Tecnicas Reunidas Sa Ord

Good morning, everyone, and welcome to TR's first semester results presentation. It's going to be conducted by our chairman, Juan Gallo, and our CEO, Eduardo Samuels. It's going to last about 15 minutes, and you will be able to post your questions after the final remarks. And now, I'll give the floor to Juan Gallo. Juan Gallo.

Thank you, Antonio, and good morning, everyone. Thanks for joining us today. on our first half results presentation for 2025, where both Eduardo San Miguel and I will guide you through all the most relevant issues that have taken place this first half of the year 2025. And first, as usual, I'll share with you a glance of our business performance. And Eduardo will follow the presentation, finalizing with the financial results. And as usual as well, I will do a wrap-up with some financial final remarks. So let's move on with the business performance. Three big numbers here. First, let's talk about our present. Our present are the $3.8 billion of ordinary take. Ordinary take with extremely good quality EPCs and a very healthy economy. mixed with technological engineering services, very much in line with our focus and our strategy that I will talk about later on. Second number is our immediate and healthy visibility for the next years. That's the year-to-date backlog, 13.1 billion of healthy backlogs. This is our visibility. And third, which I think is very important now, this is our real future. This is our future with a very strong and selected pipeline. A strong and selected $72.3 billion for the next two years. The pipeline is not only the future pipeline or the jobs that we are already leading, that we have been already pre-qualified and getting ready to bid, or that we have been invited to bid, and we have to answer whether or which jobs do we want to bid. And it's a big number, and let me tell you, it's a very healthy number. And it does represent, as I said in my note, a very positive environment. We are working in an extremely positive environment. But also it's very important because you have to get invited to bid. It also represents the value of TR's franchise, which is nowadays very strong. So let's focus on what has happened this quarter in terms of award. And I'd like to focus on our service unit, our service business. Let's focus on the more than 120 million, almost 130 million euros awarded this last quarter. And I'd like to, you know, stress or send three messages. A message of engineering quality and engineering capacity. A message on technology. And a third message on credibility and trust with our industry leaders, which are defining their future and we're defining with them our future as well. So let's go over these four very important jobs. Our joint success with Tyson Group, which everybody knows that it's an industry leader among many chemical disciplines. In this case, fertilizer leader, fertilizer discipline. We joined them with our own technology for a big, big-size fertilizer project. project that we cannot discuss. Customer cannot discuss. We can discuss, and we are partnering with Tyson, which is with this group, which is an owner, and I'm sure we're going to do a great job together. 65 is our scope. 65 million is our scope. So this is a big job, and very technological and large job. Second, Our successful result in large, quite large, clean fuel front end for more than 35 million euros, which shows we very much focus and align our service strategy. It reflects, again, our engineering technology and credibility. 35 million euros on front end, if you compare with all the ones, it's a big job. Third, and this is very important, which reflects TR's technological credibility in the region, is a very large, you know, that we're going to be working for a very large Middle East national oil company, which that company has entrusted TR for the digitalization design of some other facilities. Again, engineering, capacity, technology, and credibility. Very important. And the last one, which is probably the most important one, we've been awarded by ACWA power with the front end, with the rollover possibility or opportunity for the largest green hydrogen, green ammonia investment in the world. And let me move to the next slide because I think this job, And this award deserves just this slide by itself. And it is, as I said, an important slide because I think in this slide with many words and numbers and it summarizes in itself full TR's strategy. It is, this is the Southeast strategy. that we presented to you about a year and a few months ago. This is a strategy which shows that we fully focus on customers and market. We focus in Saudi Arabia, where we have delivered many jobs from petrochemical, gas, power now, for Ramco, SADIC, SEC, and ACWA, and now we focus with ACWA. ACWA, this is the third job that we're going to be working for them and with them. The second message here is that we are engineering services. Engineering services and very much focus, as you can see here, in low-carbon focus. This is our low-carbon focus strategy. within our strategy is that we continue focusing on working with the strategic partners. And in this very specific case, our strategic partner, Sanovec. This is the third job in Saudi Arabia, and as you know, we're working with them in other different regions around the world. This is a successful, it's a good partner, and it's a very successful strategy. And all these three very important messages on which converge the full strategy, you know, wrapped up within the largest ammonia plant in the world. The largest ammonia plant in the world that is labeled by the Saudi authorities the Saudi Europe Corridor. Saudi authorities are developing the largest investments in the world with the agreements with the European buyers to build the largest corridor in hydrogen, green hydrogen and ammonia. And for that investment, which is huge, you know, they have decided and we're proud to be that TR will be one of the players. together with a very good partner, Tanopec. And now with this message, Edardo will continue with the presentation.

