Vinci Sa Act

Welcome to the Vinci conference call. I will now hand over to Mr. Christian Laberry, CFO of Vinci. Sir, please go ahead.

Yes, good afternoon or good evening, and thank you for attending this conference call. As usual, I am today with Maria-Emilia Volk, our controller, and the investment relations team, Grégoire Thibault and Alexandra Bournazel, and I will be brief, as usual, to have more time for the Q&A. So what are the key takeaways of the beginning of the year 2021 for Vinci? We can start maybe with a quick organizational reminder. As announced last February, Vinci Construction and Eurovia have been placed under the leadership of Pierre Angelras, which used to be CEO of Eurovia and member of the executive committee of the group. And therefore, Vinci Construction and Eurovia will, excuse me, Vinci will from now on report on this group of business under the name of Vinci Construction, which will include as a result Eurovia. Q1 revenue, as you saw it in the press release, came to 10.2 billion euro, up 5% year on year, and also 5% versus Q1 2019. France, which accounts for 57% of the total, was up 11% year-on-year. Bear in mind that in Q1 2020, business levels at Vinci Énergie, Vinci Construction and Concession in France have fallen sharply following the start of the first lockdown which took place as of March 17th. International accounting for 43% of the total was down 2.3%. minus 1.5% like-unlike, eliminating the currency variations. Unlike in France, business levels abroad generally held up well despite the pandemic last year at the same period, which explains why the variation between 2021 and 2020 is not as favorable as for France. Changes in scope were mainly related to the integration of Vinci Energy in most recent acquisitions, which increased revenue by 1.3%. And exchange rate movements had a negative impact, as I mentioned it, of 2.2%, since most currencies, especially the dollar US, fell against the euro. A very positive point is the order intake. The order intake was dynamic, plus 8% on rolling 12-month basis, of which plus 16% abroad and minus 2% in France. And if we compare with the first quarter of 2020, the order intake was up in the first quarter of 2021, 19%. That growth reflects several large contracts wins at Vinci Construction in particular, including a contract for the Femern Tunnel that will connect in the future Germany and Denmark, which represents an amount of around 1 billion euros. So as a result of that, the order book hit a new all-time high of 45.8 billion euros, up 21% year-on-year. which represents almost 15 months of activity of Vinci Energy plus Vinci Construction, the new Vinci Construction, which provide us with a good visibility and serenity for the future. International business account for 61% of the order book versus 57% at the end of March 2020. In terms of financial position, Vinci continues to maintain its liquidity at a very high level, more than 18 billion, 18.4 exactly, at the end of March 2021, which comprises managed net cash of 9.8 billion euros, 600 million of commercial paper, and also an unused confirmed syndicated bank facility of 8 billion, which is due to mature in November 2025 for almost all of this amount. So as a result, Vinci is well prepared to continue dealing with the unexpected and also continue its development. So let's now have a look, a closer look at the main divisions. Vinci Concession, Q1 sales of 1.3 billion down 22% versus Q1 2020 and down 20% versus Q1 2019. So, Vinci Autoroute first. Vinci Autoroute, which is rather good news, stability of the revenue at 1.1 billion euros. Despite travel restrictions in France and in the rest of Europe, traffic on our motorways saw only a limited decline of 2.8% compared to Q1 2020. Light vehicle traffic fell by 4.5%, while heavy vehicle traffic rose 4.8%. thanks to a firm economic activity and growth in the e-commerce. Compared to Q1 2019, traffic levels were still down 11%. Heavy vehicle traffic up 1.7% was robust, unlike light vehicle traffic down 13.8% versus Q1 2019. Now, Vassi Airport, Vinci Airport, a revenue of only 150 million, down 70%. Like the world's air transport sector as a whole, revenue of Vinci Airport continued to suffer badly from the COVID-19 pandemic and the resulting travel restrictions, continuing the trend seen in late 2020. You have already seen the traffic figures published last week. Overall, passenger numbers in Q1 2021 were down 78% versus Q1 2020 and down 82% versus Q1 2019. Let's talk now about the energy business. Vinci Energy, with sales of 3.5 billion, started the 2021 year well with revenue rising 7%. with Q1 2020 6% like for like