Bouygues

Hello everyone, thank you for following us on this webcast. Thank you for your attention for this presentation of our results that I will comment with Pascal Granger. And then at the end of this presentation, with all the bosses and members of the General Direction Committee, we will answer your questions. I will start with a review of the portfolio of activities which is considerably strengthened in energy and services due to the acquisition of ECOANS. This is for us an important step in the development of the Group. It places us on a new dynamic of growth, on a market which is in full growth, since Equance is at the heart of environmental transitions, industrial transitions, digital transitions, and which strengthens the group's resilience. On the slide and on the left ring, you can see the structure of the group before the acquisition of Equance, in which we had construction and service jobs. construction services because we had within Bouygues construction Bouygues energy and services which represented 75% of our activity in these 75% there were 10 points that were brought by Bouygues energy and services you have on the right part of the slide if we had to consider that we have achieved the acquisition of Equance on January 1, 2022 and therefore I take the figures We now have a sector of energy services that constitutes 33% of our turnover and ECONSE becomes the first business of the Group by its turnover and by its employees since we will have about half of the employees of the Group which will be housed within ECONSE. This is a great opportunity for development for the Group. At the same time, it is an important stage of integration because we have to integrate 70,000 employees with a double integration, the integration of Equance within Bouygues and the integration of Bouygues Énergie & Services within Equance. We will talk about all this this afternoon with the D-Mark Capital, which is dedicated to Equance, its content and its development ambitions. So the key figures that we have, I am in slide 5, it shows you the acceleration of the group's development with the consolidation of equances in accounts only in the fourth quarter of 2022 since we formally made the acquisition on October 4 of last year. Well, the year was a complicated one.

I remind you that the presentation of our results was made on the day of the invasion of Ukraine by Russia, so it was assumed that we might have... ...which led us to imagine that there would be geopolitical tensions, which proved to be the case, high inflation, interest rates that rose quite sharply, and high forex volatility. In fact, our various businesses took the necessary steps to adapt to this new environment. So group sales rose 18% over the year to 44.3 billion euro. The current operating profit from activities, COPPA as we call it, rose by 284 million to slightly over 2 billion euro. The net income attributable to the group was up 67 million. This is the bottom left. On the left-hand side, you'll see that we are restating the right-hand bar chart for the Alstom disposal. That was a one-off. So our net profit restated for that is actually up 67 million euro. Mechanically, of course, the group's net debt increased with the acquisition of Equans. Acquisition estimated at 6.5 billion euro. Then we bought back our own shares during the year for a total of €224 million. So if we factor out these two items, our net debt would actually have been decreased or improved, if you prefer, by €241 million over the year. So the guidance that we gave you when we started in 2022, we expect a new increase in sales and an increase in our current operating profits. That's not including equines, of course. On these two slides, you'll see how we fared. Sales were increased to €40.6 billion. That's not including equines, i.e. organic growth of 8%, a sharp increase. This was driven by good commercial performance and, of course, by inflation, particularly at Colas. Our current operating profit was strong at 4.5 percent of sales, enabling us to boost our current operating profit by 152 million to 1.845 billion euro. These results have enabled the Board to decide to propose to our AGM on the 27th of April the payment of a dividend of €1.80 per share. Remember that this dividend rose in 2021 from €1.70 to €1.80. On the second part of the slide, we've highlighted the fact that we have cancelled over 8 million shares in 2022. decreasing the total number of shares in circulation from 382 million to 374 million, aimed at compensating the potential dilution on capital transactions in favor of employees, which could take place in 2023. A few words about our sustainable and responsible initiatives, particularly the view to reducing our carbon footprint. Just an update on the various measures we've taken. On this chart, you'll see where we stand in terms of SBTI approval. Our target is to have all our businesses and activities approved and certified by SBTI. We began with reconstruction, big telecom, uh was uh approved in 2022 and then big construction big immobilia and tf1 were all filed in last year but they are currently in the process of being approved sbti the sbti process is taking longer because the large volume of applications made and finally equans Equans is currently calculating its global carbon footprint and will file for STBI approval in 2024. They will also be proposing how to reduce its carbon footprint in that filing. Now going to review our various operations, beginning with construction and services. Now, when we talk about construction and services, In this part, we have the big energy and services backlog, which