Operator:

Begoña Morenés: Good afternoon everybody and welcome to Ferrovial's conference call to discuss the Financial Results for the First Nine months of 2021. Just as a reminder, both the results report and presentation are available to you on our website. As in previous results, and although some restrictions to mobility have been lifted during the first nine months of the year, we would like to highlight the financial information included in our report has been impacted by COVID-19 outbreak, mainly since the second half of March 2020. Given the uncertainty regarding the speed and the extent of the full resumption in activity, it is not possible to predict how the health crisis will affect Ferrovial's group information and performance for the rest of 2021. Ferrovial will continue to closely monitor trading conditions and further evidence of wider economic impact. I am joined here today by Ernesto Lopez Mozo, our CFO; and the CFOs of our business units. If you have any questions, you may ask them through the forum included in the webcast. During the Q&A session, at the end of this presentation, we will be reading out your questions and who they are from. With this, I will hand over to Mr. Lopez Mozo Ernesto, the floor is yours. Ernesto Lopez Mozo: Thank you, Begoña, and hi everybody. So this presentation, we have more stuff than usual. Not only will we cover the results for the first nine months of the year, but also discuss the different divestments and capital allocation that is taking place in the group. If we -- on the first slide, the overview of the first nine months, in the managed lanes in Texas we've seen strong traffic performance even though during the summer, there was a surge in cases that affected, dampening a little bit the performance. But in any case, the strong revenue per transaction growth has brought higher revenues on the back of higher toll rates and a higher proportion of heavy vehicles. Also, the I-77 keeps improving in Q3, traffic is above pre-COVID-19, and revenues are accelerating even faster. On the I-66, we were able to exercise the right of first refusal, increasing our participation by 5.704%. This additional stake makes us reach 55.704%. In the 407ETR, we saw a solid traffic recovery with mobility restrictions and change since mid-July. Well, more than solid is steady. I mean traffic is recovering, but clearly the region is still being cautious about the pandemic. Health is a priority and in general, employers are asking employees not to go back to the office. Very important news from the 407ETR, there was a resumption of dividends. The dividend has been approved for this fourth quarter of the year. Regarding airports, clearly the summer saw more restrictions than we were expecting. In particular, in the UK there were a lot of travel system updates, India’s restrictions put back travelers and they have been postponing their plans. With restrictions being lifted now and basically more freedom to move for people that have been vaccinated for most countries, there has been a surge in demand and traffic performance and the fall is recovering nicely and really pointing to the kind of forecast that Heathrow had before the summer. The CAA's initial proposals for the next regulatory period, H7 are disappointing. They provided wide ranges in terms of pricing and cash flow generation. There's a big disparity or gap with Heathrow's estimates. We'll discuss that later. In AGS, well, there's not really news in terms of refinances, they happened before. I won't dwell into that performance, the same as in Heathrow was affected in December that is recovering now nicely. Regarding contracting, construction delivered strong numbers, 2.4% EBIT to sales margin with the mix still outperforming. Also, the program of sale of non-core assets by construction was finalized. So a number of them successful transactions, all of them have been flowing through to our books and they are complete right now. Services is showing a very strong performance across the board that is helping closing the divestments that were in place. In July, we reached an agreement to sell the environmental business in Spain and Portugal. And we just got the approval from the European Commission in terms of competition. So by the end of November, we should be closing that important transaction. And today, we also announced an agreement for the sale of the infrastructure services in Spain. We'll discuss that later. In terms of capital allocation, I-66 as already commented. And we also submitted an offer to acquire a participation through a capital increase and participation of 24.9% in IRB, an Indian listed company very successful infrastructure developer there, more on that later. And also in terms of investment, the Board approved an additional up to €200 million of treasury stock share, buybacks, shares that after being bought, they will be canceled or amortized. We really closed the quarter with a strong financial situation. Net cash, ex-infrastructure of €1.8 billion and remember that big divestments are coming up soon. So the end of the year should have a very strong position. We move to discuss the operating performance. We see the growth in revenues and EBITDA from toll roads and we also have the line for equity accounted. All of them grew nicely vis-a-vis last year. We will compare in the coming graphs more the performance against pre-pandemic. But clearly, the U.S. is showing all the growth that could be coming from those assets. And we as I said, we will discuss this in turn individually. I would like to put some attention into roads that are being developed and will come in the not-too-distant future. In terms of managed lanes we have the 35 West that should come up before the end of 2023, the I-66 at the end of 2022, so they are coming up fast. We are investing there as we show in the slide. The other four that we put in there are availabilities and they are also being completed, many of them. And therefore, we should be adding all this infrastructure to our portfolio. In terms of sales, the only one remain is a very small part, close to €25 million of the Portuguese toll roads. This should be closed either at the end -- before the end of this year or probably in the first quarter. So there's only that left in terms of sales in these assets. Moving to the specific performance of traffic in the managed lanes. Well, the graphs show the trend continuing. We have the latest data that are in some squares here in green. For NTE and 35 West, we can see that they are above the COVID levels 2019, not yet in LBJ, but still good performance. I mean we see that in the summer, there was some dips from -- I mean -- or slightly less growth from the surge in COVID and also, we have other events that happen along the year, like heavy rains in May or the winter storm impact in February. So if we move to the next slide, we can see the revenue performance vis-a-vis the traffic performance. Well, so we can see that the growth in the 35 West and NTE of revenues clearly outpaces the growth in traffic, more so in the 35 West and also in the I-77. The I-77 now has heavy traffic, and that mix is helping even though the proportion of heavy vehicles in this road is much smaller than in the other managed lanes. LBJ is still not there. LBJ is still, I mean is serving a white-collar community, still with an important percentage of work from home. If we move to the specific financial numbers of these managed lanes, I would like to highlight the growth in average revenue per transaction and as I said, this is a mix of growth in tariffs, mix with more heavy vehicles. And also, we need to remember that in the NTE, we have mandatory mode events and these are -- there's even a higher