and 13% compared to Q1 2019. That upturn was driven by France, where revenue was up 14% in Q1 2021 versus Q1 2020, which had been hit by the start of the first lockdown last year. Outside France, where business levels remained firm last year despite the pandemic, Revenue was up only 2% on an actual basis and stable like for like year on year. This performance is one more time a good illustration of Vincit Energy's resilience and diversity in terms of geographical exposure, business segments, and expertise. Acquisition also contributed by around $60 million to the first quarter revenue increase. Order intake of Vinci Energy was more or less stable compared to Q1 2020, even though Vinci Energies won several major contracts in early 2020. Now let's talk about the new Vinci Construction, which includes Rovia. So Vinci Construction with sales of 5.3 billion, The first quarter of this year continued the positive inflection we saw in the second half of last year since the revenue rose 10% versus Q1 last year and 11% like for like and 6% versus Q1 2019. In France, where business levels were badly affected last year by the near shutdown of work sites, for almost two months starting in mid-March 2020. Growth was firm. Revenue were up 12% in Q1 2021, year on year, with a sharp increase in revenue from public works and civil engineering, supported in particular by the Grand Paris Express projects, and also from road, rail, and ground works, all that for France. Business levels in the building segment were supported by several major developments in the Paris area. So now, outside of France, the growth of the revenue of Vinci Construction in the first quarter was 8%, driven by the major project division, Vinci Construction Major Project, with the ramp-up of several large projects, large contracts, which were won recently, and particularly the HS2 in the UK. which we entered into the order book, if I remember well, in Q2 last year, while revenue was stable in road and rail works despite the negative currency effect. Vinci Construction order intake rose 34% year-on-year in Q1 2021. And now last but not least, Vinci Immobilier. are the property development activities. So the revenue of RC Immobilier rose 34.5% to $320 million in Q1 2021 after the integration of Urbat Promotion, which is a small developer in the southeast of France, which we acquired 100% in January this year. Like for like, the revenue of Vinci Immobilier in the first quarter rose 24.2% versus Q1 last year, when you remember probably business levels were hit by worksite shutdowns from mid-March onwards, and also by a lower number of projects entering into the construction phase because of the pandemic. The number of homes reserved in France by Vinci Immobilier rose 46% to 1,525 units for a value which is up 64% because the average value per unit has increased also. In conclusion, with these good figures, overall, we maintain our 2021 outlook, which we already... explained and disclosed in the previous communications. Advancy Construction and Advancy Energy, the group is aiming, bearing exceptional events obviously, is aiming to increase revenue very close to the 2019 level and also to improve operating margins compared with 2020. Operating margins for the two divisions, Advancy Construction and Advancy Energy, should return to levels similar to those seen in 2019, but probably slightly better, slightly higher in the case, particularly of construction activities. In concession, visibility still remains very limited and business levels continue to depend on restrictions arising from the COVID-19 situation in France and abroad. As a result, it is not possible at this stage to offer reliable forecasts regarding neither Vinci autoroute traffic levels nor Vinci airport passenger numbers for the next few quarters. But for Vinci autoroute, traffic levels can be expected to return to normal relatively quickly, as this was seen in summer last year, as soon as travel restrictions are lifted in France. And maybe the good news will be the next announcement by the government for a new opening of travel within the country in May. Given these uncertainties and the weight of the concession business for the group's overall performance, Vinci obviously cannot provide, at this stage, reliable earnings forecasts for 2021. In any event, earnings will not recover to 2019 levels in 2021. But although it remains unclear how the pandemic will unfold, Vinci has strengths that will enable it to get back onto a trajectory of consistent growth once the COVID-19 crisis has been overcome. Thank you for your attention, and we all are now ready to take your questions.

