Fomento de Construcciones y Contratas, S.A.

The company reported net financial debt of EUR 2.3 billion at year-end, down 23%, after EUR 1.2 billion of net investments and a EUR 1 billion cash inflow from an additional minority stake sale in FCC Enviro. Operating cash flow reached EUR 1.2 billion, gross investments were EUR 1.23 billion, and the future revenue portfolio ended above EUR 51 billion, up 11.4%. By division, Environment revenue grew 9.1% to EUR 4.74 billion with EBITDA of EUR 789.8 million and a 16.7% gross margin; Water revenue rose 6.9% to EUR 1.7 billion with EBITDA of EUR 450 million and a 25% margin; Construction revenue increased 3.4% to over EUR 3 billion, but EBITDA fell 49.9% to EUR 85.8 million and gross margin to 2.8% due to fourth-quarter adjustments; Concessions revenue rose 45.5% to EUR 112 million with EBITDA of EUR 60.4 million, up 10.8%. Management said 2026 should see continued growth, with Construction revenue growth expected to be more moderate than 2025.

Miguel Coronel Granado framed the year as one of broad operational stability, strong project execution, and significant portfolio expansion. He emphasized that the group’s business model is backed by long-duration contracts and that the 11.4% portfolio growth gives FCC strong visibility into future revenues. His tone was cautious but constructive: he acknowledged the Construction issues in the fourth quarter, while stressing that the broader business remains robust and the balance sheet has strengthened materially.

He highlighted the main profit drags as the EUR 267 million contraction in parent-company result, including EUR 96 million of one-off provisions, a EUR 53 million foreign-exchange effect from euro strength, and construction-related adjustments. He also pointed to a strong cash and balance-sheet outcome: operating cash flow of EUR 1.2 billion, gross investments of EUR 1.23 billion, and year-end net financial debt of EUR 2.3 billion, down 23%. He added that financial debt closed at EUR 5.3 billion, treasury increased by more than EUR 800 million, and leverage was below 2x EBITDA.

Analysts focused on the size and timing of Environment provisions, the magnitude and cash impact of Construction fourth-quarter adjustments, the sustainability of Construction margins and working capital, and the outlook for dividends. Management said environmental provisions were about EUR 90 million in 2025, expects a significant recovery in 2026, and said there were no additional differential provisions in the fourth quarter. On Construction, management said the fourth-quarter adjustments were preventive, not litigation-related, and did not create specific cash outflows; they also said 2026 Construction revenue growth should continue but at a more moderate pace. On dividends, management reiterated there is no formal guidance, citing the flexible dividend and the Board’s role in setting it.