number of mandatory mode events in NTE now in September than they were pre-pandemic in February 2020. So whenever there's this kind of situation, we have to price above the soft cap with an algorithm. So that helps also to increase the revenue per transaction, obviously. So in terms of updating the regions, the latest news, I would like to highlight some indicators that we are following now more to be consistent among the different places. We are following mobility at workplaces across the different places where we operate. And in Dallas County in mobility to workplaces is 18% below 2019. This is coming from Google mobility. So still well below pre-pandemic. And this is something that in other regions is even higher. So still some way to go to have more people back in the office. In terms of the schools, they are mostly in person, vaccination reached between 60% to 70% of population fully vaccinated. And it's important to underscore the level of activity in terms of new companies settling there, also growth in population. So there's a variety of businesses that is moving here or just not only for logistics or for manufacturing, also headquarters are being placed here, like's the case of AECOM. So we move to discuss the I-77 on the next slide. Here again we see a very important growth as we saw in previous graphs. As I mentioned before, we have now trucks going through our roads. This is helping in terms of performance, but also the area is growing in employment, population but still is behind other regions in terms of mobility at workplaces. So if we look at the same KPI that we were following in Dallas-Fort Worth, here, we have 34% below 2019. Remember, it was like 18% in Dallas-Fort Worth, okay. So North Carolina is still behind Dallas-Fort Worth. So moving on to the I-66, more than showing traffic performance remember, it's not opened, but the corridor is showing similar patterns, still a drop vis-a-vis 2019. But clearly, with more traffic per lane than other areas. In particular, it has more traffic per lane than LBJ in 2019. And it's very important to see some of the features of this road that are somehow different to the ones in Texas. We are adding capacity, but not that much. I mean the current configuration is three general-purpose lanes plus one HOV, in high-occupancy vehicles lane. And we are changing to a configuration of the same number of general-purpose lanes three, and we will have to manage lanes in each direction. Pricing is flexible. There's no soft cap here, and this freedom to set heavy multipliers. Also, this road is longer. I mean you said 22 miles vis-à-vis, for instance, of like 13 miles in NTE with a concession term that finished in 2066 and with a total project investment of $3.6 billion, right. So we're still investing in this asset and the acquisition of this stake means that we acquire control. And there's an accounting rule that forces us to mark up to market when the transaction closes, the whole stake at fair market value, right. So we will see a huge capital gain. It's not an accounting rule that we like, it is the way it is. We cannot avoid it. And we will be having a very important capital gain. I mean north probably of €1 billion before deferred tax liabilities. It will be globally integrated when the transaction is approved. The area has high congestion levels already, as I mentioned before, I mean it's better than LBJ in 2019. Household income is higher, $100,000 versus $70,000 in Texas. And people are used there's other tolls in the area and people are used to paying tolls, sometimes they are quite high. So I mean these are some of the main features I wanted to share with you of the I-66, to put some color on the acquisition of the controlling stake earlier in this quarter. Moving into the 407, we see the traffic performance. As I said at the beginning, it's trending upwards, still not really full reopening from, let's say, the public mind, and that is probably the most important thing. Also, there's still some restrictions in terms of indoor activity. But it keeps reopening. We will have to see when employers ask their employees for more normality. It's early days. It's difficult to tell. I mean the latest number we have is a drop of 21.5% in terms of traffic vis-à-vis 2019. So improving, but still slowly, as I said, a lot of caution that can be seen in the next slide when we check parameters similar to the ones we were discussing for Dallas-Fort Worth or for North Carolina. So you see that the mobility to/from workplaces is kind of 44% down vis-à-vis the pre-pandemic. We remember this compares with the 30-plus in North Carolina and 18% in Dallas-Fort Worth. Also, when you look into days of school fully closed, you see that Canada really tops an international chart. So I mean they've been pretty much closed the full year and the year before. In terms of percentage of employees in the office, you see that Canada lags U.S. and Europe, clearly. So we'll have to assess more the performance of the asset going forward when we see more of reopening and people feel the pandemic is left behind. If we move to next slide, we can see the financial performance and here, I would like to highlight the announcement of dividend. The Board just approved that, Canadian $300 million is the dividend approved. And still, the company has a very solid financial position, a lot of liquidity at the end of September 2021. It had Canadian $790 million of cash and equivalents, and it had Canadian $800 million in terms of credit facilities. So the 407 is clearly a very comfortable situation in terms of liquidity and to satisfy their financial obligations, there's no meaningful bond maturities until September next year, that is around Canadian $300 million. So the maturity profile is quite friendly, I would say. So very good to see the asset resuming dividends and looking forward to the performance in the end of the year and next year with more reopening. We move to the next slide. We see Heathrow's performance. I mean it's just so -- with the Heathrow's management was discussing the performance, of course, traffic has seen quite a drop compared to 2020, even though 2020 was affected by the pandemic, it had a very good first quarter before the pandemic. So traffic is still an important drop. But in general, the revenues are holding, and there's a lot of effort from a cost contention, CAPEX contention point of view. So it's holding and more importantly, traffic seems to be recovering more with this relaxation of travel restrictions, and people are just waiting to travel. So if we move to the next slide, to discuss the regulation and different outlooks for the asset. Well, we see that the traffic estimates by Heathrow are pretty much in line with what they thought before the summer. And this is because of the recovery we are seeing now because the summer was a little bit disappointing with all these restrictions and changes in the traffic light system for travel. And we have seen the initial proposals from the CAA. I mean I have to be blunt, and we are quite disappointed with these initial proposals. Among other things, there is no RAB restatement further from the 300 interim that was allowed. I mean this is very important. I mean there's huge investment going into these assets, and you can take the benefit of seeing these pictures at the bottom of the page, I mean, all these investments to change old terminal to the new one are huge and are predicated on an expectation on CAPEX that is efficiently incurred should be recovered and should have a minimum return. And in that regard, also the framework provided a lot beta along with that, of course, didn't consider extreme scenarios. And in terms of risk assessment, there was even the statements