Core Points - The new highway project, spanning over 168 kilometers, will enhance urban development space by over 900 square kilometers, linking cities and promoting regional growth [6][16] - The expansion of the G98 Ring Road in the Sanya section aims to alleviate traffic congestion, with expected daily traffic volume increasing to 300,000 vehicles [6][9] - The project is the largest single investment in highway construction since Hainan's establishment as a special economic zone, with a total investment of approximately 31.8 billion yuan [13] Traffic Improvement - The new highway will feature a dual six-lane design, significantly increasing traffic capacity and efficiency [9] - Current traffic on the Sanya section exceeds 62,000 vehicles daily, with peak holiday traffic surpassing 150,000 vehicles, indicating a state of "overload" [7][9] - The project includes six new connecting lines totaling 46.366 kilometers, facilitating efficient traffic flow between the existing and new highways [9] Environmental Considerations - The construction will prioritize ecological preservation, with 113 bridges and 11 tunnels planned to minimize land use and environmental impact [11][12] - The project aims to reduce land occupation by over 2,000 acres compared to traditional road construction methods [11] - The initiative will utilize over 7 million cubic meters of excavated material, promoting resource recycling and minimizing environmental disruption [11] Technological Integration - The project employs advanced digital management systems for real-time monitoring and efficient construction management [14] - Smart control systems have been integrated into various construction phases to ensure safety and quality [14] Economic Impact - The highway is expected to enhance regional economic integration and support the development of a "highway + urban expressway" transportation system [15] - It will facilitate the transportation of agricultural products from the region, benefiting local farmers and contributing to economic growth [15][16] - The project is strategically significant for the Sanya economic circle, enhancing connectivity and fostering collaboration among various sectors [16]

Core Insights - Ferrovial reported significant growth in the first nine months of 2025, with substantial revenue increases across all business divisions [1][15] - Adjusted EBITDA reached €1 billion, reflecting a 4.8% year-over-year increase, while total revenue was €6.9 billion, a 6.2% rise [3][9] Financial Performance - Adjusted EBITDA for the first nine months of 2025 was €1,031 million, up from €1,008 million in the same period of 2024, marking a 4.8% increase [3][9] - Total revenue increased to €6,911 million from €6,643 million, representing a 6.2% rise [9] - The company maintained a strong financial position with liquidity of €4.2 billion and consolidated net debt of -€706 million, excluding infrastructure projects [4] Business Division Highlights - The Highways division saw a revenue growth of 14.4% to €1 billion, driven by strong performance in North America, which contributed €312 million in dividends [5][6] - The Construction division's order book reached €17.2 billion, with North America accounting for 47% of the total [7] - The Airports division is progressing with the New Terminal One project, having secured 21 commercial agreements with airlines [7] Dividends and Shareholder Returns - The 407 ETR announced an additional dividend of CAD 1.05 billion for the last quarter of the year, bringing the total approved dividends to CAD 1.5 billion [6] - Ferrovial allocated €426 million to shareholder distributions during the reporting period [4]

Financial Performance Overview - Ferrovial achieved strong performance across all business divisions in 9M 2025[7] - The company's net debt ex-infrastructure projects was -€706 million[7] - Revenue increased to €6,911 million, a 6.2% like-for-like (LfL) increase compared to 9M 2024[47] - Adjusted EBITDA reached €1,031 million, a 4.8% LfL increase compared to 9M 2024[47] - Adjusted EBIT amounted to €691 million, a 6.0% LfL increase compared to 9M 2024[47] Highways Division - US Highways revenue increased by 16.4% LfL compared to 9M 2024[12] - US Highways adjusted EBITDA increased by 15.1% LfL compared to 9M 2024[12] - North American assets contributed €312 million in dividends[12] - 407 ETR's revenue increased by 19.3% to CAD 1,511 million in 9M 2025[15] - 407 ETR's EBITDA increased by 15.8% to CAD 1,283 million in 9M 2025[15] - A Q4 dividend of CAD 1.05 billion was approved for distribution from 407 ETR, a 50% increase compared to CAD 700 million in Q4 2024[21] Construction Division - Construction revenue reached €5,420 million, a 4.6% LfL increase compared to 9M 2024[40] - The construction division's order book stood at €17,168 million, a 9.1% LfL increase[45]

