Ferrovial Q2 Earnings Call Highlights
Key Points
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- Ferrovial reported a strong first half of 2026, ending with approximately €1.3 billion in net cash. Cash generation benefited from €329 million in construction operating cash flow and €378 million in infrastructure dividends.
- North American highway assets drove growth, with 407 ETR revenue up 18.7% and EBITDA up 24.4%, while Dallas-Fort Worth managed lanes and I-66 also posted strong EBITDA gains. Traffic was weaker at some assets, including 407 ETR in the second quarter and I-77 during the first half.
- Construction revenue and backlog expanded, with the order book reaching a record €18 billion, but the New Terminal One project at JFK was delayed to March 2027 and is subject to €500,000-per-day liquidated damages following the missed June 2026 target.
Ferrovial (NASDAQ:FER) reported what Chief Executive Officer Ignacio Madridejos described as a strong first half of 2026, led by revenue growth at its North American highway assets and continued expansion in construction. The company ended the period with a net cash position of approximately €1.3 billion, excluding infrastructure projects.
Madridejos said cash generation was supported by €329 million in construction operating cash flow and €378 million in dividends received from infrastructure projects. Cash uses included a €63 million final equity injection into New Terminal One at New York’s JFK Airport, as well as €398 million for cash dividends and treasury-share purchases.
North American highways drive growth
The 407 ETR toll road in the Toronto area increased first-half revenue by 18.7% from a year earlier, with toll revenue up 20.2% following toll-rate increases implemented on Jan. 1. Traffic rose 1.8% during the half, aided by targeted commercial promotions, while EBITDA increased 24.4%.
Second-quarter traffic at the 407 ETR declined 2.7% year over year, however, reflecting softer economic activity, less rehabilitation work on alternative highways and adverse weather, according to Madridejos. The company recorded a Schedule 22 provision of C$5.5 million in the first half, compared with C$45.2 million in the prior-year period.
The 407 ETR paid C$500 million in dividends in the first half, and a further C$550 million distribution was approved for the third quarter. Chief Financial Officer Ernesto López Mozo declined to provide guidance on future dividends from the asset.
Madridejos said the company has shifted its approach at the 407 ETR toward combining toll pricing with selective promotions to maximize EBITDA, manage congestion and reduce Schedule 22 payments. He said promotions will remain part of the company’s strategy even independently of Schedule 22 requirements, though Ferrovial does not plan to disclose the share of traffic generated through promotions.
Ferrovial’s Dallas-Fort Worth managed lanes also posted revenue and EBITDA growth despite construction disruptions, weather and higher revenue-sharing payments. Revenue per transaction increased by 18.9% at North Tarrant Express, 11.7% at LBJ and 17.3% at NTE 35W during the first half.
- North Tarrant Express adjusted EBITDA rose 14.7%, while traffic declined 2% in the first half amid capacity-improvement work.
- LBJ transactions increased 2.9%, and adjusted EBITDA rose 15.2%.
- NTE 35W transactions increased 0.4%, while adjusted EBITDA rose 18.6%.
Madridejos attributed the improvement in revenue per transaction largely to enhanced camera-recognition technology that improved classification of heavy vehicles, which pay higher tolls. Mandatory-mode events at North Tarrant Express and NTE 35W also contributed. He said the technology was implemented across the assets during 2025, meaning comparisons in the second half will increasingly include the effect.
Construction on the I-635 East feeder corridor near LBJ is nearing completion, with new managed lanes on I-635 expected to be completed in the first quarter of 2027. Madridejos said the company expects construction-related impacts in the area to be largely resolved by then.
Elsewhere, I-66 revenue increased 17.9% in the first half, with traffic up 8.5% and adjusted EBITDA rising 20.4%. I-77 traffic declined 5.2%, reflecting lower congestion, difficult comparisons with 2025 and adverse weather. Its adjusted EBITDA fell 5.4%, partly due to a step-up in the revenue-share band, although revenue per transaction increased 11.8%.
JFK terminal schedule moved to March 2027
At New Terminal One at JFK, Ferrovial submitted a remedial plan setting March 2027 as the targeted date for Phase A beneficial occupancy. The project was approximately 92% complete at the end of the first half, with systems integration, testing and commissioning representing the primary remaining work.
Madridejos said the updated schedule was based on the best information currently available and was prepared with the contractor. He said liquidated damages of €500,000 per day began in July following the prior June 2026 target date, although the contractor may challenge the damages if it believes delays were not its responsibility.
The terminal had commitments from 32 airlines, including 24 executed agreements and eight letters of intent. Ferrovial completed its equity commitments with the €63 million first-half injection, bringing its total investment in the project to €1.041 billion.
At Dalaman Airport in Turkey, total passengers declined 8.1% to 1.8 million during the first half, primarily due to lower international traffic amid the Middle East conflict. Adjusted EBITDA fell 13.7% from the year-earlier period.
Construction revenue rises as backlog reaches record
Ferrovial’s construction division increased reported revenue by 7.1%, or 9.7% on a like-for-like basis, while maintaining its 3.5% adjusted EBIT margin. Budimex reported a 6.9% adjusted EBIT margin, while Webber’s like-for-like revenue grew 24.2% and its adjusted EBIT margin reached 3.4%, supported by operating leverage.
The construction order book reached a record €18 billion, up 2.8% on a like-for-like basis from December 2025. The figure excludes about €2.6 billion of additional pre-awarded contracts awaiting financial close as of June.
Construction operating cash flow was €329 million, compared with negative cash flow in the prior-year period, driven mainly by prepayments and compensation received in North America. López Mozo said some collections and payments had been delayed into the first half, while noting that the business has historically experienced positive working-capital seasonality toward year-end.
Pipeline and capital allocation
Ferrovial submitted bids for managed-lane projects on I-24 in Tennessee and I-285 in Georgia, with decisions expected in the third quarter. Its bid for the D35 Highway availability project in the Czech Republic was identified as the most cost-effective, with technical evaluation ongoing.
The company also said it has acquired power land in Alcobendas, Madrid, and Warsaw, Poland, for data-center development. Madridejos said the initial Madrid phase is expected to provide about 75 megawatts of IT capacity, with a first portion of nearly 45 megawatts. He said Ferrovial expects to use leverage, potentially bring in partners and recycle capital after assets are constructed and leased.
Ferrovial’s Horizon 24 strategic plan concludes this year, and management said it is developing a new plan but has not decided when or how it will communicate it externally.
About Ferrovial (NASDAQ:FER)
Ferrovial, SA is a Spanish multinational infrastructure company headquartered in Madrid that develops, constructs, operates and maintains transport and urban infrastructure. Its core activities include the design and construction of large civil engineering projects, the development and operation of transport concessions such as toll roads and airports, and the provision of urban and industrial services and maintenance. The company typically operates through long-term concession and public-private partnership models, combining construction expertise with asset management and operations.
Within its operating model, Ferrovial's business spans construction contracting, concession management and services.
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