that under extraordinary circumstances, this could be reviewed, right. So it's tough to see that you don't recover the principle of the investment that is kind of a shock for any investor in regulated businesses, right. So just that, I mean just depreciating an asset without any usage or traffic paying for it means that we are losing as investors, 1.3 billion of principal of the investment, right. And also, you -- I mean, the fact that the minimal return on the overall RAB is not considered means that we forgo another similar amount, right. So a lot of investment goes in these types of assets under some predictability and, let's say, kind of low risk. Clearly, the situation has not been answered on the way we expected. In terms of other parameters, I would like to say that they are also way different from what Heathrow was expecting. It's a very wide range of tariffs, but also of traffic and OPEX and what Heathrow really explained well the differences that they fail to reconcile, right. So I expect a lot of documents to show why we have this disparity with these estimates from the regulator. So during this fall and up to the year-end, there will be comments and probably the final proposals will be in the first quarter or second quarter and the final license modifications will be at the end of the first half of 2022. So if we move to the next slide in AGS, I made the comments at the beginning, the -- pardon me, the summer was a little bit disappointing, but the same as Heathrow now, we're seeing good traffic with restrictions being lifted and the company put an effort again on cost contention, and that has helped the operational performance, the refinancing of AGS took place in the first half of the year. And there's no further news really material for this quarter to comment. So if we move on to the next slide, we touch on construction. Top right corner, we run through the -- have a rundown of the different asset sales that took place. As I said, quite successful and now they're over, so the real estate at Budimex, recycled aggregates at Webber, U.S. $140 million. And then other participations in the Spain, in URBICSA for €17 million, supplier payment portals where we had 19.86% of what's called Nalanda Global as well and also a concession on the Prisiones maintenance, okay. So all this is pretty much done and has helped the cash performance of the division. Also, the order book finishes at record levels, have been successful contracting. So north of €12 billion and well, we still have some pending to incorporate into the backlog but not as much as in other occasions, €380 million contracts. Regarding the performance, I think that it's a solid performance, even taking into account that there's already some pressure on some raw materials, pressure on resources and inflation. So we've seen that happening across the board. But nevertheless, we've seen good performance. I also give some information here of the infrastructure maintenance services in U.S. and Canada. This was part of the services perimeter, but it makes sense to keep it, it's complementary, and has synergies with construction in the U.S. and Canada. And to give you an idea, it has an EBIT to sales -- an EBIT margin of €9 million -- sorry, an EBITDA of €9 million, and it's a solid EBIT margin against €134 million of sales. The kind of profitability that this business is bringing is similar to the one that has been sold of SCC, the recycled aggregates at Webber that was sold. So this should replace then that kind of profitability. In terms of other areas, Budimex is really trading at a very strong pace with EBIT margin that even if we take out the extraordinary impact of the release or results related to the real estate -- construction related to real estate business, even if we take that out, the ordinary margin is 6%, that is quite high for this business. And well, in terms of outlooks for the division, as I said, we still see pressure in prices and resources, but the way it's being managed, I think it's remarkable that we tend to fix prices in advance and also manage more cell phone resources when there's a lot of activity. Well, the outlook is still that the second part of the year, the U.S. should consume cash, all these big projects are being developed and trying to accelerate will consume cash. It's also true that many of these backlog, these projects that were awarded will bring some advance payments. So moving on to services, I would like to touch on the divestment we announced of infrastructure services. And here, we announced the sale and also a partial reinvestment. So this is a business that in 2020 posted an EBITDA of €29 million. Maybe this year should be around €34 million, so growing slightly. And the reason we reinvest is twofold. I mean the main one is that there's clearly appetite in the market to be -- for players to log on to a platform where they could dilute overhead expenses, and that could be I mean, a lot of synergies could be freed there and value could be created. And therefore, -- we could capture more value for that. It's an interesting business proposition. And also, we have announced that if we deliver along the business plan, projection should be like another € 50 million, right. So the reason to do that is, we think, is a good business proposition. It's better to be close to the earn-outs, but more important, I think that the sector is looking for this sort of platform that could dilute overheads and grow because, I mean, there's a lot of activity in this regard, expecting to happen. So the environmental services in Spain and Portugal as I mentioned should be closed by the end of November, given it got regulatory approvals. Nothing else to comment here. The rest of the processes are advancing, right. I mean we are looking at Amey, oil and gas in the U.S. and mining services in Chile. So probably, I mean, I will take advantage and move into next slide to discuss what's been left. And here, probably the 2020 EBITDA falls a little bit short of what these businesses could be bringing, right. So in terms of the A-2 Aravia, this is a maintenance concession that on a normal year should make north of €30 million of EBITDA. But of course, it has leveraged, and we have to look at the value in terms of the dividends it can bring. But it was part of the EBITDA you always saw in the services division in Spain, always making kind of north of €30 million. Then you have Siemsa that is regarding industrial maintenance of equipment and electric equipment, in particular, also an EBITDA of €2 million that should be higher on a normal year. Energy efficiency, that probably should be north of €10 million on a normal year and growing to €20 million pretty easily. And then we have EMESA that is a company that owns a stake on the venture that maintains the Ring Road and the tunnels in Madrid City. So this is the kind of the equity method we missile we were consolidating, it is the kind of EBITDA in terms of contribution, it was just €6 million in 2020, right. But it has -- value of this EMESA and Aravia are more concessions that eventually, I mean, will be sold or will get dividends and should be measured in that way. But it's an important chunk, nevertheless. And well, last, I would like to highlight the performance of Amey, it is recovering nicely. I mean this is the perimeter that we said being sold and is doing well in what we call [indiscernible] maintenance for Ministry of Defense and Justice. And at the same time, also highway maintenance and rail. So in general, it means it's performing. It's the last one we have -- a big one we have for sale, right. So if we move to the next slide, in terms of ESG highlights, I won't go through all the different accomplishments and