Core Viewpoint - The news highlights the achievements of Dezhou's transportation sector during the "14th Five-Year Plan" period, emphasizing the development of a modern and comprehensive transportation network that enhances connectivity and supports economic growth [3][4][6]. Transportation Infrastructure Development - The city has significantly increased investment in transportation infrastructure, aligning with the national strategy for a strong transportation network [3]. - The railway network has expanded to 417 kilometers, including 197 kilometers of high-speed rail, forming a "three vertical and four horizontal" railway layout that improves access to major urban areas [3]. - The completion of the Jizheng High-Speed Railway and the accelerated construction of the Tianwei High-Speed Railway are notable developments [3]. Road Network Expansion - The total length of the road network has reached 22,000 kilometers, with a density of 213.6 kilometers per 100 square kilometers, ranking fourth in the province [4]. - A comprehensive highway network has been established, including 10 new highways under construction, resulting in a total of 594 kilometers of expressways, placing Dezhou sixth in the province [4]. - Significant improvements have been made in rural road infrastructure, with 3,939 kilometers of rural roads newly constructed or renovated, achieving 100% accessibility for villages [4]. Airport and Water Transport Development - The planning of a modern airport cluster in Dezhou includes one main airport and 12 general airports, with ongoing site selection for a civil transport airport [6]. - The existing Pingyuan General Airport is operational, while the Qingyun General Airport is under construction [6]. - A comprehensive inland waterway network is being planned, consisting of one vertical and two horizontal routes, with ongoing feasibility studies [6].

Core Viewpoint - The era of free highways may be quietly approaching, extending beyond just holiday benefits, as multiple highways in regions such as Sichuan, Chengdu, and Guangzhou have announced free access, covering significant areas in the Yangtze River Delta, Pearl River Delta, and Southwest China [1] Group 1 - Several highways in Sichuan, Chengdu, and Guangzhou have declared free access [1] - The initiative covers important regions including the Yangtze River Delta and Pearl River Delta [1] - The trend suggests a potential shift towards a more permanent free highway system rather than just temporary holiday benefits [1]

Core Viewpoint - Sichuan Expressway's 1H25 results show a decline in revenue but an increase in net profit, aligning with expectations, indicating resilience amid challenging conditions [1][2]. Financial Performance - Revenue decreased by 23.14% YoY to Rmb4,126 million in 1H25, with a net profit attributable to shareholders rising by 19.93% YoY to Rmb837 million [1]. - In 2Q25, revenue fell 32.17% YoY to Rmb2.28 billion, while net profit attributable to shareholders increased by 24.2% YoY to Rmb381 million [1]. - Toll revenue slightly decreased by 2.25% YoY to Rmb2.27 billion in 1H25, with mixed performance across core road assets [1][2]. Expense Management - Financial expenses decreased by 31.0% YoY, and general and administrative expenses fell by 14.8% YoY, contributing to profit through cost reduction and efficiency improvements [2]. Growth Potential - The expansion of Chengle Expressway is nearing completion, and Chengya Expressway has secured an expansion bid, expected to allow for higher toll rates and longer tolling periods [3]. - The acquisition of the Second Ring (Western) Expressway is projected to contribute Rmb160 million in profit in 2025, along with a cumulative compensation of Rmb31.48 million for 2023-2024 [4]. Shareholder Returns - The company emphasizes shareholder returns, with a dividend payout ratio not lower than 60% for 2023-2025, leading to a 2024 dividend yield of 6.4%, one of the highest in the highway sector [5]. - Estimated dividend yields for 2025 and 2026 are projected at 7.0% and 7.4%, respectively, indicating attractive returns [5]. Valuation - A-shares are trading at 10.9x 2025e and 10.4x 2026e P/E, while H-shares are at 8.6x 2025e and 8.1x 2026e P/E [6]. - Target prices are set at Rmb6.85 for A-shares (implying 13.3x 2025e P/E) and HK$5.61 for H-shares (implying 10.0x 2025e P/E), with respective upsides of 21.9% and 16.4% [6].

Group 1 - The meeting on August 11 between Agricultural Bank of China (ABC) Hunan Branch and Guizhou Transportation Investment Group focused on financing services for the G9907 Liuyang Shashi to Ningxiang Expressway project, marking significant progress in project implementation after the bid results were announced on July 23 [1][3] - The collaboration emphasizes the strategic synergy of "financial leadership and capital empowerment," establishing a solid financial foundation for the project's successful execution [1][3] - Both parties discussed project initiation and financing needs, expressing intentions to deepen cooperation in key projects and business areas, aiming for mutual benefits and shared development [3] Group 2 - The G9907 Liuyang Shashi to Ningxiang Expressway project spans approximately 92.62 kilometers, starting from Shashi Town in Liuyang and connecting to various highways, designed for a speed of 120 km/h with a dual six-lane standard [5] - The project includes 85 bridges totaling 40,929 meters and 3 tunnels measuring 6,222 meters, with a bridge-tunnel ratio of 51%, and features 13 interchanges, including 7 hub-style interchanges [5] - The project is a key component of the National Highway Network Planning for the Changsha-Zhuzhou-Xiangtan urban agglomeration and is included in Hunan Province's 14th Five-Year Plan for transportation development [5]