Thank you, ladies and gentlemen. This concludes the presentation. Now we open the Q&A session. If you wish to ask a question, please press 01 on your telephone keypad. We have a first question from Shippen Lynch from Dutch Bank.

Madame, please go ahead. Hi, good evening. Thank you very much for taking my questions, and congratulations on a Great set of results. Maybe three from me, if possible. The first, could you give us a bit of an update on how public sector contracts that in France are progressing in terms of the order book? Obviously, we had the municipal elections last year and there's always some dip in activity. But are we kind of past that now? And are kind of confidence levels from from the public sector improving in terms of spending? My second question is just on Lisbon and the Montejo Airport project there. I know that there was some court rulings in the last month or so against the project. Is there anything you could update in terms of that situation? And then just finally, maybe a bit of a broad question, but how are you thinking about the benefits for, I guess, Eurovia and fancy construction from the possible U.S. infrastructure spending plan? I know you made an acquisition there a couple of years ago with Lane Construction. Just anything you could give on that would be super. Thank you.

Okay. So the first question relates to the order intake for the public sector in France in contracting. Okay. I would say, very simply, so far so good. maybe you remember that we were a little bit worried at the end of last year about the risk of having sharp deterioration of the situation at the beginning of this year. So far, so good. It hasn't happened. So, overall, both for Rovia, we are talking of relatively small orders in terms of size, average size, and also I'm thinking of Vinci Construction France, there the average size is a bit higher, but for those two main activities which depend from the public ordering, we are more or less stable, I would say. So nothing too bad has happened so far, so maybe we were a little bit too pessimistic when we communicated on this matter last year. Now I don't know what will be the evolution in the coming months, but so far so good. For Montijo in Portugal, considering the situation of the traffic at present, clearly Montijo is no longer a short-term priority neither for Vinci Airport nor for the Portuguese authorities. It will probably become a priority in the future when the traffic recovers, but for the time being, we are still, I would say, in a sort of standby situation, also because some local governments, municipalities around the the site of Montijo, have clearly stated that they were not in favor of this project. So there were some political debates in Portugal between the central government and some local governments, which means that the project could take more time than expected to go ahead. But I think at the very end, it will go ahead. And honestly, if it takes... few more months or years. It's not really a main issue considering the level of traffic at this moment in Portugal. But it will have to be done, but it will be done on time, I think, and these difficulties, these punctual difficulties, political difficulties, I'm sure will be overcome in the future. Now, your last question is about the Biden campaign. announcement in the U.S. I think it's very good news, obviously, but it would be even better news if the announcement transformed into facts and acts. But on the other side, we are at present are not a very big player in the state, as you know, since we make around 2 billion euro or dollars of revenue annually, mainly in the Arovia, so the road work road construction activities and also a little bit in the energy work and engineering and work. So we should benefit at least in the areas where in the states where we are present which are essentially in the on the east coast of the country should this plan transform into actual investments by the authorities. So it's a good news but In the past, other presidents have made also a very nice announcement about the necessity for the U.S. to invest in their infrastructure, and we have not seen much. Also because there were some conflicts between the federal and the state authorities. So there as well, good news, but wait and see. And in any case, we are not a very big player, but we might... increase our presence in the U.S., also because we have won in the recent past several projects, especially one which is quite big, around $1 billion, to build an infrastructure in Virginia. It's a tunnel and a bridge. So we are more and more active in the U.S., but we do that at our own pace, so progressively, because it's a big market. where you need to understand the rules of the game, have a nice partner locally, et cetera. So it takes a bit of time, but we are now more present than when we were a few years ago, and we might grow even more in the future.

Okay, super.

Okay?

Thank you. Thank you very much.

Thank you. Next question from Jean-Christophe Lefebvre-Moulin from CIC. Sir, please go ahead.

Bonjour à toutes et à tous. Good evening. I have three questions, if you allow me. First, a follow-up question on Anna. I think, Anna, you own 100% of this airport, so maybe could you confirm us that Anna had a positive EBITDA last year? Second issue on Vinci Autoroute, I was impressed by your performance. Only 2.8% decline in traffic, so much better than SANEF. Why is this different? Do we have maybe an explanation of this good performance regarding versus your peers? And also this performance, this resilience of traffic is mainly driven by ISEF. There is, let's say, 300 basements a base point on the traffic decline between ISF and Coffee Route. Do we have also an explanation? And last question on Eurovia Legacy. Maybe could we have the sales valuation over the first quarter? Many thanks. Merci Christian.

Okay, Jean-Christophe, as usual, you are asking very detailed and precise questions. I am not sure I can provide all the detailed answers, but let's try. So ANAR is not an airport. It's a group of airports. We operate, as I remind you, all the airports of the country, mainland and the islands. Obviously, Lisbon is the... by far the biggest platform, but we also operate Porto, Faro, plus all the airports of Viasor and Madeira, and also Beja, which is a small mainland airport. And we own 100%, and we are very proud and satisfied of owning 100% of this very nice company, which we acquired in 2013. It was our first major... development in the airport business, and we won an open tender organized by the Portuguese government. I confirm that in 2020, even if it was not very significant, I confirm that the EBITDA of ANA was positive, but I suppose the accounts of ANA are public, if I remember correctly. So you should find all the details in the releases of ANA, which are made locally. As for the motorways, I was expecting your question, because APRR released its figures a few days before. What about Abertis? I don't remember. Probably the difference this time is in our favor. It was not always the case. You could have asked me the question a few years ago, why are we worse than APRR? This time we are better, probably because... It was a bit more complicated this year to ski in the Alps. And you know that in the first quarter, usually APRR benefits from the travel to ski in the Alps. This time, probably due to the shutdown, we benefited from the fact that many people living in the Paris area drove to the Brittany or to the Southwest, like my family, for instance, which is still in Biarritz at this moment, and I will join them next Saturday. But I am the only one in this case, so it's probably part of the explanation. What was the last question?