from this year onwards will be booked to equants. It will no longer be booked to our construction business, which we will simply call construction, not construction and services. So our backlog is at a record level, standing at 33.8 billion euro. That was at the end of December 2022. Moving on to slide 13, if you look at the content of this backlog, It still includes big energy and services, but not equans. At 20.6 million, we have a good visibility for the future. That was at the end of 2022. For construction and civil works, this has increased despite less large projects in 2022, fewer awarded than in 2021 anyway. And the energy and services backlog is actually down 4%, which is evidence of the selective approach we've taken to projects. At Brieg Energy and Services, we have placed emphasis on margin rather than volume. And we'll talk to you about that at greater length this afternoon when we present our various indicators. Over the full year, 2022, Brieg Construction... So its order intake increased by 9% compared with 2021, largely driven by what we call normal course of business, which goes to show how competitive we are, particularly in the provinces. And in the second half of the year, this was driven by large projects like KVNA in Switzerland in Q3 for 474 million, and Kidia, which is an attraction park in Saudi Arabia in Q4 for 559 million euros. Real estate is a complex environment which became increasingly tense since last summer. Big immobility is still benefiting from the catch up on building permits which had dried up since the municipal elections in 2020. Let's say the bottleneck is gradually being released. Now the amount of time it takes to get works underway is getting shorter. The increase in interest rates have also had our boarding on the usury rate, which does have an impact on reservations. So Big Immobilia has decided to postpone certain offers, which means that mechanically the stock available for sale has been reduced and potential reservations are necessarily fewer. Broadly speaking, this is a wait-and-see market. And as a result, Brigo Mobilier's backlog is down 17% over the last 12 months. It should be mentioned that there are very few commercial property projects, very few commercial property projects being launched insofar as companies have not yet got a clear vision on their needs, particularly in terms of teleworking. Let me conclude with the backlog at Colas at 11.7 million, up 9% on 2021. This, of course, benefits from an order intake that rose 6% on the previous year. The backlog in rail projects has increased substantially. The Birmingham extension, construction of phase one of the Cairo Metro Line 4, or the five-year continuation of the network rail contract, or the railway lines in the south of England, Broadly speaking, the situation has been contrasted by region. In particular, I'm thinking of the low level of activity in Eastern Europe because of the conflicts in Ukraine, and an environment that was very much affected by inflation, which had a major impact on bitumen prices. Moving on to the financial performance of construction and services. I'm now page 14, incidentally. Sales reached €30.5 billion, up 9%. Now, of that 9%, it would be 4% organic growth, mainly driven by Colas. Colas' sales figure rose sharply by 17%. That would be 9% at constant scope of consolidation, constant exchange rates, driven largely by the impact of inflation. But inflation does play an important role. Reconstruction, it says, figures up 3%. Construction civil works rose 5%, particularly under the impact of international operations, while energy and services remained stable due to two reasons. First of all, the selective approach we are taking to projects and the transfer of our nuclear activities. It used to be carried out by Brigue Energy and Services. That's been now transferred to BTP, or Construction and Civil Works. Brigue Immobilier's sales figure, which includes our share in joint developments, is up slightly. I mention this notion of joint development because this is something we do to share risk with other developers. And, of course, this has an impact on the resources we use. so it's perfectly natural to take them into account. They are more representative of how the business is developing, but factoring out this share, our sales would have been down 4%. Current operating profit from activities, that's our COPPA as we call it, totalled €918 million. Reconstructions COPPA, rose sharply to €413 million, and its operating margin rose 3.1% from 2.7% in 2021. This is all the more remarkable that the year was marked by high inflation and a lot of uncertainty. The COPPA margin activities margin operating margin of our construction civil works business rose 40 basis points to three percent um abriga engine services reached 3.6 percent this is what we call diogenes plan that we'll tell you more about this afternoon So despite this backdrop of lesser activity, Brigue Immobilier generated its ROCA up slightly by 1 million euros. If you factor out this COPPA from joint developments, it was actually down 6 million euros. Collas has a COPPA of 468 million euros, up 21 million euros over the year. The COPPA in Q4 was up €21 million to €468 million. This was thanks to the plans of action implemented. Frédéric Gardès told you about these when we presented our interim results last July. Before moving on to equines, I propose we now look at a video about the construction of the wind farm, the offshore wind farm built by reconstruction of Fécamp. These are the concrete foundations that were put into the sea in Q3 of last year. I don't know.

