Net attributable income was negative as a result of the 112.3 million euro of net losses booked at FCC Energy due to regulatory changes plus 158.9 million euro in value adjustments on renewable energy assets.

Writedowns at Alpine, the construction subsidiary in Central and Eastern Europe, led to negative EBITDA in the amount of 140.4 million euro. Combined with falling business volume in the Construction and Cement divisions in Spain, the result was negative Group EBITDA of -34 million euro, contrasting with 236 million euro in the first quarter of 2012.

In a quarter marked by a sharp reduction in economic activity in general, and in construction in particular, the backlog expanded by a notable 3.4% to 34.716 billion euro. This positive performance was driven mainly by new contracts at Aqualia, the water management subsidiary. As a result, Environmental Services and Water account for 74.4% of the total backlog (26.324 billion euro), while Construction represents the other 25.6%. The 34.716 billion euro backlog represents three-and-a-half years' revenues for the Group.

Revenues amounted to 1.984 billion euro in the first quarter of 2013, down 18.5% year-on-year. That decline is due fundamentally to the process of strategic and market reorganisation that commenced at Alpine in 2012, together with the effects of lower government investment in infrastructure in Spain. Revenues in Spain declined by 17.4% to 931.7 million euro, while international revenues fell by 19.5%.

At 30 March 2013, net interest-bearing debt amounted to 7.254 billion euro, having increased by 166 million euro (+2.3%) with respect to the end of 2012. The main component of this change is the decline in operating profit, particularly at Alpine, together with the seasonal increase in working capital in the Construction area (+153 million euro). Both factors were mitigated by the 150 million euro reduction in bank debt agreed at the end of March as part of Alpine's financial restructuring process.

Milestones in the quarter

Aqualia lands contracts worth over 1.1 billion euro. Aqualia, FCC's water management subsidiary, obtained contracts worth over 1.1 billion euro in the first quarter. One of the most notable is a 25-year contract from the city of Jerez de la Frontera (Cádiz), which is worth close to 900 million euro. The company also added and extended contracts, with a combined value of over 200 million euro, in Madrid, Ávila, Oviedo, Girona, Cantabria, León, Vizcaya, Guipúzcoa, Pontevedra and elsewhere.

FCC enters Peru with contracts worth close to 200 million euro. FCC, the Citizen Services group, obtained its first two contracts in Peru: construction at Callao Port, in Lima (worth approximately 165 million euro), and upgrading the Trujillo sports complex (32 million euro). Callao Port is the largest in the country and one of South America's largest Pacific ports.

Asset swap and sale in Cement. In February, Cementos Portland Valderrivas (CPV) reached an agreement to swap its 98.75% stake in Cementos Lemona for CRH's 26.38% stake in Corporación Uniland. As a result, CPV now owns 100% of Corporación Uniland. CRH also acquired CPV's cement terminal in Ipswich (UK) for 22.1 million euro.

Refinancing bank debt at Alpine. At the end of March, Alpine signed a 2-year deal with more than 50 banks to refinance all of its bank debt. The agreement, which includes a haircut of 150 million euro, evidences the banks' support for Alpine's business plan.
 

KEY FIGURES (million euro)  

	1Q 2013	1Q 2012	Change (%)
Net sales	1,984.1	2,435.5	‐18.5%
EBITDA	(34.0)	236.9	‐114.4%
Income attributable to equity holders of the parent company	(140.2)	16.6	N/A
Total interest-bearing debt	7,254.2	7,087.7	+2.3%
Backlog	34,715.9	33,576	+3.4%

 

The Cabinet underlined FCC's activities in waste management, water, cement and construction and its ongoing efforts to reduce CO2 emissions in its industrial processes, together with Group-wide policy to respect the environment.
 

This new system will enable users to receive details, in Spanish and English, about the bus service and tourist information on their phones, and also provides free Wi-Fi and e-ink bus schedule displays. “With Smart Madrid, Spain's capital advances further as a leading intelligent city", said Botella.

The city government plans to integrate near field communication (NFC) technology, which allows for data transfer between devices in close proximity; QR codes, capable of storing data that can be easily read on mobile devices; free Wi-Fi; and e-ink displays at 500 bus shelters and bus stop poles (i.e. approximately 10% of the 4,205 shelters and 1,200 poles that CEMUSA manages in Madrid).

As part of the pilot test, CEMUSA will also install free Wi-Fi at 10 bus shelters with automatic handover to the buses; combined with the service already provided on EMT buses, this will allow users to maintain an internet connection when boarding or alighting.

