Mota Engil SGPS SA

ELI:EGL

Q4-2021 Earnings Call

[Operator]

Good

afternoon,

ladies

and

gentlemen

and

welcome

to

Mota-Engil's

Full

Year

2021

Results

Presentation.

I

now

pass

the

floor

to

Mr.

Pedro

Arrais,

Head

of

Investor

Relations.

Please

go

ahead,

sir.

[Pedro Arrais, Head-Investor Relations, Mota-Engil SGPS SA]

Hi.

Good

afternoon and

thank

you

all

for

assisting

this

call

where

we

will

present

the

annual

results

of

2021.

With

me,

I

have

as

usual

Mr.

Gonçalo

Moura

Martins,

the

CEO

of

the

company.

And

we

will

start

the

presentation

with

some

key

highlights

by

the

results

overview

and

at

the

end

we

will

have

the

usual

Q&A

session

when

we

have

the

opportunity

to

clarify

any

doubts

that

you

might

have.

I

will

suggest

that

we

move

to

slide

4

of

the

presentation,

and

as

a

snapshot

I

would

like

to

start

to

say

that

the

company

reached

a

record

level

in

backlog

of

€7.6

billion

and

the

turnover

of

€2.65

billion.

That

represents

a

relevant

milestone

for

the

company

and

record

level.

Our

profitability

reached

15%

and

our

net

profit

was

€22

million

which

compares

to

a

net

loss

of €20

million

in 2020.

In-line

with

the

guidance,

the

company

made

a

CapEx

of

€213

million

while

our

net

debt

decreased

to

€1.1

billion

with

our

gearing

improving

to

2.7

times

recovering

to

levels

before

pandemic

context.

Moving

to

slide

6 (sic) [7] (00:01:52),

we

can

see

the

breakdown

of

the

P&L

and

starting

by

Europe,

the

Engineering

[Technical Difficulty]

[00:02:01] performance with

the

small

decrease

in

Poland

in

the

second

half

of

2021,

while

profitability [Technical Difficulty] [00:02:12]

with

EBITDA

margin

moving

up

from

5%

to

7%

and

in

the

Environmental

business,

the

revenues

were

up

6%

year-on-year

and

EBITDA

margin

reached

27%,

up

from

25%

in

2020

positively

impacted

by

the

tariff

revision

approved

by

the

regulator

during

the

year.

In

Africa,

it's

important

to

highlight

the

strong

growth

of

56%

in

turnover

in

the

second-half

of

2021

that

put

the

African

division

with

more

than

€900

million

of

sales,

increasing

4%

year-on-year

with

EBITDA

margin

reaching

22%

above

the

guidance.

In

Latin

America,

the

company

reached

an

increase

in

turnover

of

15%

year-on-year

to

€685

million

and

an

EBITDA

margin

of

13%,

a

positive

result

driven

mainly

by

the

operations

in

Mexico,

the

main

market

in

the

region.

For

last

and

considering

that

in

2022 with

the

new

strategic

plan

implemented

and

with

the

results

being

presented

in

the

future

by

business

units,

I

would

like

to

give

you

some

color

about

the

contribution

from

the

Non-Engineering

Construction

business

that

achieved

in

2021

a

turnover

of

€820

million,

representing

31%

of

the

total

amount

of

turnover

and

€224

million

of

EBITDA.

In

Non-Engineering

Construction,

we

should

highlight

the

Environment

with

€443

million

of

turnover

and

€121

millions

of

EBITDA

with

the

27%

margin

and

Industrial

Engineering

Services

with

€235

million

of

turnover

and

€94

million

of

EBITDA,

representing

a

[ph]

net

effective (00:04:22)

40%

EBITDA

margin.

Moving

to

slide

8,

looking

to

the

commercial

activity,

we

can

see

that

the

company

achieved

once

again

a

new

record

level

of

backlog

of

€7.6

billion,

an

increase

year-on-year

of

25%

reflecting

the

successful

achievement

of

our

commercial

teams

more

recently

and

especially

in

Africa.

From

the

total

amount,

almost

€7.2

billion

corresponds

to

backlog,

Engineering &

construction

representing

more

than

3.5

years

of

the

annual

turnover

in

Construction.

