Ferrovial N.V. (FER) 2026 Q3 法說會逐字稿

You are now in the main conference.

Good afternoon, everybody. This is Silvia Ruiz speaking. I would like to welcome you to Ferrovial's conference call to discuss the company's operating results for the third quarter of 2026 and the specific presentations from Recent Awards in Nashville and Atlanta.

I'm joined here today by our CEO, Ignacio Madridejos, and our CFO, Ernesto Mozo. Just as a reminder, the presentations and the results report are available on our website. At the end of the presentation today, there will be a Q&A session. (Event Instructions)

Before starting, please take a moment to look at the safe harbor statement included in the presentation. And please bear in mind that the presentation contains forward-looking statements and expectations that are subject to certain risks and uncertainties, so actual figures may differ.

During this call, we will also discuss non-IFRS financial measures, which are defined and reconciled to the most comparable IFRS measures in our results report and in our website. With all this, I will hand over to Ernesto to cover the third quarter operating results. Ernesto, the floor is yours.

Thank you, Silvia, and good morning or good afternoon, everyone. Thank you for joining us today to review Ferrovial's operating results for the first 9 months of 2026. Overall, the first 9 months of 2026 showed a strong growth across our core businesses particularly Highways and Construction. In Highways, 407 ETR delivered robust revenue growth despite lower traffic, while all our use managed lanes posted double-digit growth in revenue per transaction.

Construction continued to improve profitability, with the adjusted EBIT margin reaching 4.1% in the first 9 months. In airports, March 2027 remains [that Phase DBO ] which is subject to, among other factors, contractor fulfillment of the remediation plan submitted to the authority. In terms of cash, we closed September with a net cash position of EUR1,660 million, EUR1.66 billion, excluding infrastructure project companies. The primary sources of cash were EUR604 million of dividends from projects and EUR591 million of construction operating cash flow, excluding tax payments and dividends. We also received EUR96 million from divestments, mainly Silvertown Tunnel and Trans Chile.

The main cash outflows included a EUR63 million equity contribution to New Terminal One and EUR461 million related to the cash dividend and treasury share purchases. Regarding recent developments, our consortium was awarded I-24 Southeast Choice Lanes in Nashville and reached commercial close in September. In October, we were also awarded I-285 East Express Lanes, and our consortium was selected to deliver the D35 Highway P3 project in the Czech Republic. Additionally, we have announced the second (inaudible) dividend for an aggregate amount of EUR600 million payable in cash or Ferrovial shares at the election of our shareholders. Let's move now to the 407 ETR.

The 407 ETR delivered solid revenue growth in the period despite lower traffic. In the first 9 months, revenue grew by 18.4%. Toll revenue growth was primarily driven by higher toll rates which went into effect on January 1, 2026. EBITDA grew by 21% in the first 9 months. This includes a Schedule 22 payment provision of CAD12.6 million compared with CAD3.4 million last year.

In the third quarter, EBITDA grew by 15.8%, impacted by the CAD7.1 million provision recorded in Q3 2026 and this compares with CAD9.8 million recovery of reversal in the Q3 2025. Excluding the scheduled 2 payment effect in both periods, EBITDA grew 19.4% in Q3 and 18.7% for the first 9 months. Traffic declined 7.1% in the third quarter. When looking at the year-on-year comparison, it is important to bear in mind the different promotional approach with more targeted promotions in 2026 compared with 2025. Traffic was also affected by slower economic growth, particularly impacting heavy vehicles in sectors exposed to tariffs and discretionary trips.

DDP in the region is almost flat in 2026, but major Canadian banks expect growth between 1% to 2% in 2027. Also affecting traffic were unfavorable weather, the timing of holidays and lower maintenance activity and alternative growth. Dividend distributions remained strong. 407 ETR distributed CAD1.05 billion during the first 9 months and a further CAD1.05 billion dividend was approved for the fourth quarter. This brings total dividends approved in 2026 to CAD2.1 billion compared to CAD1.5 billion in 2025.

And now covering Dallas-Fort Worth Managed Lanes in the next slide. The managed lanes continue to show solid demand and a strong operating performance despite construction works and capacity constraints in parts of the network. In terms of operating results, the 3 projects posted solid growth versus last year, both in terms of revenue and EBITDA despite the increase in revenue share.

Looking at each of the assets. At NT, Traffic declined by 2.5% in the quarter and 2.2% in the first 9 months, reflecting the impact from capacity improvement works. This works opened to traffic ahead of schedule on September 25. We except for 2 additional ramp projects that remain under construction. Despite lower traffic, NT revenue grew by 14.8% in the first 9 months.

Adjusted EBITDA increased by 12.3% year-to-date, and it was impacted by $9.8 million of revenue share. At LBJ traffic trends improved significantly after completion of the I-635 feeder corridor reflecting greater utilization of the managed lanes. Transactions increased 5.6% in the quarter and 3.9% in the first 9 months. Revenue grew 16.3% with adjusted EBITDA up 15.9% in the first 9 months. At NTE 35 West, transactions declined 1.1% in Q3 and 0.2% in the first 9 months.

Traffic performance was affected by capacity constraints starting to occur in certain management instructions as congestion increased. Revenue grew by 15.8% in the first 9 months, while adjusted EBITDA increased 15.1%, impacted by $23.5 million of revenue share.

The next slide line shows all our Dallas-Fort Worth managed lanes registering double-digit growth in revenue per transaction, significantly outpacing inflation. This was driven by several factors. A favorable traffic mix with higher heavy vehicle volumes, thanks mostly to technology enhancements and camera recognition that started to be implemented in 2025. This improved vehicle classification as well as a higher number of mandatory mode events at NTE and NTE 35 West. For the first 9 months, revenue per transaction increased 17.1% at NTE, 12% at LBJ and 15.6% at NTE 35 West.

Looking at revenue per transaction growth in Q3 compared with Q2. At NTE, the lower growth in revenue per transaction mainly reflects fewer and less intensive mandatory mode events during the third quarter. At NTE 35 West, the comparison base is becoming more demanding as the benefits from improved vehicle classification began to have an impact in September 2025, while mandatory mode events also became more significant around the same period last year. As a result, the year-on-year contribution from both effects is now starting to normalize.

The operating performance supported higher distributions at the portfolio level. Dividend distributions for the first 9 months were at 100% stake, $118 million for NTE, $61 million for LBJ and $143 million for NTE 35 West. No changes versus June as these projects usually distribute dividends in June and December. Let us now turn to I-66 and I-77. I-66 delivered an outstanding performance transactions increased 4.1% in the third quarter and 7% in the first 9 months.

Revenue per transaction grew 10% in the first 9 months of the year and revenue increased 17% driven by higher toll rates with adjusted EBITDA up 18.1%. In Q3, the adjusted EBITDA margin was lower than in the first 9 months of the year, mainly due to higher provision for doubtful accounts related to video transactions. In terms of dividends, I-66 distributed $80 million in the first 9 months at 100% compared with $64 million in the same period last year. At I-77 traffic declined by 5.3% in the quarter and 5.2% year-to-date. Performance was affected by heavy vehicles shifting to alternative routes, increasing available capacity in the corridor and summer travel showing fewer leisure trips in the third quarter.