It is written in the press release. Actually, we said that the activity in roadworks, railway works, and groundworks in France was up 11%. And abroad, it was flat, despite negative currency effects.

OK. Many thanks. Merci.

The worries we had last year were not about the projected level of revenue starting the year, it was more about the evolution of the order intake. So not only the revenue, because we knew last year that we had a very high order book, and since the average duration of the project at Eurovia is relatively short. So we are not that surprised by the fact that the level of activity in France is good in this third quarter. The good surprise, I can say, is the fact that the order intake is better than expected. Thank you. So far, so good, as I said before. Yeah.

Thank you. Next question from Elodie Wall from JP Morgan. Madame, please go ahead.

Oui, bonsoir. Hi, Christian. Thanks for taking my question. And I start actually bouncing back with just your previous comments on the good news on ordering tax momentum generally, and the fact that actually revenues in construction and energy are up already, meaning fully versus 2019 level. So why keeping such a conservative guidance? Because your guidance actually implies trends to come down for the remaining of the year, versus 2019 level, but you had such a good start. And on top, the order book, the order intake is so strong. Can't we not expect actually an increase versus 2019 level? Isn't it more realistic? And on the order book, do you have any orders that are not yet in the order book that you can comment on? And then just one question on airports, if I may, a general question. on the relations with the airlines. Now we've been in this crisis for about a year, and of course the traffic, but are you feeling some pressure from airlines at this point already or not with regard to tariff going forward? How is the relationship? Thanks.

About the presence in our forecast, that's not really new. We've always been present, and I think we were right to be present last year in particular. we are still in a very uncertain world. Many things can happen from now on until the end of the year. And remember that last year, the second half was really well sustained. So yes, maybe we will be better than what we said, but there is no certainty whatsoever. The first quarter is also a relatively small quarter compared to the other ones, especially the the first quarter, which is very important in most of our businesses. So at this stage of the year, it's reasonable to be prudent. But we don't have any specific fact which make us that prudent. It's because we, by nature, we are prudent, and we are only in April. And there are still eight months to come. Pre-backlog, what can I say about the pre-backlog?

Or maybe Gregoire will answer. Yes, regarding the pre-backlog, We could list a number of projects which have been won but not yet in the backlog. The two most important that we announced on already, that's the PPP in Kenya. It's for almost 1 billion euros of works. And the motorway PPP in Czech Republic. It's for more than 400 million euros of work. Of course, we could list other projects but which are not public, let's say. So have in mind that the pre-backlog remains quite robust with the two main contracts being Kenya and Czech Republic, which will be included in the backlog once this project will be closed, once there will be the financial closing in the coming weeks or months.

As for the airlines, we don't generally provide details about commercial relationships with our clients. What can we say? We have different types of airlines with whom we work. First, there are the ones which are state-owned or state-controlled, like TAP in Portugal, like Air Serbia, like Air France, et cetera, Japan Airlines. Well, they are not in a very good shape like most airlines, but so far they have been supported by their governments, so there is no major problem. anxiety about the evolution of their financial situation in the next month. Obviously, it will depend on the pace at which the traffic will recover. Then you have other customers like the low-cost EasyJet, which is our first customer, or Ryanair, or Wizz Air. These companies don't receive much support from the government, but they are well-run. and financially not in the worst situation compared to many other airlines. And there are a few airlines which are in difficulties, especially the ones which are in a Chapter 11 situation. There are a few, like LATAM in Latin America or Norwegian. So we are obviously looking very carefully at their financial situation and the evolution of their financial situation. And there's also TUI. But TUI, it's a major trip organizer, a German organizer, but it's also an airline, which has received a strong support. Despite the fact that it's private, it has received a very strong support from the German government. So still in a reasonably good financial situation. But obviously, we follow up very carefully week after week, month after month, the way these companies, these airlines are facing the difficult market situation which we are all facing.

Okay, thanks. So in general, they're not yet, or they're not putting specific pressure on tariffs, you would say?

No, I think their problem is not really the cost per passenger. It's really having more passengers, more customers.

Yeah.

We have all the same concern, how to have more customers, which depends completely about the restrictions which are implemented all over the world and in Europe in particular.