Very

important

to

mention

the

consolidation

of

the

increasing

trend

of

the

long-term

contracts

with

larger

average

contract

size

which

is

very

positive

for

the

outlook

considering

the

profitability

and

stability

of

the

cash

flow

generation.

Finally,

important

to

mention

that

[audio gap]



(00:05:31) in

the

contracts

already

signed

in

2022

in

several

markets

like

Uganda,

Mexico,

[audio gap]

(00:05:41), the

backlog

at

this

moment

above

€8

billion

for

the

first

time

in

our

history.

Moving

to

slide

9,

I

will

not

see

elaborate

on

that

but

you

can

see

that

the

majority

of

the

major

contracts

are

in

what

we

consider

the

core

markets;

the

markets

in

a

higher

dimension

showing

in

that

way

that

nowadays

the

group

don't

depend

on

a

specific

market

or

business

having

a

balance

exposure

between

regions

and

businesses.

Slide 10,

we

can

move

to

the

CapEx,

we

made

– the

company

made

a

total

CapEx

of

€213

million

with

growth

in

long-term

contracts

representing

51%,

mainly

channeled

to

projects

recently

awarded

in

Africa.

That

represents

45%

of

total

CapEx.

The

railway

project

in

Mexico,

Train

Maya

and

EGF,

the

waste

treatment

company

based

in

Portugal.

The

maintenance

CapEx

represents

roughly

4%

of

the

turnover

of

the

company,

in-line

with

the

recent

years

and due

to

the

optimization

of

the

procedures

in

planning,

procurement

and

logistics.

Moving

to

slide

11,

we

can

see

here

the

working

capital

evolution

that

was

€6

million

reinforcing

the

positive

trend

of

the

last

years.

The

main

contributor

for

the

improvement

of

the

working

capital

was

a

higher

exposure

to

private

clients,

in

projects

with

larger

size

and

with

prepayments

established

and

the

reinforcement

of

corporation

in

the

recent

years

with

multilaterals

and

export

credit

agencies

with

positive

impacts

in

the

working

capital

evolution.

Moving

to

slide

12,

we

can

see

here

that

Mota-Engil

have

operating

cash

flow

of

€350

million

and

we

managed

a

reduction

of

net

debt

in

€125

million.

With

a

stronger

operational

performance

in

the

second-half

the

company

achieved

a

net

debt

of

€1,118

million.

Moving

to

slide

13,

we

can

see

the

debt

position

in

more

detail

and

you

can

see

here

the

gearing

that

improved

to

2.7

times

returning

to

levels

before

pandemic

with

the

combined

effort

of

increasing

EBITDA

and

reducing

debt

and

broadly

with

a

stable

cost

of

debt.

Worth

to

highlight

that

our

liquidity

position

of

€964

million

equals

to

1.6

times

of

the

non-revolving

financial

needs

with

maturities

with

less

than

one

year

and

with

the

short-term

debt.

And

in

which

€232

million

is

[audio gap]



(00:09:02) or

to

be

financed

broadly

shortly.

That

represents

roughly

40%

of

the

short-term

needs

for

[audio gap]



(00:09:12) and

are

already

refinanced

in

the

first

quarter

of

2022.

In-line

with

ESG

targets

which

we

are

committed,

it's

important

to

mention

that

the

company

issued

in

November

the

first

sustainability-linked

bonds

to

retail

markets

in

Portugal

with

a

successful

achievement

amounting

€132

million.

Our

focus

for

the

next

years

will

be

strengthening

the

balance

sheet

and

on

increasing

the

debt

maturities

and

reducing

the

cost

of

debt

with

new

operations

in

the

near

future.

Moving

to

slide

16

to

overview

and

outlook

for

each

region,

we

will

start

in

Europe

in

slide

16

and

the

turnover

in

Engineering

& Construction

division

showed

the

strong

evolution

of

11%

year-on-year

and

in

Portugal

and EBITDA

increased

and

the

EBITDA

as

a

whole

increased

[audio gap]



(00:10:25), helped by the

increase

of

the

average

size

of

contracts

and

higher

profitability

in

the

main

markets

such

as

Portugal

and

Poland,

allowing

that

the

EBITDA

margin

increased

from

5%

to

7%

in

the

Engineering &

Construction

segment.

