Abertis Infraestructuras S.A.
Annual Report 2004

Plain-text annual report

Annual Report 2004 Key data (million euros) Consolidated Total assets Equity Provisions Debt Operating income EBITDA - Gross operating margin (1) Operating profit Net profit attributed to parent 2000 4,091 1,721 816 2001 4,267 1,765 897 1,154 1,227 550 385 296 163 710 476 359 172 2002 6,459 2,033 1,402 2,521 794 534 402 195 2003 9,685 3,107 2,320 3,611 1,283 915 695 355 2004 9,940 3,318 2,493 3,516 1,534 1,043 743 467 Average number of employees 2,897 3,209 3,990 4,617 5,504 Parent company Net profit Total dividends 156 125 165 132 183 156 329 237 361 264 (1) Operating income (excluding activation) less operating expenses (excluding depreciation and provisions). What resources are used? Resources abertis Group - Distribution of assets Human resources Average workforce Fixed assets Other assets Current assets 12,000 10,000 8,000 6,000 4,000 2,000 0 6,000 5,000 4,000 3,000 2,000 1,000 0 2000 2001 2002 2003 2004 2000 2001 2002 2003 2004 The group’s assets exceed 9,900 million euros An workforce team of more than 5,500 Increase due to inclusion of retevisión. Fixed assets, basically in highways and other assets under concessions, represented 84.1% of total assets. The growth of the group has seen the average workforce grow from 2,897 in 2000 to 5,504 in 2004. (Please turn over) What are the financial resources? What is obtained? abertis Group - Breakdown of liabilities Profit attributed to parent company Equity Provisions for liabilities and expenses Debt Other liabilities 12,000 10,000 8,000 6,000 4,000 2,000 0 500 400 300 200 100 0 2000 2001 2002 2003 2004 2000 2001 2002 2003 2004 Balanced financial structure Equity, which exceeds 3,300 million euros, represents 33% of total liabilities and debt is 35%. The provisions for liabilities and expenses, which basically correspond to the reversion fund, exceed 2,400 million euros. Profit has increased from 163 million euros in 2000 The Group’s growth has been compatible with increasing profits. The profit of 467 million euros represents a rise of 31.6% compared to 2003. How are profits distributed? How is it valued? Total dividends Evolution abertis vs Ibex 35 (Base 31/12/99 = 100) 300 250 200 150 100 50 0 abertis shere price IBEX 35 220 200 180 160 140 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 2000 2001 2002 2003 2004 One of the highest dividend yields abertis: excellent performance With a final dividend of € 0.25 per share, total dividends in 2004 exceed 264 million euros (11.3% more than 2003), with the policy of a steady and sustainable dividend payout being maintained. The shares of abertis rose 42% in 2004. This increase is in addition to the rises recorded in the four previous years, with an accumulated increase of 114% in this five year period. Only three of the 35 companies in the Ibex Index have recorded annual increases in these five years, with abertis being one of them. The Ibex 35 rose 17.4%, but continues to remaning below its closing level of 1999 (change over last five years: -22%). Significant events of the year 1st quarter 2004 • abertis completes through bonus share issue approved in April • Approval from the boards of directors of abertis and iberpistas for the merger of the two companies (effective for accounting purposes from 1 January 2004). • Award of the Alicante Ring Road concession for a period of 36 years to a consortium in which abertis holds a 25% share. • Inauguration of the R-3 and R-5 radials of Madrid in which abertis holds 23.3% under concession until 2049. • Bond issue of €450 million to insitutional investors with a 10 year maturity and coupon of 4.75%. 2nd quarter 2004 • The Ordinary Shareholders’ Meeting of aber tis approves the 2003 the financial statements for 2003 a final dividend of € 0.223 per share, the bonus share issue against profits of one new share for changed every 20 shares held and the merger by absorption with iberpistas. for 78.8 million euros. • Sale by Schemaventotto (in which abertis holds 12.83%) of 10% in Autostrade to institutional investors, reducing its shareholding from 62.2% to 52.2% and generating a capital gain for abertis of 60 million euros. The indirect shareholding of abertis in Autostrade fell from 7.98% to 6.69%. • Autostrade sells 4.98% that it held in abertis to “la Caixa” and ACS in equal amounts, generating capital gains for abertis (through its shareholding in Autostrade) of 10 million euros. • saba acquires 100% of two car parks in Chile through Saba Chile. • The international credit agency Standard & Poor’s assigns an “AA-“ classification to abertis with Outlook stable. • abertis increases its international presence in the sustainability indexes on being included in the Dow Jones Sustainability World index and remaining, for its second year, in the Dow Jones Sustainability Index Stoxx. • Barcelona City Council and saba agree on a new rate 4th quarter 2004 structure charging by 5 minute intervals, the introduction of automatic tellers and a rate increase. In addition, saba agree to make investments in the areas of safety and environmental control and obtained an extension on the concession for 4 car parks until 2016. • Acquisition by saba of a concession of 4 car parks in Santiago de Chile until 2035 with a possible 6 year extension. • On 5 May payment of the final dividend for 2003 was made, for a total sum of 117 million euros. • abertis and iberpistas conclude their merger with the share exchange fixed as one Class A abertis share for each Iberpistas share. Due to the small number of shares to be exchanged, no specific capital increase was made. Instead treasury stock was exchanged (prior authorisation being given for the acquisition by the Shareholders’ Meeting). 3rd quarter 2004 • The international credit agency Fitch Ratings mantains its “A+” classification for abertis and an “F1” rating for short-term debt. • Approval of Ausol APE. The Acuerdo Preventivo Extrajudicial (out-of-court settlement agreement) (APE) is approved and signed between Ausol and its creditors whereby Ausol reduced its debt from 599 to 382 million dollars, the conditions on the debt were revised and it ceded 30% of its share capital to the former bondholders. As a result of this operation, abertis saw its shareholding in Ausol reduced from 45.2% to 31.6%. • Agreement of Xfera with the Ministry of Industry with respect to the new plan to launch UMTS whereby the guarantees presented by Xfera are reduced from 468 to 176 million euros. • retevisión increases its shareholding in Torre de Collserola to 41.75%, becoming the core shareholder. • Distribution of interim dividend for 2004 of 0.229 euros per share. • abertis increases its shareholding in Schemaventotto, acquiring the 0.5% shareholding of the Portuguese highway operator Brisa. Following this operation, the indirect shareholding of abertis in Autostrade increased to 6.95 %. • abertis concludes a private placement of bonds on the US market of 600 million dollars, with maturities of 7, 10, 12, 15 and 20 years and an equivalent cost of the interbank interest rate plus 35 basis points. • abertis approves a fixed income debt program for 700 million euros, to be issued during 2005. • Agreement of Working Group on Reordering Tolls of Catalonia with the approval of a new system for rate revisions, a new discount based on peak hour traffic and a new system of discounts based on individual use. • ACDL (with 90% held by abertis and 10% by Aena Internacional) acquired in December 2004 29% of TBI and launched a public takeover offer for 100% of the capital. TBI is a British airport operator that manages, under concession or ownership, 8 international airports (including London Luton, Cardiff and Belfast). In January 2005 the public takeover offer was concluded, with ACDL securing 100% of the capital. • The Board of Ministers meeting on 30 December agreed to modify the National Technical Plan for Digital Television before summer 2005, to assign as soon as possible the frequencies currently free for new programs, to begin the broadcast of new programs with state coverage in autumn 2005 and brought forward the limit for the transition to Terrestrial Digital Television (from 2012 to 2010). Annual Report 2004 Index Chairman’s Letter 1 Governing Bodies 1.1. Board of Directors 1.2. Delegated Board Committees 1.3. Management Team 1.4. Business Units 2 3 Strategy Structure and Activity 3.1. Structure 3.2. Human Resources 3.3. Activity for the year Highways Car parks Logistic services Telecommunication infrastructures Airports 3.4. Economic performance for the year Consolidated figures Parent company figures 4 abertis on the Stock Exchange 4.1. Stock market conditions 4.2. abertis shares 4.3. Evolution of share capital - Share issues 4.4. Dividend and shareholder yield 4.5. Shareholders 4.6. Significant shareholdings 4.7. Market information 5. Financial Information 5.1. Consolidated Annual Accounts Consolidated Management Report Consolidated Auditor’s Report 5.2. Parent Company Annual Accounts Parent Company Management Report Parent Company Auditor’s Report 004 010 011 012 013 015 018 019 021 023 035 038 041 045 046 046 048 052 052 054 054 055 055 056 058 108 111 114 115 115 004 Chairman’s Letter Annual Report 2004 Chairman’s Letter 005 Dear Shareholders, Once again I have the opportunity to address you in the Annual Report of abertis on the performance for 2004. This year has been characterised fundamentally by a positive evolution of activity across the different business sectors and also by the firmness with which we have progressed towards the consolidation of two areas in our Group –telecommunications infrastructures and airports– through the completion and initiation of corporate operations that consolidated our strategy of growth in new activities. Throughout the year the financial markets and the indices that abertis forms part of have evaluated our performance very favourably and at year end our share price had increased by 42%. The Board of Directors has raised the normal dividend and recommended a final dividend of €0.25 gross per share to the Shareholders’ General Meeting, making a total dividend of €0.479 per share for 2004, charged against profits for the year. The dividend amount exceeds 264 million euros, which represents an increase of 11%, due to the higher final dividend and the larger number of shares following the bonus share issue of 1 new share for every 20 shares held, in line with the established policy of abertis on shareholder return. The Spanish macroeconomic setting where our activity is carried out has been characterised by dynamic internal demand, which was up 4.2% on the previous year, and stable growth in construction activity, at a level of 4.4%, which has played an important role in the growth of the Spanish economy. The Gross Domestic Product (GDP) in Spain grew by 2.7% in 2004. The world economy in 2004 recorded its highest growth rate in the last thirty years, at 5%, according to the IMF. The two world economic motors, the United States and China, have shown an enviable rhythm of growth, acting in a near perfect tandem: the United States has been consuming and investing at a stable rhythm and high level for more than one year and China acts as the second world supplier for the North American giant, after Canada. The negative surprise comes from Japan, which has experienced a slowdown in its growth. The European Union continues to have low growth rates and only the United Kingdom and France stand out, amongst the large European economies, with growth rates of 3.1% and 2.3% in 2004. In this macroeconomic situation, abertis has made a net profit of 467 million euros in 2004, which represents an increase of 31.6% over the previous year. Excluding the impact of the one-off capital gains of 70 million euros, derived from the shareholdings in Italy, the net profit would have been 397 million euros, up 11.8% on 2003. The acquisition of the British airport operator TBI is not included in the profit and loss account of abertis for 2004, as the public takeover offer made to acquire this company was completed in 2005 and at the close of the financial year the investment in TBI by the consortium ACDL –90% abertis and 10% Aena– represented 29.2% of the airport operator, so it was included in the 2004 consolidated accounts by equity accounting. Operating income rose 20% to 1,543 million euros. This growth reflects the positive performance of the combined activities and in particular the highway sector, where the Average Daily Traffic indicator (ADT) showed a 3.4% increase, rising to 28,283 vehicles for the combined highway network of abertis in Spain. Internationally, the performance of the Argentinean concessionaire of abertis, GCO, is notable with a 12.5% increase in traffic. The highway activity represents 74% of total income for the business group. The increase in income also reflects the inclusion of retevisión in the consolidation scope since December 2003. 006 Chairman’s Letter In the other business sectors, activity has also evolved favourably, as you will see outlined in this Annual Report. This performance, together with the policies of efficiency employed throughout the year and the notable increase in one-off capital gains previously mentioned in Italy, resulted in gross operating earnings before interest, tax, depreciation and amortisation (EBITDA) in 2004 of 1,043 million euros, an increase of 14% on the figure for 2003. Net cash flow was 706 million euros, an increase of 19%. Strategy and growth Our business model is based on the main objective of continuing to provide our shareholders with a balanced combination of investments that simultaneously provide low risk, growth and profitability, and the maintenance of a policy of solid and sustainable dividends. New investments for growth are selected in accordance with four key elements of interest to abertis: investments in the area of infrastructure management; in businesses that offer a long term perspective and provide an opportunity to have a significant presence in the decision-making bodies; investments that show the potential for development through the employment of management knowledge that abertis has built up over time, and finally, investments in projects where the risks and expected cash flows can be clearly estimated at the outset. The events show that we have strictly followed these principals during 2004. Beyond the organic growth of our more mature businesses, namely the highway and car park sectors, this year we have dedicated our efforts to the growth and consolidation of those business areas that were only timidly announced a little over eighteen months ago, but now provide low risk, growth, profitability, future perspective and long term vision. With these new investments we must be able to take advantage of the Company’s capacities in the management of infrastructures, incorporating other business, not as traditional as highways, so that they gain a greater dimension to complement those businesses that today are the motor of resource generation. In this regard, in the telecommunication infrastructures area the full incorporation of retevisión in the structure of abertis telecom was important in 2004. From 1 January 2004 we worked hard on its integration so that tradia and retevisión can develop their full growth potential in the future, with maximum efficiency, both through international expansion and the development of services for closed user groups using specific networks. In addition, abertis telecom is actively working on the development of digital TV and radio with the aim of promoting the launch of DTT in Spain. With respect to new investments, this year has been marked by the public takeover offer made in November for the British airport operator TBI by the company Airport Concessions and Development Limited (ACDL), the consortium between abertis (90%) and Aena (10%). The operation was completed in 2005 with TBI being delisted from the London Stock Exchange and the process concluded with the compulsory purchase of minority shareholdings (squeeze out). The acquisition of the airport operator represents the entry of abertis in 14 international airports -8 under ownership or concession and 6 under management for government or local authorities- and the incorporation of more than 18 million clients around the world. With this operation, at a cost of 788 million euros, (709 million for 90%) abertis undertook a significant investment opportunity that allows it to gain critical mass in the airport sector, strengthen its position as a manager of all types of infrastructures and maintain a policy of solid and sustainable growth in shareholder return. Projections for 2005 indicate that the acquisition of TBI will increase turnover of abertis by 17%, whilst consolidating activity in the airport sector, which will be similar in scale to Telecommunication Infrastructures, representing some 15% of income. Annual Report 2004 Chairman’s Letter 007 The alliance of abertis with Aena will provide us with valuable knowledge in airport sector management, which we consider strategic to confirm our leadership as a global manager of infrastructures for mobility and communications. Without a doubt, we are preparing for the future with this operation. In any event, TBI also represents an essential step in our process of internationalisation. Now we must work with the mentality, ambition and projection of a multinational company. We have also moved forward in the international expansion in the car park area, centred primarily in the Latin American market (Chile), with the acquisition of six car parks located in Santiago de Chile and Concepción. This is a milestone that reaffirms the effort made by saba in its international expansion over the last five years, investing in a country where abertis is already present in the highway sector. We have strengthened our car park projects in Italy and Portugal, with significant improvements in their results and new investments, primarily in Italy. In 2005, saba has taken control of 100% of its Italian subsidiary, Saba Italia, after purchasing the 40% share held by Autostrade. The car park sector represents 6% of income for abertis. With respect to new investments and projects in the highway sector, the award of the 36-year concession on the Alicante Ring Road, which can be extended to 40 years, to a consortium in which abertis holds 25% through aumar, is particularly important. In the area of logistic infrastructures, this has been a year of development for projects at different stages of maturity, located in Barcelona, Alava and Seville. Of special note were the works carried out in Zal Seville, which constructed Phase I with 32,000 square metres of warehousing in 2004. Similarly, work has commenced at the platform in Álava, Arasur, on levelling for the first phase. Corporate Governance and Social Responsibility abertis has also published the corresponding annual reports on Social Responsibility and Corporate Governance. The Social Responsibility Report has been prepared following the criteria established by the Global Reporting Initiative (GRI), an organisation that has established the guide to reporting on economic, environmental and social performance, and the number of indicators employed by abertis has even increased, providing evidence of the real willingness that social responsibility is an efficient instrument for the overall management of the entire Group, which proposes and promotes the incorporation of best practices for each business unit. As for Corporate Governance, in 2004 all the regulatory instruments that comply with the working framework of the various governance bodies of the Company have been put into practice. The Annual Corporate Governance Report has been prepared strictly in accordance with the new model, whereby it is comparable in form to the other listed companies. Finally I wish to express my thanks to management, employees and suppliers for their dedication. And to you, the shareholders, for your confidence. We will carry on working so that we continue to deserve your confidence in the future. Isidre Fainé, Chairman of abertis 1 Governing Bodies 1.1. Board of Directors 1.2. Delegated Board Committees 1.3. Management Team 1.4. Business Units 010 1. Governing Bodies - 1.1. Board of Directors 1.1. Board of Directors The members of the Board of Directors of abertis, at the time of preparing the 2004 Annual Accounts are: Isidro Fainé Casas (Chairman) Pablo Vallbona Vadell (1st Deputy Chairman) Carmen Godia Bull (2nd Deputy Chairman) Ángel García Altozano (3rd Deputy Chairman) Salvador Alemany Mas (Chief Executive Officer) Caixa d’Estalvis de Catalunya, represented by Josep Mª Loza Xuriach Comunidades Gestionadas, S.A., represented by Antonio Garcia Ferrer Enrique Corominas Vila Dragados, S.A., represented by Demetrio Ullastres Llorente Maria Isabel Gabarró Miquel Carlos Godó Valls Miguel Ángel Gutiérrez Méndez Ernesto Mata López Enric Mata Tarragó Vasco de Mello Jorge Mercader Miró José Luis Olivas Martínez Ramón Pascual Fontana Unicaja, represented by Braulio Medel Cámara Miquel Roca Junyent (Secretary, Non Board Member) Juan A. Margenat Padrós (Deputy Secretary, non-board Member) In 2004 the following have ceased to act as Board Members: Julio de Miguel Aynat, Grupo Dragados, S.A., Dragados Concesiones de Infraestructuras, S.A., Gilberto Benetton and Jordi Aristot Mora. Annual Report 2004 1. Governing Bodies - 1.2. Delegated Board Committees 011 1.2. Delegated Board Committees Executive Committee Isidro Fainé Casas (Chairman) Pablo Vallbona Vadell (1st Deputy Chairman) Carmen Godia Bull (2nd Deputy Chairman) Ángel García Altozano (3rd Deputy Chairman) Salvador Alemany Mas (Chief Executive Officer) Caixa d’Estalvis de Catalunya, represented by Josep Mª Loza Xuriach José Luis Olivas Martínez Miquel Roca Junyent (Secretary, Non-Board Member) Juan A. Margenat Padrós (Deputy Secretary, Non-Board Member) In 2004 the following have ceased to act as Committee Members: Dragados Concesiones de Infraestructuras, S.A.and Julio de Miguel Aynat Audit And Control Committee Ernesto Mata López (Chairman) Caixa d’Estalvis de Catalunya, represented by Josep Mª Loza Xuriach Enrique Corominas Vila Juan A. Margenat Padrós (Secretary) Nomination And Remuneration Committee Jorge Mercader Miró (Chairman) Maria Isabel Gabarró Miquel Ángel García Altozano Juan A. Margenat Padrós (Secretary) 012 1. Governing Bodies - 1.3. Management Team 1.3. Management Team Chief Executive Officer: Salvador Alemany Mas Company Secretary: Juan Arturo Margenat Padrós Director of Legal Services: Marta Casas Caba Managing Director of Corporate Management: Josep Martínez Vila Director of Operational Development: Manuel Cruzado de la Hera Director of Investment Analysis: David Díaz Almazán Director of Tax Planning: José María García Martín Director of Corporate Security: Lluís Jiménez Arrebola Director of Management Planning and Control: Jordi Lagares Puig Director of Organisational Development: Joan Rafel Herrero Director of Construction: Rodolfo Vicente Bach Chief Financial Officer: Miguel Abeniacar Trólez Director of Finance: Lluís Subirà Laborda Director of Institutional Relations and Quality: Ricard Maxenchs Roca Director of Studies and Corporate Communication: Enric Venancio Fillat Shared services Managing Director of serviabertis: Josep Padrós Busquets Deputy Managing Director of Infrastructures and Technical Services: Juan Rodríguez de la Rubia Director of Administration and Purchasing: Manuel Cruces Socasau Director of Corporate Organisation and Systems: Jordi Pujol-Xicoy Gimferrer Annual Report 2004 1. Governing Bodies - 1.4. Business Units 013 1.4. Business Units Highways Director of International Highways: Jordi Graells Ferrández Managing Director Catalonia-Aragon (acesa and aucat): Lluís Serra Serra Managing Director East-South (aumar): Américo Jiménez Rodríguez Managing Director Centre-North (iberpistas): José María Morera Bosch Car parks Managing Director of saba: Joan Font Alegret Logistic services Managing Director of abertis logística: Joaquim Gay de Montellà Ferrer-Vidal Telecommunication infrastructures Managing Director of Business and Operations abertis telecom: Tobías Martínez Gimeno Managing Director of Development and Resources abertis telecom: Josep Canós Ciurana Airports Managing Director of Airports: Miquel Puig Raposo 2 Strategy Annual Report 2004 2. Strategy 015 2. Strategy abertis is firmly committed to being one of the leading groups in Europe in the management of infrastructures serving mobility and communications, with the objective of continuing to provide its shareholders whith a balanced combination of investments that ensures: • An appropriate combination of low risk, growth and return To achieve this, the selection of its investments is based on the following key lines: • Area of infrastructure management • Commitment to long-term investment, ensuring a significant presence in the decision-making bodies • Contributing to the management knowledge that • Maintenance of a solid and sustainable dividend abertis has built up historically policy • Involvement in projects where the overall risks and expected cash flow can be clearly estimated at the outset In the Social Responsibility Report and the Corporate Governance Report included together with this Annual Report, the actions of the Group in these areas are outlined in detail. whilst developing an organisation model that: • Seeks excellence in the quality of service to its clients • Brings wealth and well-being to the area where its activities are carried out • Strives for adequate integration and projection of its employees within the organisation • Dedicates special attention to the requirements of transparency in matters concerning Corporate Governance 3 Structure and Activity 3.1. Structure 3.2. Human Resources 3.3. Activity for the year Highways Car parks Logistic services Telecommunication infrastructures Airports 3.4. Performance for the year Consolidated figures for abertis Figures for the parent company abertis 018 3. Structure and Activity - 3.1. Structure 3.1. Structure Corporate Services Abertis Infraestructuras serviabertis A.I. Finance BV Subsidiary companies Highways acesa aumar iberpistas aucat castellana Aulesa GCO APR Gesa Proconex Car Parks Logistic Services Telecommunications Airports abertis logística Sevisur abertis telecom retevisión tradia TBI Codad saba Parbla Saba Italia Spel Saba Chile Spasa Satsa Rabat Joint venture companies Highways Avasa Trados 45 Associated companies Car Parks Logistic Services Telecommunications Airports Parc Logístic Areamed 2000 Highways Car Parks Logistic Services Telecommunications Airports Cilsa Arasur Torre de Collserola Túnel del Cadí Autema Accesos de Madrid Concema Henarsa Central Gallega Ciralsa Autostrade Brisa Coviandes Ausol RMG Elqui Annual Report 2004 3. Structure and Activity - 3.2. Human Resources 019 3.2. Human Resources The abertis Group has become increasingly complex with the incorporation of new businesses. In this context, an employee team willing to participate in the construction of a common project becomes an essential factor in order to achieve the business objectives. At the same time as the abertis Group has been growing in size, it has also become more diverse. The contribution of diverse cultural awareness, fruit of the mergers and acquisitions in recent years, is a competitive advantage that we should know how to capitalise on. Furthermore, the necessity already noted last year to perfect the levels of coordination and identify synergies, has continued to be the key for some of the initiatives developed this year, through the collaboration of the Business Units, serviabertis and abertis. Some of these initiatives, which are the result of the combined work of the Business Units, serviabertis and abertis, are outlined below: Internal communication Establishment of an Internal Communication Plan designed to support the integration of the different sensitivities of the abertis Group, seeking an increase in internal cohesion. It also endeavours to boost the information flow between the companies and organisational structures of the Group so that it is more dynamic and relevant, as well as establishing an open and accessible communication model. Rule book Development of rules that give the abertis Group a frame of reference designed to clarify and establish decision making areas and actions in the relationships between the different organisational structures of the Group, and consequently the relationships between employees. Human Resources Information System Management by objectives system This year the Process of Management by Objectives and Evaluation of Achievements has been extended to all companies in the abertis Group with the aim of improving results and the development of employees. The intention is to encourage a culture of dialogue, personal responsibility and continuous improvement. The process is oriented, not just to ward the achievement of specified quantitative objectives, but also seeks to align employees with the desired values, through the evaluation of individual performance. Designed to give the abertis Group an infrastructure for the management of common processes in Human Resources, providing a technological platform that enables the directors of Human Resources and other directors to manage their teams with greater agility, allowing faster and more effective decision making in matters related to the management and development of employees. Global position structures The implementation of a common methodology and language has been sought for the abertis Group to standardise the process of position descriptions and classifications in the workplace. With this common base we simplify the comparative analysis between the different Business Units regarding the structure of positions, whilst facilitating the harmonious development of remuneration policies and providing the companies with a base on which they can build competence models. 