CEMUSA promotes the development and application of technological and innovative solutions through Cemusa Tec. Since its creation in May 2011, the brand has focused on improving urban furniture efficiency, adapting existing infrastructure, and creating novel furniture and applications that meet the needs of new approaches to intelligent sustainable cities.
It has also driven growth in advertising on urban furniture and points of sale due to the added value that interactive digital solutions offer advertisers: flexibility, immediate updating of content, and a greater visual impact of messages.
 

The goal is to promote, among FCC stakeholders, an enriching and inclusive vision of people with disabilities and to actively encourage their integration into society, especially in terms of professional development, as well as improving their participation in daily life and their family situations.

Activities included a photography exhibition at the new corporate headquarters in Las Tablas and in the Federico Salmón offices, both in Madrid, as well as a discussion about difficulties in integrating people with disabilities and potential solutions, which included participation by representatives from the ONCE Foundation and FCC's Human Resources and Corporate Responsibility areas.

The week culminated with a screening of the short film, "The Butterfly Circus", a realistic human story of optimism that is about overcoming obstacles. Directed by Joshua Weigel, the film was the Grand Prize winner of The Doorpost Film Project in 2009, which promotes projects that raise awareness about human values.

A book presentation was held at the Nuestra Casa Retirement Home, which is funded by the Esther Koplowitz Foundation. "Hasta el cielo, ida y vuelta" (To heaven and back) tells its story through letters between a girl and her grandmother, addressing topics such as Alzheimer's disease, love, and life. On Friday the 26th, the ONCE Foundation's "La Luciérnaga" dance troupe performed at the retirement home.

These events were organised by FCC's Corporate Responsibility and Human Resources areas, which maintain strong commitments to these issues through company-wide implementation of their Equality and Diversity Policy and the 3rd Corporate Responsibility Master Plan.

FCC also works closely with organisations such as the Adecco Foundation, ONCE Foundation, and the Red Cross, as well as with public institutions, such as Spain's Ministry of Health and Equality. FCC maintains and promotes cooperation agreements with these organisations, and also participates in work programmes focused on labour market integration of people with disabilities and of groups at risk of social exclusion.

FCC's construction subsidiary is building 9 of the 49 reinforced concrete caissons which will serve as the foundation of Açu Port. The company chose Algeciras as the site to build the first components because of its draught, since the Açu facilities are not yet prepared to moor the caisson production vessels.

The caissons are 45 metres long, 24 wide and 18 high. Caisson loading requires an extremely high-precision manoeuvre given their size and the scant space between them (approximately 4 metres). They can only be moved with tugboats, with the result that any unfavourable sea and wind conditions could complicate the placement of caissons on deck.

The caissons will be loaded onto a Black Marlin semi-submersible vessel measuring 217.50 metres long (equivalent to two football pitches) with a beam of 42 metres. The five caissons will be transferred from the dock to the vessel using two tugboats and two support boats.

The Black Marlin will partially submerge to a depth of around 12 metres during the loading process and, once complete, it will broach the surface again. The caissons will then be secured to the deck using steel plates to impede movement during the journey.

The journey
The vessel will take 15 days to cover the 4,300 nautical miles (7,960 kilometres) between Algeciras and Río de Janeiro (Brazil). After passing through customs in Río, the caissons will be towed to São João da Barra and sunk in Açu Port to form the temporary breakwater behind which the Mar del Aneto and Mar del Enol caisson production vessels will be moored.

The 4 remaining caissons (of 9 in total) will be completed by mid-May and transported at the end of that month in a second journey along with the Mar del Aneto caisson production vessels. Construction of the caissons in Algeciras Port has generated more than 700 direct and indirect jobs.

Açu Port, the third-largest in the world
FCC heads the consortium that will complete this complex civil engineering project. The project includes the construction of a 2,438 linear metre dock to be executed by manufacturing 49 reinforced concrete caissons and a 600-metre dike. The contract also includes dredging more than 4.1 million cubic metres to attain an average depth of 31 metres, the dike superstructure works, and the provision of nautical equipment and buoys.

The port is located inside the Açu Superport industrial complex, which spans 90 square kilometres (2.5 times the size of Manhattan), and will comprise 2 terminals with 17 kilometres of pier and 40 berths, capable of receiving ships of up to 400,000 tonnes. As a result of this project, Açu will be the third-largest port in the world and the largest in the Americas, with an annual capacity of 350 million tonnes.

Experience in port construction
FCC has extensive experience in complex port projects, including the floating pier at La Condamine Port (Monaco). For the first time in engineering history, a pier was built in its entirety in a dry dock, in Algeciras Bay, and was floated to Monaco, where it was anchored and connected to land. There are 816 nautical miles (1,500 kilometres) separating Algeciras and Monaco, equivalent to a 12-day journey. FCC is currently building the chemical products terminal in Tarragona Port and the new container terminal in Cádiz Port, which will be completed in 2015.