Revenue per transaction increased by 11% in the first 9 months and revenue grew by 5.4%. However, adjusted EBITDA declined 6.1%, mainly reflecting the step-up in the revenue share bond from 25% to 50%. This EBITDA impact is largely a first year effect and is expected to normalize over time as revenue grows within the new bond. I-77 distributed $18 million in the first 9 months at 100% compared with $22 million last year. Turning to airports and starting with New Terminal One at JFK.

March 2027 remains the Phase DBO date. This is subject to contractor execution and other factors, including the sequencing of the remaining activities, achievement of the required KPIs and coordination with key stakeholders, including CBP and TSA. The first set of basic trials has been completed and the remaining activities are focused on systems integration, testing and commissioning.

New Terminal One has reached 32 in agreements, comprising 24 executed agreements and (inaudible) letters of intent as of the date of publication of the results. The international traffic performance at JFK has been affected by geopolitical developments and by FAA measures taken to manage New Yorker's capacity constraints. Those are related to air traffic controller staffing mainly.

Given the current market conditions, the Port Authorities Board of Commissioners approved extensions to the Phase B1 and B2 construction milestones. With the notice to proceed deadline extended to September 2030 for Phase B1 and June 2033 for B2. Our equity commitments have been completed following the EUR63 million contribution invested in the second quarter. Total equity invested is EUR1.042 billion. Moving to Dalaman.

Passenger traffic reached $4.5 million in the first 9 months. This is 4% lower than last year, mainly due to lower international volumes affected by political challenges in the Middle East, but this was partially offset by strong domestic traffic growth. Revenue declined by 7.1% and adjusted EBITDA declined 7.7% in the first 9 months, reflecting softer international traffic levels. Moving now to Construction. The business division delivered a strong profitability and a record order book.

Revenue reached EUR5.8 billion in the first 9 months, increasing 9.1% like-for-like with adjusted EBIT margin improving to 4.1% from 3.7% last year, recording a solid 5.1% adjusted EBIT margin for the third quarter as well. Budimex maintained healthy profitability with a 6.9% adjusted EBIT margin for the first 9 months of the year and delivered higher like-for-like revenues. Webber increased its adjusted EBIT margin to 3.6% in the first 9 months of the year, supported by 17% like-for-like revenue growth and operating efficiencies. Ferrovial Construction improved its adjusted EBIT margin to 2.6% from 1.7% in for the first 9 months of the year. This reflected better execution in North America, the United Kingdom and Spain and lower bidding costs following the submission of major bids in July and higher revenue.

The order book reached a new all-time high of EUR19 billion and increased 8.2% like-for-like compared with December 2025. The composition of the order book remains very healthy. It does not reflect roughly EUR8.7 billion in contracts that are pre awards or pending financial close as of September 2026. These are mainly related to the I-24 and Budimex contract. Half of our backlog is in our core US and Canada market, which we expect will continue to support future growth. Well, a recap on the main operating results.

We see the figures here on this slide. The strong revenue and profitability performance for the first 9 months with very strong results across the board, double-digit growth in like-for-like terms, of revenue, adjusted EBITDA and adjusted EBIT. And now to conclude the results presentation. Let's focus in the net debt infrastructure projects. We ended the first 9 months of the year with a net cash position of roughly EUR1.7 billion compared with EUR1.3 billion at the end of 2025.

This reflects a strong cash generation, disciplined investment and the impact of recent divestments. The main components were EUR604 million of dividends from projects, mainly from Highways, with EUR350 million from the 407 ETR, EUR159 million from the Dallas-Fort Worth Managed Lanes and EUR138 million from I-66 and EUR11 million from the I-77 million. Next block is the construction operating cash flow, excluding tax payments and dividends, has reached EUR591 million and reflects a strong operating performance, along with some compensation received in the US and Canada.

And also, it benefited from some prepayments received earlier than usual at Budimex. These inflows were partially offset by EUR71 million of our operating cash outflows and EUR56 million of tax payments, mainly in Poland. In terms of investments, we had EUR231 million, including mainly the last equity injection (inaudible), together with investment synergy of EUR75 million, of which EUR42 million are related to the Leon County Solar PV Plant in Texas and construction invested EUR71 million.

Then we have the interest received on cash -- I mean from other investment activities. This cash flow reached EUR85 million and (inaudible) basically cash remuneration on the liquidity we have. Divestments were EUR96 million. The main component being Silvertown Tunnel and the transmission lines in Chile. Shareholder distributions include cash and share buybacks also and amounted to EUR461 million.

And then we have the cash flow from the financing activities, EUR612 million and mainly is related to repayment of EUR780 million corporate bond, the issuance of a new one, together with the dividends to minorities in Budimex, financial leases and interest payments. Last in the cash breakdown, we have the effect of the exchange rate on cash equivalents of EUR23 million. Overall, the group continues to maintain a strong net cash position and financial capacity while we are funding shareholder distributions and investment in our growth opportunities. Thanks for your attention.

I will now hand over to Ignacio to discuss the information on recent awards.

Thank you, Ernesto. And the following on the project overview presented at the commercial close and the information provided by TDOT, we'd like to provide some additional information on the concession payment structure and the revenue sharing mechanisms included in the concession agreement. The $24.8 billion figure published at our combined present value and nominal components as required by the (inaudible). To provide a consistent comparison, we have now presented all payments on a present value basis. On this basis, the total payments to TDOT amount to $21 billion, which is the same value included in our offer.

In accordance with the concession agreement, the payment profile is front loaded with approximately $7.7 billion of nominal payments during construction from 2027 to 2033, reaching approximately $1.1 billion nominal at peak. The remaining payments will be made during the operating period through 2085.

The table shows the full payment schedule on a present value basis. The $21 billion is calculated as of the contractual financial close deadline using the applicable discount rates with final amounts remaining subject to the financing structure at financial close. In terms of financial structure, we will be providing more information at financial close. [IFA ] requires a maximum leverage of 75% debt and 25% equity. In addition to these payments, the concession includes 2 revenue sharing mechanisms with TDOT. These are not included in the $21 billion and only apply the project performance above the defined thresholds.

The first is an excess revenue share. It begins when accumulated revenues exceed the base case level with TDOT observe increasing as the project IRR outperforms the base case. The second applies when toll rates exceed $3.2 per mile in 2025 dollars. TDOT receives 50% of the revenue between $3.2 and $4.8 per mile, 75% between $4.8 and $6.4 and 19% above $6.4. These dollar rates are escalating annually at the greater of 2.5% versus the average of state GDP, US CPI and 3%, similar to the [soft cap]. So overall, the structure provides TDOT with significant contractual payments while also allowing TDOT to participate in the upside if the project performs above the base case.

I will continue presenting the I-285 East Express Lanes, project in Atlanta an important addition to our managed lanes portfolio and a project with the potential to create significant long-term value. The presentation is similar to what I presented a few weeks ago about I24 project in Tennessee. The I-285 East program is structured in different phases under a comprehensive development agreement with TDOT. Ferrovial leads the project consortium with a 90% ownership stake. Phase 1 is the committed phase.

It covers approximately 23 miles, including the extensions at SR 400 and I-85, adding to westbound express lanes in the I-285 corridor. The Phase 1 agreement includes (inaudible) activities, and a 50-year operational maintenance period.