020 3. Structure and Activity - 3.2. Human Resources Vision, Values and Model of Governance corporation, to facilitate its evolution as a cohesive group. Consequently, this process aims to: Begun in the last quarter of 2004, the Proyecto de Reflexión Organizativa (Organisational Reflection Project) of abertis, PROA, considers questions of particular relevance, due to the growth experienced by the abertis Group and the significant increase in organisational complexity. In short, the project seeks to clarify and promote the new Corporate Values of the Group, redefining them in a simple and clear manner to create the basic pillars and guiding principles for management of the entire • Identify the new core elements of the common Group vision that are used to build the corporate structure, covering the strategic objectives and management styles of the Group. • Adjust the Group’s Governance Model to optimise the management framework and the relationship between Corporate Services and the Business Units. Evolution of average number of employees abertis serviabertis acesa Group iberpistas Group aumar Aulesa Trados 45 saba Group abertis telecom Group abertis logística Group Codad Total (1) 2004 93 112 2,014 499 643 51 1 899 1,295 14 47 2003 101 74 1,951 669 665 49 1 920 257 11 43 5,668 4,741 (1) The total average staffing level does not coincide with the figures provided in the notes to the Annual Accounts due to criteria for consolidated accounts (5,504 employees in 2004). During 2005, ACDL (90% owned by abertis) has completed the public takeover offer for the shares of the TBI group, obtaining 100% of the capital. Its employees were not included in the calculation of average number of employees above. Taking TBI into account, average number of employees would increase by almost 2,000 employees. Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 021 3.3. Activity for the year A summary of the contribution made by each sector of activity to the key operating figures is shown below. Contribution to operating income and EBITDA by sectors: Operating income 1% Logistics 6% Car Parks 74% Highways 2004 EBITDA 0% Logistics 3% Car Parks 86% Highways 2004 Operating income by origin: 95% National 2004 17% Telecommunications 1% Logistics 2% Airports 7% Car Parks 85% Highways 2003 9% Telecommunications 1% Logistics 2% Airports 5% International 3% Car Parks 92% Highways 2003 94% National 2003 5% Telecommunications 2% Airports 2% Telecommunications 2% Airports 6% International The inclusion of retevisión at the end of 2003 has changed the relative weight of the contribution of the telecommunications sector, also increasing the weight of business in Spain. The inclusion of the figures of TBI (and their resulting impact on the current contributions) will not take effect until 2005. 022 3. Structure and Activity - 3.3. Activity for the year Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 023 Highways The business unit for the operation of highway concessions continues as the main activity of abertis and represents 74% of the total operating income and 86% of EBITDA. The Group manages important concessions at both national and international levels. The current portfolio of concessions presents an excellent combination, both geographically and in terms of project maturity (from mature concessions to projects under construction or in the initial phase of activity), which ensures a balanced combination of future cash flows for shareholders. At the national level, the highways business unit is structured into three geographical areas, headed by the operators that historically have been the main companies in Spain: Catalonia-Aragon area through acesa, Centre-North area through iberpistas and East-South area through aumar. Direct or shared management Catalonia - Aragon Centre-North East - South International acesa aucat iberpistas castellana Aulesa Proconex Avasa Trados 45 aumar GCO APR Gesa Other shareholdings Catalonia - Aragon Centre-North East - South International Túnel del Cadí Autema Concema Ciralsa Accesos de Madrid Henarsa Central Gallega Autostrade Brisa Coviandes Ausol RMG Elqui 024 3. Structure and Activity - 3.3. Activity for the year Spain In Spain, abertis directly manages more than 1,500 km of highways, which represents 60% of the national toll highway network in operation. Aulesa Central Gallega Avasa acesa Túnel del Cadí Autema acesa aucat Santiago Alto de Santo Domingo León Astorga Bilbao Zaragoza Segovia Adanero Ávila Guadalajara Madrid Navalcarnero Arganda del Rey La Jonquera Palafolls Barcelona Tarragona Seville Cadiz iberpistas castellana Concema Trados 45 Accesos de Madrid Henarsa Valencia Alicante aumar acesa aumar Direct or shared management Other shareholdings Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 025 Aulesa León-Astorga (AP-71): 38 km Central Gallega Santiago-Alto de Sto. Domingo (AP-53): 57 km Santiago de Compostela AP-53 Silleda Alto de Sto. Domingo Ourense León Villadango Hospital de Órbigo Astorga AP-71 aumar Seville-Cadiz (AP-4): 94 km Seville AP-4 Jerez de la Frontera Cadiz Direct or shared management Other shareholdings 026 3. Structure and Activity - 3.3. Activity for the year acesa Montgat-Palafolls (C-31/C-32): 49 km La Jonquera-Barcelona (C-33/AP-7): 150 km Montmeló-El Papiol (AP-7): 27 km Túnel del Cadí Túnel del Cadí (C-16): 30 km Autema Sant Cugat-Manresa (C-16): 48 km La Jonquera C-16 Túnel de Cadí AP-7 Girona Manresa C-16 Sant Cugat del Vallès El Papiol Hostalric AP-7 Montmeló Palafolls Arenys de Mar Mataró Montgat C-33 Barcelona C-31/C-32 acesa Barcelona-Tarragona (AP-2/AP-7): 100 km AP-2 Martorell Vilafranca del Penedès AP-7 Tarragona El Papiol Mediterrani El Vendrell Torredembarra Barcelona aucat Castelldefels-El Vendrell (C-32): 58 km Gavà C-32 Castelldefels El Vendrell Sitges aumar Tarragona-Alicante (AP-7): 374 km Tarragona L'Hospitalet de l'Infant Peñíscola Castellón Villareal Valencia AP-7 Gandia Benidorm Alicante Direct or shared management Other shareholdings Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 027 Avasa Bilbao-Zaragoza (AP-68): 294 km Bilbao Vitoria Gasteiz Armiñón Logroño AP-68 Tudela Zaragoza acesa Zaragoza-Mediterráneo (AP-2): 216 km Alfajarín Zaragoza AP-2 Lleida Montblanc Mediterrani iberpistas Villalba-Adanero (AP-6): 70 km castellana Villacastín-Ávila (AP-51): 23 km San Rafael-Segovia (AP-61): 28 km Concema M-45 Stretch I: 14 km Trados 45 M-45 Stretch II: 15 km Acceso Madrid Madrid-Arganda del Rey (R-3): 33 km Madrid-Navalcarnero (R-5): 53 km Henarsa Madrid-Guadalajara (R-2): 81 km Adanero AP-61 AP-51 Ávila Navalcarnero Segovia AP-61 San Rafael Villalba Madrid R-5 R-2 Guadalajara R-3 Arganda del Rey M-45 Stretch II M-45 Stretch I Direct or shared management Other shareholdings 028 3. Structure and Activity - 3.3. Activity for the year Highways under direct or shared management km Concessionaire % holding End concession Catalonia – Aragon Area Montgat-Palafolls (C-31 / C-32) Barcelona-La Jonquera (AP-7) Barcelona-Tarragona (AP-7) Montmeló-El Papiol (AP-7) Zaragoza-Mediterráneo (AP-2) Castelldefels-El Vendrell (C-32) Centre-North Area Villalba-Adanero (AP-6) Villacastín-Ávila (AP-51) San Rafael-Segovia (AP-61) León-Astorga (AP-71) Bilbao-Zaragoza (AP-68) Stretch II (M-45) East-South Area Tarragona-Alicante (AP-7) Seville-Cadiz (AP-4) acesa 100% 2021 aucat 100% 2039 iberpistas castellana Aulesa Avasa Trados 45 100% 100% 79.2% 50.0% 50.0% 2031-2036 2031-2036 2055 2026 2029 aumar 100% 2019 49 150 100 27 216 58 70 23 28 38 294 15 374 94 1,534 Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 029 Activity In general, the evolution of activity on the main concessions of the Group has been positive, with all of them recording increases in traffic. The comparable combined average daily traffic (ADT) (acesa, aucat, aumar, iberpistas and Avasa) reached 28,283 vehicles, up 3.4% on the previous year. Key data for the highway companies under direct or shared management Concessionaire acesa aumar iberpistas castellana aucat Aulesa Avasa Trados 45 ADT 2004 39,569 24,141 30,301 5,327 28,922 Var. 2.7% 3.5% 5.3% 5.7% 5.2% Operating income 537,567 325,282 101,646 7,474 79,033 3,749 (12.3%) 4,117 Thousand euros Var. 6.0% 7.0% 9.0% 19.0% 9.0% (4.0%) EBITDA 414,304 275,325 80,258 3,215 66,359 1,601 13,503 73,969 5.1% 0.7% 127,936 8.0% 104,054 21,853 12.0% 20,465 Var. 7.0% 7.0% 5.0% 36.0% 9.0% (6.0%) 9.0% 14.0% The other concessions under direct management (castellana, Aulesa and Trados 45) are in the early phase of their activity, so their data do not reflect the real level of future activity. castellana inaugurated the Ávila- Villacastín stretch in November 2002 and the San Rafael-Segovia stretch in April 2003. In addition, Trados 45 (under shadow toll) and Aulesa opened to traffic in April and December 2002, respectively. During 2004 construction work has begun on the third tunnel of Guadarrama on behalf of castellana. This is an important project that will allow capacity to increase on the AP-6 highway and the corridor of access from the centre of the Peninsula to the north-east of Spain (Castilla-León, Asturias and Galicia). The companies of the abertis Group are investing in the implementation of dynamic toll systems, tele-toll, both for light and heavy vehicles, which will lead to a better service for clients due to its speed and convenience. 030 3. Structure and Activity - 3.3. Activity for the year Volume of business The national highway concessions under direct management represent 72.1% of the Group’s total operating income, reaching 1,107 million euros, 6% more than the previous year. This increase is due to the positive evolution of activity on the national highways previously mentioned. The EBITDA of those highways was 893 million euros, an increase of 8% compared to 2003. Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 031 Other shareholdings abertis also has shareholdings in the following concessionaire companies, but not a majority interest. Túnel del Cadí (C-16) Stretch I (M-45) Alicante Ring Road Madrid-Arganda del Rey (R-3) Madrid-Navalcarnero (R-5) Madrid-Guadalajara (R-2) Sant Cugat-Manresa (C-16) Santiago-Alto Sto. Domingo (AP-53) km Concessionaire % holding End concession 30 14 48 33 53 81 48 57 Túnel del Cadí Concema Ciralsa Accesos Madrid Henarsa Autema Central Gallega 37.2% 25.0% 25.0% 23.3% 22.5% 22.3% 18.0% 2023 2032 2040 2049 2024 2037 2074 Autema, Túnel del Cadí and Concema have continued to evolve positively, with increases in traffic and income that have boosted their contribution to the final consolidated result. During the year abertis was awarded, through the 25% shareholding of aumar, the toll highway concession for the Alicante Ring Road (Ciralsa), which is currently under construction. The other companies are in the early phase of operations: Henarsa commenced its activity in October 2003, the Central Gallega highway, in phases completed, in December 2002, December 2003 and June 2004, and Accesos de Madrid in February 2004. The combined result of these shareholdings is positive and contributes 4 million euros to the consolidated result of abertis. 032 3. Structure and Activity - 3.3. Activity for the year International abertis has shareholdings in a series of international projects as shown on the following map: It also maintains international strategic alliances with the main European operators: Brisa, Autostrade and ASF. Gloucester Cirencester Sawtry Swindon Alconbury London United Kingdom RMG A1-M Alconbury 21 km RMG A419/417 Swindon-Gloucester 52 km Portugal Brisa 1,106 km Oporto Lisbon Genoa Rome Naples San Juan Puerto Rico APR Teodoro Moscoso Bridge 2 km Santafé de Bogotá Italy Autostrade 3,408 km Santafé de Bogotà La Serena Ovalle Los Vilos Villavicencio Colombia Coviandes Bogotá-Villavicencio 86 km San Fernando San Isidro Buenos Aires Luján Buenos Aires Santiago Buenos Aires Chile Elqui Los Vilos-La Serena 229 km Argentina GCO Luján-Buenos Aires 56 km Ausol North access to Buenos Aires 119 km Direct management Other shareholdings Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 033 Highways managed directly Country Argentina Puerto Rico (*) 57.6% of voting rights. Other shareholdings Country Argentina Colombia United Kingdom United Kingdom Chile Portugal Italy Concessionaire % holding GCO APR 48.6%(*) 75% km 53 2 End concession 2018 2027 Concessionaire % holding Ausol Coviandes RMG RMG Elqui Brisa Autostrade 31.6% 39.0% 25.0% 25.0% 25.0% 10.0% 6.95% km 119 86 22 52 229 1,106 3,401 End concession 2020 2013 2026 2026 2022 2032 2038 In general, the evolution of the activity internationally has been very positive, with significant increases in traffic and income. The recovery of the Argentine economy stands out, having begun in 2002 and strengthened during 2003 and 2004, resulting in a 13% increase in transits of GCO and a 14% rise in income, resulting in a profit in 2004 that was up 50% on 2003. This recovery, and the anticipated renegotiation of the concession contracts with the administrations that awarded them, gives an optimistic outlook for the evolution of the highway concessions that abertis has in Argentina. During 2004 Schemaventotto (company that groups together the core shareholders of Autostrade) sold 10% of Autostrade, reducing its shareholding from 62.2% to 52.2%. In addition, Acesa Italia increased its shareholding in Schemaventotto to 13.33%, after the acquisition of the 0.5% holding of the Portuguese operator Brisa. The final indirect shareholding of abertis in the Italian concessionaire is 6.95%. The capital gains obtained from the sale by Schemaventotto of 10% in Autostrade and from the sale by Autostrade of 5% in abertis resulted in extraordinary income of 70 million euros for abertis. 034 3. Structure and Activity - 3.3. Activity for the year Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 035 Car parks Saba Aparcamientos S.A. (saba), the leading operator in the car parks sector in Spain and one of the leaders in Europe, is the head of the business unit in this sector of activity. Key data for car park companies Company Country % holding No. spaces saba Parbla Spel Spasa Satsa Saba Italia Saba Chile Rabat Activity Spain Spain Portugal Andorra Spain Italy Chile Morocco 99.2% 100% 100% 90% 88.0% 60.0% 100% 51.0% 39,791 4,428 15,831 295 931 11,949 2,464 3,318 79,007 No. cities present 26 13 6 1 1 11 2 1 61 The Group manages more than 79,000 parking spaces, distributed across a total of 145 operating units and is present in more than 60 cities. The good overall performance of the activity of group companies during the year resulted in a 4.1% increase in vehicle rotation, rising to 45.9 million vehicles, with the number of pass-holders up 7% to more than 23,400. At national level, an agreement was reached with Barcelona City Council to adopt a new payment system, closer to the real stay, consisting in billing by 5 minute intervals after the first half hour. An investment plan to modernise the control, safety and environmental systems was also agreed on, as well as work to facilitate access for people with limited mobility. In compensation, the concession period for some car parks was extended. 036 3. Structure and Activity - 3.3. Activity for the year Location of saba car parks Lisbon Seville Rabat Andorra 1 Madrid Barcelona Rome 1 Location of car parks in Catalonia Barcelona Badalona Blanes Cadaqués Cambrils Cerdanyola Cornellà Figueres Girona Igualada Mataró Platja d’Aro Puigcerdà Sabadell Salou St. Joan Despí Sta. Perpètua de Mogoda Terrassa Vic Vilafranca del Penedès Vilanova i la Geltrú Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 037 Santiago de Chile Concepción During the year, four car parks were inaugurated in Spain with a total of 1,140 parking spaces and 112 new parking spaces were awarded. Internationally, the search for new opportunities has focused on the Latin American market, with the establishment of operations in Chile through the incorporation of Saba Chile, and the acquisition of 6 car parks located in Santiago de Chile and Concepción, with a total of 2,464 parking spaces. With respect to the consolidation of the Italian and Portuguese projects, the results of both subsidiaries (Saba Italia and Spel) have shown a significant improvement over the previous year. In the case of Italy, 367 new spaces have been opened and it is planned, in the short-term, to continue with the policy of investing in those projects that have been awarded to the company, together with the consolidation of recently-opened operations. In Portugal, Spel has seen very significant increases in the indices of its activity during 2004. In January 2005, saba acquired from Autostrade 40% of Saba Italia, giving it 100% control over its Italian subsidiary. Figures The car parks sector represents a total of 6% of operating income, 96 million euros, up 4.4% on the previous year. The contribution to consolidated EBITDA was 38 million euros, a rise of 13.5% on the previous year. 038 3. Structure and Activity - 3.3. Activity for the year Logistic services The logistic services business unit is channelled through abertis logística, holding company for the Group’s interests in this sector of activity. This business unit is made up of a combination of projects at different phases of development in Barcelona, Álava and Seville. Logistic infrastructures 1 Álava Barcelona 2 1 2 3 Álava Arasur 210 hectares Barcelona 7 hectares CIM Vallès 38 hectares PLZF CILSA (ZAL I + ZAL II) 220 hectares Seville Sevisur 25 hectares Seville 3 Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 039 Key data for logistic services companies Company City % holding abertis logística/CIM Vallés Barcelona 100.0% Sevisur Sevilla Parc Logístic Zona Franca Barcelona Arasur Cilsa Álava Barcelona 60.0% 50.0% 39.7% 32.0% Total area (m2) 70,000 250,000 375,000 2,100,000 2,270,000 Current state Operative Construction Operative Construction Operative Areamed 2000 Barcelona 50.0% — Operative Activity abertis logística continues operating the integrated goods area of the Central Integral de Mercaderías (CIM) del Vallès, which increased its income by 20% in 2004 due to the positive evolution of the activity in the majority of services offered (truck parking, service station, hotel, food services, commercial area and mechanical repairs) and increased occupation in the leased offices building. The Parc Logístic de la Zona Franca, a company held equally by the Consorcio de la Zona Franca de Barcelona (50%) and abertis logística, continued to have 100% occupation during 2004 in more than 100,000 m2 of warehouses and 20,000 m2 of leased offices. CILSA, Centro Intermodal de Logística, S.A., in which abertis logística holds 32% and the Barcelona Port Authority holds 51%, is developing a logistics space of more than 200 hectares in two phases, Zal Barcelona and Zal Prat, in the port zone of Barcelona. hectare area (ZAL Seville) for logistics warehouses to be leased and 10 hectares for the provision of services, under a 30 year concession. During 2004 Phase I was built with 32.000 m2 of warehousing of which almost 40% being leased. In February 2003 Arasur Logística S.A. was incorporated, with abertis logística holding 39.7%, acting as industrial, technological and management partner, with the remaining shares held by the Caja Vital, the Diputación Foral de Álava and the Autonomous Government of the Basque Country. Arasur will construct and operate an inter-modal logistic platform, which it will own, in an area of more than 200 hectares in the south of Álava province. During 2004 levelling work has commenced for the first phase. Areamed, manages the service areas of the acesa highways network. In 2004 the positive evolution of its activity has continued and development of the 2004/2006 Investment Plan has begun to redesign the service areas it manages and controls. During 2004, with Zal Barcelona already completed and fully occupied, Cilsa has continued with work on the development of Zal Prat. Figures Sevisur Logística S.A., owned by abertis logística (60%), and by a series of Andalusian savings banks and the Seville Port Authority, is developing a 25 The logistic services business unit recorded operating income of 16 million euros and contributed EBITDA of 4 million euros to the consolidated accounts of abertis. Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 041 Telecommunication infrastructures abertis telecom is the parent company of the telecommunication infrastructures business. As well as holding the shareholdings of abertis in this sector, it provides technical assistance and operates the fibre optic cabling located along the acesa highways network. Through the course of the year the organisation structure of abertis telecom has been developed, aimed at facilitating the operational development of the businesses, creating new services and products to promote its expansion into new markets, maintaining the networks of retevisión and tradia legally and operationally separate. Key data for the telecommunication infrastructure companies Company % holding No. of sites abertis telecom tradia retevisión Torre de Collserola 100.0% 100.0% 100.0% 41.8% — 679 2,524 — abertis telecom is betting on the digital future of the audiovisual sector, actively supporting and participating in the development of digital TV and radio in Spain, and participating in the most relevant national and European events of the sector with the main objective of promoting the launch of DTT in Spain. The Meeting of Ministers on 30th December 2004 agreed to modify the National Technical Plan for Digital Television before summer 2005, to assign the available frequencies as soon as possible for new programmes (freed up following the disappearance of Quiero TV), to start broadcasting new programmes with national coverage in autumn 2005 and to bring forward by two years the end of the period for transition to Digital Terrestrial Television (from 2012 to 2010). tradia is one of the leading Spanish companies specialised in leasing telecommunication infrastructures to operators of mobile telephones, radio transmitters (in Catalonia) and closed user groups. During the year, tradia was awarded various contracts on tender, such as the projects in Murcia and Jerez to develop mobile radio-communication networks for emergency services, or the award of the contract to broadcast signals of the autonomous radio and television in the Balearic Islands. The results for the year show the impact of the significant investments that the company has been making and the positive evolution of the main activities. retevisión offers services of transporting and broadcasting television and radio signals at a national level on analogical and digital networks. It has a network with 2,500 telecommunication sites, including the emblematic Torrespaña in Madrid and Torre de Collserola in Barcelona. During the year, retevisión increased its shareholding in Torre de Collserola to 41.7%, making it the main core shareholder. 042 3. Structure and Activity - 3.3. Activity for the year tradia and retevisión sites Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 043 Figures The telecommunications business has seen a positive evolution in the activity, with both tradia and retevisión registering positive EBITDA and net profits. abertis has provisioned 100% of its investment in Xfera (holder of a UMTS mobile telephone licence) as the commercial and technical roll-out is on hold, awaiting the availability of UMTS technology. The business of telecommunication infrastructures is the second largest sector in terms of contribution to income, at 266 million euros (17%) and EBITDA, 88 million euros (9%), in abertis. 044 3. Structure and Activity - 3.3. Activity for the year Airports managed by abertis Stockholm Skavsta Belfast International Cardiff International London Luton Toronto Albany Burbank Atlanta Orlando Stanford Miami San José Colombia - Santafé de Bogotá Airports in Bolivia - El Alto (La Paz) - Viru Viru (Santa Cruz) - Jorge Wilstermann (Cochabamba) - TBI airports - CODAD airport Annual Report 2004 3. Structure and Activity - 3.3. Activity for the year 045 Airports abertis has an 85% shareholding in Codad, the company holding the concession for the construction and management of the second runway of the Bogotá airport and the management of the first runway, which was already built. Codad operates under a contract with guaranteed minimum income. Consequently, although the number of flights has declined by 1%, operating income in Columbian pesos has been steady, enabling a 2% rise in EBITDA. The contribution of income and EBITDA to the consolidated accounts of abertis was 21 and 18 million euros, respectively. In December 2004, ACDL, consortium between abertis (90%) and Aena Internacional (10%), presented a full public takeover offer for all the shares of the British airport operator, TBI. At 31 December 2004 it had acquired 29.2%. On 4 January 2005 ACDL completed the public takeover offer, gaining 100% control of TBI. TBI is a British airport operator that manages, under concession and ownership, eight international airports: three in United Kingdom (Luton, Cardiff and Belfast International), one in Sweden (Skavsta), one in United States (Orlando Stanford) and three in Bolivia (El Alto, Jorge Wilstermann and Viru Viru). Additionally, it fully or partially manages six airports in the United States, Canada and Costa Rica. At the end of 2004, only the 29% shareholding that had been purchased was included in the accounts (without effect on the profit and loss account given that the transaction occurred at year end). The incorporation of the TBI figures in the consolidated accounts of abertis will modify the relative weight of the sector contribution to income, and income from the airport sector could end up representing more than 15%. 046 3. Structure and Activity - 3.4. Economic performance for the year 3.4. Economic performance for the year Consolidated figures for abertis Balance sheet (million euros) ASSETS Consolidated LIABILITIES Consolidated Net fixed assets 8,360 7,684 Equity 2004 2003 Intangible fixed assets Tangible fixed assets Investments 625 6,663 1,072 262 6,622 800 Consolidation goodwill fund Deferred expenses Current assets 629 612 339 909 632 460 Share capital Share premium Reserves Result Interim dividend 2004 2003 3,318 3,107 1,654 580 743 467 (126) 1,576 580 716 355 (120) Minority interests Negative consolidation difference Deferred income 46 39 88 28 41 96 Provisions for liabilities and expenses 2,451 2,285 Total assets 9,940 9,685 Total liabilities Long-term creditors Short-term creditors 2,960 2,640 1,038 1,488 9,940 9,685 Total consolidated assets exceed 9,900 million euros. As is the case in infrastructure management businesses, fixed assets, consisting basically of investments in highways and other concessionaire assets, represent 67% of the total. Due to the merger between abertis and iberpistas in 2004 consolidation goodwill of 365 million euros has been transferred to intangible fixed assets. The investments reflect both the inclusion of 29.2% of TBI at the close of 2004 (which has also required the inclusion of 98 million euros in the goodwill fund), and the increase in the value of shareholdings consolidated by equity accounting during the year (proportional part of the result due to abertis), which has resulted in an increase of 22%. 