FCC, the Citizen Services Company, has signed a contract to modernise Callao Port in Lima, the largest in Peru and one of South America's largest Pacific ports, for around 206.3 million dollars (around 165 million euro). The Callao contract is part of a very ambitious investment plan amounting to 1 billion dollars through 2020. The project will affect piers 5 and 11, which will measure 560 metres and 280 metres, respectively.

The contract, which is worth close to 900 million euro, includes additional investments of more than 1 million euro per year to optimise the networks and installations.

The contract includes managing 704 kilometres of sewage network and 870 kilometres of water supply pipeline by which 16.3 million cubic metres of drinking water are supplied each year. Jerez also has 7 drinking water reservoirs with a storage capacity of 34,300 cubic metres. Aqualia will bill directly to more than 470,000 customers.

Jerez has a wastewater treatment plant (Guadalete) and another 23 smaller treatment facilities throughout the municipality; until now, Aqualia had managed them under a sub-contract from the city-owned company Ajemsa. Once the contract is signed and the commencement date is set, Aqualia will directly manage water treatment and supply as well as the sewage system.

The company also obtained other contracts in the last few days worth more then 200 million euro: operation and maintenance of the La Reguera treatment plant in Madrid (4 years); management of the Aramo treatment plant in Oviedo (33 years); and the provision of water supply and treatment and sewage services in Candeleda, Ávila (30 years). Additionally, the Aigües de Girona PPP extended its cooperation agreement with Aqualia, which also owns a stake in the partnership; and the local governments in Bezana (Cantabria) and La Bañeza (León) have both extended Aqualia's contract by another 10 years.

As a result of its new contract, Aqualia will provide services to Jerez de la Frontera (population 212,454), strengthening its position as the leading water operator in Andalusia, where it serves 100 municipalities and 2.4 million people.

As a result of expanding, both in Spain and internationally, revenues increased by 2.5% in 2012, driven especially by double-digit growth overseas. Aqualia has also boosted efficiency, which increased operating profit by 6%, improved its competitiveness and raised the backlog to a historic 13.6 billion euro.

Aqualia, which uses cutting-edge technology, has over 7,000 employees working in 1,100 municipalities scattered over 17 countries: Spain, Italy, Portugal, Czech Republic, Poland, Romania, Montenegro, Mexico, Ecuador, Peru, Colombia, Chile, Algeria, Egypt, UAE, Saudi Arabia and China.
 

The Callao contract is part of a very ambitious investment plan amounting to 1 billion dollars through 2020. The project will affect piers 5 and 11, which will measure 560 metres and 280 metres, respectively.
Pier 5 is used for containers and bulk ore, while pier 11 provides port services for food imports and has cement silos with a storage capacity of 25,000 tonnes.

FCC has 23 months to complete the work on this phase of the port, which handles more than 1.9 million containers annually. The client, APM Terminals, a Maersk Group company, is the world's fourth-largest port operator.

Work on the port will modernise infrastructure and equipment to adapt to current cargo transport demand as well as ship sizes and draughts. The company will also outfit the port with better equipment to respond to the types of cargo that will be handled.

As regards the contract to upgrade the Trujillo sports complex (also known as Chicago sports complex), the company will build an athletics stadium, an indoor arena, and supplementary infrastructure in preparation for the 2013 Bolivarian Games, an international multi-sport event held every four years between Bolivarian countries (Bolivia, Colombia, Ecuador, Panama, Peru and Venezuela). Other countries that will participate in this year's games are Chile, Spain, Mexico, Argentina, Guatemala and Paraguay.

The centerpiece of the new installations (total area: 23,587 m2) will be a 5,505-seat athletics stadium. It will include a 400-metre track with a central enclosed area with natural grass, 2 long and triple jump runways measuring 61 metres with a sand box on each side, 2 pole vaulting runways, 2 high jump areas, 2 javelin throw runways, 2 discus throwing platforms, and 2 hammer throwing platforms. Below the grandstand, the company will build a warm-up track, men's and women's locker rooms and sauna, and a gym. The facility will also include a centre providing the following treatments: hydrotherapy, cardiovascular, paraffin, electro-medicine, and ultrasound.

The complex will also have a covered arena (almost 4,000 m2) with capacity for 2,514 spectators. It will be used for multi-sport and martial arts events. The sports complex (6,466 m2) will have four courts (for basketball and volleyball) and telescopic stadiums seating for 2,688 people. The artistic and rhythmic gymnastics portion of the Bolivarian games will be held there.
The new facilities will have a car park with 235 spaces, a promenade with central gardens connecting the arena and the sports complex, and a three-storey general services building.

