Ferrovial - Q4 2025

Transcript

Silvia Ruiz (Global Head of Investor Relations)

Good afternoon, everybody. This is Silvia Ruiz speaking, I would like to welcome you to Ferrovial's conference call to discuss the financial results for the full year of 2025. I'm joined here today by our Chairman, Rafael del Pino, our CEO, Ignacio Madridejos, and our CFO, Ernesto López Mozo. Just as a reminder, both the results report and the presentation are available on our website since yesterday evening after the U.S. market was closed. At the end of the presentation, there will be a Q&A session run by our CEO and our CFO. As in previous calls, you will have the opportunity to ask questions live. For that, you will need to join the call through the conference call channel and press star five on your phone keypad.

If you prefer, you can send them through the forum included in the webcast, and I will be reading them out loud at the end of the Q&A session. Before starting, please take a moment to look at the safe harbor statement included in the presentation. Please bear in mind that the presentation contains forward-looking statements and expectations that are subject to certain risks and uncertainties, so actual figures may differ. Other than as required by law, the company assumes no obligation to update forward-looking statements. During this call, we will discuss non-IFRS financial measures, which are defined and reconciled to the most comparable IFRS measures in our results report. With all this, I will hand over to Rafael. Rafael, the floor is yours.

Rafael del Pino (Executive Chairman)

Thank you, Silvia, good afternoon, everyone. Ferrovial delivered a robust performance across all business divisions in 2025. In highways, our North American assets continued to deliver outstanding revenue and EBITDA growth. In airports, we continued to make progress at New Terminal One at New York's JFK Airport, where our focus is now on operational readiness. In construction, our lines of business achieved an outstanding performance. On the financial side, we closed the year with a solid cash position, with negative net debt, excluding infra projects, of EUR 1.3 billion. This was supported by record dividends received from our infra assets that reached EUR 968 million. In addition, we collected proceeds of EUR 533 million from the sale of AGS and EUR 539 million from the divestment of a 5% stake in Heathrow Airport.

These cash flows were combined with investments for growth that included the acquisition of an additional 5% stake in 407 ETR for CAD 1.3 billion, as well as $236 million of equity injections in NTO. We returned to shareholders EUR 156 million in cash and repurchased shares totaling EUR 501 million. We also achieved significant milestones in 2025. We were shortlisted for the bidding of the I-285 East Express Lanes in Georgia and the I-24 Southeast Choice Lanes in Tennessee, both of which are expected to be awarded this year. In February 2026, Ferrovial's consortium was shortlisted for the I-77 South Express Lanes projects.

Following our U.S. listing in 2024, Ferrovial joined the Nasdaq-100 Index in December, a key milestone that reflects our growing presence in the North American market and the confidence investors place in our long-term strategy. In the following slide, we review some of the key figures for the year. Revenue reached EUR 9.6 billion, up 8.6% year-over-year on a like-for-like basis, driven mainly by high revenues in highways and construction. Adjusted EBITDA stood at EUR 1.5 billion, representing a 12.2% year-over-year increase on a like-for-like basis, supported by the growing contribution from our portfolio of managed lanes in the U.S. and a very solid year in our construction business. The construction order book reached a new all-time high of EUR 17.4 billion, with almost 50% coming from North America.

Dividends from projects reached a record EUR 968 million, showing a 2.2% increase year-over-year, led by contributions from managed lanes and 407 ETR. As mentioned before, a solid cash position with negative net debt, ex-infra projects, reached EUR 1.3 billion. Finally, total shareholder return in 2025 reached an outstanding 38.6%. I will now hand it over to Ignacio, who will review Ferrovial's performance in 2025 by business division. Ignacio, the floor is yours.

Ignacio Madridejos (CEO)

Thank you, Rafael, and hello, everyone. Let me begin with an update on our strategy. Our key North American infrastructure assets, the 407 ETR and the U.S. managed lanes, continue to perform strongly. The 407 ETR delivered double-digit EBITDA growth, while the managed lanes reported revenue growth significantly above inflation. In NTO, we advanced in the construction of the New Terminal One at JFK and invested EUR 236 million in equity over the year. In terms of growth opportunities in North American highway assets, we increased our stake in 407 ETR to 48.29%. We are confident in the long-term prospects of the Greater Toronto Area and the long-term value creation of the asset. During 2025, we also made significant progress in our US pipeline.

We were shortlisted for I-285 East in Georgia and I-24 in Tennessee, both of which are expected to be awarded this year. Additionally, in February 2026, Ferrovial's consortium was shortlisted for the I-77 South Express Lanes project in North Carolina, with award estimated for 2027. All three are managed lanes projects in fast-growing metro regions. We are facing a record pipeline of infrastructure projects in the U.S., larger than anything we have seen before. As cities continue to expand and congestion intensifies, managed express lanes and toll-based systems have proven to be reliable and highly efficient solutions. Beyond highways, we continue to monitor opportunities across other infrastructure segments, including airports like NTO, with capacity expansion needs, greenfield data centers, and energy infrastructure projects. Recent examples include the development of solar photovoltaic projects in Texas and acquisition of land plots for data center development in Spain and Poland.

We remain selective when pursuing only those opportunities where our capabilities provide a clear competitive advantage, and the risk-return profile aligns with our strategic priorities. Our capital rotation strategy focus on mature assets, continues to provide flexibility to reinvest in the most attractive opportunities. Our divestments in Heathrow and AES in 2025 are good examples of this. This growth strategy will be funded by solid cash flow expected from our current portfolio in the following years, while we continue to maintain our financial discipline with a focus on delivering value creation for our shareholders. Turning to highways, 2025 was another outstanding year for the business division, especially North America. Highways revenue grew 13.7% like-for-like in the year, while adjusted EBITDA was up 12.2%, driven by a strong double-digit growth from our U.S. assets.