so on. I would like just to touch on two things that probably has caught your eye. One of them is we acquired ready-to-build 50-megawatts photovoltaic solar plant in Spain from InfraRed, this is for self-consumption. And as I mentioned, it is something we're going to build. We'll have orders along the road that will help us in our goal of 100% renewable energy in 2030 for our consumption. Another milestone I would like to highlight is the push that Heathrow is doing with sustainable aviation fuel. Now for the COP 26 in Glasgow, all the flights between Glasgow and Heathrow will be powered by sustainable aviation fuel, and Heathrow will have a standard showing how much can be decarbonized from aviation. So looking forward to all that, and you're invited to visit that. So we move on to the next slide. Here, we cover the financial performance below EBIT. And here, we have the financial results, I will separate them between ex-infrastructure projects and infrastructure projects. Ex-infrastructure projects, we have an increase in financial expenses. This has to do with higher gross debt that we have from the pandemic. Rates on cash are now lower, and we have more gross debt. This will be sorted out along time. Really, we didn't see those big opportunities during the pandemic. And now I will show that we are delivering on capital allocation, but these kind of levels of gross debt and cash probably are not really worth it right now, if I may say. If we look into the infrastructure projects, here, the impact comes from interest-linked swap and inflation swap that is speculative on non-recourse project where we basically have no value. Our accounting value is minus 154 million. Of course, in any case, we tried unwinding that some time ago, but we couldn't get a deal done with the banks and the fellow shareholders. It will remain there. But as I said, it's noise, it's not that affects our value at all. I mean that has negligible value. It shouldn't be taken into account. Then moving below those levels, we get into the discontinued operations results, and you see that we recognize results as long as they are below the fair value that we think we can achieve for the assets, and that's the reason why we have that positive results, okay. So all in all, these discontinued operations are contributing. As I said, divestments are following a good pace now and hopefully, in not too distant future, they will be over. So we move to the next slide, I mean, we see the cash generation. I would like to highlight maybe three things here. I mean one of them is that we are investing more than other years, this is a good sign. I mean we are investing in assets that can create a lot of value. Divestments have more than covered for that. Then, of course, we have shareholder remuneration, and we have other financing flows. And in other financing flows, here, we have mainly the deconsolidation of the net cash that was at the real estate business in Poland that is north of €100 million. And also, we have the dividends that Budimex has paid to minority shareholders. So all that pretty much makes up all the €156 million that we see in other financing cash flows, right. So good performance in terms of cash propped by divestments. And now we start getting dividends again from infrastructure. The first one to come by is the 407 and we expect other assets to be contributing in the coming months or next year. So if we move to the next slide, probably a lot of you have been waiting for this slide. I mean the first thing I would like to mention regarding our investment in India is that it sits at the heart of the Horizon 24 strategic plan. I mean we mentioned other geographies at the time, in particular, a little bit more Latin America. We think that Latin America in the coming years is going to be more unstable and with much fewer opportunities from an infrastructure point of view. India, on the other hand, has a growing market that is well-established with a very good pipeline and it's quite transparent with electronic billing, you can see pretty well how things are going in any operation. And what is important, I think that we found the best partner we could have, right. So if we are successful entering the company, as we expect, we are partnering with an infrastructure company that succeeds in the primary market. I mean, if you look at the different information we have, there's a huge number of global investors and infrastructure players that are crowding the secondary market. It's very difficult to get good assets in the, let's say, primary market, in particular, the ones that have traffic risk. I mean there's a lot coming up. You have the ones that don't have any traffic risk and here, I mean, the percentage that IRB guarding the path is not very high, something close to 5%. But on the deals we've seen, the latest deals in terms of traffic risk, they are close to 40%. Of course, the one -- with traffic risk, need more capital that's the reason why when we are entering with an equity injection because having a strong balance sheet here gives you a competitive edge for the most interesting assets. A lot of them are coming, these guys have done it well. They have a construction number that only operates for them. So it means that we have the resources in a market that has so much growth and could be overheating. I mean having your own stress to deliver is something that is very important. And of course, another of the things that we looked at and we checked is ESG. I mean these guys are compliant with the ESG rules in India. We know that they are not Western standards, but they also have a drive to improve this. And, of course, is the purpose that we have also to try and to bring a push for improvements here. And anything that can be done here is really welcome in particular in terms of health and safety. I already mentioned that billing is quite transparent, something that gives us a lot of comfort. And really moving ahead in terms of health and safety is something very important. Our construction arm want deploy presence there. I mean they will assist technically and it's not that we plan to do construction. As I said, this company is self-resourced in that regard. So just the numbers here could be impressive in terms of growth. I know that some of you guys have pointed out that this country has a high cost of capital. Well, yes. We have incorporated that in our valuation, we haven't incorporated any growth of concessions, and there should be -- I mean this is clearly the gist of the transaction. But these regions should grow in real terms substantially. Car ownership should grow a lot and population as well, right. So we are looking forward to this. This should be a great opportunity to growth. As I said, it lies perfectly in Horizon 24, tickets that we were probably deploying in other regions have been deployed here. Our focus continues to be in the U.S. high complexity concessions. We are seeing a little bit more color in those projects, looking forward to that. And as I said, it remains our priority, but we think this is -- it could be a great investment. As I said, it sits perfectly at the heart of what we mentioned. I mean we never commented India because we were more into Latin America, but we've been following this market, and it's probably the market that is more prone for growth in the coming decade. So we move to the next slide. This summarizes a little bit what I've been saying. I mean we have prequalified in the U.S. in three projects. We are discussing other new managed lanes that could be quite appealing, an NTE3C and I-66 are coming closer. Selective investment in other geographies, we already mentioned this in India. Development of new businesses. And here, we are