The project has an estimated construction cost of approximately $8.9 billion with an expected half year of construction period, expecting service commencement in 2034. The proposed concession payment is $23.1 billion. Final figures subject to interest rate movements and financial restructuring prior to financial close expected by October 2027. Additionally, $515 million will be paid at financial close as reimbursement of estate cost. Phase 2 covers the corresponding (inaudible) alignment with approximately 23 miles, including the extensions already mentioned.

The second phase is partially committed, traffic and revenue assumptions and design and construction parameters are already defined while construction costs remains adjustable on inflation and the contractual parameters described in agreement. Phase 2 financial clause is expected in 2029, and opening expected in 2036.

Phase 3 is currently indicative. It covers approximately 40 miles in both directions along I-2855 and SR 141. Its scope, economics and timing remain estimates to be developed through the CDA. The current expected milestones are financial close in 2032 and opening in 2040. The important point is that Phase 2 and 3 are not automatically committed. They have to be negotiated and developed through the CDA and they will be executed under separate face agreements.

Turning to the economic fundamentals of the metro area. Atlanta is already one of the largest metropolitan areas in the US with approximately 6.5 million residents. While continuing to grow at around 1.3% per year over the last decade. This population growth has been accompanied by a strong economic performance.

Real GDP has grown at approximately 3.5% annually supported by a large and diversified employment base. The region also benefits from relatively high household incomes with media household income of approximately $92,000 around 13% above the US average.

Atlanta is a major economic center, representing approximately 70% of Ferrovial's GDP and home to 14 Fortune 500 headquarters with a significant development pipeline of around 500 to 600 new projects per year. Importantly, this economic base is supported by a strong talent pipeline with more than 300,000 college students enrolled and approximately 64,000 degrees awarded annually, provided a continuous source of skill labor for the regional economy.

Atlanta is also a major transportation and logistics hub, supported by the world's busiest airports and the key interstate connections. Overall, Atlanta combined significant existing scale with a track record of sustained population and economic growth, high incomes and a deep talent base, supporting employment, mobility and long-term travel demand across the region.

Moving on to the corridor itself, I-285 brings together jobs, residential areas and freight flows across a single heavily used ringroad. I-285 currently carries approximately 200,000 to 240,000 vehicles per day, make it one of the region's most heavily used corridors. I-285 connects major employment and residential centers, with demand largely driven by short trips. Fewer than 3% of trips are end-to-end, and the average strip is approximately 5 miles, highlighting the importance of multiple access points along the corridor. I-285 plays an important role in the region's freight and logistics network.

True track traffic is routed away from Central Atlanta and onto the ring road and its interchanges, contributing to a meaningful highway vehicle presence of approximately 10% to 12% of corridor traffic. The corridor is also an important regional connector between Atlanta's major interstate highways, around 20% of truck trips travel between I-285 and I-75, reinforcing I-285 role as a key freight bypass. Beyond freight, I-285 supports significant commuting and business demand creating a diversified mix of users throughout the day. Overall, this combination of local, commuting, business, freight and regional traffic creates a broad and diversified demand base with connectivity playing a critical role in capturing that demand.

On the next slide, we saw the level of congestion on I-285 with a long duration and intensity not seen on other highways. As commented before, the corridor carries approximately 200,000 to 240,000 vehicles per day. The corridor experiences up to 8 hours of daily congestion. At big times, speeds can fall to around 20 miles per hour, with 4 to 5 hours of daily peak by direction. Importantly, this is not a recent or temporary pattern.

Congestion has been persistent across the corridor for more than 10 years. To put this congestion profile into context, SR 400 provides a useful benchmark given a similar managed lanes framework in the Atlanta market. The heat maps compare weekday traffic conditions in 2025 between I-285 and SR 400. Areas shown in red colors indicate more severe congestion and longer delays. What stands out is the (inaudible) a stronger congesting profile of I-285 East. Congestion extends across more hours of the day and both directions, while SR 400 is more concentrated around peak hours and the big duration with lower intensity.

I-285 East has greater freight flows exposure, trucks accounts for approximately 10% to 12% of traffic compared with around 3% on SR 400. I-285 East also has significant greater extended vehicles as possible, similar to (inaudible) traffic. So while the tolling frameworks are comparable, I-285 East has materially stronger underlying demand, which creates a deeper need for reliable travel times throughout the date and increases the potential value that the express lanes can provide to drivers.

Looking ahead, the traffic case is supported by a combination of strong assist in demand, suppress demand and expected continued regional growth. Starting with the regional outlook, third-party forecast for 2025 to 2034, so expected annual growth of approximately 1.1% for population, 1.9% for real income per capita and 2.6% for real GDP. Importantly, the traffic case does not rely on future growth to create demand. As we have seen in the previous slides, demand is already established and the corridor is operating under significant capacity constraints.

We also see evidence of suppress demand. Between 2012 and 2023, traffic on I-285 between I-75 and I-85 grew by approximately 0.4% annually compared with approximately 1.1% on regional freeways. However, growth on I-285 has been concentrated during off peak periods where capacity remains available while peak period traffic has been constrained by congestion. We, therefore, interpret the lower observed growth as evidence of capacity constraints rather than weak underlying demand.

These 2 years, there is latent demand that (inaudible) returned to the corridor once additional capacity becomes available. Based on our management's portfolio experience, users typically take approximately 2 to 3 years to become familiar with a new road configuration and the benefits it provides supporting progressive adoption following opening. Together, a strong existing demand, the release of suppress demand anticipated continued regional growth and expected progressive user adoption support the long-term traffic assumptions for I-285 East following its expected opening in 2034. Turning to Connectivity. As highlighted earlier, it is particularly important on I-285, given the predominantly local nature of demand and the relatively short average strip length.

This has, therefore, been a key focus of our design and one of its principal differentiators. Compared with TDOT reference design, our solution increases (inaudible) movements from 42 to 170 and entries and exits per mile from 2.3 to 3.1. Most importantly, the share of corridor trips serve increases from 55% in the reference design to 95% in our design. This represents approximately 1.7 times more in scope trips.

A particular focus has been freeway to freeway connectivity at SR 400 and I-285. Based on our managed lanes portfolio experience, we see this connectivity as critical to network performance and our design provides full connectivity at both interchanges. The design also provides direct access to major cross streets, track friendly connections and further improving access across the whole corridor. In addition, the design extends the corridor to additional mileage along I-285 and at the SR 400 and I-85 connections. Overall, better access allows more drivers to use the express lanes for their everyday trips while providing a smooth connections across Atlanta's wider highway network.

Moving to the pricing framework. The objective is straightforward to maintain reliable travel times and a predictable free-flowing experience for users as traffic conditions change. The framework starts with an OTR of cap of $2.01 per mile in 2025 with a corresponding hard cap of 2 times OTR of cap or $4.02 per mile. Pricing responds dynamically to real-time traffic conditions to protect travel speeds when volumes exceed 1,500 passenger car equivalents per lane per hour or speeds fall below 55 miles per hour, tolls can increase up to 2 times OTR cap. This pricing response can apply not only to the affected segment but also to up to 2% segments helping this demand before congestion reaches the bottleneck.

The second important feature is the predictable growth of the OTRs of cap. The OTRs of cap increases annually at the greater of 2% or the average of nominal GSP, CPI at 3%, providing built-in escalation. In addition, the framework includes performance-based sub-cap adjustments assessed every 6 months directly linked to the service experience by users. Given the expected traffic conditions, these adjustments may play a critical role to maintain reliable travel times. A 3% congestion adjustment can apply when sustained demand keeps tolls above the soft cup, more than 20% of the defined peak periods in a segment, figuring (inaudible) to the OTRs of cap for the entire phase.