Yes, very clear. Okay, thanks very much.

Thank you. Some of our customers, in particular the British airlines, have already announced that they are receiving – more reservation for the summer from their own customers following the announcement made by Boris Johnson about the reopening of the country. But this needs to be confirmed, obviously, in the coming weeks and months.

Great. Thanks.

Thank you. Next question from Nabil Ahmed from Barclays. Sir, please go ahead.

Yes, good evening. Congratulations for the very strong numbers, both the revenues and the other intakes. I had actually three small questions, if I may, two about motorways and one about contracting in general. First one on motorways, could you elaborate a bit, if you can, on what's going on with trucks? I mean, in the past, we were used to see much more direct and quick correlation between GDP and the truck traffic. It looks like this time it's defying a little bit gravity. I think you alluded to the development of e-commerce, but is there anything specific you want to share about the trend in trucks and whether you think that could be sustainable? The second question, I was wondering if you could update on the talks with the government's over a potential plan, investment plan in other ways. I understand it's probably not the priority of the government right now, but should we assume, given the upcoming elections, that it's more or less dead until May next year, or is there still a chance that something could happen? And lastly, I mean, this is more general questions, but given that you are both in property development and construction, I wanted to get your view on that. I mean, we're starting to see and possibly this is one of the consequences of the developing working-from-home landlords that are converting offices into housing units. It's clear in Paris and in the big cities. Could you elaborate on what you think the consequences would be for Vinci, Vinci Immobilier and Vinci Construction? Thank you.

About trucks, I have not much to add, apart from the fact that since people are more and more at home, and they are getting bored staying at home, they order many things from Amazon or from other people, and when I see my family, for instance, almost every week my wife orders three different things from Amazon and one year ago she ordered nothing. So I suppose if all the French people do that, at the very end it creates a natural increase of truck traffic. It's probably a large part of the expansion, it's probably not the only one, but I suppose it's really a change in the way the consumers Since they cannot go to the shops because it's forbidden unless it's essential things to buy, they need to spend their money. The money they don't spare, they spend it on the e-commerce. No, I'm just joking. I think it's really the case. Maybe there are other factors which I don't know. You want to add something, Édouard?

There is a kind of resilient activity economy, let's say, and don't forget that the frontier in Europe have never been closed for the trucks, neither in 2020, neither in 2021. So that's maybe another explanation which explains the good reason yet.

Even with the UK, which is completely closed for individuals, but which continues to be open for truck drivers. If it's sustainable, that's... I think the fact that people spend more money on their e-commerce and also on Netflix and this type of thing will continue for sure. Okay, then talks with the government, not with the central government, because as you said, it's clearly not the priority of the government. Talks with local governments, yes, in some cases. We try to keep, whatever the circumstances, a close dialogue with our local partners. It's very important. You cannot just discuss all the time with Paris. You have to to keep a very close relationship with the mayors, with the deputy, locally, et cetera, et cetera. So we do that, and it pays off. Maybe one day it will pay off, but not now, but it doesn't matter. It's a long-term investment. Office to homes, actually, we're exactly doing the opposite, because as you probably know, We are one of the selected developers to build the future Olympic game village for Paris 2024 in Saint-Denis, north of Paris. And the order from the authority is to build a village, so it's units, housing units for the athletes, which will be transformed after the Olympics into offices for maybe administration or whatever. So yes, physically it will be possible to go from let's say residential to non-residential or I suppose the other way around, which means some technical adaptation as you can imagine. And probably some cost overruns, because it will cost more. If you have to change the final use from office to house or from house to office, you will have to take that into account in the budget. So it will have a cost. But yes, more and more, the developers will have to be imaginative about the final use of their products, I suppose. And there are also some projects, I think, in Paris, in the center of Paris, for transforming all office buildings into residential units. So all that costs money. So the politicians sometimes dream about those concepts because at the very end it costs more. So the final user will have to pay for that. which is a problem because on top of that, the cost of the land in the big cities is very high, especially in Paris. But yes, we are working on those concepts because it will be more and more developed in the future.

Okay, that's clear. Thanks.

Thank you. Next question from Gregor Kuglish from UBS. Sir, please go ahead.