looking for sustainable infra-related opportunities where we can add differential capabilities. You saw that there was a new appointment to our Management Committee and Gonzalo Nieto is the name will take care of energy, mobility, some new businesses and also take care of the businesses from services that are not yet sold. Some of them have to be overhauled, and he will be supervising that. And of course, last but not least, we have to balance industrial investment and shareholder return. The second Scrip dividend was approved, and we have added to the second Scrip dividend and the share buyback program that is still ongoing. We have added up to €200 million of treasury stock to buy shares to amortize them. So this is not for trading, of course. So okay, if we move on, now we can get into the Q&A session. I would encourage you to -- I mean, stay with us, bear with us until the end of the Q&A session because there's also an announcement not related to business, but that probably is good for you to hear when the Q&A is over. So please, let's get into the Q&A. Thank you. Begoña Morenés: Thank you, Ernesto. The Q&A session will begin shortly. Please bear with us. A - Begoña Morenés: So starting with the Q&A session. The first set of questions come from Alejandro Vigil from Bestinver. Alejandro Vigil: First question, looking at the potential investment in India, which is the targeted exposure to developing markets, is it 5 to 10 percentage of the total portfolio reasonable? Pedro Agustín Losada Hernández: Thanks Begoña, and thanks Alejandro for your question. This is Pedro Losada, Interim CFO. We don't have a specific allocation. We look at the emerging market and some opportunity -- opportunistic basis. So therefore, there's not a fixed allocation for emerging markets versus developed. So our focus is still as Ernesto has mentioned in the presentation, this is still in developed markets and high complexity concessional projects and particularly in North America. So again, look at this as a unique and task opportunity, but we look at this emerging market on an opportunistic basis. Thank you. Ernesto Lopez Mozo: Thanks, Alejandro. Complementing Pedro on other businesses. Well, in airports, it's pretty much asset by asset, right. So the asset has to be good. And usually, assets in airports are a little bit disconnected to the country where they are. So we will look at specific assets. And usually, they collect in higher currencies. So I wouldn't say we have kind of a geographic focus in airports. Transmission lines, yes, there could be something in emerging markets. But in general, as Pedro said, and we mentioned in the slides, the focus is in the big markets rather than focusing on a specific ticket. I would rather not say, it's going to be 500 million or 600 million. That's the total, maybe there could be a tweak to that. But in any case, it would be a fraction of what we are planning to dedicate to develop markets and in particular, the ones that we like the most, like U.S. or Canada? Begoña Morenés: Thank you, Ernesto and Pedro. The next question is also from Alejandro. Alejandro Vigil: Can you provide some information on the remaining assets and services after the recent disposals in terms of book value and/or capital employed? Ernesto Lopez Mozo: Thanks, Alejandro. I mean I won't get into book value. Probably, our book value is a little bit conservative, and I don't want to give a hint to players that are discussing transactions right now. I mean the color I gave is that I show the financial performance in the first nine months of Amey, for instance, that should be a good indication of how the asset is trading and probably that's all that's needed at this point in time. Begoña Morenés: Thank you, Ernesto. The last question from Alejandro. Alejandro Vigil: Would you allocate additional capital in Heathrow with the current price control proposal? Ignacio Gaston: Thank you, Begoña. Thank you, Alejandro. This is Ignacio Gaston from Ferrovial Airports. Alejandro, if we look at the past, results have not been very positive from an equity return standpoint, I would say, indeed, negative from a return standpoint. On the other hand, if you look at the future in the context of the initial proposals, further to your question, there are a couple of matters, lack of recovery of RAB and low equity returns that make me feel very skeptical about the appetite to contribute further capital into Heathrow. Begoña Morenés: Thank you, Ignacio. The next set of questions come from Patrick Creuset from Goldman Sachs. Patrick Creuset: First question, what level of 2019 traffic, do you see 407 traffic trending during October? And at what level of traffic will you feel comfortable to start raising tolls? Pedro Agustín Losada Hernández: Thank you, Begoña. Well, we are monitoring continuously the traffic evolution. And also, well, going to your question in October, we see more or less the same trend as we have seen in September, and we have shown these numbers in the presentation. In terms of raising tolls, I want to remind that we are still in a pandemic situation with restrictions. And as Ernesto mentioned before, employers that are not deciding whether they are going to ask employees to go back to offices yet. So until those things happens, I think it's too premature to talk about the toll strategy. Thank you. Begoña Morenés: Thank you, Pedro. Also from Patrick. Patrick Creuset: At what level of net cash position ex infrastructure, do you feel you need to keep on a sustainable basis? Ernesto Lopez Mozo: Okay. Well, really, we have plenty of lines. We have the possibility of issue European commercial paper. But I would say none. But if you want, you can look at about, I don't know, several hundred, €200 million to €500 million of liquidity in terms of just pure operations. But as I mentioned, and nowadays, is there such liquidity in the European commercial paper market or you have lines, you don't really have to hold to the cash, but you could use cash, give or take, that kind of liquidity for operations, I think, is reasonable for our size. But very important, remember that you could do that having a net debt position, okay? So it's not that you have to have a net cash position of that. I mean for liquidity purposes, you could be in a net debt position close to 2x net debt-to-EBITDA and still have that buffer of liquidity, right. So let's not mix both things. Begoña Morenés: Thank you, Ernesto. Last question from Patrick. Patrick Creuset: As you execute your Horizon 24 strategy with divestments and ramp-up of new projects. At what point can we expect a more structured dividend or shareholder return policy? Ernesto Lopez Mozo: Well, in the end, we don't have a policy on purpose to retain flexibility. But we are aware that dividends a long time should reflect the cash generation in terms of dividends or free monitor shareholders from our infrastructure, right. So in the past, you've seen that we have had some sort of steady dividend, slightly increasing. Of course, with the pandemic, we lowered that down a little bit. And it was reflected not a specific year, but the overall expected performance of the business plan. As I said, we don't want to have a policy that could put kind of restriction on us when we could see opportunities. But a long time, you see all that free cash flow from our infrastructure moving to shareholders. Begoña Morenés: Thank you, Ernesto. The next set of questions come from Nicolo Pessina from Mediobanca. Nicolo Pessina: First question, 407ETR, should we expect more dividends based on the performance that it has had for the fourth quarter? Pedro Agustín Losada Hernández: Thanks, Nicolo. Well, we -- first of all, I'm really happy that we are back with the