Elecnor posts nine-month net profit of EUR 55 million, with 49% higher international sales

1.6% increase in consolidated revenue

Madrid, 14 November 2013.- Elecnor reported a 1.6% year-on-year increase in consolidated revenue in the first nine months of 2013 to EUR 1.35 billion.

Sales were up 49% in the international market, but down 29% in the domestic market compared to the same period last year. Revenue from the international market outstripped that from the domestic market in the first quarter this year for the first time, and After the third, this market has increased its lead, representing 58% of total sales, compared to 40% a year earlier.

The main drivers of this change are:

• The increase in business volume contributed by other subsidiaries operating in various fields of infrastructure outside Spain, above all those in the US, Mexico, Venezuela, the UK and Brazil.
• The larger contribution by overseas wind farm operators, thanks mainly to the start-up of the new facilities at Elecnor’s wind farm complex in Osorio-Palmares (State of Grande do Sul, Brazil).

This easily made up for the continuing decline in business in the domestic market, caused mainly by:

• Lower revenue from the concession assets managed by the Group as developer and investor, especially solar thermal and wind power, as a result of regulatory changes made in December 2012, and February and July 2013.
• The overall decline in activity in the various subsectors of infrastructure.

Results: impact of renewable energy and new renewable regulations

Successive changes in the regulatory framework governing renewable energy in Spain, first in December 2012 and then in February and July 2013, caused earnings of renewable power plant operators, especially solar thermal and wind farms, to plunge.

The changes had a severe negative impact on the Elecnor Group’s consolidated net profit, which in the first nine months of 2013 amounted to EUR 55 million, marking a 33% decline on the year-ago period. Last year, the company benefited from the final stage of construction of its three solar thermal plants in Spain.

Three other circumstances also affected results:

• The adverse movement in the Brazilian real-euro exchange rate, which hurt both revenue and income from companies operating in Brazil.
• Lower investment by the Group’s main clients, which resulted in lower business volume, fierce price competition and, ultimately, thinner margins.
• Delays in the start of certain major construction projects overseas.