Fomento de Construcciones y Contratas S.A. Annual Report 2023

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FY2023 Annual Report · Fomento de Construcciones y Contratas S.A.

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Annual Report

2023

Index

1. Letter from the Chairwoman _ 3

Letter from the CEO _ 5

2. Ethical governance at the highest level _ 8

3. Strategy and value creation _ 24

4. FCC in 2023 _ 84

5. Business lines _ 92

A1. Appendix I. Financial Statements _ 269

A2. Appendix II. Sustainability Report _ 560

FCC. Annual Report 2023
1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

Letter from the Chairwoman | Page 1 of 2

Letter from the Chairwoman

Dear shareholders,

In this Annual Report you will find a summary
of the main figures and the most important
milestones that have defined FCC’s activity in 2023.

A year as demanding as it was, extraordinary in
terms of results, a year in which we have once
again proven our ability to turn every challenge
into an opportunity to continue serving and
accompanying our society.

With this background, the FCC Group has moved
forward, controlling the phases involved in the
end-to-end water cycle; optimising resources and
applying circular economy principles; developing
infrastructures; producing the associated materials
necessary to execute them; and entering the world
of real estate management.

We have once again proven
our ability to make each
challenge an opportunity

The results that we as a Group have achieved are
extremely satisfying.

With a turnover of 9,026 million euros, 17.1%
more than in 2022. The Cement and Construction
activities have made a significant contribution
to this growth, followed by a sharp rise in the
Water Area.

Due to our progress in the Group’s main business
areas, in 2023 we improved our Ebitda by 16.6%,
up to 1,529 million euros.

A1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 20231_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

Letter from the Chairwoman | Page 2 of 2

In this last year, we have
kept on adding and we
are still doing it properly

Ebit also grew 49.1% to 910.3 million euros due
to the rise in Ebitda, the base effect of the 2022
adjustment of 200 million euros in the value of
various property, plant and equipment elements
and goodwill in the Cement Area.

Results that allow us to propose a flexible dividend
for our shareholders of over 283.4 million euros
at our AGM, equivalent to 0.65 euros per share,
charged to available reserves and 30% more than
was offered the previous year.

Finally, please allow me to share my sincere
optimism and firm hope in the future. The passion
for a job well done, the resilience and team spirit
that characterise FCC are the best guarantee for
success in the new times to come.

Esther Alcocer Koplowitz
Chairwoman of the FCC Group

At year end 2023, Group financial debt stood at
3.1 million euros, 2.9% less than in 2022.

The backlog reached 41.62 million euros at 31
December, 3.3% up compared to the previous year
end and largely attributable to the notable increase
in Water activity.

I would like to reiterate our gratitude to investors,
shareholders, strategic partners and clients for
their support and trust in our project, with a special
mention for our best capital: each and every
proffesional within the FCC Group, who make it
possible on a daily basis; I thank them for their
engagement and unconditional commitment.

These results are largely due to the strategic
commitment made for some years now, focused
on transformation as a cross-cutting foundation
of our business and on optimising our technical,
operational and financial efficiency. In doing so,
we have again demonstrated that it is possible
to achieve highly satisfactory results through
responsible growth, combined with the pursuit of
profitability in our businesses.

As engineer Carlos Slim usually says:
“Profitability comes from productivity, efficiency,
management, austerity and how business is
managed. Everything adds up if you do it properly”.

And we are. This last year, 2023, we have kept on
adding, and we are still doing it properly.

3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 20231_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

Letter from the CEO | Page 1 of 3

Letter from the CEO

Dear shareholders,

Welcome to the 2023 FCC Group Annual Report.
Over the following pages, you will be able to review
the activity and evolution throughout last financial
year, as well as our performance and progress in
environmental, social and corporate governance
matters.

The last few years have presented a changing
and uncertain context for world economic activity,
and 2023 was no exception due to of different
geopolitical conflicts. Also, the macroeconomic
environment has been characterised by high
interest rates and persistently high inflation,
with the contribution of the global energy crisis.
Another important question for the private sector
are regulatory changes in various business areas,
which require companies to implement essential
procedural changes, requiring investments and the
mobilisation of additional resources.

Turnover amounted
to 9,026 million euros,
17.1% more than in 2022

However, since our company was created at the
beginning of last century, we have proven that
our business model has the capacity to adapt
to different challenges. So in 2023, the Group
has continued to strengthen its leading position
worldwide, operating in more than 38 countries and
reaching a turnover of 9,026 million euros (17.1%
higher than 2022). This increase is an accurate
reflection of the good performance of all business
lines with significant improvements in Construction
(43.5%), Cement (18.9%) and Water (12.4%).

I am proud to present these results, proof of
the continuous improvement of this Group and
the excellent performance in its activities. Our
business model is solid, built on the foundation of
our values, which guide our decision making, and
our governance structure based on transparency
and responsibility.

A1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023Letter from the CEO | Page 2 of 3

The Group obtained a gross
operating result (Ebitda) of
1,529 million euros, 16.6% more
than the previous year

As a leading international company in public
service provision with a mission to efficiently
and sustainably design, implement and manage
environmental services, end-to-end water
cycle management and major infrastructure
construction to improve quality of life, we feel
the obligation to relentlessly face the challenge
represented by the 2030 Agenda. We will
continue in our efforts to adopt the Sustainable
Development Goals as our own, searching for and
promoting new actions.

Moreover, we are fully aware of the role played by
R&D&i investments to optimise our resources,
offer better services and find more effective
solutions for the public. In 2023, we therefore
allocated 13.5 million euros and more than
100 professionals to promoting research,
development and innovation at FCC Group. I would
also like to emphasise the active participation
of different Areas of our company in various
research projects, especially the LIFE programme
projects promoted by the EU and dedicated to
the environment and climate action. Research
and innovation are key to improve our Group’s
competitiveness. We will need new technologies to
face the main challenges of the cities of tomorrow,
offering innovative and sustainable solutions.

In terms of the environment, we believe that
FCC Group can play a key role in the challenges
and that is why we are firmly committed to
contributing to the fight against climate change.
By implementing adaptation solutions as part of
the 2050 Climate Change Strategy, in 2023 we have
reduced our greenhouse gas (GHG) emissions
by 8% compared to the previous year. This is an
example of the contributions we feel we can make,
suitably managing our interactions with the natural
environment by setting ambitious environmental
goals and transparent practices.

In relation to our social management, we have
reinforced our workforce compared to the previous
year with over 3,000 new recruitments in our
Group. We are currently more than 67,000 people
with values including our search for community
well-being and development, which explains our
participation and active collaboration in social
programmes and initiatives. In recognition of these
efforts, FCC has received the 2023 ONCE Social
Group Region of Madrid Charity Award in the
Business category, in appreciation of our projects
to tackle aspects such as inequality, poverty or the
risk of social exclusion.

Another of our shared values is honesty and
respect, pillars of our performance in corporate
governance. Together we all promote transparency,
ethics and respect for the law and we want to
be part of this culture. In this vein, this year we
have adapted the Group Compliance Model to the
requirements introduced by the new Law 2/2023,
of 20 February, regulating the protection of people
who report breaches of regulations and the fight
against corruption.

Ebit rose by
49.1% in 2023 to
910.3 million euros

Entering into more detail in the economic sphere,
the Group obtained a gross operating result
(Ebitda) of 1,529 million euros, 16.6% more than
the previous year. Meanwhile, our net operating
result (Ebit) saw a rise in 49.1% compared to last
year, up to 910.3 million euros. The company’s
attributable net result was 591 million euros, a
significant increase of 87.5% on the previous year.
This is a direct consequence of the operating result
as well as using the equity method to include the
Metrovacesa stake in the Real Estate Area. As for
the business portfolio, the figure recorded at the
end of last year was 41,620 million euros, with a
3.3% increase on the previous year and a notable
rise in Water business.

Each business area of our company has stood
out in 2023 for some relevant milestones, which
I would like to highlight:

Firstly, in 2023 we closed the sale of 24.99% of the
Environmental Services Area parent company to
the Canadian investment fund CPP Investment.
The new shareholder will reinforce the positioning
and strategic development of the subsidiary, its
areas and regions where it operates. Furthermore,
the Area agreed to buy the business of Urbaser
group, UK, and has reinforced its presence in the
US, becoming one of the 15 main companies
in that country in solid waste management and
recycling. Milestones worthy of note at national
level include a contract to modernise and operate
the Jerez region treatment plant in Cádiz (Spain),
which will serve around half a million people.

The Water Area entered into the US market
by acquiring 97% of MDS (Municipal District
Services, LLC) is worthy of note. With this
operation, Aqualia begins to provide service to
a population of over 364,000. Specialisation in
end-to-end water cycle management maintains
our position and competitiveness in Europe. In
Spain, new desalination and reuse actions stand
out. Finally, in 2023, Aqualia was awarded relevant
contracts in France, Colombia and Saudi Arabia
which reinforced its position.

Meanwhile, the Construction Area has bolstered
its position in the main markets in Spain with the
award of construction works for the new ONCE
headquarters in Madrid; underground work on
the R-2 Cercanías commuter train line through
Montcada i Reixac (Barcelona); or the engineering
and construction projects for photovoltaic plants in
Seville and Cáceres by FCC Industrial.

At international level, the consortium led by
FCC Construcción was chosen as the
preferred bidder to execute works on the
new underground line in Porto, an additional
6.3 kilometres for the city’s underground network.
FCC Industrial has also obtained a major contract
to build a regasification terminal in Germany,
with a portfolio of 270 million euros, which will be
the country’s second LNG (liquefied natural gas)
regasification plant. The company continues its
activity in the Netherlands with new contracts
including one to build a modern Pallas reactor, a
key project that will help treat multiple patients
to treat multiple patients suffering from cancer
and cardiovascular diseases. Also, a contract to
modernise a series of bridges in Pennsylvania
(US A).

The Cement Area saw a significant increase in
sales despite a slowdown in the Spanish sector
during the last months of 2023. In this context, the
Area redefined the values and behaviours of its
business culture seeking the alignment with the
new purpose to Promote Sustainable Progress: be
stronger, more solid and sustainable in operations
and decision making. The goal is to remain a
benchmark in the sector in all countries where the
Area operates.

Finally, in 2023, the Real Estate Area boosted its
consolidation by increasing the FCC Property
(of which it controls 80.03% of the capital) stake in
the investee companies Realia Business, S.A. and
Metrovacesa, S.A., increasing its stake to 66.29%
and 21.21%, respectively. With this movement, the
Group’s Real Estate Area continues to enhance its
assets and make the most of property business
opportunities.

We close 2023 as a year in which we have
reinforced our leadership position, achieving major
economic results and strengthening our human
capital. Despite the challenges facing today’s
society, FCC Group has been able to generate and
create opportunities for growth.

Lastly, I would like to sincerely thank you all,
shareholders, investors, strategic partners and
clients, for your ongoing support and the trust you
place in our company year after year. Having you
by our side on this journey means we can maintain
our growth over time. You give us the strength
we need to advance in fulfilling our corporate
missions: improving quality of life.

No company achieves
business success without
its main asset: a great team

With my final words, I would like to stress the
admirable daily work of every member of the
FCC Group workforce. This team, made up of
excellent professionals, continuously proves their
talent and vocation and are the foundations for
building our corporate culture. Please continue to
show your best version, defending our values in an
honest and exemplary way. No company achieves
business success without its main asset: a great
team behind it. You are the real success of FCC.

Pablo Colio Abril
CEO of the FCC Group

Ethical governance at the highest level

1. Governance with values _ 9

2. Ethical conduct and integrity _ 13

3. The FCC Group’s Risk Management Model _ 20

FCC. Annual Report 202321_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

Governance with values | Page 1 of 4

1. Governance with values

For FCC Group, governance rooted in the principles
of sustainability, integrity and business ethics is a
priority reflected consistently in its values, decision-
making and corporate practices. FCC reinforces
and guarantees exemplary behaviour, ensuring
regulatory compliance and business conduct
based on transparency, equity, ethics and integrity,
promoting its commitment to sustainability and
corporate responsibility.

The FCC Group Code of Ethics and Conduct
and the Compliance Model are the foundations
for company governance, setting the standards
of behaviour and integrity of the value chain,
covering all Group employees, the community and
stakeholders and including environmental, social,
labour and good governance commitments.

As part of its commitment to best good
governance practices, FCC Group aligns with
the Unified Good Governance Code of Listed
Companies by the National Securities Market
Commission (CNMV by its acronym in Spanish)
recommendations, incorporating around 85%
of the most stringent international standards
and focusing its efforts on recommendations
that include sustainability as part of the scope
of the Board of Directors.

1.1.
Governance structure

The FCC Group corporate governance structure
comprises several bodies that are fundamental
for strategic and efficient decision making that
favours of a responsible corporate culture: the
General Shareholders’ Meeting, the Group’s
ultimate decision-making body that sets the Group
strategy; the Board of Directors, which represents
the highest powers for managing, administering
and representing the company; and three specific
committees, the Executive Committee, the Audit
and Control Committee and the Appointment and
Remuneration Committee, which favours effective
and transparent management and supervision.

Within its commitment to ethical and transparent
management, each year FCC Group publishes
the Corporate Governance Report that includes
information on the governance structure, best
practices and follow-up on Code of Good
Governance recommendations. This report is
available on the FCC corporate website.

FCC. Annual Report 2023A1_ Financial StatementsA2_Sustainability Report1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

Governance with values | Page 2 of 4

Governance structure

It is governed by the provisions of Law, the company's Articles of Association, and the Regulations of the General Meeting. The shareholder structure is reflected in the Board of Directors and, in accordance with the Articles of Association, the right to information, attendance and voting at the General Shareholders’ Meeting is recognised for holders of one or more shares.Body entrusted with the administration, representation and control of FCC in accordance with the powers set out in the Articles of Association and the Board Regulations.At the end of 2023, the FCC Group Board of Directors had 11 members, with women representing 36% of its members and various nationalities represented.In 2023, the Board met a total of 14 times with an average attendance of 91.52%. It approved the Equality, Diversity and Inclusion Policy and the Internal Information System Policy, in addition to occasionally amending the FCC Group Code of Ethicsand Conduct.The permanent delegation body appointed by the Board of Directors that makes decisions related with FCC Group Investments, access to credits, loans and other financial instruments. Executive CommitteeSpecifically, in 2023, the Executive Committee met eight times, reaching a total of 36 agreements.A body with no executive duties but with information, advice and proposal powers. It supports the Board in the tasks of financial and non-financial reporting supervision and sending reports to the General Shareholders’ Meeting; exercising internal controls and assessing the efficiency of the risk policy; and liaising and ensuring the independence of the external auditor.Audit and Control CommitteeThe Audit and Control Committee held ten meetings in 2023 in which it addressed various Compliance and Sustainability matters as it is in charge of supervising the corporate environmental, social and governance policies and informing the Board of Compliance Model updates.The body responsible for advising, informing and proposing the re-election, ratification and dismissal of directors, as well as their remuneration and the remuneration of FCC Group senior management. Responsible for detecting possible conflicts of interest and related transactions, as well as taking Appointment and Remuneration Committeeon any duty attributed by Law, the FCC Group Articles of Association or the Board of Directors Regulations. In 2023, the Appointment and Remuneration Committee met six times, reaching a total of 19 agreements.Board of DirectorsGeneral Shareholders' Meeting1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

Governance with values | Page 3 of 4

Composition of the Board of Directors and its Committees

Members of the Board
of Directors

Position
on the Board

Nature

Executive
Committee

Audit
and Control
Committee

Appointment
and Remuneration
Committee

Esther Alcocer Koplowitz

Chairwoman

Proprietary

Juan Rodríguez Torres

Carlos Slim Helú

Director

Proprietary

Álvaro Vázquez de Lapuerta

Director

Independent

Esther Koplowitz Romero de Juseu

First Vice Chairwoman

Proprietary

Pablo Colio Abril

Chief Executive Officer

Executive

Alejandro Aboumrad González

Vice Chairman

Proprietary

Carmen Alcocer Koplowitz

Alicia Alcocer Koplowitz

Manuel Gil Madrigal

Gerardo Kuri Kaufmann

Director

Proprietary

Independent

Proprietary

Chairman/Chairwoman

Member

Governance with values | Page 4 of 4

1.2.
Remuneration model

FCC Group has set a Remuneration Policy
for 2022-2025 on the remuneration model for
directors. It guarantees the principles and values
of FCC and ensures that director remuneration is
fair and reasonable.

Remuneration of executive and non-executive
personnel at FCC Group is set according to
different criteria such as position, duties, level of
responsibility and competences, and pursuant on
the circumstances of the company, country and
market depending on each activity.

The Remuneration Policy provides a mixed
system and all information on how it was applied
in 2023, including detailed remuneration, is
reported and published in the Annual Report on
the Remuneration of Directors, available for
consultation on the FCC corporate website.

Remuneration necessary to attract and retain
directors with an adequate profile.

Remuneration according to the interests
of the shareholders and Group.

Balanced remuneration that can reward
dedication, qualification and responsibility,
and allow directors to maintain independent
criteria.

Remuneration related with professional
performance of beneficiaries.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportAccording to the Board of Directors Regulations, the remuneration policy must respect the following criteria:1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

Ethical conduct and integrity | Page 1 of 7

2. Ethical conduct and integrity

2.1.
Business conduct

The FCC Group integrity and corporate ethics
framework responds to the need for reinforcing
and guaranteeing exemplary behaviour and
ensuring that anyone linked to its activity ensure
regulatory compliance as a key factor in their firm
commitment to due diligence.

Compliance Model

The FCC Group Compliance Model fosters
transparency, respect for law and due diligence by
means of effective governance and reporting. The
Public of the Model is the prevention and detection
of risks of non-compliance and behaviours that
could lead to criminal offences.

The FCC Group Code of Ethics and Conduct is the
cornerstone for this Model and responsible Group
management which, following its approval in 2012
and the latest review in 2023, is implemented
with policies, with the principles and behaviours
expected of the workforce, executive teams,
suppliers and contractors, as well as processes
and controls on a consolidated regulatory base.

The FCC Compliance Committee is a top-level
body with independent powers of initiative and
control. It depends on the Audit and Control
Committee of the FCC Board of Directors. The
committee is part of the Model as the Group’s
Criminal Prevention body. Its powers include
monitoring and supervising regulatory compliance
programmes, promoting ethical culture and
preventing illegal behaviours. Compliances
committees have also been set up in the
businesses with a similar composition and duties
so as to provide support to their decision-making
bodies and the Committee itself.

The FCC Compliance Committee is chaired by
the corporate Compliance Officer and includes
the Legal Service general manager and Human
Resources manager. The general Internal
Audit manager also participates, taking part in
investigations if necessary, and the business
Compliance Officers attend Committee meeting,
in this case as guests. During 2023, the
Compliance Committee met a total of twelve
times, once at an extraordinary meeting.

Compliance Model regulatory base

Code of Ethics and Conduct.

Competition Policy.

Crime Prevention Manual.

Anti-corruption Policy.

Gift Policy.

Agent Policy.

Policy on relationships with partners in relation
to compliance.

FCC Group participation policy in bidding
processes for goods or services.

Tax Compliance Policy.

Human Rights Policy.

Equality, Diversity and Inclusion Policy.

Internal Reporting System Policy.

Compliance Comittee Regulations.

Whistleblowing Channel Procedure.

Investigation and Response Procedure.

Protocol for the Prevention and Eradication
of Harassment.

FCC. Annual Report 20233_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportEthical conduct and integrity | Page 2 of 7

Most relevant actions to the FCC Group Compliance Model 2023

Adaptation of the Model to the new Law
2/2023, of 20 February, regulating the
protection of people who report breaches of
regulations and the fight against corruption.

Two six-monthly self-assessments and
certification of the Compliance Tool, of
controls and processes designed to minimise
the most significant criminal risks.

Approval of the FCC Group Internal
Information System by the Board of
Directors, as well as updating the regulatory
base.

Implementation of the Annual Compliance
Training Plan 2023 and approval of the
Three-year Training Plan 2024-2026.

Review of the Compliance Model by a

prestigious external firm for independent
assessment.

Launch of the global training course in

“Conflicts of Interest” in twelve countries and
eight languages.

Boost to the number of investee companies
and joint ventures adhered to the Model with
defining their own.

Assessment of supplier risk in Compliance

for 771 new suppliers, with 20 of them
requiring specific assessment from the
Compliance department.

Annual supervision by the FCC Group Internal

220 due diligence evaluations on third parties

Audit department.

(potential partners, agents and suppliers),
from the Group’s different businesses.

Review of the criminal risk assessment

and updating of the Model’s crime, risk and
control matrixes.

Dissemination and training in the Compliance
Model are a fundamental tool in preventing crimes
such as corruption, fraud, money laundering and all
criminal offences or breaches of the rules applying
to the FCC Group. To respond to this need for
knowledge and training, a training plan has been
defined with three priority subjects —FCC Group
Code of Ethics and Conduct, Competition and
Corruption—, mainly online for greater reach and
with in-person seminars when required for the type
of training.

Whistleblowing Channel

The FCC Group Whistleblowing Channel is one of
the key measures adopted to prevent regulatory
non-compliance. It is available to employees and
stakeholders, guarantees their rights and enables
them to exercise their duty to report possible
breaches of the FCC Group Code of Ethics and
Conduct as well as the Compliance Model. A tool
that is accessible on the intranet, corporate website
and by post, it favours anonymous, confidential and
repercussion-free collaboration in the identification
of possible breaches.

The Channel is managed by the FCC Group
Compliance Committee according to the specific
procedures of the Whistleblowing Channel and
the Investigation and Response Procedure. A total
of 214 communications were received in 2023, of
which 137 were classified as relevant and 77% of
the notifications were of a labour nature.

2.2.
Prevention and detection
of corruption and
bribery

FCC Group has a firm commitment to zero
tolerance for corruption, bribery and all forms
of extorsion. The FCC Group Code of Ethics and
Conduct is the core of the regulatory framework
that reflects the transparency, integrity and
eradication of corrupt practices in all Group
operations, implemented in different prevention
and control policies and measures.

In addition to the FCC Anti-corruption Policy, the
Group has other policies and procedures that
favour transparency, ethics and the fight against
corruption. These include the Agents Policy, which
regulates relations with any commercial agent or
business partner; the Gift Policy, on the principles
related with giving and accepting gifts; the Bid
Policy and procurement processes by public and
private entities and the submission of bids; and
the Competition Policy to ensure compliance with
regulations and prevent any breach. In 2023, the
Group Internal Reporting System Policy was also
approved; it regulates the protection of people who
report breaches, regulations and the fight against
corruption.

The FCC Group regularly conducts a global
analysis taking into account its operations and
jurisdictions to assess the risk of exposure to
crimes related with corruption and bribery.
This analysis is based on a matrix of the different
risk events and defining controls that will prevent
crimes being committed.

In line with the promotion of a corporate culture of
Compliance, training in anti-corruption is provided
for FCC Group employees and is mandatory for
the risk group. At the end of 2023, more than 5,000
have completed this training.

The FCC Anti-corruption Policy, applicable
to all Group employees and companies, set
out the following principles:

Principles of the FCC Anti-corruption Policy

Compliance with the law and ethical

Prevention of money laundering.

Rigour in control, reliability and

values.

transparency.

Zero tolerance of bribery and corruption.

community.

Managing conflicts of interest.

Transparent relations with the

Extension of commitment to business

Monitoring of ownership and

partners.

confidentiality of data.

Promotion of continuous training

on ethics and compliance.

2.3.
Money laundering

FCC Group strictly complies with regulations
against money laundering and the financing
of terrorism in all its financial operations and
locations, implementing specific measures to
ensure integrity and transparency with the most
stringent compliance standards. To prevent
potential crimes, in 2023 a risk assessment
was conducted and different controls were
implemented.

Furthermore, the system implemented in audited
each year internally and by an external Agent or
entity to verify its effectiveness and training is
provided to personnel assigned to this activity so
as to detect any risk operation.

In relation with external marketing companies, a
prior analysis is run before contracting them to
verify that their activity and operations adapt to the
general FCC Group principles, we also monitor their
obligation to train their sales agents in this matter.

Checks against money laundering (AML)

Body entrusted with supervising

Assessment and review of powers

and monitoring prevention measures.

of attorney and proxies.

Updated Manual on the Prevention

Review of purchase and sale contracts.

of Money Laundering.

Training the workforce.

Establishment of an internal advisory

and whistleblowing line.

2.4.
Human Rights

With its Human Rights Policy, FCC Group
undertakes and declares to protect and respect
human rights as a fundamental element of
corporate culture and the company’s values.
Approved by the Board of Directors, the Policy is
part of the Group Compliance Model and is aligned
with the United Nations Guiding Principles and the
Universal Declaration of Human Rights (UDHR),
as well as the fundamental principles of the
International Labour Organization (ILO).

Available on the FCC corporate website in 14
languages, the Human Rights Policy extends to all
corporate activities, requiring equal protection from
partners, collaborators and suppliers according to
the FCC Group Code of Ethics and Conduct and the
specific commitment included in the company’s
Sustainability Policy.

The Group also implements due diligence
mechanisms in accordance with the United
Nations Guiding Principles on Business and
Human Rights. The FCC Compliance Model
compiles the commitments, principles and
standards of conduct applicable and which
enable the company to align with the international
benchmark framework and legislation applicable in
each country where it operates.

FCC Group also has a Whistleblowing Channel
where anyone can raise questions and report any
irregularity or beach in company activities affecting
human rights.

Commitments are implemented and monitored by
the Group Sustainability Committees and business
Committees in coordination with the corporate
Human Resources and Procurement departments.

Reinforcing FCC’s commitment, since 2006 the
Group subscribes to the United Nations Global
Compact and its 10 principles which include
companies’ duty to support and respect the
protection of fundamental human rights, also in
the value chains. Specifically, in 2023 the FCC
Group took part in the first edition of the Business
and Human Rights Accelerator, a pioneering
international programme launched by the United
Nations Global Compact.

Once again, to mark Human Rights Day, new
impetus was given to the dissemination of the
FCC Policy and commitment to the Universal
Declaration, which this year celebrated its 75th
anniversary.

FCC. Annual Report 2023

Human Rights commitments by area

Freedom of association and
collective bargaining

To recognise workers’ rights to freedom
of association.

Decent and paid employment

Guarantee fair and favourable working
conditions and equitable and satisfactory
remuneration.

Forced labour and child
labour

Reject forced or involuntary labour, and respect
for children’s rights.

Diversity and inclusion

To reject all forms of discrimination.

Health and safety

Guarantee the safety of workers and
operations.

Data privacy

Make and ensure responsible use of personal
data.

Respect for communities

Establish relationships of respect and
credibility with local communities.

2.5.
Tax transparency

The Group’s commitment to tax transparency and
compliance is reflected in the FCC Tax Strategy,
which is in turn backed by an effective tax risk
identification and management system. The
purpose is to ensure compliance with applicable
regulations and coordination of best tax practices
in all Group operations. This commitments is also
reinforced by FCC voluntarily subscribing to the
Spanish Tax Agency’s Code of Best Tax Practices.

FCC Group’s Tax Strategy is defined in its Code of
Tax Conduct, which sets the policies, values and
principles that must guide the tax behaviour of
all people related to the Company, and in the Tax
Control Framework Standard and management
procedures in this area. The Board of Directors,
supported by the Groups governance bodies, is
responsible for reviewing and approval the Strategy
to guarantee compliance with tax regulations and
effective and ethical governance in all operations.

On 22 March 2023, the FCC Board of Directors
approved the FCC Group Tax Compliance Policy
with the goal of identifying, preventing, managing
and mitigating tax risks defined in the Framework
Standard, and to ensure that internal tax control
systems prevent risks from materialising.

FCC Group also has a Tax Compliance Management
System, certified in 2023 in accordance with the
UNE 19602:2019 standard. It is a comprehensive
structure of processes and procedures implemented
throughout the organisation which ensures that tax
practices are ethical, efficient and aligned with the
FCC Group business objectives and commitment
to tax transparency and sustainable development.

The System is implemented and supervised by
the Tax Compliance Body, which is comprised of
members of the Group’s corporate Tax Department
and must report to the FCC Group CEO, Audit
Committee and Compliance Committee. It is also
responsible for identifying tax risks inherent to
the Group, classifying and prioritising them, and
proposing prevention or mitigation measures.

To ensure transparency and compliance with best
tax practice standards, FCC Group submits its Tax
Transparency Report to the Tax Agency each year,
making information on global tax contribution by
country available to stakeholders. Moreover, the
FCC Group Whistleblowing Channel allows any
person or counterparty legally linked with the
Company to notify their concerns related with
possible unethical or illegal conducts, irregularities,
illegal actions or non-compliance with any regulation
or Group tax policy.

FCC. Annual Report 2023

Tax Compliance Management System

Tax
Compliance
Policy

Manuals with
possible tax
implications

Code
of Tax
Conduct

General and
specific tax
procedures by
type of tax

Tax Control
Framework
Standard

Regulations
of the Tax
Compliance
Body

2.6.
Cybersecurity
and data protection

FCC Group has a Cybersecurity Model that
encompasses the principles and minimum
requirements for the evolution of current
information systems in order to ensure the
confidentiality, integrity and availability of Company
information.

relating to the promotion of a cybersecurity culture
at all levels of the organisation, risk and threat
analyses to implement and prioritise measures,
and the monitoring, supervision and follow-up of
the cybersecurity status to guarantee regulatory
compliance.

Protecting the organisation’s information assets,
as well as guaranteeing the privacy, integrity and
availability of data, is essential in order to comply
with current regulations and avoid cybersecurity
and data protection risks.