dividends with this 300 distribution. I guess -- sorry, you need to bear with us on this till the end of the year, it's a little bit soon because the main reason that I mentioned before was about the raising tolls. We need to keep on looking at the evolution of the traffic. It's true that we have a very healthy cash position, very healthy liquidity position. And things are going much better than before. All the stakeholders has been okay with this distribution, not only the Board and other stakeholders like the rating agencies. And so we will keep on working in that effort, again, is perhaps too soon to answer that question, hopefully, in a couple of months we will clear that out. Thanks. Begoña Morenés: Thank you, Pedro. Also from Nicolo. Nicolo Pessina: Should we expect an improvement of the 2021 final dividend to Ferrovial shareholders compared to last year? Ernesto Lopez Mozo: Well, if we are able to deliver on the additional €200 million, the Board approved from share buybacks, definitely. Yes. I mentioned about delivery because there's not that much liquidity in the stock, and there's not that many days of trading before year-end. But I mean, all in all, yes, we should end up with a higher remuneration than in 2020. Begoña Morenés: Thank you, Ernesto. And the last question from Nicolo. Nicolo Pessina: On IRB infrastructure, do you plan all your businesses in India -- or your business in India, apologies to go through IRB or would you consider bidding for some of the projects by yourself? Pedro Agustín Losada Hernández: Thanks, Begoña. Well, the idea definitely is go through the IRB for any investment in that we are new in that market. We think that these are unique opportunity, learning from one of the leaders in that market is not the idea to be it by ourselves in a new market where we have still a lot of things to learn. So I hope that answers your question. Begoña Morenés: Thank you, Pedro. The next set of questions come from Luis Prieto from Kepler Cheuvreux. Luis Prieto: First question, how should we think about energy, mobility and water investments in terms of amounts and actual segments of interest? Ernesto Lopez Mozo: Okay. Well, more than amounts that is not, let's say, an important amount of capital allocation that we have provided here. In terms of energy, we are doing, as you've seen some stuff for self-consumption in photovoltaic. I will be doing other opportunities where we could have some differential capabilities, right. So probably, the value is going to be more on the buildup to get in that. And as I said, with some sort of engineering or EPC advantage with the idea of then rotating pretty quickly. So they shouldn't be that capital-intensive, and we'll try to take advantage of where we can add more value in the value chain. I mean in a kind of concession that is not complex is in the initial value where we bring our capabilities and then we should be rotating. Mobility, you've seen what we've done in the past with CD -- Wondo, we are looking at different things and how they could affect the performance of mobility around cities, but not looking to deploy a lot of capital. So we have seats in different areas, even some venture capital to see opportunities where we could basically get know-how for other businesses. Water. I mean it's an important value chain. And here, we haven't looked at a lot of capital allocation, exploring opportunities where we could have an extra return so far we haven't found. So it's businesses where you look for edges in terms of capabilities that are a little bit differential. Probably of these, the ones that could have more allocation and also nurture other divisions could be energy in these different aspects, but we haven't committed yet any capital allocation for our business plan. I mean this will keep evolving. In the fall, we will have more discussion here. We have a new CEO, and we will be looking into this. But it doesn't change the Horizon 24 slide that we should always have in mind. If we change that, we will be telling you. Begoña Morenés: Thank you, Ernesto. The next question also from Luis. Luis Prieto: In the case of Lilium, what should be your overall capital commitment? Ignacio Gaston: Thank you, Luis. Thank you, Begoña. This is Ignacio Gaston again. With respect to Lilium, the equity exposure that we have is not material at this stage, it's less than 1% of the company listed in NASDAQ. Luis, thank you. Luis Prieto: Thank you, Ignacio. Could you please provide an update on the disposal processes for international services operations, Amey, U.S., Canada and Chile? Ernesto Lopez Mozo: Well, Amey is advancing, and we are looking probably to arrange to sign an SPA before the end of the first quarter next year. U.S., oil and gas is small, but advancing well. Canada, that is infrastructure maintenance in Canada and the U.S., we mentioned that it goes into construction. It has synergies, it's complementary, it has resources at a time when there could be a lot of activity. And Chile has been postponed to next year just to sell it after the elections right now is kind of on a mood where transactions are much more limited, so we'll wait till next year. Begoña Morenés: Apologies. I was on mute there. Last question from Luis. Luis Prieto: Does your potential entry into the Indian market derived from a more contained market outlook for high-complexity assets in North America? Pedro Agustín Losada Hernández: I guess I'll take this one. No, no, not all. I think that we have been clear during the presentation. So Ernesto, in his words, remain focus is still on high-complexity projects, and particularly in North America. We think that the pipeline is getting better. We have been prequalifying several projects in North America. We feel positive to see new managed lanes in the coming future. And thus, the main goal of the company has been set in any [indiscernible] including the Horizon 24. So I think that the short answer is no. Begoña Morenés: Thank you, Pedro. The next set of questions come from Robert Crimes from Insight. Robert Crimes: First question, what level do you see the IRRs or new build toll roads in India to be built by IRB? Pedro Agustín Losada Hernández: Thank you, Robert. Well, that depends on the type of project. As we in [indiscernible], sometimes goes for projects with traffic risk demand or with type of availability payment with less risk. And in this case, it's spread in three types of projects, the [indiscernible]. That means availability projects, demand risk projects and sometimes involved in privatizations of existing assets from the administration. I guess just to give you a sense that, that should be depending on the asset in the mid- to high 10s, again, depending on the asset class. Robert Crimes: Thank you, Pedro. Second question, what level did you estimate the EV/EBITDA multiple paid for IRB? Ernesto Lopez Mozo: I don't know, Pedro, do you want to me to take this one? Do you take it? Pedro Agustín Losada Hernández: Sure. Yes, whatever you want it. Yes. Ernesto Lopez Mozo: Okay. Well, no, I mean, in terms of EV/EBITDA, our analysis was not based at all on EV/EBITDA. We had different equity discount rates for the different projects and type of risk. In construction, we only consider the margins for the next 4 -- 5 years, and we didn't have any terminal value for construction, and we didn't put any value for new businesses that we could win. And believe me, the value creation opportunity lies there in all what's coming to the market, in particular, in the region of traffic risk, where there's less public money involved and where there are few companies that have the credentials and the capital strength to bid for those. But as I said, no value was put in there. We just