Hi, good evening. Thank you for taking my questions. I've got a few, please. So the first one is on cash and the sort of financial position. I think if you look at the numbers, you're up similar, you're sort of sequentially right from end of the year to Q1. So I want to see whether that tells us anything about working capital, because obviously it was very strong inflow-wise last year, and it doesn't look like it's unwinding. I just want to confirm that that's the case. That's the first question. The second question is on your sort of concession bid pipeline. I mean, you won, I think, a smallish concession in Brazil the other day. Perhaps you can comment on that and whether there's anything else that's in the works that you're looking at right now, be it in the U.S. or elsewhere. And then the third question is maybe a little bit early, but I'm going to ask it anyways, is have you looked and analyzed the impact or I suppose the exposure, whichever way you want to call it, to the EU taxonomy rules or the sort of legislation that was published a few days ago, whether you could comment and to what extent you've analyzed what revenues are eligible under the taxonomy rules. That would be helpful. Thank you.

About the cash, we had a consumption of cash, of net cash, in the first quarter, which is normal. We had one as well last year at the same time of the year, several hundred million. It's a working capital evolution traditionally at this time of the year because we have less collections than costs, which are most fixed. From a gross cash perspective, we have also reduced it because it costs money. You know that when you are cash rich, it costs you between 40 and 50 negative basis points. So we decided, for instance, not to renew part of the commercial paper we had issued last year for safety reasons. Last year, we were a little bit in the in the dark, so we really didn't know where we were going. So we decided to increase as much as possible the cash available. So since it costs money, we decided to reduce it a little bit. For the rest, no major change for the moment on the net debt situation, except that we have not made huge investments so far. but you know that we are supposed to pay a little bit more than 4 billion maybe at the end of this year, so it's logical that we save a little bit of money in the meantime. In terms of a concession project in the pipe, apart from Manaus, we have submitted a bid on Toulouse-Castres, It's a small greenfield motorway project in France, but we are not the only one. There are, I think, two competitors, so we'll see who will be selected by the government. We have also submitted offers for two very small airports in France. For one, it's public. We have been selected, ANSI, but there are some opponents. So the deal for the moment is not confirmed. And we also have submitted a bid for a small airport outside of France, but I cannot give you more details at this stage. So nothing very big, really. Nothing very big. As for the taxonomy, honestly, it's a bit early to make a comment on it. We are obviously paying a lot of attention to these new concepts. for this reason and from a pure financial standpoint I think it will be necessary for companies like ours to be able to provide all the necessary information about not only our direct impact on the decarbonization but also give a detailed analysis of our activities and in the different sectors especially for energy but not only what part of our revenue is directly linked to sectors of business sectors which are which fits well with the taxonomy constraint but i will not dare giving any percentage i think it's there are some information in our annual report but It's a bit early to be more specific about this matter. Did I forget a question? No? Okay.

No, that was it. Thank you very much.

Thank you. Next question from Luis Prieto from Kepler Chevrolet. So please go ahead.

Thanks a lot for taking my questions. I had two brief questions. The first one is you recently provided us with the commuter component in your road traffic And along the same lines, I was wondering if you could give us an idea on how much of light traffic currently relates to leisure, visiting friends and family, whatever you want to call it, versus business and other drivers. And the second question, should we expect in 2021-22 Vansi taking any steps towards gaining future exposure to the managed lane segment in the U.S. infrastructure sector? Thank you.

Your first question relates to airport or more generally to motor... No, it's toll roads.

It's motorways. Trying to get a similar idea.

To have an idea of what the leisure... We can give you some figures, but we are not allowed due to legal regulation in France to make... a close control about why our customers drive on our motorways. It's forbidden. So we can only make inquiries. But maybe Grégoire wants to provide some information?

Yes, what we could call commuters would account for around 5% of the total light vehicle traffic. So it's finally pretty small.

But you cannot give any information about will the people travel for personal reasons?

No, no, contrary to the approach.

I'm not going to put a policeman at the toll gate and ask you when you drive your car, are you going to see your wife or doing business or both, maybe sometime. No, it's not possible. Now, the last question about what was it? Management. The answer, obviously, yes, we would like to. We have hired Madame Marcos. She used to be the CEO of the subsidiary of Ferrovial in North America. She had been appointed CEO of the Toronto Motorway, but she finally preferred to join Vinci. And we have now, as I said, a more significant presence, at least in some states of the East Coast, through Ferrovial. So, yes, we would be more than pleased to try to win a project, not too big, because we know by experience that big projects, especially in the States, can be risky. And some colleagues, including Ferrovial, which has done a very good job, apart from that, in the U.S., have also experienced some difficulties because of the fact that when you are in charge of a management project or any concession project, you need to secure a fixed-priced contract with the contractor. And it's not always possible because the contractor don't want to commit themselves on a fixed price for billions of dollars, especially in the States. So in such case, the concessionaire company will have to take the risk. If not, it will be unable to finance the project on a non-recalled basis with some money providers. So for all these reasons, you have to be careful. So yes, we are interested, but we should find, and maybe it will be possible in the future thanks to the Biden plan, to select some project of a reasonable size. When I say a reasonable size, it's between, let's say, a few hundred million and maybe up to one billion or a bit more than one billion, but not four, five, six billion dollars. It would be too big for us considering our lack of experience of the US market. So we will do that at our pace.

