Tecnicas Reunidas Sa Ord

Hi, good morning, everyone, and welcome to TR's full year 2025 results presentation. It's going to be conducted, as usual, by our chairman, Juan Yadó, and our CEO, Eduardo San Miguel. It will last approximately 25 minutes, and you will be able to pose your questions after our chairman's final remarks. I now leave the floor to our chairman, Juan Yadó.

Hi, hello everyone. As usual, as Antonio has said, Eduardo San Miguel and I will guide you through these most relevant points that we're going to be covering in the presentation today. I will first walk you through the main financial and commercial milestones that we have achieved by this 2025 year. And all of this will be very much enhanced by Eduardo with much further detail and color. Eduardo also will continue with the financial section of the presentation. And finally, I will conclude with some financial remarks. Thank you. This is different than other presentations. Let's start, which I think is a real highlight, with the financial performance of TR. Financial performance in 2025, which has been extremely solid and has definitely exceeded all initial expectations from the very beginning of the year. As shown in this slide, 2025 sales reached 6.5 million euros. representing 45% increase compared with the 2024, and therefore exceeding the guidance set for the year. If we move to the EBIT level, 2025 reached 291 million euros, which is 61% above 2024. which results in an EBIT margin of 4.5%, very much complying with the guidance established for the year. Nevertheless, that's important to note as well, we gain, in nominal terms, 57 million euros above our initial goal, which is due to the sales increase. And finally, net profit amounted to 156 million euros reflecting an increase of 75% compared to the previous year. After these results, this performance has resulted, as you all well know, in early repayment of our SEPI loan, which finally took place last December 1st. This repayment of the loan has given us the financial flexibility to return to the shareholder remuneration policy. We give them payments resuming again this 2026 year results. And this is new as we never start with guidance. But with these solid financial foundations I'd like to anticipate our guidance for 2026. We do expect sales to exceed 6.5 billion euros with an EBIT margin above 5%, which translates into more than 325 million euros. Our guidance for net profit is projected to reach a neighborhood of 200 million euros. But it is important to note that the EBIT grows by more than 10%, from 291 to more than 325. And it is also important to see that net profit increases as well by more than 20%. However, this 2025 has not only been a year of outstanding financial results and very good execution and performance, but probably I think it is more important that 2025, it's important to say and to explain to all of you has been a year of quality of positioning and has been a year of a real inflection point. In 2025, we have managed to place TR where we wanted TR to be. And let me go through why. First, we positioned TR as a much stronger company in the Middle East. Second, with the leadership in the power business. Third, confirming TR as a trusted engineer service partner. And four, and this is very important, a very strong foundation in North America. And before Eduardo gets into details, let me give you some examples. On March 25, it was very well announced, we got the award of the Lower Zarcombe Project for 3.1 billion euros. We have been present for more than 20 years in the Middle East. But now, today, I can confirm that we are positioned better than ever. We have strengthened this year our leadership in the power business. We have a strong backlog. And with the expansion of the combined cycle in Saudi Arabia, together with the new job for RWE in Germany, we talk in Saudi Arabia and we talk in Germany, That confirms that we are in this business well-positioned to grow. Our engineering service has closed in 2025 with an award of €333 million. And this is remarkable. This is a remarkable milestone that was defined only two years ago. But most important and very important, is that of these 33 million euros, more than 70 have taken place in North America, which confirms our quality and definitely our growth potential. So all I wanted to do this introduction of financials, our guidance, our positioning, and now I pass the floor for Eduardo to continue with the presentation.