had discounted cash flow of the concessions and of the construction business. Begoña Morenés: Thank you, Ernesto. Last question from Robert. Robert Crimes: Is IRB's BOT division, pure construction, it had 31% EBITDA margins last year. Pedro Agustín Losada Hernández: Yes. Thank you, Robert. Well, BOT, as I tried to explain before, it's one of these asset class with demand risk. The construction -- the construction division, it's the one that is -- the EPC division is the one that is pretty much devoted on -- they own projects. So they own toll roads. And that division has demonstrated historical margins in the area of 25%, 30%. Begoña Morenés: Thank you, Pedro. The next set of questions come from Marcin Wojtal from Bank of America. Marcin Wojtal: First question, are you open to allocate capital to emerging markets other than to India? Ernesto Lopez Mozo: Marcin, thanks for the question. Well, we've looked at investments in Chile and Colombia, if you may call them emerging markets, yes, but really, the kind of total tickets consider is not much beyond what we have already done, right. So we remain again in Horizon 24 slide, where, yes, we look at these geographies, but it's not that we're looking to deploy much more than what we were doing at the moment, right. So the reason also for -- because it's a great opportunity and also the things we were looking in Latin America are less appealing. Begoña Morenés: Thank you, Ernesto. And lastly, from Marcin. Marcin Wojtal: Could energy infrastructure assets, such as transmission lines, become an important part of Ferrovial's capital allocation strategy? Ernesto Lopez Mozo: Well, as I said before, it's difficult to see transmission lines as an important part of the capital allocation strategy because of what I mentioned before, where we differentiate ourselves on the value chain is at the beginning where you have all the engineering, DPC, and then you can rotate, right. So transmission lines always call for quick rotation on our side. So it's very difficult to say at one point in time a lot of capital allocated or seating on that part. Begoña Morenés: Thank you, Ernesto. The next set of questions come from Fernando Lafuente from Alantra. Fernando Lafuente: First question, construction has maintained similar margin levels as in the second quarter of the year. In Q2, there were positive one-offs. Are there any positive one-offs in Q3? Is it the contribution from maintenance services in the U.S.? Iñaki García Bilbao: Thank you, Fernando. This is Iñaki from Ferrovial Construction. Yes, you're right. I mean, in Q3, there is a one-off that is mentioned in the presentation that is the sale of the assets of the aggregates of SCC business in the U.S. and the surplus of selling these assets was around €13 million. Regarding the contribution of maintenance services, I mean, it's also shown €130 million, I mean, with €9 million EBIT. I mean so this is not moving the needle in the contribution of the EBIT margin of 2.4%. Thank you. Begoña Morenés: Thank you, Iñaki. Also from Fernando. Fernando Lafuente: On the 407ETR, what were the main KPIs that led the Board to approve the dividend for the fourth quarter of the year, what should we assume for 2022, is it back to normal dividend payments? Pedro Agustín Losada Hernández: Thank you, Begoña. Well, I think more or less, I answered this question before. I mean the number of KPIs is normal. And because we do consider everything, not only the traffic evolution, the projection, definitely, the COVID situation. But again, I want to stress this that we are still under some restrictions as well as the -- how comfortable is the Board when it takes this decision as well as rating agencies that is also a very important stakeholder. So now I guess, as I mentioned before, it's too early to understand where are we going to end up during this of dividend. So even more complicated to answer how it's going to '22 look like in terms of dividend coming from the 407. Begoña Morenés: Thank you, Pedro. Lastly from Fernando. Fernando Lafuente: Regarding the sale of the Services division, what are the cash-ins expected in Q4? And what will be delayed into 2022? Ernesto Lopez Mozo: Well, in 2021, we should be getting something like €1 billion, the rest should come up in 2022. Begoña Morenés: Thank you, Ernesto. The next set of questions come from Filipe Leite from CaixaBank BPI. Filipe Leite: First question, what was the impact from the sale of aggregate recycling activity in 3Q EBITDA and EBIT of the Webber division? Iñaki García Bilbao: Thank you, Filipe. I think I answered this question. I mean, the surplus on selling these assets was 30 million, and if you exclude this Webber division will be in the 2.4% margin -- EBIT margin in -- for the year. Thank you. Begoña Morenés: Thank you, Iñaki. Also from Filipe. Filipe Leite: on the 407ETR, should we anticipate some marginal tariff increase in 2022? Or should we assume no tariff changes until traffic recovery to pre-COVID-19 levels? Pedro Agustín Losada Hernández: Yes. Thank you, again. Sorry, I don't want to repeat myself with the same answer on -- we're still under COVID. We -- it's not a matter of whether we recover the 2019 levels in order to understand where we are going to back on the dividends levels, back on the recent toll scheme, we need to keep an eye on the many things that are evolving. Ernesto also mentioned before, the situation of the employers and how will that affect the traffic. So we need to wait and see a little bit more. Sorry about that. Begoña Morenés: Thank you, Pedro. The next set of questions come from Tobias Woerner from Stifel. Tobias Woerner: First question, how do we have to see the €253 million cash position in the services business, is this yours, or does part of it go with the divestment? Ernesto Lopez Mozo: Well, I would say, it's ours, right. I mean if it goes where the divestment, they have to pay for that, right. So when we have, let's say, holding value of our assets in our books is taking into account the equity, the cash if it has to go with the business, it has to be paid, right. So we could consider it 8 hours. Begoña Morenés: Thank you, Ernesto. Also from Tobias. Tobias Woerner: Regarding the I-66, can you give us a few parameters for the implied DCF valuation? What sort of ramp-up assumptions should we take? Pedro Agustín Losada Hernández: Okay. Well, as you mentioned, a few parameters could be -- to be consistent on the high-congestion levels of the area as well as the GDP per capita is one of the highest in the U.S. and the tariffs in the area around the existing ones are also high in terms of tolls. So the users are used to these express lanes and toll lanes, and that's why probably for modeling purposes, we believe that the ramp-up could be shortened because there are existing assets, we think, are not profiled. So I hope that helps. Begoña Morenés: Thank you, Pedro. Lastly from Tobias. Tobias Woerner: Your IRB investment comes without control. How do you protect your capital, will you get any Board seats, what will your influence be or are you simply a financial investor? Pedro Agustín Losada Hernández: Okay. Thank you, Tobias. Yes, we don't have control. We are a minority shareholder, with less than 25%, but still almost 25% that give us the opportunity to have two seats on the Board, and that means 25% of Board of the Directors. We -- in conversations with the company, also brings technical capability and experience in many areas, including ESG, health and safety, billing, technical and finance. It's true that we are -- we don't have the control. But with those things, again, two Board seats and a 25% stake, I think that we are relevant actually to this company. Begoña Morenés: Thank you, Pedro. The