Yeah. I assume it's too early to provide any visibility on targeted states or anything similar, right?

No, we follow up. I never comment on prospects, but we are following up a few projects, which are not necessarily actual managed land. It can be punctual projects. infrastructure, bridges or tunnels, tall tunnels or tall bridges. It can be that also, not necessarily the managed lane.

Okay, understood. Thank you very much.

Thank you. Next question from Laurent Rinache from Exxon AM. Sir, please go ahead.

Thank you. Very good result. Congratulations. I'd like to ask a question regarding Vinci Energy to try to understand what is the underlying real organic growth. What could be your guesstimate for the comps when France went into lockdown? The first lockdown was very severe. So what, in your view, is if we try to... to account for the impact of the lockdown in 2020, in the first quarter of 2020, what would be your guesstimate of the real organic growth of the Vinci Energy Division?

I don't have the information. I'm sorry. First quarter, the impact of the lockdown was quite limited because the lockdown started actually the 17th of March. So 14 days out of 90 days for the quarter. And during those 14 days last year, it's a guess, but Vansinergie in France probably was at something around 30, 35% of its normal level of activity. where Eurovia and Vinci Construction France during those 14 days were nearly at zero. That's all I can say.

Okay. Thank you so much. And bravo again.

Thank you. Thank you. Next question from José Arruyes from Santander. So please go ahead.

Good evening, gentlemen. I just had a couple of questions. First is on the contracting order backlog, which is at a pleasant all-time high. What assurance can you give us that the margins can improve, especially on the back of the latest orders, the 1 billion large order, bridge order in Germany? And that, I mean, basically that these orders are of high quality and that the margins can continue to improve as the guidance suggests? And my second question is related to the ACS IS transaction you presented on a few days ago. I wanted to double-check the indication you gave back then that this deal would generate mid to high single-digit EPS accretion from year one. I wanted to check if there is no PPA amortization charges that we need to reflect on this deal, that this is an all-in EPS accretion. Thank you.

Honestly, I'm talking under the control of Maria Emilia, which will be in charge of the PPA, but not now. When we will be able to consolidate ACS, so maybe hopefully by the end of this year. So I have no idea whatsoever at this stage for being more specific about the profit-enhancing impact of ACS, except that so far they have been able to generate around and even a little bit more than 6% EBIT margin. Their financial situation was structurally positive. They were cash positive, but they had some financial expenses because they had issued a bond, a green bond. And this led to a net profit order of magnitude of, let's say, four or five percent on revenue something like that this was the past and hopefully it will be at least the same for the future but i cannot tell you more because we are not the owner of ses is we have just signed an agreement with mr perez and now we have to go through the entire process of antitrust clearance of investment control clearance etc etc it's a very cumbersome and I suppose, quite long process because there are a certain number of countries we have to go through those processes. And hopefully all that will be completed by the end of the year. And by then we will have gone into more details for preparing the PPA. But I cannot tell you more at this stage. Now for the order book, I never commit on the margin in the order book because, you know, in contracting... In construction, in particular, you have always risk in the execution of the projects. The only thing I can tell you is that the people in charge of those activities, both at Vinci Construction in the different divisions and Eurovia and obviously Vinci Energy, all these people are really all focused on profit. They are not crazy people. They have to go through... risk committee at the Vinci level with Xavier Villard heading it for the main project, for the biggest ones, and the FEMAN is a good example. So we are not prepared to lose money, and I don't think many people are prepared to lose money. So when those projects are presented by the people in charge, we make sure that at least on the paper, with the hypotheses which are factored in, it's reasonable to put the price we propose to the final customer. So in the case of the FEMERN, I don't have the figure, but the FEMERN is a very technical project. We are teaming up with DEME. DEME is a dredging company belonging to CFA, a Belgian company listed in Brussels. which we know very well because we are also a minority shareholder of CFA, and I am the board member of CFA. So it's a very strong team, Deme plus Vinci. I think we have also a local partner, a Danish partner. So we had a very strong joint venture, and technically it's not an easy work because we have to build a tunnel which will be – precast and located in the bottom of the sea. But it's a technique that GTM, which used to be a component of the Vinci Group a long time ago, is an expert in. GTM, for instance, built a similar tunnel in the city of Amsterdam, which you can imagine was not so easy, because building this type of tunnel in an urban agglomeration is difficult. And they did it, I think, in other places. So they have the experience and the guys capable of taking the responsibility to beat such things. But there are not very many companies capable of doing that. So the consequences of all I have said is that I suppose the price they have proposed not only covers the risk incurred, but also will permit to show a reasonable margin. And we have a good customer. The customer is the Danish government and the German government. And it's a fair customer.