The

outlook

for

the

Engineering &

Construction

division

in

Europe

is

positive

as

we

expect

a

more

dynamic

public

tender

scenario

going

forward

in

Portugal,

considering

the

Recovery

and

Resilience

Investment

Plan

for

Portugal.

Here

and

for

the

short-term,

we

expect

relevant

decisions,

namely

in

the

new

hospital

in

Lisbon

for

which

we

are

competing

only

with

one

Spanish

company

at

the

final

stage

of

the

tender

and

we

are

fully

convicted

that

we

have

the

best

proposal

for

a

very

important

project

to

improve

the

health

public

system

in

the

country

where

the

quality

of

the

infrastructure

will

be

decisive

for

the

future

operation

of

the

units.

In

the

Environmental

business,

the

turnover

was

up

6%

year-on-year

to

€355

million

and

the

EBITDA

was

up

15%

year-on-year

to

€199

million, reflecting a

better

performance

in

the

waste

treatment

business

positively

impacted

by

the

adjustments

that

followed;

the

recognition

of

tariffs

made

by

the

regulators

in

the

last

year

regarding

Environmental

business.

A

new

regulatory

period

will

start

in

2022

and

we

believe

that

there

is

also

upside

potential

in

this

business

as

we

believe

we

have

now

a

better

starting

point

for

the

discussion

even

in the

recent

and

positive

tariffs

reviews

from

the

regulator.

Moving

to

slide

18,

moving

to

Africa

the

turnover

[audio gap]

(00:12:32),

a

very

strong

performance

in

the

second-half

of

2021

with

an

increase

of

56%

year-on-year

and

once

again

with

the

operational

performance

that

allowed

the

African

division

to

be

above

the

guidance

achieving

a

22%

margin.

Another

item

that

is

fair

to

highlight

is

the

very

positive

results

from

the

business

development

department

reflecting

the

recent

contracts

awarded

that

bring

the

backlog

in

Africa

to

a

record

level

of

€4.8

billion,

at

least

allowing

to

anticipate

a

positive

outlook

regarding

the

execution

of

the

existing

contracts

for

the

upcoming

years.

Although

the

focus

will

be

in

the

execution,

the

pipeline

remains

strong

with

the

commodities

price

opening

new

opportunities

of

public

and

private

investment

in

the

continent.

Finally,

we

should

bear

in

mind

that

the

goal

[audio gap]



[00:13:41-00:13:46] in

the

Environmental

business

in

Africa

helping

with

our

knowledge

and

technical

skills

[audio gap] (00:13:52) African continent

capacity

to

enter

in the

circular

economy.

Moving

to

slide

20,

Latin

America

and

during

2021, you know

that

this

region

was

the

most

impacted

by

the

context

of

pandemic

in

2020

and

here

we

can

see

the

consolidation

of

a

full

recovery

of

the

activity

with

a

20%

growth

in

the

second-half

of

2021,

supported

mainly

by

the

main

market

that

is

Mexico

that

showed

in

the

full-year

a

very

good

performance,

increasing

23%

year-on-year

to

€392

million,

mainly

supported

by

the

ongoing

project

of

the

first

stretch

of

Train

Maya,

the

biggest

railway

project

in

this

moment

being

built

in

Latin

America

and

the

positive

contribution

of

the

energy

business.

I

would

like

to

highlight

also

the

positive

contribution

from

the

profitability

of

the

region

from

Peru

and

Brazil,

two

important

markets

in

the

region

that

are

increasing

margins

for

all

the region

and

focusing

in

a

more

selective

backlog

with

a

higher

exposition

to

private

clients.

Looking

to

the

future,

we

have

to

say

that

our

goal

is

to

revamp

the

commercial

activity

in

2022

also

and

already

with

positive

results

from

the

commercial

front

mainly

in

Mexico

and

Peru

that

supports

a

positive

outlook

for

the

upcoming

years.

And

now

we

will

be available – we are

available

to

any

questions that

you

might

have.

And

so

we

can

proceed

with

the

Q&A

session.

Thank

you.

[Operator]

Thank

you.

Ladies

and

gentlemen,

the

question

and

answer

session

starts

now.