That was quite a beautiful achievement, a beautiful project conducted by Bouygues Construction and its civil works division. Let's move on to slide 17 with the key figures for equants. This is rather a special year for Equance because a number of things happened during the year. First, we had to finalize the actual scope of Equance, Equance being the conglomeration of several companies within Engie. Then, of course, we had to separate these from Engie. And then there was some antitrust work. We had to get authorization from the European Commission, then pulling out Bouygues Énergie et Services, BYES, from Bouygues Construction so as to merge it with Equance, and that was done in January 2023. And then 2022 was also a significant year because that's the first year where we could recognize the transformation plan that started in 2021. Equance has now Equance not including weak energy service. Equance has an order book of 18.7 billion euros at end 2022. So this gives us good visibility on future business. Equance contributed to the group's revenue because it was acquired on October 4th, and so we had just about all of the fourth quarter to ourselves at week, and so it brought in 3.8 billion euros in revenue and 130 million euros in COPPA, in current operating profit from activities, of 3.5%. The pro forma data of Equance as if the acquisition had occurred on the 1st of January 2022, would have produced revenue of 13.8 billion euros, co-power of 278 million euros, a co-power margin of 2%. And so if you compare this with the announcements of Q4, you can see that the co-power margin was marked by seasonal effects, particularly felt in 2022. And then The net debt of Equance, which was about 400 million euros at the time of acquisition, was up to 24 million euros at the end of 2022. That's an outstanding performance by the teams led by Jerome and Etienne. I will not go into the details of Equance's figures this morning because this afternoon we'll have a whole session dedicated to Equance, its scope, its market. the structure of the company and the action plan that is being implemented so as to generate the performance expected in financial terms for equants. And so let us move on to TF1. Now, you had a presentation of the numbers by Rodolphe on the 14th of February. TF1 had a good operating performance in 2022. Revenue was up 3% at 2.5 billion euros. Nuen Studios was very much involved in this. It delivered a number of beautiful productions, one called Les Combattantes, and that was shown on TF1, but also Marie-Antoinette and Liaison. Advertising revenue was stable on the constant scope in 2022, up 2% on the constant scope in Q4, and that was thanks to the good performances of the broadcasting of the World Cup Football World Cup, but that was also helped by the French national team's performance. At €322 million, COPPA is down compared to 2021, but in 2021, there was the publisher's tax credit COVID-related, then that was 29 million euros. If you restate that for that factor, it was up. COPPA was slightly up. In any case, the COPPA margin stands at 12.8%. So what's the outlook? Well, top management decided to review the situation, appointed Rodolphe as chairman of the board of directors after Gilles Pellisson stepped down. So, well, Gilles now is the CEO of TF1, and so we can only thank Gilles for this transition, this fine transition with Rudolf Bernmer's arrival. The DTT Channel will continue its work. TF1 will be able to maintain its leadership with a current operating profit close to that of 2022. TF1 made an announcement concerning its dividends policy. saying that we are looking at stable or growing dividends for the coming years and the board of directors will propose a dividend of 50 cents per share at the next AGM. Let's move on to Bouygues Telecom now and take a look at the objectives, the targets set in 2022. For 2022 we were looking at revenue, build the customers up upwards of 5 percent, and that was achieved because now we stand at 6 percent. It was looking at EBITDA growth after lease of more than 6 percent. Now it is, in fact, 9 percent, not including the restatement of new frequencies. It stood at 1.750 billion, so that target was met. Gross capital expenditure was expected to be contained within 1.5 million euros, not including frequencies, and that was achieved as well. If you look at the total number of customers for both mobile and fixed, we have 15.2 million mobile contract customers, not including machine-to-machine, so that's up 450,000 customers over the year. Regarding FTTH, we have an additional 674,000 customers over the year, including more than 200 in Q4. And that growth was done outside the dense areas, that is, outside the natural catchment area, as it were, in areas where we had traditionally little business indeed. Finally, the FTTH footprint, as it were, has grown. Now we are in a position to market as many as 27 million premises. The objective was 25, and so we were able – sorry, we were looking at 27 million, and we actually were able to have as many as 29.7, so an additional 2.7 million over target. The target, the Internet now has become a sine qua non at home, what with COVID and telework and whatnot. So when you refer to the Internet at home, it's not so much the Internet as Wi-Fi. So it is indispensable to have high-quality Wi-Fi. And if you can do that, it means that you have good quality end-to-end. This is how a customer can assess the quality of their Internet access providers. And Bouygues Telecom has remained a leader in connectivity in terms of quality. It is the number one Wi-Fi operator for the second year running. That recognizes, of course, the quality of operations provided by Bouygues Telecom, but also the quality of equipment provided. designed and offered by Bouygues Telecom. And by the way, at the bottom of this slide, you have the type of equipment we're referring to here. You have to remember that Bouygues Telecom was the first operator in France with vertical boxes so that signal propagation can be Of course, when the box is vertical, signal propagation is better than when the box is horizontal. By the way, when the box is horizontal, people tend to put things on top of it. In any event, on this picture, you have the Wi-Fi boxes, the Wi-Fi 6E. model. We have an eco-design box, and that is certified by a German company called TUV. That's Wi-Fi 6. We have a 5G box as well, and that is 95% made with recycled plastics. And then on the right-hand side of the slide, you have a box offered by Kenyo, which makes it possible for NTP companies to have not just fiber but also a backup 4G access to provide good continuity of service. This one is horizontal, but you have little antennas at the back. to that send the Wi-Fi signal. Now let's move on to slide 25. The commercial momentum is robust. ABPU is up, and we have more customers, and so revenue is up. ABPU was up 30 cents over the year, year on year, to 20.1 euros, not including roaming. And that's mobile. For fixed, we are up 1.1 euros year on year to 29.5. So revenue in 2022 stands at 5.8 billion euros, up 3 percent over the year. Let me point out that the delta between the service revenue and bill to customer is the revenue from interconnection with other operators. That is down. That is down because there is less use of inter-operator traffic for voice and text messages. But that is offset by new OTT applications. We have other sales up 7 percent, mostly with contract work, and then EBITDA is now up 9 percent thanks to a good cost control. It stands at 30.4 percent, and we restated the way in which we looked at license fees for 900 and 1,800 megahertz frequencies in 2009 when we were granted these frequencies The license fees were recognized as operating expenses, charges, but now we line up with the common practice, which is to say that all operators do the same. This is seen as frequencies that were purchased, and so they are depreciated below EBITDA. And so, therefore, this means that EBITDA is up. 23 million euros, and of course the EBITDA to revenue ratio is improved as well. We – COPPA was up 93 million euros. Operating profit is up 72 million euros. That's 735 million euros in 2021. We telecom disposed of fewer, sold fewer data centers, and so there's less non-current profit. Looking at the outlook for 2023, Fabrique Telecom, well, we will enlarge a customer base. We will maintain capital expenditure to have more comprehensive mobile networks. We're looking at more revenue. EBITDA after lease about 1.9 billion euros, and gross capital expenditures should stand at about 1.5 billion euros, not including frequencies. I'll give the floor to Pascal Granger, who will give you a detailed presentation of the accounts.