In the fourth quarter, the adjusted EBITDA declined by 2.9% compared to previous year, impacted by foreign exchange and higher bidding costs. U.S. highways revenue grew 14.2% in like-for-like terms in 2025 compared to previous year, and adjusted EBITDA increased by 12.4% versus 2024. Dividends from our North American highways total EUR 855 million in 2025, reflecting the strong growth and cash generation of these concessions. The figure is slightly below the EUR 860 million in 2024. Remember that 2024 includes the first dividend from I-77 after five years of operation, which was an extraordinary amount of EUR 205 million. Turning to the 407 ETR, the asset delivered an outstanding performance in 2025. Traffic increased by 6.1% in 2025.

This growth reflects the success of targeted rush-hour driving offers, as well as the increase in mobility from return to office mandates, partially offset by unfavorable winter weather in 2025. Revenue grew 17.8% year-over-year, with toll revenue increasing 17.6%, primarily due to the higher toll rates that came into effect on January first, 2025. Looking at fourth quarter figures, revenue per trip grew by 7.1%, compared to 11.7% for the full year. This last quarter's performance was mainly due to seasonality and a softer contribution from heavy vehicles, which pay higher toll rates. In terms of EBITDA, it grew 14.2%, impacted by the Schedule 22 expense provision. That was CAD 14.9 million in 2025, along with an extraordinary higher provision for lifetime expected credit losses.

Looking at promotions, they work very well in incentivizing more efficient use of the road throughout 2025. These targeted offers continue to provide us valuable insights into customer behavior. We expect our focus on demand segmentation to continue enhancing value for users and maximizing EBITDA growth. Regarding dividends, in 2025, the 407 ETR distributed a total of CAD 1.5 billion. Lastly, on January 1st of this year, the new toll rate and fee scheme was implemented. Moving now to our Dallas-Fort Worth managed lanes. In terms of traffic, the corridor remains strong, while traffic in our managed lanes was impacted by construction works. In terms of operating results, the three projects posted solid growth versus last year, both in terms of revenue and EBITDA, despite the increase in revenue share. Remember that revenue sharing is a consequence of the overperformance of the assets.

At NTE, traffic declined 4.7% compared to 2024, due to the ongoing impact from capacity improvement construction works. These works are expected to be completed by year-end, except for two additional ramps that began construction last year. Despite lower traffic, revenue increased by 8.1% in 2025, and adjusted EBITDA grew by 5.5% year-over-year, including $8.1 million of revenue share in 2025. At LBJ, traffic was flat in 2025, despite the impact of construction works affecting nearby connecting highways. In the fourth quarter, traffic performance was affected by changes in the staging of adjacent projects. Revenue grew 8.6% in the year, while adjusted EBITDA grew 9.2% versus 2024.

At NTE 35W, traffic increased by 2.9% in 2025, reflecting solid demand across the corridor. When looking into the fourth quarter performance, the traffic was down by 0.4%, impacted by bottlenecks at managed lane access/exit points, and the finalization of capacity restriction linked to construction works on competing nearby Road 121. We are working to identify solutions that relieve congestion and address these bottlenecks that I mentioned, although any implementation could take few years. On the financial side, revenue grew a robust 14.7% year-on-year, and adjusted EBITDA rose 10.6% for the year, and included $26.4 million of revenue share. In all, our Dallas-Fort Worth managed lanes revenue per transaction increased well above the soft cap and inflation, supported by a favorable traffic mix.

NTE and 35W also benefited from a higher number of mandatory mode events. The soft cap was updated for 2026, increasing by 2.7%. Revenue per transaction grew year-over-year by 13.4% in NTE, 8.7% in LBJ, and 11.6% in 35W. Following this robust operating performance, all three Dallas-Fort Worth managed lanes delivered higher year-over-year dividend distributions. NTE reached $216 million, LBJ, $123 million, and NTE 35W, $215 million. Moving now to I-66, traffic increased by 7.4% in the year, supported by a strong corridor growth that benefited from greater enforcement of return to the office policies, despite worse weather conditions and the federal government shutdown in the last months of the year.

Revenue per transaction grew by a healthy 13.3% in 2025. Looking at last quarter's performance, let me highlight that the 1.3% increase in revenue per transaction reflects a singular quarter performance, influenced by an unusual traffic mix and lower peak hour volumes, mainly due to adverse weather conditions and the temporary shutdown. We remain confident on the asset and expect future toll rates to grow above inflation based on the value for users linked to how congestion evolves in the area. Adjusted EBITDA rose an exceptional growth of 25.7% in 2025, driven by traffic growth and higher toll rates.

In 2025, I-66 distributed $165 million in dividends at the 100% level, compared to $172 million in 2024, when the asset paid its first dividend distribution after two years of operation. Turning to the I-77 or managed lanes in North Carolina, traffic declined in both fourth quarter and full year, as the fourth quarter of 2024 traffic benefited from an exceptional uplift caused by hurricane-related alternative lane closures, together with adverse weather conditions throughout 2025. I-77 delivered a very strong revenue per transaction growth, up 24.7% year-on-year. The adjusted EBITDA grew by 16.5% in 2025, including $21 million of revenue share in 2025.