[Operator Instructions]



The

first

question

comes

from

Artur

Amaro

from

Caixa

Bank

BPI.

Please

go

ahead.

[Artur Amaro, Analyst, Caixa Banco de Investimento SA]

Hi,

good

afternoon.

Just

a

minor

correction

to

the

moderator,

it's

not

Caixa

Bank

BPI PPA,

it's

from

Caixa

BI.

It's a

little

different.

So

thanks

for

taking

my

questions.

The

first

one

comes –

relates

with

the

EBITDA

performance

on

the

quarter.

EBITDA

was

down

2.5%

year-on-year

despite

a

very

significant

increase

in

revenues.

I

would

like

to

know

more

precisely

what

was

the

reason

behind

the

EBITDA

fall?

I

assume

that

we're

talking

about

a

very

significant

increase

of

raw

material

prices.

The

second

question

relates

also

with

the

very

significant

reduction

of

financials.

It's

a

positive

news,

minus

38%

year-on-year

just

to

have

an

idea

of

what

was

the

reason

behind

this

very

significant

reduction

of

financials

and

if

this

can

be

considered

recurrent

going

forward?

Thanks

for

taking

my

question.

Hi?

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Hi.

Yes,

you

are

right.

Caixa

BP

and

the

Caixa

BI is

a

very

large

difference,

a very

large

difference.

So

the

first

question

is about

EBITDA

in

the

second-half

I

think

comparing

with

the

previous

year.

[Artur Amaro, Analyst, Caixa Banco de Investimento SA]

Yes.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Basically

doing

the

other

–

it

is

different

of

operational

margin.

If

you

see the

operational

margins, I

don't

think

we

disclosed

that.

The

average

is

almost

the

same.

It's

a

little

bit

better

in

2020

than

it

was

this

year.

The

EBITDA it

had

some

impact

sometimes

because

we

have

internal

corrections

when

we

closed

some

projects we need to.

In 2020,

we

closed

some

important

projects

and

that's

led

for

this

difference

in

EBITDA.

But

it

will

say

it's

not relevant

and

is

not

linked

to

this

inflation

of

raw

materials.

Nothing

of

that

has

that

potential

dimension.

Not

at

all,

first

of

all.

The

second

question

is

about

the...? Sorry...

[Artur Amaro, Analyst, Caixa Banco de Investimento SA]

Reduction

of

financials.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Yes. So

we

have

materially

and

effectively

a

difference

and

improved

in

our

financial

costs,

but

of

course this

main

difference

is

related

with

a

gain

of

capital

with

an

operation

that

we

did

at

the

end

of

the

year

in

Mexico

with

our

tourism

subsidiary.

[Artur Amaro, Analyst, Caixa Banco de Investimento SA]

Okay. Which

means

it's

non-recurrent,

right?

[Gonçalo Nuno Gomes de Andrade Moura Martins]

A part of

that

is

not

recurrent.

[Artur Amaro, Analyst, Caixa Banco de Investimento SA]

Okay.

Thanks

for

taking

my

questions.

Very

clear

your

answer.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Thank

you.

[Operator]

Thank

you

very

much,

and

my

apologies,

Mr.

Artur.

Your

next

question

comes

from

Filipe

Leite

from Caixabank

BPI (sic) [BPI Caixabank] (00:19:20).

Please

go

ahead.

[Filipe Leite, Analyst, BPI Caixabank]

Hi. Hello,

everyone.

I

have

three

questions

if

I

may.

The

first

one

regarding

EGF

and

if

you

can

give

us

more

detail

regarding

the

ongoing

negotiations

for

the

new

regulatory

period

which

I

believe

it's

from

2022

to

2024

namely

what

is

the

RAB

and

we

turn

on

RAB

that

you

are

expecting

or

that

you

are

proposing

to

the regulator?

Second

question

on

Factoring,

Leasing

and

Confirming

that

reached in

2021

a

historical

high-level

of

26%

of

top line

and

they have

been

increasing

significantly

in

the

recent

years.

I

understand

that

this

is

partially

or

at

least

partially

related

with

the

mining

contract. But

can

you

give

us

what

should

be

the

level

of

Leasing,

Factoring

and

Confirming

that

you

are

comfortable

with?