FCC's experience in port construction

FCC has extensive experience in the construction of complex ports, such as the Condamine port's floating pier in Monaco. The company also built Port Olímpic, in Barcelona; Igoumenitsa Port in Greece; and the bulk solids terminal in the Port of Castellón.

It recently expanded El Musel port, in Gijón; refurbished the southern dock of the Port of Castellón; and built new locks at the Ports of Seville and Vienna.

In 2011, FCC was awarded the contract for the new container terminal in the Port of Cádiz. The project will be completed in 2015. At the end of 2012, FCC was awarded a 407.2 million euro contract to expand the Açu Superport, in Brazil, the third-largest in the world and the largest in the Americas. The execution period is 32 months.

A strong presence in Latin America

FCC, the Citizen Services Group, has contracts in Latin America worth over 2.5 billion euro. These two new contracts in Peru strengthen its leadership on the continent, a strategic area in the company's globalisation process. Other important projects currently under way in the region include the construction of Line 1 of Panama Metro, a hospital complex in Panama City, a new access channel from the Pacific to the Panama Canal, and the Mina de Cobre road.

In Costa Rica, the company is expanding the Cañas-Liberia national highway in Guanacaste and holds the concession (through Globalvía) to operate the San José-Caldera toll road. At the end of the year, FCC obtained a contract to build the control tower at Colombia's El Dorado airport, which ranks first in Latin America in terms of cargo volume and third in passenger traffic.
 

The Plan also includes objectives such as operating efficiency, with costs adapted to the current market situation, and a debt and capital structure in line with cash flow from businesses, with an international footprint that is confined to more profitable areas and activities. This will result in greater cash flow and lower leverage, enabling the company to capitalize on growth opportunities.

Five strategic initiatives will help reduce debt and improve profitability:

1) Divesting non-core assets amounting to 2.2 billion euro.
2) Restructuring the Construction business, which includes adjusting production capacity in Spain and rolling back Alpine to focus on domestic markets, as well as boosting its efficiency. As regards other international activity, the focus will be on projects and areas with the greatest potential demand.
3) Adapting Cement capacity to the market situation.
4) Strengthening the leading position of Services in Spain and Central Europe (through subsidiary .A.S.A.) and a shift in the UK to waste management. The plan also includes increasing Aqualia's market share in the end-to-end water business in Spain, and expanding internationally.
5) Reducing structural costs in all areas, both at the parent company and in the divisions.

Operating and financial strength
These initiatives will ensure the group's operating and financial sustainability. The Strategic Plan assumes a restrictive economic scenario in terms of both activity and funding. Nevertheless, by 2015 FCC will attain 1.2 billion euro in recurring EBITDA, an annual cash flow of 850 million euro, and debt of 5.2 billion euro (i.e. 2.7 billion euro less that at 2012 year-end). The decline in debt will be achieved through the divestment programme (2.2 billion euro) and higher cash flow.

Another pillar of the financial strategy is "adjusted capex". Capital expenditure will amount to 1.4 billion euro (i.e. less than depreciation and amortisation, which will total around 1.6 billion euro). That figure includes 350 million euro in growth capex focused on the international water and environment businesses, mainly in the UK. Growth will be sustained by businesses that are not capital intensive.

Infrastructure and Services strategic businesses

The objective in the Construction division is to restructure the business by adjusting capacity in Spain, focusing Alpine on its home markets (basically Austria, Germany, Switzerland, the Czech Republic and Slovakia) and promoting international activity in areas and projects where FCC has competitive advantages.

In Spain, the adjustment of capacity will mean downsizing to adapt the headcount to the current market situation. The bulk of this adjustment will take place in 2013 in order that its impact is reflected in the P&L as soon as possible in the form of higher operating margins.

Alpine is a separate item within the international Construction area. The future of FCC's central European subsidiary involves redeployment to its home markets and improving business efficiency by better project selection, downsizing and divestment of non-strategic assets. Elsewhere, the goal will be to increase profitability, focused on specific areas, primarily in Latin America, the US, and MENA (Middle East and North Africa), as well as expanding the industrial activity in some Latin American countries.

In Services, the Strategic Plan calls for strengthening FCC's lead in Spain and repositioning itself in the UK, as well as promoting leadership and international expansion by water management subsidiary Aqualia. In the environmental area in Spain, efficiency improvements will be pursued through exhaustive cost controls and capital expenditure will be curtailed. Aqualia will work to increase its market share to 30% in Spain and expand abroad with its proprietary technology in end-to-end water management.

The UK environmental services business will be repositioned by expanding waste management services while tailoring landfill capacity to current demand. The industrial waste area will seek to recover business volume and profitability by exporting proprietary technology to high-potential markets such as MENA, and increasing specialization in growth niches such as hazardous waste, oil industry waste and chemical waste.
 