A separate 18% targeted speed adjustment can apply when the speeds remain below 45 miles per hour, more than 10% of the defined peak periods in the segment, again, triggering an adjustment for the entire phase. The objective is to restore the target level of service. These adjustments increased the OTRs of cap itself and we did the corresponding 2 times hard cap, allowing the pricing forward to adapt as traffic and congestion evolve.

Finally, vehicle class pricing protects lane capacity with toll multipliers of up to 5 times for extended vehicles. Overall, these 3 mechanisms work together to manage demand, protect travel speeds and provide express lanes users with a reliable service and predictable trip.

Moving to construction and design our approach focuses on bringing forward scope while simplifying delivery and reducing execution risk. Our approach brings forward more scope with an additional 8.5 lane miles incorporated into Phases 1 and 2, while simplifying the overall phasing strategy reducing construction interfaces, remobilization and handoffs between them. Another important element is to increase and optimize access. The design incorporates broader and higher-quality connections while seeking to integrate this additional scope efficiently into the construction program.

From a structural perspective, the design also reduces the use of elevated and steel structures, which improves constructibility and supports greater schedule certainty while also reducing future maintenance requirements. Approximately 30% of (inaudible) design development has been completed across Phases 1 and 2 with additional design award for critical components. This provides greater visibility on pricing and schedule.

The delivery platform benefits from a significant local subcontractor network, self-perform activities and more than 10 years of experience in the corridor. Inflation risk is mitigated through developer and grantor protection and additional cost contingency. The combination of more scope delivered from fuel interfaces, (inaudible) design and a strong local delivery platform gives us greater confidence in construction execution, schedule and cost certainty.

Moving on to the next slide (inaudible), the I-285 is supported by operating data analysis and experience from across our managed lanes portfolio, providing differentiated data insights across the key traffic and pricing variables. This allows us to benchmark the assumptions of the bid against what we have observed in operation. On traffic, we use portfolio experience to assess how capture rates change by vehicle class and time period, how connectivity affects usage of network, how quickly users adopt a [new toll] road and how suppress demand returns as new capacity becomes available.

Similarly on prices, we look at observe behavior around cap triggers and pricing above [OTRs of cap] customer response to toll rates changes and how toll segmentation and differentiated vehicles pricing can be configurated to manage demand and preserve service quality. In short, the I-285 East bid is underpinned by proprietary analysis, proven operating experience and a detailed understanding of managed lanes customer behavior in practice.

Moving on to the next steps. This slide sets out the main expected milestones for Phase 1. Commercial close is expected in December 2026. The next major milestone is financial close. The contractual deadline is October 2027, and we currently expect completion before that date.

Ground breaking is expected in the first quarter 2028, with early works expected to occur between commercial and financial close ahead of the groundbreaking date. Full service commencement is expected in 2034.

As we also explained in I-24, the financing framework includes agreed interest rate protection with TDOT from bid to financial close varying by instruments. For private activity bonds, TDOT bears 100% of base rate risk and 85% of margin risk while the developer bears the remaining 15% of margin risk. For taxable debt, TDOT bears 100% of base rate risk and 85% of margin risk. The developer bears volume risk and the remaining 15% of margin risk. (inaudible) debt, TDOT bears volume and base rate risk as shown on the slide.

TDOT also requires an investment grade credit rating for the project debt bidding proposal. The overall framework provides meaningful protection against financing market movements between bid and financial close. We'll be sharing information on final concession value and final structure after financial close.

Let me close by bringing together the key messages from today's presentation. I-285 East is a highly congested multiple portion road and Atlanta's principal freight bypass. Congestion is long standing, stands across the day and affects both directions supporting a significant base of suppress demand. Atlanta Metro has solid demographic and economic growth prospects with a diversified employment base above average household income and strategic transport connectivity. Our best value award was supported by a differentiated design that is expected to serve 95% of corridor trips compared with 55% in the reference design.

The pricing framework provides significant flexibility to respond to congestion and grow pricing over time, starting with $2.01 per mile OTRs of cap based on 2025 dollars, dynamic pricing allowing real-time pricing up to 2 times OTRs of cap, including annual and performance-based adjustments supporting progressive OTR growth and toll multiplayers that go up to 5 times the light vehicle for extended vehicles.

The CDA provides a structured framework to negotiate and develop Phases 2 and 3. These potential phases represents an additional growth pipeline, but remain subject to separate development negotiations and our processes.

As we heard during the I-24 presentation, we have maintained our disciplined approach to capital allocation, targeting a double-digit equity IRR calibrated to the projects, risk profile and complexity, considering that these types of projects are riskier than others. We continue to have a strong balance sheet capacity, and we intend to short the funds for the equity commitments for both I-24 and Phases 1 and 2 of I-285 East mainly with cash generated in our operations and to a lesser degree with additional corporate debt, all within the framework for BBB rating and excluding any equity raise at the Ferrovial level.

Thank you for your attention, and I will now hand the presentation back to Silvia for questions.

(Operator Instructions) Our first question comes from Luis Prieto from Kepler Cheuvreux.

I had a number of related questions. The first one, what led the TDOT and you to make public the concession value payment schedule for the I-24 ahead of financial close? Can we -- in this context, can we assume the schedule is a result of a negotiation that was completed with the commercial close agreement? And in relation to the I-285, should we expect a similar dynamic in terms of negotiating the schedule and recent commercial close and disclosing the structure?

Thank you, Luis, for your questions. So as you know, in all these processes, we have some NDA clauses and confidentiality that we cannot share some of the information. So that's why we did not share some this concession payments for I-24. And at the time that TDOT let us to give that information, we made it public based on the press release that they made on Monday so immediately after we communicated that information.

Regarding the I-285 East, I have to say that each of them is different, different projects that are differently negotiated. And in that specific case, you will not expect to receive any additional information on the financial close will you get all the about equity and concession payments.

And if I might squeeze in another one, a more technical one. How should we interpret the I-24 and the 285 interest risk assumed by the grantor. Is the grantor obliged to pay the excess financial expenses and interest rates deviate from commercial close guidelines until the facilities are refinanced at cheaper prices? Is that a way of looking at it or it's completely different?

Probably the way to look at it, Luis, this is Ernesto speaking is, I mean, you look at the interest rate effect on a present value basis and payments are adjusted accordingly. So it's in terms of concession value that it gets adjusted.

Our next question comes from Cristian Nedelcu from UBS.

Could I ask you first on the I-285? I think the grantor slides, we're talking about the concession payments being made during the 6 years of construction. Could you help us understand if that is set in stone or that is subject to negotiation and we could see a payment structure similar to I-24? The second one, just to clarify on I-285 Phase 2 concession payment. I understand that you cannot disclose any value, but it's the same road in the opposite direction.

You've committed to your traffic and revenue forecast. Would it be fair to assume there's a similar concession payment in order of magnitude? Or could it be there's no concession payment for Phase 2 at all? Any color just for us to understand a bit of magnitude.

And the third one, if you allow me, maybe on the NTE, I think you have now one month since the new capacity has been added and I was wondering if you can share any conclusions in terms of the net impact on the revenue growth there, less mandatory malls, more volumes? Any color you could give us at this stage?