In 2023, FCC Group developed the cybersecurity
governance model and reinforced security
monitoring systems in accordance with technology
changes and to address emerging threats.
Cross-cutting initiatives have been implemented

Continuous information to employees on the use
of technology is key in developing this Model.
For this reason, 10,000 training actions in
cybersecurity, data protection and the use of
technology were conducted in 2023.

Principles for guaranteeing information and data security and protection

Guarantee transparency and trust at all times
regarding the secure processing of personal
data.

Undertake responsibility and commitment in
the use of personal data, based primarily on
data confidentiality.

Ensure information integrity to prevent
unauthorised manipulation.

Efficiently manage the security of personal
data processed at FCC Group.

Ensure personal data are available when
necessary, allowing access only to those
necessary as part of their duties.

The FCC Group’s Risk Management Model | Page 1 of 4

3. The
FCC Group’s Risk
Management Model

The FCC Group is exposed to various risk factors
inherent to its activities and related to the
environmental, economic, social and geopolitical
evolution in the different countries where those
activities are carried out. Many of these risk factors
are interconnected and could potentially affect the
sustainable growth of the Group, although they
also represent opportunities in the context of the
United Nations SDGs (Sustainable Development
Goals).

In response to this environment, the FCC Group
has developed a Risk Management Model and a
Compliance Model aligned with its strategy, culture
and values and integrated with the operations of
the various business lines. These models establish
integral frameworks for identifying, evaluating,
managing, monitoring and supervising risks,
establishing responsibilities at different levels of
the organisation.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportStrategyand objectivesRisk processingMonitoring, supervision and communicationCULTUREVALUESSUSTAINABLE GROWTHGeopoliticaland social contextEnvironmentalEconomic outlookAnalysis of the economic, social, environmental and geopolitical context and alignment of FCC Group culture and values with its strategy and objectives, are the keys to sustainable growthIdentification, analysis and assessment of risk5_

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The FCC Group’s Risk Management Model | Page 2 of 4

3.1.
Key roles for
risk management

The Risk Management Model is interlocked with
the FCC Group’s corporate governance model,
in which functions, powers and responsibilities
are assigned both at corporate level and in each
of the business units, so that they function in a
coordinated way to boost their effectiveness and
consolidate the control environment.

In this regard, the Risk Management Model is
defined and approved by the Board of Directors,
looking out for the creation and protection of value
and the interests of stakeholders.

The Audit and Control Committee is ultimately
responsible for supervising the Risk Management
Model and the internal control of the company,
receiving reporting from various functions in
the organisation, including Risk Management,
Compliance and Internal Audit acting as the last
layer of control.

The Model is implanted and developed by the
management, which establishes organisational
structures, assigns specific responsibilities for
operational management, support and supervision
and defines reporting lines with a view to attaining
the objectives of the FCC Group.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 2023FIRST LEVELSECOND LEVELTHIRD LEVELOperational management, application of checks and reporting risks on transactions and projectsSupport and control teams run by Management, responsible for overseeing the effective monitoring and checking of risks and ensuring they are managed in accordance with the risk appetiteCorporate functions with responsibility for supervision, including the Compliance and corporate Risk Management functionsInternal Audit function as last control layerBoard of DirectorsAuditand ControlCommittee FCC GroupManagement1_
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The FCC Group’s Risk Management Model | Page 3 of 4

Significant risk scenarios

Operational Risks

Deterioration of the economic environment.

Geopolitical and regulatory instability.

Deviations in sustainable objective
achievement.

Climate change.

Impairment of reputation.

Technological disruption.

Risks associated with bidding process.

Damage to the environment.

Contractual disputes.

Difficulty to attract and retain talent.

Investment property price fluctuation.

Price volatility.

Cyber threats.

Response plans

Monitoring and analysis of changes in the
environs.

Consolidation of the diversified international
position as a provider of services classified
as essential.

Maintaining market share in mature markets.

Analysis of opportunities in countries with
a stable political-social situation.

Search for new public-private collaboration
formulas to develop the end-to-end
water cycle, environmental services and
infrastructure.

Sustainable finance taxonomy area.

Integrating the businesses into the circular
and low-carbon economy and alignment with
the SDGs.

Development of the Sustainability Policy.

Development of the Environmental

Investment in R+D+i projects.

Formal economic and technical, and
contractual management planning systems
with clients and third parties, applying an
active negotiation policy.

Application of purchasing procedures,
monitoring key suppliers and periodic
analysis of deviations.

Inclusion of price review mechanisms
in contracts.

Monitoring plans for specific project risks.

Monitoring of contractual requirements
in project management plans.

Appropriate insurance coverage.

Training, coordination and development
of human resources.

Periodic valuations of real estate assets
by independent experts.

Operational unit and information security
management system.

Strategic Risks1.1_
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The FCC Group’s Risk Management Model | Page 4 of 4

Significant risk scenarios (continued)

Discrepancies in regulatory compliance.

Potential breach of the Code of Ethics and
Conduct.

Response plans

Update programmes in different regulatory
areas.

Structured, formalised and periodically
reviewed Compliance Model.

Regulated systems with detailed procedures.

Quality management systems, environmental
management and occupational risk
prevention in accordance with international
standards.

Widely disseminated Code of Ethics and
Conduct.

Organisational structure of compliance
at different levels and for the different
businesses, coordinated by the Compliance
Committee.

Training programmes on ethics in the
Compliance, Equality and Diversity schools
of Campus FCC.

Financial Risks

Credit risk.

Liquidity risk.

Limitation on access to financial markets.

Impairment of goodwill.

Exchange rate fluctuation.

Recoverability of deferred tax assets.

Interest rate fluctuation.

Response plans

Continuously monitoring the credit quality
of clients, liquidity lines and financing.

Strengthening the financial and equity
structure to improve the balance between
own and third-party funds.

Optimisation of floating-rate debt exposure
and analysis of hedging instruments on
interest rate fluctuations.

Control of asset risk management and
updating and monitoring goodwill values
and deferred tax assets.

Compliance Risks3.24

1. Mission, vision and values _ 25

2. Strengths of the business _ 28

3. Sustainability in action _ 31

4. Response to future challenges _ 48

3Strategy and value creation1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 20235_

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Mission, vision and values | Page 1 of 3

1. Mission,
vision and values

Mission

What we do

FCC’s vision defines the future sought by the
company and gives a purpose to its action.
Therefore, all its components share the same
culture and are part of the same project: a
single FCC.

To achieve its vision, FCC develops and manages
environmental services, end-to-end water cycle
management, infrastructures, cement and
associated products and real-estate management
while maintaining the highest standards of
operating excellence and applying the strictest
ethical principles set out in the FCC Group’s
Code of Ethics and Conduct in all its regions and
activities.

For the people who belong to the company,
this Code of Ethics and Conduct represents the
highest-ranking standard in the FCC Group’s range
of policies and procedures, which strengthens the
culture of compliance and supports its long-term
value creation project.

Design, carry out and efficiently and
sustainably manage environmental services,
end-to-end water cycle management and the
construction of large infrastructure works to
improve the lives of citizens.

Vission

What we want to be

To be an international benchmark Group
in citizen services, offering global and
innovative solutions for the efficient
management of resources and improvement
of infrastructure, contributing to improving
the quality of life of citizens, and the
sustainable progress of society.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 2023Mission, vision and values | Page 2 of 3

Beyond the leadership position in the different
businesses – key in the communities of the
future and as a result of its technical and
professional capacities – FCC has established
certain inalienable conduct guidelines, which are
essential for the Group to operate successfully in a
sustainable and responsible manner. These are the
Group’s values.

These values form part of the FCC Group’s Code of
Ethics and Conduct and are intended to transmit
and instil the principles to everyone working in
the company.

WE SHARE
a common challenge: improve the
quality of life of citizens and contribute
to sustainable progress.

THERE ARE
more than 67,000 of us working
in more than 30 countries.

WE ALL FOLLOW
the same path, guided by the principles
of FCC’s Code of Ethics and Conduct.

Honesty
and respect

We want to be recognised for honest
and honourable behaviour, worthy of
the trust of collaborators, clients and
suppliers as long-term benchmark
partners.

Well-being
and development
of communities

We are aware of the value
that our services bring to
society, and we are
committed to the protection
of the environment and the
development and
wellbeing of
communities.

Our
Values

Results oriented
We pursue the improvement
and achievement of goals
to make FCC a leader
in profitability and
competitiveness.

Loyalty and
commitment

We encourage diversity, promote
professional development and
recognise merit and creativity
as a stimulus to productivity
and progress.

Rigour and
professionalism

We work with exemplarity and
a service-minded approach,
developing our ability to seek
efficient and innovative
solutions.

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Mission, vision and values | Page 3 of 3

1.1.
The FCC Group’s guiding
principles

Honesty and Respect

Loyalty and Commitment

1 We observe legislation and ethical values.

11 Our clients are the focal point.

2 Zero tolerance for bribery and corruption.

12 Health and safety are paramount.

3 We prevent money laundering and the

13 We promote diversity and fair treatment.

financing of terrorism.

4 We safeguard free competition and best

market practices.

5 We exemplify ethical conduct in the

securities market.

6 We avoid conflicts of interest.

14 We are committed to our environment.

15 We are transparent in our relations with the

community.

16 We extend our commitment to our business

partners.

Diligence and Professionalism

7 We are diligent in terms of control, reliability

and transparency.

8 We safeguard the reputation and image of

the Group.

9 We use the company’s resources and assets

efficiently and safely.

10 We oversee the ownership and confidentiality

of data and information.

FCC. Annual Report 20231_
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Strengths of the business | Page 1 of 3

2. Strengths of the business

Experience

Ethics and Integrity

Health and Safety

More than 120 years of experience,
creating value for citizens. A service
structured around specialist and quality
work by the best professionals in each
one of the FCC Group areas.

An ethical, responsible culture that
encompasses the Compliance Model,
in addition to the plans and strategies of
the FCC Group and its business lines.

Care for the maximum health, safety and
well-being of professionals, in particular
for activities that represent an added risk.

Quality and Innovation

Care for the Environment

Continuous improvement to identify,
satisfy and anticipate the needs of its
customers (internal and external) and
stakeholders.

Caring for and protecting the
environment by implementing the circular
model in the business.

2_
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at the highest level

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value creation

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Strengths of the business | Page 2 of 3

2.1.
Keys to a diversified business

Environment

End-to-end Water
Cycle Management

Infrastructure

Cement

Real Estate

Waste collection.

Street cleansing.

Treatment and recycling of municipal
waste.

Ground maintenance.

Maintenance of sewerage networks.

Treatment and recycling of industrial
waste.

Recovery of polluted soils.

Facility Management.

Municipal concessions for the
management of the end-to-end water
cycle as a public service.

Civil engineering (bridges, tunnels,
highways, railway projects, hidraulic
and maritime projects, etc.).

Infrastructure concessions under the
BOT (Build, Operate and Transfer)
model.

Non-residential construction (sports,
health and cultural infrastructures, etc.).

Residential construction.

Cement.

Trading.

Other businesses (concrete,
aggregate and mortar).

O&M services (Operation and
Maintenance of infrastructures).

EPC models (Engineering,
Procurement and Construction).

Industrial.

Concessions.

Infrastructure maintenance.

Prefabricated construction.

Cement.

Brand image.

Development and sale of real estate
products, mainly housing.

Property rental (offices, premises and
shopping centres).

Development and operation of projects
aimed at housing rental.

Land management.

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Strengths of the business | Page 3 of 3

2.2.
FCC in the world
With criterion of >5 million euros
turnover/year.

8
5

1. Germany 2. Saudi Arabia 3. Algeria 4. Australia 5. Austria 6. Canada 7. Qatar 8. Czech Republic 9. Chile 10. Colombia 11. USA 12. Egypt 13. United Arab Emirates 14. Slovakia 15. Spain 16. France 17. Georgia 18. Hungary 19. Italy 20. Libya 21. Mexico 22. Norway 23. The Netherlands 24. Peru 25. Poland 26. Portugal 27. United Kingdom 28. Romania 29. Serbia 30. Tunisia1_
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Sustainability in action | Page 1 of 17

3. Sustainability in action

The FCC Group has over a century of experience in
service provision, based on a diversified model to
promote urban and social development in order to
improve the quality of life of citizens and contribute
to sustainable progress.

In 2023, FCC Group achieved notable milestones
in sustainability and reinforced its commitment
to the United Nations Global Compact and
the contribution to the 2030 Agenda and the
Sustainable Development Goals, proposing
innovative and sustainable solutions capable of
responding to challenges, adapting management
to the environmental, social and governance
circumstances in various sectors and geographies
where the company operates.

3.1.
ESG Framework

The FCC Group Sustainability Policy, approved
by the Board of Directors, reflects the company’s
commitment to sustainable development. This
policy defines the Group’s strategic environmental,
social and governance (ESG) priorities including the
reduction of emissions, protection of biodiversity,
occupational safety, equal opportunities and
corporate good governance. The Policy also
sets a framework for dialogue with stakeholders
and the response to society’s expectations in
order to contribute to a more sustainable future

for the planet and the communities where the
organisation operates.

Sustainability is a priority for FCC Group, led
by the highest company’s governance bodies,
the responsibilities of which are set out in the
Sustainability Policy as follows:

The Board of Directors of FCC, which oversees
compliance with the Sustainability Policy
through its Audit and Control Committee, is
responsible for approving, monitoring and
assessing the company’s sustainability strategy
and practices.

The FCC Group Sustainability Committee,
composed of the various business areas and
corporate units, is responsible for implementing
the Policy and the common strategy.

The Sustainability Committees of each area
are responsible for developing, implementing
and overseeing compliance with the Policy in
its business unit and the deployment of its own
strategy.

The Compliance and Sustainability Department,
part of the General Secretariat, is responsible
for, inter alia, the results monitoring system,
the identification of associated risks and
coordination of the FCC Group’s Sustainability
Committee.

A1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023Sustainability in action | Page 2 of 17

ESG Strategies

FCC Group Priorities

Topic grouping, prioritising them according to
the ESRS.

Material dimensions and issues
identified:

In 2023, FCC Group conducted a double
materiality assessment as provided in the new
European Sustainability Reporting Standards
(ESRS), thus being able to identify how company
activities impact stakeholders and the environment
and also the risks and opportunities that can
significantly influence each Group business.

The phases of the dual materiality study were:

Review and identification of impacts, risks and
opportunities aligned with ESRS requirements.

Direct query to business area departments on
ESG impacts identified and queries of the main
stakeholders: workforce, suppliers and clients.

Risk and opportunity assessment based on
financial, reputational, operational and legal
dimensions.

Consolidation of results, defining the
resulting material matters by impact and
financial materiality for the three dimensions:
environment, social and good governance.

FCC Group establishes a framework of reference in
the ESG Framework, which is the strategic guide
for managing environmental, social and good
governance initiatives and projects, contribution
to the Agenda 2030 and the Sustainable
Development Goals (SDG), and respond to national
and international commitments and standards.
Cross-cutting programmes have also been set
up to promote and integrate sustainability at
all levels of the company through innovation,
communication and creating partnerships.

The main business areas have also defined
specific sustainability strategies suitable for their
activities, thus reinforcing their management and in
line with the FCC Group sustainable development
commitment.

ESG Framework Structure

Climate action

Circular economy

Responsible use
of water resources

S Social

Human Rights

Social action

Human capital

Health and well-being

Biodiversity protection

Diversity and equal opportunities

Value chain

ESG risk management

Ethics, integrity
and compliance

T Transversal

Innovation

Communication

Partnerships

Environmental Dimension:

– Climate change and energy
– Pollution
– Water
– Biodiversity
– Resources and materials
– Waste

Social Dimension:

– Working conditions
– Health and safety
– Equality and diversity
– Data protection
– Subcontracting and suppliers
– Safety and quality of products and services

Governance Dimension:

– Integrity of conduct
– Public administrations and industry

associations

– R&D&I

From a cross-cutting perspective, the resulting
material topics were: climate change and
energy, working conditions, ethical conduct and
subcontracting and suppliers. Compared to
previous studies, this edition of the materiality
analysis also highlights relevant matters such as
pollution, biodiversity, equality and diversity, data
protection and R&D&I.

Stakeholders

FCC Group has trusting, transparency relationships
with stakeholders through constant dialogue
so we are able to understand and address their
expectations, needs and concerns using different
channels for communication, dialogue and
participation based on a transparent, honest and
truthful relationship.

FCC uses various digital channels with presence on
key social media, as well as a corporate website
and business websites that include and regularly
publish information on environmental, social and
governance performance. There is also a specific
sustainability inbox where stakeholders can
directly send any concern related to this matter.

FCC in 2023

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FCC. Annual Report 2023

Stakeholders communication and participation channels

Shareholders and investors

Clients and communities

Economic and ESG performance available
on the website www.fcc.es.

Board of Directors and Committees.

General Shareholders’ Meeting.

Shareholders Relations Office.

Investor Roadshows.

Satisfaction surveys.

Liaisons.

Dialogue channels with clients and local
communities according to the business line.

Workforce

Suppliers and contractors

One - FCC corporate intranet.

Whistleblowing Channel.

FCC360 – FCC’s app.

Dissemination and awareness-raising
campaigns.

Campus FCC.

Employee portal

We are FCC: quarterly online magazine.

We are FCC: poster.

Meetings with worker representatives.

Information and awareness-raising sessions.

Platform for supplier approval.

Respect for the FCC Group Code of Ethics and
Conduct and Anti-corruption Policy.

Commitment to applying the UN
Global Compact.

Partners

Public administrations and regulators

Agreements, sponsorships and donations.

Partnerships.

Business forums.

Publications and presentations.

Due diligence procedures.

Participation in initiatives for sector
self-regulation and legislative developments.

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Sustainability in action | Page 4 of 17

Innovation with purpose

At FCC, innovation is an essential tool to promote
operational efficiency, create a competitive edge
and commit to sustainable growth, responding
to market and stakeholder needs through
digitalisation and business transformation.

The company’s main lines of action in innovation
are:

Urban development.

Design of new sustainable products.

Process optimisation.

Technological progress for data processing.

The FCC Group innovation strategy is rolled out in
a collaborative environment, the Digital Innovation
Lab (DI_Lab), governed by a specific framework
drafted to systematise innovation initiatives.
This framework is based on the Design Thinking
methodology. Following the Group roadmap,
each business area develops its own innovation
lines of action according to the characteristics of
their sector.

An Innovation Forum was set up in 2023 with the
participation of R&D&I teams from business areas
and the DI_Lab so as to increase coordination in
innovation opportunities, share knowledge and
promote new initiatives. The Forum contributes
to efficient management, which generates greater
business, social and environmental impact, leading
to the development of new ideas, solutions and
products.

Once again we have celebrated a new edition of
Innovation Day, an annual event promoted by
the DI_Lab, presenting the main innovation and
digitalisation projects from the company’s different
business area and with participation from external
collaborators. This event promotes and fosters
innovation as an essential driving force to optimise
efficient, address digital challenges and promote
practical solutions.

projects in
development

€13,598,75

investment
in R&D&I

94%

of sustainability
projects

More than

100

professionals
involved

Sustainability in action | Page 5 of 17

3.2.
Environmental
achievements
and challenges

Environmental management

Through transparent practices and ambitious
environmental conservation and protection
goals, FCC Group not only seeks to comply
with applicable regulations but also to lead the
path towards a sustainable future based on
environmental respect. To achieve this, it has a
corporate Sustainability Policy, which sets out the
FCC lines of environmental action.

Boost climate action.

Promote the circular economy,

Manage water resources responsibly.

Maintain natural capital.

Following corporate guidelines, the businesses
have specific environmental policies in which they
undertake to prevent or, failing this, mitigate the
negative environmental impacts of their activities.
They identify the significant environmental
aspects of their operations and implement them
with certified and/or verified environmental
management systems according to leading
international standards or regulations to ensure
that appropriate operational procedures and best
available practices are implemented following

the principle of precaution. In 2023, 82.7% of FCC
activity is environmentally certified according to
the ISO 14001 standard.

To guarantee actions in accordance with the
environmental commitments, in 2023 the Group
dedicated over 260 employees and assigned
more than 100 million euros to environmental
risk prevention, investing in updating its fleet of
vehicles and machinery, in R&D&I projects for
environmental improvement or energy efficiency
measures, among others. FCC also has guarantees
in place to repair damage in the event of accidental
pollution as it has an environmental civil liability
policy, with a general civil liability policy and
additional coverage for some businesses.

Climate action

FCC Group adheres to the fight against climate
change by implementing environmentally friendly
actions and measures aiming to minimise its
carbon footprint, mitigate the negative climate
impacts of its activity and lead the transition
toward a low-carbon emissions economy. Loyal
to this commitment, FCC has a 2050 Climate
Change Strategy with long-term goals for the
Group to address the fight against climate
change. The different business perspectives
are compiled in a single document marking the
path towards reducing carbon footprint and
adapting to climate change. At the same time,
each business works on defining its own actions,
objectives and metrics according to the specific
characteristics and needs of their activity, also
defining their commitments and strategies for
carbon neutrality.

82.7%

activity with
environmental
certification

More than

€100
million
in preventing
environmental
risks

The Group’s strategic approach is based on
studying opportunities and climate risks that can
have a significant impact for FCC, taking into
account the organisation’s diverse activities, in
various sectors and geographical areas, which
entails the presence of multiple climate change
threats.

Climate change-related impacts are included in
the Risk Management Model with a procedure for
the identification, assessment and prioritisation
of climate-related risks and opportunities based

on Task Force on Climate-related Financial
Disclosures (TCFD) recommendations and
reviewed in 2023. This is a comprehensive
methodology applicable to all FCC Group
companies and activities around the world; it
enables us to understand the level of importance
or materiality of all climate risks and opportunities
identified. As a result of the analysis in 2023, FCC
has identified the priority climate physical risks,
transition risks and opportunities in all its activities
and where it must focus its efforts.

As additional proof of its commitment to climate
action, FCC Group voluntarily reports each year
to the Carbon Disclosure Project (CDP) with
information on climate risks and opportunities,
its strategic approach, action plans and progress
achieved.

Measures to adapt to climate change: adaptation
of infrastructure, facilities, processes and
materials; development of procedures to protect
employees and use of action protocols in extreme
climate events.

Greenhouse gas emissions

The Group’s annual carbon footprint calculation
is a necessary requirement to ensure compliance
with greenhouse gas (GHG) emission reduction
commitments and the definition of suitable
improvement strategies. Following GHG
Protocol criteria and methodologies endorsed
by the Spanish Climate Change Office (OECC),
FCC Group evaluates and analyses its overall
annual results through its businesses. Measuring
the carbon footprint each year provides evidence
of the organisation’s efforts in the fight against
climate change, with 8.1% fewer GHG emissions in
2023 compared to the previous year.

32.5%

consumption of
renewable energy

8.1%

less GHG
emissions

Measures to reduce carbon footprint: electric
vehicles and machinery, energy recovery from
waste, use of renewable energies, use of efficient
lighting systems, promotion of low-emission
mobility and efficient driving, optimisation of fuel
use, use of alternative fuels and installation of
climate control systems with refrigerant gases with
lower heating potential.

Energía

Energy consumption accounts for most of
FCC Group’s carbon footprint. The main GHG
emissions come from using energy from direct
sources, which require fuel to operate, and indirect
sources, which mainly consume electricity.
Throughout 2023, total energy consumption was
1.5% less than the previous year.

Moreover, in line with its environmental
commitments, FCC Group remains committed to
consuming energy from renewable sources, which
represented 32.5% of total energy consumed in
2023, proving that the company is improving in the
use of green energies.

Energy efficiency measures: maintenance
of energy management systems certified
according to the ISO 50001 standard, increased
consumption of renewable energies, maintenance
and replacement of equipment and machinery,
electrification of the vehicle fleet, monitoring
consumption, installation of LED lights, energy
optimisation of processes and installations,
efficient climate control systems and workforce
training.

FCC Group’s Carbon Footprint (tCO2e)

Direct and indirect energy consumption (GJ)

Consumption of energy from renewable sources (GJ)

Indirect GHG emissions (Scope 2)

Direct GHG emissions (Scope 1)

549,838

630,050

514,089

6,624,839

6,507,988

6,045,270

45,962,587

49,351,838

48,616,449

14,766,007

15,783,674

13,029,179

2021

2022

2023

2021

2022

2023

2021

2022

2023

Sustainability in action | Page 7 of 17

Pollution

FCC Group identifies the main sources of pollution
in its operations, defining actions and measures
to prevent or mitigate the possible contribution
to associated environmental impacts. The
Group must control its activities that produce
atmospheric pollution due to NOx, SOx, particles
and other pollutant gases, to water and land
caused by accidental spills and discharges, light
pollution due to light emissions or noise pollution
by generating noise and vibrations.

Measures to reduce atmospheric pollution: monitoring and control of emissions
with sensors; use of low-emission vehicles; optimisation of routes and speed control;
use of renewable energies; design of action plants for accidental situations; irrigation
of paths, paving and dust control; maintenance and renewal of machinery; use of
emission limitation techniques; installation of hoods and filters; and efficient climate
control systems.

Measures to control spills and discharges: definition of discharge control and
monitoring procedures; development of emergency plans; analytical control of
discharges and control of concentrations; rainwater collection and channelling
system layout; installation of process water and leachate purification and treatment
systems or sending to authorised managers; recirculation or reuse of greywater;
proper storage of chemical products and hazardous waste; and availability of spill
retention systems.

Measures to prevent noise and light pollution: use of electric vehicles and
machinery; equipment maintenance; installation of acoustic isolation, screens,
barriers or closures; use of sensors and respectful lighting systems; adapting
activities hours; and employee training and awareness.

Emissions of the main atmospheric pollutants (t)

Volume in water discharges (m3)

Volume of significant spills (m3)

2021

2022

2023

NOx

SOx

Particulates

1,237
1,501
1,702

618
438
600

10,395
10,316

13,904

4,161,737

3,538,625

4,048,923

2021

2022

2023

2021

2022

2023

Water

Biodiversity and ecosystems

The growing concern for water shortage makes
responsible water resource management a
cornerstone for mitigating the adverse effects of
the lack of water and promoting sustainable use.
In this context and considering it is an essential
resource for its activities and for society in general,
FCC Group promotes the responsible use of
water and is working to provide solutions for water
shortage and stress.

Within FCC Group, the Water Area plays a
fundamental role in end-to-end water resource
management. Through its activity, the company
undertakes to optimise the use of this resource,
both public and private, so as to favour sustainable
community development. However, controlling
water consumption is of vital relevance for all
business areas, which work to mitigate the adverse
impacts of intensive-consumption activities.

Measures for responsible water management:
distribution network maintenance; use of
efficient and water-economising technologies,
equipment and devices; monitoring and control of
consumption and losses; process optimisation;
recirculation and reuse of process effluents,
wastewater and rain water; and workforce

FCC Group acknowledges the urgent need
to address the protection of biodiversity and
ecosystems. Aware that company operations
may generate impacts in natural systems, FCC is
strongly committed to the conservation of natural
capital and the recovery of affected ecosystems.

Progress improvement of results over the years
is notable, reflecting the company’s ongoing
commitment to the constant search for actions
and measures to mitigate negative impacts on
biodiversity. Proof is the increase in hectares
protected and spaces restored in 2023 by 170%
compared to the previous year.

FCC is also concerned with finding out the footprint
of its activities in sensitive areas, in other words,
areas with ecosystems that require additional
attention. Conserving them is fundamental to
ensure sustainable biodiversity management and
to safeguard ecosystem integrity. The Group also
strives to monitor well-being and guarantee the
conservation of any vulnerable species present
in spaces occupied by FCC facilities or in their
surrounding areas.

More than

8,500 ha

protected areas
and spaces
restored

Measures to protect and care for biodiversity
and ecosystems: use of low-toxicity products;
implementation of end-to-end pest management
systems; encouraging wildlife in urban
environments; protection of native species and
prevention of invasive species; replanting and
restoring affected areas; implementation of
deterrent techniques to prevent opportunistic
species; impact studies; biodiversity, control and
accident log plans; delimitation of sensitive areas;
use of existing paths; planning projects according
to species lifecycles; transfer of species; and
participation in projects with nature protection
associations.

Measures taken to preserve or restore biodiversity

Protection of vulnerable areas (ha)

Restoration of affected areas (ha)

2021

1,237

940

2022

1,854

1,364

2023

5,536

3,156

Water abstraction (m3)

14,406,904

14,233,686

14,895,772

2021

2022

2023

Data for the Water Area’s self-consumption are not
included as this is considered residual consumption.

Circular economy
and use of resources

FCC recognises the importance of responsible and
efficient resource management, both in terms of
raw material and resource consumption and waste
generation and management, so as to guarantee
a sustainable future. It therefore implements
circular practices for long-term success, playing
a leading role in the transition towards a circular
economy and the fight against resource shortage.

This commitment comes to fruition by integrating
the principles of circularity in the businesses,
highlighting adhesion to several areas of the
Spanish Pact for a Circular Economy.

On one hand, responsible and effective
waste management by developing exemplary
practices is crucial to reduce pollution, preserve
natural resources and mitigate climate change.
An approach that contributes to preserving
ecosystems, protecting biodiversity and preventing
possible risks for human health.

Within the Group, the Environmental Services
Area plays a leading role in the transition toward
a circular economy. It has a positive impact in
the circular model with its waste collection,
recycling and recovery services, contributing to
end product lifecycles by processing the urban and
industrial waste it manages. The Area also brings
an innovative approach based on the search for
circular solutions by optimising its processes and
identifying more sustainable alternatives in its
activities.

As for Group data, in 2023 hazardous waste was
reduced by 42% although there was a significant
increase in non-hazardous waste as a result of the
increased number of demolition work and changes
stemming from Law 7/2022. However, over 84%
of waste generated was managed by different
elimination processes.

