Ferrovial SE(US:FER)2026-02-25 22:13Corporate Reorganization and Trading - The Group underwent a corporate reorganization on June 16, 2023, resulting in the re-domiciliation from Spain to the Netherlands and the dissolution of Ferrovial, S.A.[19] - The ordinary shares of Ferrovial SE began trading on Euronext Amsterdam and the Spanish Stock Exchanges on June 16, 2023, and on the Nasdaq Global Select Market under the symbol "FER" on May 9, 2024[19]. Financial Reporting and Performance - The financial information in the Annual Report includes audited consolidated financial statements for the years ending December 31, 2025, 2024, and 2023, prepared in accordance with IFRS-IASB[21]. - The Group's performance is reported using both IFRS measures and non-IFRS measures to provide a comprehensive view of its financial health[23]. - The Annual Report includes forward-looking statements that are subject to risks and uncertainties, and actual results may differ materially from those projected[30]. Risks and Uncertainties - The Group faces risks related to geopolitical uncertainty, economic contraction, and reliance on public and private sector projects, which could impact funding availability[40]. - The business is exposed to risks from a small number of major projects, competition in the global market, and potential delays or terminations of these projects[40]. - The Group's operations are subject to risks from accidents, contractual disputes, and the reliability of subcontractors and service providers[40]. - The financial condition and performance of joint ventures and partners pose liquidity-related risks, including limitations in accessing capital markets[40]. - The Group is exposed to complex tax laws and potential volatility in share price, which may affect future dividend payments[40]. - The company faces risks from geopolitical unrest, which could adversely affect business operations and financial condition[48]. - Changes in financial, economic, and tax policies may adversely impact project volume, affecting the company's business and financial results[69]. - Climate change poses physical and transitional risks that could adversely affect infrastructure and project development, impacting financial performance[82]. - The company faces potential penalties or early termination of contracts if expected performance levels are not met, which could adversely affect financial results[122]. - The company is exposed to risks from cyber threats and technology failures, which could materially affect operations and financial results[129]. - The company is subject to risks related to joint ventures and partnerships, which could adversely affect its financial position and results of operations[168]. - The company is exposed to litigation risks that could materially affect its reputation and financial condition, with ongoing legal proceedings being a significant concern[164]. Revenue and Financial Metrics - Revenue generated in Poland accounted for 23.3% of total revenues in 2025, with no material impact from the ongoing conflict in Ukraine[49]. - Clients from the public sector represented 84% of the total Order Book in the Construction Business Division in 2025[73]. - The balance of TIFIA loans as of December 31, 2025, was USD 2,386 million, indicating reliance on government funding for infrastructure projects[72]. - A 10% appreciation in major currencies against the euro would impact equity attributable to shareholders by EUR 382 million, with 43% from the Canadian dollar[59]. - 97% of the company's indebtedness is hedged, with the remaining 3% linked to variable rates, exposing the company to interest rate fluctuations[63]. - High inflation combined with low economic growth could significantly impact demand in airports and highways, affecting revenue from tolls and airfares[54]. - The company reported a revenue of CAD 41 million for Schedule 22 payments due in 2026, reflecting minimum traffic thresholds not being met in 2025[116]. - As of December 31, 2025, the balance of performance guarantees amounted to EUR 7,939 million, down from EUR 8,260 million in 2024[123]. - The company reported total dividends received from infrastructure assets amounted to EUR 968 million for the year ended December 31, 2025, with EUR 467 million from consolidated entities (48.2%) and EUR 501 million from equity-accounted companies (51.8%)[172]. Operational Challenges and Market Conditions - The construction sector is experiencing low profitability margins due to aggressive commercial strategies and cost inflation[95]. - Competition in the U.S. toll road investment market is expected to intensify in 2026-2027, with several projects entering the procurement phase[93]. - The company may experience adverse effects on financial performance due to construction delays and cost overruns in significant projects like NTO[108]. - The lack of investment opportunities in certain geographies has increased competitive pressure, impacting prices and profit margins[94]. - Increased demand for skilled labor in key markets may impact the company's ability to attract and retain talent, potentially affecting competitiveness and profit margins[135]. - The company operates in highly regulated environments, and changes in regulations could lead to increased costs and operational challenges[76]. - The company anticipates ongoing legal complexity regarding international data transfers, which may require changes in business operations and incur additional costs[148]. Financial Management and Capital Structure - The company’s ability to secure financing on favorable terms is critical for its growth, particularly in capital-intensive sectors like airports and highways[178]. - The company’s financial condition may be adversely affected by increased risks of late payments from public sector clients due to financial stress in Europe[180]. - The company’s quarterly financial results may fluctuate significantly due to factors such as seasonality and internal contract reviews, making period-to-period comparisons challenging[202]. - The company has refinanced its revolving credit facility and bond maturing in 2025, extending the maturity to 2031, which is crucial for maintaining liquidity[179]. - The company actively manages credit risk through scoring and insurance, but there is no guarantee that these strategies will fully mitigate exposure[181]. - Future dividend payments will depend on the company's financial condition and results of operations, which could negatively impact the market price of ordinary shares[205]. - The company is a holding entity with no direct cash-generating operations, relying on its operating Group Companies to generate funds for financial obligations and dividend payments[206]. - The Board has discretion over dividend declarations, which may be influenced by capital requirements, earnings levels, cash position, and overall financial condition[207]. - Dividend payments may vary and are contingent on the company's ability to generate profits and cash flow available for distribution[208]. - The Board is authorized to issue shares or grant rights to subscribe for ordinary shares up to 10.0% of issued share capital for corporate purposes and 5.0% for scrip dividends, limiting pre-emptive rights[209]. - Dividends from infrastructure assets may fluctuate significantly due to factors like project debt refinancing and traffic levels[210]. - Shareholders outside the Netherlands and Spain may face restrictions on participating in future equity offerings, potentially leading to dilution[211]. - The company may offer a share dividend election to shareholders, but restrictions may apply based on jurisdiction, affecting the ability to receive dividends in shares[212]. - The company's ordinary shares are listed on multiple exchanges, which may adversely affect liquidity and share price due to trading in different currencies and time zones[213].