Good morning. Good morning, everybody. Thank you, Olivier. I'm going to tell you about the group's consolidated income statement. I'm not going to dwell on the top lines of this income statement because they've already been commented by Olivier Rousseau. I'll explain business by business. Let me comment the lines below Coupa. So in addition to the PPA amortized at Kola, Tifona, and Big Telecom, Big SA for the very first time, amortized a further 13 million PPA arising from equines in Q4. In 2023, for the full year, this PPA amortization should represent somewhere in the region of 50 million euro for equans, but we'll look into this in much greater detail this afternoon at our Capital Markets Day. Non-recurring items totaled a negative 90 million against a positive 40 million last year. Now, the main reason for this is that the big telecom data centers generated substantial income last year. We have still sold a number of data centers for some 70 million euro. But we also have non-recurring expenses concerning M&A transactions and non-recurring provisions subsequent to regulatory changes. The cost of net debt rose to 198 million, of course, arising from the acquisition of equans, as Olivier said earlier on. So just for your information. For 2023, we expect financial expenses to increase because of the full year impact of the acquisition of equines. We believe that this expense will be in the region of 130 million euro before tax, or if you prefer, the net expense after tax will be of the order of 96 million euro. Moving down the income statement, We have booked a tax expense of 424 million, which is virtually stable by comparison with our tax expense in 2021, giving us a global effective rate of 27 percent after 29 percent in 2021. So very comparable. Finally, a 252 million euro decrease in the net profit of joint ventures and associates between the end of 21 and the end of 22. This was mainly due to the fact that Alstom did not contribute to 2022. Last year's performance was highly impacted by the capital gains from 219 million euro in sales of these data centers. There's also the dual impact of the Salto platform this year. We have the loss of activities in 2021 and, of course, the decommissioning costs in 2020-23. Overall, this will represent both the loss and the provision will represent some 46 million euro in 2022. So overall, this is with net income group share of 973 million. after 1.125 million last year. This is a decline of 152 million euro. But if we were just to factor out the impact of the capital gains on Alstom shares, the net result from group share would actually have improved by 67 million euro. Now, we have also drawn up pro forma statements for the group for 2022. This is based on the hypothesis of non-consolidating Q4 for equines, but based on the hypothesis that we would consolidate equines over the full year. This has the number of attendant consequences in terms of financial expense and, of course, in terms of amortization of PPA. So this acquisition generates additional COPA for the group, of course, but also additional net income if we factor out the impact of PPA, which has nothing to do with the economic performance of equine scope of consolidation. So at this point, equines, obviously on a pro forma basis, equines would actually dilute our margin on activities. As we saw earlier on, Ikhwan's profitability is not quite as good as that of the Uyghur group as a whole. Now, this also has a positive impact on not just COPPA, but also on net income group share that's before amortization of PPA. Let's now look at the group's financial structure and its net debt. As Olivier pointed out, The group's net debt at the end of the period amounted to 7.4 billion, after 941 million at the end of December 2021. I want to point out two important points. The impact of the acquisition of Equans, which was 6.5 billion. We've already communicated about that. And the debt was estimated at the time of the acquisition at 400 million euro. There's another factor that we also want to isolate. This is the buyback of weak shares, which last year totaled €224 million. Again, Olivier has already commented that buyback. Now, if we factor out those two items, equans and the buybacks, our debt would actually have been reduced by €241 million. That's a calculation, obviously. Now, the group's net gearing obviously rose to 53% while it was only 7% last year. But that was an extraordinarily low level, as a lot of analysts pointed out at the time. Even at this substantial increase in net debt, the rating agencies have confirmed our good ratings. S&P have given us an A- with a negative outlook. And Moody's have given us an A3 rating with a stable outlook. Over the next couple of pages, I'm going to tell you how our net debt has evolved over the period, not talking about equans or the buyback of our own shares. In other words, how we got from €941 million to €700 million, which would have been the case if we factor out those two items. I want to point several things out. First of all, net acquisitions, that's net of disposals, totaled €85 million. Now, there are a number of TF1 shares that were bought up by Buick, but also the disposals of TF1 over the period. But the biggest single factor is the acquisition by Collas of Hasselmann. Hasselmann is a German company specialized in the construction of railway tracks and infrastructure. We also paid for the 5G frequencies and paid the annual fees on the 900 and 1,800 megawatts frequencies for a total of €109 million. The dividend payout was €777 million. These are dividends paid by WIG SA, but there are also dividends paid by TF1 to its minority shareholders. Another very important factor that we mentioned several times in 2022, this is the intake of €723 million net of taxes. This is the amount we received from interest rate swaps closed out in 2022 to, well, largely in 2022. The overall impact of the swaps on our net debt was €831 million. Another important factor is the operations. Our operations generated €214 million. This is what I would now like to focus on in our next slide, page 32. Well, the first factor of change here is our net cash flow. That's including lease obligations. It was 2.088 million last year. It rose this year to 3 billion. Now, this is because of the increase in the volume of business and, of course, the COPPA. Net capex was well under control at 2.08, 2.09 billion. Our investments in WIG Telecom were maintained at the level we said they would be at. There was a slight increase, too, as I mentioned earlier on. We sold fewer assets at WIG Telecom. The final factor that I want to draw your attention to is the change in working capital requirements. which was a deterioration of 727 million euro. Now, our working capital requirements are never stable from one year to the next. Some years it's up, some years it's down. Sometimes there are objective factors. This year at Colas, for instance, the cost of bitumen rose, which means that for an identical same level of stock, the value of your inventory increases. There's also the change in levels of business. as a result of which customer receivables are higher than they were the previous year, for example. I'd also like to point out that these 727 million, the change in the year, is to be compared with a positive change of 321 million last year. And I think I remember it was 550 million. So you can see how working capital requirements fluctuate from one year to the next, which is perfectly natural, and in particular in construction. Concerning working capital requirements, I would also like to point out that at the end of the third quarter of 2022, we identified the issue and told you that we would draw up a plan to considerably improve the figure at the end of Q3. This is what we did because in the fourth quarter, There was a sharp, very sharp turnaround in Q4 with the working capital requirement improving by 2.3 billion euro. That brings me to the end. Olivier, you have the floor once again.