Total waste generated (t)

42%

reduction
in hazardous
waste

18,255,930

2,506,693

2,869,648

2021

2022

2023

Transition towards a circular economy measures:
minimisation of waste for elimination; waste
recovery; optimisation of processes to obtain
by-products; use of secondary raw materials;
production and use of biofuels; development of
R&D&I projects; use of recoverable elements;
recovery and reuse of process elements;
generation of energy from waste; use of alternative
fuel sources; alternative use of resources; proper
waste separation and promotion of responsible
resource use.

Measures for responsible waste management:
implementation of waste minimisation plans;
waste recovery; reuse of process waste;
acquisition of vehicles with recoverable elements;
reuse of sludge for compost and organic fertilisers;
commitment to reusable packaging; reduction
in the use of materials that generate hazardous
waste; adequate design of waste storage facilities;
promotion of good separation practices and
workforce awareness campaigns.

Measures for sustainable resource use:
monitoring and control of consumption; reduction
in the use of non-renewable natural resources;
use of recycled materials, recovered waste and
alternative materials; use of waste as a fuel;
commitment to reusable materials; preference for
products with returnable packaging; reuse of waste
generated by activities; protocols for efficient
product use and employee awareness.

Sustainability in action | Page 10 of 17

On the other hand, FCC’s firm commitment to
efficient resource consumption and conscious
use of raw materials, intermediate and end
products, and the end of their lifecycle is evidenced
by efforts to optimise processes, minimise waste
and maximise the value of products throughout
their lifecycle. These principles are incorporated
into Group activities to generate positive impacts
through various actions.

In 2023, there was a 5% increase is resource
consumption compared to the previous year,
emphasising the rise in the use of semi-processed
products as a result of activities developed by the
Infrastructure Area that required greater concrete
consumption.

Total materials used (t)

59,326,193

20,155,598

21,162,259

2021

2022

2023

3.3.
Human commitment

FCC Group continues to reinforce the fundamental
pillars of its lines of action listed in its
Sustainability Policy based on talent management;
promoting diversity, equality and inclusion; and
promoting the health and well-being of people
in order to improve its services and professional
teams, for social and labour development where it
operates and quality of life.

The best teams

FCC maintains its upward trend, reaching
67,000 employees in 2023, spread around and
working in 38 countries worldwide. One of the main
characteristics that defines the company is its
stable employment. This year, 84% of employees
have a permanent contract and 88% full-time
hours.

Distribution of the workforce by geographical area

USA
and Canada

1.95%

Rest of EU
18.88%

Spain
72.42%

Latin
America

2.93%

Rest of
the world

3.82%

22.5%

women

77.5%

men

Distribution of the workforce by gender and functional level

New hires by gender and functional level

Governance and Management

Supervisors

Technicians

Administrative staff

Other trades

Subtotal

Total

Hombre

428

3,900

4,767

897

42,024

52,016

Mujer

912

2,288

2,084

9,711

2022

2023

Hombre

Mujer

Total Hombre

Mujer

Total

Governance and Management

Supervisors

Technicians

Administrative staff

282

780

123

360

309

350

583

1,140

1,733

432

178

165

719

317

748

2,452

495

15,074

Other trades

10,032

2,876

12,908

10,822

2,785

13,607

67,090

Total

11,231

3,616

14,847

13,331

3,991

17,322

It is worth noting that, in 2023, the number of women in
the functional Supervisors level, previously executives and
pre-executives, rose by 10.55%.

Likewise, in 2023 the number of female hires grew at practically
all functional levels compared to the previous year.

Sustainability in action | Page 12 of 17

Salary policy

FCC remunerates its employees according to
sector competitiveness and geographic, internal
equality and level of responsibility criteria.

FCC operates in diverse productive sectors
in 38 countries and employee remuneration
is generally subject to applicable collective
bargaining agreements (in the case of Spain, more
than 900 agreements of different scopes in 2023).

FCC Group wage gap

FCC’s remuneration management is based on
criteria of objectivity, external competitiveness and
internal equality. FCC does not differentiate by
gender, so remuneration is equal based on level of
contribution to the business (functional level) and
the responsibility and value of each position.

Two rates, gross and adjusted, are considered
to calculate the wage gap at FCC Group. The
following figure shows the results obtained in
2023:

In any case, the percentage difference does
not imply that there is gender-based pay
discrimination as there are other factors outside
the company’s scope of action which significantly
contribute to increasing gender pay inequality.
These include masculinisation in most sectors
where the Group operates, working conditions
from cases of subrogation, individual performance,
economic crises, political situation, sociocultural
reasons, education or experience in the job.

Training and development

Training and development of FCC teams and
professionals is essential in talent management
and to respond to the needs and challenges of all
the company’s different businesses. With annual
training plans, cross-departmental and by area of
activity, we offer mandatory and voluntary training
in different subjects which, in 2023, included the
following initiatives:

Digitalisation and data management

FCC has an information and data analysis tool
and platform, the Data Boutique, which this
year has continued to advance in the creation of
reports, specifically on absenteeism, training, total
remuneration and forecasting new costs linked to
contributions.

Training linked to the Compliance Model, related
to Conflicts of Interest, the Tax Compliance
System and international dissemination of the
FCC Group Code of Ethics and Conduct.

Programmes on digitalisation and
cybersecurity, promoting adaptation and digital
transformation with seminars, monographs
and training in technologies, processes and
innovation.

Training actions to promote diversity, equality
and inclusion, working on the following
issues: inclusive leadership, unconscious
biases, integration of the gender perspective in
occupational risk prevention, inclusive language,
awareness of non-discrimination, gender
violence, cyber harassment and processing and
investigating cases of harassment.

2.79%

adjusted wage gap

19.15%

gross wage gap

Calculated considering aspects that compare men
and women in a similar situation, such as gender,
functional level, seniority, applicable collective
bargaining agreement, etc.

Calculated by obtaining the percentage different
between total median salary of men and women.

Health and safety workshops focused on mental
well-being, digital stress and physical and
mental loads.

Programmes designed for the development of
young talent, female leadership and people
management.

Specialisation in various areas of technical
knowledge, such as the BIM (Building
Information Modelling) methodology.

Over 700,000 training hours in different areas
of the FCC Group business were given in 2023,
aiming at all organisational levels and of the
company and covering various areas of technical
knowledge, health and safety, skills, languages
and on diversity and compliance, etc. Specifically,
from Campus FCC, the Group e-learning platform
with training content in 14 languages, 112 training
actions were offered in over 470 calls.

Diversity and equality

On 28 November 2023, the FCC Group Board
of Directors approved the Equal Opportunities
and Safe Environments, Diversity and Inclusion
Policy, thus reinforcing the commitment by the
company and all FCC employees to diverse, equal
and inclusive work environments based on respect,
free from any form of discrimination, harassment,
intolerance or violence.

For FCC the principle of equal opportunities is a
commitment to action that cannot be waived, set
out in the FCC Group Code of Ethics and Conduct.
Thanks to permanent social dialogue and the
common interest in guaranteeing equal treatment
and opportunities for women and men, FCC Group
has 14 Equality Plans —five of which are Group
plans— and five Equality in Business distinctions,
sign of excellence in equality granted by the
competent authority in Spain to FCC’s main parent
companies.

This year we have continued to promote various
initiatives and new actions that consolidate and
reinforce the company’s commitment to diversity,
equality, inclusion and the fight against gender
violence, mostly notably:

Publication of the FCC Group Inclusive
Communication Guide, launched with a
training clip.

Seminar on Inclusive Leadership for FCC Group
executive staff.

Renewal of the Diversity Charter 2023-2025.

Participation in the Development Programme
for Management – Women with High Potential
by EOI (School of Industrial Organisation).

Participation in the Promociona Project by CEOE
(Spanish Federation of Business Organisations)
and ESADE (Higher School of Business
Administration and Management).

Pablo Colio, FCC Group CEO, inaugurates the Inclusive Leadership
Seminar at the FCC Headquarters in Las Tablas (Madrid, Spain).

Event to mark International Day for the Elimination of Violence against Women, held in Madrid (Spain).

As part of the fight against gender violence,
a training clip was launched entitled “Cycle
of Gender Violence and Support Networks”
and, once again, a seminar was held to raise
awareness with FCC granting an award to the
Security Forces (National Police, Civil Guard and
Local Police of Madrid) in recognition of their
work.

Under the Group’s commitment to prevent
workplace harassment and guarantee
respectful work environments, in 2023 an
initiative was launched to raise awareness on
Cyberharassment for staff with no access to
information systems by means of campaigns at
different work centres.

In terms of accessibility, the FCC headquarters
received UNE 170001-2:2007 Universal
Accessibility Certification, which accredits
access and universally accessible services.

FCC received the Charity Award by Grupo Social
ONCE Region of Madrid in the business category
for promoting social projects aimed at reducing
aspects such as inequality and the risk of social
exclusion.

Additionally, in 2023, the FCC space for the
equality, diversity and inclusion of its workforce,
you_diversity, received the award for best
internal communication practice granted by the
Internal Communication and Corporate Identity
Observatory.

In 2023, the number of employees with an
accredited disability at FCC Group was 2,204. This
number has increased for the third year in Spain.

Moreover, in 2023 FCC Group took part in different
initiatives with organisations that promote safe,
respectful and inclusive work environments such
as REDI, the Business Association for LGTBI
Diversity and Inclusion.

Evolution of workers with disabilities in Spain

2023

2022

2021

2020

Isidoro Valverde and Sonia Serrano from the FCC Group
Labour Relations and Equality department collect the
award for the best internal communication practice in
sustainability for the you_diversity project.

2,019

1,860

1,498

1,440

Health, safety and well-being

The FCC principles of action are based on the
real and effective integration of health and safety
in all its decisions and activities, involving its
network of partners, contractors and suppliers in
the preventive culture and ensuring a system of
continuous improvement of working conditions
that considers the most stringent safety standards,
such as the ISO 45001 standard. In this line, road
safety management systems were implemented in
2023 and FCC received ISO 39001 certification in
sensitive activities such as road maintenance and
urban sanitation in Madrid.

Evolution of the main rates

Workplace accidents with sick leave and
occupational accident rates have dropped from
the previous year with a Global accident frequency
rate of 18.82 in 2023 and a Severity rate of 0.87.
Therefore, these markers were once again below
the equivalent indices published by the Ministry
of Labour and Social Economy in every sector of
activity.

Gender perspective in health and safety
management

As part of our continuous improvement to
integrate gender perspective in health and safety
management, in 2023 the work was carried out on
two main lines of actions focusing on specialised
training for occupational risk prevention staff and
occupational health and safety managers, and the
creation of a specific working group to work on
absenteeism and health indicators broken down by

gender, specific preventive measures for women in
traditionally male activities and promoting health
with gender perspective.

Promoting personal health and
well-being

As regards the promotion of health and well-being,
in 2023 mental and emotional well-being
actions were implemented, progress made in
the assessment of psycho-social risks and we
have continued to develop health promotion
programmes with campaigns on healthy eating
and taking part in sports leagues and events. Also,
various work centres obtained heart and brain
protected space certification.

Likewise, to better disseminate content, resources
and programmes to promote health habits among
the workforce, LIVE Healthy platform was set up
as a web space also available on a mobile app.

As part of their duty to protect and improve
employee health, as well as prevent and detect
pathologies with medical check-ups and health
monitoring, this year the FCC Medical Services
have focused their efforts on the prevention of
cardiovascular risks and the fight against smoking
and obesity.

Heart Race, Madrid (Spain).

Organisational culture

FCC Group considers proper work time
organisation management to be essential, creating
a quality and well-being work environment based
on the personal and professional development
of workers and providing measures for work-
life balance, flexibility, joint responsibility,
disconnection and social benefits appropriate to
the different organisation and production realities
and needs of each centre, function or activity.
These include:

Flexibility in working hours and holiday periods,
in addition to continuous working hours during
the summer and on Fridays.

Improving leave for sickness and/or
bereavements and to deal with personal or
family circumstances.

Extending leave for breastfeeding, reduced
working hours and unpaid leave with guaranteed
return to the job.

Complements for maternity and paternity,
disability, temporary disability, hospitalisation,
etc.

Collective workplace accident insurance and
compensation for death or permanent, total or
absolute disability.

Rewards for retirement, marriage and birth.

Special prices on goods and services via the
FCC Club.

Moreover, in accordance with the Policy on the
Use of Technological Equipment, work continues
to promote and guarantee workers’ right to
digital disconnect depending on the nature and
characteristics of the job.

A2_
Sustainability
Report

FCC. Annual Report 2023

More than

€5.5 million

on social
action

Creating value

Knowledge

Promoting a positive socioeconomic impact for
community development and environmental
protection, as well as fostering job creation and
contracting local suppliers.

Cooperating with community education and
awareness initiatives that promote social
development and progress, and supporting the
generations of tomorrow.

Integration

Solidarity

Favouring the transformation of cities into
inclusive spaces thanks to awareness-raising
actions and support, as well as social and labour
integration of those who are vulnerable or at risk
of exclusion.

Participating in programmes and campaigns
in partnership with associations, foundations
and entities from the tertiary sector and making
donations to improve the lives of people.

Sustainability in action | Page 16 of 17

3.4.
Transforming
communities

Community well-being and satisfaction are
fundamental for FCC Group; interaction and
creating solid relationships are a priority to
generate a significant and positive impact on the
social, economic and environmental surroundings.

As part of FCC’s commitment to fostering
community well-being and promoting
socioeconomic development where it operates, the
company makes its social contribution a reality
with different lines of action based on the creation
of value, knowledge, integration and charity action.

In 2023, FCC assigned more than 5.5 million euros
to sponsorships and donations to the non-profit
organisation, foundations and sector associations
it collaborates with according to objective criteria,
as well as financial contributions and support for
social action.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business lines

Sustainability in action | Page 17 of 17

3.5.
Clients and suppliers

As part of its commitment to sustainability,
interaction with the value chain plays a vital role
for FCC, with a focus on creating and maintaining
solid relationships based on trust and honesty,
strengthening them by ensuring maximum quality
in products and services, setting up effective
tools for dialogue and implementing due diligence
processes in the supply chain.

As provided in the Code of Ethics and Conduct,
FCC Group puts clients at the centre of its
activity, working to ensure maximum excellence
and generate differential value in the provision
of products and services that respond to
clients’ needs.

46,102

suppliers

FCC has a continuous process of listening,
learning and adaptation to address clients’
expectation and respond to their demands and
needs. Procedures to guarantee privacy and
safeguard health and safety of clients and end
users with a specific assessment of practically
all products and services. Furthermore, another
priority for the company is quality management
system certification such as ISO 9001, which
promotes rigorous compliance with applicable
regulations and quality standards, reinforcing
FCC’s commitment to excellence.

Supplier management has a leading position in
the FCC Group value chain, adopting strategies
to ensure the selection of and collaboration with
responsible, efficient, ethical and sustainable
commercial partners, to guarantee exemplary
business conduct and establish transparent
relationships with suppliers and contractors based
on transparency and trust.

FCC Group has a relationship with 46,102 suppliers
mainly in Spain but also spread around various
countries worldwide. In addition to geographic
diversification, there are different types of suppliers
that vary according to the business area, so as
to adapt the supply chain to specific needs and
respond to the wide variety of company operations.

In order to ensure FCC’s commitment to
responsible and sustainable commercial
relationships, FCC uses various tools for
commercial partners to align and prove
compliance with the social, ethical and
environmental standards set by the company. This
commitments starts with an integrated framework
based on:

To guarantee supply chain integrity and
sustainability, FCC has implemented a thorough
due diligence process for supplier approval and
assessment in line with ethical, economic, social,
labour and environmental standards set by the
company to initiate and maintain contractual
relationships. This process requires:

The FCC Group Code of Ethics and Conduct and
supplier and contractor adhesion to fundamental
principles of compliance with legislation and
ethical practices against corruption, bribery and
fraud; express respect for fundamental human
and labour rights; respect for the environment,
minimisation of environmental impacts and
implementation of sustainable environmental
management.

The Purchasing Manual based on the principles
of competitiveness, transparency and objectivity,
which includes the fundamental principles of the
procurement model, responsibilities and duties, as
well as processes to follow so as to comply with
internal regulations.

The General Contracting Conditions, which
regulate trade and commercial partner
relationships, setting the terms and conditions
for contracting, mandatory ethical clauses
and sustainability aspects that suppliers and
contractors must accept and meet during the term
of the contract.

Signing a Statement of Compliance on respect
for human rights and the fight against corruption
and conflicts of interest, among other ethical
commitments.

Reporting information related to necessary
issues and requirements on different
areas: financial information; environmental
performance; occupational health and risk
prevention; labour, workforce and discrimination
management; compliance model and criminal
prevention; information security and data
protection measures and systems, as well as
reporting other operational details for product
and service provision.

Suppliers are assessed according to the
information received and classified based on their
level of risk. An approval certificate is issued with
a rating of A, B, C or D, the latter classified as high
risk, requiring a specific due diligence process.
FCC also conducts regular assessments and
surveys to maintain and complete the approval
process and reinforce supply chain supervision.

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4. Response to future challenges

With the aim of improving citizens’ life, the
FCC Group has succeeded in becoming an
international reference in Europe, Latin America,
the USA, the Middle East and North Africa in
the area of provision of public services and
development of infrastructure.

With net revenues of €9.026 billion in 2023, 17.1%
more than in 2021, the Group has demonstrated
the good financial performance of its various lines
of business:

These figures reflect FCC’s ability successfully
to face the challenges presented by a dynamic
environment, contributing solutions of value to
society and so contributing to improving the future.

4.1.
Global trends

Climate change and water stress

Climate change is one of the most crucial
challenges facing humanity in the coming decades,
its urgency worldwide has been recognised by the
international community.

A recent report by the World Meteorological
Organization (WMO)(1) confirms that 2023 was the
warmest year on record to date with an average
near-surface temperature 1.45°C above pre-
industrial levels. Additionally, the main greenhouse
gas concentrations always experienced continuous
growth throughout 2023.

Based on projections forecast for 2027 by the
different climate models, the average global
temperature is expected to occasionally exceed
pre-industrial levels by 1.5ºC with a likelihood
of 66%.

1. State of the Global Climate 2023 (wmo.int).

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This trend leads to significant impacts, such as
increased frequency and intensity of extreme
climate events including heat waves, droughts,
flooding and storms, also the melting of pole caps
and glaciers will contribute to the rising sea level.

At the same time, water stress in certain regions is
another critical consequence of increasing global
warming. The severe drought and worrying fall in
water resources at global level in 2023 intensify
hydrological imbalances, with a projected 40%
drop in water resources available on a global scale
according to previsions of the United Nations.(2)

The planet is immersed in one of the greatest
scenarios of water stress in history. In this
context, sustainable water management is crucial,
especially in light of demographic growth and
climate changes.

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Climate change and water stress Figures

In 2023, July was the hottest month ever
recorded. Overall, the Earth was around
1.4ºC warmer in 2023 than the late 19th-
century average.(3)

According to a report by the World
Meteorological Organization, Swiss glaciers
have lost around 10% of their residual
volume in recent years. (6)

Ocean heat content reached its peak in
2022, the last full year for which data are
available in the 65 years of observational
records.(7)

According to data collected since 1993,
year in which observations by satellite were
first obtained, the average global sea level
reached an all-time high in 2023, proof
of continued warming of the oceans and
melting of glaciers and ice sheets.(8)

The rising sea level rate between 2013 and
2022 is more than double the rate recorded
between 1993 and 2002 due to continuous
warming of the oceans and melting glaciers
and polar caps.(4)

Carbon dioxide (CO2) levels are 50%
higher than in the pre-industrial era. And
because of their long lifespan, temperatures
will continue to rise for many years.
Concentrations of the three most abundant
greenhouse gases –carbon dioxide (CO2),
methane (CH4) and nitrous oxide (N2O)–
reached unprecedented levels in 2022,
the last year in which we consolidated
global figures are available. Real-time
data from certain locations indicate that
concentrations of these three gases
continued to rise in 2023.(5)

Droughts in Europe are estimated to cause
9 billion euros in damage each year. In a
context where temperatures rise 1.5°C due
to climate change, costs would skyrocket to
25 billion a year.(9)

With climate change, Spain will suffer more
frequent and extreme weather phenomena
like flooding and droughts, which will
worsen the effects of more heat waves,
greater flooding and less water security.
Southern European countries such as
Portugal, Spain and Italy already suffer
greater water stress and the situation in
Spain is expected to decline significantly by
2050.(10)

In 2022, 2.4 billion people lived in areas
exposed to, in some cases extreme, water
stress.(11)

2. Water Action Decade - Sustainable Development (un.org).

3. NASA. (2024, 12 January). NASA Analysis Confirms 2023 as
Warmest Year on Record - NASA.
4. 2023 shatters climate records, with major impacts. (2023,
28 November). World Meteorological Organization.
5. 2023 shatters climate records, with major impacts. (2023,
28 November). World Meteorological Organization.

6. 2023 shatters climate records, with major impacts. (2023,
30 November). World Meteorological Organization.
7. 2023 shatters climate records, with major impacts. (2023,
30 November). World Meteorological Organization.
8. 2023 shatters climate records, with major impacts. (2023,
30 November). World Meteorological Organization.

9. WWF; Report 2023: “Water for Nature, Water for Life”.
10. WWF; Report 2023: “Water for Nature, Water for Life”.
11. WWF; Report 2023: “Water for Nature, Water for Life”.

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The new World Bank report, “Thriving: Making
Cities Green, Resilient, and Inclusive in a Changing
Climate” (13) emphasises the vital role cities play
in improving quality of life. It also underlines their
importance in counteracting the negative effects
of climate change in critical areas like water
supply, food safety or biodiversity.

Moreover, by 2050, the urban population is
expected to rise by another 2.5 billion, which will
create greater pressure on water resources and
infrastructure.

Protecting and restoring ecosystems, such as
forests, will become essential to guarantee urban
resilience in this context. For this reason, we
must continue to focus on adapting to climate
change and on efforts to reduce risk, strengthen
capabilities to address future challenges and
build safer and more sustainable cities.

Urban development. Figures

Lack of innovation and investment to
promote greener cities will mean that global
GHG emissions will remain above the level
required to limit global warming to 1.5ºC,
even if high-income countries manage to
achieve zero net emissions by 2050.(14)

Another 2.5 billion city dwellers are expected
for 2050, which will exert greater pressure
on water resources and infrastructure and
make protecting and restoring ecosystems,
such as forests, a fundamental component
of urban resistance and water security.(15)

Demand for urban land is growing up to
50% faster than the population. From here
to 2030, the world is expected to have
1.2 million km2 more urban built-up area.(16)

The consequences of global warming
lead to significant migratory movements,
as revealed in the latest Global Report on
Internal Displacement.(17)

Cities represent two thirds of global energy
consumption and are responsible for more
than 70% of greenhouse gas
emissions.(18)

In 2022, natural disasters caused around
32.6 million forced internal displacements
(within the borders of a single country),
a number that is still higher than
displacements caused by armed conflicts
(28.3 million migrations).(19)

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Urban development

Globally, we are facing a challenged boosted by a
combination of globalisation, climate events and
economic crises that lead people to migrate from
their homes to other geographic areas.

Climate change is triggering migrations at a global
level, thus transforming urban development. And in
the future, climate dangers are expected to cause a
redistribution of populations in various parts of the
world, thus increasing pressure on urban areas.

The Synthesis Report (AR6) by the
Intergovernmental Panel on Climate Change (IPCC)
highlights that climate risks are still the main
cause of internal displacements, as demonstrated
by recent events of high-impact flooding, fires
and drought.(12) It also notes that between 3.3 and
3.6 billion people currently live in conditions that
are highly vulnerable to climate change. These
impacts threaten the lives, health, means of
survival and well-being of people around the world,
while accentuating social fragility and inequality.

12. IOM; “Key Messages to the 28th UN Climate Change
Conference of the Parties”_November23.pdf (iom.int).

13. The World Bank. Report (2023): “Thriving: Making Cities
Green, Resilient, and Inclusive in a Changing Climate”.

14. The World Bank. Report (2023): “Thriving: Making Cities
Green, Resilient, and Inclusive in a Changing Climate”.
15. The World Bank. Report (2023): “Thriving: Making Cities
Green, Resilient, and Inclusive in a Changing Climate”.
16. Urban Development Overview. The World Bank.

17. Urban Development Overview. The World Bank.
18. Urban Development Overview. The World Bank.
19. IDMC’s Global Report on Internal Displacement (GRID)
2023.

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The circular and sustainable
economy

challenges. However, although legislative progress
has been made, we are still facing considerable
challenges that require immediate attention.

The circular and sustainable economy. Figures

Achieving the circular goals set for 2030 will
require concerted and coordinated action at
all levels. Decisive measures must be taken to
reduce waste, prioritise a reduction in resource
use and improve recycling rates. From the EU and
national governments to companies and society,
all stakeholders must fully commit to the process.
Working together is fundamental to overcome
the remaining challenges and leverage the
opportunities offered by the circular economy.(22)

Our current production systems are not
sustainable. They extract more resources than
nature can replenish and release more pollutants
than nature and people can tolerate. Europe
continues to operate under a predominantly linear
model where market products normally have a
relatively short useful phase and business models
focus on mass product production. Moreover,
Europe’s strong dependence on natural resources
to provide materials, food and fuel is leading to
significant environmental degradation.(20)

The circular economy contrasts with the
“disposable” concept of the traditional economic
model(21). It represents a fundamental change in
our production and consumption models, going
beyond mere waste management. An approach
that focuses on maximising the value of resources
and minimising waste. The European Union (EU)
has implemented measures like the Circular
Economy Action Plan to facilitate the transition to
a circular economy and thus be able to address
current environmental and socioeconomic

The total quantity of materials consumed by
the world economy continues to rise; more
than half a billion tonnes of materials have
been consumed in the last six years alone.(23)

The world is only 7.2% circular(24). Only 7.2%
of material used is currently recycled and
reintroduced into the economy. This creates
a significant impact on the environment and
worsen climate, biodiversity and pollution
crises.(25)

More than 90% of materials are wasted, lost
or not available for reuse for years as they
are blocked in long-term inventories, such as
buildings and machinery.(26)

The circular economy has reached
megatrend category. The volume of
discussions, debates and articles on the
concept has almost tripled in the last five
years.(27)

In 2022, the proportion of material resources
used from recycled waste reached 11.5%.(28)

The proportion of secondary materials
consumed by the world economy has
dropped from 9.1% in 2018 to 7,2% in 2023,
a decrease of 21% in five years.(29)

Around 45% of greenhouse gases (GHGs)
come from the use and manufacture of
products, along with food production.
Applying circular economy strategies in five
key areas (cement, aluminium, steel, plastics
and food) could eliminate almost half of
world GHG emissions from the production
of goods, equivalent to 9.3 million tonnes of
CO2eq in 2050. This would be equivalent to
reducing current transport sector emissions
to zero.(30)

20. Accelerating the circular economy in Europe. State and
Outlook 2024. European Union.
21. Circular economy: definition, importance and benefits.
European Parliament.

22. The Circularity GAP Report 2024. Circular Economy
Foundation.

23. The Circularity GAP Report 2024. Circular Economy
Foundation.
24. Innovation and financing: the pillars for circular
transformation. Forética.
25. What is circular economy and why does it matter? PNUD.
26. The Circularity GAP Report 2024. Circular Economy
Foundation.
27. The Circularity GAP Report 2024. Circular Economy
Foundation.

28. EU’s circular material use rate slightly up in 2022. Eurostat.
29. The Circularity GAP Report 2024. Circular Economy
Foundation.
30. Circular economy overview 2023. European Investment
Bank.

Digital transformation, artificial
intelligence and cybersecurity

The digital transformation has revolutionised how
organisations operate and adapt to an increasingly
technological environment. This change, fostered
by developments such as artificial intelligence (AI),
redefines how we interact with information and
business processes. By providing machines with
the ability to learn and take independent decisions,
AI has become a fundamental element in this
transformation, enabling companies to optimise
their operations, anticipate trends and offer their
clients customised solutions.

On the other hand, other digitalisation processes
in process optimisation using virtual reality,
5G technology, the internet of things (IoT) and
quantum computing are tools that maximise
the potential for innovation and capacity for
companies to bring added value. Blockchain
technologies and BIM (Building Information
Modelling) ensure process traceability and improve
construction project planning. ICT technologies
(Information and Communication Technologies)
used for smart cities allow efficient natural
resource management and improve quality of life.

However, new challenges, especially in
cybersecurity, also arise with the opportunities
offered by these technologies. As organisation
adopt more advanced technologies, their
vulnerability to more sophisticated cyber
attacks increases, highlighting the importance
of protecting data and infrastructures against
constantly-evolving threats. People could use

technology to compromise corporate systems
and cause significant damage, challenging the
effectiveness of traditional security measures.

Addressing these challenges requires a
multidimensional approach involving companies,
political leaders and technology developers.
Companies must strengthen their cybersecurity
infrastructures and train staff to detect and
respond to emerging threats. Incorporating
AI in cybersecurity strategies can improve the
identification of threats and accelerate response
times. Meanwhile, political leaders have a vital
role to play in creating solid legal frameworks that
promote best cybersecurity practices and foster
international cooperate to combat cybercrime.
Developers also have the responsibility to design
sturdy systems resistant to improper use. It is
also essential to continue researching AI and
cybersecurity in order to anticipate and address
evolving threats.

The European Commission recently published a
guide to establish cybersecurity requirements in
high-risk AI systems, in line with the new Artificial
Intelligence Act that will be passed in 2024(31).
This legislation will ban certain AI applications
that infringe fundamental citizen rights and
sets clear obligations for high-risk AI systems.
These regulatory efforts are fundamental for
guaranteeing that AI is used in a responsible,
ethical way to benefit society.