87% of the deferred expenses relate to the financing charge under the current accounting standards for the sector of highway concessionaire companies. On the liabilities side, equity now exceeds 3,300 million euros thanks to the contribution of undistributed results (33% of total liabilities) and debt of just over 3,500 million, with a debt to equity ratio of 106%. Annual Report 2004 3. Structure and Activity - 3.4. Economic performance for the year 047 During 2004 efforts to optimise the financial structure of the Group have continued, with the transfer of short-term debt to long-term debt being of note, enabled, to a large extent, by the private placement of long-term bonds made by abertis in the North American market valued at 600 million dollars and the 450 million euros bond issue to institutional investors (also made by abertis) in the international market. The provisions for liabilities and expenses entry includes the reversion fund and represents 25% of total liabilities. This financial balance enables abertis to face both its selective policy of investment for growth, and the investments in improving managed infrastructures and its policy of return to shareholders with guarantees. Profit and loss account (million euros) Operating income Operating expenses EBITDA – Result Depreciation and reversion fund Operating profit Financial result Profit from associated companies Amortisation goodwill/negative consolidation differences Profit from ordinary activities Extraordinary profit (loss) Corporation tax Minority interests Profit for the year Consolidated 2004 1,534 (491) 1,043 (300) 743 (153) 116 (19) 687 (9) 2003 1,282 (367) 915 (220) 695 (151) 30 (36) 538 4 (211) (187) 0 467 0 355 The consolidated profit and loss account for 2004 is not comparable to the previous year due to the inclusion of retevisión in December 2003. As a result, the gross operating margin (EBITDA) and operating profit rose 14% and 7% respectively on the previous year. The consolidated operating income and expenses have increased due to the inclusion of retevisión as noted and the positive performance of the other companies of the Group. The slight change in the financial result reflects two concepts, however: the inclusion in 2004 of the cost of debt, both from retevisión itself and that raised by abertis for its acquisition, which practically 048 3. Structure and Activity - 3.4. Economic performance for the year compensate the allocations made in 2003 to write down the shareholding in Xfera. The profit of companies consolidated by equity accounting has increased significantly for the non-recurring contribution of 70 million euros from the shareholdings in Italian highways, due to the capital gains made on the sale by Schemaventotto of 10% in Autostrade and the sale by Autostrade of 5% in abertis. The amortisation of goodwill has been reduced by the transfer of the goodwill fund of Iberpistas to intangible fixed assets following the merger with abertis, which explains part of the increase in allocations for depreciation of fixed assets. As a result of all these changes, the profit from ordinary activities rose 28% and net profit for the year was 467 million euros, with an increase of 32% (12% if we exclude the impact of the extraordinary capital gains from the shareholdings in Italy). Figures for the parent company Abertis Infraestructuras Balance sheet (million euros) ASSETS Parent Co. LIABILITIES Parent Co. Net fixed assets 5,584 4,778 Equity 2004 2003 Intangible fixed assets Tangible fixed assets Investments 349 14 5,221 6 15 4,757 Share capital Share premium Reserves Profit Interim dividend 2004 2003 3,187 3,069 1,654 580 718 361 (126) 1,576 580 704 329 (120) Deferred expenses Current assets 7 9 415 588 Provisions for liabilities and expenses 41 41 Total assets 6,006 5,375 Total liabilities Long-term creditors Short-term creditors 2,158 1,369 620 896 6,006 5,375 The merger with iberpistas that took place during the year has caused part of the increase in the balance sheet figures. total, and on the liabilities side, which reflects the financing of these shareholdings through a combination of equity (53%) and debt (44%). The position as parent company of the Group is reflected on the assets side, where investments (portfolio of shareholdings) represents 87% of the During 2004 the financial structure has continued to be optimised, centralising the debt in abertis, which is responsible for covering the financing Annual Report 2004 3. Structure and Activity - 3.4. Economic performance for the year 049 requirements of the subsidiary companies. In addition, there has been a transfer of short-term debt to long-term debt, enabled, to a large extent, by the private placement of long-term bonds in the North American market valued at 600 million dollars and the bond issue to institutional investors in the international market of 450 million euros. Continuing with the established policy on shareholder return, the profit for the year of 361 million euros allowed an interim dividend of 126 million euros to be paid, which is to be complemented by the payment of a final dividend for 2004 of the proposed sum of 138 million euros. Profit and loss account (million euros) Operating income Operating expenses EBITDA – Result Amortisation and reversion fund Operating profit (loss) Financial result Profit from ordinary activities Extraordinary profit (loss) Corporation tax Profit for the year Parent Co. 2004 2003 15 (29) (14) (20) (34) 417 383 (42) 20 361 18 (29) (11) (3) (14) 332 318 (8) 19 329 As parent company of the combined share holdings, the profit and loss account is primarily concentrated in the financial result, which shows the dividends received from subsidiary and associated companies as well as the financial expenses related to the structure of its liabilities. Operating income and expenses correspond to the expenses of the Corporation that are partially charged out to the subsidiary companies. The allocations for amortisation have increased significantly due to the amortisation of goodwill fund assumed through the merger with iberpistas that took place during the year. The financial result rose to 417 million euros due to the impact of larger dividends received which have offset the increase in financing charges arising, primarily, from the acquisition of retevisión at the end of 2003. The extraordinary loss includes corrections in the valuation of the portfolio of shareholdings arising from the standardisation of accounting criteria. Net profit increased almost 10% to reach 361 million euros. 4 abertis on the Stock Exchange 4.1. Stock market conditions 4.2. abertis shares 4.3. Evolution of share capital - Share issues 4.4. Dividend and shareholder yield 4.5. Shareholders 4.6. Significant shareholdings 4.7. Market information 052 4. abertis on the Stock Exchange 4.1. Stock market conditions 2004 has been the second consecutive year of recovery for the main world stock markets, with an outstanding Spanish stock market performance following a 17.4% rise in the Ibex-35, higher than all the other European indices and ahead of the main United States indicators. Factors of uncertainty include the significant increase in the price of oil since summer 2004, which has had a negative impact on world economic expectations and the revaluation of the euro against the US dollar. However, the appearance of these alterations has not affected the good rate of overall growth this year in many countries. The Spanish economy experienced a slight acceleration in the growth rate in 2004 to 2.7%, up 0.2% on the previous year, and 1% ahead of the euro-zone, following an acceleration in internal demand supported by private consumption and investment in capital goods. The Spanish stock market registered its second consecutive year of gains, albeit somewhat more moderate on this occasion and concentrated in the last part of the year. The year began with the same upward trend maintained since March 2003, but the uncertainty generated by the terrorist attack of March 11th, together with the usual market weakness experienced with changes in government, broke this trend. The Spanish stock market recorded a fall of almost 10%, from 8,400 points on the Ibex index to 7,700 points. Midway through August the low for the year was recorded, but the rise in company profits, the recovery of the world economy, the absence of inflation in spite of the rise in oil prices and the holding of elections in the United States without incidents, acted as a boost to stock markets in the last quarter of the year. The positive balance of the Ibex in 2004, together with the rise in the previous year, resulted in a 50.4% revaluation of the Ibex-35 over the last twenty-four months, rising to 9,100 points at the end of 2004, its maximum level since June 2001. This performance, along with the limited volatility during the year, indicates a progressive improvement of investor confidence in equities. This confidence has been illustrated by the significant rise in trading volumes on the Spanish Stock Exchange, with a 28.8% increase on the previous year’s figures, which represents a record volume for the Spanish exchange. Market capitalisation has also increased significantly, rising to almost 650,000 million euros, especially due to the improvement in share prices and the incorporation of new shares through public share offers and new share issues. 4.2. abertis shares The evolution of the abertis share this year has continued to be excellent, being the best of the main European highway companies that it is usually compared with. The revaluation over the last twelve months was 41.9%, once again easily exceeding the rise in the Ibex-35. The share price began the year on an upward trend, interrupted by the terrorist attacks of March 11th, which caused a fall of approximately 4%. The recovery from this fall was quick, with the price rising to 14.50 euros by mid April, representing a 14% rise from the low in March. At the end of July the usual bonus share issue was made and the share price recovered within a few days of the adjustment corresponding to this share issue. Annual Report 2004 4. abertis on the Stock Exchange 053 The upward trend continued during the rest of the year, with the price rising significantly in September along with that of the rest of the market, to exceed 15 euros. Following notification in November of the Public Takeover Offer for the airport operator TBI made by abertis in partnership with Aena Internacional, the share price rose to 16 euros, ending the year at €16.20. 18.00 16.00 14.00 12.00 10.00 8.00 6.00 Accumulated increase: +114% abertis acesa 2000 +13% 2001 +26% 2002 -1.3% 2003 +16.6% 2004 +41.9% The Company is amongst the best companies in the Ibex in terms of return, considering the increase in the share price and the dividend yield, and it is among the four companies of the Ibex with the lowest volatility. Ordinary Class A abertis shares - 2004 Close (euros) 16.5 5,889 23,751 27,986 Volume (thousand shares) 5,000 5,882 16 15.5 15 14.5 14 13.5 13 12.5 12 11.5 11 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 J F M A M J J A S O N D Price adjusted for capital issue Unadjusted price Volume abertis is one of three companies out of the Ibex-35 that have shown a positive annual performance over the last five years. The 41.9% rise, added to the increases of the four previous years, gives an accumulated increase in the last five years of 114%. The increased share price saw the market capitalisation of abertis reach 8,897 million euros at the end of the year, with 8,334 million corresponding to Class A shares and 563 million to Class B shares. The Ibex rose 17.4%, although it remains below its closing level for 1999 (change over last five years: -22%). As far as the stock market evolution of the Class B preference shares is concerned, the shares have shown little liquidity and rarely been traded since being listed on 29 July 2002. This is explained by the fact that the shares give the right to a preference dividend based on how long they have been held and the price of the ordinary Class A shares, which makes trading in these shares less attractive. Due to the limited trading, on 2 January 2004 the Stock Exchange Company decided to change trading of the 37,036,366 class B shares to the price fixing mode, whereby they are traded in two sessions daily (by auction). Comparison of the evolution of abertis and the main indices (Base 31/12/99=100) 220 1999 abertis A Adjusted close: €7.56 5-year evolution (2000-2004) Change in last 5 years: abertis A: +114% abertis B: +28% Ibex 35: -22% Eurotop 300: -34% 2004 abertis A Close: €16.20 200 180 160 140 120 100 80 60 40 30/12 1999 30/12 2000 30/12 2001 30/12 2002 abertis A(*) abertis B(*) Ibex 35 30/12 2003 30/12 2004 Eurotop 300 (*) Adjusted for share issues 054 4. abertis on the Stock Exchange The shares of the company are listed on the Barcelona, Bilbao, Madrid and Valencia Stock Exchanges and are traded on the electronic interconnected market. The ordinary Class A shares have formed part of the Ibex 35 index since 1992 and are also included in other well known international indices such as Standard & Poor’s Europe 350 and the FTSE Eurofirst 300. In September 2004 abertis was included in the Dow Jones Sustainability World index (DJSW), and for a second consecutive year, in the Dow Jones Sustainability Index Stoxx for European companies, increasing its presence in the sustainability indices. Furthermore in December, FTSE Group, the company responsible for the Footsie stock market indices, announced the creation of the FTSE ISS Corporate Governance indices, a series of indices that value good governance of companies. abertis is one of only thirteen Spanish companies included in these indices. 4.3. Evolution of share capital - Share issues At the end of 2004 the share capital of abertis totalled 1,654 million euros, made up of 551,481,375 bearer shares with a nominal value of 3 euros each, fully subscribed and paid up, of which 514,445,009 are ordinary Class A shares and 37,036,366 are Class B preference shares. During 2004 the usual bonus share issue was made. July - August The Shareholders’ Meeting held on 27 April agreed to increase share capital with a charge against reserves for an amount of 79 million euros, by issuing and circulating 26,261,017 ordinary Class A shares, for all shareholders, whether Class A or Class B, with 1 new share for every 20 shares held. Between 20 July and 3 August 49.2 million rights were traded, with a maximum price of 0.99 euros and a minimum price of 0.68 euros. The theoretical value of the rights was 0.69 euros. The new shares were admitted for trading on 11 August, having the same voting and dividend rights as the existing shares of their class, giving the bearer dividend rights from 1 January 2004. 4.4. Dividend and shareholder yield Since 1993, abertis has based its policy of shareholder return on a constant annual dividend, in two payments, which is increased through the annual bonus share issue. abertis paid a final dividend for 2003 of 0.223 euros per share in May, and an interim dividend for 2004 of a gross amount of 0.229 euros per share in October. The Board of Directors of abertis has agreed to recommend an increase in the final dividend at the 2005 Shareholders’ Meeting, proposing a payment of 0.25 euros gross per share to be paid in the second half of April 2005. This proposal represents a 12% increase in the final dividend. This amount, added to the interim dividend paid in October, represents a total dividend per share of 0.479 euros gross per share charged against profit for 2004, 6% more than in 2003, with the total dividend amount increasing by 11% given the greater number of shares due to the bonus shares issued. The total amount allocated by abertis to dividends for 2004 was 264.2 million euros. Annual Report 2004 4. abertis on the Stock Exchange 055 Evolution dividend Evolution dividend (million euros) (in euros) 0.5 +6 Dividend total: +11% +5%: Due to increased number of shares after share issue. +6%: Due to 12% increase in final dividend. 0.4 0.3 0.2 0.1 0 (*) Proposal to 2005 Shareholder’ Meeting +12 Interim Final 2003 2004 0.229 0.229 0.223 0.25(*) Total dividend (million euros) 0.452 0.479 264.2 237.4 2003 2004 300 250 200 150 100 50 0 Total dividend (million euros) 4.5. Shareholders The Investor Relations / Shareholders' Office area runs the communication program to financial markets for abertis, releasing all significant information about the Company for shareholders and answering all the queries and doubts that the shareholders and investors raise regarding the evolution of the Company in all its areas. abertis provides shareholders and the investment community at large with different channels to contact the Company: • Company website, www.abertis.com Permanent communication channel that has a complete section of information that may be of interest to shareholders and investors. This was the most visited section of the abertis website in 2004. • abertis Magazine Corporate publication with recent news about abertis, providing a more detailed reflection compared to the urgent nature of news covered by the media. It contains a specific section for shareholders and investors with contents related to financial matters and the share markets, which has become a strong link with the investment community. • E-mail, relaciones.inversores@abertis.com Postal address: Avenida del Parc Logístic, 12-20, 08040 Barcelona Direct channels with the Company enable an open dialogue with shareholders, so they can raise specific doubts and the Company can provide all the information or clarifications required. • Shareholder Telephone Service (902 30 10 15) 24 hour service, 365 days a year to respond to any doubts or suggestions of shareholders. The queries tend to be especially about matters related to share issues, the Annual Shareholders’ Meeting and dividends. Breakdown of telephone queries received at Shareholder Telephone Service (figures as percentage) 32% Share issues 23% Others* 29% Shareholders’ Meeting 16% Dividends * Questions about results, evolution, share price, relevant events, new investments, requests for documentation, etc. 4.6. Significant shareholdings The significant shareholdings in the Company’s share capital are those set out in the Corporate Governance Report which is included as an annex to this Annual Report. 056 4. abertis on the Stock Exchange 4.7. Market information Information for 2004: Trading frequency Trading days Traded volume adjusted for share issues (No. shares) Equivalent percentage of total adjusted shares Cash value traded (million €) Market capitalisation (at 30/12) (million €) Options on abertis shares Evolution over the last four years: Class A shares Class B shares 2004 100% 251 2003 100% 250 2004 60% 150 2003 39% 98 318,900,812 268.202.536 372,503 144,130 62% 4,210.55 8,334.01 37,140 55% 3,045.48 5,853.33 43,731 1.0% 5.45 0.4% 1.76 562.95 442.58 n.a n.a Ibex 35 Close Annual change High/Low Ibex Utilities Close Annual change High/Low Eurofirst 300 Close Annual change High/Low Class A Shares Close/Adjusted close(1) Annual change/ Adjusted annual change(1) High/Low High/Low (adjusted)(1) Weight in Ibex 35 Class B shares Close/Adjusted close(1) Annual change/ Adjusted annual change(1) (2) High/Low High/Low (adjusted)(1) 2004 2003 2002 2001 9,080.8 17.4% 9,100.7 7,578.3 7,737.2 28.2% 7,760.4 5,452.4 6,036.9 -28.1% 8,554.7 5,364.5 8,397.6 -7.8% 10,132.0 6,498.4 18,183.4 20.6% 15,073.0 31.9% 11,429.2 -32.9% 17,033.5 -5.5% 18,251.3 15,158.5 15,217.0 10,992.8 17,348.0 10,311.6 20,880.3 13,459.7 1,041.8 8.8% 1,042.2 940.9 957.9 11.8% 957.9 857.0 -32.2% 1,279.7 682.7 1,264.9 -17.5% 1,545.5 998.9 797.2 16.20 16.20 11.99 11.42 10.80 9.80 11.19 9.67 35.1% 41.9% 12.03 16.26 16.26 11.46 2.42 11.0% 16.6% 10.80 12.90 11.70 9.80 2.14 -3.5% 11.99 10.36 1.55 1.3% 10.28 8.88 20.2% 20.2% 9.26 11.89 9.78 8.00 1.12 15.20 15.20 11.95 11.37 12.19 11.10 27.2% 33.7% 11.97 15.42 11.38 15.42 -2.0% 14.00 12.75 2.4% -10.7% -5.7% 11.77 13.65 11.05 10.23 11.87 10.06 Note: high and low at close. (1) Adjustment for bonus share issues (2) In 2002, the annual change for Class B shares is calculated using the closing price on the first day of admission (29/07/02). 5 Financial Information 5.1. Consolidated Annual Accounts Consolidated Management Report Consolidated Auditor’s Report 5.2. Parent Company Annual Accounts Parent Company Management Report Parent Company Auditor’s Report 058 5. Financial information - 5.1. Consolidated Annual Accounts Consolidated balance sheet at 31 December (thousand euros) ASSETS Fixed assets Start-up costs Intangible fixed assets Research and development expenses Computer applications Administrative concessions Goodwill Studies and projects Other intangible assets Amortisation Tangible fixed assets Highway investments Land and natural resources Buildings and other constructions Machinery and vehicles Installations, tooling and furniture Other fixed assets Other fixed assets under construction Depreciation Investments Investments in companies consolidated by equity accounting Loans to companies consolidated by equity accounting Long-term share portfolio Long-term deposits and guarantees Other credits Provisions Consolidation goodwill Deferred expenses Current assets Inventories Accounts receivable Advance payments to creditors Clients Debtors from companies consolidated by equity accounting Debtors - Public Treasury compensation Sundry debtors Personnel Public Administration Provisions Short-term investments Short-term share portfolio Loans to companies consolidated by equity accounting Interest receivable Other credits Treasury Cash Banks and credit institutions Prepayments and accrued income Total assets 2004 2003 8,360,399 5,411 619,863 7,953 36,412 94,725 572,390 541 18,745 (110,903) 6,663,284 6,139,908 13,677 389,752 217,722 685,052 42,855 62,371 (888,053) 1,071,841 843,597 16,015 52,038 2,557 199,946 (42,312) 628,357 612,256 339,010 5,393 280,160 255 115,307 3,281 119,667 27,107 635 21,689 (7,781) 27,988 14,682 11,615 978 713 23,537 5,311 18,226 1,932 7,684,184 7,654 254,193 6,495 34,140 54,960 209,775 1,101 18,965 (71,243) 6,622,253 6,085,044 13,676 385,273 212,882 659,574 39,284 46,907 (820,387) 800,084 593,123 — 48,642 4,497 188,195 (34,373) 908,943 631,848 459,684 7,096 278,148 230 108,976 — 95,827 48,013 518 33,499 (8,915) 141,060 14,547 — 177 126,336 26,293 3,029 23,264 7,087 9,940,022 9,684,659 Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 059 Consolidated balance sheet at 31 December (thousand euros) LIABILITIES Equity Share capital Share premium Reserves Revaluation reserve Legal reserve RD 1564/1989 Voluntary reserve Reserves in fully consolidated companies Reserves in companies under equity accounting Exchange differences Profits and losses due to parent company Consolidated profits Profits due to minority interests Interim dividend paid during year Minority interests Negative consolidation differences Deferred income Provisions for liabilities & expenses Reversion fund Other provisions Long-term creditors Bond issues Loans with credit entities Loans to companies under equity accounting Payment pending on shares in Group companies Other creditors Short-term creditors Bond issues Bonds Interest on bonds Loans with credit entities Loans Interest on loans Loans to companies under equity accounting Trade creditors Trade creditors Sundry creditors Other non-trade creditors Public Administration Accrued payroll expense Other debts Deposits and guarantees held Accrued expenses 2004 2003 3,317,694 1,654,444 579,690 945,338 400,712 191,570 353,056 (52,356) 16,034 (166,458) 467,291 467,031 260 (126,289) 46,187 39,415 88,484 2,450,579 2,382,665 67,914 2,959,842 1,395,858 1,420,550 10,855 3,274 129,305 1,037,821 203,243 178,050 25,193 500,812 492,998 7,814 17,891 167,932 125,227 42,705 144,924 98,442 14,946 24,288 7,248 3,019 3,107,354 1,575,661 579,690 896,422 479,495 158,668 258,259 (24,356) 10,200 (165,194) 355,206 355,369 (163) (120,275) 27,844 40,889 95,573 2,285,414 2,213,112 72,302 2,639,501 656,428 1,846,714 — 3,353 133,006 1,488,084 12,568 7,175 5,393 1,118,216 1,107,459 10,757 — 182,258 118,410 63,848 172,730 95,229 12,206 59,001 6,294 2,312 Total liabilities 9,940,022 9,684,659 060 5. Financial information - 5.1. Consolidated Annual Accounts Consolidated profit and loss account for year ended 31 December (thousand euros) EXPENSES Personnel expenses Salaries and wages Social security Pension fund and other personnel-related liabilities Amortisation and depreciation of fixed assets Movement in trading provisions Other operating expenses External services Taxes Charge to reversion fund Total operating expenses Operating profits Financial costs and related expenses Total financial expenses Amortisation of consolidation goodwill Profit on ordinary activities Losses on disposal of fixed assets and extraordinary expenses Extraordinary profits Consolidated profits before taxes Corporate Income Tax Consolidated profit for the year Due to minority interests 2004 2003 239,784 176,174 190,813 45,035 3,936 159,534 2,281 141,860 33,023 1,291 86,098 2,369 389,862 323,260 235,292 13,856 140,714 177,316 13,326 132,618 791,461 587,901 742,548 695,248 159,831 159,137 159,831 159,137 19,830 36,795 686,985 537,808 26,143 — 20,006 4,028 678,257 541,836 211,226 186,467 467,031 355,369 (260) 163 Profit due to parent company 467,291 355,206 Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 061 INCOME Operating revenue Toll income Discounts and rebates on toll income Provision of services Work done by the company on fixed assets Other operating income Sundry income and other management income Total operating income Other interest and related income Total financial income Negative financial results 2004 2003 1,489,140 1,226,299 1,136,285 (35,757) 388,612 1,075,176 (32,669) 183,792 4,302 40,567 40,567 1,346 55,504 55,504 1,534,009 1,283,149 7,280 7,688 7,280 7,688 152,551 151,449 Share in profit and loss of companies consolidated by equity accounting 115,856 29,904 Reversion of negative consolidation differences 962 900 Profits from the disposal of fixed assets and extraordinary income 17,415 24,034 Extraordinary loss 8,728 — 062 5. Financial information - 5.1. Consolidated Annual Accounts ABERTIS INFRAESTRUCTURAS, S.A. NOTES TO THE CONSOLIDATED ANNUAL ACCOUNTS OF 2004 Note 1. Activity a) Activity ABERTIS INFRAESTRUCTURAS, S.A. (hereinafter abertis or the Company) was incorporated in Barcelona on 24 February 1967. The registered office of the company is Avenida del Parc Logistic nº 12-20, Barcelona. On 8 April 2003, the Extraordinary General Shareholders’ Meetings of ACESA Infraestructuras, S.A. and AUREA, Concesiones de Infraestructuras, S.A. (AUREA) approved the merger, where the former company was to take over the latter company, effective for accounting purposes as from 1 January 2003, the date from which it is understood that AUREA operations were conducted on account of the Company. On 30 May 2003 (date of registering the merger deed with AUREA) the company changed its name from ACESA INFRAESTRUCTURAS, S.A. to its current name. abertis is the parent company of a group engaged in the management of infrastructures serving mobility and communications operating in five sectors of activity: highway concessions, car parks, logistic services, telecommunications and airports. Its business is the construction, maintenance and operation of highways under concession; the management of highway concessions in Spain and internationally; the construction of roads; complementary construction activities, maintenance and operation of highways, such as service stations, integrated logistics and/or transport centres and/or car parks, as well as any other activity related with transport infrastructures and communication and/or telecommunications serving mobility and the transport of people, goods and information, with the necessary authorisation, should it be required. The Company can undertake its business, especially the concessionary activity, directly or indirectly through its shareholding in other companies, being subject, in this respect, to the legal provisions in force at any time. b) Merger On 27 April 2004 and 26 April 2004, the General Shareholders’ Meetings of Abertis Infraestructuras, S.A. and Ibérica de Autopistas, S.A. respectively approved the merger of both companies, whereby the former company took over the latter, effective from 1 January 2004 for accounting purposes. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 063 As the shareholding of abertis in the capital of Ibérica de Autopistas, S.A. was 99.84%, it was not considered necessary to make a specific capital increase to cover the exchange of shares in Ibérica de Autopistas, S.A. for shares in abertis. To acquire the 0.16% of shares outstanding, abertis purchased the necessary treasury stock to swap with the shareholders of Ibérica de Autopistas, S.A. at the established rate of 1 share in Ibérica de Autopistas, S.A. for 1 share of abertis. Note 2. Basis of presentation and consolidation The Consolidated Annual Accounts represent the consolidation of the parent company, abertis, and the subsidiary and associated companies detailed in the Annex. a) True and fair view The Consolidated Annual Accounts have been prepared by the administrators of abertis with the objective of providing a true and fair view of its equity, the financial situation and the consolidated profit and loss account for the year ended 31 December 2004, based on the accounting records, both of abertis and its subsidiary companies, in accordance with the Rules for the Preparation of Consolidated Annual Accounts approved by Royal Decree 1815/91, dated 20 December 1991, and following the General Accounting Plan for highways, tunnels and other toll routes applicable to highway concessionary companies. All the companies in the consolidated Group work to a financial year end at 31 December, except the TBI group (31 March) for which the balance sheet at 31 December 2004 has been prepared. The necessary adjustments and reclassifications have been made to standardise accounting policies in those cases where there are significant differences with respect to the parent company to obtain a true and fair representation of the Group; the companies consolidated by equity accounting have been standardised, provided the necessary information was available. All the balances and significant transactions between consolidated companies have been eliminated in the consolidation process. The figures provided in the notes to this Annual Report and in the consolidated balance sheet and consolidated profit and loss account are expressed in thousand euros. b) Comparison of information The Annual Accounts for 2004 are not directly comparable with those for 2003 as retevisión has been fully consolidated in 2004 for the entire year, whereas in 2003 it was included in the accounts on 31 December (without impact on the profit and loss account for that year). 064 5. Financial information - 5.1. Consolidated Annual Accounts c) Accounting principles of consolidation The consolidation methods applied to obtain the consolidated annual accounts are as follows: • Full consolidation: Used for those companies where abertis holds a majority position of more than 50% of the share capital or voting rights, or if they are fully consolidated in the subgroup that they belong to, or if abertis maintains control over management and administration, and which represent a significant interest with respect to presenting a true and fair view of the consolidated accounts. The value of the minority interest in the equity and profit and loss account of fully consolidated subsidiary companies is included under “Minority interests” under the liabilities in the consolidated balance sheet, and “Profits attributed to minority interests” in the consolidated profit and loss account, respectively. • Proportional consolidation: Used for those companies where there is joint management (multi-group companies). • Consolidated by equity accounting: Used for those companies in which the direct or indirect shareholding is greater than 20% (3% if publicly listed) and less than 50% of the share capital; those companies where the holding is less than 20% but there is a significant influence in the management; and those companies where the holding is 50% or more, but the interest is not significant with respect to presenting a true and fair view of the consolidated accounts. d) Variations in the consolidation perimeter The most significant variations in the consolidation perimeter and the companies that make up the consolidated group during 2004 were as follows: • Merger of abertis with Ibérica de Autopistas, S.A. effective for accounting purposes from 1 January 2004 (see Note 1.b). • Transfer from abertis to Iberpistas, S.A.C.E (old A-6) of the shareholdings in castellana, Iberavasa, Iberacesa, Ibermadrid and Proconex. • Sale by acesa to Iberpistas, S.A.C.E of 50% of Iberacesa, S.L., giving Iberpistas, S.A.C.E 100% control. • Incorporation of Ciralsa (consolidated by equity accounting) in which aumar holds 25%. • Transfer of 10% shareholding in Brisa held by acesa to the Portuguese company Acesa SGPS (100% owned by acesa). • Acesa SGPS became fully consolidated (previously consolidated by equity accounting). • Sale by Schemaventotto (in which Acesa Italia holds 12.83%) of 10% of Autostrade reducing its shareholding from 62.2% to 52.2%. • acesa, through its subsidiary Acesa Italia, increased its shareholding in Schemaventotto to 13.33% through the acquisition of the 0.5% shareholding held by the Portuguese operator Brisa. The final indirect shareholding of acesa in Autostrade increased to 6.95%. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 065 • • • Increase in shareholding of acesa in Autema from 22.33% to 23.72% following reduction of capital made to offset different percentage contributions of shareholders on the unpaid share capital. Incorporation of Airport Concessions Development Limited (ACDL), in which abertis holds 90% (fully consolidated). On 24 November 2004, ACDL made a Public Takeover Offer for all the shares of TBI, plc. At 31 December 2004, ACDL had directly acquired 29% of TBI (being consolidated by equity accounting, as a result) and in 2005 the public takeover has been completed taking control of 100% of the capital. Incorporation of Abertis Infraestructuras Finance BV, which is 100% owned by abertis (fully consolidated). • abertis logística increased its shareholding in Arasur from 39.5% to 39.77% after an increase in share capital was not subscribed by another shareholder. • • • • Increase of shareholding of retevisión (100% owned by abertis telecom) in Torre de Collserola to reach 41.75%. Incorporation of Saba Estacionamientos de Chile, S.A. 100% owned by saba and subsequent acquisition of 100% of the companies Subterra, S.A and Subterra Dos,S.A. The three companies are fully consolidated. Incorporation of Las Mercedes, Sociedad Concesionaria, S.A. in which saba holds 33.33% (consolidated by equity accounting). Incorporation of Port Mobility and Parcheggi Pisa in which Saba Italia holds 10% (consolidated by equity accounting) and 70% (fully consolidated), respectively. Note 3. Accounting policies The most significant accounting policies applied in the preparation of these Consolidated Annual Accounts are as follows: a) Consolidation goodwill Corresponds to the difference between cost and book value of parent company shareholdings in subsidiary companies on the date of first consolidation adjusted for the amount of latent capital gains on acquisition, when applicable. Goodwill is amortised systematically over a maximum period of twenty years, or, in the case of toll highways and other concessions, over the remaining life of the concession, given that this period is a better match for generating the required resources for recovery. 066 5. Financial information - 5.1. Consolidated Annual Accounts b) Negative differences on first consolidation In the case of shares whose purchase price at the time of acquisition was below the book value of the investment, this difference is treated as a negative difference on first consolidation, being applied over the useful life of the assets of the company where the difference arises. c) Conversion of financial statements in foreign currencies for foreign companies The financial statements prepared in foreign currencies corresponding to subsidiary companies in countries outside of the euro zone are converted to euros using the year-end exchange rate: • Capital and reserves are converted at historical exchange rates. • Entries in the profit and loss account are converted applying the average exchange rate for the period. • The other entries in the balance sheet have been converted at the year-end exchange rate. The differences arising from this conversion are shown separately in the movements of the distinct balance sheet items detailed in the notes to these annual accounts. After applying this procedure, exchange differences are shown in the accounts as “Exchange differences” under shareholders’ funds in the consolidated balance sheet, except in the case of GCO, due to the existing exchange rate hedge. The exchange rate differences resulting on conversion with respect to this company (having deducted the part corresponding to minority interests) are shown directly as an amount to be recovered under “Financial investments –Other credits” (47,031 thousand euros) as there is an exchange rate hedge (see Note 21 d). d) Start-up costs Corresponds to expenses incurred on incorporation, establishment and share capital increases, which are amortised using the straight line method over a maximum period of five years. e) Intangible fixed assets Intangible fixed assets are valued at acquisition price or their cost of production and amortised as follows: • Goodwill. Amortised on a straight line basis over a maximum period of 20 years, being the period over which the investment is expected to be recovered. • Administrative concessions. Correspond to the amounts paid to obtain the right to operate car parks and are amortised over the concession period. • Other amounts are amortised on a straight line basis over a maximum period of five years. Nevertheless, the balance pending amortisation will be taken to profit and loss in the event that the asset is found to be obsolete. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 067 f) Tangible fixed assets Tangible fixed assets are valued at acquisition cost, revalued in accordance with various legal measures. Personnel costs and other expenses, as well as financing costs directly imputable to highway investments, are capitalised as part of the investment until brought into use. Costs of refurbishment, enlargement or improving tangible fixed assets are capitalised only when they increase capacity, productivity or extend the useful life of the asset, provided that it is possible to know or estimate the net book value of the assets which are written off after being replaced. The costs of repairs and maintenance are charged to the profit and loss account in the year in which they are incurred. The depreciation of tangible fixed assets is calculated systematically using the straight line method, based on the estimated useful life of the assets, taking into consideration wear and tear derived from normal use. Of the combined investments represented by highway investments, most are depreciated through allocation to the reversion fund, where technically only the installations and other works of replacement are depreciated according to their estimated useful life. The depreciation rates used to calculate the decline in value of the fixed assets are as follows: Buildings and other constructions Machinery Tooling Other installations Furniture Computer equipment Other fixed assets Tollgate machinery Highway investments Rate 2-20% 6-30% 7-37.5% 7-20% 10-25% 20-37.5% 3.9-30% 5.6-20% 2-25% 068 5. Financial information - 5.1. Consolidated Annual Accounts g) Financial assets and investments Investments in companies consolidated by equity accounting are stated at book value as shown in their annual accounts at 31 December. Other financial investments are valued at acquisition price, or market price if the value has declined. h) Deferred expenses This entry includes: • • Financial expenses incurred by some companies of the Group in financing the investment in highways which, in accordance with the rules applicable to the sector, are recorded against profit and loss based on the proportion of total toll income per year projected in the companies’ financial plans. Leases paid in advance that are charged to the profit and loss account over the term of the respective contracts. • Expenses derived from hedging operations that are recorded monthly over the period that the operation is underway (see Note 21.d). • Expenses incurred in raising loans, which are amortised on a straight-line basis over the loan period. i) Inventories Inventories consist primarily of spare parts for fixed assets and are valued at cost, calculated using the average weighted price method, making the necessary valuation adjustments and setting up the corresponding provisions. j) Minority interests This account reflects the interest of minority shareholders in the net book value of fully consolidated companies at 31 December. The interests of the minority shareholders in results for the year of fully consolidated companies is shown as “Results attributed to Minority interests”. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 069 k) Reversion fund The reversion fund of the Group companies is generated annually, and throughout the concession period for assets subject to reversion, by means of regular charges to the profit and loss account until the fund totals the net book value of the assets to be reverted plus the estimated costs to be incurred in order to hand these over in suitable condition for use, as provided for under the terms of the concession agreement. In the case of the Spanish concessionaire companies, the allocation to the reversion fund is calculated on the basis of real toll income each year compared with the projected total in the respective Financial Plan until the end of the concession, in accordance with the terms of adaptation of the General Accounting Plan. l) Other provisions Pursuant to the prudence principle, the Group companies register the provisions which they consider necessary in relation to the inherent risks in the business which could affect them (see Note 15). m) Deferred income This entry includes: • Capital grants that are recorded when the requirements for their payment are met, being recognised in the profit and loss account when they are paid and allocated over the estimated useful life of the assets financed. • Compensation from the Administration for works by aumar that are recognised in the profit and loss account in proportion to projected toll income until the end of the concession. • Income for the transfer of the use of assets under concession (parking spaces, fibre optic cabling) that are recognised in the profit and loss account on a straight-line basis over the life of the concession. n) Commitments for pensions and other personnel-related liabilities Meeting the corresponding employment agreements, different companies of the Group have obligations to contribute to an employment system Pension Plan (Defined Contribution Plan) and, in respect of certain employees, the obligation to pay a retirement bonus or lump sum, under certain conditions. These commitments are externalised through an insurance policy. o) Trade and non-trade debtors and creditors The debits and credits incurred in operations, whether or not produced in the ordinary course of business, are recorded at nominal value, making the necessary valuation adjustments to cover bad debt provisions. Amounts due within one year of balance date are classified as short-term and amounts due after this date are considered long-term. 070 5. Financial information - 5.1. Consolidated Annual Accounts p) Corporate Income Tax The consolidated profit and loss account for the year reflects the Corporate Income Tax expense on fully consolidated companies. Its calculation includes tax accrued during the year, the effect of timing differences between the tax assessment base and book profit, as well as tax credits and deductions due to Group companies. abertis pays tax on a consolidated basis, together with those subsidiaries that meet the requirements established in current legislation (see Note 17). q) Foreign exchange differences Transactions in currencies other than the euro are recorded at the exchange rate on the transaction date. Exchange differences generated at the close of the financial year on current transactions are recorded as a loss in the profit and loss account, if negative, or deferred till maturity in the case of profits. r) Accounting for income and expenses Income and expenses are recorded on an accruals basis, that is, when the real transfer of goods and services takes place, irrespective of when the corresponding financial transaction occurs. s) Actions affecting the environment Amounts allocated annually to meet legal requirements related to the environment are recorded either as an expense or an investment, depending on their nature. The amounts recorded as investments are depreciated over their useful life. No allocation has been made for liabilities or expenses of an environmental natural, given that there are no contingencies related with the protection of the environment. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 071 Note 4. Intangible fixed assets The movement and balances of intangible fixed asset accounts in 2004 was as follows: R+D expenses Computer applications Balance Change in perimeter 31.12.03 6,495 34,140 — — Increase Decrease Transfers Exchange Balance difference 31.12.04 2,313 (475) (380) — 7,953 3,326 (1,076) 20 60 2 36,412 — 94,725 Administrative concessions 54,960 32,589 7,167 (51) Goodwill Studies and projects Other Total 209,775 1,101 18,965 — — 37 — 387 — — 362,615 — 572,390 (947) — — 541 (1) (256) — 18,745 325,436 32,626 13,193 (2.550) 362,059 2 730,766 The initial goodwill is basically derived from the acquisition of shareholdings in the companies aucat and tradia (157,950 and 44,000 thousand euros respectively). As a consequence of the merger in 2004 of abertis and Ibérica de Autopistas, S.A (see Note 1.b), the goodwill that was stated under consolidation goodwill (see Note 7) has been transferred to the intangible fixed assets account. The changes in accumulated amortisation during the year were as follows: Balance Change in 31.12.03 perimeter Increase Decrease Transfer Exchange Balance difference 31.12.04 R+D expenses Computer applications Administrative concessions Goodwill Studies and projects Other Total 3,073 18,826 22,508 19,114 216 7,506 — — 418 1,475 5,106 3,883 — 28,655 — (496) — — 2,147 (946) — — — — — — — — 4,548 2 23,438 — 26,809 — 47,769 — 1,417 919 — (1,503) — 6,922 71,243 418 42,185 (1,442) (1,503) 2 110,903 072 5. Financial information - 5.1. Consolidated Annual Accounts Note 5. Tangible fixed assets The movement and balances of the accounts under tangible fixed assets were as follows: Balance Change in perimeter 31.12.03 Increase Decrease Transfers Exchange difference Balance 31.12.04 Highway investment 6,085,044 Land and natural resources 13,676 Buildings and other constructions Other fixed assets Other fixed assets under construction Total 385,273 911,740 46,907 7,442,640 — — — 20 — 20 79,978 (40,728) 15,143 471 6,139,908 488 (505) 18 — 13,677 5,531 (4,193) 3,258 (117) 389,752 21,130 (8,710) 21,385 64 945,629 56,797 (2,140) (39,193) — 62,371 163,924 (56,276) 611 418 7,551,337 The changes in accumulated depreciation for the year were: Balance Change in perimeter 31.12.03 Increase Decrease Transfer Exchange difference Balance 31.12.04 Highway investment 221,081 — 33,337 (1,199) (34,206) (1,611) 217,402 Buildings and other constructions Other fixed assets Total 95,576 503,730 820,387 — — 15,447 (1,130) 64,472 (7,476) — 111 (7) 109,886 (72) 560,765 — 113,256 (9,805) (34,095) (1,690) 888,053 “Highway investment” includes the transfer in Iberpistas, S.A.C.E of the technical amortisation of the civil works to the reversion fund (as set out in the Financial-Economic Plan) of an amount of 34,183 thousand euros (see Note 15). Investments in fixed assets outside of Spain rose to 236,008 thousand euros (298,793 thousand euros gross less 62,785 thousand euros recorded as depreciation). Included under fixed assets are revertible assets of 6,464 million euros, under the terms of the concession agreement in each case, principally highway investment, including revaluations and adjustments of 3,194 million euros made under the applicable legal provisions. Most of the buildings and other constructions are linked to the administrative concessions conceded by different public corporations, which will revert to them at the end of the concession period. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 073 The following assets are fully depreciated: Highway investment Buildings and other constructions Tollgate machinery Tooling Other installations Furniture Computer equipment Other fixed assets Total gross book value Amount 56,045 5,553 51,253 3,270 230,859 3,011 9,342 3,256 362,589 It is the policy of Group companies to contract all the insurance policies considered necessary to cover any possible risks that could affect tangible fixed assets, with the exception of the buildings and installations of the service stations, where the concessionaire is responsible for insurance. The Group companies have also taken out the necessary civil liability insurance policies covering their activities in general. Note 6. Investments The movement and balances of investments were as follows: Balance Change in 31.12.03 perimeter Increase Decrease Transfer Exchange difference Balance 31.12.04 Holdings consolidated by equity accounting 593,123 135,534 145,795 (34,086) — 3,231 843,597 Loans to companies consolidated by equity accounting — — 16,015 — Long-term share portfolio 48,642 Long-term deposits and guarantees 4,497 — — 5,061 (1,665) — — 315 (116) (2,139) — — — 16,015 52,038 2,557 Other credits 188,195 1,079 7,727 (5,989) 8,934 — 199,946 Provisions Total (34,373) — (8,108) 169 — — (42,312) 800,084 136,613 166,805 (41,687) 6,795 3,231 1,071,841 074 5. Financial information - 5.1. Consolidated Annual Accounts The changes and breakdown of the companies consolidated by equity accounting are: Acesa Italia Brisa TBI Túnel del Cadí Iberacesa Aulesa Aurea Limited Elqui Coviandes Trados 45 Autema Irasa Cilsa Ciralsa Concema Torre de Collserola Arasur P. Autop. Chile Ltda. Parcheggi Bicocca SRL Proconex PTY Gicsa Ibermadrid Las Mercedes Port Mobility serviabertis Adesal Acesa SGPS Total Balance Change in perimeter 31.12.03 Increase Result Dividend/ Decrease for year Exchange difference Balance 31.12.04 181,323 131,080 — 23,850 79,700 (1,188) — 283,685 — — 18,000 (13,800) — 135,280 — 122,317 42,397 39,550 36,346 32,394 22,281 21,035 20,045 18,900 16,184 13,388 — — — — — — — — — — — 12,542 8,666 4,426 1,164 2,338 — 230 500 463 353 — — 7 3 50 — — — — 375 — — — — 200 150 — — (50) — — — — — — — — — 730 2,004 — 781 — — — — — — — — — — — — 848 — (1,215) (581) — — — — — 122,317 — 43,245 — 38,335 — 35,765 3,396 (1,907) 1,161 — (96) 324 33,787 23,766 4,975 (5,932) 2,926 23,004 3,799 (4,659) — 19,185 3,474 (3,408) — 18,966 2,574 (756) — — — — 18,002 — 13,380 — 12,542 (8) — 1,233 (1,210) — (90) 78 (331) — — — — 1,317 (1,000) 729 125 4 (11) — 9 — — (752) (230) — — — — — — — — — 33 — — 44 — — — — — — — 8,689 5,156 3,078 2,449 825 547 521 358 357 189 150 16 3 — 593,123 135,534 29,939 115,856 (34,086) 3,231 843,597 Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 075 abertis does not have any additional commitments with respect to the holdings consolidated by equity accounting apart from the investment itself, except for that detailed in Note 21.b. and in the Annex. The long-term share portfolio is basically composed of the shareholding in Xfera Móviles, S.A. (33,178 thousand euros), in Terra Mítica (7,513 thousand euros) and the holding in Port Aventura and USPA Hoteles. Both Xfera Móviles, S.A. and Terra Mítica are 100% provisioned. The transfer of “Long-term deposits and guarantees” corresponds to the transformation of the deposit that Saba Italia, S.p.A. has in its subsidiary Parcheggi Bicocca, S.r.l. into a loan and shareholding in the company. “Other credits”, in addition to the balance of 47,031 thousand euros to be recovered from the hedge mentioned in Note 3.c, carries the sum of 109 thousand euros from retevisión corresponding to tax credit arising from tax losses and timing differences (see Note 17). The reclassification from short to long-term of the prepaid taxes of abertis telecom is carried as a transfer. Note 7. Consolidation goodwill The movement during the year in consolidation goodwill was as follows: Balance 31.12.03 Included in Additions Disposal Amortisation perimeter Transfer Balance 31.12.04 176,674 — 105,331 1,899 — 98,397 — (6,096) — 170,578 (145) (5,761) — 101,324 — — — — — — — 1,708 — — — — — — — — — — — — — — — — — — — — — 72,295 65,445 29,872 28,394 26,153 13,637 12,116 6,159 6,265 3,778 141 68 — (648) (2,866) (1,164) (816) (819) (473) (303) (119) (360) (321) (16) — — — — — — — — — — — — — — — 98,397 — 71,647 — 62,579 — 28,708 — 27,578 — 27,042 — 13,164 — 11,813 — — — — 6,040 5,905 3,457 125 — — Ibérica de Autopistas 362,615 — (362,615) (68) — 908,943 100,296 1,708 (145) (19,830) (362,615) 628,357 Brisa saba Group TBI GCO Avasa Trados 45 aucat Autema Concema Cilsa Aulesa tradia Codad Coviandes Iberacesa Total 076 5. Financial information - 5.1. Consolidated Annual Accounts The additions to the consolidation goodwill are due to acquisitions detailed in Note 2d. The goodwill of Ibérica de Autopistas, S.A. was transferred to intangible fixed assets following the merger with abertis (see Note 4). The possible effect of the exchange rate risk on the goodwill of GCO is covered by the exchange rate hedges detailed in Note 21 d). Note 8. Deferred expenses The movement in deferred expenses during the year was as follows: Balance 31.12.03 Change in perimeter Increase Decrease Exchange difference Balance 31.12.04 Expenses in raising finance 10,177 Deferred expenses of financing highways Other deferred expenses Total 542,568 79,103 631,848 — — 62 62 3,367 (2,477) — 11,067 14,096 (22,616) — 534,048 73 (12,202) 17,536 (37,295) 105 105 67,141 612,256 The deferred financial expenses correspond to the financing of the highways of the companies aumar, Avasa and aucat. “Other deferred expenses” basically includes: • Expenses incurred in the construction of new buildings and for carrying out works to adapt the land and buildings owned by the Consorci de la Zona Franca de Barcelona, which are to be operated by Parc Logístic de la Zona Franca (32,605 thousand euros). • The advanced lease on part of the infrastructures of tradia (18,185 thousand euros). • The counterpart of the outstanding acesa debt owed to the Ministry of Public Works, which is being off-set by discounts payable by the Ministry (11,767 thousand euros). • The expenses derived from the hedging operations in the acquisition of 48.6% of GCO (see Note 21.d) for an amount of 3,931 thousand euros. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 077 Note 9. Accounts receivable The breakdown of this entry by type of activity is as follows: abertis Highways Car Parks Telecommunications Logistics Airports Total Amount 11,647 162,812 15,020 82,450 3,733 4,498 280,160 Note 10. Short-term investments The average yield on deposits held by Group companies during 2004 was 2.6% per annum. 078 5. Financial information - 5.1. Consolidated Annual Accounts Note 11. Equity The breakdown and movement in equity in the year ended 31 December 2004 was as follows: Balance Distribution result 31.12.03 Increase in capital Profit Other for year movements Balance 31.12.04 Share capital Share premium Parent company reserves 1,575,661 579,690 — — 78,783 — Revaluation res. RDL 7/1996 479,495 — (78,783) Legal reserve Voluntary reserves 158,668 258,259 32,902 87,865 Reserves in fully consol. companies (24,356) (7,700) Reserves -companies by equity accounting 10,200 4,739 Exchange differences (165,194) — — — — — — — — — — — — 1,654,444 — 579,690 — 400,712 — 191,570 6,932 353,056 — (20,300) (52,356) — 1,095 16,034 — (1,264) (166,458) Profit for year 355,206 (355,206) — 467,291 — 467,291 Interim dividend (120,275) 120,275 — — (126,289) (126,289) Total 3,107,354 (117,125) — 467,291 (139,826) 3,317,694 a) Share capital The share capital of abertis is made up of 551,481,375 registered shares with a par value of 3 euros per share, fully subscribed and paid up. Of these, 514,445,009 shares are Class A and 37,036,366 are Class B preference shares that have the same rights as the ordinary shares, and additionally, have the right to a preferential dividend that will be paid once to holders of said shares in 2007. The maximum amount of the preferential dividend on each preference share will be the difference between the reference price of 14.87 euros per share and the average weighted price of the ordinary abertis shares in the quarter prior to the due date, with a maximum payment of 4.25 euros per share. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 079 As the shares of abertis are bearer shares, the exact participation of shareholders in the share capital is not known. However, based on the information available, the most significant holdings at 31 December 2004 are the following: Caixa d’Estalvis i Pensions de Barcelona (”la Caixa”) ACS, Actividades de Construcción y Servicios, S.A. Caixa d’Estalvis de Catalunya Sitreba, S.L. 23.99% (1) 17.58% 5.69% 5.50% 52.76% (1) Caixa Barcelona Seguros de Vida, S.A. de Seguros y Reaseguros (11.844%), VidaCaixa, S.A. de Seguros y Reaseguros (0.504%), Inversiones Autopistas, S.L. (7.753%) and CaixaHolding, S.A., Sociedad Unipersonal (3.890%). All the shares of the Company are listed on the stock exchanges of Barcelona, Bilbao, Madrid and Valencia, being traded on the Spanish electronic trading system. The ordinary Class A shares are traded on the main board (continuous market) and form part of the Ibex 35 index. The Class B preference shares are traded under the Fixing mode, where single prices are set. In addition, options on the shares of the Company are traded on the options market of MEFF Renta Variable (Spanish Equities Futures Exchange). The Company’s Annual Shareholders’ Meeting on 27 April 2004 agreed to pay a final dividend for 2003 of 0.223 euros gross per share, which represents 117,125 thousand euros. At said Shareholders’ Meeting a bonus share issue was also approved, to be charged against the Revaluation Reserve Account, as per Royal Decree-law 7/1996, dated 7 June, with one new share for every 20 shares, representing a sum of 78,783 thousand euros. The Board of Directors was authorised by the Annual General Meeting of 8 April 2003 to increase share capital, through one or more capital issues, up to a maximum amount of 518,445 thousand euros, during the period up to 8 April 2008. This power remains fully operative. 080 5. Financial information - 5.1. Consolidated Annual Accounts b) Revaluation Reserve of Royal Decree-law 7/1996, of 7 June This reserve originates from the revaluation of the fixed assets in the balance sheet of the Company, by virtue of Article 5 of the above legislation. After three years have passed from the balance sheet date and the revaluation has not been questioned by the Tax Administration, the revaluation operations are deemed to be correct and the balance of the account to be accepted by the Tax Authorities, and accordingly, the balance will be available for distribution to: • Offset book losses. • Increase share capital. • Create reserves freely available for distribution, ten years from the date of the balance sheet stating the revaluation operations. The balance of this account cannot be distributed, directly or indirectly, unless the capital gain has been realised, with the understanding that this is the case when the revalued assets have been fully amortised, transferred or written off. Given the nature of the activity transferred of the subsidiary company acesa in 2002, the requirement that the capital gain be realised can only be understood as such when the company acquiring the revalued assets as part of the new activity has amortised, transferred or written them off. c) Legal reserve In accordance with the revised text of the Spanish Companies Act, 10% of the annual profits must be allocated to the legal reserve until this reserve reaches at least 20% of share capital. The legal reserve cannot be distributed to shareholders unless the Company is wound up. The legal reserve can be used to increase capital, provided the funds used come from the balance exceeding 10% of the capital that has been increased. Apart from the purpose mentioned above, so long as this reserve does not exceed 20% of share capital, it can only be used to offset losses when there are no other reserves available for this purpose. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 081 d) Reserves in fully consolidated companies and companies consolidated by equity accounting The breakdown by companies of these entries is as follows: saba Group acesa Group abertis logística Group aumar iberpistas Group Codad abertis telecom Group Total reserves in fully consolidated companies Coviandes Aurea Ltd acesa Group Elqui Iberpistas Chile Group abertis logística Group Irasa Group GICSA PTY serviabertis Trados 45 APR Concema iberpistas Group Aulesa Ausol Total reserves in companies consolidated by equity accounting Amount 14,176 3,222 3,025 41 (11,237) (11,605) (49,978) (52,356) Amount 18,203 9,715 6,637 4,955 1,829 1,065 474 404 243 7 (323) (408) (409) (479) (546) (25,333) 16,034 082 5. Financial information - 5.1. Consolidated Annual Accounts The negative reserves of the iberpistas Group are due partly to the impact of the amortisation of treasury stock of 10 million euros in 2003 following the compulsory Public Takeover Offer and partly because the amounts distributed as dividends by Group companies are adjusted in the consolidation process, increasing the reserves of the parent company and not those of the companies that have paid out. e) Exchange differences The breakdown of this account by company is as follows: Ausol Codad Coviandes ACDL Aurea Ltd Elqui Iberpistas Chile Group saba Group PTY iberpistas Total exchange differences Amount (122,215) (18,182) (10,675) (5,582) (5,154) (4,631) (1,310) (339) 65 1,565 (166,458) The exchange difference in Ausol reflects the impact of the devaluation of the Argentine peso. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 083 Note 12. Minority interests The balance of this entry at 31 December corresponds to the shareholding held by minority shareholders in the book value on that date of the fully consolidated companies, with the movement during the year as follows: Balance 31.12.03 Change in holding Results Dividend Exchange difference Balance 31.12.04 ACDL Saba Italia GCO Sevisur Satsa saba Rabat Codad Spel Spasa Iberpistas, S.A.C.E. Total — 22,692 — (620) 22,072 — 11,856 12,925 6,066 1,176 1,056 1,011 749 4,287 — 44 530 13 — — (130) (74) — — 250 (10) (530) — — — — — (55) — (1,082) 2,167 (69) 107 112 (17) (723) — — — (24) (1,521) (486) (1,700) 29 14 — — — — — — — 7,510 1,107 1,033 994 708 580 279 48 — 27,844 22,211 (260) (541) (3,067) 46,187 Note 13. Negative consolidation differences The movement in this entry during 2004 was as follows: Saba Italia Túnel del Cadí Aurea Ltd retevisión Total Balance 31.12.03 8,306 13,281 2,467 16,835 40,889 Decrease Charge to results Balance 31.12.04 — — — (512) (512) (154) (696) (112) 8,152 12,585 2,355 — 16,323 (962) 39,415 084 5. Financial information - 5.1. Consolidated Annual Accounts Note 14. Deferred income The movement during the year was as follows: Grants Other deferred income Total Balance 31.12.03 38,968 56,605 95,573 Increase Charge to results Exchange difference Balance 31.12.04 188 1,628 1,816 (5,272) (3,722) (8,994) — 89 89 33,884 54,600 88,484 The capital grants basically correspond to retevisión, of which 18,477 thousand euros are grants from the European Regional Development Fund (FEDER). “Other deferred income” at 31 December 2004 mainly includes: • Payment to aumar from the Public Administration for works carried out in Sagunto, for 20,408 thousand euros. • • Income from the sale of car parks under saba concession. The Balance at 31 December 2004 totals 20,507 thousand euros. Income received by acesa for the transfer of the use of fibre optic cables, of 10,603 thousand euros. Note 15. Provisions for liabilities and expenses The movements in this account for the year ended 31 December 2004 are as follows: Balance 31.12.03 Allocations Application Transfers Exchange difference Balance 31.12.04 Reversion fund (see Note 3.k) Other provisions (see Note 3.l) 2,213,112 140,790 (6,309) 34,183 889 2,382,665 72,302 6,717 (10,899) — (206) 67,914 Total 2,285,414 147,507 (17,208) 34,183 683 2,450,579 Transfers in the “Reversion fund” include the transfer from Iberpistas, S.A.C.E of the technical amortisation of the civil works (as stated in the Financial Plan) for an amount of 34,183 thousand euros (see Note 5). Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 085 Note 16. Bond issues and loans from credit institutions The table below shows the balance of current credit operations at the end of 2004. 2005 2006 2007 2008 2009 Other maturities Total Bonds issued 178,050 9,573 10,444 10,444 189,573 1,175,824 1,573,908 Syndicated loans — 2,500 101,000 17,500 20,000 50,000 191,000 Loans 89,031 157,574 46,854 16,827 36,677 676,355 1,023,318 Credit lines 283,499 — — — — — 283,499 Others Total 120,468 51,140 54,430 56,107 35,165 98,421 415,731 671,048 220,787 212,728 100,878 281,415 2,000,600 3,487,456 At 31 December Group companies had debts in foreign currencies, principally held by Abertis Infraestructuras Finance BV (US dollars), abertis (pounds sterling), Codad (US dollars), and GCO (Argentine pesos), for the amounts of 371,463; 204,224; 62,445 and 36,585 thousand euros, respectively. In the case of the debt of GCO, the toll income is pledged as guarantee for the repayment of these debts. Abertis Infraestructuras Finance BV has contracted financial instruments to hedge the US dollar/euro exchange rate, with the same nominal value and maturity as the bond issue made in dollars. acesa has guarantees arranged in certain circumstances on bank loans granted to the Argentine subsidiary company GCO, with the outstanding balance pending payment at 31 December 2004 of 147,224 thousand Argentine pesos (36,585 thousand euros). At 31 December the Group companies had contracted several financial operations (swaps and collars) to act as a hedge on financing costs of loans for a nominal amount of 2,038,725 thousand euros. Of these operations, 780,910 thousand euros were signed with related credit institutions (shareholders of abertis that hold 5% or more of its share capital). Part of the loan and credit operations that are shown as debts with credit institutions at 31 December 2004 (287,342 thousand euros long-term and 16,927 thousand euros short-term), were signed with credit institutions related to abertis, at market interest rates. The weighted average annual interest rate on long-term bonds and loans with credit institutions is approximately 5.06%. Short-term loans are expected to be refinanced in 2005. 086 5. Financial information - 5.1. Consolidated Annual Accounts Note 17. Tax situation abertis calculates tax in 2004 on a consolidated basis, as the parent company of the tax Group that includes the following subsidiary companies: abertis logística, abertis telecom, acesa, serviabertis, aucat, tradia, Adesal, Iberacesa, Isgasa, Iberpistas, S.A.C.E, castellana, Iberavasa, Proconex, Ibermadrid, aumar, Aulesa, Gicsa, retevision, saba, Satsa and Parbla. The reconciliation of the difference between the reported profit before tax in the accounts and the profit subject to Corporate Income Tax is detailed in the notes to the annual accounts of each company. The reconciliation of the consolidated results and the aggregate tax assessment base for all the consolidated companies, including consolidation adjustments, is as follows: Consolidated profit before tax Permanent differences Timing differences - arising during the year - from previous periods Tax losses carried forward Tax assessment base Amount 678,257 -45,111 28,517 1,708 -46,079 617,292 The tax effect of accrued Corporate Income Tax expense during the year off-set against tax losses carried forward is 15 thousand euros. In calculating the tax payable, the companies of the consolidated Group have applied deductions to avoid the double taxation internally on dividends received, as well as deductions on investments associated with the undertaking of various activities, for a total amount of 15,415 thousand euros. In addition, the Group has recorded taxes paid outside of Spain similar to Corporate Income Tax for the sum of 2,079 thousand euros and the adjustments to the calculation of the expense accrued in 2003 after having filed the corresponding returns for an amount of 2,975 thousand euros. The balance at 31 December 2004 of prepaid tax totals 23,393 thousand euros (31,123 thousand euros at 31 December 2003), largely made up of valuation differences and timing differences between tax and accounting criteria for recording income and expenses. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 087 The balance at 31 December 2004 of the deferred tax totalled 100,070 thousand euros (120,641 thousand euros at 31 December 2003), which mainly corresponds to the following items: • Calculation of tax on income from forward operations on a cash basis, and similarly, the reversal of profit from Spanish companies that have set up internationally; both relate to previous years. • Deferred taxes recorded in aumar and Avasa as the result of applying the single transaction provision of the Order of 10 December 1998 approving the standards of the General Accounting Plan for concessionaire companies of highways, tunnels, bridges and other toll routes and in application of the fiscal legislation. The tax loss carry forwards available for offset for the companies of the consolidated accounting Group at 31 December 2004 totalled 343,736 thousand euros, falling due from 2005 to 2018. Of these tax loss carry forwards, a sum of 113,072 thousand euros is registered as a tax credit under Accounts Receivable-Public Treasury. On 9 June 2004 the agreement on the merger between Abertis Infraestructuras, S.A. through the complete takeover of Ibérica de Autopistas, S.A. was made public and the resulting winding up without liquidation of the latter (see Note 1.b). This operation was carried out under the special fiscal regime of Chapter VIII of Title VIII of the Corporate Income Tax Act, now Chapter VIII of Title VII of the Royal Decree Legislation 4/2004, of 5 March, which approved the Amendment to the Corporate Income Tax Act. As a consequence of the merger, the acquiring company took over the entire equity of the acquired company under universal title, subrogating all the tributary rights and obligations conveyed in the goods and rights transferred. In general, the companies that form part of the abertis Group are open to inspection for the last four years for all the taxes. abertis has received the corresponding Tax Assessments raised by the inspection based on audits made between 1989 and 1993 and for 2000, of a partial nature and under a consolidated fiscal regime, which the company has signed in disagreement. These assessments have been appealed and are pending the decision of the authorities. In addition, inspections of a general nature into the years 2000 to 2002 have begun during 2004, but are limited to Abertis Infraestructuras, S.A. After the close of the financial year, the Tax Administration has initiated various proceedings. The impact that may be derived from these assessments on the Company’s equity has been provided for. Additionally, due to possible differences in the interpretation of the tax regulations applicable to certain operations, there are specific tax liabilities of a contentious nature that are difficult to quantify. Nevertheless, the amount of tax that may be payable would not have a material impact on the Consolidated Annual Accounts of the Company. 088 5. Financial information - 5.1. Consolidated Annual Accounts Note 18. Income and expenses a) Distribution of income The breakdown of the net income by activity and markets for the ordinary activities of the Group is as follows: abertis - National Highway operations National International Car park operations National International Telecommunication infrastructures National International Logistic infrastructures – National Airport operations – International Total b) Toll income 1,076,543 26,184 66,301 21,745 258,363 2,113 Amount 1,953 1,102,727 88,046 260,476 15,246 20,692 1,489,140 After the close of the financial year the Group received and recorded 14 million euros as income for 2005, compensation for the rate revision not authorised by the Ministry of Public Works for the year 2000 for the highways under State Control. The impact on rates for the years 2001, 2002 and 2003 is the object of a claim filed by the Company in the courts. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 089 c) Personnel The average workforce of the parent company and Group companies is as follows: Permanent staff Temporary staff Total d) Foreign currency transactions 4,860 644 5,504 The transactions made in foreign currency principally come from GCO (Argentine pesos) and Codad (US dollars and Columbian pesos) with the breakdown in thousand euros shown as follows: Toll income Services provided Services received Interest expenses on financing e) Extraordinary results Amount 29,568 21,376 16,149 16,135 The entries for extraordinary expenses and income are generated primarily from the charge to results of deferred expenses and income from the consolidated balance sheet. 090 5. Financial information - 5.1. Consolidated Annual Accounts f) Contribution of each Company to consolidated results The contribution by companies to the results due to the Parent Company is as follows (the amortisation of the consolidation goodwill assigned to the parent company of the corresponding subgroup): Consolidated result Minority interests Result due to parent co. acesa aumar Acesa Italia (Schemaventotto) Iberpistas, S.A.C.E. aucat Brisa saba Group Iberavasa Group retevisión Coviandes Trados 45 Autema Aurea Ltd GCO Proconex Concema Elqui Túnel del Cadí PTY abertis logística Group tradia Gicsa Iberpistas Chile Group Acesa SGPS serviabertis Ibermadrid 196,079 139,244 79,700 39,568 23,298 18,000 14,194 10,891 7,003 4,975 3,799 3,474 3,396 4,215 1,317 1,233 1,161 848 729 205 225 125 78 44 9 4 — — — — — — 837 — — — — — — (2,167) — — — — — 69 — — — — — — 196,079 139,244 79,700 39,568 23,298 18,000 15,031 10,891 7,003 4,975 3,799 3,474 3,396 2,048 1,317 1,233 1,161 848 729 274 225 125 78 44 9 4 (continued on next page) Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 091 (continued) AI Finance BV castellana Aulesa Irasa Iberacesa Sub-group abertis telecom Codad abertis Total Consolidated result Minority interests Result due to parent co. (23) (91) (581) (756) (1,215) (5,948) (10,142) (68,027) 467,031 — — — — — — 1,521 260 (23) (91) (581) (756) (1,215) (5,948) (8,621) (68,027) 467,291 The results for the year of Acesa Italia is mainly due to the capital gain obtained on the sale of 10% of Autostrade by Schemaventotto (60 million euros) and the sale of 5% of abertis by Autostrade (10 million euros). Note 19. Environment The criteria of the Group is to give maximum importance to the activities of protecting and conserving the environment, and each subsidiary company has adopted the necessary measures to minimise the environmental impact of the infrastructures managed, to achieve the maximum possible integration with their surroundings. The abertis Group in 2004 has invested the sum of 5,243 thousand euros on improving the environment, through the following actions: • Cutting, fertilising, watering and phytosanitary treatment of green highway verges, on ramps and off-ramps. • Clearing and upkeep of green zones along the highway. • Cleaning up and clearing of forested slopes and/or in semi-urban or urban zones to avoid the risk of fire and improve visual appearance of the highway. 092 5. Financial information - 5.1. Consolidated Annual Accounts • Restoration and improvement of margin areas destroyed by fires by replanting native trees. This will lead to an improved landscape, whilst also helping to increase the forestry value of the highway. • Installation of both visual screens and vegetation to reduce the visual impact and noise levels at certain points of the highway. • Special repaving to enhance the absorption of sound generated by traffic. • Works to improve the rest areas and the areas surrounding tollgates by planting new species and installing both natural and artificial screens for greater integration and safety to impede the entry of unauthorised personnel to these installations. • Construction of animal paths so that animals can pass from one side of the highway to the other without having to cross the highway. • Complete conservation of the green zones in the rest areas, tollgates and maintenance areas, as well as along the highways and around the on-ramps and off-ramps. Note 20. Information on Board Members In accordance with the provisions of Article 127 ter. 4 of the Spanish Companies Act, pursuant to Law 26/2003, of 17 July, which amended the Securities Exchange Act 24/1988, of 28 July, and the Amendment to the Spanish Companies Act, aimed at increasing the transparency of listed companies, the companies with the same, similar or complementary business activity of Abertis Infraestructuras, S.A., in which members of the Board of Directors have shareholdings, as well as their functions, if applicable, excluding those companies controlled by the abertis Group. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 093 Shareholder Company Activity Shareholding Functions ACS, Actividades de Construcción y Servicios, S.A. Dragados Concesiones de Infraestructuras, S.A. Concesionaria Vial de los Andes Infrastructures Concessionaire Dragados Concesiones de Infraestructuras, S.A. and subsidiary companies as listed Autovía de la Mancha, S.A. Bidelan Gipuzkoano Autobideak, S.A. Sociedad Concesionaria Autopista Central, S.A. Aerocali, S.A. Ferrocarriles del Norte de Colombia, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Aeropuertos Mexicanos del Pacífico, S.A. de C.V. Infrastructures Concessionaire MBJ Airports Ltd Road Management A13 plc Road Management Services (Darrington) Holding Ltd Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Bakwena Platinum Corridor Concesionaire Ltd Infrastructures Concessionaire Pt Operational Services Ltd Tag Reg, S.A. TP Ferro Concesionaria, S.A. Celtic Road Group Road Users Services Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire 0.96% 99.99% 66.67% 50.00% 48.00% 33.33% 71.32% 28.16% 35.00% 25.00% 25.00% 25.00% 33.33% 50.00% 50.00% 3.33% 27.00% — — — — — — — — — — — — — — — — — (continued on next page) 094 5. Financial information - 5.1. Consolidated Annual Accounts (continued) Shareholder Company Activity Shareholding Functions Dragados Concesiones de Infraestructuras, S.A. Inversora de Infraestructuras, S.L. Infrastructures Concessionaire Sociedad Concesionaria Infrastructures Vespucio Norte Express, S.A. Concessionaire Circunvalación de Alicante, S.A. Accesos de Madrid, C.E.S.A. Autopista Central Gallega, C.E.S.A. Autopista del Henares, C.E.S.A. Ruta de los Pantanos, S.A. Carmelton Group LTD Rutas del Pacífico, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Desarrollo de Concesiones Ferroviarias, S.L. Infrastructures Concessionaire Guadalquivir Sociedad Infrastructures Concesionaria de la Junta de Concessionaire Andalucía Guadalmetro, S.A. Desarrollo de Concesiones Aeroportuarias, S.L. Infrastructures Concessionaire SCL Terminal Aeropuerto Santiago, S.A. Infrastructures Concessionaire Scutvias-Autostradas da Beira Interior, S.A. Autopistas del Sol, S.A. Caixa de Catalunya Túnel del Cadí Retevisión Móvil, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire 99.99% 54.00% 50.00% 15.75% 13.32% 35.00% 25.00% 40.00% 50.00% 99.99% 27.83% 99.99% 14.78% 26.65% 8.18% 3.55% 2.10% — — — — — — — — — — — — — — — — — (continued on next page) Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 095 (continued) Shareholder Company Activity Shareholding Functions Dragados, S.A. (Previously Dragados Obras y Proyectos, S.A.) Ferrocarriles del Norte de Colombia, S.A. Infrastructures Concessionaire Aufe, S.A. Aunor, S.A. Concesionaria Vial del Sur, S.A. Autopistas del Sol, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire 5.32% 78.00% 85.00% 25.00% 6.40% Isidro Fainé Casas Telefónica, S.A. Communication 0.0001% Ángel García Altozano ACS, Actividades de Construcción y Servicios, S.A. José Luis Olivas Martínez Acciona, S.A. Grupo Ferrovial, S.A. Construction and Services Infrastructures Concessionaire Infrastructures Concessionaire 0.01% 0.0008% 0.0008% Montes de Piedad y Caja de Ahorros de Ronda, Cádiz, Almería, Málaga y Antequera (Unicaja) Telefónica, S.A. Telecommunications 0.0002% Ausur, Servicios de la Autopista, S.A. Logistics 5.00% Autopista del Sol, Infrastructures Concesionaria Española, S.A. Concessionaire Autopista del Sureste, Concesionaria Española de Autopistas, S.A. Infrastructures Concessionaire Inversora de Autopistas del Sur, S.L. Infrastructures Concessionaire Autopista Madrid Sur, Infrastructures Concesionaria Española, S.A., Concessionaire Sociedad Unipersonal 15.00% 5.00% 10.00% 10.00% — — — — — Deputy Chairman Corporate General Manager — — — — — — — — (continued on next page) 096 5. Financial information - 5.1. Consolidated Annual Accounts (continued) Shareholder Company Activity Shareholding Functions Montes de Piedad y Caja de Ahorros de Ronda, Cádiz, Almería, Málaga y Antequera (Unicaja) Autopista de la Costa Cálida, Concesionaria Española de Autopistas, S.A. Sociedad Municipal de Aparcamientos y Servicios, S.A. Centro Integral de Mercancías, S.A. Red de Banda Ancha de Andalucía, S.A. Infrastructures Concessionaire 4.50% Board Member Car parks 24.50% — Logistics 10.28% Telecommunications 10.00% Auna Operaciones de Telecomunicaciones, S.A. Telecommunications 2.21% Islalink, S.A. Telecommunications 13.70% Val de Telecomunicaciones, S.L. ACS, Actividades de Construcción y Servicios, S.A. Telecommunications 4.46% Construction 0.003% Pablo Vallbona Vadell — — Board Member — — Deputy Chairman With respect to offices or functions, and in accordance with the legislation previously mentioned, a list of the Board Members that hold positions in companies with the same, similar or complementary activity as the business activity of the Company is set out overleaf. Those companies controlled by the abertis Group have not been included. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 097 Shareholder Company Activity Position ACS, Actividades de Construcción y Servicios, S.A. Dragados, S.A. Construction Board Member ACS, Servicios, Comunicaciones y Energía, S.L. Construction and Services Board Member ACS, Servicios y Concesiones, S.L. Construction and Services Board Member Salvador Alemany Mas Centro Intermodal de Logística, S.A. Logistics Deputy Chairman Accesos de Madrid, Concesionaria Española, S.A. Highway Concessionaire Deputy Chairman Alazor Inversiones, S.A. Highway Concessionaire Board Member Autostrade, S.p.A Highway Concessionaire Board Member Autostrade per l’Italia, S.p.A Highway Concessionaire Board Member (until 5/11) Gilberto Benetton Autostrade, S.p.A Highway Concessionaire Board Member Isidro Fainé Casas Autostrade, S.p.A. Highway Concessionaire Board Member (until 15/10) Brisa, Auto-estradas de Portugal, S.A. Highway Concessionaire Board Member Ángel García Altozano ACS, Servicios, Comunicaciones y Energía, S.L. Construction and Services Board Member ACS, Servicios y Concesiones, S.L. Construction and Services Board Member Dragados Concesiones de Infraestructuras, S.A. Construction and Services Board Member Dragados, S.A. Construction Board Member ACS-Sonera Telefonía Móvil, S.L. Communication Xfera Móviles, S.A. Communication Broadnet Consorcio, S.A. Communication Chairman Chairman Chairman Vías y Construcciones, S.A. Construction Board Member Cobra Instalaciones y Servicios, S.A. Construction and Services Board Member Telefónica Internacional Communication Board Member Miguel Ángel Gutiérrez Méndez Telefónica Argentina Communication Board Member Pablo Vallbona Vadell ACS, Actividades de Construcción y Servicios, S.A. Construction Deputy Chairman (non-Executive) Additionally, one of the main activities of the ACS Group is the promotion, management and operation of transport infrastructures. 098 5. Financial information - 5.1. Consolidated Annual Accounts Note 21. Other information a) Annual remuneration of the Board Members for their services to the Board of Directors of the Company is fixed as a share of the net profits. Such remuneration can only be paid out once the payment of dividends and transfers to reserves required by law are covered and cannot exceed, under any circumstances, two percent of the profits. The Board of Directors may distribute this sum amongst its members in the form and amount it decides. Overall remuneration paid to directors of Abertis Infraestructuras, S.A., as members of the Board of Directors, totalled 1,533 thousand euros in 2004, which is less than the statutory limit. Total remuneration received by the Board Members of Abertis Infraestructuras, S.A. was 2,014 thousand euros, which corresponds to fixed remuneration. In addition, other benefits that Board Members of Abertis Infraestructuras, S.A. have received are contributions made to cover pension liabilities (1,759 thousand euros) and life insurance (37 thousand euros). The total remuneration to Board Members of Abertis Infraestructuras, S.A. in the other companies of the Group totalled 646 thousand euros and 246 thousand euros in associated companies. Abertis Infraestructuras, S.A. does not use a system linked to the evolution of the Company’s share price for the remuneration of any of its employees or any of the members of the Board of Directors. b) At 31 December the Group has given the following guarantees to third parties provided by financial entities, broken down by company as follows: abertis saba acesa aumar castellana retevisión tradia Avasa aucat Sevisur Iberpistas, S.A.C.E. Total Amount 122,171 38,547 21,258 19,232 17,888 10,335 3,769 3,720 2,546 522 36 240,024 Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 099 Out of the total guarantees, 93,545 thousand euros corresponded to guarantees given in relation to the operating agreements of different companies. The rest correspond to certain commitments contracted by the subsidiary companies (investments, financing, etc). It is not expected that these guarantees will lead to unexpected material liabilities. c) Fees received during the year by PricewaterhouseCoopers Auditores, S.L. from abertis and its Group companies for statutory auditing services totalled 335 thousand euros and for other audit work provided totalled 90 thousand euros. In addition, the fees received during the year by other companies trading under the name PricewaterhouseCoopers for audit services and other services provided totalled 97 and 411 thousand euros, respectively. d) In the year 2000, abertis contracted exchange rate hedges on the investment made in the Argentine company GCO. The following financial instruments have been contracted: • Transactions without the exchange of principal on expiry (Non Delivery Forward). The nominal value of all these transactions is USD 120.6 million. abertis sells 120.6 million Argentine pesos in exchange for USD 120.6 million, with expiry in October 2005, having fixed the exchange rate to buy Argentine pesos on expiry in 2002. • Cross-currency interest rate swap (Cross-Currency IRS) between USD and Euros. The current value of these transactions is USD 100 million, with expiry in October 2005. The premiums paid up front for the hedging transactions are accounted for on a straight-line basis over the period of the transaction (see Note 3.h.). The interest payments of the cross currency interest rate swap are recorded as financial income or expense over the period of the operation. The exchange rate differences arising from the exchange of euros in these transactions will be recorded on the cancellation or settlement of the hedging transaction. e) The Company is analysing the impact that the new international accounting standards (IAS) will have on the consolidated financial statements of abertis, which may be affected by the specific interpretation of the IAS for concessionaires, which was being analysed and studied by the international regulatory bodies at the time of preparing these Consolidated Annual Accounts. 100 5. Financial information - 5.1. Consolidated Annual Accounts Note 22. Financial plan In accordance with the provisions laid down in current legislation, the Spanish highway concessionary companies have their respective financial plans approved by the corresponding Administration. Note 23. Subsequent events During 2005, ACDL has completed the Public Takeover Offer for the Shares of the TBI group, taking control of 100% of the share capital. saba acquired in January 2005 40% of its Italian subsidiary Saba Italia from Autostrade. On completing the operation, which involved an investment of 11.3 million euros, saba gained full control of Saba Italia. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 101 ANNEX* Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Share capital % Shareholding direct Company owning indirect indirect shareholding FULLY CONSOLIDATED Abertis Infraestructuras Finance, B.V. Rokin, 55 1012KK. Ámsterdam (Netherlands) Highway operations Autopistas, C.E.S.A. (ACESA) Av. del Parc Logístic, 12-20. Barcelona Autopistes de Catalunya, S.A. (AUCAT) 12-20. Barcelona Av. del Parc Logístic, Autopistas-Conces. Espanhola, SGPS, S.A. Rua General Norton de Matos, 21-A. Arquiparque Algés Oeiras. (Portugal) Financing — 18 100.00 — — Toll highway concessionaire Toll highway concessionaire Holding company of concessionaires PwC 876,465 100.00 — — PwC 96,160 100.00 acesa PwC 1,000 100.00 — acesa Grupo Concesionario del Oeste, S.A. (GCO)(1) Ruta Nacional, nº 7, km 25,92. Ituzaingó (Argentina) Toll highway concessionaire PwC 20,160 — 48.60 acesa Autopistas Aumar S.A.U.C.E (AUMAR) Paseo de la Alameda, 36. Valencia Toll highway concessionaire PwC 419,643 100.00 PwC 50,000 100.00 — — — — Iberpistas, S.A.U.C.E. Pío Baroja, 6. Madrid Castellana de Autopistas, Pío Baroja, 6. Madrid S.A.U.C.E. (Castellana) Toll highway concessionaire Toll highway concessionaire PwC 46,800 — 100.00 iberpistas Pío Baroja, 6. Madrid Holding company PwC 24,207 — 100.00 iberpistas Iberavasa de Inversiones, S.L.U. Car parks Saba Aparcamientos, S.A. Av. del Parc Logístic, Car park operator PwC 18,243 99.26 — — (SABA) 12-20. Barcelona Saba Estacionamientos Andrés Bello, 2777. Car park operator PwC 11,500 — 99.26 saba de Chile, S.A. Las Condes. Santiago (Chile) Concesionaria Subterra Andrés Bello, 2777. Car park operator PwC 1,248 — 99.26 Saba Chile Las Condes. Santiago (Chile) Concesionaria Subterra Dos Andrés Bello, 2777. Car park operator PwC 805 — 99.26 Saba Chile Las Condes. Santiago (Chile) * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. 