Thank you, Pascal. And now, let's consider the outlook and our priorities for 2023. No surprises there. The number one priority is, of course, to successfully bring equans on board and, indeed, the merging, as it were, of Bouygues Energy and Service with Equance and outside Bouygues Construction, then you'll have a performance plan that will be introduced this afternoon to us to improve Equance's own financial performance. Then we will of course, be there to support the various businesses in various ways. And then the number three priority is to continue our line of action for climate and, in particular, our efforts to reduce our carbon footprint and, indeed, reduce the three B scope, which is, of course, the heaviest, as it were, in the company. What's the outlook for the company? Well, there's lots of instability, instability, high interest rates, the volatility of currencies. And so in that context, we're looking at revenue that should be close to that of 2022 and but also in improvement in COPPA, that is current operating profit from activities. Now, when I say that the figures should go up, we are looking – we're working on the basis of a pro forma for 2022 on the assumption that equants was acquired on the 1st of January 2022. So we're looking at a revenue of 54.4 billion euros and current operating – COPPA of two – billion, 164 million euros. That's the pro forma. A few events, coming events this afternoon here at 1400 Hours Capital Markets Day, 25 April we'll have the – 27 April, sorry, the AGM, and then there will be a number of other events on our site. This completes the presentation. Thank you for your attention, and I will be happy to take your questions along with members of the week's top management. This is a call from HSBC. Thank you. Good morning, everyone. I see that there's no guidance for construction, even though Q4 was pretty good. How do you see international domestic demand for big projects, and where do you stand in terms of your ability to pass on higher costs to your customers? And then is there a... normative margin level for reconstruction in view of inflation precisely. I have another question on the WCI. As you pointed out, you returned – well, you reversed the trends of gains of the previous years, but that does reflect a positive performance of equants to $210 million. So pro forma, the situation seems more challenging? You said there were gains in 2021 and then factors that deteriorate in 2022. Can you give us details, some color as to how these factors might change in 2023? Well, let me take the question about 2023. Pascal wants to take the microphone out of my hands. Well, please go ahead then, Pascal. Be my guest. You do need a microphone, Pascal. Well, I can take part of the question. You have to go to the bottom of the steps. Otherwise, nobody can see you. That's where you can be seen. Thank you. So you had a question about the market on major infrastructure projects, well, that market remains buoyant in France. Well, we have the Greater Paris project. You have some issues of transportation infrastructure in the north of France as well, in Toulouse, their airport. where we might have a chance. Also, there are mobility and energy services abroad, low-carbon energy. You're looking at solar power plants, wind turbines as well. You had the FECOM project, plus nuclear, of course. And we are involved in the Clayport Nuclear Power Plant in the U.K. But that's the U.K. But there are other countries where we do have a presence. Likewise, for mobility projects, metro, trains, and other forms of transportation, this is a market with a high demand for big projects. Right. And regarding the normative level of margins, well, of course, the market is not in a normative environment for the reasons I cited. And so there are a number of things that will be done at reconstruction to be more selective in terms of projects, to be to do whatever we can in business line to target our offers more accurately. We've been working with key account managers at Reconstruction We do all sorts of things to protect margins, but at this point, again, this is not a normal environment. Too many things are going haywire, as it were, and there are things over which we have little control indeed. Mr. Granger, you want to add something? Yes, as regards WCR, you rightly point out that there are fluctuations from one year to the next, and that's the very reason why we're not giving guidance here on the earth. Otherwise, we would be making assumptions on things we have no control of. But it is part of the group's DNA to work on WCR. We may remember at Bouygues Construction, there were a number of steps taken to keep that under control. In provisional terms, all I can say that our people are working on that, and not just at TF1. In all businesses, Collas, Bouygues Immobilier, Oh Indeed, TF1, we are all – all our teams are mobilized to address the WCR level. But we are losing ground on license fees because the 5G licenses are paid off over several years, and so year after year, that means that, of course, this comes to the detriment of the WCR. So we cannot give guidance, but we're not anticipating any major challenges there. Thank you, but you will discuss this this afternoon. But regarding equants, how can you read the Q4 WCR performance? There's a lot of seasonal factors. You could well imagine a positive contribution. Well, yes, we'll be discussing this this afternoon in greater detail, but one thing is for sure. If you look at our plans for equants, we want to improve WCR. The improvement in Q4 was, of course, significant, and there are a