In economic terms, technology applications have
a significant impact on the global market. These
technologies are expected to contribute positively
to gross domestic product (GDP) at world level.(32)

In a scenario of continuous digital transformation,
addressing security challenges that arise from
progress in artificial intelligence is essential.
Collaboration between companies, governments
and technology development communities is
fundamental to ensure a secure and sustainable
digital future.

31. EU AI Act: first regulation on artificial intelligence European
Parliament.
32. Artificial Intelligence (AI) - Statistical data. Statista.

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Digital transformation, artificial intelligence and cybersecurity. Figures

In Spain, 58% of Spanish entrepreneurs and
executives include the digital transformation
among their strategic priorities for 2023.(33)

Artificial intelligence is one of the technology
areas with greatest short and medium-term
economic projection. It could break the barrier
of 300 billion USD in 2025.(34)

Artificial intelligence is estimated to improve
the GDP of the energy industry, public services
and mining by 5.5% in terms of productivity.(35)

Just 4% of organisations are sure that users
with access to their networks and systems are
protected from cyber attacks.(36)

In 2023, a total of almost six million cyber
attacks were recorded worldwide, a 22%
increase compared with 2022.(37)

Approximately four out of ten companies
around the world state that they are not
resilient enough against sophisticated cyber
attacks. The real figure is likely to much
greater as attack methods evolve and use
artificial intelligence more and more.(38)

According to the Worldwide Security Spending
Guide published by IDC, European security
spending will grow by 12.3% in 2024, another
year strong momentum. Spending in the
region is expected to rise at a constant rate
throughout the 2022-2027 period, reaching 84
billion dollars in 2027.(39)

33. Outlook Spain 2023: Digital transformation. KPMG.
34. Artificial intelligence: global market value 2021-2030. Statista.
35. Artificial intelligence: impact on global GDP by sector 2030.
Statista.
36. State of the connected world 2023 Edition. Insight Report
January 2023. World Economic Forum.

37. Cyber Threat Report 2023. SonicWall.
38. Key strategies for building cyber resilience in 2024. World
Economic Forum.
39. State of the connected world 2023 Edition. Insight Report
January 2023. World Economic Forum.

Response to future challenges | Page 7 of 36

Protecting biodiversity

The current global situation presents a concerning
reality, the world is facing a triple planetary crisis of
which biodiversity loss is part. Despite international
efforts in recent decades to preserve biodiversity,
the continuous loss of habitats, degradation of
ecosystems and extinction of species are still a
threat for the environment and society(40). This
problem is one of the main global risks(41), requiring
urgent solutions to face climate and natural
emergencies.

The European Union has proposed and passed
different laws, such as the Nature Restoration
Law(42), in order to achieve climate and
biodiversity goals, as well as fulfil its international
commitments, particularly the Kunming-Montreal
Global Biodiversity Framework(43). This Framework
sets four objectives to be achieved for 2050 and
23 global goals for 2030 designed to protect
and restore nature, guarantee sustainable use
and encourage investments for a green world
economy. To achieve these objectives and goals,
countries must set domestic goals with national
strategies and action plans on biodiversity.
COP16 on biodiversity will be held in Colombia in
2024(44), assessing whether national objectives
are sufficient to achieve the Framework’s global
objectives and goals.

However, despite efforts made, the chronic
funding deficit for biodiversity conservation is
still a significant obstacle(45). In order to fulfil
commitments and address the biodiversity crisis,
it is essential that we adopt a comprehensive
approach combining regulatory and voluntary
measures, strengthening the use of economic
instruments and promoting private sector
involvement to multiple available resources. The
European Commission has already announced
that it will double its international funding for
biodiversity for the period between 2021 and 2027.
This European sustainable funding initiative will
contribute to guiding funding towards supporting
investments in biodiversity.(46)

For all these reasons, FCC Group acknowledges
the urgent need to address the protection of
biodiversity and ecosystems. Aware that company
operations may generate impacts in natural
systems, FCC is strongly committed to conserving
natural capital. This commitment is reflected
in the various policies, strategies and actions
of each business area, as well as the different
environmental awareness projects the company
participates in. Proof of this commitment in 2023
is the renewed adhesion of FCC Environment
Iberia to the Pact for Biodiversity of the Spanish
Business and Biodiversity Initiative (IEEB) and the
Group’s adhesion to the same pact and initiative
since 2013.

40. The Sustainable Development Goals Report 2023. United
Nations.
41. The Global Risk Report 2023: World Economic Forum.

42. New law to restore 20% of EU’s land and sea. European
Parliament.
43. Kunming-Montreal Global Biodiversity Framework. UN.
44. What is COP16 on biodiversity, to be hosted by Colombia in
2024? WWF.

45. The Sustainable Development Goals Report 2023. United
Nations.
46. Stop biodiversity loss: The EU outlines achievements one year
after adopting the global plan for nature and people. European
Commission.

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Protecting biodiversity. Figures

More than 50% of the global GDP is linked to
nature and the services it provides.

Up to one million species are threatened by
extinction and could become extinct in a few
decades.

Worldwide, at least 100 times more public
funds are assigned to subsidies that are
harmful for the environment than to funding
forests.

Up to 200 species become extinct every day.

Around 40% of the world’s population,
equivalent to 3.2 billion people, is negatively
affected by the degradation of the planet.

Since 1990, around 420 million hectares of
forest have been lost due to converting land to
other uses.

In 2023, three quarters of the planet’s land
ecosystem and around 65% of the marine
environment has been significantly altered by
human actions.

In 2023, between 100 and 300 million people
are at increased risk of suffering floods and
hurricanes because of coastal habitat loss.

Our global food system is the main reasons
for biodiversity loss and agriculture alone is
an identified threat for 24,000 of the 28,000
species at risk of extinction.

Investing in nature provides an opportunity
to generate 10 billion USD in added value and
create 395 million jobs.

FCC. Annual Report 2023

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4.2.
FCC’s response to future challenges

Environmental Services

Challenges

Actions

Attain carbon neutrality by 2050.

Implement innovative solutions to promote
the development of sustainable cities and
communities.

In order to reduce greenhouse gas emissions and achieve carbon neutrality for 2050, FCC Medio Ambiente’s
strategy includes a series of measures and actions to prevent or mitigate its contribution to environmental
impacts associated with pollution. These measures include improving waste management and processes, as
well as the progressive replacement of the organisation’s vehicles for a more sustainable fleet.

In this sense, focusing on generating renewable energy and contributing to the achievement of SDG 7
‘Affordable and clean energy’, FCC Medio Ambiente obtained the ‘Calculate-Reduce-Offset’ seal for the third
year running, making its commitment to the reduction of greenhouse gas emissions effective. At the same
time, it collaborates in reforestation projects that act as CO2 sinks to offset emissions.

Integrating state-of-the-art technology developments along with knowledge, initiatives and best practices,
FCC Medio Ambiente offers more efficient solutions, such as the development of vehicles using clean
energies, generation of renewable energy, and the use of efficient equipment and machinery at its facilities,
promoting self-consumption of energy with minimum impact to improve quality of life and make the cities
where it offers services ever more sustainable.

Increase investment in sustainable projects.

FCC Medio Ambiente demonstrates its commitment to sustainability issuing green bonds. These funds
are used in projects that generate major environmental benefits, specifically related with mitigation and
adaptation to climate change, in the communities where it operates.

Promote the use, consumption and
responsible management of water resources
and address water stress.

The Area has implemented various initiatives and best practices designed to improve efficiency in water use.
These measures are reflected both in the facilities and in the execution of cleaning and watering services for
parks and green areas.

Response to future challenges | Page 10 of 36

Environmental Services

Challenges

Actions

Lead sustainable mobility in urban services.

FCC Medio Ambiente continues to innovate and has developed the first industrial e-mobility chassis-platform
for urban services, known as ie-Urban Truck. Already operational in Spanish cities like Madrid, Barcelona
and Zaragoza, this initiative aims to facilitate progress in electrical mobility in urban settings, promoting a
transition towards smarter and more sustainable cities. It is also developing the H2TRUCK project to make
the hydrogen cell-powered electric industrial chassis-platform a reality.

Adopt sustainable urban development goals. The Environmental Services Area is committed to contributing to the creation of sustainable and self-

sufficient cities, transforming them into more welcoming urban environments for their inhabitants by applying
innovative technologies. This entails the development of new service models adapted to the needs of smart
cities. A system of indicators to measure sustainability-related impacts in cities has also been proposed,
which will allow for continuous assessment of the situation and improvement measures.

Innovation in the search for new services, machinery and work methods will also be fostered to improve the
quality of life of citizens and reduce environmental impact.

Response to future challenges | Page 11 of 36

Environmental Services

Challenges

Actions

Implement improvements in waste
management and recovery processes.

Optimisation and extension of waste
management services.

For the purpose of improving waste management, reducing emissions and improving the percentage
of waste recovery, FCC Medio Ambiente participates in R&D&i projects related to the circular economy.
Projects such as BIOPROLIGNO, RSU4HOM, ECO2D4.0 or B-FERST aim to recover different types of waste
to contribute to the maintenance of infrastructure and green areas, as well as the development of new
construction materials.

FCC Medio Ambiente has strengthened its waste management position in the UK, Spain and the USA. In the
UK, FCC Servicios Medio Ambiente has extended its business in waste recycling and treatment activities
with the partial purchase of the Urbaser group providing these services. It is expanding in Spain with new
contracts for various facilities that will increase waste recovery activity. FCC Environmental Services
increases its presence in the USA in waste collection and treatment with various initiatives that reflect a
strategy of geographic expansion, service diversification and strategic acquisitions.

Reduce the quantity of waste sent to landfill
for more recycling and reuse.

The Environmental Services Area is committed to process optimisation and circularity. By taking part in a
variety of projects such as LIFEPLASMIX, LIFE4FILM and LIFE ZEROLANDFILLING, it encourages avoiding
urban waste being deposited in landfills to achieve recovery and effective recycling.

Transform traditional waste treatment
processes.

With the aim of transforming traditional biological treatment processes in biorefinery, FCC Medio Ambiente
takes part in projects like INSECTUM and DEEP PURPLE, which use insects to promote the bioconversion of
urban by-products and biowaste to recover resources.

Promote the use of new clean energy
sources.

FCC Medio Ambiente is conducting various production projects for clean energies like biogas, biomethane
and biohydrogen from biowaste. The LIFE LANDFILL BIOFUEL, LIFE INFUSION and ECLOSION initiatives seek
to transform waste management centres into biomethane and green hydrogen production facilities.

Response to future challenges | Page 12 of 36

Environmental Services

Challenges

Actions

Optimise service quality and guarantee data
protection.

FCC Medio Ambiente continues to promote digitalisation and data protection through the VISION platform.
This vertical app, incorporated into the National Security Scheme in 2022 and certified according to the ISO
27001 standard, is key in improving relations with clients and service provision efficiency.

Design tools to improve productivity.

Management system digitalisation.

In collaboration with the SCALIBUR project, FCC Medio Ambiente has participated in implementing
a continuous monitoring system to provide an accurate and real-time assessment of the quality of
biowaste input into the Las Dehesas biomethanisation plant in Madrid (Spain). This tool will facilitate the
implementation of corrective measures and contribute to improving operational efficiency in recycling
processes.

FCC Medio Ambiente’s 2050 Sustainability Strategy includes as an integral part of its lines of action the
acceleration of management system digitalisation processes to promote knowledge synergies. The VISION
platform is in constant development and serves as a basis for extending process digitalisation in the
organisation by rolling out new modules, connecting with other platforms, both internal and external, or
providing mobility applications.

Response to future challenges | Page 13 of 36

Environmental Services

Challenges

Actions

Forest management and restoration.

Protect biodiversity in the urban
environment and ecosystems.

Raise staff awareness on protecting
biodiversity.

FCC Medio Ambiente collaborates with the Galician Forestry Association to restore areas affected by
wildfires in Ponteareas and Vigo, in Pontevedra (Spain), applying natural regeneration and selective planting
techniques.

In collaboration with the Hellín City Council in Albacete (Spain), FCC Medio Ambiente has also restored an
inert construction and demolition waste landfill in town. This ecological restoration initiative focused on
replanting the area with native tree species. With these projects it also offsets part of the carbon footprint
generated by its activity.

The Area is involved in various activities related to the maintenance and preservation of parks and green
areas as well as others specific to its industrial treatment and urban solid waste elimination facilities, such
as collaboration in the bird tracking process. In line with this commitment, in 2023 FCC Medio Ambiente
renewed its adhesion to the Pact for Biodiversity of the Spanish Business and Biodiversity Initiative (IEEB).

As part of the Environmental Services Area’s commitment, a Training Plan focused on responsible
management has been developed, which includes a module dedicated to biodiversity. The aim of the plan
is to inform and raise awareness among partners on activities that improve and consolidate sustainable
environmental management in the services provided.

Eradicate the proliferation of invasive
species.

FCC Medio Ambiente has undertaken various actions in the fight against pests, collaborating closely with
institutions such as the Polytechnic University of Valencia and the Canary Islands Agrarian Research Institute.
These partnerships have led to consultancy and studies aimed at combatting various invasive species.

Response to future challenges | Page 14 of 36

Water

Challenges

Actions

Mitigate climate change.

Reduce and prevent the possible
contribution to environmental impacts
caused by pollution.

In line with its vision of preserving the environment, Aqualia activates projects to achieve CO2 emission
neutrality, increase the use of renewable energies, improve energy efficiency at facilities and transform the
vehicle fleet.

To limit its contribution to the carbon footprint, implementing the energy optimisation system reduces the use
of energy for lighting and climate control at Group offices and warehouses. Improvements to monitoring and
control platforms also help reduce consumption and contribute to energy efficiency.

The Water Area ensures correct compliance with legal requirements on atmospheric emissions and designs
preventive measures to be taken in case of environmental risk with all its partners.

Alleviate water stress with better water
management.

To address the water shortage and reduce water stress, Aqualia assesses how its activities impact water
resources, implementing processes such as water desalination.

Response to future challenges | Page 15 of 36

Water

Challenges

Actions

Build infrastructure to supply water to the
population.

Aqualia distributes drinking water through a network from header deposits to towns and homes, ensuring
efficient access for the population.

Ensure urban development that is resilient to
extreme climate conditions.

The Water Area works on solutions such as the LIFE Reseau project, which supports the reconditioning of
sanitation infrastructures to increase their resilience in areas of intense rainfall.

Manage infrastructure to contribute to
sustainability in food production and
efficient handling of water resources.

Aqualia manages and maintains irrigation infrastructures, collaborating with communities and entities to
ensure optimum water availability for the agricultural sector.

Response to future challenges | Page 16 of 36

Water

Challenges

Actions

Minimise waste generated by maximising
product value throughout their life cycle.

Aqualia works to develop solutions to treat wastewater by converting into value-added products, thus
significantly reducing energy consumption. The LIFE Ulises project, ran in conjunction with the El Bobar
Plant in Almería (Spain), stands out for studying how to transform wastewater treatment plants into neutral-
discharge biofactories.

Promote the circular economy through
cutting-edge technology development.

The Water Area is developing various advanced technologies to improve water quality, seeking efficiency and
optimisation of municipal and industrial installation operation related with the end-to-end life cycle of this
resource. One example is recovering phosphorous through struvite precipitation.

Facilitate the transition towards a circular
model by means of collaboration.

Agreements with the supply chain to reuse resources and promote responsible water consumption among
citizens are just some of the specific measures adopted by Aqualia to guarantee the transition to a circular
model.

Response to future challenges | Page 17 of 36

Water

Challenges

Actions

Digitalise water management to ensure an
efficient end-to-end cycle.

Use artificial intelligence to improve the
quality of life of citizens.

Investment in technology innovation means Aqualia continues to progress in the efficient digital
transformation to achieve smart management and an optimised end-to-end water cycle. This roadmap
includes energy efficient processes, continuous monitoring and the detection and prediction of events prior to
decision making. All to continue optimising sustainable management and water quality.

Digital innovation projects include those aimed at developing Aqualia Water Analytics (AWA) for smart water
management in cities; projects to improve mobility in management processes to gain efficiency; and others
geared to the integration of different platforms.

The development of artificial intelligence has contributed to launching projects to offer users greater
transparency in the water service, increasing their knowledge of processes and awareness of water use. New
technologies are incorporated that contribute to the modernisation of the service provided (Smart Santander)
and customer management and communication systems are developed to make them an active part in the
process (Smart App).

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportAcceleration of digital transformation, cybersecurity and artificial intelligenceResponse to future challenges | Page 18 of 36

Water

Challenges

Actions

Protect and seek the recovery of aquatic and
land ecosystems.

Aqualia is developing a project so it can identify possible impacts on biodiversity and establish controls to
protect and prevent the degradation of ecosystems, promoting efficient and equitable practices in water use.

FCC. Annual Report 2023

Response to future challenges | Page 19 of 36

Infrastructure

Challenges

Actions

Promote adaptation and identify solutions
for climate resilience.

Making the most of new emerging technologies, FCC Construcción set objectives in the Climate Change
Strategy to improve its response to imminent meteorological changes. FCC Construcción seeks to strengthen
infrastructures, residential and non-residential buildings (museums, sports facilities, healthcare facilities, etc.)
by adapting processes and resilient materials in the design and construction phases.

Reduce dependence on fossil fuels.

As part of the sustainable R&D&i solutions, the Infrastructure Area is committed to replacing its vehicle fleet,
reducing the consumption of fossil fuels and fostering the use of electricity with renewable energy sources.

Contribute to the reduction of greenhouse
gas emissions.

FCC Construcción has developed a series of measures that promote energy efficiency in its site and centre
processes using new technologies and by optimising energy consumption. The measures include the
installation of LED lights and adaptation of modern and efficient machinery.

It also includes the concept of climate change in its organisation, obtaining the “Calculate and Reduce”
seal from the Ministry for Ecological Transition and the Demographic Challenge in consecutive years for its
Emissions Reduction Plan 2021-2025.

Identify solutions to problems caused by
water stress.

The company continuously reduces its water consumption by means of efficient use of water, such as water
collection, treatment and reuse measures. A methodology is under development to calculate its hydrological
footprint with an audit and certification planned for 2024.

Formalise a roadmap to mitigate the impact
of its business model in aspects of climate
action.

The 2023-2026 Climate Change Strategy contains the organisational response to the climate challenge at
FCC Construcción. The strategy is a fundamental basis for achieving objectives, detailing certain processes
for compliance.

Response to future challenges | Page 20 of 36

Infrastructure

Challenges

Actions

Integrate sustainable construction in site
development.

Participate in projects that promote urban
transformation in cities where it operates.

FCC Construcción develops projects that stand out for their commitment to sustainable development
(economic, social, environmental and governance) at global level. Sustainable practices are included in
projects, such as the design, construction, operation and maintenance of a commuter train network in
Toronto (Canada), as well as various infrastructures developed in over 21 countries around the world.

FCC Construcción’s commitment to sustainability is embodied in its Sustainability Strategy, approved and
published in 2023.

In 2023, FCC Construcción won the project to bury the train track in Moncada i Reixac, Barcelona (Spain).
The contract entails building a new station, which will represent an urban and railway transformation. This
project will improve the quality of life of people, creating new living spaces and promoting the town’s urban
transformation. The design will follow sustainability and accessibility criteria, contributing to the reducing the
carbon footprint and making the city more dynamic at socioeconomic level.

Response to future challenges | Page 21 of 36

Infrastructure

Challenges

Actions

Integrate circularity throughout the value
chain.

Starting with a collaborative effort with its suppliers, FCC Construcción ensures that the materials and
equipment used in its projects contribute to efficiency, extending their use and reincorporating them into
the product-waste-product cycle at the end of their useful life. Close collaboration with the supply chain is
essential to foster responsible practices and increase the positive environmental impact.

Incorporate responsible use of materials and
waste recovery.

The Infrastructure area’s Sustainability Plan covers methods for the transition to a circular model, prioritising
waste recovery and responsible use of materials. To this end, it manages waste by including best practices,
promoting the reuse of waste and use of recycled and renewable materials.

Response to future challenges | Page 22 of 36

Infrastructure

Challenges

Actions

Implement solutions for operational
efficiency.

Develop technologies to improve process
techniques.

Optimise site monitoring.

The ISO 27001-certified Alejandría Project is an innovative platform for information centralisation and data
integrity. Alejandría is the basis for management at the organisation, providing a comprehensive vision of the
evolution of information at FCC Construcción. It integrates quick and precise search capacity and implements
a common structure that guarantees file security.

Prefabricados Delta, a subsidiary of the Infrastructure Area, has developed a technology based on the
Industry 4.0 framework. Initially installed at the Puente Genil factory in Córdoba (Spain), this solution as
successfully completed the pilot phase. The next step is to extend it to all elements of the two manufacturing
plants, setting a significant milestone in the organisation.

The launch of the Cupix mobile platform aims to make it easier to view site life cycles and promote client
collaboration in design by capturing 3D images of work settings. It also allows for proactive risk identification,
cost optimisation and improved time used in project management.

Response to future challenges | Page 23 of 36

Infrastructure

Challenges

Actions

Contribute to ecological integrity.

FCC Construcción collaborations contribute to ecological continuity is urban areas. For example, it will work
with Madrid City Council in building a forest ring around the city, using native species and restoring degraded
areas.

Integrate biodiversity protection measures.

Biodiversity is protected by preparing specific biodiversity plans and establishing a methodology for the
prevention and assessment of impacts in vulnerable habitats.

Raise awareness on the importance of
biodiversity.

FCC Construcción recognises the importance of participating in environmental awareness. In collaboration
with Madrid City Council and the Spanish Association for the Protection of Butterflies and their Environment
(ZERYNTHIA), the company has developed the Butterfly Oasis as part of the Metropolitan Forest project.
The aim is to create spaces to protect pollinators so as to increase awareness and promote permeability for
biodiversity in urban settings.

Prioritise the renaturalisation of spaces.

The Infrastructure Area implements local renaturalisation actions. It has taken part in the development of
accessible trails among native vegetation and commercial areas, improving access and maintaining trail
continuity.

Response to future challenges | Page 24 of 36

Cement

Challenges

Actions

Changes in carbon price mechanisms
and emission rights trading.

Each year, Cementos Portland Valderrivas Group sets targets for reducing emissions in its activity. To achieve this, it
develops improvement plans to move towards the energy transition. Some measures include improving dosing and
alternative fuel systems, the use of materials with a higher percentage of biomass and changing furnace burners.

Improve energy efficiency.

Optimise the use of water resources.

The Cement Area has assigned resources to launch energy efficiency strategies as well as conducting audits
according to the ISO 50001 standard. The strategies include solar panels projects, continuous improvement of
productive processes, installation of expert systems in driving the furnace in coal and cement mills, as well as
updating equipment. Critical production processes have also been reviewed with specialised engineering in search
of energy improvements.

The company manages water consumption at its facilities responsibly. This entails automation and leak control in
water networks to prevent losses. A system has also been put in place to reuse wastewater from other companies
so that water can be used to cool gas conditioning equipment before filtering. Rainwater collection and reuse
measures have also been implemented for processes, as well as improvements to water infrastructure.

Commitment to alternative fuels for
thermal energy generation.

GCPV has a strong commitment to reducing tonnes of CO2 emissions to the atmosphere and continuously opts for
the use of alternative fuels with biomass as an alternative source of thermal energy to fossil fuels. This measure has
avoided to emission of 2,327,768 tonnes of CO2 in the last 13 years.

Increase the use of renewable energy
sources.

The Area is involved in a variety of cross-sector collaborative projects to extend the use of renewable energies at its
facilities.

As a result of these initiatives, GCPV closed a long-term power purchase agreement (PPA) with Capital Energy. With
this agreement, the power company undertakes to supply approximately 80,000 MWh of energy generated by wind
farms to the factory in Cantabria (Spain).

In 2023, around 63% of electricity consumed at cement factories in Spain came from PPAs from renewable sources
and the renewable energy mix supplied by independent marketing company Fortia.

Response to future challenges | Page 25 of 36

Cement

Challenges

Actions

Apply circular economy processes such
as replacing fossil fuels with alternative
sources.

Increase material and energy recovery.

Optimise waste management.

The company is immersed in a sustainable production projects for its plant in Alcalá de Guadaíra, Seville
(Spain). The project is based on a circular economy model widely adopted in Spain that promotes industrial
symbiosis by using different types of non-hazardous waste as a source of energy. Thanks to its high heat
power, composition and granulometry, this fuel will allow for the partial replacement of conventional fuel
currently used.

GCPV is an important recycler of a wide range of industrial waste, such as ash, slags, construction and
demolition waste and paper manufacturing process sludges. This fosters the responsible consumption of
natural resources by reusing materials obtained from waste and by-products, reducing the need for natural
raw materials and minimising the environmental impact associated with their extraction.

It also promotes the use of fuels with a high biomass content and uses other materials that would end up in
landfill were they not reused in an industrial setting.

To ensure the proper management of waste produced at our factories, selective collection measures are
implemented in accordance with current legislation. Emphasis is placed on waste prevention and separation
for temporary storage until they are finally managed by an authorised manager, prioritising options such as
recycling, reuse and recovery over elimination in landfill whenever possible.

Response to future challenges | Page 26 of 36

Cement

Challenges

Actions

Administrative modernisation and
strengthening collaboration with our
suppliers.

The Supplier Channel launched by Cementos Portland Valderrivas Group opens up new opportunities by
streamlining administrative tasks and improving the supplier experience. This initiative offers the change to
automate processes, freeing up human resources for more strategic tasks. The structured communication
channel also operates 24 hours a day to encourage greater collaboration and efficiency in supplier relations.

Modernisation and technology innovation in
the construction industry.

CPV Group is committed to collaborating and developing R&D&i projects for the manufacture of reliable,
sustainable, resilient and high-quality construction products, with the aim of promoting economic and social
development. This commitment translates into a more efficient use of resources and actively promoting the
adoption of advanced technologies, research and innovation.

Implement the digital signature on delivery
notes, an essential tool for streamlining
management.

The digital signature has been implemented on delivery notes at all Cement factories in Spain.

The digital signature is a confirmation system that can record cement and mortar product delivery to
factories and at destination online by using electronic devices.

This digital signature replaces signing paper delivery notes used after delivering goods, thus saving time,
improving certainty in material delivery and helping reduce the carbon footprint.

Response to future challenges | Page 27 of 36

Cement

Challenges

Actions

Implement sustainable practices to mitigate
the alteration of natural habitats.

Obtaining raw materials and particle emissions cause alterations in natural habitats. In response to this,
Cementos Portland Valderrivas has implemented various measures to mitigate its impact on these habitats.
These measures that include repairing soil morphology, replanting used surfaces with suitable sowing and
planting techniques and the use of native species. Agreements are also in place with nature protection
associations.

Develop integrated management criteria to
promote biodiversity.

In order to guarantee balanced biodiversity, different criteria that impact decisions on the type of resources
to use, location, waste management and economic viability are established in both operating processes and
project design.

Generate positive impact on biodiversity.

In 2023, El Porcal was included in the wetland catalogue of the Region of Madrid thanks to close collaboration
between Cementos Portland Valderrivas Group and a nature association. El Porcal has now become an
idyllic space, home to many native and migratory species. It has thus been selected to form part of a national
project with EU funding focusing on resolving the threat to the marbled duck population, one of seven bird
species in a critical situation in Spain.

Another GCPV action to promote biodiversity is by planting cereals and legumes at the Monjos factory quarry
to favour the proliferation of wildlife in the hunting territory of a pair of Bonelli’s eagles that inhabit the area.

Response to future challenges | Page 28 of 36

Real Estate

Challenges

Actions

Mitigation and adaptation to climate change.

Human and environmental health protection.

Ensure responsible use of water and use
alternative sources to the network to reduce
water stress.

In order to reinforce its environmental commitment, FCC Real Estate uses sustainable architecture
principles in its developments. In the case of buildings that have already been erected, by replacing
climate control units for other using lower-impact refrigerant gases to reduce greenhouse gas (GHG)
emissions.

On the other hand, Real Estate’s will to reduce energy consumption and achieve energy efficiency has
led to it to design buildings with energy efficiency rating A or B, responsible material procurement, adjust
temperatures and instal LED lights in buildings.

In order to respect public health and care for the environment, the Real Estate Area has incorporated
ECO LABEL-certified cleaning products at all buildings with BREEAM certification. This measure is part of
its commitment to minimising the negative impact on the environment and human health.

The company implements measures to efficiently monitor, reduce and manage water consumption, make
use of rainwater and improve treatment systems.

Real Estate

Challenges

Actions

Promote sustainable urban development to
improve the quality of life of people.

FCC Real Estate promotes spaces created for public well-being and contributes to the creation of more
inclusive, safe, resilient and sustainable cities.

Raise public awareness based on
sustainable construction.

The Real Estate Area promotes more sustainable habits and greater awareness among building users,
supporting them in proper management of waste generated and by the use of systems, in design and
construction, which provide environmental, social and economic benefits.

FCC. Annual Report 2023

Response to future challenges | Page 30 of 36

Real Estate

Challenges

Actions

Reduce global waste generated and ensure
proper management.

Aware that the main types of waste generated in the Real Estate Area are produced by the activities of
property tenants, the company works with authorised managers to ensure property management and
removal of waste depending on its nature.

Increase the useful life of existing
resources.

Advance towards a more circular
construction model.

To better use existing resources, the Real Estate Area implements waste tracking and recovery measures.
Reusing furniture and other elements in leased offices and premises is one example of these measures.