(1) Includes €30mn in parent company expenses
(2) Activity cash flow = Operating cash flow + Investing cash flow
(3) Refers to cash flow from recurring activities
 

Arnold Schiefer, the new CEO of ALPINE, will direct the process of transforming the group to ensure that it retains its leading position in its domestic markets, basically Austria and Germany. Schiefer's appointment is a clear, positive, stabilising message from FCC to the ALPINE Group's workers, business partners and financiers.

A graduate in Business Studies, Schiefer commenced his career in Tyrol, where he eventually became a division head at the Infrastructure Ministry in Vienna in 2000. In 2005, he changed to the Austrian Federal Railway (ÖBB), where he took over project management for the construction of Vienna's Central Train Station. As Chairman of the Board, he supervised the merger and reorientation of ÖBB-Infrastruktur AG. In 2011, he was hired by Rail Cargo Austria AG to reorganise and turn around Rail Cargo Hungaria. He was most recently Chairman of the Board at Rail Cargo Austria AG.

Alpine recently reached an agreement with the Austrian government and its main creditors to restructure the group and refinance its debt.

Additionally, Fernando Moreno has been appointed as Chairman and Miguel Jurado as General Manager of FCC Construction.
 

The new section abuts with a section opened earlier between La Rinconada (connection with the A-4) and Alcalá de Guadaíra (connection with the A-92), so 15 kilometres of the new ring road are now in operation.
This project is just another step toward the Ministry of Development’s firm goal of building the SE-40 to provide traffic with an alternative to the overburdened SE-30.

Description

The project includes the construction of 5.96 kilometres of new trunk road along a brand-new layout. Each of the two carriageways is 10.5 metres wide and has three 3.5-metre-wide lanes, a 2.5-metre-wide outer verge and a one-metre-wide inner verge. The central reservation is 10 metres wide. Flanking the road are one-metre berms. This design leaves the door open to a possible expansion to four lanes in future.

Blending into the environment

A total of 4.15 million euros has been invested in blending the road into its surrounding environment. The leading measures are:

• Tracking the archaeological heritage. Archaeological finds were made at three spots along the layout, Adaines II, Torrequinto and Pozo de la Culebra. Their discovery made it necessary to dig test pits and conduct special earthworks, to carefully uncover the findings and remove them for safekeeping elsewhere. All finds were turned over to the provincial office of the Andalusia Council’s Culture Department.
• Replanting of embankment slopes, traffic islands, roundabouts and cleared areas. Topsoil was laid down over the bare areas, followed by hydroseeding. • Noise protection. Two sound-absorbing screens were installed in the areas closest to buildings.
• Fencing was put up all along the road to keep animals from straying into the path of traffic.
• Settling basins were dug to intercept any potential accidental discharge on the banks of the Guadaíra River.
• 14 safe animal crossings were built.

Construction Area:

FERNANDO MORENO GARCÍA, Chairman of FCC Construction and member of the Management Committee. Mr Moreno, who replaces José Mayor Oreja, will report to the Vice-Chairman and CEO, Juan Béjar Ochoa.

In 1973, he obtained a degree in Civil Engineering from the Madrid School of Civil Engineering. That same year he joined Dragados y Construcciones S.A., where he remained until 1986, when he was hired by Construcciones y Contratas, S.A. as Head of Civil Engineering in the Madrid area. He later became Manager of the Central Spain Area for FCC Construction.

In 1996, he was appointed General Manager of Seragua, FCC's water management subsidiary. In 2000, he was appointed General Manager of Aqualia, the end-to-end water management company resulting from the merger between Seragua and Veolia's water management companies in Spain.

MIGUEL JURADO FERNÁNDEZ, General Manager of FCC Construcción. Mr Jurado obtained a degree in Civil Engineering from the Technical University of Madrid in 1987,
and joined FCC in 1988, where he has held the positions of head of production, site manager and production manager. In 2005, he was named head of Development and Subsidiaries at Aqualia; that same year, he was appointed Deputy General Manager of Development and International Business at Aqualia, a post he has held to date.
 
AVELINO ACERO DÍAZ, General Manager of Corporate Functions and Special Projects at FCC Construction. Mr Acero is a civil engineer and has been with FCC for 27 years, most recently as General Manager of the Construction division. He has extensive experience in railway and other transport infrastructure projects. He graduated from the University of Madrid in 1971, and worked at Corsan until 1986, when he joined FCC.

AURELIO CALLEJO RODRÍGUEZ, Head of Construcción Central America. Mr Callejo obtained a degree in Civil Engineering from the Technical University of Madrid in 1984. He joined FCC in 1985 as Head of Production. He has held a number of positions in the group, up to his current position as Manager of the Castilla-La Mancha and Extremadura Region for FCC Construction.