I

mean

should

we

assume

that

in

terms

of

percent

or

a

percentage

of

top

line,

this

amount

will

continue

to

increase

or

it

will

remain

in

the

upcoming

years

at

roughly

the

same

level

reported

in

2021.

And

last

one

is

on

the

pro-forma

figures

that

you

present

on

page

26.

If

you

can

tell

us

what

is

included

in

capital,

the

subsidiary

capital

which

had

more

than

€140

million

top

line

and

€9

million

EBITDA.

And

also

the

reasons

for

the

other

contribution

in

terms

of

EBITDA

standing

at

minus

€24

million

this

year

when

in

2020 it

was

only

€7

million?

Thank

you.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Hi,

Filipe.

How

are

you?

[Filipe Leite, Analyst, BPI Caixabank]

Fine.

Thank

you.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

No. No. Five. Okay.

Okay.

Three

questions.

First

of

all,

EGF,

okay,

of

course,

we

are

in

a

process

of

renegotiation

of

the

future,

the

next

period,

regulatory

period

of

EGF.

As

you

know,

we

change

the

conditions

dramatically

[audio gap]



(00:22:05)

this

ending

period,

which

was

a

very

important

significant

capacity

of

the

company

to

show

to

the

regulator

that

we

were

right,

that

he

was

not

at

that

time.

I

think

our

main

ideas

was

very

well-accepted

by

the regulator.

I

think

now

the

company,

which

is

serving the

public

interest

company,

it's

a

provider

of

a

public

service.

These –

our

ideas,

our

figures,

investment

are

much

more

aligned

with

the

regulator

now

after

this

very

troubled

discussion

than

was

before.

So,

our

expectation

for

the

renegotiation

of

the

next

regulatory

period

are

very

aligned

with

our

goals.

As

you

can

understand,

like

I

cannot

disclose

the

details

of

that

negotiation

because

I

think

we'll

have

the

final

outcome

of

the

decision

in

the

middle

of

this

year.

So,

more

than

saying

that

we

will

be

aligned

with

the

actual

performance

of

EGF

Group.

I

cannot

more

detail

from

that

negotiation.

Factoring,

Confirming

and

Leasing,

yes

we

are

comfortable

with

the

level

of

these

financial

instruments.

It's

very

important

to

finalize

that

to

highlight

that

Leasing,

it's

a

very

important

instrument

for

some

contracts

in

which

we

amortize

all

the

equipment

during

the

delay

or

the

period

of

that

contract.

So

it make

a

lot

of

sense

to

have

confined

those

equipments

with

a

specific

[audio gap]



(00:24:12) r

to

align

totally

the

equipment,

the

contract

and

the

period

of

the

payment.

So

it's

for

us

make

a

lot

of

[audio gap]



(00:24:22).

And

of

course

we

should

use

more

this

instrument

in

contracts

that

allow

the

capacity

to

pay

during

the

same

period.

The

other

question

which

is

relevant

to

Confirming. The

Conforming

it's

not

an instrument,

a

financial

instrument, it's

a

very

short-term

financial

instrument

but

normally

we

don't

use

a

lot.

What

is

new

this

year?

This

year,

when

we

start

in

Train

Maya

and

mainly

in

Train Maya,

the

client

paid

or

proposed

to

pay

an

advance

payment

by

having

a

[audio gap]



(00:25:24)

to

a

down

payment,

but

I

put

a

public

bank

to

give

–

[audio gap]

(00:25:32)

that

during as

was

an

amortizing

of

down

payment

is

why

the

Confirming

increase

in

such

an

expressive

amount.

And

for

that

we

clarify – it

was

important

to

clarify

how

we

deal

with

Confirming

when

the

value

became

to

be

more

material

that

was

before

and it does not

make

any

sense

not

treat

Conforming

like

a

Factoring

and

the

Leasing.

I

think

it's

more

much

more

short-term

than

the

other

than

much

more

not

linked

with

real

debt

than

was

the

other.

What

– If

you

want

to

compare

this

year

with

last

year,

the

Confirming

in

2020

was –

I

don't

have

the

figure

here

but

it should

be

immaterial.

€15

million,

€20

million,

something

like

that,

you

can

check

that

on

balance

sheet.