I-77 distributed $52 million in dividends at the 100% level, compared to $307 million in 2024, which was the first dividend distribution of the asset after five years of operation. Our North American toll road assets are located in some of the top-performing regions in North America, consistently growing above the national average. Starting with Toronto, as the short-term economic growth may be modest given the geopolitical environment, but the long-term prospects remain solid. The Greater Toronto Area population is expected to expand 22% by 2051, and Toronto is forecast to deliver higher 5-year GDP growth than both Ontario and Canada. Moving now to Dallas-Fort Worth, the region continues to show very strong economic and demographic momentum.

By 2050, Dallas-Fort Worth is projected to surpass Chicago and become the third largest metropolitan area in the U.S., with more than 12 million of population. The region benefits from a very diversified economy, it remains one of the most attractive destinations for both corporate and families relocating within the U.S. Over the next five years, its GDP growth is projected to exceed the U.S. average. In Northern Virginia, the area stands out for having high household incomes. The Washington metro area has a higher proportion of households earnings above $100,000 than the U.S. average. Over the next five years, the median household income is forecast to rise by 3.2% in Washington metro area. Lastly, Charlotte remains one of the fastest-growing metro areas in the southeastern United States.

In 2025, it recorded the highest job growth rate among the top 50 metros, at 2.3% versus a national average of 0.9%. Looking ahead, the region's population is projected to increase by more than 50% by 2050, led by Mecklenburg County, where the I-77 is located. Turning to our business in India, in 2025, IRB reported a decrease in revenues, showing lower construction activity following the completion of several projects, as well as the one-off positive impact from a claim recorded in 2024. IRB Private InvIT continued to deliver solid performance with a year-on-year growth in revenues and EBITDA. At the same time, the Private InvIT advanced in its capital recycling strategy through the sale of three assets to the Public InvIT, enhancing portfolio optimization.

During the year, IRB Infrastructure Trust was awarded two new DOT concessions, reinforcing the company's leadership in India's toll road monetization program. Looking ahead, India remains an attractive market, supported by a strong GDP and a significant funding gap in transport infrastructure. In 2025, India's GDP grew by 7.7% year-over-year, despite ongoing macroeconomic headwinds. Moving on to airports and New Terminal One project at JFK Airport, we continue making a steady progress towards operational readiness. The project keeps progressing, facing a crucial year. In terms of the schedule, the contractor has communicated an updated target completion date for the first phase of construction of fall 2026. The project reached 82% construction progress as of the end of the year. We have secured commitments from 25 airlines, including 16 executed agreements and nine letters of intent.

As a reminder from previous quarters, we achieved an important milestone in July, completing the refinancing of phase A through the issuance of a $1.4 billion long-term bond. Turning to our airport in Turkey, Dalaman, delivered a steady performance despite macroeconomic headwinds and geopolitical challenges that significantly affected international traffic. In 2025, passenger numbers declined by 1.1%, yet revenue grew 3.6%, driven by better non-aerial performance. Adjusted EBITDA increased 2.5%, supported by a strong commercial performance. Ferrovial received EUR 7 million in dividends from Dalaman in 2025. Let's now turn to construction. The division posted an outstanding year, delivering a strong growth and solid profitability across all business units. Revenue reached EUR 7.7 billion, up 7.5% in like-for-like terms compared to 2024.

Adjusted EBITDA was EUR 511 million, up 19.9%, and adjusted EBIT total, EUR 352 million, increasing by 24.2% like-for-like. The division delivered a 4.6% adjusted EBIT margin in 2025, above our long-term strategic target. The business performed well across all divisions. Budimex delivered a standout 9.2% adjusted EBIT margin, with improvements across all segments and benefiting in fourth quarter from one-off change orders and higher contribution from later stage contracts with risk already fully mitigated. Webber reached a 3.2% adjusted EBIT margin. Ferrovial Construction improved to 2.4%, supported by risk reduction on later state projects and improved execution. Profitability in 2025 continued to be impacted by significant design activity in bidding for projects and costs related to the utilization and IT systems.

We finished 2025 with a record high order book of EUR 17.4 billion, up 10.1% like-for-like from December 2024. The composition of the order book remains very healthy. It does not reflect roughly EUR 2.5 billion in contracts that are pre-awards or pending financial close. Almost half of our order book is in our core U.S. and Canada market, which we expect will continue to support future growth. Our operating cash flow reached EUR 597 million in 2025, compared to EUR 291 million in the previous year, driven by fourth quarter working capital seasonality in Poland and Spain, together with prepayments and compensation received in the U.S. and Canada. Lastly, in terms of outlook for the division, we maintain our average long-term target of 3.5% adjusted EBIT margin. Now, Ernesto will continue with main financial information.

Ernesto López Mozo (CFO)

Thanks, Ignacio. I'll cover now the main lines of the P&L statement. As you have seen in the previous slides, adjusted EBITDA has grown on the back of U.S. highways and construction operational performance. The EBITDA figure also includes other businesses like waste treatment in the U.K. In the fourth quarter, an agreement was reached to exit the Isle of Wight waste treatment contract by the end of March 2026. This agreement had no additional impact on the P&L from what had already been recognized in the first nine months. As we have mentioned in past calls, we aim to fully exit the business in due course. Depreciation has increased on the back of higher traffic than expected on I-66, and replacement CapEx being brought forward in the Dallas-Fort Worth Express Lanes.