next set of questions come from Nabil Ahmed from Barclays. Nabil Ahmed: First question, regarding the dividend distribution of 407ETR, are there any political constraints on paying dividends? Pedro Agustín Losada Hernández: Short answer is no. There is no political constraints. Begoña Morenés: Thank you, Pedro. Second question from Nabil. Nabil Ahmed: Could you please elaborate on the genesis of the IRB transaction, are there any previous relationship with IRB or was it a competitive process? Pedro Agustín Losada Hernández: It was not a competitive process. The interest of -- has been for several years, as we keep an eye on several markets, including the Indian one. In fact, in 2008, we made it try with a local partner for bidding opportunities in the road space. However, we -- after getting a better understanding of the market, we concluded that the complexity assay of the market was not the right moment to enter. Now we came cross on IRB as one of the leading players in toll roads and the rest of the positive and skills that we have mentioned during the presentation, and IRB were looking for partners and trying to capital raising. With our current approach and with focus on growth to this platform in such a very attractive infrastructure market with a huge pipeline in front of us. We don't foresee any potential conflict that we decided to go across. Begoña Morenés: Thank you, Pedro. And lastly, from Nabil. Nabil Ahmed: How do you manage potential conflicts of interest related to an opportunity in India, can Ferrovial go alone on an investment opportunity and competes with IRB or does IRB have a right of first refusal on any Indian project? Pedro Agustín Losada Hernández: Thank you, Begoña. Well, there's no restrictions on whether Ferrovial can go, I think, is set out. But as I mentioned before, definitely it's not the idea, and we are just stepping almost in still approvals from regulators and more importantly, from the company. So we are not in yet, but it's going to be a very first step in the Indian market. So we want to be prudent. And I don't see that conflict coming in probably ever, but definitely not soon. We would like to learn from them, and as one of the leading players and take advantage of the growth that we see in this market. No, the idea is not to compete and enter into any conflict of interest. Begoña Morenés: Thank you, Pedro. The next set of questions come from José Manuel Arroyas from Banco Santander. Jose Manuel Arroyas: First question, in the third quarter of 2021, the 407ETR, so average travel distances rise by 7% year-on-year to 23.8 kilometers. Is this attributable to a mix effect associated with higher share of heavy vehicle traffic and if so, are longer travel distance is sustainable going forward? Pedro Agustín Losada Hernández: Great. Thank you, José Manuel, basically, it is attributable for more mid-day and weekend traffic. So as soon as we get more in A.M. peak, probably we will recover the normal level. So I guess that is not sustainable. Again, if we recover that strategy in that part of the day. Begoña Morenés: Thank you, Pedro, also from José Manuel. Jose Manuel Arroyas: The current government of Ontario is considering building Highway 413 again. Can they legally build this road if the Canadian federal government announces an unfavorable environmental assessment? Pedro Agustín Losada Hernández: Our understanding is that if they got an unfavorable environmental assessment, they cannot build up I presume that probably is not going to be legal that's why they need to go through this federal environmental assessments all the way. They will decide in second time period that could last even 2 years where they need to change the project or they need to follow with it or potentially cancel. But if that happens, the last one, we don't believe that they can give a follow-on. Nothing has changed, actually, even the latest news from the governor because it's the same one that was pushing towards these projects or nothing has changed over the last few months since the most important thing from our perspective is that now that environmental assessment is under further care. Begoña Morenés: Thank you. Pedro. The next question comes from Nicolas Mora from Morgan Stanley. Nicolas Mora: Can you provide an update on the traffic of U.S. managed lanes into October after a lackluster third quarter? Pedro Agustín Losada Hernández: Sorry. As explained in the presentation, traffic in the U.S. managed lanes was affected in Q3 by the surge in COVID cases that in some places was up, not as winter surge. We are seeing traffic levels picking up in October again as COVID situation has got under control. Begoña Morenés: Thank you, Pedro. The last set of questions come from Charles Maynadier from Kempen. Charles Maynadier: First question, would you consider increasing your stake in IRB in the medium term? Pedro Agustín Losada Hernández: Thanks, Charles. Well, the quick answer is no. We, as I mentioned several times in this call, we need to learn a lot. We are happy with our stake and Board presence in the company. We think that we can add a lot of value. And as I said, take advantage of the growth that we are almost sure that is coming. So we presently don't have any plans to acquire stake -- or increasing the stake in the company. If we have any decision for acquisition or control stake the company in the future, we will comply with all applicable laws and make all relevant disclosures, but it's nothing that we are thinking today. Begoña Morenés: Thank you, Pedro. And lastly, from Charles. Charles Maynadier: Do you see any significant impact from raising cost of materials and labor shortages in the construction activity in the coming quarters? Iñaki García Bilbao: Thank you, Charles. Yes, I mean it's becoming to be a big concern, I mean, in the sector. Also, most of our external close are -- external costs are closed with contractors. Also, I mean, there are mitigants with formulas in some of the geographies that we are in the section formulas, I mean in Spain, in Poland. But it's true, I mean that this is going to have an impact and also had an impact in this quarter. We are confident, I mean, that governments are beginning to be completely aware of the problems. So probably some measures, transitional measures. I mean, like in Spain, I mean, after the indexation formulas will help. But also, I mean, we will be prudent in our bidding offers. I mean presenting offers and considering, I mean, these new prices in the bidding process. Thank you. Begoña Morenés: Thank you, Iñaki. There are no further questions. Ernesto Lopez Mozo: Okay. So thanks for bearing with us. And yes, I have to make three announcements. Two of them are of colleagues leaving. I mean, the first one is Fernando González de Canales, the CFO of Ferrovial Services goes with the environmental business that we are selling. He's a real star. It's been a pleasure and an honor working with you, Fernando. We will miss you a lot, but we're in the same city, I guess. Now maybe learning some German. We expect to see you -- expect to see you a lot. And thanks a lot. Thank you. Fernando González de Canales Moyano: Thank you, Ernesto. Ernesto Lopez Mozo: Also another great star Begoña is leaving. She's going to Head the Investor Relations Department of Banco Santander. We'll miss her a lot. She's fantastic and congratulations to Santander. We'll miss her a lot. We have another great star coming up and that's Silvia Ruiz to replace Begoña. Silvia has been controller of Cintra. She knows all the assets inside out and she's met some of you investors in the past. So a lot of movement, a lot to thank, and a lot to welcome. And thanks all of you investors for bearing with us. Take care.