Técnicas Reunidas, S.A.

Reported Q2 sales were EUR 1,478 million and Q2 EBIT was EUR 73 million, equal to about 5% of sales. For the first half, sales increased 12% year over year to EUR 3,061 million and EBIT was EUR 104 million, after a EUR 45 million provision related to the Middle East conflict. Net cash was EUR 344 million at June 30 versus EUR 332 million a year ago, and equity rose to EUR 622 million from EUR 564 million. Management maintained its 2026 underlying guidance, said full-year revenues are expected to be around EUR 6.5 billion, and noted the year-end cash position should be better than the current figure.

Juan Llado emphasized three core messages: Middle East projects are progressively normalizing, the company has very strong order intake, and TR is well positioned in Middle East investment, power, and North America. He highlighted a EUR 5 billion sole-source job with ADNOC and Exxon as a quality signal, and a Canadian power award as validation of the power strategy and North American positioning. His tone was upbeat and confident, repeatedly saying there is 'more to come.'

Eduardo San Miguel said the spin-off of TR Power was a key milestone and argued the business could now plausibly reach EUR 2 billion of annual revenues, versus the earlier EUR 1 billion target. He said TR Power backlog was about EUR 2.2 billion, with another EUR 1.1 billion Emirates project and EUR 1.5 billion of RWE work still awaiting final notice to proceed, and he expects the power workforce to double to close to 1,500 people by year-end, with hiring centered in India. On margins and capital, he reiterated that the EUR 45 million provision remains the right estimate if the conflict ends in Q3, said net cash reached EUR 344 million, equity hit a record EUR 622 million, and reaffirmed the 30% payout policy.

Analysts focused on three issues: whether the EUR 45 million Middle East provision could prove too low if the conflict lasts longer, whether H2 revenue should step up sequentially, and how working capital and cash will evolve. Management said the provision is based on a thorough three-month analysis of extra costs, recovery from clients, and supplier disputes, but declined to guess on a longer conflict; it also confirmed 2026 revenue guidance of around EUR 6.5 billion and said year-end cash should improve materially as award-related down payments come in. On Middle East exposure, management said most projects are either too early or too late in execution to be heavily affected, and that only two large projects in two countries are facing major logistics issues because equipment must be routed around the closed Strait of Hormuz.