The disposals and impairments in 2025 relate mainly to the sale of AGS. During 2024, we had the impact of the sale of 19.25% of Heathrow. Financial results, infra projects, a slight increase of expense versus previous year due to increased debt in highways along 2024, and lower cash remunerations on lower average cash balances, partially mitigated by US dollar depreciation. Financial results, ex infra projects, the income is driven by net cash balance, the Heathrow Airport Holdings 5.25% stake ticking fee, and employee share plan hedges. Last year, we had the fair value positive impact of the 5.25% stake in Heathrow Holding that was sold this year, in 2025. Equity accounted affiliates' profit grows on the back of the 407 ETR outstanding performance.

Income tax has a positive impact due to recognition of tax credits in the U.S. and Spain, mainly. Results from discontinued operations reflect earnings from divested services business. Turning to the net cash, net debt position, the ex-infrastructure net debt, we see that dividends from projects amounted to EUR 968 million. On top of the highways dividends already discussed, energy distributed EUR 54 million, corresponding to the return of capital invested in a photovoltaic plant in Texas, and the airports divisions distributed EUR 30 million, of which Heathrow represented 50%. Construction operating cash flow is tax payments ex-dividend, reached EUR 596 million, driven by the fourth quarter working capital in Poland and Spain, and further enhanced by prepayments and compensation received in the U.S. and Canada, as Ignacio just discussed.

Tax payments reached a EUR 100 million, including EUR 47 million of corporate income tax in Budimex. Investments totaled EUR 1,170 million, mainly due to the additional 5.06% stake acquired in the 407 ETR, for a price of roughly EUR 1.3 billion. Also the EUR 236 million of equity invested in NTO. Interest received and other investing activities cash flow amounted to EUR 113 million, mainly related to cash remuneration. Divestments reached EUR 1,158 million, largely driven by the divestment of Heathrow, EUR 539 million, and the divestment of AGS, EUR 533 million.

Cash dividend and treasury share buybacks purchases at EUR 657 million in 2025, includes EUR 156 million from cash dividends and EUR 501 million of share buybacks. Other cash flows from financing activities used in financial activities, you have EUR 437 million, including the repayment of the revolving credit facility, that was EUR 250 million. Also, the reduction of the euro commercial paper, EUR 200 million, and financial leases reduction, EUR 121 million. Also, we include here the dividend to minorities, that is EUR 77 million, and interest payments, EUR 64 million. All this is partially offset by the issuance of a non-dilutive convertible bond that is registered here at EUR 350 million.

We also have the effect of the exchange rates on cash and cash equivalents, a reduction 91 million EUR, mainly from the US dollar depreciation. We don't include here in this net cash position, the mark-to-market FX hedges. As of December 2025, we had a notional from the exchange hedges of $2.847 billion and CAD 538 million. The corresponding mark-to-market of these hedges was 147 million EUR, as I mentioned, not included in the net cash position. Moving to the slide of dividend proposal. This year, we shall propose 1 billion EUR in dividends. We can consider this is a 400 million top-up of what would be a comparable dividend, to past years of EUR 600 million.

Ignacio Madridejos (CEO)

With this, the aggregate dividends for the period 2024 through 2026 will total EUR 2.2 billion, following market standards, where dividends are based on the share price at the time of delivery to shareholders. As usually, we're looking to break it down probably into dividends along the year. Now let me hand it over to Ignacio for the closing remarks.

Cristian Nedelcu (Executive Director)

To conclude, our North American portfolio continues to deliver solid revenue and profitability growth, driven by enhanced customer segmentation and underlying growth in the locations where our assets operate. Looking ahead, we are well positioned for continued growth, supported by a record pipeline of U.S. infrastructure projects and rising interest in P3 opportunities across the country. Finally, our construction order book remains healthy, with anticipated limited exposure to inflation.

Silvia Ruiz (Global Head of Investor Relations)

Thank you very much, all of you, and let's start with the Q&A session. Operator, please go ahead.

Operator (participant)

Ladies and gentlemen, we'll now begin the Q&A session. If you'd like to ask a question, please press star five on your telephone keypad. If you change your mind, please press star five again. Please ensure that your device is unmuted locally before proceeding with your question. Our first question comes from Cristian Nedelcu from UBS. Your line is now open.

Cristian Nedelcu (Executive Director)

Hi, hi. Thank you very much for taking my questions. The first one on the ETR, the Q4 revenue per transaction, up to 6%, you mentioned due to some weakness in heavy vehicles. Can you elaborate on this? Is this spilling over into 2026, this headwind? The second one, you have the new pricing in place for the ETR 407 from January. Could you talk a bit about what you're seeing, the feedback from customers? Are you seeing demand erosion as a consequence of that, or are you expecting other negative mix impacts here?

I'm trying to understand if this 21% growth in price at peak times is representative for the revenue per trip growth in 2026. The last one, if I may, NTE 35W, during your remarks, you mentioned about the volume weakness in Q4, also due to some bottlenecks, and it sounded that you expect this to spill over into 2026. Could you elaborate a bit if my understanding is right, and if you can give more details there? Thank you.

Ignacio Madridejos (CEO)

Thank you for the questions. I will start with the 407 ETR, the revenue per transaction. In the fourth quarter of the year, that was lower than the previous quarter. You have to consider that something that happens, no? Usually the fourth quarter compared to the third, that is some seasonality, no? In this case, probably more even because of weather, no, that affected. Usually what happens is that during the summer, you will have longer trips in the corridor, also more type of users that not have transponders, they have a charge because the video, it's not that we have.

It has been repeated this this quarter, as commented, because of weather, probably more with some effect that not relevant about the heavies, but it's too early to say if it's something that will continue or not. Of course, always is very related to the economic activity of the country, and especially about the region of Canada, and is continued expected to grow this year, according to third parties, but we have to see how it is evolving. What we need to consider always in these things is the effect on of promotions.