I will take the first 2 questions, and then Ernesto will take the third one. Yes, I think that at the conference call, TDOT explained that this equal payments in the construction, but also it was noted that it may change based on the change of interest rates or the final financial structure. So final numbers, as commented previously, will not be commented until financial close. And the second question about the Phase 2, don't take assumptions that are similar. Also, yes, it's different direction, but I think it will be different type of cost in order to develop that and different type of revenues. And then the financial close will be in 2 years. So don't take for the time being any assumptions that is going to be exactly the same. It may have some (inaudible).

Yes. I mean regarding density impact, there's very limited we can comment now. Yes, we are seeing more traffic coming back to the corridor. Regarding mandatory modes, I mean that is something that will have to be gauged next year because of how the contract is drafted after the opening. So we would be informing next year about that.

The following question comes from Harishankar Ramamoorthy from Deutsche Bank.

A couple from my side. How should we think about the I-24 legal challenge? What's the process from here on? Does the award become irreversible at some point? And if not, and if the decision gets overturned, then what's the exposure for Ferrovial? That's the first one.

And then secondly, on 407 ETR, is it fair to say that outside of the COVID period, the traffic decline there has been the steepest in the last quarter? And I do get the point on several external factors, tariffs and whatnot. But thinking about the levers that you have at your disposal, should we think about -- or rather, how should we think about price increases next year? And would you dismiss the possibility of, say, reducing the tolls?

I will take the first question about the I-24. I mean we are not worried at all about any legal challenge. Of course, we cannot comment because there is a litigation ongoing in which TDOT and the consortium that was part of this challenge. But I think they will be solved faster. And as I said at the beginning, we are not worried at all about this legal challenge.

Okay. And regarding the 407, I mean, clearly, the traffic, as I mentioned before during the presentation, has been affected by how we have managed promotions, targeted promotions and so. And we still see that the product is well valued. I mean the growth in revenues is substantial this year. We don't provide a specific guidance, but I mean, I rule out lowering prices as you were suggesting.

The next question comes from Elodie Rall from JPMorgan.

First of all, just a follow-up on the 5.2% discount rate. I think the question was raised earlier, but I didn't quite understand how it could be adjusted higher at financial close and the consequence on the projects in PV like at this stage. So if you could help me understand that a little bit better, please.

Second, the I285 East you got a new partner for 10%. So I think now you're at 90%. Do you look for a third partner, what's the ultimate goal there?

And maybe lastly, on construction margin. Clearly, a very strong performance in Q3. You're above the 3.5% margin target. So is that 3.5% still valid target in the midterm? If you can comment on that.

Okay. So I take a -- Elodie, this is Ernesto. I'll do a little bit of further explanation on the interest rate and margin compensation. So I mean, we basically submitted financial structure with the conditions indicated that were the prevailing, let's say, at the time in terms of debt, right? So Imagine that base rates and spreads have gone up, right?

And therefore, when we go to the financial close, the capital structure that we submitted now at financial close is different. It has higher interest rate and higher spreads. The grantor makes up for the increase in base rate and 85% of the of the margin. And the way that gets adjusted, there's a formula that basically says, okay, these additional payments have an NPV value of X, right? And that is what gets compensated, right? And it gets compensated with, let's say, concession value.

Regarding the second question about the partners at the 285, yes, we have 90%. That is higher than usually we used to have. So we may, at some point of time, decide to reduce our participation to more similar participation with a maturity but similar to what we have in other managed lanes. But the question is when. So we have not taken a decision.

We may do it before/after financial close -- after construction. Of course, as long as you reduce the risk of this project, the value will increase. But we have not taken a decision yet. But at least, we'll consider that usually we may reduce our participation as to be more similar to what we have in other assets.

Okay. Regarding the construction margin, we've always mentioned that this is like a long-term margin average, right? So (inaudible) some moments we could be above. Of course, there are moments we could be below. So we think that as a long-term margin, this is a reasonable margin for the Construction business.

Our following question comes from Ruairi Cullinane from RBC Capital Markets.

My first question on the I-77, do you think any of the reduced traffic year-to-date was a price elasticity impact, either they have good (inaudible) of the leisure traffic? And secondly, perhaps you could just sort of talk about your appetite for further managed lanes following the award this year? And then back to results, what drove the improved energy performance in the quarter?

Okay. So regarding the I-77 performance, when you look into the area, just like 2 long-haul corridors for heavy traffic. I mean, one is the, i.e., the I-85 that then goes into the I-95, this Northeast corridor, and on the other hand, you have the I-77 that connects into the I-81, right? So I-81, I-85 and I-95 are kind of parallel, right? So the I-85, I-95, let's say, is more dense.

What happens with the I-85 is -- sorry, the I-81 is that now it's under heavy construction, right? So we see heavy traffic that is now using the I-85 that connects into the I-95 rather than I-81. So as long as this construction goes on, we expect heavy traffic to shift as it has been seen this year into this alternative corridor, right? When you have less heavies on the road, definitely capacity increases, right? And therefore, our capture rate suffers, right?

So that could be seen as an important driver of the performance. It could last for some time. And -- but I mean in terms of should the share load region growing and so on, is still expected to grow.

Regarding the second question about -- yes, we have prequalified for the I-77 South. We are waiting for the (inaudible) and yes, we'll participate and will bid for these new managed lanes, and we actively participate in other qualification process of additional managed lanes in the future. So yes, we have full appetite for these type of projects that we think can create very good value for the company in the future.

And regarding the question regarding the energy performance, well, I think it's the comparison between a year where still the Energy division was still developing some construction projects, some EPC plants and also transmission lines. The moment transmission lines are operating or you finalize EPC contracts, you get a better margin. So it's a matter of scale and evolution of the portfolio.

Our next question comes from Graham Hunt from Jefferies.

Can I just start with the 407 and try and dig a bit deeper into this volume decline in Q3. I mean from what it looks like and what we see the discounts that you're offering in Q3 were really pulled back. I mean that contrasts quite significantly with, I think, the strategy last year where they were really dialed up. So just trying to understand what's the rationale in thinking there? And I suppose how much of the minus 7% on volumes came from changes to the way you were offering promotions versus what you might refer to as one-off or macro weakness?

I'm just trying to sort of get my head around the pricing strategy that you're pursuing on that asset. And then my second question, if I can ask on the 285. -- the sort of references to heavy vehicle percentage on the corridor and the 5 times multipliers, et cetera. I'm just trying to understand sort of apples-to-apples numbers here because as I understand that the I-285 can't take heavy vehicle traffic. But is it 10% to 12% of heavy vehicles, is that a reference to the vehicles, which can travel on the corridor?

Or are you saying that, that heavy vehicle traffic on the corridor in general will drive more light vehicles onto the road? So just trying to get a sense of what percentage of vehicles in the corridor that are eligible to drive on the 285 Express Lane would qualify for the higher multiples, the 5 times multiplies that you referenced in the deck? Sorry for the long question.

Okay. Thanks, Graham, for the questions. I'll take the first one on the 407. Last year, I mean, really promotions were broadly offered different times of the day, different segments could be used. Right now, we have a more targeted approach that means that there's some sort of commitment -- okay, you drive X and then you get the promotion, or I mean, the promotion is valid as long as you conclude spending some amount, that sort of thing, right?