A Waste Management Plan has been implemented on order to ensure more efficient waste management and
reduce the quantity of waste generated on new sites. This is a waste tracking and recovery tool for monitoring
and identification to adopt measures that help minimise waste and thus contribute to the circular economy, in
collaboration with different construction companies.

Real Estate

Challenges

Actions

Improve customer experience through home
digitalisation.

The progressive implementation of home automation is a key aspect in increasing the well-being of users
by integrating the comfort of remote use of smartphones with the optimisation of resources used by the
Real Estate Area in its activities.

Develop new technologies for efficient
resource use.

To improve efficiency in building resource use, FCC Real Estate take part in R&D&i projects to develop
technology systems.

FCC. Annual Report 2023

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Real Estate

Challenges

Actions

Minimise the deterioration of natural
habitats and soil degradation.

An Environmental and Biodiversity Management Plan is developed for each BREEAM-certified property so as
to protect and improve elements of ecological value at the sites.

Protect local biodiversity through
collaboration.

The Real Estate Area applies measures and participates in projects for the conservation, protection and
increase of populations of species such as the peregrine falcon.

FCC. Annual Report 2023

4.3.
FCC Strategy:
focus on growth with
profitability

The FCC Group’s model of value creation aims
to foster the sustainable evolution of cities,
positioning FCC at the forefront of its competitive
environment, taking into account quality and
innovation, integrity in its actions, efficiency in
management, proximity and commitment in
the way it acts. The FCC Group and each of its
businesses focus their strategy primarily on:

FCC has proven its resilience and adaptation
throughout its history based on three main
components: a leadership position in the different
businesses; sustainability as a source of income;
and the strength of its balance sheet and
shareholder structure.

Strengthen their competitive position in

key markets in which it is currently present.

Selective growth in new markets that are
attractive and aligned with the corporate
culture and risks of the company.

Maintain leadership in key
markets and selective growth
in new markets

providing guarantees and the reliability of a big
leading company, while also remaining local and
focused in the long-term on each of the regions
where it operates.

In the countries where it operates, FCC focuses its
efforts on guaranteeing the quality and continuity
of its services and products with the aim of
retaining a competitive position in each market.
Given the diversity and how they complement
each of the businesses, the synergies between
them help to correctly assess the risks and
potential of each of project, which translates into
a sustained increase in the Group’s different key
geographical areas. FCC intends to be a partner to
its customers, establishing long-term relationships,

Meanwhile, each of the FCC Group business areas
detects opportunities of interest in the markets in
which it operates, as well as in new markets. The
Group’s strategic planning means it can establish
objectives to be achieved by each area of activity.
These objectives consider market opportunities
and the risk appetite deemed acceptable in each
country where these opportunities arise.

2_
Ethical governance
at the highest level

Response to future challenges | Page 34 of 36

Environmental Services

The Environmental Services Area is in a process
of transformation caused by the different
environmental demands from regulations mainly
related with the circular economy and climate
change. New opportunities therefore focus
primarily on improving energy efficiency, in smart
cities and urban mobility. The area’s strategic
objective is to increase the quality and quantity of
reusable raw materials by investing in selective
collection and automatic sorting facilities to
comply with regulatory objectives.

Moderate growth is expected in Spain, competing
in tenders that are attractive as they are strategic
or profitable. Waste collection and street cleansing
activities are expected to maintain a contract
renewal rate of over 90% and also to obtain new
contracts, mainly related with applying municipal
waste regulations and as part of regional Waste
Master Plans. In the industrial waste activity, the
goal is to diversify the business with types of
treatment other than those currently applied and to
increase the portfolio of major clients.

Strategic actions in Spain will focus on
maintaining competitiveness and a leadership
position, combining technical knowledge and
the development of innovative technologies,
offering respectful and sustainable services
related to climate change and the reduction
of the carbon footprint. On the other hand, as
previously indicated, the Area will try to leverage
potential opportunities arising from more stringent
regulations and new services, such as smart
city development, which aims to apply a circular
model that reintroduces waste materials into the
production processes based on R&D&i projects.

In Portugal, business opportunities are also
expected in urban waste disposal and industrial
waste treatment.

A slowdown is expected in the United Kingdom
despite governmental objectives setting a recycling
expectation of 65% in 2024 and a maximum of
10% of waste ending up in landfill. However, delays
in different environmental regulations linked to the
extended producer responsibility, the container
return system or implementation of a tax in
2028 on sector emissions are generating certain
short-term uncertainty.

In Central Europe, the medium-term strategy
may lead to a change in the business model in
the Czech Republic, Poland and Slovakia towards
greater treatment and the development of energy
recovery from waste motivated by the legal
situation that will tax and ban landfilling.

As for the USA, various contracts initiated in 2022
have been consolidated in 2023, including other
major ones in California, Florida and Texas. Work
also continues to extend and modernise the first
recycling centre in Placer County in California,
with the final handover expected in December
2024. It will be one of the biggest environmental
compounds of its kind with capacity to treat
650,000 tonnes per year. In total, US sales have
grown by 46% in 2023 and FCC is among the top
15 sector companies in the country; it is the largest
recycling processor in Texas with a major presence
in Florida and significant operations in the west.

In the coming years, the company will continue to
consolidate its presence by the growth of more
residential contracts and boosting the commercial
collection activity.

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Water

In the Water Area, the aim is to maintain a
competitive position in the markets where it
operates and make the most of opportunities
arising in consolidated markets for end-to-end
water cycle management, mainly in Europe.
In other expanding markets, the plans are to
promote end-to-end cycle management as well as
growth via BOT (Build-Operate-Transfer) and O&M
(Operation & Maintenance) in North Africa, Latin
America and the Middle East. New opportunities
will also be studied in markets like the USA and
other countries provided they have a stable
political-social context that allows for long-term
project development.

Full recovery of pre-pandemic levels in non-
residential consumption is expected in
consolidated markets. This situation will be
reinforced by new contracts added in 2023 in
Colombia, France and the US A.

By geographic area, in Spain normalisation
of electricity rates is expected, an increase in
contracts that mitigate price volatility that set a
larger volume of consumption at a fixed price, as
well as the municipalities managed by Aqualia
considering applying the Consumer Price Index
(CPI) accumulated over the last two years.
The PERTE programme (Strategic Projects for
Economic Recovery and Transformation) project
award process is expected to be streamlined to
promote the digitalisation of the end-to-end water
cycle management. Note that, at national level
and some autonomous regions have approved
emergency plans for the construction of new
infrastructure, new deep catchments, extending
desalination plants and improving the use of
surface water. New actions in Barcelona, Almería
and Málaga in desalination stand out, as well as
reuse in Andalusia and Alicante, valued overall at
1.4 billion euros and set to increase in 2024 and
beyond. The Government of Spain also approved
the third cycle of hydrological planning for all

national basins, with a joint budget for necessary
actions of 22.8 billion euros, so opportunities
are expected from the proposals that may be
submitted.

In the rest of Europe concessions are expected
to continue, such as Caltanisseta in Sicily (Italy),
for which 14 million euros were obtained from the
REACT-EU programme to improve remote control
and reading services Also in France, with contracts
in Pays de Dreux and the renewal of Andres.
Numerous proposals has been submitted to water
tenders in the Czech Republic with various awards
achieved.

In Saudi Arabia there is an ambitious programme
for the modernisation and optimisation of
end-to-end water cycle services; and in Egypt
an ambitious Desalination Plan associated with
the generation of photovoltaic energy will begin
with Aqualia leading a multidisciplinary and
multinational consortium.

Meanwhile in LATAM, in addition to contracts in
Mexico and Colombia, Peru is in the process of
assessing the efficiency of public supply services
to allow the incorporation of private initiative.
Aqualia has participated in various initiatives for
wastewater treatment and desalination plants
currently at an advanced stage.

Finally, in the USA, we have acquired a majority
stake in the company Municipal District Service,
LLC (MDS), whose main goal is comprehensive
water and sanitation infrastructure services in
Municipal Utility Districts (MUD) to develop the
US market. Water scarcity, the obsolescence of
hydraulic infrastructure, low penetration by private
operators and the demand for regulating pollution
are the main opportunities for growth in the
different states.

Response to future challenges | Page 36 of 36

Construction

In the Construction Area, the international market
focuses on countries and markets with a stable
presence and secured project financing. The
Area currently has a selective presence in more
than 16 countries in Europe, MENA and America.
The search for new contracts always follows a
stringent risk management procedure that ensures
profitability and cash flow generation of a selective
portfolio of projects.

Turnover is expected to be similar in 2024 to 2023
thanks to the development of infrastructure work
from previous years in various markets (America,
Middle East and Europe). In 2024, new project
contracts have been formalised, such as the EPC
(Engineering, Procurement and Construction)
for the liquefied natural gas (LNG) storage and
regasification terminal in Stade (Hamburg),
construction of the Rubí Metro line in Porto
(Portugal), “Pape Tunnel and the Underground
Station” for the Toronto Underground (Canada)
and the construction of a nuclear reactor in Petten
(Netherlands), to name just a few.

Highlights at national level include awards for the
construction project to bury the R-2 train line as
it passes through Montcada i Reixac (Barcelona);
the demolition of buildings, refurbishment of the
Auditorium and completion of the new ONCE
headquarters (Madrid); the new hospital in Aranda
de Duero (Burgos); A-73 motorway construction
project (Burgos); phase 3 development in Los
Berrocales (Madrid) or the new engineering and
construction projects for photovoltaic plants in
Seville and Cáceres by Industrial.

Internal consumption in 2024 is expected to fall
4% in Tunisia, mainly due to the economic, social
and political crisis experienced by the country in
recent years.

In this context, the Area will continue to pursue
its policies of optimisation of expenditure and
investments and adaptation of all its organisational
structures to the reality of the various markets in
which it operates in order to improve cash flow
generation and support sustainable development.

Cement

Real Estate

The Cement Area’s main objective is to remain
competitive in terms of both costs and market
share in the markets in which it operates,
attempting to retain its status as an industry
benchmark in all the countries in which it has a
presence. The Area enjoys a position of leadership
in its main market, Spain, and a relevant position in
Tunisia.

However, the cement sector in Spain has seen
a slowdown in consumption in recent months, a
slight drop in exports, which we are trying to boost,
and a sharper fall in imports.

In 2023, the Real Estate Area has continued its
consolidation in the Group by increasing the
stake of FCC Real Estate, a company in which
FCC has an 80% stake in listed companies Realia
Business, S.A. and Metrovacesa, S.A. These
operations, together with those carried out in
the previous two years have made it possible to
take advantage of opportunities for growth in the
sector, diversify risk and the presence of FCC Real
Estate in Spain by expanding its activity to new
areas of operations where it was not present; and
finally, a notable increase in recurring rental asset
activity as a whole. Equity assets were measured in

December 2023 and account for over 73% of total
group assets.

Furthermore, gaining representation on the
Metrovacesa governance bodies in December
2023 reinforces the real estate group’s solidity,
benefiting from its ability to generate cash flow.

In terms of future forecasts, the equity Area will
continue to work on increasing its portfolio of
BREEAM sustainability certified buildings managed
and improving performance in offices, business
premises and shopping centres regarding energy
and water consumption and waste management
with continuous, automated and digital monitoring.

The Real Estate Area will maintain its development
activity by completing ongoing projects and
starting new ones, seeking profitability and viability.

Finally, a new investment in Build to Rent (BtR)
projects in Tres Cantos (Madrid) with a total of 59%
of the homes completed. The Area will continue
its operations and analyse opportunities provided
there is a guaranteed return on investment.

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at the highest level

3_
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Highlights of the year 2023 _ 85

Key figures _ 88

FCC. Annual Report 20234FCC in 20231_
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Highlights of the year 2023 | Page 1 of 3

FCC Construcción is certified by the National Security System (ENS) for its cybersecurity.FCC Construcción wins the project to construct the new Son Dureta hospital complex in Mallorca (Islas Baleares, Spain).The Cementos Portland Valderrivas Group launches its campaign under the name “Safety is not negotiable” aimed at raising the awareness of all personnel of all kinds of work involving high risk and the attitude to adopt towards them.Construction begins at Residencial Arabona. 64 detached 4-bedroom homes of FCC Inmobiliaria in the municipality of Tres Cantos (Madrid, Spain).Aqualia wins a 10-year contract to manage drinking water in the area of Foret du Theil, in the Ille and Vilaine department of Brittany (France).Aqualia takes part in the StepbyWater alliance conference ‘Drought in Europe’ supported by the Government of Spain and the Spanish Federation of Municipalities and Provinces (FEMP).Aqualia participates in ‘Carrefour des gestions locales de l’eau’, the main water management event in northwest France.FCC Construcción achieves a key milestone in the Major Bridge P·project in Pennsylvania (USA).FCC Group Corporate Services signs its 1st Group Equality Plan.FCC Environment starts up the Integrated Waste Management System in Brăila County, (Romania).Platja d’Aro Council in Girona (Spain) awards Aqualia management of the water supply for the next 25 years.Twenty-year extension to the Aqualia contract, via its subsidiary Linaqua, for service in Linares, Jaén, thus consolidating the first contract in Spain obtained in 1972.FCC Medio Ambiente continues to provide municipal services for the city of Manresa (Barcelona, Spain).FCC Equal Comunidad Valenciana Special Employment Centre starts up new street cleansing service in the town of Massamagrell (Valencia, Spain).EnergyLOOP, company promoted by FCC Ámbito and Iberdrola, will build its innovative wind turbine blade recycling plant in the municipality of Cortes (Navarre, Spain).FCC Environment opens a new recycling centre for sorting plastic and paper waste in Ostrava (Czech Republic).1. Highlights of the year 2023JanuaryMarchFebruaryGroupEnd-to-end WaterManagement CycleInfraestructuresReal EstateCementEnvironmentFCC Medio Ambiente sends a shipment of basic necessities to Ukraine with the collaboration of 'És Per Tu'.FCC Ámbito launches the PV4INK project for the recycling of photovoltaic panels (Spain).The consortium, led by Aqualia, that manages water services for the North Cluster in Saudi Arabia formally begins its operation.Aqualia presents a seminar in Oviedo (Spain) on regeneration and reuse of water as part of the H2020 ULTIMATE project.The treatment plant in Jerez de la Frontera (Cádiz, Spain), opts for energy sustainability by installing over 1,500 solar panels.FCC Construcción continues to grow in Romania with two new railway contracts.FCC Construcción accedes to REDI, the Business Network for Diversity and LGBTI Inclusion.The Cementos Portland Valderrivas Group presents to the Municipality of Santa Margarida i els Monjos, Barcelona, Spain,the historic documentary archive of the old Freixa Cement and Lime factory, consisting of 62 documents of great heritage value,which were incorporated into the Municipal Archive.Application for Building Permit for the “Natura” residential building, 64 apartments in Massarrojos (Valencia, Spain) and the “Sedalis” residential building, 39 apartments in Finca El Pato (Málaga, Spain).Inauguration of the AITASA treatment plant at the largest petrochemical industrial estate in Southern Europe, built by Aqualia, and that will operate for 5 years.Aqualia and Los Alcázares Council in Murcia (Spain) present the NINFA project, which will monitor and prevent contamination in the waters of the Mar Menor.FCC Construcción and Samsung C&T Corporation sign a partnership agreement to work together on international infrastructure projects.FCC Industrial wins the contract to develop a large regasification plant in Germany.The CPV Group celebrates International Women’s Day in all its centres under themotto “Todos Sumamos” (All Together).The Group collaborates to reverse the critical situation of the marbled duck in Europe, with the release of 20 specimens in the lakes of its property at El Porcal, Madrid Province, Spain.Public authorities of Cantabria visitthe Cementos Portland Valderrivas Group’s facilities at the Port of Santander, Spain.Handover of keys for 71 apartments of FCC Inmobiliaria’s “Bôrea Portablanca Phase II” development: 1, 2, 3 and 4-bedroom homes in Arroyo del Fresno (Madrid, Spain).FCC celebrates the V Edition of the Vive Saludable Awards.FCC Environmental Services breaks ground at the Placer County Environmental Compound in California (USA).Dual nomination at the Global Water Awards for ‘Water Company of the Year’ and ‘Wastewater Project of the Year’ for the Abu Rawash plant (Egypt).AqualiaMACE rewarded by public corporation Al Ain Distribution Company, Abu Dabi (United Arab Emirates) for its commitment to the health and safety of is more than 500 employees.AprilThe ‘Hub Reusa’ project is presents at the El Toyo WWTP in Almería (Spain) as a reference for the agricultural use of regenerated water.Present at the Quality Water Summit and the 5th Ibero-American Congress of Engineering and Technology (CIBITEC23).FCC Construcción publishes its GHG emission report for 2022.FCC Construcción wins the contract for the extension of the Fira de Barcelona (Spain).FCC Construcción obtains the CO2 Performance Ladder Certificate, Level 5.Cementos Portland Valderrivas’ Alcalá de Guadaíra factory, near Seville, Spain, obtains ISO 50001 Energy Management System certification from AENOR, the Spanish standards authority.The Torre Realia\The Icon is rated “Outstanding” in the management category, the highest rating granted by BREEAM , thus joining a select group of 13 office buildings in the Autonomous Region of Madrid (Spain).Launch of the marketing strategy for "Residencial Provenza”, a development of Valaise, 43 protected rental homes. 1, 2, and 3-bedroom homes in the municipality of Tres Cantos (Madrid, Spain).Highlights of the year 2023 | Page 2 of 3

FCC. Annual Report 2023

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportMayJulyJuneAugustThe FCC Group receives a prize for best practices in internal communication for its you_diversity project.FCC Medio Ambiente renews its accession agreement to the Spanish Business and Biodiversity Initiative (Spain).FCC Medio Ambiente organises Solidarity with Ukraine events in Madrid and Barcelona with the participation of the 'És Per Tu' non-profit association (Spain).FCC announces a voluntary OPA (Public Acquisition Bid) on 7% of its capital stock for subsequent amortisation.FCC Medio Ambiente makes a public commitment to the Tent organisation at the European Business Summit to hire 300 refugees.FCC Ámbito becomes the second company in Spain to obtain the WEEELABEX certification for its WEEE management facility.Aqualia starts to manage supply and sewerage in Riohacha, capital of the department of La Guajira (Colombia).FCC Environment becomes a double winner at the Letsrecycle Awards for Excellence 2023 in Recycling and Waste Management with the award for Household Recycling Centre of the Year and for Contributing to Achieving Zero Emissions (Buckinghamshire, UK).Aqualia named Water Company of the Year 2022 at the Global Water Awards 2023.‘Ofiso 2023 Award’ granted to Aqualia for the best sustainable loan in 2022 for the corporate green syndicated loan of 1.1 billion euros.Participation in the 25th ANDESCO Congress held in Cartagena de Indias (Colombia).Aqualia takes part in the 13th AEDYR International Congress (Spanish Association of Desalination and Reuse) in Granada (Spain).#Actúa, the Aqualia 2021 Sustainability Report, finalist at the 6th “Ramón del Corral” Dircom Awards.FCC Construcción Chile completes the second section of the Parque Mapocho Río, the biggest urban environmental regeneration project in Chile.FCC Construcción Australia and Martinus sign an MoU on working together on railway infrastructure projects.FCC Construcción starts work on the new institutional HQ of the ONCE Social Group in Madrid (Spain).The Cementos Portland Valderrivas Group launches the first edition of its corporate magazine “Portland Contigo” (Portland Next to You) in which the company’s main milestones and news items are shared.Handover of keys to Realia’s “Glories Bcn” 47 homes with 2, 3 and 4 bedrooms and a shopping area (Barcelona, Spain).Construction begins on Realia’s “Hato Verde Soul” development.63 single homes with 3 and 4 bedrooms in Guillena (Seville, Spain).Start of refurbishment works on the foyer of the Castellana 41 office building (Madrid, Spain).FCC Medio Ambiente and FCC Ámbito develop solar energy infrastructures at their recycling plants (Spain).The Millerhill Recycling and Recovery Centre operated by FCC Environment will supply heat to the first community heating network in Midlothian (Scotland).FCC Environmental Services renews the contract for waste collection in the western area of Polk County (Florida, USA).Aqualia officially begins Phase 1 of operations for the Integral Management Improvement (IMI) project in Los Cabos, Baja California Sur (Mexico).New contract awarded to Aqualia in France for sanitation and water treatment in 41 municipalities in the Centre-Loire Valley region for six years.Aqualia wins the contract to operate and maintain three floating desalination plants in Saudi Arabia that will produce 50,000 m3 of desalinated water per day.Aqualia is awarded the work to extend the Fonsalía desalination plant in Santa Cruz de Tenerife (Canary Islands, Spain).FCC, third Spanish construction company worldwide according to Deloitte’s Global Powers of Construction (GPoC).FCC Industrial wins the contract to construct its first floating PV plant in Spain.The company’s CEO presents the Principle of Conduct and Action forming the Business Culture of the Cementos Portland Valderrivas Group and the main thrust of which is “Driving Sustainable Progress”.Start of marketingof “Residencial Provenza Phase I”: 50 protected rental apartments developed by Valaise. 1, 2 and 3-bedroom homes in Tres Cantos (Madrid, Spain).Launch of the marketing strategy for “Residencial Benevivere”: 98 apartments with 2, 3 and 4 bedrooms with excellent communal zones including a swimming pool and children’s play area in the municipality of Valdemoro (Madrid, Spain).FCC Medio Ambiente renews its commitment to the collection, cleansing and ground maintenance services of the city of Valencia (Spain).FCC Medio Ambiente awarded new waste collection contract in Ripollès (Girona, Spain).FCC Medio Ambiente renews waste collection and street cleansing contract for the city of Torrent (Valencia, Spain).Aqualia and NGO Asperga, from Spain, and Rotary E-Club Origen, from Colombia, launch local initiatives thanks to grants from IFM Investors.Aqualia participates in the Technology Transfer Seminars organised by Aqualia - AdTa (Águas do Tejo Atlântico), which belongs to the state corporation Águas de Portugal.Caltaqua begins digitalising remote reading by installing 17,000 remotely-controlled meters (Italy).FCC Construcción wins more than €670 million worth of infrastructure contracts in Spain.FCC Industrial and TotalEnergies start work on the project to build five PV plants in Spain.Launch of the marketing strategy for “Parque del Ensanche Phase III”: 113 homes with 2, 3 and 4 bedrooms and a shopping area. Common zones with SplashPark and Pet Spa which are joined to Phases I and II with swimming pool, landscaped zones and two padel courts.Start of refurbishment works on the Albasanz 14, Albasanz 16 and Avenida de Bruselas 36 office buildings (Madrid, Spain).FCC Construcción publishes its Strategy for Combating Climate Change 2023-2026.FCC Construcción wins the contract to construct the A-73 Burgos-Santander motorway and the Baix Llobregat motorway in Catalonia (Spain).Construction begins at Realia’s “Hato Verde Soul” development. 64 chalets with 3 and 4 bedrooms in Guillena (Seville, Spain).GroupEnd-to-end WaterManagement CycleInfraestructuresReal EstateCementEnvironment1_
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Highlights of the year 2023 | Page 3 of 3

FCC receives the 2023 Charity Award from
ONCE Social Group Region of Madrid.

Esther Koplowitz receives the Medal of
Honour for her contribution to medicine
and biomedical research.

FCC Servicios Medio Ambiente updates its
Green Financing Framework incorporating
taxonomic criteria (Spain).

FCC Medio Ambiente grows in the
Barcelona Metropolitan Area with the
contract for the operation of the Ecoparc 3
(Spain).

Inauguration of the Centre for Innovation in
the End-to-end Water Cycle at the
Salamanca WWTP (Spain) to develop
bioproduct generation projects.

Aqualia is recognised by the Federation
of Business Owners of Cádiz (Spain) for
its contribution to the SDG with the
“Sosteniblómetro” initiative.

The Sotra Link Consortium, of which
FCC Construcción forms part, starts
construction of the Sotra Connection
project, the largest suspension bridge
built digitally (Norway).

FCC Construcción attends the United
Nations’ Climate Change Conference.

FCC Construcción wins the contract
to bury the train track in Montcada
(Catalonia, Spain).

FCC Construcción recognised in the
XVI Spanish Biennial of Architecture and
Urbanism for its remodelling of Plaza de
España and its surroundings (Madrid, Spain).

Dragon Products Company, a subsidiary
of Giant Cement Holding Inc., in which the
Cementos Portland Valderrivas Group holds
a 45% stake, announces the wind-down of
operations of the furnace and the quarry at
the Thomaston, Maine plant in the USA.

Initiation of sales of FCC Inmobiliaria’s
“Residencial Pireo”, 108 multi-family homes,
2, 3 and 4 bedrooms, with ground floor
and penthouses in the municipality of
Tres Cantos (Madrid, Spain).

September

FCC implements an Energy and Zero Waste Policy.

Esther Alcocer Koplowitz, chairwoman of
FCC Group, receives the ‘Business Leader of
the Year Award’.

FCC Medio Ambiente obtains European funds
for the development of the PLAUSU project:
Autonomous Platform for Urban Services (Spain).

FCC Medio Ambiente awarded the waste collection
contract for the city of San Sebastián (Gipuzkoa,
Spain).

FCC Medio Ambiente highlights its achievements
and efforts in social and environmental
sustainability and innovation at the 2023 Smart
City Expo World Congress (Barcelona, Spain).

FCC Medio Ambiente launches the LIFE
ZEROLANDFILLING project to reduce the flow
of waste to landfill (Spain).

November

FCC Ámbito obtains the 2022 ‘Calculate-Offset’
seal awarded by the Spanish Office for Climate
Change (Spain).

Aqualia wins the new contract to supply
drinking and sanitation water in Santa María
de Guía (Gran Canaria, Spain), for a period
of 40 years.

Speech at the 5th Silk Road Forum in Tbilisi
(Georgia) with participants from more than
60 countries including political leaders and
representatives from international
organisations and financial institutions.

Aqualia collaborates in the 35th ANEAS Annual
Convention and Expo (National Association of
Water and Sanitation Entities) in Mexico.

FCC Construcción wins the contract to construct
the Rubi Line, Casa da Música-Santo Ovídio, of
the Oporto Metro (Portugal).

FCC Construcción wins the contract to construct
the PALLAS modern nuclear reactor for
medicinal uses (Netherlands).

FCC Construcción’s Neom tunnel project reaches
three kilometres of drilling (Saudi Arabia).

Aqualia gains the Diversity Leading Company
seal and renews the ‘Equality in Business-DIE’
distinction awarded by the Spanish Ministry
of Equality.

Construction begins at “Residencial Pireo”,
108 multi-family homes, 2, 3 and 4 bedrooms,
with ground floor and penthouses in the
municipality of Tres Cantos (Madrid, Spain).

FCC given the ECOFIN Image of Spain Award.

The King presents engineer Carlos Slim with the
‘9th Enrique V. Iglesias Award for Development
of the Ibero-American Business Space’.

The FCC Group Board of Directors approves
the OPA report.

FCC closes the sale of 24.99% of the
Environment area parent company for
965 million euros.

Completion of the agreement to sell 24.99%
of the capital of FCC Servicios Medio Ambiente
Holding, S.A.U. to CPP Investments.

FCC Medio Ambiente awarded the contract
for the refurbishment and operation of the
Las Calandrias Environmental Compound
(Cádiz, Spain).

Group

Infraestructures

Environment

Cement

End-to-end Water
Management Cycle

Real Estate

FCC Medio Ambiente delivers its AVANZA
Awards to four innovative, committed and
sustainable projects (Spain).

FCC Medio Ambiente to continue providing
facility management services for Bilbao City
Council (Biscay, Spain).

FCC Medio Ambiente renews the 2022
‘Calculate-Reduce-Offset’ seal awarded
by the Spanish Office for Climate Change
(Spain).

MITERD approves the Campo de Gibraltar
PERTE in Cádiz (Spain), a project submitted
by Aqualia and the public corporation
Arcgisa to digitalise the water cycle in eight
municipalities.

The Cartagua and Aquamaior services in
Portugal are awarded the “Exemplary quality
of water for human consumption seal”.

Photobiorefinery inaugurated for the Deep
Purple project at the treatment plant in
Linares (Jaén, Spain).

Aqualia celebrates the second edition of
the “i4U” Innovation Awards.

October

FCC Construcción completes the excavation of
the longest and deepest tunnel in Latin America,
the Guillermo Gaviria Tunnel (Colombia).

Convensa wins the contract for the complete
modernisation of the Madrid-Seville high-speed
railway line (Spain).

FCC Construcción’s Concepción Industrial
Bridge project passes the 50% complete (Chile).

The management team of Dragon Portland Ltd
and Dragon Alfa Ltd, accompanied by their six
best customers, visit the Mataporquera factory in
Cantabria, Spain.

Handover of the keys to Realia’s “Parque del Ensanche
Phase II”, development of 80 apartments with 2, 3
and 4 bedrooms in Alcalá de Henares (Madrid, Spain).

Launch of the marketing strategy for “Residencial
Provenza Phase II”, a development of Valaise, 102
protected rental homes. 1, 2, and 3-bedroom apartments
in the municipality of Tres Cantos (Madrid, Spain).

Launch of the Realia app in office buildings for
requesting services, reporting incidents, posting
the cultural agenda, exclusive discounts for
tenants, etc.

December

FCC implements a universal accessibility
management system.

In December, FCC completed the voluntary
OPA to amortise treasury shares.

FCC Servicios Medio Ambiente signs an
agreement for the acquisition of Urbaser's
UK affiliate.

FCC Medio Ambiente Iberia publishes
its ninth biennial Sustainability Report:
‘Aligned with the SDGs.’

FCC Ámbito completes the environmental
authorisation process for solar panel
recycling in its Cadrete facility (Zaragoza,
Spain).