As you know, we are very positive of about the promotions that we did last year, and I think that is helping now with with users, with the value that we give to the users, but also it's helping to maximize EBITDA. This is the main KPI that we are following. Promotions are increasing traffic, but they are also reducing the revenue per transaction. It helps us to maximize EBITDA, and this is something that we have to follow, this number. For this year, 2026, we don't give any guidance, but as commented previously, we'll continue with the promotions as we did in 2025. We expect also that is going to contribute to maximize EBITDA also in this year, 2026.

Regarding the NTE 35W, the volumes in the last quarter, yes, I commented about that some bottlenecks, no, is, that we have, that is affecting the whole corridor, no? The whole corridor is growing, what we are seeing is more congestion. This is something that will continue happening. As you know, more congestions will mean that some traffic is moving out of the corridor, but this also will mean that probably we have more mandatory modes, no, in the way that we have had until now, no?

Of course, as I commented, we are looking for solutions, but I think we have some designs and changes that could improve the situation, but, we need, several approvals, and it will take time, no? As commented in the short term, we may see softer traffic compared to the whole traffic growth in the region, but probably because of more of congestion, more mandatory modes?

Elodie Rall (Managing Director)

Thank you.

Operator (participant)

Our next question comes from Luis Prieto from Kepler Cheuvreux. Please go ahead.

Luis Prieto (Equity Research Analyst)

Good afternoon, everyone, and thanks a lot for taking the time to answer our questions. I have three questions, if I may. The first one is, could you please shed a bit of light on the reasons behind the provision for lifetime expected credit loss of the 407 ETR? Should we expect this to happen again? The second one is that, although you have reiterated your long-term EBIT margin outlook in construction in one of your slides, wouldn't Q4 margins suggest that there is upside risk to this figure over, at least over the coming year? The third question is if you could provide us, please, some anecdotal evidence on customer segmentation measures in the U.S. managed lanes, not the 407, which I think is widely understood, but what are you doing specifically on the U.S. managed lane? Thank you.

Ignacio Madridejos (CEO)

Thank you. Thank you, Luis. About this provision for credit loss. Some years ago, we have a change in the processes that we have, and because of that, we have some old accounts that we thought that it was healthy to provision at the end of last quarter. The new collections after this change of process that we are seeing right now are back to what they were before this change of process. It's back to normal, to what it was before. In terms of EBIT, the only guidance that we give is that long-term average EBIT is 3.5% for construction, so sometimes will be above, other times will be below.

As you know, this is a cyclical business. This is the only guidance that we are giving. We mentioned several times that we have a healthy backlog today, no? The only guidance that we are giving is about this 3.5% EBIT margin in the long term. Also regarding the fourth quarter, there were some one-offs that they were exceptional and related to some change orders that we have in certain countries. The last one about the customer segmentation in the U.S., yes, of course, something that we are looking at and we are analyzing.

However, it's too early and more difficult than in the 407 ETR, and it is because we are not doing the collections in the case of the U.S. managed lanes, and it's more difficult to reach customers. Of course, it's something that we are analyzing and seeing if we can create value, also maximizing the EBITDA with promotions in the future, it will take longer.

Luis Prieto (Equity Research Analyst)

Super clear. Thank you.

Operator (participant)

Our next question comes from Graham Hunt from Jefferies. Please go ahead.

Graham Hunt (Equity Research Analyst)

Yeah, thanks very much for the questions. I'll ask two, if that's okay. Firstly, we read a lot at the moment about the impacts of AI and both in terms of pressure on white-collar industries, but also technologies which I think are relevant to your portfolio, like increased presence of autonomous vehicles. Just wondered your thoughts on, well, how you're thinking about these potential threats or developments with respect to Ferrovial's discretionary lane plans? Is it coming into your thinking as you prepare for bids on the upcoming projects, which you highlight are in the pipeline? The second question, just so on dividends, upstream dividends, just where do we stand or where is your thinking in terms of assets, and whether you can increase that to increase upstream dividends across the U.S. and Canada there? Thank you.

Ignacio Madridejos (CEO)

Thank you, Graham. I will take the first one, Ernesto, the second off. I mean, we could not hear you very well, the second question, but I will try to answer. Regarding AI, and autonomous vehicles, we have followed some research done by third parties, about what will be the implications of especially autonomous vehicle, because AI is a little bit more difficult and probably new. In the case of autonomous vehicles, main conclusion is that, at least in the short term, what we see is more traffic. It will be probably autonomous cars moving more than the cars today, and so will be more traffic and congestion.

Especially that will create more congestion when they are running at the same time with the cars driving by human beings. I think that the short term, we see that as a positive thing. The implication of AI is a little bit more difficult? I think there are different versions, if they will maintain the employment, but the people doing different things, or there will be a reduction of in general, white collars?

Of course, some cities will be stronger, depending on the type of work, workers that they have and the type of industries and the type of things that they do. As long as we can have some information about this, and we can incorporate in the models, we'll do. So far, there are more research about autonomous vehicle and less about artificial intelligence. As long as we get more information, of course, we'll incorporate in our models and of course, in the bidding process.

Ernesto López Mozo (CFO)

Yeah, thanks, Graham. If I, if I listen well, the question was regarding the possibility of helping uplift dividends from our projects like the 407 and managed lanes with some additional leverage. Yeah, this is a question we get recurrently asked. I mean, clearly the 407 is very with very comfortable ratios, so we could be seeing some uplift there. Don't expect like a big bank, but yeah, I mean, there could be a improvement in the dividends just because there's a sample capacity there.