Core Points - The Wuhan to Songzi Expressway (Wusong Expressway) has officially opened its Wuhan section, marking a significant milestone in the city's transportation infrastructure with the total expressway mileage in Wuhan exceeding 1,000 kilometers [1][2] - The Wusong Expressway is a key transportation project during the 14th Five-Year Plan in Hubei Province, consisting of five segments with a total length of approximately 222 kilometers [1] - The Wuhan section of the expressway is designed to alleviate traffic pressure on existing highways and promote regional economic development, significantly reducing travel time between Songzi and Wuhan to under three hours [2] Summary by Sections Project Overview - The Wusong Expressway includes the Wuhan section, which is 10.888 kilometers long, connecting various districts and featuring seven bridges, including five major ones [1] - The expressway is built to a standard of a dual six-lane highway with a design speed of 120 kilometers per hour and a roadbed width of 34.5 meters [1] Economic Impact - The completion of the Wusong Expressway is expected to enhance the connectivity of the region, providing new momentum for the development of an expressway corridor along the Yangtze River [2] - The travel time from Wuhan to Honghu has been reduced from two hours to one hour following the opening of the expressway [2]

Financial Data and Key Metrics Changes - The company reported a net debt position of negative €223 million, excluding infrastructure project companies, which does not include proceeds from the divestment of Hydro [4] - Adjusted EBITDA for the construction segment was €191 million, up 4.2% year-over-year, with an adjusted EBIT margin of 3.5%, in line with long-term targets [16][17] - Operating cash flow was negative €104 million in the first half, compared to negative €53 million in the same period last year, primarily due to the lack of advanced payments [17] Business Line Data and Key Metrics Changes - Highways revenues grew by 14.9% in the first half on a like-for-like basis, with adjusted EBITDA improving by 17.1% [6] - U.S. Highways represented 88% of total highways revenues and 97% of total adjusted EBITDA, with revenues growing by 15.9% and adjusted EBITDA increasing by 14% [6] - The construction segment saw revenues reach €3,453 million, a 2.6% increase on a like-for-like basis [16] Market Data and Key Metrics Changes - Traffic improved by 5.8% in the second quarter, driven by targeted rush hour promotions, despite adverse weather conditions [8] - At JFK Airport, the new Terminal 1 project is 72% complete, with construction on schedule and on budget [14] - Dalaman Airport in Turkey experienced a slight traffic decline of 0.3% in the first half, impacted by lower domestic passenger volumes [15] Company Strategy and Development Direction - The company continues to focus on growth investments, divestments, and shareholder distributions, with a strong pipeline of U.S. highways assets [4][28] - The strategic horizon plan is being executed, with updates on progress expected [29] - The company is optimistic about future opportunities in Poland, particularly with European funds and potential reconstruction in Ukraine [96] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth prospects of North American assets, driven by increased customer segmentation and local economic growth [28] - The company anticipates limited exposure to inflation and a healthy construction order book [29] - Management noted that adverse weather events negatively impacted performance but did not foresee significant long-term effects [11] Other Important Information - The company completed the acquisition of an additional 5.06% stake in four zero seven ETR for CAD 1.99 billion, increasing its stake from 43.23% to 48.29% [5] - Dividends from North American highways totaled €240 million in the first half, down from €339 million in the same period last year [7] - The company issued $1.4 billion in long-term green bonds, completing the refinancing of phase A for the NTO project [15] Q&A Session Summary Question: Can you explain the strong growth in average revenue per transaction in I-77 and I-66? - Management attributed the growth to increased toll revenues and dynamic pricing adjustments based on traffic behavior and value provided to users [36] Question: Why did earnings from ProBio Construction decline year-over-year in Q2? - Management indicated that the decline was due to additional costs related to utilizations and IT systems, along with increased bidding costs [43] Question: Can you comment on the recent pricing and traffic trends in the U.S. Managed Lanes business? - Management noted that underlying economic growth has been positive, although adverse weather impacted performance in the second quarter [117]

Overall Performance - Ferrovial's net debt ex-infrastructure projects reached -€223 million[7] - Highways, Airports and Construction all showed robust performance[7,9] - Dividends collected from projects totaled €323 million[9] - Shareholder distributions amounted to €334 million[9] Highways - US Highways' revenue increased by 15.9% LfL compared to H1 2024[12] - US Highways' Adjusted EBITDA increased by 14.0% LfL compared to H1 2024[12] - 97% of Highways' Adjusted EBITDA and 88% of Highways' revenue came from US assets[12] - Dividends from North American assets reached €240 million (€339 million in H1 2024)[12] 407 ETR - 407 ETR revenue increased by 19.7% to CAD 933 million in H1 2025[14] - 407 ETR EBITDA increased by 13.0% to CAD 765 million in H1 2025[14] - A CAD 45.2 million provision was accrued for Schedule 22 in H1 2025[17] - A CAD 200 million dividend was paid in H1 2025, a 14.3% increase from CAD 175 million in H1 2024[19] Construction - Construction revenue reached €3,453 million in H1 2025, a 2.6% LfL increase[37] - Construction Adjusted EBIT margin reached 3.5% in H1 2025[37]