And one idea that this was targeted is also, as you see, we have reduced the expenditure overall for the Schedule 22 with much higher revenues, right? So that means that even segments that where we were not that able steering traffic, now we are resteering traffic, right? So is a mixture of providing value for customers. They appreciate that and also just also managing the cost component, right? So that's when we mean targeted promotions that's the explanation.

And regarding the 285 and heavy and extended vehicles, the point that we were making during the presentation is that today, heavy vehicles in the 285 are around 12% to 14%. And we mentioned this figure because it's public information also and also mentioning that a few of them take the whole trip. So most of them just enter on one interchange and they exit in a different one. So shorter trips from interchange to interchange. But this type of traffic, what generates is a lot of congestion in the 285 in the general purpose lanes.

Heavy vehicles are not allowed to use the managed lanes, but extended vehicles, yes, and extended vehicles what is different here and that you need to consider is the definition first, that is broader than in other type of -- in the case of the Texas managed lanes so it's different to the I-24. So the definition of extended vehicles is broader in this case. And what is also higher is the multiplier.

And what is also relevant compared to others like SR 400 and other type of highways is that the number of extended vehicles is significant. We have not given a number for -- I mean, they want to keep intellectual property and information that we may have from other -- our own, I mean, analysis and research and knowledge, but we think that it plays a significant role because of the number and because how they behave and because the time savings for them are very relevant.

Understood. And thank you for the additional I-24 information as well.

The next question comes from Marc Ip Tat Kuen from Citi.

I've got a few, all on the I-24. The first one is just a clarification on the time line for the I-24. I think it's changed maybe a bit from the analyst call at the start of the month. Previously referred to (inaudible) 2035, but the concession payment schedule shows your payments will start from 2036. So can you just clarify the time line there for me, please?

Second one is on the maximum, the leverage, 75%, 25% cap structure on the 2-year term sheet. Does that only apply at the commencement of operations? Or do you need to adhere to that throughout the whole of the concession? And then just the last one, which I can't remember if you shared before or not, but are you able to share what unlevered project IRR you're targeting for the (inaudible)? Was that -- is that in the single digit or double-digit range, please?

Yes, about the first question, you understood well, is about the payment in 2036. What we think if we understood well the question is because it's the first year of operation, so the full year of operation. That's why it's the first payment. But I don't know if we are answering the question that you are asking or not fully.

In the presentation at the spin on the 5th of October, I thought the start year was 2035. Has that shifted now to 2036 as per the concession payment schedule?

Yes. The '36 is the first full year of operations. So the whole year is 2036. But the '35 will be a few years -- a few months, sorry, in operation, but not a full year. I don't know if you understand the difference.

Okay. So then -- sorry, sorry, regarding the other 2, the first one was on the TFA requirement for a minimum 25% equity. This is for financial close. I mean there's no specific condition for the project that evolves a long time. It's just for financial close.

And I mean, type of IRR that we require at a project level is close to double digit. So it's super high single digit, I would say that usually, the goal is to translate in a very healthy, let's say, levered double-digit IRR, as we mentioned. But of course, for the project to be solid, you need also a very high project level IRR. So I mean it translates into something like that.

The next question comes from Marcin Wojtal from Bank of America.

So I've got a few questions. The first one will be on 24 and on the capital structure. So you disclosed that TCR documentation permits to fund up to 75% of that project with that and only 25% of equity is required. But is that actually the capital structure that you want to pursue for the specific project. I believe historically, equity component is closer to 40%.

So could you just clarify, is there a big change versus the historical run rate? My second question will be on I-285. Are there any revenue sharing clauses? I don't see anything disclosed. So do they don't exist or they are just not yet disclosed at this stage?

And maybe question number three, it's a bit of an open one, but you indicated that you assess legal risk, litigation risk for this project as being very, very low, and you expect this to be resolved quickly. Any additional color, what gives you the confidence in a quick resolution, if possible?

Okay. Regarding the structure, I mean, in the past, if you recall, TIFIA did finance a more limited number of expenses by type of expense, right? Now they can -- I mean, their term sheet, as shown in the (inaudible) presentation, covers up to 49% of different concepts, right? So they have increased the scope, right? And that is what drives the possibility of a higher leverage being how robust the TFA financing makes any structure, right? So it's that change on TIFIA scope that has changed the dynamics on leverage.

Regarding the second question about the revenue share, this is going to be something very standard, similar to what you see in other managed lanes in which when you over perform according to your base case, then you start to share with the grantor. So I think it is not going to be different to other managed lanes. And regarding the legal risk, yes, we mentioned that we are not worried. In this specific case, I mean, of course, there is litigation ongoing, and we cannot comment on give further arguments in a litigation especially that we are not part of it or we're not directly involved. So we cannot give more information about it.

Our next question comes from Eddy Diamantis from Green Street Infrastructure.

Just as an introduction, my name is Eddy Diamantis. I'm a senior reporter covering infrastructure in North America and throughout the Americas. Really excited to hear about the I-24 and I-285 transaction. So my question is more so focused on the financing for it. So I'm curious, how will the project financing for I-24 and I-285 East be structured? Who are your financial and legal advisers and who do you anticipate will provide this project financing?

Eddie, I mean, usually, we focus this call for investors and analysts, but happy to take your questions. Well, in terms of the structure, as I mentioned before, the that component, the main driver is TIFIA funds. And then we have private activity bonds that basically have been allocated to the states and they provide a number that could be used. And then taxable bonds.

But as I said, the main component is the TIFIA financing. This -- let's say, taxable bond and so are assessed through with financial advisers, financial advisers are not made public but they provide a view of what is the, let's say, the market appetite or capacity when we submit the bid, right? But as I said, the bulk of it is TIFIA. And then, of course, the remaining is the equity. And then the last -- okay. So I think that, that answers your question, hopefully.

Yes. Yes. And just so I understand, too, and I understand this is for investors, might be a little out of place here. But in terms of who will provide this financing for these private activity bonds and taxable bonds, those will be listed on public markets?

Oh, yes, yes. This is the capital markets transaction, and this is the useful muni bond issuance and taxable bonds that are capital markets listed and (inaudible) with the prospectus, everything is public financing.

Awesome. Great. And you mentioned before that you'll have full appetite for other P3 projects. Could you confirm any other projects that you're looking at besides I-77 in the United States?

Well, we will comment when they come to basically a request for qualifications or something like that at that point in time and when we tend to make this public. So thanks (inaudible) I mentioned before, this is more for investors and analysts. So thanks for attending.

The following question comes from Jose Manuel Arroyas from Santander.

I have 3. The first one is on the I-285 East. I wanted to come to (inaudible) earlier question and to get a clarification. The other day, the Georgia Department of Transportation set the concession fees have to be paid in 7 installments. I just wanted to clarify, is there a possibility?

Or is there not that at financial close or maybe sooner this schedule of 7 payments can be changed and be eventually spread over the concessional life like I-24? That's question number one. Then question number 2 is on I-24 and the revenue sharing payments, which are based on IRRs. Just to get a sense of how likely these payments may be or they may not be, is the IRR triggers here? Are they higher or lower than, for instance, on I-66?

And lastly, on NTO, I mean you've mentioned that there has been a change to the start of the development of Phase 1B and 1C. And I understood this was at the request of the Port Authority, would the concession be extended to make up for the 3-year delay?