Regarding the managed lanes, you know, that always the optimal in terms of relevering is comparing with the business plan that was submitted. Where we could have, not in the near term, but not too far away from additional leverage on the I-66. Those are the main ones, 407 and I-66. We could have some angle in others, but we will update in due course the market. Yeah, the summary is that, yes, we have some headroom there.

Graham Hunt (Equity Research Analyst)

Super clear. Thank you. Thank you.

Operator (participant)

Our next question comes from Ruairi Cullinane, from RBC Capital Markets. Please go ahead.

Ruairi Cullinane (Equity Research Analyst)

Yes, thank you. Please, could you provide some commentary on pricing on the I-66 and I-77 at the start of the year? Would it be reasonable to assume another year of double-digit pricing increases in terms of revenue transaction growth on these assets? Secondly, you have a strong Q4 across all construction businesses, and I was wondering what drove the more than doubling of EBITDA in Ferrovial Construction. Finally, on the Schedule 22 provision, seems like there are a few sort of moving parts that could drive that this year. On the one hand, higher tolls, but also perhaps more rush hour traffic and further targeted promotions. Would you be willing to say for overall, we could expect a decrease in Schedule 22 payments? Thank you.

Ignacio Madridejos (CEO)

Okay. Thank you. Thank you for the questions. As you know, we are not giving any guidance, no, about this year, 2026, no, in terms of pricing. The only comment that I made, no, during the presentation is that in the I-66, we expect that the toll rates will increase above inflation. The only thing or the only comment is that, as you know, no, this is a toll rates are increasing based on the value to users, no. It is better related to congestion and increase of population and economic activity, and as long that is happening and there is value for users, we'll try to capture, and especially I-66 and I-77, that we have freedom to set the toll rates, no.

As commented, we are not giving any guidance. In the case of construction business, the margin for the year was 4.6% EBIT margin. I commented that especially in the fourth quarter, we have some positive developments in some markets with the change orders or also some projects that were at the latest stages that the risk are eliminated. There were some February positive things that happened at the end of the fourth quarter, but we are not giving any guidance of following years or what is going to happen next, no?

In terms of Schedule 22, again, as commented previously, what we are trying to do with the promotions is to maximize EBITDA, and part of the question, of course, is the traffic, is the revenue per transaction, but also is the Schedule 22. We consider the three things, no, whenever we define what is the toll rate increase for the next year and the promotions that we are launching during the year.

As you know, we have different sectors, and in some sectors, it makes sense to increase promotions, in other, less, and depending on that, we can pay a Schedule 22, depending on the traffic or not, no. The objective is not that to be a number that is zero, but to maximize EBITDA. We consider all things together, to take the best decisions in order to maximize EBITDA. That is the main KPI that we need to follow in the 407 ETR.

Ruairi Cullinane (Equity Research Analyst)

Thank you.

Operator (participant)

Our next question comes from Elodie Rall from JPMorgan. Please go ahead.

Elodie Rall (Managing Director)

Hi, thanks for taking my questions. Just to come back to the 407, I was wondering if there has been any pushback politically or in the press to the tariff increase, that you have announced, for 2026? Also, I know we've talked a bit on that, but in term of promotions, for 2026, should we expect a similar impact to 2025, or will you increase the intensity there? With regard to the NTO, you said the opening now is pushed to the fall.

Realistically, when should we start to expect any impact to numbers? When will we get a bit more visibility on the financials there, and when would you communicate? Lastly, maybe it would be an opportunity to meet at this stage, but your 2024, 2026 period, you know, on the annualized guidance or strategic update is ending obviously this year. Are you planning anything to update the market on strategy, shareholder return, maybe the opening of the NTO? Thanks.

Ignacio Madridejos (CEO)

Thank you, Elodie. About the four oh seven, and about the new toll rate announcement, I think that we have to see this about the toll rates in combination with the promotions. Because I think that many users in the Toronto area are benefiting from some of the promotions that we are doing, and we have to see all in combination. I'm not aware about any, I mean, relevant pushback to the toll rate increase and to the promotions that we are doing. What we are doing or plan to do this year, 2026, the focus will continue to be similar to previous year on peak hour, as it was the case last year.

Also we'll try to segment more and more, no? Looking for better understanding of the customer behavior and how we can contribute to value to them and also to us to maximize. About that, we need to learn, no? It will be step by step, and we'll try to do some promotions on some activity to learn, most of it, the bulk will be similar to previous year regarding peak hour. As commented, we'll do other things to see how we can increase value to users and maximize EBITDA. NTO, as commented, yes, it was, is now.

The contractor told us that they expect a date in the fall, 2026, and, yeah, we have a review, no, the schedule with the different milestones, and, yeah, we have to wait until specific date to opening. We are not going to give any financial information, at least, for the time being, until they start opening and with the first numbers of NTO. At that time, I mean, we'll start to communicate a number, no? For the time being, only communicate opening date and the number of hyperscalers that have signed or anchor user agreement or a letter of intent, not anything else for the time being.

Yes, we are, we are ending the Horizon 26 plan, that this is the last year. It's an important year. It's a 2024-2026 plan, many things that we need to deliver during this year, that's the focus that we have today. After that, we'll, I mean, think or prepare a new plan that will work during this year. Once it is prepared, we'll think about how we are going to communicate or what things so the plan will be communicated externally. So far, I mean, we have not finalized the plan and not taken any decision about the communication.

Elodie Rall (Managing Director)

Okay, thanks very much.

Operator (participant)

Our following question comes from Dario Maglione from BNP Paribas. Please go ahead.