I

don't

– it's

not

material.

The

point

– the

last

question,

I'm

so

sorry

but

I

missed

that.

Can

you

repeat?

Can

you

be

so

kind to...

[Filipe Leite, Analyst, BPI Caixabank]

Yeah.

Yeah.

So

basically,

looking

at

the

presentation

on

page

26,

you

are

providing

a

pro-forma

information

and

my

question or

what

I

would

like

to

understand

is

what

activities

are

included

in

capital

which

report

€142

million

top

line

in

2021.

And

the

reason

for

the

other

and

intercompany EBITDA

with

minus –

or

a

contribution

of

minus

€29

million

at

everything

2021

when

in

the

previous

year,

it

was

only

€7

million

negative?

[Gonçalo Nuno Gomes de Andrade Moura Martins]

First

of

all

in

capital,

we

have

some –

not

related

with

concessions

because

we

don't

consolidate

in

terms

of

turnover

or

EBITDA

consolidation. What

is

clear

is

mainly

the

facility

services,

the

landscape

company

that

we

have

which

were

initially

integrated

in

the

Construction

area

but

that

are

not

anymore.

So

basically

this

turnover

coming

from

there

is

some

real

estate

that

we

still

have

which

is

not

expressive

as

you

know.

And

the

margins

is

that

the

difference

of

intercompany,

others;

I

really

don't know.

I

will

check

and

send

to

you

later

on.

Because

of

course

when

we

are

doing

such

change

in

the

perimeter

and

the

way

that

we

aggregated

the

businesses

as

we

are

doing

now,

perhaps some

difference are

higher

for

that

reason

but

I

will

check

and

share

with

you

as

soon

as

possible.

Sorry

for

that.

[Operator]

Thank

you. Thank

you

very

much.

[Operator Instructions]



Thank

you.

Your

next

question

comes

from

Daniel

Gandoy

from

JB

Capital.

Please

go

ahead.

[Daniel Gandoy Lopez]

Yes.

Good

afternoon

everyone.

Thank

you

very

much

for

taking

my

questions.

Two

if

I

may.

The

first

one

is

if

you

could

provide

us

with

more

color

on

the

guidance

for

2022,

either

by

geography

or

by

division?

And

the

second

question

relate

to

the

working

capital

trends

in

2022.

If

what

should

we

expect

in

terms

of

working

capital

to

revenues,

if

we

should

expect

something

similar

to

this

year,

close

to

breakeven

and

then

further

increase

of

the

Confirming,

Leasing

and

Factoring

lines? Thank

you.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Hi,

thank

you

for

your

questions.

First

of

all

related

with

the

guidance, it's

much

less

that

we

have

here

on

the

slide

22.

Of

course,

depending

on

regions

and

depending

on

markets,

we

will

be

more

focused

in

turnover

or

margin

to

be

totally

clear.

Of

course

for

instance

in

Europe,

we will

be

much

more

focused

on

margin,

consolidating

these

good

margins

that

we

are

having

in

such

a

mature

markets

than

in

turnover.

Of

course

we

have

a

large

backlog

to

perform

in

Africa.

So,

in

Africa

I hope

that

we

can

increase

our

activity

and

surpassing

for sure

the

€1

billion

turnover

next

year.

And

Latin

America,

we

will

be

more

focused

of

course

in

consolidating

the

good

margins

that

we

have

this

year

rather

than

grow

expressively

I

would

say.

Basically

it's

that.

I

don't

know

if

you

want

more

details

than

that

because

our

indication

is that

we

are

going

to

have

sound

activities

going

further

next

year.

All the

indicators

that

we

have,

we

have

already

the

first

months

of

the

year

closed

and

that's

what

it indicates.

Basically,

we

have

more

activity

to

perform

in

Africa

than

we

have

in

the

other

two

regions.

But

of

course

we

have

to

consolidate

these margins

that

we

have

in

the

other

two

markets.

I

mean

the

other

two

regions;

Europe

and

Latin

America.

The

second

question

was

about

[audio gap]

(00:32:23).

I

think

we'll be – the ratio will

be

a

little

bit

worse

than

[audio gap]

(00:32:33)

this

year

because

we

are

going

to

speed

up

the

activity

in

Africa

and

normally

that will

be an effort

of

working

capital

more

than

we

were

able

to

manage

this

year.