Yes. Thank you, Jose. I will start with the 285 and the 6 payments during construction. Yes, this is what was mentioned from TDOT. And also in the same presentation, it was mentioned that it may change based on the difference in the interest rates and also final financial structures.

Just repeating what they were saying at that time, nothing more to be said.

And as commented at the end we'll see -- at the end of financial close, we'll see the final numbers. Regarding the revenue, sir, and (inaudible) to access that. I think that it will reach the revenue share. I think all of us will be very happy because it means the I-24 is outperforming. But hopefully, it's the case that is outperforming and hopefully, we reach at that level. But if that's the case, I think that it is performing even better than some of the other managed lanes that we have today.

One regarding the potential extension of NTO, no, that's not part of the contract at this point in time.

The next question comes from Cristian Nedelcu from UBS.

Could I ask on the current portfolio, based on what you've been saying earlier, I think I-77, there are some headwinds on the heavy -- from the heavy trucks moving away from the corridor. I think you mentioned you're lapsing a bit the technology benefit in Dallas in terms of pricing, better segmenting pricing capacity is unclear as the impact on revenue. This free level seems to be a bit of a headwind or suggest a bit of a deceleration in the pace of revenue growth. My question is a bit, what's offsetting that? Maybe could you talk a little bit about the positives, I guess, LBJ traffic is good, but I'm trying to understand if going forward for the next few quarters, what are the headwinds and the tailwinds that you see in front?

The second one, if you allow me, what's the range of cost of equity for this type of projects like I-24 to I-285. I guess at this point, when we have construction risk and traffic ramp up risk and once we derisk them. Could you help us with a bit of a range on appropriate cost of equity there?

And the third one and the last one is just a small clarification. Apologies, I come back to the [I-285 Phase 2]. Just for us to understand the mechanism how the concession payment is determined, is it correct that you've committed to your revenue forecast through Phase 2? You've committed to CapEx forecast as well as the fact that the equity IRR that you are able to earn there cannot be higher than Phase 1. So therefore, by back solving against these 3 data points the concession payment due to the grant will be calculated in this way.

Is my understanding correct in big lines? Or am I missing anything? Several investors believe there's no concession payment related to Phase 2. So I just wanted to -- or there's a very symbolic one. Just wanted to understand a bit the direction of trouble.

Okay. So in terms of revenues, I mean, going on. Yes, you are right that the is showing, I mean, the corridor increase and that improves our performance after the opening of the (inaudible) that should keep going up. Then in terms of the I-66, also, we see that the corridor is growing more than we expected. Probably there's developments to the west part of the corridor -- I mean, in the (inaudible), it was more concentrated on the eastern part, very closer to the (inaudible) so that is also driving some strong support growth there.

In Canada, we mentioned that this has been a year very super soft in terms of economic performance. So as the economic growth returns, population gross returns those are drivers that helped to the growth over there. So I mean those are good drivers of growth. In terms of other news, yes, we will be facing out the technology impact on the Dallas-Fort Worth concessions. The economy there, the background growth continues to be good.

So as the areas keep growing, also revenue growth keeps performing, right? So I would say that's a good balance for the current portfolio. And well, the cost of equity -- it's a very good question. I mean if we take most of the business plans that we are seeing in the market, that are well below (inaudible) was probably that would merit a very low discount rate single digit after opening, right? So we'll see. I mean, the (inaudible) itself for that.

Regarding the question about the Phase 2, in this phase, it's true that we gave a traffic and revenue numbers that they don't need to be the same as the Phase 1 first. The same with the CapEx. So also, we gave a figure of CapEx that can be adjustable for inflation and other factors that does not have to be the same as a Phase 1, so it could be a different number that you put in the bid offer. And then the financial close will happen in 2029. So many things could happen until then. So extrapolating that Phase 2 is going to be the same as Phase 1, it's not the case.

And all what we said is that you have to wait until that time in order to understand the numbers and the figures and we cannot say that it's going to be the same of the Phase 1, and you have to wait until then because it's a long period of time, and many things will happen until then.

The next question comes from Dario Maglione from BNP Paribas.

Thanks for the many presentations today. I have 4 questions. The first one is on the I-285 project. How likely is that Ferrovial will get an additional partner for this project, let's say, in the next -- before the road opens? Second question, what happens if you don't find a partner before financial close?

Would Ferrovial still sign the contract? Could you walk away from it?

Third question, regarding the I-24 payment share, it seems that payment is very back-end loaded. So is it reasonable to expect that this fixed concession payment will be less than $200 million once the road opens in 2036? And then rises progressively towards EUR5 billion and EUR10 billion by the end of the concession?

And then last question regarding the discount rate that you have agreed with TDOT (inaudible) calculation for these concession payments. It's a 5.2% planned average discount rate, if I understand correctly. How did you set this discount rate because it seems quite low?

Okay. Thank you, Dario, about the partners as commented previously, no, we have not taken a decision when we are going to incorporate partners and that if they incorporate different periods of time, the pricing will be different also it is after the restart operation -- after it starts operations, then of course, you have the risk most of it and you have revenues and then the value of the road at that time will be much higher. And of course, if you do it after financial close, you have the risk a lot also the financial risk that you may have at that point of time. So what I say is that we may reduce, we don't know when. And of course, depending on when we do it, the value will be different and we'll ask for a premium that will be different depending on the timing of the sale of our participation.

In case of no partners and that we can walk away independently. So it's not that we need partners in order to reach financial close. We can do it without additional partners. But always, we have the option to withdraw, but we don't see that as a probability because we think that this may be a good project for us.

And regarding the I-24 about your assumption that we gave present value numbers and you can take your assumption with this number on the discount rate. I'm sure that you are not going to be very far away because it's not a big range of difference that you may have. And the discount rate is based on TIFIA is taken as a reference is what is the TIFIA cost for these type of projects.

The following question comes from Luis Prieto from Kepler Cheuvreux.

Leaving funding firepower side from a risk and resource management perspective, is there a limit to the number of used managed lane projects that you can simultaneously develop?

Well, I think that -- I agree with you that the main risk is related to construction and to have the resources to do all these projects at the same time and it's something that we need to see if we are prepared or we may bring partners in order to develop some of those projects. So we'll see. For the time being for these 2 projects, we can do it ourselves with the capabilities that we have. In others one, if we feel that we may need additional resources, we may partner with others, but it's a decision that we need to take later on. Not today. But we feel comfortable with these 2 managed lanes and also bidding for the I-77 South, where we have experienced before in the geography in this place that we developed previously the I-77.

The next question comes from Marcin Wojtal from Bank of America.

So I have 2 quick ones. On the 407 ETR, the asset, I believe, increased the dividend by about 40% for 2026, would you say the asset has already reached its optimal capital structure after this dividend hike? Or there is more to do on releveraging into 2027? And could you remind us what are the key credit metrics that we should monitor to determine whether there is room for further leverage or not? And my second question, going back to the new managed lanes, how should we think about the timing of equity injections into these 2 very large projects? Ultimately, is there anything significant that would be actually injected before 2030 as you ramp up construction? Or is it very back-end loaded?