Dario Maglione (VP of Equity Research)

Hi, congratulations for an amazing 2025. I have three questions on the U.S., managed lanes past performance. On the I-66, Q4 was quite weak compared to Q3, but it was the government shutdown. What kind of, let's say, revenue traffic did you see in December after the government shutdown has ended? Did you see, like, a normalization of the trends or some weakness remained? On the LBJ, I was a bit surprised by the slowdown there, and you mentioned construction works. Do you expect these construction works on, I guess, feeding traffic roads to continue in 2026? Last question on the I-77, instead surprised me on the positive side against tough comps. Here, the revenue per transactions was very high, similar to Q3, despite much lower traffic volumes. Can you tell us more about why that is the case and whether this dynamic is sustainable in 2026? Thanks.

Ignacio Madridejos (CEO)

Thank you, Dario. Regarding the I-66, yes, the fourth quarter was affected by the shutdown, 43 days, and also by winter weather, no? That was worse than previous quarters. It affected mainly that mixed traffic and especially commuters at the peak time. That was the main effect was related to that, no, that we have less commuter at peak, that they usually have higher toll rates than in other times of the day. Also, you have to take into consideration that the comparison of the fourth quarter is that also we have a relevant increase in the fourth quarter last year with the dynamic prices that was communicated before by Ernesto in all the quarters calls.

It was a tougher comparison also to consider. Again, as I commented before, we expect to grow the toll rates in the I-66 above inflation because of the value to users and the activity that we see in the corridor. LBJ, the problem is that we have construction that around the LBJ in different projects that is not under our control. In some cases, you see more impact, depending where they are working and how they are affecting the number of lanes and the rest of the traffic. It's very difficult to anticipate, no, if in one quarter is improving and another is probably a little bit deteriorating versus the previous one.

What we see is that they expect, no, because it's not our construction work, that it will be finalized by the end of this year. We don't know exactly when it will happen in phases, or it may happen that suddenly one quarter is better, and then the next, we see some negative, no, affecting our traffic, because they are doing something specific, no? It's very difficult to anticipate. Also, by the end of the year, we expect that it will be back to normal, and it may happen that some quarters are better because the way they are doing the work is helping with the traffic, no? Anyhow, the whole, I mean, traffic back to the corridor, it will happen once the full construction is finished, eh? In the case of the I-77, remember also with the traffic, we have this comparison with the last year.

If you remember, we have the closure of lanes because of the hurricane, and that increased the traffic in the last quarter of the year. Even we have some effect at the beginning of 2025 that they will see as a comparison. In terms of toll rates, revenue per transaction, well, we continue on understanding or see the value to users and then try to try to get that value to us. I think that has been good in some peak hours in the traffic, and because of that, we have been able to increase the revenue per transaction and at the end, maximizing the video, no. As I commented, Charlotte is a region that is growing and especially in terms of new jobs in the U.S., and it looks like it has a good perspective in the following years, no.

Dario Maglione (VP of Equity Research)

Okay. Thank you. Thank you.

Operator (participant)

Our next question comes from Marcin Wojtal from Bank of America. Please go ahead.

Marcin Wojtal (Senior Equity Analyst)

Yes. Hello. I have a couple of questions. Firstly, just a follow-up on the NTO project, which is delayed to fall 2026. Is there any increase in the cost of the project for you? Is there any extra equity that you need to contribute? Is there any impact on your equity IRR due to the delay of that project? Question number two, if we could just perhaps go back to the 407 ETR dividend increase, which was very significant, 36%, I believe, in 2025. Could you just remind us, how do you think about dividend policy of that asset? Do you still consider the 407 ETR to be under-levered as it is today?

Maybe if I can squeeze in one more regarding your U.S. listing. I mean, that is a recurrent question, but are you considering any further steps on the journey to become more of a U.S. company, perhaps a switch to US GAAP accounting or any other steps that you are considering? Thank you.

Ignacio Madridejos (CEO)

Thank you, Marcin. I will take the first one, and Ernesto López Mozo will take the last two questions that you are asking. Regarding the cost, no, the project is substantially close to the budget numbers at this point in time. Our expectations is the deviation will not be material, and it will depend on how successful are certain claims, no, presented by the contractor. As of today, we don't expect any additional equity funding for phase A. The delay that we are seeing today is minor, no? It is a few months, it's not affecting us the IRR, no. It's a minimum thing that will not have any effect on the total project, no? The negative effect that we have in this period of time is related to the revenues, not that we are not collecting, no. No more than that, the impact is minimum.

Ernesto López Mozo (CFO)

Okay, well, regarding the capital structure of the 407, I mean, really, the leverage should reflect the solid financial performance, right? With the performance it has, it keeps getting headroom in ratings. I mean, it doesn't make sense, right? The capital structure should be adequate to the current ratings, right? Not get, let's say, an upgrade, right? Yeah, that would follow that opportunity as I mentioned in another question that was regarding the dividends for the 407. Regarding the US listing, if we are looking to do U.S., GAAP or not, the market is not asking for that now.

Of course, we've analyzed that, it could make sense going forward. We have done our analysis to try and get ready. I mean, there's no current demand for that at the moment. No, not in the short term, no, we won't be doing U.S., GAAP.

Operator (participant)

Yep. Thank you. Our following question comes from Jose Manuel Arroyo from Santander. Please go ahead.