102 5. Financial information - 5.1. Consolidated Annual Accounts Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Share capital % Shareholding direct Company owning indirect indirect shareholding FULLY CONSOLIDATED Spel-Sociedade de Parques de Guedes de Azevedo, Car park operator PwC 6,000 — 99.26 saba 148-180. Estacionamento, Porto (Portugal) S.A. (Spel) Liz Estacionamientos Guedes de Azevedo, Car park operator PwC 500 — 50.62 Spel 148-180. Porto (Portugal) Parbla, S.A. Sabino Arana, 38. Car park operator — 3 — 99.26 saba Barcelona Societat Pirenaica Pau Casals, 7. Car park operator — 301 — 89.33 saba d’Aparcaments, S.A. Escaldes-Engordany (Spasa) (Principality of Andorra) Societat d’Aparcaments Plaça Vella, subsuelo. Car park operator PwC 7,313 — 87.39 saba de Terrassa, S.A. (Satsa) Terrassa Saba Italia, S.p.A. Via delle Quattro Car park operator PwC 28,600 — 59.56 saba Fontane, 15. Rome (Italy) Saba Campo San Giacomo Via delle Quattro Car park operator — 100 — 58.96 Saba Italia Fontane, 15. Rome (Italy) Parcheggi Pisa Via delle Quattro Car park operator — 50 — 41.69 Saba Italia Fontane, 15. Rome (Italy) Rabat Parking, S.A. Rue de Larache, 8. Car park operator Other 1,879 — 50.62 saba Rabat (Morocco) auditors Logistic Services Abertis Logística, S.A. Av. del Parc Logístic, Promotion, logistics PwC 55,832 100.00 — 12-20. Barcelona and technical assistance Sevisur Logística, S.A. Moratín, 1. Seville Construction and PwC 3,000 — 60.00 Telecommunications operation of logistic areas abertis logística Abertis Telecom, S.A. Av. del Parc Logístic, Telecommunication — 300,000 100.00 — — 12-20. Barcelona services Difusió Digital Societat de Telecomunicacions, S.A. (TRADIA) Motors, 392. L’Hospitalet Operator of Other 131,488 — 100.00 de Llobregat. Barcelona telecommunication auditors infrastructures abertis telecom * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 103 Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Share capital FULLY CONSOLIDATED % Shareholding direct Company owning indirect indirect shareholding Retevisión I, S.A. Gran Via de les Corts Operator of Other 81,270 — 100.00 Catalanes, 130-136. telecommunication auditors Barcelona infrastructures abertis telecom Airports Airport Concession 159 New Bond Street Holding company — 22,072 90.00 — and Development London W1S 2UD Limited (ACDL) (United Kingdom) of airport companies Compañía de Desarrollo Carrera, 13, 93-40. Construction Aeropuerto Eldorado, S.A. (CODAD) Santafé de Bogotá (Colombia) and maintenance of airports Other auditors 11,455 85.00 CONSOLIDATED BY PROPORTIONAL INTEGRATION Highway operations Autopistas Barrio de Anuntzibai, Toll highway Other 234,000 50.00(2) Iberavasa Vasco-Aragonesa, s/n, 48410. Orozco. concessionaire auditors C.E.S.A. (AVASA) Vizcaya Logistic services Parc Logístic de la Zona Av. del Parc Logístic, Promotion and Franca, S.A. (PLZF) 12-20. Barcelona Areamed 2000, S.A. Via Augusta, 21-23. Barcelona operation of logistic areas Operation of service areas Other auditors Other auditors 23,742 50.00 70 50.00 abertis logística abertis logística * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. 104 5. Financial information - 5.1. Consolidated Annual Accounts Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Share capital CONSOLIDATED BY EQUITY ACCOUNTING % Shareholding direct Company owning indirect indirect shareholding Serviabertis, S.L. Av. del Parc Logístic, Administrative and PwC 3 100.00 — 12-20. Barcelona management services Highway operations Aurea Limited 180 Strand, London Holding company Other 14,182 100.00 (United Kingdom) of concessionaires auditors Promoción de Autopistas Gertrudis Echenique, 30. Toll highway PwC 527 100.00 — — Chile Limitada Las Condes- Santiago concessionaire (Iberpistas Chile) (Chile) Gestión Integral de Montalbán, 5. Madrid Administration and — 60 100.00 — Concesiones, S.A. (GICSA) management of infrastructures Autopistas de León, Villadangos del Páramo, Toll highway PwC 34,642 79.20 — S.A.C.E. (AULESA) ctra. Santa María concessionaire del Páramo. León Autopistas de Puerto Montellano, sector embalse. Infrastructures Rico y Compañía, S.E. San José (Puerto Rico) concessionaire Other auditors 1,099 75.00 — (APR) Autopista Trados-45, Ctra. M-203 P.K. 0,280. Infrastructures PwC 27,648 50.00 S.A. (TRADOS-45) Madrid concessionaire Concesionaria Vial Carrera novena, 126-91. Infrastructures de los Andes, S.A. Santafé de Bogotá concessionaire Other auditors 8,602 39.04 (COVIANDES) (Colombia) — — Pt Operational Services 1 Lavender Road. Limited (PTY) Bon Accord 009. Operation and maintenance Other auditors 0 33.30 — Pretoria (South Africa) Autopistas del Sol, Leandro N. Alem, 986, Toll highway S.A. (AUSOL) piso 4. Buenos Aires concessionaire (Argentina) Sociedad Concesionaria Av. Andrés Bello, 2777 -Las Toll highway del Elqui, S.A. (ELQUI) Condes- Santiago (Chile) concessionaire Concesiones de Av. Europa, 18. Madrid, S.A. (CONCEMA) Alcobendas. Madrid Infrastructures concessionaire PwC/ Other auditors Other auditors Other auditors 43,585 31.59 — 72,308 25.00 28,798 25.00 — — — Infraestructuras Golfo de Salónica, 27. Administration and Other 8,228 22.50(3) y Radiales, S.A. (IRASA) Madrid management of infrastructures auditors * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. — — — — — — — — — — — — — Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 105 Subsidiary and associated companies (thousand euros) Company Registered office Activity Brisa, Auto-estradas Quinta da Torre da de Portugal, S.A. (4) Aguilha, Edificio Toll highway concessionaire Auditors Other auditors Brisa, 2785-589. São Domingos de Rana (Portugal) Share capital % Shareholding direct Company owning indirect indirect shareholding 600,000(5) — 10.00 Autopistas- Conces. Espanhola, SGPS Acesa Italia, S.R.L. Via delle Quattro Holding company PwC 166,341(6) — 100.00 acesa Fontane, 15. Rome (Italy) of concessionaires Schemaventotto, S.p.A. Calmaggiore, 23. Holding company Other 445,536 — 13.33 Treviso (Italy) of concessionaires auditors Acesa Italia Autostrade, S.p.A. (7) Via A. Bergamini, 50. Toll highway Other 571,712(5) — 6.95 Schemaventotto Rome (Italy) concessionaire auditors Túnel del Cadí, S.A.C. Carretera de Vallvidrera Toll highway a St. Cugat, km 5,3. concessionaire Barcelona Other auditors 105,504 — 37.19 acesa Autopista Terrassa- Autopista C-16, km 41. Toll highway PwC 69,411 — 23.72 acesa Manresa, Autema, Barcelona concessionaire Concessionària de la Generalitat de Catalunya, S.A. (AUTEMA) Ciralsa, S.A.C.E. Av. Maisonnave, 41. Construction, — 50,167 — 25.00 aumar Alicante maintenance and operation of toll highways Iberacesa, S.L. Caleruega, 102-104. Holding company — 32,229 — 100.00 iberpistas Madrid of concessionaires Ingeniería y Sistemas Pío Baroja, 6. Madrid Technical — 61 — 100.00 Iberacesa de Gestión de Autopistas, S.A. (ISGASA) engineering services Alazor Inversiones, S.A. Rozabella, 6. Las Rozas. Holding company Other 199,000 23.34 Iberacesa Madrid of concessionaires auditors Accesos de Madrid, Rozabella, 6. Las Rozas. Toll highway C.E.S.A. Madrid concessionaire Other auditors 199,000 — 23.34 Alazor Inversiones Tacel Inversiones, S.A. Hórreo, 11. Santiago Holding company Other 32,250 — 18.00 Iberacesa de Compostela of concessionaires auditors Autopista Central Gallega, C.E.S.A. (ACEGA) de Compostela Hórreo, 11. Santiago Toll highway concessionaire Other auditors 32,250 — 18.00 Tacel Inversiones * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. 106 5. Financial information - 5.1. Consolidated Annual Accounts Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Ibermadrid de Pío Baroja, 6. Madrid Study, development — Share capital 500 Infraestructuras, S.A. and construction of civil works infrastructures % Shareholding direct Company owning indirect indirect shareholding 100.00 Iberpistas Proconex, S.A. Pío Baroja, 6. Madrid Operation — 100 100.00 iberpistas of sub-leased service areas Road Management 130 High Street Old Group (RMG) Woking, Surrey (United Kingdom) Toll highway concessionaire Other auditors 35,931 25.00 Aurea Limited Gestora de Autopistas, Andrés Bello, 2777. Toll highway PwC 1,058 51.00 Promoción de S.A. (GESA) Las Condes- Santiago concessionaire (Chile) M-45 Conservación, S.A. Ctra. M-203 P.K. 0,280. Conservation — 553 — 37.50 Madrid and maintenance of infrastructures Autopistas Chile Limitada Trados45/ Concema Autopista del Henares, Golfo de Salónica, 27. Toll highway S.A.C.E. (HENARSA) Madrid concessionaire Other auditors 96,700 — 22.50 Infraestructuras y Radiales Erredosa Golfo de Salónica, 27. Administration Other 61 — 22.50 Infraestructuras Infraestructuras, S.A. Madrid and management auditors y Radiales (ERREDOSA) Car Parks infrastructures Las Mercedes Sociedad Las Mercedes, s/n. Car park operator — 611 — 33.33 saba Concesionaria, S.L. Las Arenas-Getxo Vizcaya Parcheggi Bicocca Via Gaetano Negri, 10. Car park operator — 1,500 — 14.89 Saba Italia Milan (Italy) Port Mobility Località Porto del Turco, 53. Car park operator — 1,500 — 5.96 Saba Italia Civitavecchia. Rome (Italy) Logistic services Araba Logística, S.A. Olaguibel, 2. Vitoria (ARASUR) PwC 6,408 — 39.77 Construction and operation of logistic areas Centro Intermodal Av. Ports d’Europa, 100. Promotion de Logística, S.A. Barcelona (CILSA) and operation of logistic areas Other auditors 15,467 — 32.00 abertis logística abertis logística * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 107 Subsidiary and associated companies (thousand euros) Company Registered office Activity Auditors Share capital Telecommunications % Shareholding direct Company owning indirect indirect shareholding Adquisición de Motors, 392. L’Hospitalet Inactive — 3 100.00 tradia Emplazamientos, S.L. de Llobregat. Barcelona (ADESAL) Torre de Collserola, S.A. Ctra. de Vallvidrera Construction a Tibidabo, s/n. Barcelona and operation Other auditors 12,020 — 41.75 retevisión of telecommunication infrastructures Airports TBI, plc (8) 159 New Bond Street London W1S 2UD (United Kingdom) Operation of airports PwC 81,388 — 26.28 ACDL Foreign currency amounts converted to euro using exchange rate at close. (1) The shares of GCO are traded on the Argentina Stock Exchange. The average weighted price in the last quarter of 2004 was 1.36 Argentine pesos. At year-end the share price was 1.66 Argentine pesos. 57.6% of the voting rights are held. (2) The shares of Avasa are pledged by virtue of the share pledge agreement dated 2/8/2001 as guarantee on a loan. (3) Direct shareholding of abertis 15%. Indirect holding through iberpistas and Avasa of 7.5%. (4) The shares of Brisa, Auto-estradas de Portugal, S.A. are traded on the Lisbon Stock Exchange. The average weighted price in the last quarter of 2004 was 6.47 euros. At year-end the price was 6.75 euros. (5) Information at 30 June 2004. (6) Information at 31 December 2003. (7) The shares of Autostrade, S.p.A. are traded on the Milan Stock Exchange. The average weighted price in the last quarter of 2004 was 17.907 euros. At year-end the price was 19.70 euros. (8) Group that was listed on the London Stock Exchange until its acquisition by ACDL. This group is made up of various companies in different countries and operates (under concession or ownership) in eight international airports (Europe, United States and Latin America) and manages fully or partially, on behalf of governments or local authorities, another six airports. * This annex forms an integral part of Note 2 to the 2004 Consolidated Annual Accounts, with which it should be read. 108 5. Financial information - 5.1. Consolidated Annual Accounts ABERTIS INFRAESTRUCTURAS, S.A. Consolidated Management Report for 2004 The 2004 financial year represents another step forward in the process of growth and consolidation for the abertis Group as one of the leading managers of mobility and communications infrastructures operating in highways, car parks, logistic infrastructures, telecommunication infrastructures and airports. As head of an important business group, the objective of abertis is to continue offering its shareholders a balanced combination of investments in the sectors mentioned above that ensure an adequate combination of low risk, growth and yield. In this respect, the following events in 2004 should be highlighted: • • • • • In the highways sector, the award of the Alicante Ring Road tender to a consortium in which abertis holds 25%, the start of operations of Radial 3 and 5 in Madrid (23% share held by abertis), the acquisition of 0.5% shareholding in Schemaventotto (company that groups the core shareholders of Autostrade) and the capital gains on the sale by Schemaventotto of 10% of Autostrade and the sale by Autostrade of 5% of abertis. With the objective of rationalising the ownership structure of the Group the operations of abertis and iberpistas (100% owned) have been merged. In the car parks sector, during the year saba has reached an important agreement on a new fee model with the Barcelona City Council, along with an investment plan to improve the car parks and an extension of the concessions. It has commenced its expansion in Chile with the acquisition of 6 car parks and has embarked on the construction of new car parks in Italy, one of the two main axes, together with Portugal, of its international expansion until entering Latin America. In the logistic infrastructures sector, development of the logistics projects at Alava, Seville and ZAL Prat, in which abertis is a shareholder, continues according to plan and the Logistics Park of Zona Franca and ZAL Barcelona are fully occupied. In the telecommunication infrastructures sector, the inclusion of Retevisión Audiovisual in the accounts for 2004 should be noted, having been acquired at the end of 2003, as well as the increase in the shareholding in Torre de Collserola to become the main shareholder with 41.75%. Lastly, in the airport sector the company ACDL was incorporated at the end of the year and presented a Public Takeover Offer for the British airport operator TBI, which was successfully completed in 2005 by taking 100% control. At the end of 2004, investment totalled 204.2 million euros for the acquisition of 29% of TBI, which has been consolidated by equity accounting. Annual Report 2004 5. Financial information - 5.1. Consolidated Annual Accounts 109 All these actions, combined with the positive performance of the other businesses and activities, have had a positive impact on the key figures and results for the year. The 2004 consolidated profit and loss account of abertis is not comparable with the previous year due to the abovementioned consolidation of retevisión during its first full year of activity within the Group. The profit for the year was 467 million euros, which represents an increase of 32% on the previous year (11.8% if we exclude the effect of the extraordinary capital gains of 70 million euros obtained from the Italian associated companies). Operating income rose to 1,534 million euros (20% more than 2003). The highways sector contributed 74% of total income, car parks 6%, telecommunication infrastructures 17%, with logistic infrastructures and airports generating the remaining 3%. The evolution of the activity has been positive in the main concessionaires of the Group as the evolution of Average Daily Traffic (ADT) indicates, rising by 3.4% across all the highways operated by abertis in Spain to 28,283 vehicles. The balance sheet clearly reflects the effect of the new investments and the organic growth recorded by the companies that make up abertis. Total assets rose from 9,685 million euros at 31 December 2003 to 9,940 million euros at the end of 2004 whilst consolidated equity was 3,318 million euros, 7% more than the previous year. Debt at 31 December 2004 (3,521 million euros) represents 106% of equity and 35% of total liabilities, percentages below those of other large European operators of communication infrastructures. During 2004 the financial structure of the Group has been optimised, centralising the debt in abertis, which is responsible for covering the funding requirements of the subsidiary companies. In addition, there has been an important transfer of short-term debt to long-term debt, enabled to a large extent by the bond issues made in November 2004, in which abertis concluded a private debt placement of long-term bonds on the US market valued at 600 million dollars (the largest placement in the US Private Placement market made by a Spanish company during the year) and in February 2004, when abertis made a bond issue to institutional investors, also in the international market under Spanish law and documentation, of 450 million euros. The financial equilibrium of abertis has allowed it to face the new investments into improving the infrastructures currently under management with guarantees, and continue with the selective investment policy developed in recent years without the need for additional capital contributions. As in previous years, abertis has maintained its policy of shareholder return that combines the dividend payout with a bonus share issue of one share for every 20 shares held. The Board of Directors of abertis has agreed to propose to the Ordinary Shareholders’ Meeting a final dividend for 2004 of 0.25 euros gross per share, which represents an increase of 12.1% on the final dividend of the previous year, an indication of the confidence in the consolidation of the return on investments made in recent years and their growing contribution to profits. 110 5. Financial information - 5.1. Consolidated Annual Accounts The total dividend charged against results for 2004 will be 264 million euros, including the interim dividend already paid, representing an increase of 11.3% on the dividend payout of the previous year. In 2005 it is expected that the positive contribution of all business units will continue, accentuated by the progressive contribution of all new projects and the most recent incorporations in the Group, with the policy on shareholder return being maintained. As a listed Group, abertis will have to adopt international accounting standards as from 2005. Consequently, it is currently analysing the impact that the new international accounting standards (IAS) will have on the consolidated financial statements of abertis, which may be affected by the specific interpretation of the IAS on the concessionaires sector, being analysed and studied by the international regulatory bodies at the time of preparing these annual accounts. The Company has not traded, directly or indirectly, in its own shares, with the exception of the acquisition of 111,601 shares in the context of the merger with iberpistas. Due to the small number of shares required for the share swap (0.16% of the share capital of iberpistas), the issue of new abertis shares to exchange with the shareholders of iberpistas was substituted, on prior approval of the Shareholders’ Meeting, by the acquisition of treasury stock that were subsequently exchanged with the minority shareholders. Consolidated Auditor's Report 114 5. Financial information - 5.2. Parent Company Accounts Balance sheet at 31 December (thousand euros) ASSETS Fixed assets Start-up costs Intangible fixed assets Computer applications Goodwill Studies and projects Other intangible assets Amortisations Tangible fixed assets Land and natural resources Buildings and other constructions Machinery and vehicles Installations, tooling and furniture Other fixed assets Depreciation Investments Shareholdings in subsidary and associated companies Long-term loans to Group companies Long-term share portfolio Long-term deposits and guarantees Other credits Provisions Deferred expenses Current assets Accounts receivable Advance payments to creditors Group company accounts receivable Sundry accounts receivable Personnel Public Administration Provisions 2004 2003 5,583,787 4,777,874 — 349,121 296 370,438 947 3 (22,563) 14,033 3,015 7,511 349 3,405 3,197 (3,444) 26 5,828 218 7,823 770 3 (2,986) 15,299 3,038 8,311 492 4,167 3,197 (3,906) 5,220,633 4,756,721 4,080,016 1,376,804 7,513 62 6,613 (250,375) 4,264,271 700,802 7,513 65 6,616 (222,546) 7,286 9,173 414,529 587,854 11,448 23 2,192 10,342 10 1,632 (2,751) 9,219 12 4,703 5,528 4 1,662 (2,690) Short-term investments 399,226 575,346 Short-term loans to Group companies Short-term share portfolio Other credits Treasury Cash Banks and credit institutions Total assets 372,127 1,325 25,774 3,855 39 3,816 575,346 — — 3,289 41 3,248 6,005,602 5,374,901 Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 115 Balance sheet at 31 December (thousand euros) LIABILITIES Equity Share capital Share premium Reserves Revaluation reserve RDL 7/1996 Legal reserve RD 1564/1989 Voluntary reserve Profit and loss account Interim dividend paid during year Provisions for liabilities and expenses Other provisions Long-term liabilities Bond issues Loans with credit institutions Payments pending on shares of Group companies Loans with subsidiary and associated companies Other creditors Current liabilities Bond issues Bonds Interest on bonds Loans with credit institutions Loans Interest on loans Loans with Group companies Trade creditors Creditors for traffic operations Other non-trade creditors Public Administrations Remuneration pending payment Other creditors Guarantees and deposits received 2004 2003 3,186,622 3,068,960 1,654,444 1,575,661 579,690 579,690 717,701 704,867 400,712 191,570 125,419 361,076 479,495 158,668 66,704 329,017 (126,289) (120,275) 41,397 41,397 40,529 40,529 2,157,993 1,369,159 870,000 590,000 801,000 763,765 2,227 482,255 2,511 3,353 9,530 2,511 619,590 896,253 193,685 170,000 23,685 323,933 318,600 5,333 42,205 4,203 4,203 55,564 53,790 1,253 509 12 4,768 — 4,768 818,117 812,340 5,777 17,242 3,065 3,065 53,061 51,409 800 847 5 Total liabilities 6,005,602 5,374,901 116 5. Financial information - 5.2. Parent Company Accounts Profit and loss account for the year ended 31 December (thousand euros) EXPENSES Personnel expenses Salaries and wages Social security Pension fund and other personnel-related expenses Amortisation and depreciation of fixed assets Movement in trading provisions Other operating expenses External services Taxes 2004 12,157 11,055 870 232 20,274 146 16,898 16,814 84 2003 13,638 12,414 929 295 2,826 454 15,634 14,997 637 Total operating expenses 49,475 32,552 Financial costs, related expenses and variation in investment provision Total financial expenses Positive financial results Profit on ordinary activities Losses on disposal of fixed assets and extraordinary expenses 92,529 92,529 71,781 71,781 416,872 332,128 382,645 317,965 25,996 5 Movement in fixed asset provisions 31,765 26,989 Profit before tax Corporate income tax Profit for the year 340,419 309,715 (20,657) (19,302) 361,076 329,017 Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 117 INCOME Operating revenue Services Other operating expenses Other operating expenses Work done on fixed assets Total operating income Operating loss Income from shareholdings in Group and associated companies 2004 14,704 14,704 2003 15,748 15,748 544 544 — 2,641 2,641 — 15,248 18,389 34,227 14,163 464,702 368,837 Other interest and related income 44,699 35,072 Total financial income 509,401 403,909 Profit from the disposal of fixed assets and extraordinary income 15,535 18,744 Extraordinary loss 42,226 8,250 118 5. Financial information - 5.2. Parent Company Accounts ABERTIS INFRAESTRUCTURAS, S.A. NOTES TO THE 2004 ANNUAL ACCOUNTS Note 1. Activity a) Activity ABERTIS INFRAESTRUCTURAS, S.A. (hereinafter abertis or the Company) was incorporated in Barcelona on 24 February 1967. On 29 June 2002, the General Shareholders’ Meeting of the Company agreed to make a non-monetary transfer of the concessionary activity, as well as various shareholdings in other highway concessionary companies, to Autopistas II (now Autopistas Concesionaria Española, S.A.) On 8 April 2003, the Extraordinary Shareholders’ Meetings of ACESA Infraestructuras, S.A. and AUREA, Concesiones de Infraestructuras, S.A. (AUREA) approved the merger, whereby the former company would take over the latter, effective for accounting purposes as from 1 January 2003, the date from which it is understood that the operations of AUREA were conducted on account of the Company. On 30 May 2003 (registration date for deed of merger with AUREA) it changed its name from ACESA INFRAESTRUCTURAS, S.A. to its current name. Its registered office is Avenida del Parc Logistic nº 12-20, Barcelona. abertis is currently the parent of a group engaged in the management of infrastructures serving mobility and communications that operates in five sectors of activity: highway concessions, car parks, logistic services, telecommunications and airports. Its corporate purpose is defined as the construction, maintenance and operation of highways under concession; management of highway concessions in Spain and internationally; construction of road infrastructures; complementary activities to the construction, maintenance and operation of highways, such as service stations, integrated centres for logistics and/or transport and/or parking, as well as any other activity related with infrastructures for transport and communication and/or telecommunication serving the mobility and transportation of people, goods and information, under the necessary authorisation, when applicable. The Company can undertake its corporate purpose, especially the concessionary activity, directly or indirectly through shareholdings in other companies, being subject at all times, in this respect, to the provisions of the law in force. b) Merger On 27 April 2004 and 26 April 2004, the General Shareholders’ Meetings of Abertis Infraestructuras, S.A. and Ibérica de Autopistas, S.A. approved the merger, whereby the former company took over the latter, effective as from 1 January 2004 for accounting purposes, from which date the operations of Ibérica de Autopistas, S.A. were understood to be made on account of the Company. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 119 As the shareholding of abertis in the capital of Ibérica de Autopistas, S.A. was 99.84%, it was not considered necessary to make a specific capital increase to cover the exchange of shares in Ibérica de Autopistas, S.A. for shares in abertis. To acquire the 0.16% shares outstanding, abertis proceeded to purchase the necessary treasury stock to swap with the shareholders of Ibérica de Autopistas, S.A. at the established rate of 1 share in Ibérica de Autopistas, S.A. for 1 share of abertis. The audited balance sheet of Ibérica de Autopistas, S.A at 31 December 2003, which has been included in the balance sheet of the Company, is as follows: Assets Net fixed assets Intangible fixed assets Tangible fixed assets Investments Deferred expenses Current assets Liabilities Equity Long-term creditors Short-term creditors 53 1,885 505,809 Thousand euros 507,747 1,272 22,305 531,324 Thousand euros 248,970 234,118 48,236 531,324 In the tables and movements shown in these notes to the accounts, the column “Incorporation on merger” indicates the balances included as from 1 January 2004. 120 5. Financial information - 5.2. Parent Company Accounts Note 2. Basis of presentation of Annual Accounts a) Accounting principles The Annual Accounts are obtained from the accounting records of the Company and have been prepared according to the generally accepted accounting principles in Spain and established in the current legislation. The figures contained in the balance sheet, profit and loss account and the notes to these accounts are expressed in thousands euros. The Consolidated Annual Accounts for the abertis Group for 2004 are presented separately from the parent company’s accounts. The main figures taken from the audited consolidated accounts are as follows: Total assets Equity Consolidated operating income Result for the year due to the parent company – Profit b) Comparison of information 9,940,022 3,317,694 1,534,009 467,291 The Annual Accounts for 2004 are not comparable with those for 2003 as the 2004 accounts reflect an increased level of activity due to the merger mentioned in Note 1 b). Note 3. Proposed distribution of results The following distribution of results will be submitted to the Annual Shareholders’ Meeting for approval: Basis of distribution Profit for the year Distribution Dividends Legal reserve Voluntary reserve Amount 361,076 264,159 36,108 60,809 361,076 Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 121 During 2004 an interim dividend of 126,289 thousand euros was paid. This interim dividend represented a gross amount of 0.229 euros per share on all issued shares. The table below shows that there was sufficient profit in the period to cover the payment of the interim dividend (which was made in October 2004), with the accounting statement verifying sufficient liquidity to make the payment. Net profit from 1 January to 31 July 2004 Less: Legal reserve Maximum amount available for distribution Amount proposed and distributed Cash funds available prior to payment Gross amount of interim dividend Cash funds available after payment Note 4. Accounting policies Amount 140,718 (14,072) 126,646 126,289 Amount 829,618 (126,289) 703,329 The most significant accounting policies used in the preparation of these Annual Accounts are as follows: a) Start-up costs Incorporation expenses and share capital increase expenses are recorded at cost, shown net of accumulated amortisation, which is calculated using the straight-line method over a period of five years. 122 5. Financial information - 5.2. Parent Company Accounts b) Intangible fixed assets The items included under this heading are valued at acquisition price or the cost of production and amortised as follows: • Goodwill is amortised on a straight-line basis over the estimated period in which it will contribute to profit generation, up to a maximum period of 20 years. • Computer applications are amortised at a rate between 25% and 33% per annum. c) Tangible fixed assets Tangible fixed assets are valued at acquisition cost, revalued in accordance with various legal measures. Costs of refurbishment, enlargement or improving tangible fixed assets are capitalised only when they increase capacity, productivity or extend the useful life of the asset, provided that it is possible to know or estimate the net book value of the assets which are written off after being replaced. The costs of repair and maintenance are charged to the profit and loss account in the year in which they are incurred. The depreciation of tangible fixed assets is calculated systematically using the straight-line method, based on the estimated useful life of the assets, taking into consideration wear and tear derived from normal use. The depreciation rates used to calculate the decline in the value of the fixed assets are as follows: Buildings and other constructions Machinery and vehicles Tooling Other installations Furniture Computer equipment Other fixed assets Rate 2–8% 6–30% 7–37.5% 7–20% 10–20% 20–37.5% 3–30% Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 123 d) Financial assets and investments Investments in Group and associated companies and long-term securities are shown in the balance sheet at the lower of acquisition cost or market value. The market price for investments in Group or associated companies, or other traded securities that are not publicly listed is calculated as the book value, plus the acquisition goodwill remaining at the balance date. The difference between the acquisition cost and the net book value of the subsidiary and associated companies at the time of acquisition is recorded as goodwill, which is amortised over a maximum period of twenty years, or in the case of highways or other types of concessions, over the remaining life of the concession, given that this is the most appropriate period for generating the resources required to recover the goodwill, to the extent that the recovery is not realised through increases in the book value of the subsidiary and associated companies. The Company undertakes currency hedges against exchange rate risks on investments using the necessary financial instruments (see Note 4.e). e) Deferred expenses The expenses for raising loans is amortised on a straight-line basis over the period of the loans. Also included in this entry is the sum corresponding to expenses arising from the hedging operations contracted in 2000 related to the acquisition of 48.6% of Grupo Concesionario del Oeste, S.A. (GCO) for an amount of 120.6 million dollars (exchange rate hedge contracts on the Argentine peso/US dollar and US dollar/Euro). These expenses are recorded monthly over the 60-month period of the hedge. The exchange rate differences that arise in the conversion of said operations to euros will be recorded on the cancellation or final settlement of the hedge contracts. With the decision to transfer the investment in GCO to the subsidiary company ACESA, abertis has agreed to transfer the hedges when they are cancelled or on their final settlement (October 2005). f) Other provisions Pursuant to the prudence principle, the Company makes the provisions which it considers necessary in relation to the inherent risks in the business that could affect the company (see Note 11). g) Pension commitments and other personnel-related liabilities Meeting the corresponding employment agreements, the Company has obligations to contribute to an employment system Pension Plan (Defined Contribution Plan) and, in respect of certain employees, it must pay a retirement bonus or lump sum, under certain conditions. These commitments are externalised through an insurance policy. 