FCC Environmental Services is awarded the
waste collection service in St. Johns County
(Florida, USA).

Aqualia and FCC Construcción complete the
extension of the Glina WWTP (Bucharest,
Romania).

Twelve projects are submitted by Aqualia
to the second call of the Water Cycle
Digitalisation PERTE.

Aqualia receives the ‘Impact Project
Investment of the Year’ award.

Aqualia takes part in the Salón des Maires
et des Collectivités Locales in France, backed
by the AMF (French Association of Mayors).

FCC Environment awarded the prestigious
Sword of Honour Award by the British
Safety Council (UK).

GWP opens its first multifunctional
operations centre to improve water service
in Tbilisi (Georgia).

FCC Environment begins construction
works on new Boston solar park
(Lincolnshire, UK).

FCC Construcción publishes the 2023
Environmental Communication report and
updates its 2022 Sustainability Report.

FCC Construcción completes a section
of Lima’s first underground metro (Peru).

FCC Construcción and Aqualia complete
the project to remodel and extend the
Glina waste-water treatment plant
(Bucharest, Romania).

The Cementos Portland Valderrivas
Group presents the Culture Awards
to members of its personnel judged
outstanding in terms of +Solidarity,
+Greenness and +Communication.

Initiation of sales of Realia’s “Hubara”
development. 44 apartments with
2, 3 and 4 bedrooms, in Las Palmas
de Gran Canaria (Canary Islands, Spain).

Launch of Realia’s new website.

Completion of the refurbishment works
on the foyers of the Albasanz 14 and
Albasanz 16 office buildings (Madrid,
Spain).

1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
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value creation

FCC in 2023

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Financial
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Sustainability
Report

FCC. Annual Report 2023

Key figures | Page 1 of 4

2. Key figures

Revenue. Millions of euros

2023 turnover by activity. %

Gross operating profit (Ebitda). Millions of euros

9,026

7,706

2.8%

-0.1%

6.8%

6,659

16.5%

42.7%

Environment

Construction

Water

Cement

Real Estate

1,311

1,127

1,529

+8.1%

+15.7%

+17.1%

Corporate and adjustments

+7.6%

+16.4%

+16.6%

2021

2022

2023

31.3%

2021

2022

2023

2023 Ebitda by activity. %

Ebitda margin. %

Investments. Millions of euros

5.5%

6.9%

42.3%

9.1%

11.1%

25.1%

Environment

Water

Construction

Cement

Real Estate

16.9%

17.0%

16.9%

1,062

1,105

558

Corporate and adjustments

+3.1%

+90.3%

+4.0%

2021

2022

2023

2021

2022

2023

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Net financial debt. Millions of euros

Total assets. Millions of euros

Earnings attributable to the parent. Millions of euros

3,226

3,193

3,100

14,242

15,282

16,718

580

591

315

+15.3%

-1.0%

-2.9%

+11.0%

+7.3%

+9.4%

+121.2%

-45.7%

+87.5%

2021

2022

2023

2021

2022

2023

2021

2022

2023

Portfolio of works and services. Millions of euros

Equity. Millions of euros

Financial leverage. Net debt / Total assets. %

40,274

41,621

6,146

22.7%

30,197

4,441

4,939

20.9%

18.5%

+2.7%

+33.4%

+3.3%

+52.7%

+11.2%

+24.4%

2021

2022

2023

2021

2022

2023

2021

2022

2023

FCC. Annual Report 2023

Key figures | Page 3 of 4

2.1.
Stock Market
Performance 2023

Evolution of the stock market
and share price

On the monetary policy front, the year 2023 was
characterised by the market’s conviction that we
were nearing the end of the process of rate hikes
on the part of the Federal Reserve (Fed) and the
European Central Bank (ECB) which started in 2022
and was aimed at halting the generalised increase
in prices, with its dangerous spiralling impact on
wages. Although the euro zone economy suffered
low growth, close to stagnation in some countries
during the year, it managed to avoid going into
recession, the greatest signs of which were seen
in April with the banking crisis in the United States,
which led to the rescue of several entities such as
Silicon Valley Bank and First Republic Bank, which
ended up being taken over by JPMorgan. In Europe,
lack of confidence in the sector led to the collapse
of Credit Suisse, which was acquired by its rival
UBS with support from the Swiss authorities.

Even so, the ECB raised interest rates six times in
2023, by a total of 200 basis points, while the Fed
did so four times for a total of 100 bps. The Fed
ended the process in July and the ECB did so in
September, thanks to the signs of easing inflation
and cooling of economic growth, a trend that
looks set to continue during the coming year. All
this in spite of the renewed upsurge in geopolitical
tensions. On top of the conflict in Ukraine, in
October war broke out between Israel and Hamas
in the Middle East.

According to the IMF’s forecast of October 2023,
world growth will have moderated from 3.5% in
2022 to 3.0% in 2023 and it estimates 2.9% for
2024, well below the historical (2000-19) average
of 3.8%. Growth of the advanced economies is
expected to slow to 1,5% in 2023 and 1.4% in 2024
as the tightening of policies starts to take effect.
For emerging markets economies, a moderate
decline is foreseen, from 4.1% in 2022 to 4.0%
in 2023 and 2024. Global inflation is expected
to decline at a constant pace, from 8.7% in 2022
to 6.9% in 2023 and 5.8% in 2024, due to the
hardening of monetary policy and with the help
of lower international commodity prices. In general,
core inflation is expected to fall more gradually,
and in most cases inflation is not expected to
return to the level set as target until 2025.

Growth in GDP (gross domestic product) of the
euro zone will also slow sharply, from 3.3% in 2022
to 0.7% in 2023 and 1.2% in 2024.

Spain has been one of the euro zone economies
with the biggest positive contribution to growth
of the zone, with the GDP growth forecast at 2.5%
in 2023 and 1.6% in 2024, and average inflation
forecast at 3.6% for 2023 and 3% for 2024.

As regards the stock market, the Spanish stock
exchange ended the year among the best in 2023.
It ended the year on 10,102.10 points, having
exceeded 10,258 points at the beginning of
December, its highest point since 2018. The index
rose by 22.8% from January, being surpassed, in
Europe, only by the Milan stock exchange, which
gained 28.0% over the course of the year.

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Key figures | Page 4 of 4

Annual evolution of FCC’s shares

In this context, FCC shares were also affected by
corporate transactions such as the scrip dividend
and the OPA (public acquisition offer) for 7% of the
company’s capital, which led to an increase of
65% in the share price over the course of the year.
At year-end, the share price was €14.56, a high
sof €15.40 having been reached on 21 December
and a low of €8.16 (adjusted for dividend) on
15 March 2023. FCC ended the year with a market
capitalisation of 6,350 million euros.

Trading

Total trading volume this year was over 14 million
securities, with a daily average exceeding
55,000 shares. The brokered volume is conditioned
by the level of market liquidity with a 9% estimated
free float and by the type of long-term minority
investors, with a long time as a shareholder and,
therefore, a low turnover ratio.

Variation (price)

75.0%

65.0%

55.0%

45.0%

35.0%

25.0%

15.0%

5.0%

Volume (shares)

1,200,000

1,000,000

800,000

600,000

400,000

200,000

January

February March

April

May

June

July

August

Sept.

Oct.

Nov.

Dec.

% Chg. FCC

1.1%

2.5%

-1.5%

1.9%

-1.9%

31.3%

2.0%

-1.5%

0.3%

0.7%

2.5%

18.4%

65.1%

% Chg. Ibex35

9.8%

4.0%

-1.7%

0.1%

-2.1%

6.0%

0.5%

-1.4%

-0.8%

-4.4%

11.5%

0.4%

22.8%

Business lines

Environment _ 93

End-to-end Water Management Cycle _ 135

Infrastructure _ 208

Cement _ 238

Real Estate _ 249

FCC. Annual Report 202351_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

Environment

1. Geographical platforms and sector analysis. Strategy _ 94

2. Activity in the Environment Area _ 103

3. Highlights Environment 2023 _ 104

4. Other highlights _105

5. Excellence and sustainability _ 117

6. Innovation and technology _ 123

FCC Servicios Medio Ambiente has surpassed
the results of the previous year,
achieving an annual turnover of €3,853.2 million
(+5.83%), a gross operating profit of
€646.7 million (+9.04%) and a profit before tax
of €296.9 million (+11.83%)

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

Environment | Geographical platforms and sector analysis. Strategy | Page 1 of 9

1. Geographical platforms
and sector analysis. Strategy

The Environmental Services Area of the FCC Group
has been delivering municipal services and end-to-
end waste management for more than 110 years,
serving today over 67 million people in close to
5,400 municipalities.

In 2023 the company operated in a total of 11
countries through a variety of services that reflect
its extensive experience in the industry, including:
collection, treatment, recycling, energy recovery
and disposal of municipal solid waste; public street
cleansing; maintenance of sewage systems; parks
and ground maintenance; treatment and disposal
of industrial waste or the recovery of polluted soils.

FCC Servicios Medio Ambiente Holding, S.A.U.,
backbone of the Environmental Services activities,
is structured into four geographical divisions or
business platforms:

Iberia: FCC Medio Ambiente Spain,
FCC Environment Portugal and FCC Ámbito
(Industrial Waste)

United Kingdom: FCC Environment UK

Central and Eastern Europe: FCC Environment CEE

United States: FCC Environmental Services

The destabilising effects of Russia's invasion of
Ukraine continued to be felt throughout the year,
although the influence on price, fuel and energy
indices was less marked than in the previous
period. FCC Servicios Medio Ambiente has
intensified its efforts in growth and cost restraint
and has achieved an outstanding performance
that has allowed it to surpass the excellent results
of the previous year, reaching an annual turnover
of €3,853.2 million (+5.83%), a gross operating
profit of €646.7 million (+9.04%) and a profit
before tax of €296.9 million (11.83%). The backlog
keeps at a record €13,284.4 million.

In 2023, FCC Servicios Medio Ambiente managed
24.7 million tonnes of waste and produced
4.9 million tonnes of secondary raw materials
(SRM) and refuse-derived fuel (RDF). The company
boasts over 800 operational waste management
facilities, out of which more than 220 are
environmental compounds performing waste
management and recycling, including
11 waste-to-energy projects with a capacity
of 3.2 million tonnes per year and 380 MW of
non-fossil electricity.

FCC. Annual Report 2023A1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023

Environment | Geographical platforms and sector analysis. Strategy | Page 2 of 9

As a significant milestone, in October 2023 the
FCC Group perfected the agreement for the sale
of a minority stake of 24.99% of the capital of
its subsidiary FCC Servicios Medio Ambiente
Holding, S.A.U. ("FCC Medio Ambiente") to the
Canada Pension Plan Investment Board
("CPP Investments"), through its subsidiary
CPP Investment Board Europe S.àr.l.

Furthermore, FCC Servicios Medio Ambiente
announced in December an agreement to acquire
Urbaser's activities in the United Kingdom through
its subsidiary FCC Environment UK.

Financially, in 2023 FCC Servicios Medio Ambiente
carried out the issuance of a six-year bond in the
European market for €600 million, fully subscribed.
It also carried out the annual renewal of the Euro
Commercial Paper notes programme for up to
€400 million.

Turnover 2023. Geographical platforms

9.12%

15.75%

2023

20.21%

54.92%

Iberia (Spain, Portugal, Ámbito)

United Kingdom

CEE - Central and Eastern Europe

United States

In 2023, FCC Servicios Medio Ambiente
managed 24.7 million tonnes of waste
and produced 4.9 million tonnes of secondary raw
materials (SRM) and refuse-derived fuel (RDF)

FCC. Annual Report 2023

FCC Medio Ambiente
Iberia (Spain, Portugal
and FCC Ámbito)

FCC Medio Ambiente provides environmental
services in almost 3,700 municipalities in Spain
and Portugal (FCC Environment), serving a
population of close to 33 million inhabitants with
activities including street cleansing, the collection
and transport, treatment and disposal of waste,
parks and ground maintenance, maintenance
of sewage systems, beach cleaning, and energy
efficiency services, among others. During the

2023 financial year, FCC Medio Ambiente Iberia
managed 11.8 million tonnes of solid waste.

The destabilising effects of Russia's invasion of
Ukraine continued to be felt throughout the year.
Although the influence on price indices, fuel and
energy has been less marked than in the previous
year, the upward pressure on wage costs has been
significant. FCC Medio Ambiente Iberia's efforts
to develop the business and optimise costs have
enabled it to achieve an excellent performance. In
2023, the portfolio figure reached a record
€8,418.1 million, with important renewals such
as the Collection and Cleansing service for the
northern area of the city of Valencia, where the
company has been present since 1957, and the

award of new contracts, such as the refurbishment
and operation of the Las Calandrias Environmental
Compound in Jerez de la Frontera (Cádiz, Spain).
The annual turnover has reached €2.116 billion
and the gross operating profit €314.7 million,
increases of 5.44% and 2.71% with respect to 2022.

In this environment, the company has continued
to develop its 2050 Sustainability Strategy and
has published the 21-22 ninth Sustainability
Report, aligned with the Sustainable Development
Goals and under the slogan "Leading the era
of change", which highlights the progress made
in the 20-22 Action Plan and presents the main
challenges of its new 23-26 Sustainability Action
Plan. Among the most relevant milestones in the

two-year period, the 28.9% increase in the recovery
of valuable materials and the 35.3% raise in the use
of renewable energies stand out.

Innovation is a paramount part of this Strategy,
an element within FCC Medio Ambiente’s DNA
and the basis of its competitive differentiation,
as evidenced by the significant investment figure
of close to €4 million in R&D&I in 2023. The
company has met the development milestones
of the low cab heavy-duty vehicle for urban service
applications on a chassis-platform with a 100%
plug-in electric engine, whose battery can be
recharged by a hydrogen fuel cell, called H2TRUCK.
It has also opened a new line of research in the
development of connected service equipment

Access here the 2050
Sustainability Strategy video

Access here the 21-22 Sustainability
Report Video-Summary

and autonomous driving with the PLAUSU project
(AUtonomous PLatform for Urban Services), also
recognised with funds from the Centre for the
Development of Industrial Technology (CDTI for
its acronym in Spanish) and co-financed by the
European Regional Development Fund (ERDF).
The year also saw the real commissioning
of numerous 100%-electric collection and
cleansing equipment developed by the company,
which continues to research both in the field of
Renewable Energy Vehicles, as well as in projects
that promote the Circular Economy,
or in Information and Communication
Technologies applied to services.

In 2024 FCC Medio Ambiente Iberia will continue
to focus on tenders for the development of
infrastructures to meet the demanding recycling
and landfill diversion targets of the European
Union and on the implementation of the separated
collection of the organic fraction, with support in
many cases from the European Next Generation
funds of the Spanish Recovery, Transformation
and Resilience Plan (PRTRE for its acronym in
Spanish).

The environmental services market in Portugal,
on the other hand, continues to evolve favourably,
with the award of the Waste Collection and Street
Cleansing contract in Vila Real.

Turnover 2023. Geographical location

Municipalities served 2023

Inhabitants served 2023

2,364

2,626

23,759,860

17,559,316

13,224,571

FCC. Annual Report 2023

23.0% Catalonia

18.8% Community

of Madrid

11.6% Valencian

Community

10.9% Andalusia

5.8% Basque Country

5.2% Aragón

4.5% Canary Islands

4.0% Castilla y León

3.1% Galicia

2.5% Murcia

2.0% Asturias

2.0% Navarre

1.8% Balearic Islands

1.4% Portugal

1.4% Extremadura

0.8% Castilla-

La Mancha

0.8% La Rioja

0.6% Cantabria

278

Waste
collection

Street
cleansing

Waste
processing
and recycling

Ground
maintenance

Sewerage

105

Beach
cleaning

Fountains

190

5,539,407

4,287,132

4,744,550

4,669,069

2,842,690

Facility
management

Waste
collection

Street
cleansing

Waste
processing
and recycling

Ground
maintenance

Sewerage

Beach
cleaning

Fountains

Facility
management

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report

Environment | Geographical platforms and sector analysis. Strategy | Page 5 of 9

FCC. Annual Report 2023

biennium in most of its facilities, thus
contributing to achieving the FCC Group's
decarbonisation and sustainability objectives.

In Portugal there has also been a certain
decrease in the number of tonnes treated, mainly
due to the absence of special operations this
year, but at the same time there continues to
be a recovery in activity with the main recurring
customers and a recovery in prices.

This year, the Industrial Waste activity will
continue to improve the efficiency of operations
and grow the business. The addition of new
technologies will enable FCC Ámbito to
strengthen its position in the waste recycling and
recovery markets, placing itself as a key player
in the circular economy.

Turnover 2023. Geographical location

FCC Ámbito

FCC Ámbito is specialised in the comprehensive
management of industrial and commercial waste,
recovery of by-products and decontamination
of soil. Through innovative solutions to make the
most of resources contained in the different types
of waste, FCC Ámbito has become a strategic
partner of industries and businesses that, aligned
with the circular economy, develop their activities
ensuring environmental, social and economic
sustainability. Overall, it boasts a total of 39
treatment centres in Spain and Portugal, which
represent 69 process lines that guarantee the
performance of the facilities. Internationally,
FCC Ámbito has a significant presence in Portugal,
where it operates through its subsidiary ECODEAL.

Within the Spanish market, a slight decrease
in tonnes of processed waste, mainly from
environmental liabilities, has been detected
throughout 2023. However, the result of
FCC Ámbito's activity is maintained, with a solid
recovery of margins from the lows of the economic
and pandemic crisis. The legislative changes that
are taking place promote greater control of the
traceability of waste by regional administrations,
a fact which, together with the entry into force
of extended producer responsibility, favours
management companies that possess end of
treatment facilities, as is the case of FCC Ámbito.

Regarding process optimisation and focusing on
reducing fossil fuel energy consumption,
FCC Ámbito is firmly committed to solar energy
with a major investment plan for the 2023-2024

22.2% Catalonia

3.2% Castilla y León

16.0% Community

of Madrid

2.0% Valencian

Community

12.6% Aragón

1.3% La Rioja

1.0% Castilla-

La Mancha

0.9% Navarre

0.6% Extremadura

12.4% Andalusia

11.0% Portugal

7.1% Basque
Country

5.3% Cantabria

4.2% Asturias

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report

Environment | Geographical platforms and sector analysis. Strategy | Page 6 of 9

FCC Environment UK

FCC Environment is one of the leading companies
in the United Kingdom for comprehensive waste
management and recycling and continues to focus
on harnessing the full potential of the resources it
manages, targeting greater volumes of recycling
whilst generating energy from waste that cannot
be cost-effectively recycled.

Across the country the company serves around
18 million citizens and it managed 6 million tonnes
of waste as a resource in 2023, generating around
115 MWe of green energy from non-recyclable
waste.

FCC Environment achieved revenues of close
to €780 million in 2023, with a gross operating
profit of €174.9 million and profit before tax of
€87.9 million, up 14.62% and 153.81% on 2022,
respectively, which constitutes an excellent
performance.

As the UK market evolves and government policies
change, there is increasing pressure to demonstrate
that ESG (Environmental, Social and corporate
Governance) criteria are being followed to achieve
objectives, and the company has worked hard to
evidence that it delivers real social value to the
communities it serves. It can now display
it to customers by measuring these activities, which
include such diverse initiatives as volunteering,
planting sapling trees, educating school children,
community clean-ups, driving carbon savings
through fuel efficiency or alternative fuels in
vehicles, or keeping items in use for longer by
encouraging a ‘repair and reuse’ mentality.

Thus, the measured economic figure of social
value brought forward by the company as a direct
benefit to the municipalities where it operates has
grown from £27,625 (about €32,200) in 2021 to
£317,352 (about €370,000) in 2023.

The company has also invested in a wide range
of waste management facilities that aim to
minimise the amount of waste going to landfill sites
by processing the material to ensure it reaches
its full potential as a valuable resource. The state-
of-the-art Material Recovery Facility (MRF) in
Reading, Berkshire, was the first in the UK to install
a self-teaching, AI-powered robotic waste picking
system, and the Midlothian waste-to-energy plant
in Scotland will soon be contributing to heat 3,000
homes, education and retail properties in the area.

In 2023 FCC Environment published its own
plan to achieve Net Zero Emissions and deliver
environmental excellence in everything it does, with
a consistent focus on social value, pushing for the
repair and reuse of items that still have a useful
life, increasing recycling aligned with Government
policy, greener fuels and vehicles and reclaiming
land for economic use, as well as enhancing
biodiversity in all its activities.

The UK recycling market will undergo major
changes in 2024, as producers of household
packaging will be required to pay for the full cost
of recycling or disposal of waste under the
Extended Producer Responsibility system.
A Return and Deposit Scheme will roll out and the
Simpler Recycling campaign will include flexible
plastics in household recycling separate collections,
food waste and kerbside glass collections, where
there is no such service at present. Medicines

FCC. Annual Report 2023

Regulatory Group (MRG) regulations will also
change to mandate a stricter testing regime and
response to change.

As for the company, it will continue to serve its
customers and communities with excellence
in the proper management of secondary raw
materials and the valorisation of its land holdings.

Inhabitants served 2023

16,649,000

1,255,000

Waste
collection

678,000

Street
cleansing

98,000

Ground
maintenance

57,000

Facility
management

Waste
processing
and recycling

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report4_

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

100

Environment | Geographical platforms and sector analysis. Strategy | Page 7 of 9

FCC Environment CEE

Turnover 2023. Geographical location

FCC Environment is one of the leading global
groups in Central and Eastern Europe (CEE) in the
end-to-end management of municipal solid waste
and the recovery of renewable energies, where
it serves 6 million inhabitants in 1,571 municipalities.
It applies innovative systems and state-of-the-
art clean technologies in the provision of quality
services, sustainable in the medium and long term
and adapted to the needs of customers.

The 2023 financial year, which exceeded €600 million
in turnover for the first time (€607 million), was very
successful for the company, with a gross operating
profit of €109.3 million (18% of turnover and +7.37%
over 2022). Overall, the year continued to be marked
by high inflation and low or even negative gross
domestic product growth.

The main drivers of the favourable Ebitda
development were the increase in waste collection
and treatment prices and the stabilisation of
secondary raw material prices (especially paper),
mainly in the Czech Republic; the overall good
development of the treatment business in Austria;
and a very favourable development in Hungary
during the second half of the year after having
signed mainly collection and treatment contracts
with the new global waste management operator
MOHU MOL.

43.77% Czech Republic

28.00% Austria

13.07% Poland

7.11% Slovakia

4.54% Hungary

2.42% Romania

1.09% Serbia

Inhabitants served 2023

Municipalities served 2023

4,590,639

1,218

1,327

3,022,967

457,000

468,900

Waste
collection

Street
cleansing

Waste
processing
and recycling

Ground
maintenance

44,000

Fountains

232,000

Facility
management

Waste
collection

Street
cleansing

Waste
processing
and recycling

Ground
maintenance

Fountains

Facility
management

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creationEnvironment | Geographical platforms and sector analysis. Strategy | Page 8 of 9

101

FCC Environmental
Services USA

FCC Environmental Services is one of the top
15 comprehensive solid waste management
and recycling companies in the United States. It
serves over 10.5 million Americans in the states of
California, Texas, Florida, Nebraska and Iowa and
in 2023 it managed 2.13 million tonnes of waste.

Just a few years after the start of the activity
in the United States, the market continues to
offer important growth opportunities in the field
of municipal solid waste management, both in
household and commercial collection as well as in
recycling and treatment activities.

Once again, business in 2023 has been exceptional,
with the award and renewal of several long-term
contracts in some of the main municipalities in
Florida, such as Polk and St. Johns counties. FCC
has also successfully completed the start-up of the
Palm Coast service awarded in 2022.

Total revenues in 2023 amounted to €351.6 million,
and the gross operating result reached €47.9 million,
respectively 42.2% and 37.24% more than in the
previous year and, with a backlog of €2.108 billion,
a very significant level of growth is also expected
for 2024. For the new financial year, the company's
strategy is to consolidate the commercial business
and continue with the vertical integration of
its activities, with the incorporation of waste
collection and treatment contracts or the potential
acquisition of businesses that fit within the
company's long-term strategy.

FCC Environmental Services kept consolidating
its commercial business with the integration of
the recently acquired Houston Waste Solutions
company in the Houston metropolitan area, which
will position FCC as one of the largest commercial
companies in the area.

The commercial division boasts a total of nine
locations across three states, Texas (Houston
and Dallas), Florida (West Palm Beach,
Daytona Beach, Port Saint Lucie, Tampa,

Lakeland and Orlando) and Nebraska (Omaha).
The division currently serves industrial customers
such as Exxon Mobil, Amazon, Dr Pepper, Greater
Omaha Meat Packing and major universities.

The commercial business growth strategy is
three-pronged. First, to sell front-loading and roll-off
services to small, medium and large companies.
Second, to expand the current customer portfolio
and market all additional services FCC can offer.
Third, to sell profitable business by harnessing
annual and off-cycle price increases.

In 2023 the commercial business line exceeded
budgeted revenues and profitability by 54% and
56% respectively. Year-on-year revenue growth
reached €24 million with the addition of 3,600 new
commercial customers of which 60% are retail,
30% industrial and 10% miscellaneous.

Inhabitants served 2023

Turnover 2023. Geographical location

5,727,935

4,772,300

Waste
Collection

Waste processing
and recycling

48.4% Florida

21.5% Texas

22.6% California

7.5% Nebraska

102

Presence of FCC Environmental Services in the USA

FCC Environmental Services Activity in the USA in 2023

Award of the contract for the collection
of municipal solid waste for St. Johns
County for the next 7+5+5 years (Florida).

Renovation work begins on the Placer
County Environmental Compound in
California.

Renewal of the contract for the collection
of municipal solid waste for the western part
of Polk County for the next 5+1+1+1 years
(Florida).

Start-up of the solid urban waste collection
contract for the city of Palm Coast (Florida).

Award of the contract for the waste
collection of the urban public school districts
of Volusia and Flagler counties for the next
3 years (Florida).

Renewal of the city of Huntsville's
recyclables contract for next year (Texas).

Renewal of the city of Garland's recyclables
contract for the next 2 years (Texas).

Integration of Houston Waste Solutions
(Texas).

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

103

Environment | Activity in the Environment Area

2. Activity in the Environment Area

5. Hungary

9. Spain

Barcelona

2. England

FCC Environment
West Cheshire and Chester

3. Poland

FCC Environment
Nowy Targ

Waste Disposal.
€40.35 million.

Herefordshire

Waste Collection.
€4.35 million.

Waste Collection and Treatment.
€1.5 million.

Lubliniec

Waste Collection and Treatment.
€1.5 million.

4. Austria

FCC Environment
Leibnitz

FCC Environment
Miscellaneous Waste Management for
MOHU MOL Waste Management Ltd.

6. Czech Republic

FCC Environment
Nošovice

Comprehensive Waste and Recycling
Management for Hyundai Motor
Manufacturing.
€10.8 million.

Vysoké Mýto

Comprehensive Waste and Recycling
Management at three IVECO plants.
€6 million.

Ostrava-Kunčice

Management of a Recycling Centre.

7. Romania

FCC Environment
Braila County

Operation of Integrated Waste
Management System Facilities
(zones 2 and 3).
€8.54 million.

8. Slovakia

FCC Environment
Hlohovec

FCC Medio Ambiente
Valencia

Lot 2 Waste Collection and Street
Cleansing (northern area of the city).
€525.89 million.

Jerez de la Frontera (Cádiz)

Refurbishment and Operation of the
Las Calandrias Environmental
Compound.
€317 million.

Torrent (Valencia)

Waste Collection and Street
Cleansing.
€101 million.

San Sebastián (Gipuzkoa)

Waste Collection.
€67.3 million.

Bilbao (Biscay)

Facility Management for the City Hall.
€53.4 million.

Sant Adrià de Besòs (Barcelona)

Operation of Ecoparc 3.
€28.3 million.

Lepe (Huelva)

Waste Collection and Street
Cleansing.
€27.06 million.

Santanyí (Mallorca)

Waste Collection.
€20.91 million.

Waste Collection and Treatment by
the AWM.
€1.5 million.

Collection, Transport, Disposal of
Waste and two Household Recycling
Centres.
€1.8 million.

Cleaning of graffiti and Removal
of other elements from the public
thoroughfare.
€14.57 million.

Badajoz

West Lot 2 Waste Collection for the
Environmental Municipalities
Association of the Regional Council.
€13.59 million.

San Miguel de Abona (Tenerife)

Waste Collection.
€13.17 million.

Alcudia (Mallorca)

Lot 1 Waste Collection.
€12.83 million.

Ripollès (Girona)

Waste Collection.
€12.5 million.

FCC Ámbito
Basque Country

Management of Environmental
Incidents and Emergencies and their
Waste for the Basque Government.

La Muñoza (Madrid)

Waste, Household Recycling Centres
and Treatment Plants Comprehensive
Management for IBERIA.

10. Portugal

FCC Environment
Vila Real

Waste Collection and Street
Cleansing.
€18.22 million.