Corporate Area

ANA VILLACAÑAS BEADES is the new General Manager of Organisation and a member of the Management Committee. A graduate in Civil Engineering from the Technical University of Madrid, she was formerly General Manager of Corporate Resources at Isolux Corsan.
She was previously Head of Human Resources, Quality and Environment at Ferrovial Agroman and Cintra. Ms Villacañas will report to the CEO.

CARLOS BARÓN THAIDIGSMANN, General Manager of Divestments, will retain his existing position as General Manager of Versia, and will head the office that coordinates the divestment programme announced as part of the new strategic plan. He was formerly a zone manager at Cemusa, Head of Corporate Development at Versia, and Head of Administration and Finance at FCC Agua y Entorno Urbano. Before joining FCC, he worked as CFO at Arthur Andersen, Alas, S.A. and TFE, S.A., and as manager at Dygsa.

Services Area

FÉLIX PARRA MEDIAVILLA, Deputy General Manager – Water. He graduated from the Complutense University of Madrid in 1977 with a degree in Geology. From 1980 to 1993, he worked at Geoservices, S.A., a multinational company providing oil and gas exploration services, where he held a number of positions. In 1993, he joined Grupo General de Aguas de España (currently Veolia) as deputy regional manager for Andalucía; he was subsequently appointed Head of Development, and finally Regional Manager for Central Spain in 1998. Since 2000, he has been Manager of the Central Spain region for Aqualia.
 

Tomorrow, FCC Vice-Chairman and CEO Juan Béjar will give a presentation to analysts on the basics of the plan: a focus on strategic businesses (environmental services, infrastructure and water), a significant reduction of debt, adaptation of the group to the current conditions in the markets where it operates, and a recovery in recurring operating income to ensure stable returns for shareholders. Said Mr Béjar, "We will work tirelessly on repositioning and adaptation to leverage FCC Group's long-standing strengths."

The writedowns and restructuring provisions recognised in 2012 amount to 1,146 million euro. Of that figure, 300 million euro correspond to operating losses in construction activities in Central and Eastern Europe, grouped under Alpine.

The strategic reorganisation and the withdrawal from specific Construction and Cement markets, together with other non-recurrent losses, led to restructuring provisions of 204 million euro. Additionally, losses due to writedowns on equity-accounted affiliates (Realia and Globavía) and discontinued businesses (FCC Energy) totalled 372 million euro, and another 352 million euro corresponds to impairment of goodwill at several companies.

Consolidated revenues amounted to 11,152 million euro, evidencing the effects of the Construction area's reorganisation and withdrawal from certain markets in Central and Eastern Europe, together with the decline in the area's activity in Spain. Excluding the revenues from the areas affected by the adjustments, growth outside Spain would have totalled 8.4% in the areas of Environment, Cement and Versia.

Strength in Environmental Services

EBITDA totalled 753 million euro in 2012, i.e. 40% less than in 2011, due mainly to the impact of the 300 million euro in exceptional losses and provisions at Alpine resulting from the discontinuation and progressive withdrawal from certain contracts and markets, mainly in Eastern Europe.

Excluding the net effect of writedowns at Alpine, FCC Group EBITDA would have amounted to 971 million euro, i.e. a decline of 22.7%, due mainly to weak Construction and Cement demand in Spain. However, that figure does not yet reflect the positive effect of the operating restructuring plan implemented in Cement in the second half of the year.

Additionally, the Environmental Services area, which is increasingly important, significantly expanded its contribution to overall operating profit, although this effect was due to non-recurrent losses in the Construction area. This area has very consistent EBITDA (683 million euro).
Interest-bearing debt, which was also affected by the one-off restructuring process, increased by 494 million euro in the year, to 7,087 million euro at 31 December 2012.

The Group's backlog shrank by just 2.9% Amounting to almost 25 billion euro, the backlog is equivalent to two and half years' of billing.

KEY FIGURES (million euro)

	2012	2011	Change (%)
Net sales	11,152	11,896	-6.3
EBITDA	753	1,256	-40.0
Income attributable to equity holders of the parent company	(1,028)	108	---
Total interest-bearing debt	7,087	6,593	+7.5
Backlog	24,980	25,719	-2.9

Among other management positions, Saenz de Miera has been responsible for the Mexican cement group CEMEX in southern Europe, Africa, Middle East and Asia, and Vice President and Managing Director of CEMEX Spain.

Saenz de Miera replaces Juan Béjar, who has been appointed Vice President and CEO of the FCC group a month ago and who has resigned as CEO of Cementos Portland Valderrivas to give place to his successor in the Board of Directors.

At the next shareholders meeting Juan Béjar will be proposed as member of the Board of Directors of the company.