number of seasonal factors. Nonetheless, the medium-term trend for WCR is improvement within the equance scope. Thank you, sir. And the next question comes from Mr. Mathieu Robillard from Barclays. You have the floor, sir. Well, thank you for this presentation. I did have a couple of questions. Number one, regarding your rating, you said that in the presentation earlier on, the S&P rating, and looking at the statement published in September, you said that top management was considering a number of smaller acquisitions, but that would add up That would be a – that might also go with an asset sale. Can you give us details on that, or is that just general expectations, or can you give us details? That was one question. The other questions about the telecoms guidance, are you including, well, the higher, the increase in rates? But how does that reflect if you have higher prices? How will that reflect on the accounts? And then the final question on Colas' backlog in France. There seems to have been adjustments at the end of the year. Was that – what's the part of volume in that and what's the part of price? Okay, so we'll have a three-person answer on the S&P rating. A reference was made to disposals on the S&P statement. Well, in our company, inevitably, there will be some small acquisitions considering the number of businesses we can expect some external growth. but nothing major on the map. Regarding now – well, you're referring, I believe, to acid-based – Equance's acid-based activities. When we brought back Equance's scope, there were some acid-based activities that were – as it were, acquired on that occasion. And we may well dispose of these assets. Indeed, we started the process a few days ago just to test the waters, as it were, to test the markets. But we'll tell you more about this this afternoon. But I think that is what S&P was referring to. On telecom, while the guidance is in line with our own expectations on revenue in view of our plans for the year, of course, with a larger base, we can expect a larger revenue. That's basically all we can say. And that's basically it. And then Frédéric will give us the answer to the third question. Yes, on Colas' backlog in France regarding Colas Rail, that has declined a bit, but that's because we've been very selective with the deals that we do take. On roadworks, there was a... well, a small decline in volumes in industry in 2022, but that was offset by higher prices. So all in all, we remain stable. The roadworks order book is looking up. And, well, it's stable if you restate that for inflation, but we are on a positive trend right now, and so we have no concern about markets now. Thank you. Thank you, sir. And the next question comes from Eric Ravary from CIC. You have the floor, sir. Good morning, everyone. I do have three questions as well. On CapEx, can we have an order of magnitude on the pro forma basis? How do you compare 23 to 2022, not including telecoms because we already have a guidance for that? Another question on weak telecom this time, the dispute with the free and the ruling by the by a court to have, what was it, the 300 million payment, are you going to appeal that ruling? And then what's your policy in terms of provisions? And then the last question, a follow-up question on COLAS. The order book, the backlog is up 7% for COLAS at end 2022. Any idea of the part of price? and volume for the order book well start with the long answer benoit will give you uh the details about uh the uh litigation with iliad well between big telecom and iliad well the one thing that you should know that we are challenging uh the courts uh ruling that is one more episode in a line of action conducted by free against the three operators for the past 10 years. They do not want to carry subsidized offers, even though they're perfectly legal. So, of course, we're challenging the decision. We appeal the decision, the ruling. And we believe that the offers are perfectly legal and they have been confirmed by European legislation. So we're well within our rights when we have these subsidized offers. Right. Pascal on CapEx. We do not provide guidance on CapEx yet. except for Bouygues Telecom. Bouygues Telecom being the largest consumer of capital expenditure, so the guidance for next year is pretty much the same as this year, 1.5 billion. You can see that year after year, Bouygues Telecom has been able to give a pretty accurate guidance. On the construction business, we may be having more capex in 2023 compared to last year because we're starting a number of major projects. There could also be additional capex at Colas, and that is because there will be receiving the two bitumen vessels that they ordered last year. But usually capital expenditures often met with advances on works invoiced. And then the last question, the price volume mix on order books. Well, if you compare order books from one year to the next, well, if you have a large order coming in at the end of the year, it makes comparison a bit difficult. And what is attributable to a commercial policy, what is attributable to inflation is hard to tell. But about France, that's what I was saying earlier on. North America has been very dynamic, and you can see some of the effects of the Biden plan, and we are very confident on volumes for 2023. Conversely, in Central Europe, The road business is, well, at a standstill because of the Ukraine situation, plus inflation is higher here, and this may well have impact on volume. So the order book remains high. There is some inflation there, but, of course, we have been taking a number of projects as well.