Thank you. We have a next question from Eric Lemay from Brian Garnier. So please go ahead.

Yes. Thank you for taking my question. I've got three, if I may. The first one, regarding Vinci construction, you mentioned In the press release, the good dynamic from the Grand Paris and the building activity in the Paris region. But what about the activity in the rest of France for this deconstruction? Could you make maybe some comments there? It was my first question. I got a second question on digitalization. Do you think the pandemic, do you think the crisis has accelerated the development of digital solutions in construction or not really? And the last question on Vinci Energy, you mentioned this acquisition for Vinci Energy. Should we expect further bottoms for Vinci Energy going forward despite this ACS deal? Thank you. Thank you. Are you there?

Hello? Hello? I'm on mute. Sorry. I repeat. So about the energy, the answer is yes. There is no reason why we should prevent that energy to continue to make alternate position because it does that very well. And it is really fully part of their business model in order to complete their expertise and geographical presence, including in France. But there is nothing big as present in the pipe, as far as I know, for this year in terms of acquisition for Vinci Energy. Last year, at the very end of the year, they closed the acquisition of the company in Quebec, in Montreal. It was not easy because we were... They couldn't travel, so they did all that at the distance. Finally, they find an agreement. So they have to digest this acquisition before contemplating further ones of a certain magnitude. It's not incompatible with the acquisition of ACSIS, providing, obviously, we are not talking of acquisition in a country where ACSIS is already very big, like Spain, for instance. or even Portugal, where probably we will have some discussion with the antitrust authorities. Then digitalization. No, I think the digitalization had a very significant impact in the head office ways of working, for obvious reasons, because we had to go home suddenly on the 17th of March. Most of the people were at home. And then, in the course of April last year, operation people went back to the site. And we had to organize the flows of workers very carefully, considering the barriers of protections. But the digitization of the job itself has not been dramatically changed because of the pandemic it's a it's a long-term trend which started before the pandemic and which will continue after uh and what was the last question there was another question anybody has information about that uh well i i know some regions better than others i know for instance that in the west of france the activity is quite sustained at this moment but It doesn't mean it's the same everywhere. I think in Lyon as well. I don't know about the south. The south was quite depressed in the recent years. There are probably differences between the regions, but honestly, I don't have details to provide.

Okay. Thank you. May I ask a question?

Yes, yes, yes.

Yep, yep. Just a last one. I know he... So I've got an answer for that, but do you consider any risk on matters of raw material inflation or any risk of construction site destruction, as it was mentioned by the French Federation of Buildings?

It's obviously a critical issue. Well, the first answer is that the problem is the same for everybody, not just for Vinci. We are quite accustomed to this type of problem, particularly at Eurovia, because Eurovia is probably the most industrial business of Vinci, because of the need to acquire oil products, aggregates, etc., etc., the price of which fluctuates regularly. So this problem is properly addressed in the way the contracts are written. which permits either to push to the customer the changes in price or when it's not possible make sure that in the pricing of the project we have factored in enough provisions in case and this is also the way it works in most activities especially in construction so it's a it's a serious issue and but so far have not been informed of any material negative impact that we would have to face. And there are some big contracts, like, for instance, HS2. In the Anglo-Saxon world, it's quite classical that the prices take into account adjustments for taking care of variation of material costs.

Thank you.

Thank you. There is no more questions for the moment. Ladies and gentlemen, I remind you that if you wish to ask a question, please press 01 on your telephone keypad.

So maybe we can go home now and have a drink. And thank you for attending this meeting, and I hope to see you physically soon when Mr. Macron and Mr. Castex will authorize us. Have a good evening.

Bye-bye.

Bye-bye. See you soon.

Thank you, ladies and gentlemen. This concludes the conference call. Thank you all for your participation. You may now disconnect.