Good morning, everyone. As Juan has explained, year 2025 has been a year plenty of solid achievements. Repayment to CEPI, best ever EBIT, we're feeling the battle with a strategic new project, but there is also a deep transformation process inside GR moving forward that supports these achievements and is slowly reshaping the future of Técnicas Reunidas. There are a number of drivers for this transformation, but I want to focus on four of them. First, expansion of our services business line. Second, our new strategy for the power division. Third, the leadership we are settling in digital, artificial intelligence, and robotics. our presence in the geographical areas with the highest concentration of future investments. I will cover in the next slides where we are in those four drivers, but let me first devote this slide to explain you why it is a real game changer. Expansion of the services business line obviously delivers a volume of profitable and less risky projects. but it is also the way to enter into the U.S. market and to keep on working in the world of energy transition. The new strategy for power that has to do with the spin-off of our power unit that we expect to be completed before summer, well, you know, has a purpose, and its purpose is to maximize the opportunities for this sector based on more resources devoted and more focus. Through investing in artificial intelligence, digitalization, and robotics, we will get cost efficiencies. We will increase our competitiveness, and we will generate opportunities to deliver digital services. And most importantly, it will contribute to redefine how our clients perceive us. And eventually, to complete our footprint with a solid presence in the US was a must last year if we wanted to capture immediate future investments. And we have succeeded in consolidating our presence in the States. Together with the Middle East, we are where we want to be. So let's go one by one. First, the engineering services business line. 2025 figures are good and also promising. €333 million in awards. More than 40 new contracts signed. A total of 11 frame agreements signed with major clients. 23 new clients we have started to work with through this business line. And the revenues amounted to 254 million euros, halfway to our 2028 ambition of 500 million euros of revenues. And margins are in the range from 25 to 30%. So, it has finally been a very, very good year. Second, artificial intelligence, digitalization, and robotics. We launched months ago a project called We Imagine the Earth. And our conclusion is we can fully transform the way of doing projects. It will take time. But in the meantime, it's an unlimited source of cost efficiencies. What is clear to us now is it is time to invest and we will do it. That is why we have decided to increase our investment up to 35 million euros per year from 2026 and onwards. And that is why we are planning to more than double the staff devoted to develop our programs. More than 400 people will be involved in digitalization and robotics by the end of 2026. And also, this investment will be partially paid by the clients because digitalization is becoming a source of services contracts with our clients. In fact, we have already contracts amounting 65 million euros and another 50 million euros under negotiations. And regardless if it's paid or not by the clients, digitalization robotics are the finally again changer in our sector. From civil works, structures, electromechanics, procurement, site and product control, everything, everything can be digitalized. In fact, around 60% of the man hours in our sector can be automated with today's technology. Our internal estimation is we can capture 200 million euros per year in cost efficiencies. That will be translated into better margins or more competitiveness depending on the market situation. In any case, we will invest. We have to be ready for the future. The third driver is the power sector. $100 billion is expected to be invested annually by our clients next decade. And we have a business unit that has installed 25 gigawatts in the last 20 years, creating a unique relationship with the four existing turbine suppliers, GE, Mitsubishi, Siemens, and Saldo. In our October Investors Day, we fixed our target of revenues in 1 billion euros per year. It is not a major challenge considering the size of the market. But to secure the achievement of this target, last December, we launched the spin-off of this business unit, and we have created TR Power. The new logo is up there in the slide. With more resources, with the sole focus in constructing combined cycles moved by gas turbines, with fully separated financial accounts, with an identity distinct from TR that allows clients to better identify TR power management team, we firmly believe the achievement of our target is closer. And eventually, the fourth driver is to consolidate our presence in the most promising markets. You have some numbers in the slide. They have been provided by McKinsey in its global energy perspective. They may be slightly obsolete because they come from 2024, but it is an undisputed fact that very relevant portion of the global investment will take place in North America, mainly the U.S., and in the Middle East. Regarding the Middle East, PR has strengthened the last two years a position that was already important in itself. We are developing local engineering services. We acquire equipment that is exported all around the world. We construct workshops to build robotic solutions and we use it just to construct modules used in other geographies. On top of that, we are executing massive projects in terms of size and the most advanced projects in the world of the energy transition. So, all those are very good reasons to be optimistic in the Middle East. A vast pipeline amounting 35 billion euros is ahead of us the next 18 months. And for North America, 2025 has been a year of consolidation. The strategic framework agreements with the different energy players are already leading to significant results with more than 17 million euros in services awards in 2025. Furthermore, these engineering services will allow us to access to EPCs where the pipeline of opportunities in the next 18 months stands at more than 24 billion euro. Without any doubt, the recent alliance time with SACRI will enable us to grow faster and solidly. And obviously, the volume of investment in power generation driven by the artificial intelligence will provide us a number of good opportunities this year. So, these are the four main drivers. Now, let me elaborate about the financial figures of the year, although Juan has already given a glance of them. We closed this last quarter of the year with sales of 1.9 billion euros. This represents a 52% increase compared to the fourth quarter of 2024. This from sales performance reflects a healthy delivery of our backlog, the acceleration plans currently being implemented across our Middle East projects and the continued growth of the power business. For the last quarter, we reached 86.6 million euros. This represents a 74% increase versus the fourth quarter of 2024. David Martin reached 4.6%, making the 13th consecutive quarter of margin expansion. David Martin obviously is being driven both by the healthy backlog I mentioned before and expansion of our services business line. And finally, let's now take a quick look at two key figures of our balance sheet. The net cash position at the end of 2025 amounted to $832 million, reflecting the impact of the early repayment to CEPI. Without this repayment, the year-end net cash position would have totaled 507 million euros compared to 427 we had the year before. Regarding equity levels, we ended 2025 with 564 million euros, a very, very robust figure. This is why, and after repaying SEPI loans, TR will resume its remuneration policy, committing to a 30% dividend pay out against fiscal year 2026 results. And the final decision about a potential interim dividend will be made after summer. And now, let me give back the floor to Juan for his final remarks.