Frédéric?

I'd just like to clarify a point concerning the dispute with Iliad. You have nothing to pay until the appeal has been ruled on. Is that true? No, no, no, not true, I'm afraid. What I said earlier on, I'll repeat it, is that we have appealed the ruling. We've also contested the provisional execution of this fine. So you do have over 300 million to pay out. Yes. 308 million to be precise. We have no other questions from France. We have now a number of questions in English, I believe.

To ask a question, please press star 1. We'll take the first Question from the English side from Alex from Bank of America.

Good morning and thank you for a question. I have a question on construction, one on Colas, one on telecoms. In construction, what benefits do you see with the Paris Olympics in 2024? Is that already built into the guidance? Concerning Colas, I've noticed that the margin seems to have benefited at holding company level. That would appear to be the benefit of a number of asset sales that you've mentioned. There's also a margin at zero in the U.S. I suppose that that is because of inflation. And the cost base, can we expect a drastic improvement in the years to come, or will this span several years? And finally, in telecoms, You talked about an 80% acquisition in the high-density area. Are we talking about fiber acquisition? Are we talking about acquisitions in fixed lines in general? Now, I'm going to answer your question about construction, the 2024 Olympic Games. First of all, we have been involved in two projects, the Olympic pool for diving, which is just opposite the Stade de France. This is a project that is well underway. In fact, we've already installed the platform in the pool center. We have a second big project north of Paris, which is called the Arena. These are orders we took in several years ago. So we have nothing up and coming, which is just as well, given the fact that the Olympics are in 2024, and it takes time to build these things. Thankfully, we have nothing else in the pipeline. Then you had a question on margins at Colas. I see Frederic scribbling his answer. Frederic, you have the floor. Well, if I heard you clearly, there were two parts, one about the U.S. and another at holding company level in the U.S., As is often the case in the U.S., things happen more rapidly and more suddenly, more violently than elsewhere. Yes, we were quite adversely affected in the first quarter. So, overall, if we add in a few one-off difficulties that have since been resolved, yes, this was a year where our performance is not as good as we expected. As for the holding company question, well, with sales increasing quite sharply, We have more than covered our general expenses, which are quite high. However, you're quite right. There is also a contribution from the asset-light plan that we implemented a few years ago, which is aimed at releasing cash. That is tied up in non-strategic assets, and this is cash that we release to use at elsewhere. So that has also contributed. The details of your acquisitions, Benoit, if you would say about that, returning fixed lines, 80 percent of our growth is in fiber. Outside of the high density, it's in the medium density and the public initiative zones. So thanks to fiber and thanks to our quality of execution, we have strong growth in areas where traditionally Greek telecom was not as strong. So fiber, yes, has certainly been very supportive of us. FIBR is really a means for BRIC to increase its market share, particularly in areas where we were not present in ADSL because we simply decided not to develop our own infrastructure. Not so with FIBR because we are looking at 30 million premises connected to date.

Society General.

Hello, everybody. I hope you can hear me. It was a quick question, firstly, on telecoms, and then secondly, just a quick explanation on equans, and I hope you can maybe answer that. But firstly, on telecom revenue for 2023, you've not given a precise target for revenue. Do you suspect... Top line may be a little bit softer this year, or is this just a question of sort of semantics that you're not going to give an actual number for guidance? And your guidance for EBITDA also seems pretty precise. It is 7% or so that you're implying. So, you know, what's the outlook in terms of sort of staff costs, energy, and also the wholesale rates on copper, which Orange is talking about lifting? Could you just describe the moving parts, please? And the second point was just a very quick question. explanation of your phrase strong seasonality at equines could you just explain that point i mean if it's just q4 margins were stronger than the rest of the year fair enough but was it something else you were trying to get across thank you well one quick one benoit on

Telecom's guidance is that sales will be higher than in 2022. Now, you can call that imprecise if you like, which I would understand, but do remember that we are an inflation context with very strong competition. We don't want to be giving indications about what our price policy might be for the year. This is the fundamental reason or one of the fundamental reasons that we are less precise about sales. As regards EBITDA, our guidance is a little more accurate at 1.9 billion. To break that down, I'm not going to go into details, but do bear in mind that we are intensifying our value creation strategy. Again, to answer your question about the impact of inflation, we are rolling out a policy to control costs in all areas. So it's this twofold strategy of value and optimization of costs that gives us a guidance that will be up clearly on 2022. As for the seasonality of margins, up to now, we've had a relatively seasonal business with Codas. In the first quarter, we have not a lot of business costs, but not a lot of sales. Now, with Equans, we have a business which is also seasonal. Jerome, would you like to say a few words about the variations in margins over the few years and why Q4 is higher than other quarters? Yes, we have seasonality every year. This is mainly due to the impact of weather on outdoor works. That's the first impact. We have also got another form of seasonality that exists in our businesses, but I'll elaborate on that this afternoon. Next question. Thank you, Johan.

The next question comes from Sam McHugh from BNP Paribas.

Thank you, guys. Thanks for the presentation. I understand you don't want to give away the specifics on pricing strategies in telco, but have your thoughts on kind of balancing customer growth and pricing change at all in the last 12 to 18 months? You know, the market does seem to have cooled down. Do you see any benefit from being, you know, a bit more focused on pricing versus customer growth? And then secondly, just a clarification on the accounting change. Is that 23 million benefit just a Q4 benefit? It's not a similar benefit to anticipate in the first three quarters of 2023. Thank you.

Okay.