1. USAFCC Environmental ServicesSt. Johns County (Florida)Waste Collection.€523.3 million.Polk County (Florida)Western area Waste Collection.€140 million.Volusia and Flagler counties (Florida)Waste Collection from Public School Districts.€2.8 million.1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

104

Environment | Highlights Environment 2023

3. Highlights Environment 2023

January

March

February

April

i
i

May

June

July

August

PLAY

September

October

November

December

FCC Medio Ambiente continues to provide municipal services for the city of Manresa (Barcelona, Spain).FCC Equal Comunidad Valenciana Special Employment Centre starts up new street cleansing service in the town of Massamagrell (Valencia, Spain).EnergyLOOP, company promoted by FCC Ámbito and Iberdrola, will build its innovative wind turbine blade recycling plant in the municipality of Cortes (Navarre, Spain).FCC Environment opens a new recycling centre for sorting plastic and paper waste in Ostrava (Czech Republic).FCC Environment starts up the Integrated Waste Management System in Brăila County, (Romania).FCC Medio Ambiente renews its accession agreement to the Spanish Business and Biodiversity Initiative (Spain).FCC Medio Ambiente organises Solidarity with Ukraine events in Madrid and Barcelona with the participation of the 'És Per Tu' non-profit association (Spain).FCC Environment becomes a double winner at the Letsrecycle Awards for Excellence 2023 in Recycling and Waste Management with the award for Household Recycling Centre of the Year and for Contributing to Achieving Zero Emissions (Buckinghamshire, UK).FCC Medio Ambiente and FCC Ámbito develop solar energy infrastructures at their recycling plants (Spain).The Millerhill Recycling and Recovery Centre operated by FCC Environment will supply heat to the first community heating network in Midlothian (Scotland).FCC Environmental Services renews the contract for waste collection in the western area of Polk County (Florida, USA).FCC Medio Ambiente obtains European funds for the development of the PLAUSU project: Autonomous Platform for Urban Services (Spain).FCC Medio Ambiente awarded the waste collection contract for the city of San Sebastián (Gipuzkoa, Spain).FCC Medio Ambiente highlights its achievements and efforts in social and environmental sustainability and innovation at the 2023 Smart City Expo World Congress (Barcelona, Spain).FCC Medio Ambiente launches the LIFE ZEROLANDFILLING project to reduce the flow of waste to landfill (Spain).FCC Ámbito obtains the 2022 ‘Calculate-Offset’ seal awarded by the Spanish Office for Climate Change (Spain).FCC Medio Ambiente sends a shipment of basic necessities to Ukraine with the collaboration of 'És Per Tu'.FCC Ámbito launches the PV4INK project for the recycling of photovoltaic panels (Spain).FCC Environmental Services breaks ground at the Placer County Environmental Compound in California (USA).FCC Medio Ambiente makes a public commitment to the Tent organisation at the European Business Summit to hire 300 refugees.FCC Ámbito becomes the second company in Spain to obtain the WEEELABEX certification for its WEEE management facility.FCC Medio Ambiente renews its commitment to the collection, cleansing and ground maintenance services of the city of Valencia (Spain).FCC Medio Ambiente awarded new waste collection contract in Ripollès (Girona, Spain).FCC Medio Ambiente renews waste collection and street cleansing contract for the city of Torrent (Valencia, Spain).Completion of the agreement to sell 24.99% of the capital of FCC Servicios Medio Ambiente Holding, S.A.U. to CPP Investments.FCC Medio Ambiente awarded the contract for the refurbishment and operation of the Las Calandrias Environmental Compound (Cádiz, Spain).FCC Medio Ambiente delivers its AVANZA Awards to four innovative, committed and sustainable projects (Spain).FCC Medio Ambiente to continue providing facility management services for Bilbao City Council (Biscay, Spain).FCC Medio Ambiente renews the 2022 ‘Calculate-Reduce-Offset’ seal awarded by the Spanish Office for Climate Change (Spain).FCC Servicios Medio Ambiente signs an agreement for the acquisition of Urbaser's UK affiliate.FCC Medio Ambiente Iberia publishes its ninth biennial Sustainability Report: ‘Aligned with the SDGs.’FCC Ámbito completes the environmental authorisation process for solar panel recycling in its Cadrete facility (Zaragoza, Spain).FCC Environment awarded the prestigious Sword of Honour Award by the British Safety Council (UK).FCC Environment begins construction works on new Boston solar park (Lincolnshire, UK).FCC Environmental Services is awarded the waste collection service in St. Johns County (Florida, USA).FCC Servicios Medio Ambiente updates its Green Financing Framework incorporating taxonomic criteria (Spain).FCC Medio Ambiente grows in the Barcelona Metropolitan Area with the contract for the operation of the Ecoparc 3 (Spain).FCC. Annual Report 2023

105

Environment | Highlights Environment 2023 | Page 1 of 12

4. Other highlights

CPP Investments completes the acquisition
of 24.99% of FCC Servicios Medio Ambiente
Holding, S.A.U.

and in 2022 it managed over 1.5 million tonnes
of waste. Urbaser's activities in the UK account
for around 5% of Urbaser total revenues.

As a significant milestone, in October 2023 the
FCC Group perfected the agreement for the sale
of a minority stake of 24.99% of the share capital
of its subsidiary FCC Servicios Medio Ambiente
Holding, S.A.U. ("FCC Medio Ambiente") to
the Canada Pension Plan Investment Board
("CPP Investments"), through its subsidiary
CPP Investment Board Europe S.àr.l.

FCC Servicios Medio Ambiente reaches
agreement for the purchase of Urbaser's
affiliate in the UK

FCC Servicios Medio Ambiente has agreed to
buy the business of Urbaser's affiliate in the
United Kingdom. The estimated enterprise value
of the transaction (including debt and equity) is
£398 million (around €464 million). The deal is
expected to be completed in the second quarter
of 2024, subject to the fulfilment of certain
conditions customary in this type of transactions.

Urbaser entered the UK market in 1998 and its
businesses and operations include municipal waste
collection, recycling, treatment and street cleansing
activities and it boasts household recycling,
composting, materials recovery, energy recovery
and disposal centres. The business serves over
12 million citizens, has more than 1,700 employees

Santander Corporate & Investment Bank acts as
financial advisor to FCC Servicios Medio Ambiente
in the transaction and Linklaters is acting as legal
advisor.

FCC Servicios Medio Ambiente has been present
in the UK market since 1989 through its affiliate
FCC Environment UK and is one of the top five
waste management local operators. The acquisition
of Urbaser's UK business will enable it to expand its
product and service offering and enhance the value
proposal for its customers.

FCC Servicios Medio Ambiente updates its
Green Financing Framework incorporating
taxonomic criteria

This new Green Financing Framework is a
reflection of FCC Servicios Medio Ambiente's
ongoing commitment to sustainability, which
began in 2019 with the previous framework and
was boosted in 2021 with the launch of its 2050
Sustainability Strategy.

The Framework follows the Green Bond and Loan
Principles set out by the International Capital
Market Association (ICMA) and the Loan Market
Association (LMA), as it encompasses short and
long-term bond and loan financing products. As

a novelty, in updating the framework, a reference
to the EU Taxonomy has been included in order to
establish a link between the projects to be funded
through this new version of the Framework and
the sustainable activities defined in EU Taxonomy.
This innovative character allows the company,
backbone of the FCC Group's environmental
activities, to highlight its ambition to align the use
of funds with a positive environmental impact with
climate mitigation and adaptation objectives of
the EU Taxonomy Regulation. In this regard
it should be noted that, according to the data
reported for the 2022 financial year, approximately
83% of FCC Servicios Medio Ambiente's eligible
activity is aligned with the objectives of EU
Taxonomy. All Green Projects incorporated in
the Framework provide clear environmental
benefits and promote the transition to low-carbon
technologies.

106

FCC Medio Ambiente reaffirms its commitment
to Valencia city services

FCC Medio Ambiente awarded the contract for
the modernisation and operation of Las Calandrias
Environmental Compound in Jerez de la Frontera (Cádiz)

FCC Medio Ambiente renews the contract for waste
collection and street cleansing in the city of Torrent
in Valencia

Valencia City Council has once again trusted FCC Medio Ambiente
with the street cleansing and urban waste collection and transport
contract for lot 2 for €525.89 million over a 15-year period. The
company has been present in the city since 1957. The contract
boasts a workforce of over 550 people to serve 365,000 inhabitants,
collect around 140,000 tonnes per year and cover an area of
2.3 million square metres. The nearly 200 service vehicles and
machines will have ECO and Zero Emission environmental labels.
The more than 2,000 container islands will have a container for each
fraction and the new electric bicompartmentalised vehicles
for maintenance tasks will enable the simultaneous selective
collection to be reinforced with the minimum environmental impact.
1,600 sensors, locking systems and user identification equipment
will be installed, as well as filling buoy sensors. Two mobile household
recycling centres will be added.

Jerez de la Frontera City Council awarded FCC Medio Ambiente
the contract for the modernisation and operation of Las Calandrias
Environmental Compound, which will serve over 450,000 inhabitants
of the area. The contract is worth €317 million for the next 20 years,
with a possible one-year extension, and the work is expected to be
completed in 18 months. The planned investment reaches €40.8
million and aims to provide the facilities with state-of-the-art recycling
technology, with maximum flexibility and modularity to meet the
European Union’s recovery targets. The total capacity of the plant will
be 260,000 tonnes per year. It will boast photovoltaic panels, a system
to minimise odours, new refining lines, a compost and biostabilised
material storehouse and a leachate treatment facility.

FCC Medio Ambiente renewed its contract for waste collection and
street cleansing in Torrent, where it has been present since 1996.
The service, worth €101 million over the next 14 years, will have a
staff of nearly 100 people and a fleet of 65 vehicles to serve the city's
more than 85,000 inhabitants. All of the service's new equipment
has an ECO or Zero Emission environmental label, 80% electric and
20% powered by Compressed Natural Gas (CNG). The entire fleet of
containers is being renewed; the collection of the organic fraction is
being introduced throughout the municipality as well as door-to-door
collection in the old town. Solar panels will also be installed on the
roof of the machinery depot. In order to promote social sustainability,
women victims of gender violence and people with disabilities will
join the workforce.

107

FCC Medio Ambiente to continue providing municipal
services for the city of Manresa (Barcelona)

FCC Medio Ambiente with Ukraine

FCC Medio Ambiente renews its commitment to the city
of San Sebastián (Gipuzkoa)

FCC Medio Ambiente will continue to provide waste collection
and street cleansing services for the city of Manresa, where it has
been present uninterruptedly since 1993. The contract is worth
€91.4 million over the next ten years and will serve nearly 80,000
inhabitants. The service boasts a staff of 145 people and a fleet
of 54 vehicles. It shows Manresa City Council's commitment to
sustainability and a cleaner environment for the city, with significant
reductions in CO2 emissions and noise pollution thanks to the new
service machinery, a large proportion of which will be Zero-Emission
electric. In addition, solar energy panels will be installed in the
service’s central depot.

On the occasion of the first anniversary of the invasion of Ukraine,
the company launched an internal campaign to raise funds and
collect basic necessities that culminated in the transport by road of a
shipment to the Polish-Ukrainian border, from where it was distributed
to families affected by the conflict. This campaign and shipment was
made possible thanks to the collaboration of the "És Per Tu" non-
profit organisation, different branches and people from FCC Medio
Ambiente. Following the reception of the shipment, the company held
two "Solidarity Days of Commitment to Ukraine" at its headquarters
in Madrid and Barcelona to raise awareness of the situation of the
Ukrainian refugees, thank the staff for their solidarity and continue to
demonstrate FCC Medio Ambiente’s social vocation.

San Sebastián City Council awarded the contract for waste collection
to the RSU Donostia joint venture, led by FCC Medio Ambiente,
for €67.3 million. The company has been providing the service
uninterruptedly since 1990. The contract, which serves over
187,000 residents, includes 33 newly acquired sustainable vehicles,
40% fully electric, which will drastically reduce noise, pollutant and
CO2 emissions, and will incorporate several units of the multi-award-
winning ie-Urban truck on the industrial chassis-platform for electric
mobility for urban services developed by FCC Medio Ambiente. The
service has a staff of 70 people and foresees the collection of more
than 53,000 tonnes of waste annually. The aim of this renewal is
to reach 65% of recycled waste by 2035 and to achieve 57.42% of
selective collection.

108

FCC Medio Ambiente to continue providing
facility management services for Bilbao
City Council (Biscay)

FCC Medio Ambiente grows in the
Barcelona Metropolitan Area with
the contract to operate Ecoparc 3

Bilbao City Council has once again awarded to
a joint venture led by FCC Medio Ambiente the
facility management service contract for the City
Hall and other dependent entities that the company
has been providing since 1993. The contract
amounts to €53.4 million for the next four years
with a possible extension of one more year and
will cover over 350,000 square metres spread
over 170 centres and the city's only funicular
railway. The service will boast a staff of around
400 people and will incorporate newly acquired
Zero-Emission environmental-labelled machinery
to join the existing electric fleet. It will also install
small household waste recycling centres for non-
containerised selective collection (toner, batteries,
etc.) on the public thoroughfare.

The Barcelona Metropolitan Area has awarded
FCC Medio Ambiente, in a joint venture with another
company in the sector, the new contract to operate
Ecoparc 3, located in the town of Sant Adrià de
Besòs. The contract is worth €28.3 million for
the next three years, with two possible one-year
extensions. The company is already present in
two of the four compounds that treat waste from
the city of Barcelona and its metropolitan area. It
is foreseen to manage 198,000 tonnes of residual
waste and 60,000 tonnes of organic waste per
year. During the execution of the contract, a tender
is planned to refurbish the facility, so that the
biological system will change from treating the
organic matter contained in the residual fraction
to processing the organic fraction collected
selectively.

FCC Medio Ambiente awarded new waste collection contract in Ripollès (Girona)

Ripollès County Council awarded FCC Medio
Ambiente the new waste collection contract for
over €12.5 million for the next six years to serve
the 25,200 inhabitants of the 19 city councils
that make up the county. To collect the 11,500
tonnes of waste per year, the service boasts
15 vehicles and 21 people. The service will be
monitored by GPS systems in all vehicles and radio

frequency identification (RFID) tags on containers.
Environmental objectives are set, namely to
improve selective collection by 2% per year to
reach an increase of 12%, which will mean a
recycling rate of 50.88% by the end of the contract.
The service also includes the management of a
waste transfer plant given the remoteness of the
final recycling facilities.

109

The EnergyLOOP company receives the backing of Next Generation Funds and signs an
agreement with SURUS to advance the energy transition and boost circular economy

FCC Ámbito starts up recycling photovoltaic
panels activity

EnergyLOOP, company owned by FCC Ámbito
and Iberdrola for the recycling of wind farm
components, has signed a collaboration agreement
with SURUS, a leading Spanish company in adding
value through the implementation of sustainability
and circular economy projects, with the aim of
providing a joint solution for the recycling of wind
turbine blades in wind farm repowering projects.
Under the agreement, SURUS will provide a flow of
elements from those projects where it implements
its circular dismantling solution and EnergyLOOP
will recycle those blades that have not been
marketed for reuse.

EnergyLOOP's activity will begin with the start
of operation of its innovative plant located in
the municipality of Cortes in Navarre (Spain) in
2024, which will involve an investment of close to
€10 million. It will be the first industrial-scale plant

in Europe and will place Spain at the technological
forefront of this sector. The company expects
to create around 100 direct and indirect jobs
over the decade. To promote the construction of
this facility, EnergyLOOP submitted the project:
ADVANCED MULTIPURPOSE RECYCLING OF
AEROGENERATOR BLADES (RAMPA for its
acronym in Spanish) to the "Circular Repowering"
programme within the framework of the Recovery,
Transformation and Resilience Plan financed by
the European Union - Next Generation EU, from
which it received a grant of close to €2.9 million.

Following the successful completion of start-up
tests, the Aragonese Institute for Environmental
Management granted final authorisation to
FCC Ámbito's photovoltaic panel recycling plant.
Located in Cadrete, Zaragoza (Spain), it offers the
sector a solution for recycling its panels. The plant
is integrated into FCC Ámbito's glass recycling
activity, thus achieving direct recovery of the glass,
the main material of the panels. The treatment
technology is exclusively mechanical and
environmentally more sustainable as it does not
generate any waste flow other than the materials
that make up the panels. The facility will give a new
life to 200,000 panels per year and has required an
investment of €1 million.

Expansion of Industrial Waste activity
in Portugal

Industrial waste business is expanding in Portugal
with the acquisition of the company Resicorreia,
which has two operational waste treatment
facilities, one in in the north, in Sertã, and the other
in Loures, near Lisbon. A site adjacent to Ecodeal’s
location has also been acquired in pursuit of a
future expansion.

110

FCC Ámbito and Iberdrola extend their
collaboration in circular economy in Spain
to develop battery recycling solutions
together with Glencore

FCC Ámbito and Iberdrola will collaborate with
Glencore to provide industrial-scale lithium-ion
battery recycling solutions in the Iberian Peninsula
through the development of a specialised facility.
This alliance will seek to establish the strategic
arrangements necessary for the effective recovery
of lithium batteries, extending the positive impact
of the initiative to other actors along the entire
value chain. It will also contribute to the research
and development necessary for the effective
circularity of these materials. In this way,
FCC Ámbito and Iberdrola extend the collaboration
they began with EnergyLOOP to address the
recycling of wind turbine blades and reinforce
their circular economy strategies, with a production
and consumption model that is a key lever for the
energy transition.

Renewal of the contract for Environmental
Emergencies of the Basque Country region

Renewal of Iberia's waste management
contract

The Basque Government has awarded FCC Ámbito
one of two lots of the contract for the management
of environmental incidents/emergencies and waste
generated, consisting of dealing with incidents
likely to have an environmental impact in the
region, as well as the collection of waste generated
in emergency situations. With the renewal of this
contract, FCC Ámbito will continue to provide
technical assistance to the Basque Government's
department of Environment and Territorial Policy
for another two years, with the possibility of a
further two-year extension.

After four years of service to Iberia España, the
Western branch of FCC Ámbito has renewed the
contract for the comprehensive management of
waste generated by this company at its La Muñoza
facilities in Madrid (Spain) for a further two years.
The awarded services include the management
and maintenance of the waste recycling centre, the
treatment plant of the physicochemical treatment
line and the WWTP facility, as well as the collection
and management of hazardous
and non-hazardous waste.

Renewal of the urban waste collection and
street cleansing service in the municipality
of Vila Real

FCC Environment has renewed the Vila Real
waste collection and street cleansing contract for
a period of ten years for a value of over €18.22
million. It serves 49,574 inhabitants and includes
the collection of organic and residual waste, as well
as the maintenance and washing of containers.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportIberia. FCC ÁmbitoIberia. FCC Environment PortugalEnvironment | Highlights Environment 2023 | Page 7 of 12

111

Construction work begins on Boston's new solar park

FCC Environment to supply heat to Midlothian's first district heating network

FCC Environment commenced construction of
a new landfill solar park in Boston, Lincolnshire,
which will generate around 10,500 MWh, enough
to power 2,900 homes. The project is located on
a site of over 12 hectares and is being developed
in accordance with the methodology approved
by the UK Environment Agency to promote
biodiversity. It is planned to introduce a range of
new high-value habitats, increase nesting and

feeding opportunities for birds, provide shelter and
breeding facilities for reptiles and amphibians
and relocate existing orchids. To protect the
existing landfill cap engineering, a large proportion
of the solar foundations will be above ground
and will use recycled aggregate. The solar park
is scheduled to be operational in June 2024.

The Millerhill Recycling and Energy Recovery
Centre (RERC) operated by FCC Environment will
supply heat to the first district heating network in
the county of Midlothian. The Midlothian Energy
Limited joint venture has taken a step forward
towards the regeneration and decarbonisation
of the area by supplying low carbon heating
to newly built homes via an underground pipe
network. This year alone, the RERC plans to

feed 100,000 MWh into the network, supplying
3,000 homes, schools and businesses and
avoiding the emission of over 2,500 tonnes of
CO2. This initial heat supply will be the catalyst
for a wider regional network stretching into South
Edinburgh and East Lothian.

112

Completion of the Suffolk Recycling Centre
redevelopment

Work completed on new solar park
in Winterton

FCC Environment double winner at the 2023 Letsrecycle Awards for Excellence
in Recycling and Waste Management

The new and improved Foxhall household recycling
centre in Ipswich opened to the public in December
following the completion of redevelopment works
ahead of schedule. The new facility increases
capacity for vehicles, improves access from
Foxhall Road and reduces queuing on the highway.
It also has a new raised level construction which
gives better access to containers for users without
the need for stairs.

FCC Environment's new solar park in Winterton has
reached project completion. Developed on a former
landfill site, the park generates circa 4,300 MWh
of renewable energy each year, enough to power
more than 1,300 homes.

FCC Environment won two awards at the 2023
Letsrecycle Awards for Excellence in Recycling and
Waste Management. On the one hand, it received
the 'Household Recycling Centre of the Year' award
for its High Wycombe facility in Buckinghamshire,
where public entities, citizens and the company
have collaborated to make a real and measurable
difference to the volume of recycling. In addition,
it was awarded in the 'Contribution to Achieving

Zero Emissions' category for ‘Reuse and Repair’.
Committed to achieving Net Zero targets and
reducing its carbon footprint, FCC Environment
believes that repair and reuse are fundamental
to avoiding emissions because they extend the
lifespan of items, thus reducing the manufacture
of new products.

113

Contract with MOHU MOL Waste
Management Ltd. (Hungary)

FCC Environment was awarded the waste
management contract by MOHU MOL Waste
Management Ltd. (owned by the Hungarian oil
company MOL). FCC provides waste collection
and management services for a total value of
€5.2 million and acts as a partner in the landfill,
composting and mixed packaging waste collection
service for an order book value of €10.4 million per
year. The contract began on 1st July 2023.

Renewal of the contract with Hyundai Motor
Manufacturing Czech s.r.o. in
Czech Republic

FCC Environment has once again renewed the
contract for the comprehensive complex waste
management of Hyundai Motor Manufacturing
Czech, which it has been providing since 2008
and which represents a total order book value of
€10.8 million. The service, which began on 1st
November for the next three years, covers the
collection, transport and subsequent treatment
of all waste produced, including secondary raw
materials.

FCC Environment to continue providing services for Iveco Czech Republic, a.s.,
Vysoké Mýto (Czech Republic)

FCC Environment will provide diverse outsourcing
services (emptying of containers at the location
where the waste is generated, waste management,
supply of equipment and employees) for Iveco
Czech Republic at three different plants in Vysoké
Mýto, with whom it has been working since 1998.

The prior three-year contract, which included the
collection, disposal and further processing of
secondary raw materials, expired on 31st December
2022 and has been extended for three more years.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportCentral and Eastern Europe. FCC Environment CEEEnvironment | Highlights Environment 2023 | Page 10 of 12

114

Renewal of contracts in Poland

FCC Environment has renewed the contract for
the collection and treatment of municipal waste
from the city of Nowy Targ with 24,000 inhabitants,
worth almost €1.5 million and with a duration of 12
months. The company has also signed the renewal
of the contract for the collection and treatment of
waste from the town of Lubliniec. For this contract,
FCC will collect solid urban waste, selective raw
materials and organic waste from more than
20,000 inhabitants over the next year. The expected
turnover of the service amounts to €1.5 million.

AWV Leibnitz (Austria)

FCC Environment in Austria has been awarded
a contract by the Leibnitz Waste Management
Association (Abfallwirtschaftsverband AWV) for
the next five years to begin on 1st January 2024.
It secures 9,000 tonnes of household waste per
year for FCC's Halbenrain (Styria) treatment plant
and generates an annual revenue of approximately
€1 million. The special feature of this contract is
that the transport to the treatment plant and the
subsequent transfer of processing residues to the
incineration plant will be carried out by electric
lorry.

Integrated Waste Management System in Braila in operation (Romania)

FCC Environment started up the contract awarded
in 2021 to operate two of the three areas of the
Braila County Integrated Waste Management
System for a period of seven years and an order
book value of €8.54 million. The company has
been appointed to operate the INSURATEI Transfer
Station with an annual capacity of 5,000 tonnes
serving 46,000 inhabitants; and the management
and operation of the IANCA Integrated Waste

Management Centre, which consists of a landfill
and a waste sorting plant with an annual capacity
of 5,000 tonnes. The facilities were built and
equipped through a €5 million project co-financed
by the European Regional Development Fund.
FCC Environment's investments in Romania to
ensure the optimisation and conditions necessary
for the operation of these facilities amount to over
€130,000 until 31st December 2023.

Renewal of the contract of the city
of Hlohovec (Slovakia)

FCC Environment renewed its contract with the
city of Hlohovec for the collection, transport
and disposal of municipal waste, as well as the
operation of two household waste recycling
centres. The company has been providing services
in the city since 2006. The contract is worth €1.8
million and is valid until 31st December 2024.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportCentral and Eastern Europe. FCC Environment CEEEnvironment | Highlights Environment 2023 | Page 11 of 12

115

Polk County renews its trust in FCC
Servicios Medio Ambiente

Polk County (Florida) has once again awarded
FCC Environmental Services the contract for
municipal solid waste collection in the western
area of the county. The renewal represents an
order book value of up to $155 million (about

€140 million) for a maximum of five years and
three possible one-year extensions. The new
service, which serves more than 200,000 people,
represents an investment of $20 million (about
€18 million) and will incorporate a fleet of 38
state-of-the-art, compressed natural gas (CNG)
collection vehicles, as well as the setting up of
a CNG refuelling station in its facilities.

Expansion of Municipal Collection services
in Florida

Two new school contracts awarded
in Florida

The Board of Commissioners of St. Johns County
in Florida has awarded FCC Environmental
Services the contract for the solid waste collection
service, worth a total of up to $575 million
(€525.3 million). The initial contract spans 7 years,
with the potential for two 5-year extensions, and
will begin on 1st August 2024. The service will
attend over 300,000 residents and involve a major
investment of $42 million (€38.3 million) including
the acquisition of a CNG-powered fleet of 62 new
collection lorries and 13 ancillary vehicles.

FCC Environmental Services has been awarded
two new contracts for waste collection from public
school districts in Volusia and Flagler counties
for the next three years. The awards represent a
portfolio of up to $3 million (nearly €2.8 million)
and will serve nearly 110 schools in both counties,
a total of nearly 75,000 students. Services under
both contracts will be provided from the company's
facility in Volusia County.

116

Commissioning of the Palm Coast
contract (Florida)

FCC Environmental Services started up the

municipal solid waste collection service for the

city of Palm Coast, located in Flagler County, on
1st June, which was awarded in July 2022. The
contract represents a backlog of $175 million

(about €163.3 million) for a term of up to ten years.

Palm Coast is a city of 90,000 people and since the

company rolled out the service, over 1,000 homes
have been built and settled in. The company

has added 35 trucks to its fleet, 30 of them

CNG-powered, operating from the Volusia facility.

Management and operation of the Placer
environmental recycling compound
continues (California)

The Municipal Solid Waste Management Authority
of Placer County awarded FCC Environmental
Services the contract for the construction
and operation of the environmental recycling
compound for a total of $1.5 billion (about
€1.4 billion). During 2023, operations have
further developed and the MSW recovery rates
established in the contract have been achieved.
New equipment has also been installed for the
treatment of construction and demolition waste
(C&D), capable of processing 60 tonnes per hour
of C&D and recovering 60% of the material.

City of Huntsville contract renewal
(Texas)

Renewal of the contract of the city
of Garland (Texas)

The city of Huntsville has extended the contract
with FCC Environmental Services for the
management of recyclables for one more year.
The overall annual revenue from this contract will
amount to $200,000 (about €184,000).

FCC Environmental Services has renewed the
city of Garland's contract for the transportation
and treatment of recyclable waste and its
subsequent marketing for a period of two years.
Annual revenues associated with the treatment of
recyclable materials in the region reach €1 million
(€923,000).

5. Excellence and sustainability

2021-2022 biennial
Sustainability Report

FCC Medio Ambiente has presented its 2021-2022
ninth biennial Sustainability Report, aligned
with the SDGs and verified by an independent
external entity. Under the slogan ‘Leading the
era of change,’ the report highlights the progress
made in the 20-22 Action Plan and presents the
main challenges of its new 23-26 Sustainability
Action Plan, within the framework of its 2050
Sustainability Strategy, which will mark the
company's development over the next few years.
The Strategy revolves around four main lines of
action: Environmental, Social, Excellence and
Governance, within which the Action Plan includes
17 strategic objectives, 176 commitments and
282 compliance indicators.

Regarding the progress made on the commitments
within the 20-22 Action Plan, the report offers
a figure of 79.2% of achievements and 9.4% of
targets ‘under way’. Some of the most relevant
milestones include the commitment to the circular
economy, with the renewal of accession to the
Pact for the Circular Economy and an increase of
28.9% in the valorisation of recoverable materials.
In terms of efficiency in the use of resources, there
has been 35.3% increase in the consumption of
renewable energies (2020-2022) and 25% increase
in water consumption from alternative sources.
In terms of the fight against climate change,
in 2022 the company avoided the emission of
3,333,990 tonnes of CO2e.

The 23-26 Sustainability Action
Plan considers 17 strategic
objectives, 176 commitments
and 282 compliance indicators

We support the Sustainable Development Goals

Leading
the era of
change

2021-2022 sustainability report

FCC. Annual Report 2023A1_ Financial StatementsA2_Sustainability ReportEnvironment | Excellence and sustainability | Page 1 of 61_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesEnvironment | Excellence and sustainability | Page 2 of 6

AVANZA Awards

The AVANZA awards were created with the aim
of recognising the work and efforts made by
the people of the organisation who contribute
on a daily basis to improving the company's
competitiveness, social integration within the
business, quality of processes, respect for the
environment and the development and application
of innovative solutions or practices. All this
within the scope of the organisation's ongoing
commitment to sustainable development, the
promotion of well-being at work and research,
development and innovation. These awards,
whose first edition was held in 2017, are given
every two years and are meant for all business
units within the Environmental Services area.

This year's edition, under the slogan ‘Together,
we create the future,’ 22 initiatives competed in the
categories: Social Initiatives, Quality, Environment
and Innovation. The following projects received the
top awards:

Social Initiatives

Quality

118

Programme for the integration of groups at risk of exclusion into the
labour market.