Okay. Thank you, Juan. Good morning, everyone. In the previous slides, we have seen that it seems we have broken a glass ceiling. We have been fighting last year to be considered by our client not only as a good EPCist, but also as a company that can render solidly pure services. And we have succeeded. Now, it is time to revisit the effort we have been doing in the past to adapt our workforce to this new scenario. And again, we believe we have done the job correctly and we are ready to absorb all the new activity that will demand our new only services business line. Our workforce will reach 13,500 employees by the end of 2025. This represents a 60% increase in the last two years. We are strengthening our engineering capacity across all our key locations. In our headquarters in Spain, our main hub, we are already close to 6,000 people. 90% are engineers. In India, we have concentrated our efforts, searching for fresh quality engineering and competitive costs. Early 2026, we will have more than 2,000 people in our offices of Bangalore and Chennai. And we continue to strengthen our engineering offices of Emirates and Saudi Arabia with the purpose of being closer to our clients. The good news is we still see room for growth in all those geographies. We have the talent and we have the capacity needed to execute our business plan. Let's now take a look at our financial performance. But let me first point out our figures. Our figures have improved once again. It is the 12th quarter in a row of growth. And what is more important to us, it has always been aligned with our previous guidance. The numbers. Our net sales have reached 1.4 billion euros in the second quarter. This represents a 32% increase compared to the second quarter of 2024, and it's a reflection of our solid 13.1 billion euros backlog. Regarding our EBIT for the second quarter of the year, it has increased to 64 million euros, reaching a 4.5% of our revenues. 64 million euros is the highest ever quarterly EBIT delivered by TR in its history, and the 4.5 margin is fully aligned with our guidance for the full year. The EBIT improvement is a consequence of a solid operational performance, the implementation of risk mitigation measures, and a commercial strategy focused on being very selective. So, finally, solid numbers in terms of revenues and margins. Let's now take a look at our balance sheet figures. Our net cash remains at 422 million euros, a level where we feel very comfortable since it allows us simultaneously to grow but also to manage efficiently our business. There is a threshold of cash needed to provide comfort to our clients and banks. But beyond that threshold, our policy is to inject as much cash as we can to our suppliers and subcontractors. There are two main benefits of this policy. Better terms of payment improve dramatically the ability of suppliers and subcontractors to execute its scope of work on time. reducing significantly our risk of delays and potential penalties. And obviously, we can also agree more favorable purchasing conditions, mainly volume rebates and priority delivery slots. In summary, cash allows us to manage the business efficiently. And regarding the equity levels, we ended the semester in a robust position of 654 million euros, including CEPIS TPL. Let me remind you that our primary goal was to reach pre-COVID equity levels, and that has already been achieved even without the CEPIS TPL. And finally, I would like to give you some color about two relevant issues we cannot still provide you full visibility. Revenues. It's a fact that the revenues are growing above our guidance. If we repeat the volume of revenues we had last quarter during the second half of the year, we will have around 5.6 billion euros this year, 2025. The main reason if many projects are required to be accelerated because our clients are demanding it. We are currently negotiating compensations for some of these accelerations as a prior step to accelerate. We expect to have a complete understanding of this agreement by mid-September and the final figure of revenues can be even above those 5.6 billions I mentioned before. But the most accurate revenue guidance for the years 2025 and 2026 will be provided last September, early October. And regarding the SEPI loans repayment, my message is this is not a financial matter anymore. It is a strategic decision that we will take after summer. We still believe SEPI support is useful with certain clients, but obviously, we also want to repay CEPI quickly in order to reduce the financial cost and to pay dividends. So in both cases, we're talking about potential good news in the second half, but for the time being, we want to be realistic and accurate. And now let me give back the floor to Juan for the final remarks.