You're talking about the new accounting, that new way of accounting frequency costs. Here I'm speaking on behalf of my colleagues. That is that they are no longer considered as expenses. They are found below EBITDA because they are deemed to be debt. The second part of the question, to be very frank, I didn't understand a word. Did somebody understand? Can I call a friend? On which part of our business? On Brick Telecom. My apologies. Yes. Now, I believe I heard the question. The first part of the question concerned, could we be more specific about our sales guidance? Once again, there are fewer promotional drives in the French market in recent years, and that's true. And I can confirm that. In the last three or four months, There's fewer promotional drives, be it in mobile or fixed lines. So the prices are on the increase. That's what we've seen. Greek Telecom has adjusted its own prices on the customer base and on customers acquired. So, yes, this should feed into sales for the year. And what about the next few quarters, as I said? Well, it is a very strong competitive environment, and we have nothing to announce just yet as regards pricing. I think there was actually a more specific question about the increase in EBITDA. Is there a full-year effect when we look at frequencies over the full year? If so, does 23 million... Is that specific to T4, or can we expect that to recur over the full year, if I fully understood the question? And the answer is 23 million euro was in Q4. The whole year was booked into Q4. And it will be 23 million over the full year 2023. We booked that amount just to Q4 last year. Thank you.

from Jacob Bluestone from Credit Suisse.

Hi, thanks for taking my questions. I've got two, please. Firstly, can you maybe expand a little bit on the decision to move to COPPA from current operating profit? Why do you think that's the right metric? And why are you not booking the PPAs in other operating income and expenses? So you can maybe just clarify that. And maybe if you can also give a little bit of guidance for what we should be modeling for the PPAs. And then just secondly, on the telecoms business, historically you had a fairly sizable exposure to roaming. Presumably it was a significant tailwind in 2022. Can you maybe just quantify how big a tailwind for either revenue or EBITDA was roaming in 2022? Thank you.

Before we get the precise figure, because roaming has declined since COVID, could I ask what the impact was on 2022? Well, concerning roaming, during the COVID years, 2021, roaming decreased very sharply at Brick Telecom. What we found in 2022 is that roaming is gradually coming back to pre-COVID levels, particularly with the public at large. People have started traveling again. People are traveling around the country. So roaming is almost at the same level as before COVID. However, in B2B, Clearly there's been a change of behavior on the part of companies, and even though some companies have opened up again and there's more and more traveling, people are working remotely. So roaming in B2B is somewhere between the pre-COVID level and the level it dropped to during COVID. I hope that it will improve again this year because there are more and more countries opening up, and I'm thinking of China in particular. But in B2B, I think something has been a structural change insofar as employees are traveling less and working more and more remotely. I should add that concerning roaming, we're very much impacted by what happened in the U.S. and Asia. Europe is very small in terms of gains. Concerning our key performance indicators, how we've changed them and how you should do your modeling, I think maybe Pascal Granger will be the person to answer that question. Yes, we decided to change this indicator and started publishing it from Q3 of last year with the view to preparing for the inclusion of equants. And we decided to do this because we felt that the amortization of PPI is not representative of the performance of our businesses. And it's not representative of Equan's performance. So we wanted to give you the best possible vision of the economic performance of our businesses. This is why we've decided to calculate COPA while factoring out amortization of PPA. From the point of view of modeling, it's quite straightforward. For 2022, we have 56 million in PPA amortized. 56 million of that amount, 13 are equines related, meaning that next year we'll have the equines impact for about 50 million and the impact of our other businesses for a little over 40 million. These are figures that are in decline, though relatively stable, barring further acquisitions. Thank you, Pascal. Next question.

question from Jerry Dulles from Jefferies.

Yes, good morning. Thank you for the presentation, and thank you for taking my question. I have two questions on telecoms, please. Mobile service revenues for Buick Telecom have been extremely flat every single quarter through 2022, and the mobile app trends adjusted for roaming have also been showing rather stable and low levels of growth. So how do we see this better pricing environment in French telecoms actually being sort of reflected in revenues? Is there an offsetting effect somewhere else, please? Then my second question has to do with your broadband business, where obviously revenues are growing at a very healthy rate. Do you expect to sort of sustain that level of revenue growth into 2023? And could you please comment on how your broadband customer base is distributed between the urban areas and perhaps more rural locations where you're getting access to customers for the first time leveraging your fiber reach? Thank you.

Your question is quite complete. We have brought in a start-up response.

That's quite a detailed question. I said we give you an initial answer, which was that 80% of the connections were in areas that are not tense, in regions where we were not really present. So this has really led to an increase in market share. Maybe Benoit would answer the rest of your question. Concerning mobile, the services sales figure includes services billed to clients, which is on the increase, and what we call incoming revenue from interconnections. So that is not growing as sharply because that is actually on the decline for two reasons. First of all, the prices that operators pay one another. for incoming calls that are decreasing year after year. There's also the volume of messages or even calls that are currently being replaced by messages on WhatsApp and company. Now, this decline in incoming calls, which still has no impact on EBITDA, because at the same time, We are paying other operators less for these interconnection costs for our clients phoning into other operators. So in terms of EBITDA, it's completely neutral. This is why our guidance is based on sales invoiced to clients, which is an indication of the number of clients and the individual amount paid by each client. This figure is increasing substantially in mobile and even more substantially in broadband. That's because in broadband, we are winning over clients. Our positioning is gathering pace in our traditional regions, but also in new, lesser-density regions where they switch over to the rollout of fiber is enabling us to gain market share. So the broadband gains are higher than in mobile and will continue to be higher. Thank you, Benoit. Have we another question? No, there are no more questions. Okay, let me thank you and see you all at two o'clock for our Capital Markets Day, which will be devoted to equine.