Jose Manuel Arroyo (Equity Research Analyst)

Thank you. Thank you. I have just one question, it's about the revenue sharing payments in the Q4, particularly at NTE and I-77. I found them a little bit above average, I think they ended above the annual budget for both highways. Was there anything different in the Q4, or was it just a recalculation for some particular reason of the annual provision? Looking at 2026, I noticed that for I-77, you are budgeting about 50% increase in the revenue sharing provision for I-77. Why would that be? Or is it just a conservative assessment? Thank you.

Ernesto López Mozo (CFO)

Hey. Hi, Jose Manuel. Just, I mean, as you, as you mentioned, it was online with the budget, the revenue share. The fact was that the budget was being outperformed, right? There was a catch-up in the accrual at the end. Going forward, it makes sense to do that more along the year, right? Rather than reflecting the budget. We should expect more correlation with the performance along the year as we do with the Schedule 22s. It just reflected that. Regarding the I-77 revenue share budget for next year, yes, the budget considers that there's a, let's say, a move into another bracket of revenue sharing.

When that happens, there's an effect that it looks like a lot that then is not as that going forward, right? When you get into a different bracket of sharing, you kind of get this effect, because it looks into the accumulated stuff, right? You can check that with the Excels, we provide that effect. As I said, the following year won't be that substantial. It's just an effect of changing into a different bracket.

Operator (participant)

Our last question comes from Cristian Nedelcu from UBS. Please go ahead.

Cristian Nedelcu (Executive Director)

Thank you very much. Could I please check the 407 loyalty plan that you talk about? Could you give us a bit more details? Does it mean more? Is the purpose to get more traffic, but you could give more discounts, or how do you think about it? Can I also ask on the NTE that you mentioned the construction works will end at the end of 2026. How should we think once that happens, how should we think at traffic accelerating versus less mandatory modes? Net, net, you expect revenue to still grow once construction ends? The last one, there's a bunch of tenders for express laning in the U.S.

You made a proposal for the Washington airport. There's a lot of CapEx there on the midterm and long term, and even if you take a 35%-40% equity of that CapEx, you're talking about very large amounts. Conceptually, can you tell us a bit, how do you think about firepower? You know, there are all these projects, but I guess there is a limit at some point, you cannot do all of them. Could you elaborate a little bit how you think about this? Thank you.

Ignacio Madridejos (CEO)

Thank you. Thank you, Cristian. About this loyalty plan, as commented, no, we'll continue with promotions in 2026. It was very positive from our perspective in 2025, helping us to maximize EBITDA, and we'll continue to do that this year. Again, the bulk of most of the promotions will be at peak hours, similar to what we did in 2025. Of course, with the learnings, know that we had a large year, we continue improving and trying to get more value to user, but also maximizing the EBITDA to us.

One of the things that we'll try is a loyalty program, but it's something that we'll see how it works, and similar, what we'll try to do is try to get some additional segmentation and learning and seeing how the users see the value, and based on that, we can do more segmented type of offers in the future, no? Again, bulk will be portions will be very similar to what we did last year, but with the learnings that we had, because this is just the second year, we are continue learning. Of course, this is a long, I mean, during many years, I mean, we'll see more and more segmentation, more value to users, and maximizing EBITDA for us, no?

In the terms of NTE, yes, the construction will end by the end of this year, and what we'll see at that point of time is our expectation is, directionally, is that more traffic will come back to the corridor. As you know, what happen when you have a construction and there is some congestion, then some of the traffic takes a different route that probably for them is shorter, and some of the trips that we used to have, well, they disappear, no? Once the situation is back to normal, then we'll start to see more traffic. It will take some time will ramp up, no? That they learn that probably they have savings taking this corridor versus the alternative that they are taking today.

We'll see more traffic, but also at the same time, with this more traffic at the end of the construction, we'll see less congestion, no? At the end we are adding one new managed lanes in one sector and one additional general purpose lanes in other sector, no? There is more capacity in the corridor. It will bring more traffic, less congestion, and probably less mandatory modes, no. We are not giving any guidelines about what effect that could have in revenues, and well, you have to wait to see, no, the numbers, how is the effect, no, in the future. Yes, regarding the opportunities, as commented, no, we see quite unique pipeline of opportunities in the U.S., no?

Nothing that we have seen before. It's not, as you know, we are building two managed lanes this year, the 77 South, next year. We see other managed lanes that will come very soon, hopefully in Atlanta and Charlotte and then Nashville, sorry, and others that they were working on and were in the pipeline. Yeah, as you know, we want also to expand airports in the U.S., something similar to NTO. There may be other opportunities, so it's quite unique in terms of pipeline of opportunities. At the same time, we are not expecting to win all of them, no. As you know, we are very fine discipline from a financial point of view. For us is not only growing, it's creating value, no, while growing, no. The firepower, maybe Ernesto can comment more about that.

Ernesto López Mozo (CFO)

Yeah. Thanks, Ignacio. As we presented the Capital Markets Day, and we tend to answer this, we usually don't have leverage at the ex-infrastructure project level. With good opportunities to growth, we could go to the leverage headroom that the BBB rating allows. We don't comment what are the ratios that rating agencies have. As a proxy, we have our internal 2x net debt to EBITDA, and EBITDA is composed of dividends we get from projects that have substantial potential and also the EBITDA from other businesses like construction. That is the kind of proxy we use, and then we could use that leverage for firepower.

Operator (participant)

There are no further questions at this time. I will now hand it back to Silvia Ruiz, Global Head of IR.

Silvia Ruiz (Global Head of Investor Relations)

Thank you. Well, it seems that there are no questions in the webcast, I will hand over to Ignacio.

Ignacio Madridejos (CEO)

Thank you, everyone, for your participation in this conference call. Now we close it. Thank you very much for your participation.