124 5. Financial information - 5.2. Parent Company Accounts h) Trade and non-trade debtors and creditors The debits and credits incurred in operations, whether or not produced in the ordinary course of business, are recorded at nominal value, making the necessary valuation adjustments to cover bad debt provisions. Amounts due within one year of balance date are classified as short-term and amounts due after this date are considered long-term. i) Corporate Income Tax The profit and loss account includes the charge for Corporate Income Tax, the calculation of which incorporates the full amount of tax accrued for the year, the effect of timing differences between the tax profit and book profit, and all credits or allowances to which the Company is entitled. The Corporate Income Tax charge is calculated as explained in Note 14. The Company pays tax on a consolidated basis together with other Group companies, in accordance with the legislation in force. j) Foreign exchange differences Transactions in currencies other than the euro are recorded at the exchange rate on the transaction date. At the close of the financial year the company restates all foreign exchange credits and debits using the official exchange rate in effect at that date. Negative exchange differences generated at year end on transactions are recorded as a loss in the profit and loss account, while exchange gains are deferred until maturity. See exchange rate hedging transactions in Note 4.e). k) Accounting for income and expenses Income and expenses are recorded on an accruals basis, that is, at the time the activity occurs, irrespective of when the financial transaction takes place. l) Actions affecting the environment Amounts outlaid annually in meeting legal requirements related to the environment are recorded either as an expense or investment, depending on their nature. Amounts recorded as investments are depreciated over their useful life. No provision has been made for liabilities and expenses related to the environment, given that no contingencies exist with respect to environmental protection. m) Joint ventures To account for operations undertaken as Joint Ventures, both in the balance sheet and the profit and loss account, the method of proportional integration has been used, in accordance with the General Accounting Plan. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 125 Note 5. Intangible fixed assets The movement during 2004 and balances of the accounts that make up intangible fixed assets were as follows: Balance 31.12.03 Incorporation on merger Increase Decrease Balance 31.12.04 Computer applications Goodwill Studies and projects Other intangible assets 218 7,823 770 3 78 362,615 — — Total cost 8,814 362,693 78 — 177 — 255 (78) 296 — — — 370,438 947 3 (78) 371,684 Goodwill is generated by the existing difference between the value of the investment that the Company held in Ibérica de Autopistas, S.A and the value of the consolidated shareholders’ funds of this company on the effective date of the merger, 1 January 2004. The changes in accumulated amortisation during the year were as follows: Balance 31.12.03 Incorporation on merger Increase Decrease Computer applications Goodwill Studies and projects Other intangible assets Total amortisation 21 2,963 — 2 2,986 25 — — — 25 72 18,557 947 1 (25) — — — 19,577 (25) 22,563 Balance 31.12.04 93 21,520 947 3 126 5. Financial information - 5.2. Parent Company Accounts Note 6. Tangible fixed assets The movement and balances of tangible fixed assets were as follows: Balance 31.12.03 Incorporation on merger Increase Decrease Balance 31.12.04 Land and natural resources Buildings and other constructions Machinery and vehicles Tooling Other installations Furniture Computer equipment Other fixed assets Total 3,038 8,311 492 11 3,295 861 247 2,950 19,205 471 2,066 69 — — 286 95 — 2,987 — 15 — — 5 1 — — 21 (494) (2,881) (212) (10) (679) (365) (95) — 3,015 7,511 349 1 2,621 783 247 2,950 (4,736) 17,477 The changes in accumulated depreciation during the year are as follows: Balance 31.12.03 Incorporation on merger Increase Decrease Buildings and other constructions 1,056 Machinery and vehicles Tooling Other installations Furniture Computer equipment 274 10 1,914 508 144 810 38 — — 199 55 Total 3,906 1,102 126 59 1 184 55 49 474 Balance 31.12.04 1,040 222 1 1,475 513 193 (952) (149) (10) (623) (249) (55) (2,038) 3,444 The most significant decreases during the year correspond basically to the sale at net book value of the assets transferred as a result of the merger indicated in Note 1.b) to the subsidiary Autopistas, A-6 (now Iberpistas, S.A.C.E). Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 127 The following assets are fully depreciated: Buildings and other constructions Machinery and vehicles Furniture Computer equipment Other fixed assets Total gross book value Amount 2 28 585 307 55 977 It is Company policy to contract all the insurance policies considered necessary to cover all possible risks that could affect tangible fixed assets. Note 7. Investments The movements and balances of investments are as follows: Shareholdings in subsidiary and associated companies Long-term loans to Group companies Long-term share portfolio Long-term deposits and guarantees Other credits Balance Incorporation on merger 31.12.03 Increase Decrease Transfers Balance 31.12.04 4,264,271 (122,892) 217,991 (279,354) — 4,080,016 700,802 605 1,030,904 (187,579) (167,928) 1,376,804 7,513 3,505 65 6,616 1 — — — — (3,505) (4) (3) — — — 7,513 62 6,613 Less: Provisions (222,546) (7,731) (34,216) 14,118 — (250,375) Total 4,756,721 (126,512) 1,214,679 (456,327) (167,928) 5,220,633 128 5. Financial information - 5.2. Parent Company Accounts a) Shareholdings in subsidiary and associated companies The detail of the direct and indirect shareholdings in Group subsidiary and associated companies, together with the breakdown of their shareholders’ funds at 31 December 2004 or of the latest public information available, is shown in the Annex. The main movements recorded were:: • • • • Incorporation, as a result of the merger with Ibérica de Autopistas, S.A., of the direct shareholdings in the companies Iberpistas, S.A.C.E. (formerly A-6), Castellana de Autopistas, S.A.U.C.E. (castellana), Iberavasa de Inversiones S.L.U. (Iberavasa), Iberacesa S.L.U., Ibermadrid de Infraestructuras, S.A., Promoción, Conservación y Explotación de Servicios de Autopistas, S.A.U. (Proconex), Promoción de Autopistas de Chile Limitada (Iberpistas Chile) and Sociedad Concesionaria del Elqui, S.A. (Elqui). Incorporation of Airport Concessions Development Limited (ACDL), in which abertis holds 90%, for a sum of 204,224 thousand euros to cover the acquisition of TBI, plc. On 24 November 2004, ACDL launched a public takeover offer for all the shares of TBI. At 31 December 2004, ACDL had acquired 29.2% of TBI and in January 2005 the Public Takeover Offer was completed securing 100% of the share capital. Increase of capital of abertis logística and Irasa by 9,998 and 1,718 thousand euros, respectively. Inclusion of Abertis Infraestructuras Finance BV for the sum of 2,000 thousand euros. • Sale by Iberpistas, S.A.C.E (formerly A-6) of the shareholdings in castellana, Iberavasa, Iberacesa, Ibermadrid and Proconex for their net book value at 31 December 2003 (278,228 thousand euros), with payment being made through the subrogation of long term loans with credit institutions and other debts. • Decrease in the value of the investment in Trados 45 as a result of the reduction in capital of 1,126 thousand euros (the shareholding remains at 50%). The provisions basically correspond to the Argentine company Ausol and the Colombian company Codad, 147.548 and 45.751 thousand euros respectively (100% of the value of the holdings in both companies is provisioned) and abertis telecom, 44.207 thousand euros. During 2004 the provisions of the subsidiary companies on the balance sheet of Ibérica de Autopistas, S.A at 31 December 2003 have been reversed, and included in the Company’s balance sheet through the merger, as well as part of the provision made for abertis telecom. The allocation made during the year basically corresponds to Codad. abertis does not have any other commitments in relation to subsidiary and associated companies other than the financial investment made, with the exception of that set out in Note 18.b and in the Annex. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 129 b) Long-term loans to Group companies The long-term loans with Group companies have the following maturities: Loans to Group companies 115,000 564,658 65,000 315,000 317,146 1,376,804 2006 2007 2008 2009 Other mat. Total All loans accrue interest at market rates (see Note 13). Note 8. Deferred expenses The changes in the accounts and balances of deferred expenses were as follows: Expenses in raising finance Other deferred expenses Total Balance 31.12.03 Incorporation on merger Increase Decrease — 9,173 9,173 1,272 — 1,272 3,355 — (1,272) (5,242) 3,355 (6,514) Balance 31.12.04 3,355 3,931 7,286 Note 9. Short-term investments The Company has credit lines with Group companies of 759,178 thousand euros with interest at market rates. The outstanding balance at 31 December 2004 was 372,127 thousand euros (see details in Note 13). The amount of “Other credits” corresponds to interim dividends declared by some of the subsidiary companies that are pending payment at 31 December 2004. 130 5. Financial information - 5.2. Parent Company Accounts Note 10. Equity The amount and movements in equity during 2004 were as follows: Balance 31.12.03 Distribution of result for year Increase in capital Other movements Balance 31.12.04 1,575,661 579,690 479,495 158,668 66,704 — — — 32,902 58,715 329,017 (329,017) (120,275) 120,275 3,068,960 (117,125) 78,783 — (78,783) — — — — — — — — — — 1,654,444 579,690 400,712 191,570 125,419 361,076 361,076 (126,289) (126,289) 234,787 3,186,622 Share capital Share premium Revaluation reserve Legal reserve RD 1564/1989 Voluntary reserves Result for the year Interim dividend Total a) Share capital The share capital of abertis is made up of 551,481,375 registered shares, with a par value of 3 euros each, fully subscribed and paid up. Of these, 514,445,009 shares are Class A and 37,036,366 are Class B preference shares that have the same rights as the ordinary shares and the right to a preferential dividend to be paid once to holders of those shares in 2007. The maximum amount of the preferential dividend corresponding to each preference share will be determined by the difference between the reference price of 14.87 euros per share and the average weighted price of the ordinary abertis shares in the quarter prior to the due date, with a maximum payment of 4.25 euros per share. As the shares of abertis are bearer shares, the exact percentage of shareholders in the share capital is not known. However, based on the information available, the most significant holdings at 31 December 2004 are the following: Caixa d’Estalvis i Pensions de Barcelona,”la Caixa” (1) ACS, Actividades de Construcción y Servicios, S.A. Caixa d’Estalvis de Catalunya Sitreba, S.L. 23.99% 17.58% 5.69% 5.50% 52.76% (1) Caixa Barcelona Seguros de Vida, S.A. de Seguros y Reaseguros (11.844%), VidaCaixa, S.A. de Seguros y Reaseguros (0.504%), Inversiones Autopistas, S.L. (7.753%) and CaixaHolding, S.A., Sociedad Unipersonal (3.890%). Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 131 All the shares of the Company are listed on the stock exchanges of Barcelona, Bilbao, Madrid and Valencia, being traded on the Spanish electronic trading system. The ordinary Class A shares are traded on the main board (continuous market) and form part of the Ibex 35 index. The Class B preference shares are traded under the Fixing mode, where single prices are set. In addition, options on the shares of the Company are traded on the options market of MEFF Renta Variable (Spanish Equities Futures Exchange). The Company’s Annual Shareholders’ Meeting on 27 April 2004, agreed to pay a final dividend for 2003 of 0.223 euros gross per share, which represents 117,125 thousand euros. At said Shareholders’ Meeting a bonus share issue was also approved, to be charged against the Revaluation Reserve Account, Royal Decree-law 7/1996, dated 7 June, with one new share for every 20 shares, representing a sum of 78,783 thousand euros. The Board of Directors was authorised by the Annual General Meeting of 8 April 2003 to increase share capital, through one or more capital issues, up to a maximum amount of 518,445 thousand euros, during the period up to 8 April 2008. This power remains fully operative. b) Revaluation Reserve Royal Decree-law 7/1996, of 7 June This reserve originates from the revaluation of the fixed assets in the balance sheet of the Company, by virtue of Article 5 of the above legislation. After three years have passed from the balance sheet date and the revaluation has not been questioned by the Tax Administration, the revaluation operations are deemed to be correct and the balance of the account to be accepted by the Tax Authorities, the balance will be available for distribution to: • Offset book losses. • Increase share capital. • Create reserves freely available for distribution, ten years from the date of the balance sheet stating the revaluation operations. The balance of this account cannot be distributed, directly or indirectly, unless the capital gain has been realised, with the understanding that this is the case when the revalued assets have been fully amortised, transferred or written off. Given the nature of the activity transferred of the subsidiary company ACESA in 2002, the requirement that the capital gain be realised can only be understood as such when the company acquiring the revalued assets as part of the new activity has amortised, transferred or written them off. 132 5. Financial information - 5.2. Parent Company Accounts c) Legal reserve In accordance with the Revised Text of the Spanish Companies Act, 10% of the annual profits must be allocated to the legal reserve so that this reserve reaches at least 20% of share capital. The legal reserve cannot be distributed to shareholders unless the Company is wound up. The legal reserve can be used to increase capital, provided the funds used come from the balance exceeding 10% of the capital that has been increased. Apart from the purpose mentioned above, as along as this reserve does not exceed 20% of share capital, it can only be used to offset losses when there are no other reserves available for this purpose. Note 11. Provisions for liabilities and expenses The movements in this account during the year ended 31 December 2004 were as follows: Other provisions (see Notes 4.f and 14) Balance 31.12.03 Increase Applications Balance 31.12.04 40,529 2,627 (1,759) 41,397 Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 133 Note 12. Bond issues and loans from credit institutions The table below details the situation at the close of 2004. 2005 2006 2007 2008 2009 Other mat. Total Bond issues 170,000 — — — 180,000 690,000 1,040,000 Syndicated loans — 2,500 101,000 17,500 20,000 50,000 191,000 Loans 45,000 150,000 40,000 10,000 30,000 380,000 655,000 Credit lines 273,600 — — — — — 273,600 Total 488,600 152,500 141,000 27,500 230,000 1,120,000 2,159,600 Part of the loan and credit operations shown as loans from credit institutions at 31 December 2004 (260,000 thousand euros long-term) were signed with related credit institutions (shareholders of the Company that held 5% or more of the capital). Financial charges accrued on these operations with related financial entities during the year totalled 6,453 thousand euros. The bond issues include 60,000 thousand euros at an annual interest rate of Euribor plus a margin of 0.45; 180,000 thousand euros at 3.53%; 200,000 at 4.95%; 450,000 at 4.75% and 150,000 at Euribor plus a margin of 0.22. The credit lines have a limit of 1,490,404 thousand euros of which 375,000 have an interest rate of Euribor plus 0.3 and 1,115,404 thousand euros at Libor plus 0.18. The Company has also contracted interest rate hedge operations for an amount of 1,265,000 thousand euros, of which 525,000 thousand euros are from credit entities related to the Company. Short-term loans are expected to be refinanced in 2005. 134 5. Financial information - 5.2. Parent Company Accounts Note 13. Transactions and balances with subsidiary and associated companies The credit and debit balances that abertis had with subsidiary and associated companies of the Group at 31 December 2004 were as follows: Thousand euros Debtors Creditors acesa Investments Long-term Short-term 566,802 105,321 Iberpistas, S.A.C.E. 196,146 137,882 retevisión aumar aucat tradia saba Iberacesa Abertis Infraestructuras Finance BV APR abertis telecom Sevisur serviabertis abertis logística Gco Others Total 181,000 180,000 128,856 95,000 29,000 — — — — — — — — — 1,676 41,020 29,550 12,134 6,982 14,288 — — 12,626 6,155 4,346 — — 147 Other debts 519 210 62 — — 24 115 — — — — — 13 11 989 249 Long-term Short-term — — — — — — — — 471,400 10,855 — — — — — — 71 32,643 118 — — 344 — 614 370 — 1,844 — 607 5,179 — 415 1,376,804 372,127 2,192 482,255 42,205 The long-term balances to pay to Abertis Infraestructuras Finance BV have the same maturities (between 2011 and 2024), interest rate and amount as the bonds issued in foreign currency by that subsidiary company. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 135 The provision of services by abertis to Group companies corresponds basically to corporate and management services, for the following amounts: Thousand euros acesa aumar Iberpistas, S.A.C.E. Codad retevisión saba aucat tradia abertis logística APR Coviandes Trados 45 Concema Others Total Income Expenses Interest received Services received Share capital 23,102 249,510 Services provided 5,139 3,562 1,522 727 640 594 544 244 107 102 — — — 6,354 1,278 — 5,733 336 3,479 2,534 12 — — — — 147,042 40,004 2,755 — 11,756 — — — — 5,932 3,533 1,210 2,960 Interest paid 1 576 417 — 1 — — — 16 — — — — 63 — — — — — — — — — — — — 145 1,512 13,326 44,340 464,702 3,650 3,713 370 1,381 136 5. Financial information - 5.2. Parent Company Accounts Note 14. Tax situation The Company calculates Corporate Income Tax on a consolidated basis, under Group No. 142/99, as parent company, together with those subsidiary companies that meet the requirements established in the tax regulations in force. The reconciliation of the difference between the reported pre-tax profit in the accounts and the profit subject to Corporate Income Tax for 2004 is as follows: Profit before tax Permanent differences Timing differences Arising during the year From previous years Tax assessment base (Thousand Euros) 340,419 (407,461) 7,447 69 (59,526) The accrued Corporate Income Tax expense stated on the profit and loss account is calculated taking into account the following factors, in addition to the parameters to be considered in the case of calculating tax for an individual company: • Dividends from consolidated subsidiary companies, the adjustment in values and the elimination of results for transactions between Group companies that have been eliminated to determine the consolidated tax payable are considered as permanent differences. • The consolidated tax Group has assumed the right to offset tax loss carry forwards generated by the Company in 2004, as well as the application of the deductions generated, with the corresponding inter-group offsetting of balances having being recorded in the balance sheet. • Taxes paid outside of Spain similar to Corporate Income Tax totalling 834 thousand euros have been recorded as an expense, as well as the adjustments in the calculation of the expense accrued in 2003, after having filed the respective returns totalling 4,722 thousand euros. The balance at 31 December 2004 of prepaid tax totalled 1,561 thousand euros (1,605 thousand euros to 31 December 2003), which corresponds to the valuation differences between the tax criteria and accounting criteria for social security contributions. The deferred tax balance at 31 December 2004 was 3,183 thousand euros (5,789 thousand euros at 31 December 2003), which arises from calculating the tax on forward operations on a cash basis, and the reversal of profit for Spanish companies that set up internationally, both arising in previous years. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 137 The amount of the deductions applied in 2004 is 2,740 thousand euros, for deductions related to dividends from associated companies not included in the consolidated Group for tax purposes, deductions for the reinvestment of extraordinary profits obtained in the transfer of equity, training expenses and other deductions. The amount of income covered by the deduction for reinvestment was 837 thousand euros, with the entire amount having been reinvested in different equity during 2004. On 9 June 2004 the agreement on the merger between Abertis Infraestructuras, S.A. through the full takeover of Ibérica de Autopistas, S.A. was made public and the resulting dissolution without liquidation of the latter (see Note 1.b). This operation was done under the special fiscal regime of Chapter VIII of Title VIII of the Corporate Tax Act, now Chapter VIII of Title VII of the Royal Decree Legislation 4/2004, dated 5 March, which approved the Revised Text of the Corporate Tax Act. As a consequence of the merger, the acquiring company takes over the entire equity of the merged company under universal title, as shown in the detail and information provided in Note 1.b to the Accounts, subrogating all the tributary rights and obligations conveyed in the goods and rights transferred. The assets and liabilities acquired have been included in the accounts of the acquiring company at book value and with the effects that are detailed in Notes 5 to 8 of this annual report. During 2002 and 2003 the Company was involved in various company transactions where it opted for the application of the special tax regime of Chapter VIII of Title VIII of the Corporate Tax Act, now Chapter VIII of Title VII of the Royal Decree Legislation 4/2004. The information on these transactions is provided in the annual reports for 2002 and 2003. These operations were as follows: • The non-monetary transfer of the branch of concession activity which the Company held for highway operations to Autopistas Concesionaria Española, S.A, Sociedad Unipersonal. • The increase of the Company’s share capital, to cover the share swap established in the Public Takeover Offer made by the Company for the shares in Ibérica de Autopistas, S.A. • The increase in share capital of the subsidiary company Abertis Logística, S.A., subscribed by the Company through the non-monetary transfer of shares in different subsidiary and associated companies. • The merger of the company Acesa Infraestructuras, S.A. through the complete takeover of Aurea, Concesiones de Infraestructuras, S.A., and the resulting winding up without liquidation of the latter. On 25 March 2004 notification was given to Abertis Infraestructuras, S.A. of the start of tax audits for the years 2000 to 2002. With respect to the Corporate Income Tax, the inspection was confined to Abertis Infraestructuras, S.A., both as representative of the Group 142/99, as well as taxable subject. After the close of the financial year, the Tax Administration has initiated various proceedings. 138 5. Financial information - 5.2. Parent Company Accounts In addition, the Company has been issued the corresponding tax assessments based on examinations made between 1989 and 1993 and for 2000, of a partial nature and under a consolidated fiscal regime, which the company has signed in disagreement. These assessments have been appealed and are pending the decision of the authorities. The eventual impact on the Company’s capital that could result, once the outcome of the appeal is known, is adequately provisioned. Nevertheless, the amount of tax that may be payable would not have a material impact on the Company’s Annual Accounts. Note 15. Income and expenses a) Income abertis, operates in five sectors of activity: highway concessions, car parks, logistics and services, telecommunications and airports, indirectly through its shareholdings in other companies, whereby its income corresponds basically to dividends and the provision of services to Group companies. b) Personnel The average size of the workforce during 2004 was: Permanent staff Temporary staff Total c) Extraordinary results 92 1 93 Include extraordinary expenses and extraordinary income related with the changes in provisions for shareholdings in subsidiary and associated companies (see Note 7). The extraordinary expenses also include the sum of 23,194 thousand euros corresponding to the difference arising from the recording of the merger with Ibérica de Autopistas, S.A (Note 1.b). Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 139 Note 16. Environment At 31 December 2004, abertis, as the parent company of the Group, has no significant assets allocated to the protection and improvement of the environment, nor has it incurred expenses of this nature during the year. Furthermore, it has not received any grants of an environmental nature during the year. Note 17. Other information on Board Members In accordance with the provisions of Article 127 ter. 4 of the Spanish Companies Act, pursuant to Law 26/2003, of 17 July, which amended The Securities Exchange Act 24/1988, of 28 July, and the Revised Text of the Spanish Companies Act, aimed at increasing the transparency of listed companies, the companies with the same, similar or complementary activity to Abertis Infraestructuras, S.A., in which members of the Board have shareholdings, as well as their functions, if applicable, are shown below. Those companies controlled by the abertis Group are excluded. Shareholder Company Activity Shareholding Functions ACS, Actividades de Construcción y Servicios, S.A. de los Andes Concesionaria Vial Dragados Concesiones de Infraestructuras, S.A. Dragados Concesiones de Infraestructuras, S.A. and subsidiary comapnies as listed Autovía de la Mancha, S.A. Bidelan Gipuzkoano Autobideak, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Sociedad Concesionaria Autopista Central, S.A. Infrastructures Concessionaire Aerocali, S.A. Ferrocarriles del Norte de Colombia, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Aeropuertos Mexicanos del Pacífico, S.A. de C.V. Infrastructures Concessionaire 0.96% 99.99% 66.67% 50.00% 48.00% 33.33% 71.32% 28.16% — — — — — — — — (continued on next page) 140 5. Financial information - 5.2. Parent Company Accounts (continued) Shareholder Company Activity Shareholding Functions Dragados Concesiones de Infraestructuras, S.A. MBJ Airports LTD Road Management A13 PLC Road Management Services (Darrington) Holding Ltd Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Bakwena Platinum Corridor Concesionaire Ltd Infrastructures Concessionaire Pt Operational Services Ltd Tag Reg, S.A. TP Ferro Concesionaria, S.A. Celtic Road Group Road Users Services Inversora de Infraestructuras, S.L. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Sociedad Concesionaria Infrastructures Vespucio Norte Express, S.A. Concessionaire Circunvalación de Alicante, S.A. Accesos de Madrid, C.E.S.A. Infrastructures Concessionaire Infrastructures Concessionaire Autopista Central Gallega, C.E.S.A. Infrastructures Concessionaire Autopista del Henares, C.E.S.A. Ruta de los Pantanos, S.A. Carmelton Group Ltd Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire 35.00% 25.00% 25.00% 25.00% 33.33% 50.00% 50.00% 3.33% 27.00% 99.99% 54.00% 50.00% 15.75% 13.32% 35.00% 25.00% 40.00% — — — — — — — — — — — — — — — — — (continued on next page) Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 141 (continued) Shareholder Company Activity Shareholding Functions Dragados Concesiones de Infraestructuras, S.A. Rutas del Pacífico, S.A. Infrastructures Concessionaire Desarrollo de Concesiones Ferroviarias, S.L. Infrastructures Concessionaire Guadalquivir Sociedad Infrastructures Concesionaria de la Junta de Concessionaire Andalucía Guadalmetro, S.A. Desarrollo de Concesiones Aeroportuarias, S.L. Infrastructures Concessionaire SCL Terminal Aeropuerto Santiago, S.A. Infrastructures Concessionaire Scutvias-Autostradas da Beira Interior, S.A. Autopistas del Sol, S.A. Caixa de Catalunya Túnel del Cadí Dragados, S.A. (previously Dragados Obras y Proyectos, S.A.) Retevisión Móvil, S.A. Ferrocarriles del Norte de Colombia, S.A. Aufe, S.A. Aunor, S.A. Concesionaria Vial del Sur, S.A. Autopistas del Sol, S.A. Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire Infrastructures Concessionaire 50.00% 99.99% 27.83% 99.99% 14.78% 26.65% 8.18% 3.55% 2.10% 5.32% 78.00% 85.00% 25.00% 6.40% — — — — — — — — — — — — — — Isidro Fainé Casas Telefónica, S.A. Communication 0.0001% Ángel García Altozano ACS, Actividades de Construcción y Servicios, S.A. Construction and Services 0.01% Deputy Chairman Corporate General Manager José Luis Olivas Martínez Acciona, S.A. Infrastructures Concessionaire 0.0008% — (continued on next page) 142 5. Financial information - 5.2. Parent Company Accounts (continued) Shareholder Company Activity Shareholding Functions José Luis Olivas Martínez Grupo Ferrovial, S.A. Infrastructures Concessionaire 0.0008% Telefónica, S.A. Telecommunications 0.0002% Ausur, Servicios de la Autopista, S.A. Logistics 5.00% Montes de Piedad y Caja de Ahorros de Ronda, Cádiz, Almería, Málaga y Antequera (Unicaja) — — — — — — — — — Board Member — — Deputy Chairman 15.00% 5.00% 10.00% 10.00% Infrastructures Autopista del Sol Concesionaria Española, S.A. Concessionaire Autopista del Sureste, Concesionaria Española de Autopistas, S.A. Infrastructures Concessionaire Inversora de Autopistas del Sur, S.L. Infrastructures Concessionaire Autopista Madrid Sur Infrastructures Concesionaria Española, S.A., Concessionaire Sociedad Unipersonal Autopista de la Costa Cálida Concesionaria Española de Autopistas, S.A. Infrastructures Concessionaire 4.50% Board Member Car Parks 24.50% — Logistics 10.28% Telecommunications 10.00% Sociedad Municipal de Aparcamientos y Servicios, S.A. Centro Integral de Mercancías, S.A. Red de Banda Ancha de Andalucía, S.A. Auna Operaciones de Telecomunicaciones, S.A. Telecommunications 2.21% Islalink, S.A. Telecommunications 13.70% Val de Telecomunicaciones, S.L. ACS, Actividades de Construcción y Servicios, S.A. Telecommunications 4.46% Construction 0.003% Pablo Vallbona Vadell Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 143 With respect to office or functions, in accordance with the above-mentioned legislation, set out below is a list of the Board Members that hold positions in companies with activities that are the same, similar or complementary to the corporate purpose of the Company. Companies controlled by the abertis Group have not been considered in this case, either. Shareholder Company Activity Position or function ACS, Actividades de Construcción y Servicios, S.A. Dragados, S.A. Construction Board Member ACS, Servicios, Comunicaciones y Energía, S.L. Construction and Services Board Member Salvador Alemany Mas ACS, Servicios y Concesiones, S.L. Centro Intermodal de Logística, S.A. Construction and Services Board Member Logistics Deputy Chairman Accesos de Madrid, Concesionaria Española, S.A. Highway Concessionaire Deputy Chairman Alazor Inversiones, S.A. Highway Concessionaire Board Member Autostrade, S.p.A Highway Concessionaire Board Member Autostrade per l’Italia, S.p.A Highway Concessionaire Board Member (until 5/11) Gilberto Benetton Autostrade, S.p.A Highway Concessionaire Board Member Isidro Fainé Casas Autostrade, S.p.A. Highway Concessionaire Board Member (until 15/10) Brisa, Auto-estradas de Portugal, S.A. Highway Concessionaire Board Member Ángel García Altozano ACS, Servicios, Comunicaciones y Energía, S.L. Construction and Services Board Member ACS, Servicios y Concesiones, S.L. Construction and Services Board Member Dragados Concesiones de Infraestructuras, S.A. Construction and Services Board Member Dragados, S.A. Construction Board Member ACS- Sonera Telefonía Móvil, S.L. Communication Xfera Móviles, S.A. Communication Broadnet Consorcio, S.A. Communication Chairman Chairman Chairman Vías y Construcciones, S.A. Construction Board Member (continued on next page) 144 5. Financial information - 5.2. Parent Company Accounts (continued) Shareholder Company Activity Position or function Cobra Instalaciones y Servicios, S.A. Construction and Services Board Member Telefónica Internacional Communication Board Member Miguel Ángel Gutiérrez Méndez Telefónica Argentina Communication Board Member Pablo Vallbona Vadell ACS, Actividades de Construcción y Servicios, S.A. Construction Deputy Chairman (non-Executive) Additionally, one of the main activities of the ACS Group is the promotion, management and operation of transport infrastructures. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 145 Note 18. Other information a) Annual remuneration of the directors for their service as members of the Board of Directors of the Company is fixed as a share in the net profits. Such remuneration can only be paid out once the payment of dividends and transfers to reserves required by law are covered and cannot exceed, under any circumstances, two percent of the profits. The Board of Directors may distribute this sum amongst its members in the form and amount it decides. Overall remuneration paid to Directors of Abertis Infraestructuras, S.A., as members of the Board of Directors, totalled 1,533 thousand euros in 2004, which is less than the statutory limit. Total remuneration received by the Board Members of Abertis Infraestructuras, S.A. was 2,014 thousand euros, which corresponds to fixed remuneration. In addition, other benefits that Board Members of Abertis Infraestructuras, S.A. have received contributions made to cover pension liabilities (1,759 thousand euros) and life insurance (37 thousand euros). Abertis Infraestructuras, S.A. does not use a remuneration system linked to the evolution of the Company’s share price for any of its employees or any of the members of the Board of Directors. b) At 31 December the Company has given guarantees with third parties for a total amount of 122,171 thousand euros, which principally correspond to guarantees backed by financial institutions to Public Administrations for certain commitments (investments, operation of services, financing, etc.) contracted by subsidiary and associated companies. It is not expected that these guarantees will lead to unexpected material liabilities. c) Fees received by PricewaterhouseCoopers Auditores, S.L. for statutory auditing services corresponding to the 2004 financial year totalled 93 thousand euros and 88 thousand euros for other auditing work. In addition, the fees received by other companies trading under the name PricewaterhouseCoopers for other services provided to the Company totalled 148 thousand euros. Note 19. Subsequent events During 2005, ACDL has completed the Public Takeover Offer for the Shares of the TBI Group, taking full control of the share capital. 146 5. Financial information - 5.2. Parent Company Accounts Note 20. Source and application of funds (thousand euros) Source Resources from operations Net profit for the year Charge for depreciation of fixed assets Charge to investment provision Transfer of deferred expenses to results Losses on fixed assets Charge to provision for expenses and liabilities Profit from investments Profit from fixed assets Capital increase due to merger Provision for expenses and liabilities due to merger Increase in long-term creditors due to merger Long-term debt Bonds Loans Debts with Group companies Transfer of fixed assets Intangible fixed assets Fixed assets Investments Other creditors Total sources 2004 2003 361,076 329,017 20,274 20,098 6,514 — 2,627 2,826 28,475 5,241 5 — — (3,501) (850) (15,243) 409,739 346,820 — — 927,877 6,512 234,118 346,839 450,000 350,000 37,235 60,102 472,725 53 3,548 — 50 22,400 638,373 184,618 — 2,511 2,245,791 2,247,729 Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 147 Application Acquisition of fixed assets Start-up costs Intangible fixed assets Tangible fixed assets Investments Group companies Other financial investments Long-term loans to Group companies Increase in assets and deferred expenses due to merger Increase in deferred expenses Cancellation of long-term debt Dividends Provision for expenses and liabilities Reduction in payments pending Transfer of short-term debt to long-term Total applications 2004 2003 197 255 21 1,104 386 619 217,991 322,921 — 383 1,030,904 11,483 239,313 1,424,487 3,355 234,118 — — 243,414 197,350 1,759 1,126 170,000 8,402 — — 2,142,453 1,967,135 Excess of sources over applications /(applications over sources) Increase/(Decrease) of working capital 103,338 280,594 Change in working capital Increase/(Decrease) current assets Receivables Short-term investments Treasury Payments and accruals (Increase)/Decrease current liabilities Short-term creditors Change in working capital 2,229 (1,351) (176,120) 383,817 566 — 2,333 (2) (173,325) 384,797 276,663 (104,203) 103,338 280,594 148 5. Financial information - 5.2. Parent Company Accounts ANNEX* Direct shareholdings (thousand euros) Company Registered office Activity Auditors % Holding Share Reserves capital (less interim divid.) Result for year shareholding Value of Dividends received Abertis Infraestructuras Finance, B.V. Rokin, 55 1012KK. Ámsterdam (Netherlands) Financing — 100.00 18 1,982 (23) 2,000 — Serviabertis, S.L. Av. del Parc Logístic, Management 12-20. Barcelona services Highways Autopistas, C.E.S.A. (ACESA) Av. del Parc Logístic, 12-20. Barcelona Toll highway concessionaire PwC 100.00 3 — 7 3 — PwC 100.00 876,465 544,443 245,039 1,647,187 249,510 PwC 100.00 419,643 442,461 139,244 991,587 147,042 PwC 100.00 50,000 110,705 47,157 223,560 40,004 Other auditors 100.00 14,182 — 1,312 23,363 1,893 PwC 100.00 527 1,488 41 805 — — 100.00 60 174 124 60 — PwC 79.20 34,642 11,250 (733) 43,168 — Toll highway concessionaire Toll highway concessionaire Holding company of concessionaires Toll highway concessionaire Infrastructures administration and management Toll highway concessionaire Infrastructures concessionaire Other auditors 75.00 1,099 (11,588) 903 4,640 — Infrastructures concessionaire PwC 50.00 27,648 3,122 7,599 46,746 3,533 Infrastructures concessionaire Other auditors 39.04 8,602 37,269 12,635 17,789 5,932 Paseo de la Autopistas Aumar, S.A.U.C.E. Alameda, 36. (AUMAR) Valencia Iberpistas, S.A.U.C.E. Pío Baroja, 6. Madrid Aurea Limited 180 Strand. London (United Kingdom) Promoción de Autopistas Chile Limitada (Iberpistas Chile) Gertrudis Echenique, 30. Las Condes-Santiago (Chile) Gestión Integral Montalbán, 5. de Concesiones, Madrid S.A. (GICSA) Autopistas de León, S.A.C.E. (AULESA) Autopistas de Puerto Rico y Compañía, S.E. (APR) Villadangos del Páramo. Ctra. Santa María del Páramo. León Montellano Sector Embalse. San José (Puerto Rico) Autopista Trados-45, S.A. (TRADOS-45) Ctra. M-203 P.K. 0,280. Madrid Concesionaria Vial Carrera novena, de los Andes, S.A. 126-91. Santafé (COVIANDES)(1) de Bogotá (Colombia) * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 149 Direct shareholdings (thousand euros) Company Registered office Activity Auditors % Holding Share Reserves capital (less interim divid.) Result for year shareholding Value of Dividends received Pt Operational 1 Lavender Road Services Limited Bon Accord 009 (PTY) Pretoria (South Africa) Operation and maintenance Other auditors 33.30 0 (715) 2,281 — 752 Autopistas del Sol, S.A. (AUSOL) 986, Piso 4. Leandro N. Alem, Toll highway concessionaire 31.59 43,585 (195,920) 57,215 147,548 — PwC/ Other auditors Toll highway concessionaire Other auditors 25.00 72,308 18,114 13,920 22,748 — Buenos Aires (Argentina) Av. Andrés Bello, 2777- Las Condes. Santiago (Chile) Sociedad Concesionaria del Elqui, S.A. (ELQUI) Concesiones de Madrid, S.A. (CONCEMA) Av. Europa, 18. Alcobendas. Madrid Infrastructures concessionaire Other auditors 25.00 28,798 1,370 4,587 21,977 1,209 Infraestructuras Golfo de Salónica, y Radiales, S.A. (IRASA) 27. Madrid Infrastructures administration and management Other auditors 22.50(2) 8,228 56,400 (16,598) 12,191 — Car parks Saba Aparcamientos, S.A. (SABA) Logistic Services Av. del Parc Logístic, 12-20. Barcelona Car park operator PwC 99.26 18,243 99,681 14,825 231,244 11,756 Abertis Logística, S.A. Av. del Parc Logístic, 12-20. Barcelona Logistics promotion PwC and technical assistance Telecommunications 100.00 55,832 11,230 (624) 66,993 — Abertis Telecom, S.A. Av. del Parc Logístic, 12-20. Barcelona Telecommunication — services 100.00 300,000 9,160 (5,948) 326,433 — Airports Airport Concession and Development Limited (ACDL) Compañía de Desarrollo Aeropuerto Eldorado, S.A. (CODAD)(1) 159 New Bond Street Holding London W1S 2UD (United Kingdom) company of airport companies — 90.00 22,072 198,648 — 204,224 — Carrera 13, nº 93-40. Airport Santafé de Bogotá (Colombia) construction and maintenance Other auditors 85.00 11,455 2,823 11,615 45,751 2,755 4,080,017 464,616 Foreign currency amounts are converted to euros using year-end exchange rates. * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. 150 5. Financial information - 5.2. Parent Company Accounts Indirect shareholdings (thousand euros) Company Registered office Activity Auditors % Company Indirect that owns holding indirect holding Share capital Reserves (less interim Profit for year dividend) Through AUTOPISTAS, C.E.S.A. Autopistas-Conces. Espanhola, SGPS, S.A. Rua General Norton Holding de Matos, 21-A. Arquiparque Algés Oeiras (Portugal) company of concessionaires Brisa, Auto-estradas Quinta da Torre da de Portugal, S.A. (3) Toll highway Aguilha, Edificio Brisa, concessionaire 2785-589. Sao Domingos de Rana (Portugal) Acesa Italia, S.R.L. Via delle Quattro Fontane, 15. Rome (Italy) Holding company of concessionaires Schemaventotto, S.p.A. Calmaggiore, 23. Treviso (Italy) Holding company of concessionaires Autostrade, S.p.A. (6) Via A. Bergamini, 50. Toll highway Rome (Italy) concessionaire Autopistes de Catalunya, S.A. (AUCAT) Av. del Parc Logístic, 12-20. Barcelona Toll highway concessionaire Grupo Concesionario Ruta Nacional nº 7, km 25,92. del Oeste, S.A. Ituzaingó (Argentina) (GCO)(1 and 7) Toll highway concessionaire Túnel del Cadí, S.A.C. Carretera de Toll highway Autopista Terrassa- Manresa, Autema, Concessionària de la Generalitat de Catalunya, S.A. (AUTEMA) Through AUMAR, S.A Ciralsa, S.A.C.E. Vallvidrera a St. Cugat, concessionaire km 5,3. Barcelona Autopista C-16, km 41. Barcelona Toll highway concessionaire Av. Maisonnave, 41. Alicante Construction, conservation and operation of toll highways Through IBERPISTAS, S.A.C.E. Castellana de Autopistas, S.A.U.C.E. Pío Baroja, 6. Madrid Toll highway concessionaire PwC 100.00 acesa 1,000 308,358 42 Other auditors 10.00 Autopistas- 600,000(4) 606,052(4) 101,183(4) Conces. Espanhola, SGPS PwC 100.00 acesa 166,341(5) 4,080(5) 1,188(5) Other auditors Other auditors 13.33 Acesa Italia 445,536 951,467 561,635 6.95 Schemaventotto 571,712(4) 428,492(4) 117,598(4) PwC 100.00 acesa 96,160 15,178 23,298 PwC 48.60 acesa 20,160 (9,379) 3,828 Other auditors 37.19 acesa 105,504 8,405 2,371 PwC 23.72 acesa 69,411 (3,485) 14,031 — 25.00 aumar 50,167 — — PwC 100.00 iberpistas 46,800 187,591 (91) * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 151 Indirect shareholdings (thousand euros) Company Registered office Activity Auditors % Company Indirect that owns holding indirect holding Share capital Reserves (less interim Profit for year dividend) Iberavasa de Inversiones, S.L.U. Pío Baroja, 6. Madrid Holding company PwC 100.00 iberpistas 24,207 15,568 3,808 Autopistas Vasco-Aragonesa, C.E.S.A. (AVASA) Barrio de Anuntzibai, Toll highway s/n 48410. Orozco. Vizcaya concessionaire Other auditors 50.00(8) Iberavasa 234,000 5,240 45,631 Áreas de Servicio y Autopista A68, km 6. Vizcaya Mantenimiento, S.A. Food services Barrio de Anuntzibai, s/n. Vizcaya Inactive Vasco-Aragonesa de Servicios y Concesiones, S.A. Iberacesa, S.L. — — 50.00 Avasa 600 643 (3) 50.00 Avasa 110 4 1 Caleruega,102-104. Holding company — Madrid of concessionaires 100.00 iberpistas 32,229 7,212 (1,141) Ingeniería y Sistemas Pío Baroja, 6. Madrid Technical de Gestión de Autopistas, S.A. (ISGASA) engineering services — 100.00 Iberacesa 61 1,081 779 Alazor Inversiones, S.A. Rozabella, 6. Las Rozas. Madrid Holding company of concessionaires Accesos de Madrid, C.E.S.A. Rozabella, 6. Las Rozas. Madrid Toll highway concessionaire Tacel Inversiones, S.A. Hórreo, 11. Santiago Holding company of concessionaires de Compostela Autopista Central Gallega, C.E.S.A. Hórreo, 11. Santiago Toll highway de Compostela concessionaire Other auditors Other auditors Other auditors Other auditors 23.34 Iberacesa 199,000 23.34 Alazor 199,000 Inversiones 5 5 (6,077) (6,001) 18.00 Iberacesa 32,250 (852) (1,138) 18.00 Tacel 32,250 (856) (1,110) Inversiones Ibermadrid de Infraestructuras, S.A. Madrid Pío Baroja, 6. Study, promotion — and construction of civil work infrastructures 100.00 iberpistas 500 (147) 5 Proconex, S.A. Pío Baroja, 6. Madrid Operation of subleased service areas — 100.00 iberpistas 100 (870) 1,317 Through Aurea Ltd. Road Management Group (RMG) 130 High Street Old Woking Surrey (United Kingdom) Toll highway concessionaire Other auditors 25.00 Aurea Limited 35,931 60,083 10,222 Through Iberpistas Chile Gestora de Autopistas, S.A. (GESA) Andrés Bello, 2777. Las Condes. Santiago (Chile) Toll highway concessionaire PwC 51.00 Iberpistas Chile 1,058 1,015 162 * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. 152 5. Financial information - 5.2. Parent Company Accounts Indirect shareholdings (thousand euros) Company Registered office Activity Auditors % Company Indirect that owns holding indirect holding Share capital Reserves (less interim Profit for year dividend) Through Trados 45 M-45 Conservación, S.A. Ctra. M-203 P.K. 0,280. Madrid — Highway and conservation concessionaire 37.50 Trados 45/ CONCEMA 553 — — Through INFRAESTRUCTURAS Y RADIALES, S.A. Autopista del Henares, S.A.C.E. (HENARSA) Erredosa Infraestructuras, S.A. (ERREDOSA) Through SABA Golfo de Salónica, 27. Toll highway Madrid concessionaire Other auditors 22.50 Infraestructuras y radiales 96,700 328,897 (2,358) Golfo de Salónica, 27. Infrastructure Madrid administration and management Other auditors 22.50 Infraestructuras y radiales 61 (3) (2) Saba Estacionamientos de Chile, S.A. Andrés Bello, 2777. Las Condes. Santiago (Chile) Car park operator Concesionaria Subterra Concesionaria Subterra Dos Spel-Sociedade de Parques de Estacionamento, S.A. (SPEL) Andrés Bello, 2777. Las Condes. Santiago (Chile) Andrés Bello, 2777. Las Condes. Santiago (Chile) Car park operator Car park operator Guedes de Azevedo, Car park operator 148-180. Oporto (Portugal) Liz Estacionamientos Guedes de Azevedo, Car park operator 148-180. Oporto (Portugal) Parbla, S.A. Societat Pirenaica d’Aparcaments, S.A. (SPASA) Societat d’Aparcaments de Terrassa, S.A. (SATSA) Saba Italia, S.p.A. Car park operator Car park operator Sabino Arana, 38. Barcelona Pau Casals, 7. Escaldes-Engordany (Principality of Andorra) Plaça Vella, subsuelo. Car park operator Terrassa Via delle Quattro Fontane, 15. Rome (Italy) Car park operator PwC 99.26 saba 11,500 (60) (89) PwC 99.26 Saba Chile 1,248 (115) 260 PwC PwC 99.26 Saba Chile 805 1 99.26 saba 6,000 22,889 (55) 81 PwC 50.62 Spel 500 10 59 — — 99.26 saba 3 1,172 27 89.33 saba 301 32 140 PwC 87.39 saba 7,313 434 891 PwC 59.56 saba 28,600 3,713 (2,704) * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 153 Indirect shareholdings (thousand euros) Company Registered office Activity Auditors Saba Campo San Giacomo Parcheggi Pisa Via delle Quattro Fontane, 15. Rome (Italy) Via delle Quattro Fontane, 15. Rome (Italy) Car park operator Car park operator Parcheggi Bicocca Via Gaetano Negri, 10. Milan (Italy) Car park operator Port Mobility Rabat Parking, S.A. Località Porto del Turco, 53. Civitavecchia Rome (Italy) Rue de Larache, 8. Rabat (Morocco) Las Mercedes Sociedad Concesionaria, S.L. Las Mercedes, s/n. Las Arenas-Getxo. Vizcaya Through ABERTIS LOGÍSTICA Sevisur Logística, S.A. Moratín, 1. Seville Parc Logístic de la Zona Franca, S.A. (PLZF) Av. del Parc Logístic, 2-10. Barcelona Car park operator Car park operator Car park operator Construction and operation of logistics area Promotion and operation of logistics area Areamed 2000, S.A. Vía Augusta, 21-23, Operation of service areas Barcelona Araba Logística, S.A. Olaguibel, 2. Vitoria (ARASUR) Centro Intermodal de Logística, S.A. (CILSA) Av. Ports d’Europa, 100. Barcelona Construction and operation of logistics area Promotion and operation of logistics area % Company Indirect that owns holding indirect holding Share capital Reserves (less interim Profit for year dividend) 58.96 Saba Italia 100 — (6) 41.69 Saba Italia 50 — (6) 14.89 Saba Italia 1,500 — (1,323) 5.96 Saba Italia 1,500 — — — — — — Other auditors 50.62 saba 1,879 (328) (34) — 33.33 saba 611 — (34) PwC 60.00 abertis logística 3,000 (59) (173) Other auditors Other auditors 50.00 abertis logística 23,742 (622) 1,529 50.00 abertis logística 70 7,608 1,882 PwC 39.77 abertis logística 6,408 1,548 (217) Other auditors 32.00 abertis logística 15,467 25,304 1,040 Through ABERTIS TELECOM Difusió Digital Societat de Telecomunicacions, S.A. (TRADIA) Motors, 392. L’Hospitalet de Llobregat. Barcelona Adquisición de Motors, 392. emplazamientos, S.L. L’Hospitalet de Llobregat. (ADESAL) Barcelona Telecommunication Other infrastructures operator auditors 100.00 abertis telecom 131,488 (33,029) 225 Inactive — 100.00 tradia 3 (0.3) — * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. 154 5. Financial information - 5.2. Parent Company Accounts Indirect shareholdings (thousand euros) Company Registered office Activity Auditors % Company Indirect that owns holding indirect holding Share capital Reserves (less interim Profit for year dividend) Retevisión I, S.A. Gran Via de les Corts Telecommunication Other 100.00 abertis telecom 81,270 118,193 7,003 Catalanes, 130-136. infrastructures auditors Barcelona operator Torre de Ctra. de Vallvidrera Construction Other 41.75 Retevisión I 12,020(5) 564(5) 107(5) Collserola, S.A. al Tibidabo, s/n. and operation of auditors Barcelona telecommunication infrastructures Through ACDL TBI, plc(9) 159 New Bond St. Airport operator PwC 26.28 ACDL 81,388 331,974 14,381(10) London W1S 2UD (United Kingdom) Foreign currency amounts converted to euros using the year-end exchange rate. (1) Financial statements at 31 December 2004 without including the effect of inflation considered in local criteria. (2) Direct shareholding of abertis 15%. Indirect holding through Iberpistas S.A.C.E and Avasa of 7.5%. (3) The shares of Brisa, Auto-estradas de Portugal, S.A. are traded on the Lisbon Stock Exchange. The average weighted price in the last of quarter 2004 was 6.47 euros. At year-end the price was 6.75 euros. Information at 30 June 2004. Information at 31 December 2003. (4) (5) (6) The shares of Autostrade, S.p.A. are traded on the Milan Stock Exchange. The average weighted price in the last quarter of 2004 was 17.907 euros. At year-end the price was 19.70 euros. (7) The shares of GCO are traded on the Argentina Stock Exchange. The average weighted price in the last quarter of 2004 was 1.36 Argentine pesos. At year-end the share price was 1.66 Argentine pesos. 57.6% of the voting rights are held. (8) The shares of Avasa are pledged by virtue of the share pledge agreement dated 2/8/2001 as guarantee on a loan. (9) Group that was listed on the London Stock Exchange until its acquisition by ACDL. This Group is made up of various companies in different countries and operates (under concession or ownership) eight international airports (Europe, United States and Latin America) and manages fully or partially, on behalf of governments or local authorities, another six airports. (10) Corresponds to the 9 months of the financial year to 31 December 2004. * This annex forms an integral part of Note 7 to these 2004 Annual Accounts, with which it should be read. Annual Report 2004 5. Financial information - 5.2. Parent Company Accounts 155 ABERTIS INFRAESTRUCTURAS, S.A. Management Report for 2004 2004 was the second full year of activity for Abertis Infraestructuras, S.A. (abertis), one of the leading managers of mobility and communications infrastructures operating in the sectors of highways, car parks, logistic infrastructures, telecommunication infrastructures and airports. As head of an important business group, the objective of abertis is to continue offering its shareholders a balanced combination of investments in the above-mentioned sectors that ensure an adequate combination of low risk, growth and yield. In this respect, the following events in 2004 should be highlighted: • • • • • In the highways sector, the award of the Alicante Ring Road tender to a consortium in which abertis holds 25%, the start of operations of Radial 3 and 5 in Madrid (23% share held by abertis), the acquisition of 0.5% shareholding in Schemaventotto (company that groups the core shareholders of Autostrade) and the capital gains on the sale by Schemaventotto of 10% of Autostrade and the sale by Autostrade of 5% of abertis. With the objective of rationalising the ownership structure of the Group the operations of abertis and iberpistas (100% owned) have been merged. In the car parks sector, during the year saba reached an important agreement on a new fee model with the Barcelona City Council, along with an investment plan to improve the car parks and an extension of the concessions. It has commenced its expansion in Chile with the acquisition of 6 car parks and has embarked on the construction of new car parks in Italy, one of the two main axes, together with Portugal, of its international expansion until entering Latin America. In the logistic infrastructures sector, development of the logistics projects at Alava, Seville and ZAL Prat, in which abertis is a shareholder, continues according to plan and the Logistics Park of Zona Franca and ZAL Barcelona are fully occupied. In the telecommunication infrastructures sector, the inclusion of Retevisión Audiovisual in the accounts for 2004 should be noted, having been acquired at the end of 2003, as well as the increase in the shareholding in Torre de Collserola to become the main shareholder with 41.75%. Lastly, in the airports sector the company ACDL was incorporated at the end of the year and presented a Public Takeover Offer for the British airport operator TBI, which was successfully completed in 2005 by taking 100% control. At the end of 2004, investment totalled 204.2 million euros for the acquisition of 29% of TBI. 156 5. Financial information - 5.2. Parent Company Accounts All these actions, combined with the positive performance of the other businesses and activities, have had a positive impact on the key figures and results for the year, and form the base for growth in coming years. The balance sheet of abertis clearly reflects its position as parent company of the Group and mainly comprises the portfolio of shareholdings, on the assets side, and by the financing of these holdings through equity and debt, on the liabilities side. During 2004 the financial structure of the Group has been optimised, centralising the debt in abertis, which is responsible for covering the funding requirements of the subsidiary companies. In addition, there has been an important transfer of short-term debt to long-term debt, enabled to a large extent by the bond issues made in November 2004, in which abertis (through its subsidiary Abertis Infraestructuras Finance BV) concluded a private debt placement of long-term bonds on the US market valued at 600 million dollars (the largest placement in the US Private Placement market made by a Spanish company during the year), and in February 2004, when abertis made a bond issue to institutional investors, also in the international market under Spanish law and documentation, of 450 million euros. In 2004, the profit and loss account basically reflects the transfer of the results generated in the different companies of the Group, through the dividend policy, as well as the costs derived from the corporation structure and the financing of the investments in subsidiary and associated companies. The profit for the year rose to 361 million euros, which represents an increase of 9.7% on the previous year and allows abertis to ensure, in turn, its policy of shareholder return. As in previous years, abertis has maintained its policy of shareholder return that combines the dividend payout with a bonus share issue of one share for every 20 shares held. The Board of Directors of abertis has agreed to propose to the Ordinary Shareholders’ Meeting a final dividend for 2004 of 0.25 euros gross per share, which represents an increase of 12.1% on the final dividend of the previous year, an indication of the confidence in the consolidation of the return on investments made in recent years and their growing contribution to profits. The total dividend charged against results for 2004 will be 264 million euros, including the interim dividend already paid, representing an increase of 11.3% on the dividend payout of the previous year. In 2005 it is expected that the positive contribution of all business units will continue, accentuated by the progressive contribution of all new projects and the most recent incorporations in the Group, with the policy on shareholder return being maintained. The Company has not traded, directly or indirectly, in its own shares with the exception of the acquisition of 111,601 shares in the context of the merger with iberpistas. Due to the small number of shares required for the share swap (0.16% of the share capital of iberpistas), the issue of new abertis shares to exchange with the shareholders of iberpistas was substituted, on prior approval of the Shareholders’ Meeting, by the acquisition of treasury stock that were subsequently exchanged with the minority shareholders. Parent Company Auditor's Report Av. del Parc Logístic, 12-20 08040 Barcelona www.abertis.com www.abertis.com 

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