Just

you

to

know

that,

as

you

know

we

have

a

indication

in

our

business

plan

of

a

7%

that

we

– let's

see

if

it

is

less

of

working

capital

on

turnover.

So

I

think

that

will

be

different

towards

this

year.

[Daniel Gandoy Lopez]

Okay.

Thank

you very

much.

[Operator]

Thank

you.

The

next

question

comes

from

João

Safara

from

Banco

Santander.

Please

go

ahead.

[João Safara Silva, Analyst, Banco Santander SA]

Yes.

Hi,

good

afternoon.

Thank

you

for

taking

my

question.

I

have

two.

The

first

one

regarding

the

down

payments

this

year,

can

you

can

you

quantify

how

much

have

you

received

in down

payments?

You

started

some

very

large

projects,

so

could

you

give

us

an

idea

of

how

relevant

there

was

for

the

sound

working

capital

performance?

And

then

the

second

question

and

I

just

wanted

to

have

your

view

on

the

backlog,

specifically

on

countries

that

are

oil-driven,

I'm

just

thinking

mostly

about

Angola

and

Mozambique

and

I

mean

if

you're

seeing

an

uptick

in

terms

of

the

backlog

in

those

two

countries.

And

specifically

in

Mozambique,

if

you

could

give

us

some

color

on

the

LNG

project;

the

project

as

it

restarted,

are

we

seeing

more

potential

new

contracts

coming

in

and

are

you

bidding

also

for

those

projects

so –

any

color

on

this

would

be

very

helpful.

Thank

you

very

much.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Hi,

João,

how

are

you?

[João Safara Silva, Analyst, Banco Santander SA]

I'm

very

good.

Thank

you.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Nice,

nice.

The

first

question

is

the

amount

of

down

payments

received

last

year

was

around

€390

million or

something

like

that.

I

don't

have

the

precise

figure

but it

was

on

that

level.

Regarding

the

second

question

of

course

we

are.

This

crisis,

this

new

crisis

that

we

are

living

in

with

this

war

in

Europe,

of

course

will

affect

dramatically

the

balance

between

the

demand

and

the

offer

in

the

[indiscernible]



(00:35:50) market.

What

will

happen

with

the

Russian

will

change

a

lot

the

shares

of

the

energy

market in

the

world,

and

of

course

new

sources

of

oil

and

new

sources

of

gas,

mainly

gas,

will

be

very,

very

important.

As

you

know,

in

the

north

of

Mozambique are

the

biggest

proven

reserves

of

natural

gas

in

the

world

and

of

course

the

project

was

suspended

by

Total.

It's

one

of

the

major

players

because

of

the

rebels

and

the

attacks

of

the

rebels

and

the

small

war

that

is

going

on

there.

Of

course,

now

it's

much

more

controlled.

Total

last

week

reinforced

their

full

interest

on

the

project

and

how

would

– that

project

is

important

because

every

–

all

the

Western

companies,

oil

and

gas

are

selling

their

assets

and

their

stakes

in

the

oil

and

gas

business

in

Russia.

So they will

[audio gap]



(00:37:03) of

gas for instance.

So

–

but

of

course

the

request

of

Total

was

that no

[audio gap]



(00:37:13) can

be

happening

for

three

months

or whatever.

I

don't

remember

exactly

the

period

but

they

fixed

to

the

Mozambican

government

very

clear

conditions,

safety

conditions

in

order

re-assume

the

project.

As

you

know,

there

was

a

totally

change

in

the

Mozambican

government

this

week.

They

changed

a

lot

of

ministers,

including

the

inclusive

the

Prime

Minister

in

order

to

create –

I

don't

know

why

but

some

of

them

was

– the

state

or

the

government

was

not

satisfied

with

the

creation,

the

speed

of

the

creation

of

conditions

for

– we

assume

the

gas

project.

We

have

a

project

which

is

suspended,

a

big

one.

We

have –

the

project

was

not

cancelled,

the

contract

was

not

cancelled

with

ourself

and

our

JV.

The

project

was

only

suspended.

