carmópolis? Carmópolis was awarded before the acquisition of Cobra by VINCI, before. And I am not asked to VINCI if they want the target or not, because it was illegal because they were not the owners. Was awarded before, this is very important to understand what is Polo Carmópolis, before. And after the signing and the first disburse [indiscernible] all the money was a process of closing. And we paid the first disbursement, 25% of the project before Cobra was in VINCI, okay? That's very important. And then we begin the process to close the transaction and we could do twice. One is close the transaction. And second one is give to Petrobras, EUR 275 million as a gift and lose the project. That's twice. I think that second is offshore, okay? Yes. Then we begin a process to close and to give the contract, because we were not operating the contract in 2022, maybe 1 day, okay? Because we were closing the project was on Petrobras hands. And they managed and operated the project, because we were closing to have permit. We needed some permits, have a low ones of the regulator, et cetera. In the [indiscernible] 2022, okay, for some failures in environmental and in the process of investment by Petrobras because it was their project, they [indiscernible] that is a regulator close their field. And I don't know if you are familiar with what is a field of oil. But if you stop production goes to 0, 3, 4 months, and when you open the banks, this is not water, okay? That's not, again, the production and you need a ramp. The field is head, okay? Then they do something when doing math, investments and some reports and so on. And 3 months later, we closed definitely at the end of last year. And we were the owners, was on December of last year, not before. But we were not operating when [indiscernible] the field. This is very important to understand. This moment, they give us a 4,000 barrels per day project. That's what they say, they give us. We expected in our first moment when we paid our first time 25%, we expected that we are going to receive a 7,000 barrels per day product, okay? Then In this year that we have 1 year in delay, because we expected to begin in 2022, and we began in 2023, we must recover the production that we think that were in our field from the beginning, from the scratch. And we met -- we face 2 problems. One is the lack of resources to drill, okay? And the second one is the lack of resources to do workovers that are rebuilds of the wells, okay? Then we are 1 year of delay due to the closing of the operation 1 year later and another 6 months of delay in our plants, okay? Then what we have now is with much more limited CapEx, because we haven't the drill equipment. Now we are receiving the drill equipment. We have at this December 10,000 barrels per day project. But you must understand that we expected to have done for this year -- at the end of this year, 288 wells, and we only have 3 due to this. But we are going to drill these holes, these wells in the next year. Then we have a delay of 1 year. But the project is doing well. It's more -- a little bit more quality due to the finance costs. That is true that with this level of cost of finance, the EBIT is what we expected, but the profit is below what we expected, okay, but below much -- is lower. But it's true that at the same time, we are not creating today the barrels that we think that we are going to create there. That's -- this is kind of Polo Carmópolis. And we are very satisfied with this project. This project was before the acquisition of VINCI, because I read something that executive. VINCI announced [indiscernible]. VINCI has these 2 options. One is write-off EUR 300 million or go ahead, try to improve the project and have a strategic review when we could do. That is at least 1 year after we close. Because before that, we can't do anything by the contract. We can't do. We can open a process to consolidate 50% imagine. Before the -- before 1 year after closing the contract. Then next year, in January we are allowed to begin a process to this consolidate and -- but now we are focused on trying to improve the field as we expected that it's going to be and then try to optimize our consolidation that is going almost sure to be.

[indiscernible] included that project?

No. In the backlog, we have 3 months of amount, 3 months or more, 5, 6 months, I don't know. But it's nothing relevant, because this is something that will change the whole account of Cobra. Because if we -- next year, we are consolidating that, it's going to be something that could disturb, no.

I would like to add a few comments. First, what Jose Maria didn't say that Cobra has a very strong and long-standing expertise in providing oil and gas services in order to stimulate the production of oil, but we are not, Cobra is not an oil producer by definition. But in this particular case, the Carmópolis contract was a way to increase the activity in this specific scope of expertise of Cobra. Second, the acquisition of this contract was entirely financed out of an offtaker so it did put pressure on our finance, because the offtaker finance it 100% of the deal. First, due to the delay with the closing that Jose Maria explained, we still have put this project under review, and we intend to sell it finally, but it will take more time, because to optimize the return, we have to reach the level of production, which is optimum, which is not done yet. But we are confident that we should reach it in the coming months or years. So we don't want to put excessive pressure, because we don't want to make a bad deal, but we even think we can make a good deal. It's just a matter of patience, time to improve the production.

[indiscernible].

Something more regarding Carmópolis?

Jose Maria, its Jose Arroyas from Santander. Just a question also on your -- on the former shareholders of Cobra IS based on the current projections for the renewable development pipeline. And does cover expect to have to pay the maximum amount of earn-outs of EUR 600 million or a lower amount?

One of my old boss says, we have EUR 40 million per gigawatt, you know that. EUR 40 million per gigawatt, There are only 1 earn-out now because people became crazy with earn-out, with the SPV with the joint venture, there are only 1 earn-out now that is EUR 40 million per gigawatt, okay? With our projections in 2030, and this is 8.5 years, this is term. Then with our projections, we are sharing with this red bar that we see before EUR 480 million we can give more than what we develop. If we do more could be more, if we do less, could be less. But in our forecast, we are projecting, that it's not my -- I'm not talking about ICS, but maximum into ideas we're seeing this EUR 480 million.

No more questions. So if there's no more question, we thank you for attending this meeting, and hope to see you next time in another Capital Market Day, and I don't hesitate to ask if you have further precision to obtain from us. Thank you very much.