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FCC to invest 4 billion euro through 2010

21/05/2008

FCC to invest 4 billion euro through 2010

  • FCC projects 18 billion euro revenue by 2010, 30% more than last year.
  • More than 50% of revenue will be obtained outside Spain.
  • Shareholder value will increase by over 50%.
  • The company will maintain its low leverage.

 

FCC projects 30% growth over the next three years to reach 18 billion euro revenue in 2010, according to the 2008-2010 Strategic Plan presented today by Managing Director and Vice-Chairman, Baldomero Falcones, who estimates that half of revenue will come from overseas activities.

Shareholder value will increase by more than 50%, while maintaining the current indebtedness ratio.

The company, controlled by Esther Koplowitz, who also chairs the Strategy Committee, plans to invest 4.1 billion euro to achieve its objectives.

FCC's management team drafted the 2008-2010 Strategic Plan, which was approved by the Board of Directors on 12 May; it aims to consolidate FCC as a diversified services and infrastructure leader worldwide.

The main objectives of the Plan are:

1. Returns: To increase shareholder value by more than 50%.

2. Leadership: To increase revenue to 18 billion euro (30% more than in 2007).

3. Diversification: Services will be the main source of EBITDA for the group, accounting for more than 50% in 2010.

4. Internationalisation: Revenue from abroad will account for more than 50% of the total.

These goals have been set in an economic context marked by a slowdown in the developed economies, contrasting with growth in emerging economies, with financial and capital markets that are more constrained, leading to higher financing costs.

The growing demand for investment in transport and services infrastructure in developing and emerging countries, and increasing concern for the environment, recycling, and water management will alleviate the deceleration in residential construction and sales in Spain and the US.

FCC has launched three strategic projects which call for a total investment of more than 4 billion euro:

1. To consolidate current businesses while maintaining its leading position and share in the markets where it operates, and strengthen and integrate acquisitions made in the last few years. The Group projects a 1.4 billion euro investment to strengthen its current businesses.

2. To take advantage of growth opportunities in services and infrastructure in strategic areas such as the UK, Central and Eastern Europe, the US, Mexico, and emerging countries. The Group will invest 2.6 billion euro in acquisitions and development in 2008-2010. FCC expects to diversify into energy, focusing primarily on cogeneration, energy efficiency and renewables.

3. To increase efficiency, talent management and cost optimisation within the group.

The Strategic Plan also aims to maintain and improve the company's capacity and solvency by keeping its debt below 3 times EBITDA in the 2008-2010 period.

It will also concentrate on maintaining strict financial discipline, generating cash flow, internationalising its funding sources, and strengthening its relationship with investors.

FCC would like to be recognised by the society it serves and for its contribution to sustainable development. The 2008-2010 Strategic Plan will promote corporate responsibility, transparency and corporate governance initiatives to enable the company to achieve its goals.