The Board has also agreed the appointment as Vice President of Alicia Alcocer Koplowitz, keeping the Vice Presidency held by Esther Koplowitz Romero de Juseu.

The two appointments have been agreed prior favorable report from the Committee of Appointments, Remuneration and Corporate Governance.

These appointments arose following Baldomero Falcones Jaquotot's resignation as Chairman and CEO. Falcones became Chairman of the Board in June 2008, six months after his appointment as CEO. He will now chair the FCC Foundation.

The appointments, which mark the beginning of a new era, were vetted beforehand by FCC's Appointments and Remuneration Committee.

To date, Esther Alcocer Koplowitz has been Second Vice-Chairman of FCC; Juan Béjar is Chairman and CEO of Cementos Portland Valderrivas and Executive Chairman of Globalvía.
Esther Koplowitz Romero de Juseu will continue as First Vice-Chairman of the Board of Directors.
 

The sales in Tres Cantos were effected under an agreement with the city government under which company Gedesar has acquired 576 homes for rental with option to buy. Another 600 homes were sold to the winners of the tender held by the city government, in which there were over 3,200 bids.

FCC Construction has also sold 560 homes in a number of developments in Sevilla. These sales represent approximately 60 million euro in revenues.

Carlos García León, Head of Development and Sales at FCC Construction: "these transactions are a major achievement and provide a boost to our business. They are particularly notable given the serious economic difficulties and the steady decline in home sales in recent years."

FCC Construction's home sale revenues surged in 2012. During the year, it has sold 1,823 homes, compared with 252 in 2011, and obtained 228 million euro in revenues, i.e. 180 million euro more than last year. Additionally, the prospects for the early months of 2013 are good. FCC Construction plans to sell a new development in Tres Cantos (100 homes) as well as 100 price-controlled homes in Andalusia.

Civil Engineering Award
Early in December 2012, the AR Nuevo Tres Cantos development was named "Best Municipal Public Project" of the year by the Madrid Association of Civil Engineers. This sustainable complex is part of a development project designed to serve 30,000 new residents of Tres Cantos, and includes major work to provide access to the network of highways around the city. The AR Nuevo Tres Cantos development is a sustainable complex in itself.

Moreover, the development work contributes to enhancing living standards for current and future residents in the area. Utility diversions and site development work have been aimed at enhancing the surroundings while minimising the environmental impact; parkland has been expanded by over 50 hectares.

Experience in site development and home building
FCC Construction has engaged in site development work in several areas of Madrid and its region: Moscatelares (San Sebastián de los Reyes), PAU II, 3 Las Tablas, phases 1 and 2 of PAU II in Montecarmelo, and Parque de Valdebebas.

It also performed additional development work in the Montmar subdivision, in Castelldefels, for Barcelona City government, and the construction and development of Gran Vía and Plaza Europa in L'Hospitalet, which received the Construmat 2009 award. FCC's construction division has also built business parks in A Laracha (A Coruña) and Bobes (Asturias).

In the current economic and financial situation, a number of factors are reducing the funds being generated by the FCC Group and creating the need to recognise losses as a result of writing down some of the company's assets. Consequently, the Board of Directors of FCC, applying the principle of prudence and in the best interests of all the shareholders, has decided not to distribute a dividend out of 2012 income.

The purpose of this decision is to:

• Strengthen the balance sheet by retaining earnings in order to support shareholder value creation going forward;
• Reduce indebtedness and maintain profitable growth in operations;
• Focus on developing and enhancing the company's core business, and on accelerating the process of divesting non-strategic assets, to which the Group is fully committed.
 

The agreement was signed at FCC's new corporate headquarters in Las Tablas by Dionisia Muñoz Morales, Secretary of Social Policy and Equality for the General Union of Workers Federation of Metal, Construction and Related Sectors; Juana Aguado Pérez, Secretary of Equality for the Comisiones Obreras Federation of Industry; and Antonio Alfonso Avelló, manager of FCC SIE.

As things stand, seven FCC Group companies have signed Equality Plans: FCC S.A., FCC Construction, aqualia, Cementos Portland Valderrivas, Cemusa, FCC Logistics, and FCC SIE.

The agreements, promoted by the Labour, Legal and Corporate Social Dialogue Area of the Human Resources Department, share a common goal: to encourage specific measures and actions with a view to extending activities and campaigns related to equality throughout the Group's business areas. The Equality Plans focus principally on access to employment, training, promotion, compensation, measures to avoid harassment and to protect victims of gender violence, workplace health, work-life balance, shared responsibility, and awareness raising about equality. FCC SIE will also adopt the agreement signed between FCC and the Spanish Ministry for Health, Social Policy and Equality to facilitate job placement for female victims of domestic violence.