Thanks, Marcin. I'll take the -- this is Ernesto. I'll take the 407 question. Well, probably -- I mean, the metric -- the credit metric that matters most for the 407, is the debt service coverage ratio, and that's around 2.6%. So you can see that there's always room. As I've always mentioned, don't expect big banks in the 407, but definitely, I mean, it's super solid, right? So you have a good angle there.

Related -- the last question is most of the cash flows are back ended, so limited -- very limited before 2030, and most of them, '33, '34, even '35, so a long period of time.

Our last question comes from Nicolas Mora from Morgan Stanley.

Yes. Just a couple going back a bit on the details of the I-285, I know you don't want to give much on the light vehicle, the light trucks. But at least a ballpark figure, whether this -- the traffic for these guys is actually relevant. Are you talking about 1%, 2% traffic, I know, 5%, 10%, 15% because this changes a lot of the economics, especially with the tariff multiplier. That would be very helpful.

Second one, is -- in what scenario do you not get the Phase 2 on I-285? I mean, it doesn't have to be armageddon, but in which scenario would you basically walk away from where you promised the TDOT? And then can you help us understand on the (inaudible) front, how you expect the, let's say, the extra kickers on mandatory pricing to come in? So I think you've got the plus 3% or the plus 18%. How realistic is this? How central is it to your bidding?

And then the final point on TIFIA, I mean, I may be misunderstood, but I thought TIFIA was basically -- I mean, all the infra projects, state level get into a (inaudible) and basically you share the availability of TIFIA on an annual basis. Your 2 projects here is they're mostly funded by TIFIA will require a TIFIA quantum, which is 2, 3, 4, 5 times greater than what the SR 400 did. So I'm not entirely sure where you see the capacity of the TIFIA market for your 2 projects, but most likely I'm wrong. But please enlighten me, that would be very helpful.

So asking this question -- you're answering your question. First about the extended vehicles, as we said in the presentation, is we see a meaningful presence of extended vehicles and also, we commented compared to the SR 400 that materially higher, no extended vehicles exposure. And it's something that we have seen also in our Dallas managed lanes, we have tested this, how relevant this could be. And I think that there could be a relevant thing. And as I commented previously, how they are defined and what is the multiplier, and also, they are usually business, and they are -- probably behave, I mean, differently when you talk about time savings.

Phase 2 is -- I think it's going to add also value and still a long period of time in order to be negotiated and to reach a financial close, but we expect that it's going to create value for the company, but of course, at some point of time, we may withdraw we think is not the case. And this increase of the mechanism in which you can increase every 6 months, the soft cap by 3% that you can do it, so 6% in total during the year or if it's related to the speed that is 18%.

As we have commented this, what we see in this 285 that is today highly congested. It has been highly congested for the last 10 years. So there's a lot of suppress demand that is not using it because there is not a reality at all. And what we see also is the short distance trips in the corridor. And as commented, I mean, we see a lot of business here like extended vehicles.

We see also high income per capita. So I think that all these ingredients, what may happen is that (inaudible) in order to improve the level of service to apply these things. And we expect that this is something that will happen and that is because it's highly congested. So it's going to be relevant.

And it's a mechanism that is going to help us in order to maintain the level of service at the managed lanes that because of the ingredients that we commented previously, this is highly congested for (inaudible), it's 4 or 5 hours of peak time. So I think it's relevant the level of congestion and it will happen that the level of service is going to be not so good in these managed lanes because of the reasons that I explained before.

And regarding TIFIA is not for us to tell what would be the capacity. The way the contract works, if there's not and the amount of TIFIA that we are requiring in the proposal, the grantor has to come up with how to sort out that risk, right? So as I said, it's not for us to discuss the capacity.

There are no further questions at the conference call at this time. I will now hand it back to Silvia Ruiz at the Ferrovial team. Your line is now open.

Thank you. I will start reading the questions from the webcast. First question comes from Dominic (inaudible). Given the recent I-24 and I-285 concession awards, how should we think about the balance sheet between growing cash distributions from your existing infrastructure assets and the equity funding requirements for new projects over the next 3 to 5 years, specifically, how much cash do you expect to remain available for shareholder returns?

As commented previously, the equity needed for these 2 projects is very back ended, is starting most of it the large amounts, 33%, 34%. So it's very long dated. And meanwhile, I mean, we'll continue getting distribution from the dividends and cash collected from the business and I mean, regular rotations that we do with mature assets. So all this, of course, what we used to do is we have a 10-year plan. We analyzed what is going to be the commitments that we have, what is expected, I mean, the cash that we are going to get.

And based on that, the Board every year takes a decision about what is going to be the dividends for shareholders. Historically, we have given dividends to shareholders even during COVID. But we want to keep this flexibility depending on how the situation may change in a period of time.

Next question comes from Lucas (inaudible) Capital. Following the recent decrease in the company's share price, how do you view your buyback strategy? Are you, for example, considering accelerating the repurchase of your shares to take advantage of the price?

Okay. You know that we have on place buyback program. The buyback program complies with all the market abuse regulations, right? So we don't look to the particular execution. It has agreed -- so there's a bank mandated that has agreed.

And if the share is lower, we buy more shares. So definitely, that's taking into account and there's more buyback with lower share prices. So we are taking advantage of the lower prices, yes.

I have 2 questions here from Filipe Leite from CaixaBank BPI. First question, I-24, regarding the payment schedule of the operating period, what is the difference between investment-grade graded payments discounted at between 5% and 5.5% and the USD0.5 billion outside investment grade rating discounted at 8%?

Well, basically, when we submit the bid, TIFIA funding requires to investment-grade ratings for the debt structure, right? So basically, you there have all the senior payments, right? That means that the bulk of all these payments are senior and they are discounted as Ignacio explained before, with costs that are similar to the TIFIA cost. So the -- I would say the investment in rating means these payments are junior to the rest of the debt payments and these payments to the to the grantor. And therefore, they have -- they are small, but they have a higher discount rate naturally.

And second question from Filipe as well. Do I-24 and the I-285 have any kind of cost for the early termination of the contracts? And yes, how will the prices be set for these early termination process?

Thank you, Filipe. This is a very standard. It's fair market value as we have in most of our contracts. So it's close that is similar and standard in -- for the industry.

Last question on the webcast comes from (inaudible). On Page 6, you said the dividend (inaudible) notice to proceed, which has a deadline of June 2033 instead of (inaudible). So Ferrovial can't receive a cent from JFK and (inaudible) second expansion? In what year do you now expect the first distribution from NTO and is there any time-based fallback if (inaudible) is never launched?

Okay. So no dividends can be distributed until June 2033. You're right. I mean, it's in line with the (inaudible) by NTO following the delay of the Phase B1 construction September 2030. So I mean we don't provide guidance on dividends. (inaudible) issue the notice to proceed for Phase 2 no later than June 2033. And there is no fallback any modification to this commitment must be discussed and agreed with the port authority.

Okay. There's one last question coming on the webcast from Roberto (inaudible). When can we expect the new business plan?

We are working on it, and we'll take to the Board for approval at the end of December. So it will be in place at beginning of next year because the one that we have (inaudible) until 2026. But we have not decided is how and when we will communicate it externally. Although of course, internally, we really giving some guidance about what we want to do in the following years.

Okay. I think it's -- there are no further questions.

Well, thank you very much all of you for your participation in this results conference call and also the presentation of the I-24 and I-285. And again, thank you very much, all of you. Bye.