So

we

are

very

keen

to

understand

that

the

project

could

be reassumed

and

going

[indiscernible]



(00:38:30)

more

of

course

work

for

all

sides

because

we

have

very

specific

conditions

and

special

conditions

to

address

that

big,

big

project.

If

of

course –

we

sign

important

contracts

of

energy

in

Uganda

in

the

beginning

of

the

year,

January

and

February,

already

for

Total

as

well.

So, we

are having

a

very

good

relation

with

Total

as

a

client

which

is

important.

And

of

course,

as

you

can

imagine,

the

budget

in

Angola,

was

then

based

on

an

oil

price

of

$40

per

barrel

[indiscernible]



(00:39:15)

more

than

$220.

Now

the

barrel

– the

oil

delivered

on

May

is

already

selling – is

sold

–

selling

price

of

the

oils

to

be

delivered

on

May

$221

now.

So,

of

course

that

will

provide

much

more

capacity

of

those

countries

to

invest

and

of

course

to

have

a

much

more

sound

but

a

public

budget

for

the

coming

years

I

would

say.

So,

of

course

the

war

is

a

terrible

thing

to

happen.

But

of

course,

there

is

a

lot

of

collateral

damage

and

consequence

of

those

terrible

events.

And

of

course,

one

of

them

is

changing

in

the

energy

sector

and

of

course

that

will

generate

a

lot

of

work.

Not –

even

perhaps

here

in

Portugal

as

people

are

discussing

in

[indiscernible]



(00:40:24)

and

other

places,

so

a

lot

of

things

will

happen

in

the

near future.

[João Safara Silva, Analyst, Banco Santander SA]

Thank

you

very

much

for

the

details.

[Operator]

Thank

you.

[Operator Instructions]



There

are no

further

questions.

Ladies

and

gentlemen,

I

will

now

pass

the

floor

to

our

speakers.

[Pedro Arrais, Head-Investor Relations, Mota-Engil SGPS SA]

So

thank

you

for

all

the

questions.

So we

will

make

the

final

stage

of

this

presentation.

Look

into

the

slide

22

where

we

can

see

the

outlook

the

guidance

for

this

year

to

do, what we wanted to do

with

the

turnover,

expected

to

increase

high

single-digits

for

the

full-year

with

the

EBITDA

margin

in-line

with historical

margins.

We

increased

considering

the

strong

development

of

our

backlog

we

increased

the

goal

for

2022

for

stand

backlog

level

above

€7

billion

with

relevant

projects

in

pipeline.

The

CapEx

in

range

of €250

million

to

€300

million,

in-line

what

we

presented

in

the

strategic

plan,

Building

2026.

And

we

will

maintain

our

focus

in

our

financial

strategy

to

have

a

focus

on

organic

cash

flow

generation

and

debt

reduction

proceeding

with

the

strengthening

of

the

capital

structure

and

diversifying

funding

sources

and

extending

debt

maturities.

In

the

final

slides

of

the

slide

23

is

a

sum-up

of

the

year

of

2021

and

2022 and

we

want

to

leave

you

the

main

message

that

we

would

like

you to

retain

that

our

operations

are

back

on

track

after

the

pandemic.

And

with

the

challenging

crises,

the

company

achieved

a

very

important

strategic

agreement

with

CCCC

to

operate

globally

with

one

of

the

leaders

worldwide

of

the

industry.

We

presented

in

November

the

new

strategic

plan,

Building

2026

and

showing

in

the

second-half

of

2021

a

strong

performance

that

supports

a

positive

outlook

from

2022

onwards.

In

this

sense,

in

this

year

of

2022,

the

company

will

be

focused

on

executing

the

backlog.

Nevertheless,

always

looking

to

good

opportunities

that

could

promote

synergies

and

profitability

to

the

group

considering

a

[audio gap]



(00:44:05) a

long

period

of

preparation

of

the

new

strategic

plan,

the

company

and

our

teams

are

prepared

to

target

with

sustainability

as

a

priority

in

our

agenda.

Thank you very much for your presence.

[Gonçalo Nuno Gomes de Andrade Moura Martins]

Thank

you.

Thank

you

all.

Bye-bye.

[Operator]

Ladies

and

gentlemen,

thank

you

for

your

participation.

You

may

now

disconnect

your

lines.