FCC's Equality and Diversity Strategy

FCC's Human Resources Department seeks to make the Group a standard bearer in the area of people management, diversity and equal opportunity.

Equality as a part of corporate culture has been strengthened by a negotiation strategy and the implementation of equality plans adapted to the activity, situation and profile of the workforce at each FCC company, making the Group an equality pioneer in the sectors where it operates. The company has also created joint committees with the labour unions to monitor those plans together.

FCC water subsidiary aqualia received the Equality Mark from the Spanish Ministry for Health, Social Policy and Equality, and the Group also supports the Women's Empowerment Principles, which are part of the United Nations Global Compact and seek to encourage female participation in all economic decision-making processes.

FCC has a protocol which is triggered automatically in the event of a harassment complaint or signs of improper behaviour.

To properly manage diversity, equal opportunity and non-discrimination and to eliminate any type of harassment, FCC has an international Diversity and Equality Committee in which the Group's principal business areas are represented.

Within its commitment to diversity, the Group is working on creating jobs for members of groups at risk of social exclusion. As a result, the Group currently has 1,042 employees with some degree of disability, and the agreement signed with the ONCE Foundation will enable it to hire another 150 people in this category over the next three years.

In addition to supporting numerous initiatives in this area, FCC has also signed an agreement with the Ministry of Health, Social Policy and Equality to assist women who have been victims of gender violence to find work, and it has agreements with other bodies, such as the Integra Foundation and Exit Foundation, to hire people at risk of social exclusion, such as certain groups of young people and women who have suffered gender violence.

The new control tower will be 80 metres tall and allow for future expansion of the airport while also serving as an important landmark for the city. The new building and the management centre, which will span 16,300 square meters, will accommodate the increase in air traffic and airport operations.

El Dorado ranks first in Latin America in terms of cargo volume and third in passenger traffic (20 million per year). This project, one of the most important airport infrastructure works awarded by Colombia's civil aviation authority (Aerocivil), will provide the country with a modern airport which meets the needs and future challenges of providing air travel and traffic control services in Latin America.

FCC Construction has significant experience in highly-complex airport construction projects worldwide. Most notably, it built the T1 passenger terminal at El Prat airport in Barcelona and Terminal 4 (T4) at Madrid-Barajas. The company also recently won a 96 million euro contract to refurbish Riga airport (Latvia).

Presence in Latin America

This contract strengthens FCC's leading position in Latin America, a strategic area in the company's globalisation process. Other important projects currently under way in the region include the construction of Line 1 of Panama Metro, the first in Central America; a hospital complex in Panama City; a new access channel from the Pacific to the Panama Canal; and the Mina de Cobre road. In Costa Rica, the company is expanding the Cañas-Liberia national highway in Guanacaste and holds the concession (through Globalvía) to operate the San José-Caldera toll road.
 

The consortium will renovate the runway pavement and strengthen the runway safety areas, which will enhance the airport's safety. It will also build two new taxiways to increase the runway capacity and rebuild two aprons.

The location of Riga Airport and the adverse weather conditions in winter require the construction of two de-icing areas and two hangars, for vehicle washing and waste collection. The project also includes the renovation of the drainage system and improvements to the lighting system.

The contract, which will be executed in 16 months, has a budget of over 96 million euro. Passenger traffic at Riga Airport totalled 5.1 million in 2011.

Airport experience

FCC's construction subsidiary has notable experience in highly complex airport projects around the world. In Spain, the company has worked on passenger terminal T1 at Barcelona El Prat Airport and the Terminal building and car park at Palma de Mallorca Airport, spanning 250,000 square metres.

At Madrid-Barajas Airport, the company built a third runway, measuring 4,440 metres, in 18 months, as well as the T4 terminal, which won the Bridge of Alcántara International Award.

Outside Spain, FCC Construction built the terminal at SCL Santiago Airport, in Chile, and airport facilities in Kingston, Jamaica.

Apart from the Riga Airport contract, FCC had a backlog of over 2 billion euro in infrastructure projects outside Spain at the end of the third quarter of 2012. Of those projects, the most notable include its participation in a joint venture to design and build a replacement for the Gerald Desmond Bridge in the Port of Long Beach (Los Angeles), for 145 million euro in attributable revenue.

The company's experience in rail construction includes two tunnels and the Highway 407 station of the Toronto Subway, in Canada, for 269 million euro, and the three sections of the Simeria-Braşov railway line in Romania, for 830 million euro. The company also obtained contracts to build a section of Line 5 of the Bucharest Metro in Romania, for 267 million euro; the Olsztyn tramway (north of Warsaw) in Poland, for 62.5 million euro; and a rail-road project awarded to Alpine, for 170 million euro.