Use of new technology to control 100% of the weighing of litter bins in the
San Sebastian-Donostia beach cleaning.

Author: Madrid branch.

Author: Gipuzkoa – Navarre branch.

Environment

Innovation

Small dimensions rear-loading bi-compartmentalised compact-collection
lorry on a hybrid electric chassis.

Zero Waste and circular economy at the Refrigerator Recycling Plant.

Author: Industrial Waste Eastern branch.

Author: Machinery department.

Service excellence

FCC Medio Ambiente’s commitment to excellence
benefits its entire value chain, from customers,
suppliers, employees and, of course, to all citizens
living in the communities the company provides
service in, mainly public customers.

Both FCC Medio Ambiente and FCC Ámbito have
implemented an Integrated Management System
based on the requirements by international
standards of recognised prestige that ensure a
management model based on excellence, which
integrates, as its name implies, sections as varied
as quality, environment, occupational health and

safety (OHS), R&D&I, energy efficiency, healthy
organisation, quality in tourism and information
security, among others. This system establishes
a working methodology that guarantees that
processes are carried out with rigour, applying
sustainability criteria and in accordance with
common procedures.

The following graph shows the historical evolution
of the certifications and accreditations obtained by
FCC Medio Ambiente and FCC Ámbito:

119

Certifications and accreditations obtained by FCC Medio Ambiente and FCC Ámbito

FCC MEDIO AMBIENTE CARBON FOOTPRINT REGISTRY
(SINCE 2013)

UNE-EN ISO 9001

OHSAS
18001 - PRL

UNE-EN-ISO/
IEC 17020-
ACCREDITATION

UNE 166002 - IDI

UNE-EN ISO 45001
OCCUPATIONAL
RISK PREVENTION

UNE-EN 27001:2014
UNE-EN 1176-7:2009
UNE-EN 16630:2015

FCC ÁMBITO
CARBON
FOOTPRINT REGISTRY

1997

2000

2005

2007

2012

2013

2016

2018

2019

2020

2021

2022

2023

UNE-EN ISO 14001
ENVIRONMENT

(CE) EMAS

Regulation

UNE EN 15713
CONFIDENTIAL
PAPER
SHREDDING

HEALTHY
COMPANY
MODEL

UNE-EN ISO
50001

Q QUALITY
TOURISM
ESP-25-AUD-17

ACTION
PROTOCOLS AGAINST
COVID-19

NATIONAL
SECURITY SCHEME

WEEE
TREATMENT

Sustainability and excellence highlights in 2023

In 2023, the carbon footprint corresponding
to the previous year's data was verified. For
the third year in a row, FCC Medio Ambiente
obtained once again the "Calculate-Reduce-
Offset" seal awarded by the Spanish Office
for Climate Change (OECC for its acronym
in Spanish), the scope of which includes
the calculation, reduction and offsetting of
emissions associated with the consumption
of electricity, fuel, landfill, composting,
biomethanisation, energy recovery of waste
and hydrofluorocarbon (HFC) leaks generated

by the organisation's activities. The company
has thus managed to reduce its average
emission intensity by 0.67% in the 2020-2022
three-year period compared to the previous
three-year period. To achieve this reduction,
FCC Medio Ambiente is working on key aspects
in the fight against climate change, such as the
sustainability of its vehicle fleet, improvements
in waste treatment facilities and the generation
of renewable energy.

120

In 2022, the company collaborated in a certified
reforestation project that will span over the
next 40 years in an area of 40 hectares located
in the Monte de Utilidad Pública No. 60 "Valle
de Iruelas", belonging to the Asocio de Ávila
Municipalities Association and included
within the Natural Reserve of the same
name. This area, which is home to one of the
most important colonies of black vultures in
Europe, was burnt down in 2019, making it
urgent to restore it in order to halt the erosive
processes and re-establish the regulation of the
hydrological cycle. This is why 80,000 trees have
been planted, including wild pine and birch trees.

FCC Ámbito successfully completed the process
of verifying its carbon footprint and entering the
‘Carbon Footprint, CO2 Offsetting and Absorption
Projects Registry’ established by the Ministry
for Ecological Transition and the Demographic
Challenge. For the 2022 financial year, it has
obtained the ‘Calculate-Offset’ seal awarded by
the OECC, whose scope includes the calculation
and offsetting of emissions associated with
the consumption of electricity, fuels, industrial
waste landfills, industrial waste treatment and
hydrofluorocarbon (HFCs) leaks generated by
the activities carried out by the organisation.

CERTIFICADO DE INSCRIPCIÓN
Registro de huella de carbono, compensación y proyectos de absorción de
CO del Ministerio para la Transición Ecológica y el Reto Demográfico

FCC MEDIO AMBIENTE, S.A.U.

Año de cálculo

2022

Tipo de sello

CALCULO, REDUZCO Y COMPENSO

Alcances

1+2 y 3

Límites

Alcance 3 incluye las emisiones indirectas asociadas al consumo de electricidad,
combustible, depósito de vertedero, compostaje, biometanización, valorización
energética de residuos y fugas de HFCs.

Se incluyen las actividades desarrolladas en sus 20 sedes: servicios de recogida,
transferencia, transporte, almacenamiento, tratamiento, eliminación y valorización
(incluida la valorización energética) de residuos; servicios de limpieza viaria y de
parques, conservación de parques, jardines y zonas verdes, mobiliario urbano y
juegos infantiles, de alcantarillado, de fuentes y de playas, costas y aguas litorales;
limpieza y mantenimiento de edificios e instalaciones industriales, de sistemas de
protección contra incendios; servicios energéticos y de gestión integral de
instalaciones eléctricas; investigación, caracterización y descontaminación de
suelos y acuíferos; organización de actividades y eventos deportivos y de ocio,
alojamiento y restauración e impartición de programas de educación ambiental.

Reducción

0,61 % de la media de la intensidad de emisión en el trienio 2020-2022 respecto
del trienio 2019-2021, para el alcance 1+2 y 3.

Compensación

0 % de su huella de carbono de alcance 1+2 y 3.

Realizada con las unidades: 2021-b111/02150-02167

CERTIFICADO DE INSCRIPCIÓN
Registro de huella de carbono, compensación y proyectos de absorción de
CO del Ministerio para la Transición Ecológica y el Reto Demográfico

FCC ÁMBITO, S.A.U.

Año de cálculo

2022

Tipo de sello

CALCULO Y COMPENSO

Alcances

1+2

Límites

Se incluyen las actividades de servicios de recogida, transferencia, transporte,
almacenamiento, tratamiento, eliminación; gestión de instalaciones y operaciones
asociadas, gestión de: puntos limpios y centros de recogida y reciclaje, plantas de
transferencia, vertederos y plantas de tratamiento y operaciones de recogida y
destrucción de papel confidencial, gestión de residuos como agentes y negociantes
y asistencia técnica en materia de residuos en emergencias ambientales; así como
la investigación, caracterización y descontaminación de suelos y acuíferos,
desarrolladas en su sede central situada en Madrid y sus cuatro delegaciones
situadas en Zaragoza, Barcelona, Córdoba y Alcorcón (Madrid).

Compensación

0,03 % de su huella de carbono de alcance 1+2

Realizada con las unidades: 2022-b242/00140-00157

Valvanera Ulargui Aparicio

Directora General
Oficina Española de Cambio Climático
Ministerio para la Transición Ecológica y el Reto Demográfico

Fecha de inscripción: 10/10/2023

Cód. huella de carbono: 2023-a2302

Cód. compensación:

2023-c161

2013-2023 Evolution of FCC Medio Ambiente’s Carbon Footprint

Valvanera Ulargui Aparicio

Directora General
Oficina Española de Cambio Climático
Ministerio para la Transición Ecológica y el Reto Demográfico

Fecha de inscripción: 07/11/2023

Cód. huella de carbono: 2023-a2374

Cód. compensación:

2023-c166

2_
Ethical governance
at the highest level

Environment | Excellence and sustainability | Page 5 of 6

121

In 2023, FCC Ámbito, through its subsidiary
InduRaees, obtained the WEEELABEX
certification for the treatment of refrigeration
equipment in its Waste Electrical and Electronic
Equipment (WEEE) management plant located
in Osorno (Palencia, Spain). This accreditation
recognises best practices in the treatment of
this type of waste, and aims to develop and
provide quality, service and tools to promote the
use of the best WEEE management facilities
on the market. FCC Ámbito has thus become
the second company in Spain to obtain this
certification.

On the tenth anniversary of its launch in 2013,
FCC Medio Ambiente renewed its membership
agreement with the Spanish Business and
Biodiversity Initiative (IEEB for its acronym
in Spanish), a public-private collaboration
platform that seeks to involve the business
sector in the improvement and maintenance
of biodiversity and natural capital, coordinated
by the Biodiversity Foundation of the Ministry
for Ecological Transition and the Demographic
Challenge (MITECO for its acronym in Spanish).
The company's sustainability commitments,
set out in its 2050 Sustainability Strategy,
include the protection of natural capital in the
management of its services, understanding
cities as ‘ecosystems that are home to urban
biodiversity’. Being part of the IEEB is a further
step towards fulfilling the commitments of the
environmental axis of this Strategy in terms of
biodiversity.

FCC Environment received the British Safety
Council's prestigious Sword of Honour, which
recognises companies that achieve excellence
in occupational health and safety and
environmental management. This is the third
time that the organisation has been recognised,
having previously received the award in 2017
and 2020. On this occasion it was given to the
company's Green Energy division for the five-star
rating received in the audit of the Eastcroft
waste-to-energy plant. This has enabled FCC
to be one of only 115 organisations worldwide
to receive this award.

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122

Environment | Excellence and sustainability | Page 6 of 6

Other sustainability highlights

FCC Ámbito received the ‘Circular Aragón Seal’
for its glass recycling activity, awarded by the
Government of Aragon, for its contribution
to circularity throughout the value chain, the
fulfilment of best practices and the actions for
process improvement such as participation in
R&D&I projects.

Over 2023, FCC Medio Ambiente collaborated
and participated in the development of
three forestry management projects, two
in collaboration with the Galician Forestry
Association (one through FCC Medio Ambiente
and another through FCC Ámbito) and one in
collaboration with the Hellín City Council in
Albacete (Spain).

After commissioning two photovoltaic power
plants in Linz and Himberg in the past two
years, FCC Environment Austria has begun five
new projects to increase its renewable energy
production. By 2026 the company will thus cover
about 25% of its electricity consumption by
photovoltaic energy. These measures are aligned
with its goal of becoming self-sufficient in terms
of electric power by 2035.

FCC Environment installed solar panels on the
roof of the Ostrava-Hrabová office building in
the Czech Republic. The power of the plant is
15 kWp and it will produce 16,000 kWh per year,
covering approximately 9% of the building's total
consumption.

FCC Environment, which carries out waste
and recycling collections as well as ground
maintenance on behalf of Harborough District
Council in the UK, has been supporting the
community to plant nearly 5,000 hedge whips
which have been supplied free of charge by
the Leicestershire County Council and The
Conservation Volunteers, with a further 2,500
whips to be planted in 2024.

The Las Tablas building, headquarters of the
FCC Group in Madrid (Spain), received in 2023
the ‘Zero Waste’ certification, which means that
over 90% of all waste generated in the building
is being recovered. The AENOR Zero Waste
specification has been implemented
in the building since 2021 with the support
of FCC Medio Ambiente.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

Environment | Innovation and technology | Page 1 of 12

123

6. Innovation and technology

Throughout 2023, FCC Servicios Medio Ambiente
kept on developing innovation projects and, for
yet another year, upheld the certification of its
R&D&I Management System, in accordance with
the UNE 166002 standard.

R&D&I projects in development or launching phase
reached an investment of close to €4 million
throughout the year. They are classified into four
areas of knowledge:

Vehicles, mobile machinery and facilities

Management and recycling of waste – Circular
Economy

Information and Communication Technologies

Sustainable development

Vehicles, mobile
machinery and facilities

Projects associated to vehicles
and mobile machinery

H2TRUCK Project

Since the end of 2021, FCC Medio Ambiente
has been developing a low cab heavy-duty vehicle
for urban service applications on a chassis
with a 100% plug-in electric engine, whose
battery can be recharged by a hydrogen fuel cell,
called H2TRUCK, as part of the Programme for
Sustainable Automotive Technology (PTAS for its
acronym in Spanish) within the framework of the
funds granted by the Centre for the Development
of Industrial Technology (CDTI for its acronym in
Spanish) and supported by the Spanish Ministry
of Science, Innovation and Universities (MICIN for
its acronym in Spanish) as part of the Recovery,
Transformation and Resilience Plan financed by
the European Union.

FCC. Annual Report 2023A1_ Financial StatementsA2_Sustainability ReportEnvironment | Innovation and technology | Page 2 of 12

Hydrogen Truck Tower of components.

124

The company thus differentiates itself in the
provision of urban services through excellence
in the environmental, technical and economic
features of its offer. Although the initial prototype
is a large-tonnage solid waste compactor collector,
the developing chassis will be versatile and can be
adapted to different types of bodywork to provide
a variety of urban services in the future. In addition,
a mobile hydrogen compression and refuelling

Funded by
the European Union
NextGenerationEU

(cid:31)(cid:30)(cid:30)(cid:29)(cid:28)(cid:27)(cid:26)(cid:31)(cid:25)(cid:30)

station has been developed from scratch so that
the prototype vehicle can be quickly and safely
refuelled and tested at any location.

Building on the achievements established in 2022,
especially the characterisation of the fuel cell on
the test bench at the National Hydrogen Centre
(CNH2) located in Puertollano (Ciudad Real, Spain),
FCC Medio Ambiente has continued working on
the project throughout 2023, with the completion
of the design and development of all systems
to be incorporated in the vehicle, the trial and
bench testing of the entire power train, including
the electronic management of the fuel cell and
the lithium-ion battery at the University Institute
for Automotive Research (INSIA in Spanish). In
addition, the final production of the prototype
has begun, both chassis and bodywork, and it is
expected that both the prototype and the hydrogen
refuelling station will be available in 2024.

GOBIERNO
DE ESPAÑA

MINISTERIO
DE CIENCIA
E INNOVACIÓN

(cid:31)(cid:30)(cid:30)(cid:29)(cid:28)(cid:27)(cid:26)(cid:31)(cid:25)(cid:30)

EUROPEAN UNION
European Regional Development Fund
“A way of making Europe”

PLAUSU Project: Autonomous Driving

In 2023 FCC Medio Ambiente established another
line of research and development for the coming
years: autonomous driving and connected vehicle
technology in the field of urban services. The
aim of the project is to research and develop
automation technologies, specifically focused on
the operation in autonomous mode of a platform
for urban service vehicles in cleansing tasks, and to
materialise these technologies on a dual washing
down-sweeper vehicle that already incorporates a
fully electric driving and propelling system.

The project, named ‘Autonomous Platform
for Urban Services’ (PLAUSU), has received funds
for the CDTI and is co-financed by the European
Regional Development Fund (ERDF). The project
has a two-year execution period and is being
carried out in collaboration with INSIA.

The system will have a tablet or similar device
for remote control where the user will be able
to supervise and correct the performance of the
machine, as well as control the ancillary cleaning
elements. Navigation of the washing-down and
sweeping vehicle will be reinforced with GPS
positioning and LiDAR (Light Detection and
Ranging) perception, using a digital map with the
location of fixed elements. In areas where GPS
coverage is insufficient, perception sensors will be
used for guidance and positioning.

125

Other electric mobility projects

The following research projects, launched in 2022,
have been consolidated this year and now the first
series of vehicles are already operating in Spanish
cities such as Madrid and Valencia:

Tanker manufactured in high density copolymer
(polyester reinforced with fibreglass, GFRP), for
street watering and washing down tasks with
front water jets and sprinklers, upper pole and
double rear reel, 2 metres wide (non-existent
on the market), on a fully electric chassis with
a state-of-the-art European-made lithium-ion
battery, also 2 metres wide and maximum
authorised mass (MAM) of 18 tonnes (with the
possibility of being registered up to 19 tonnes).

New side-loading bodywork on a 26-tonne
Compressed Natural Gas (CNG) chassis for
the washing of containers with capacity from
1,100 to 3,200 litres, with an aluminium washing
chamber and maximum clean water capacity of
up to 9,750 litres. Special internal and external
washing pumps allow a whole working day's
washing without having to refill water, which
reduces down time, increases performance and
consequently decreases the vehicle's energy
consumption and pollutant emissions.

Green vehicles in Wychavon's fleet
(United Kingdom)

Fuel savings from new fleet of power
shovels in the United Kingdom

FCC Environment added eight vehicles powered
by Hydrotreated Vegetable Oil (HVO) to its waste
and recycling collection service in the Wychavon
district of Worcestershire. These vehicles reduce
by 90% CO2 emissions compared to those powered
by diesel, and their implementation constitutes
an intermediate stage in the transition towards
electric mobility. This is part of a process in which
the Wychavon District Council, in partnership
with FCC Environment, will invest £270,000 (circa
€315,560) to ensure that all city service vehicles
are powered by HVO.

FCC Environment has invested in a fleet of
Cat® 966 XE wheel loaders after seeing an annual
fuel saving of £11,000 (€12,835) per machine. Data
showed that over a six-month period the machines
had achieved a 29% reduction in fuel consumption.
Based on this, over a seven-year life cycle, and
with a standard repair and maintenance warranty
programme, the machines will collectively deliver
savings of over £250,000 (€292,000).

126

Projects associated to facilities

Robotic waste sorting system at the
Dallas plant in Texas (USA)

FCC Environmental Services' first waste sorting
robot was installed at the Dallas plant in March
and has been jointly funded by the Carton Council
of North America (CCNA) and the Foodservice
Packaging Institute (FPI). The AMP Generation 4.3
robot operating at 40-60 picks per minute is
programmed to separate carton and paper cups on
the quality control line, along with any Polyethylene
Terephthalate (PET) bottles containing liquid that
were not picked by optical sorters. This machine
has allowed the Dallas government, which collects
domestic recyclables, to manage cartons from
nearly half a million households. The robot has
driven down the plant's residue tonnage by 4%,
with a corresponding increase in recovered
materials for sale to a paper mill and reduction of
disposal costs.

Fire suppression system for the new
C&D waste line at the Placer County
environmental compound in California
(USA)

Due to the size of the equipment, the height of
the canopy and the wall-less structure of the new
demolition and construction (C&D) waste facility
at the Placer County environmental compound,
a solution different from the conventional fire
detection systems had to be found. A regular
system would not detect a fire from the tipping
floor in time as, given the characteristics of the
plant, it would have probably spread by the wind
and the air draft. Therefore, a system designed
by Fire Rover has been installed which uses 12
thermal cameras and 24 hosepipes to monitor the
entire structure, equipment, etc. 24 hours a day,
7 days a week. The hoses are connected to the
municipal water network so that the resource is
unlimited, giving the fire brigade a greater reaction
capacity.

Construction of several CNG stations in Florida (USA)

FCC Environmental Services has successfully
completed the construction of two CNG refuelling
stations in 2023. On the one hand, Lake County
required a refuelling station for its new CNG
vehicles. Built by Opal Fuels, it was commissioned
in September and has the capacity to refuel

40 vehicles. On the other hand, the Volusia refuelling
station expansion has been completed to service the
Palm Coast contract. FCC Environmental Services
commissioned Clean Energy to expand the existing
facility with an additional 45 fuelling stations in
addition to the existing 40.

127

Management and
recycling of waste.
Circular economy

Recovery of critical raw
materials from Municipal
Solid Waste (MSW)

Recovery of slag from MSW incineration

Funded by
the European Union
NextGenerationEU

(cid:31)(cid:30)(cid:30)(cid:29)(cid:28)(cid:27)(cid:26)(cid:31)(cid:25)(cid:30)

Europar Batasunak
kofinantzatua

Co-funded by
the European Union

Europar Batasunak
kofinantzatua

Co-funded by
the European Union

Funded by
the European Union
NextGenerationEU

Photovoltaic panels recycling

FCC Ámbito launched the PV4INK project to
develop technologies for the recovery of the silver
contained in photovoltaic panels and its conversion
into nanoparticles that can be used directly in the
conductive ink industry for electronic applications.
The project will run for three years and involves the
participation of TECNAN, LEITAT and LUREDERRA,
with funding from the State Research Agency,
part of the Ministry of Science, Innovation and
Universities (MICIU, for its acronym in Spanish),
within the framework of the call for Public-Private
Collaboration Projects, co-financed by the Spanish
Government's Recovery, Transformation and
Resilience Plan. It will be carried out at an
FCC Ámbito plant in Zaragoza, which will install
a line for the treatment of photovoltaic panels at
the end of their useful life, scheduled to be
commissioned in 2024.

MINETHIC: Promoting the recovery and
valorisation of strategic mineral resources
for the green transition

Official website of the project: www.minethic.es

The MINETHIC project, led by FCC Medio Ambiente
and subsidised by the CDTI with support from
the MICIU, is co-financed by the Recovery and
Resilience Mechanism. The goal of the project is to
research new sources of non-conventional mining
raw materials for the green transition. FCC Medio
Ambiente will be responsible for concentrating
phosphorus, nickel and cobalt present in the slag
from waste incineration, as well as phosphorus in
biostabilised material from biological treatment of
municipal solid waste. During 2023, microbiological
research was conducted at the Multisectoral
Research Technology Centre (CETIM for its acronym
in Spanish) for the bioaccumulation of phosphorus
with PAO microorganisms (Poliphosphate
Accumulating Organisms) using FCC Medio
Ambiente's biostabilised material.

ECO2D4.0 (ZL-2023/00884): Development
of comprehensive road surface solutions
using priority waste from the Basque
Country, and ecosystem for the functional
and environmental monitoring of road
infrastructures

FCC Medio Ambiente is participating in a project
co-financed by HAZITEK 2023, the Basque
Country's Business R&D Support Programme,
which seeks to research new applications for
waste management in the region. It focuses on
cases with limited recovery options, such as
ferrosite, incineration slag, foundry sands, milling
refuse and black slags. Products from digitised
ECO-roads are being developed, exploring the
technical and market feasibility of using different
waste streams as secondary aggregate in
pavement design. Complementary materials seek
to obtain sustainable layer solutions, ensuring
compliance with functional and environmental
specifications at all stages of development.

RSU4HOM: Development of new
construction products from the valorisation
of incineration slags from municipal solid
waste

Led by FCC Medio Ambiente and co-financed by
the HAZITEK 2022, the project is planned to last
30 months, from July 2022 and with a scheduled
end date of December 2024.

RSU4HOM aims to minimise the environmental
impact generated by the landfilling of incineration
slag from two plants in Zubieta (Gipuzkoa, Spain).
The aim is to recover this waste and integrate it as
aggregates for the manufacture of construction
materials (concrete, mortar and precast concrete).

Leading a circular economy for plastic

Co-funded by
the European Union

128

LIFE ZEROLANDFILLING (LIFE-2022-SAP-ENV 101114213): Recovering landfill waste
through an innovative and integrated process committed to the circular economy

LIFE PLASMIX (LIFE18 ENV/ES/000045:
Plastic Mix Recovery and PP & PS Recycling
from Municipal Solid Waste) (2019-2024)

LIFE4FILM (LIFE17 ENV/ES/000229:
Post-consumption film plastic recycling
from municipal solid waste) (2018-2022)

Official website of the project:
www.zerolandfilling.com

The LIFE ZEROLANDFILLING project, led by
FCC Medio Ambiente, addresses the increase in
urban waste generation through an innovative
system for the management and recovery of non-
recyclable waste, mainly plastics and bio-waste.
The consortium includes CEPSA, ECOCUADRADO,
NEOLIQUID, the University of Alcalá and
Ecomesa (subsidiary of FCC Medio Ambiente).
It is expected to treat 2,112 tonnes of waste,
avoiding 2,069.76 tonnes of CO2e associated with
landfilling. The recovery process will produce
458 tonnes of green naphtha and 583 tonnes of
solid coal, avoiding the generation of 918.56 and

1,700.26 tonnes of CO2e, respectively. The project
promises a sustainable zero landfill solution,
low carbon footprint and circular economy, with
environmental and economic impact in Europe.
It is expected to reduce 160,000 tonnes of waste
and 355,222.65 tonnes of CO2e per year over 3
years, consolidating the European waste treatment
sector. In 2023, the kick-off meeting was held and
administrative work, licensing, basic engineering
and selection of sites for prototypes have begun.

Official website of the project:
www.lifeplasmix.com

This project, led by FCC Medio Ambiente, is aimed
at demonstrating the material recovery of Plastic
Mix from municipal waste (PP, PS and EPS) in a
semi-industrial plant located at the Ecocentral
plant, Granada (Spain). During this year, the
processes for obtaining recycled pellets from
Plastic Mix for the manufacture of added-value
products have been optimised.

Official website of the project: www.life4film.com

Project carried out by a consortium led by
FCC Medio Ambiente and co-financed by the
European LIFE programme, with the aim of
avoiding sending plastic film (LDPE) present in
urban waste to landfill or energy recovery through
the implementation of innovative recycling on
a semi-industrial scale by means of a recovery
line of 11,000 tonnes per year at the Ecocentral
in Granada. During 2023, the work has been
completed, concluding the project achieving its
objective, proof of which are the ECOSAC bags
being distributed already, obtained from recovered
plastic film.

129

Environment | Innovation and technology | Page 7 of 12

Leader in renewable energy

FCC Medio Ambiente is committed to converting
the “Waste Treatment Centre” (WTC) into a
“renewable energy producer”. To this end, it has a
line of research for the development of innovative
processes for the production of hydrogen and
methane by means of biological treatments
(bioH2 and bioCH4) from waste, as well as
thermochemical processes such as gasification
and biogas purification.

(cid:31)(cid:30)(cid:30)(cid:29)(cid:28)(cid:27)(cid:26)(cid:31)(cid:25)(cid:30)

Funded by
the European Union
NextGenerationEU

ECLOSION: New materials, technologies
and processes for the generation, storage,
transport and exploitation of renewable
hydrogen and biomethane, generated from
bio-waste (2021-2024) MIG-20211071

In 2023, a novel depacker has been installed
that will enable the obtention of organic waste
streams free of impurities, thus optimising the
dark fermentation process. During 2024, dark
fermentation tests will be carried out on a scale
prototype at the Valladolid WTC.

FCC Medio Ambiente carried out research in the
laboratories of the University of Valladolid (Spain)
with the aim of studying the dark fermentation
process using Organic Fraction of Municipal Solid
Waste (OFMSW) as a substrate. As a result, a
significant amount of hydrogen was obtained out
of the total biogas generated in each fermentation.
The development of new, efficient and low-cost
polymeric membranes has also been completed
for the separation of biohydrogen mixtures from
dark fermentation (H2/CO2) and H2/CH4 mixtures
from syngas purification.

Sorting of undesirable matter.

130

Biorefineries

Creation of new by-products
and biomaterials

Funded by
the European Union
NextGenerationEU

INSECTUM: Recovery of urban by-products
and biowaste through bioconversion with
insects to generate innovative products in
strategic sectors

BIOPROLIGNO (CPP2022-009647):
Transformation of lignocellulosic waste
into bioproducts for their application in
infrastructure and ground maintenance

CDTI’s CIEN programme project, led by FCC Medio
Ambiente, which consists of the implementation
of an innovative system for the recovery of urban
bio-waste based on its bioconversion by means
of insects into products with high added value for
industry (human and animal food, nutraceuticals/
pharmaceuticals, fertilisers and chemicals).

FCC Medio Ambiente participates in the
conditioning and supply of the OFMSW for
its subsequent recovery. 2023 has seen the
completion of the project, allowing the first results
of the bioconversion of urban waste into valuable
products to be obtained.

The BIOPROLIGNO project is funded by the
Spanish State Research Agency under the 2023
Public-Private Partnership programme. It started
in 2023 and has a planned duration of three years.
This project aims to develop experiences in the
field of lignocellulosic waste pyrolysis, where
three state-of-the-art bioproducts are generated:
wood vinegar, charcoal and biochar. These have
demonstrated their effectiveness in laboratory
and experimental tests, and the project intends
to use them in real experiences in the field of
maintenance of linear infrastructures and green
areas, so that they can offer an improvement in
the management of woody urban waste.

Gas station at the Ecocentral plant in Granada (Spain).

LIFE LANDFILL BIOFUEL (LIFE18 ENV/
ES/000256: Integral management of the
biogas from landfills for use as vehicle fuel)
(2019-2022)

Official website of the project:
www.landfillbiofuel.eu

Project co-financed by the European LIFE
programme which aims to demonstrate the
technical and economic viability of a solution
based on the implementation of new landfill
exploitation techniques to improve biogas

production and facilitate the recovery of waste
gases through the purification of biogas by
means of an adsorption process through vacuum
pressure oscillation. The gas station has been
installed at the Granada Ecocentral plant where
the first refuelling with the biomethane obtained
has been carried out. During 2023, different tests
were conducted with the biomethane generated,
verifying that all of them comply with current
regulations. Likewise, this year, light and heavy-
duty vehicles have travelled over 30,000 and
almost 40,000 kilometres respectively with the
biomethane produced from landfill biogas.

131

Co-funded by
the European Union

LUCRA (101112452 – HORIZON-JU
-CBE-2022): SustainabLe sUCcinic
acid production using an integRAted
electrochemical bioreactor and renewable
feedstock

Official website of the project:
www.lucra-project.eu

FCC Medio Ambiente participates in this HORIZON
JU CBE (Circular Bio-based Europe Joint
Undertaking) call project that will use municipal
solid waste and wood waste as feedstock for the
large-scale production of bio-based chemicals
products with high yields and high interest for
industrial end-users, from a circular bioeconomy
biorefinery approach. LUCRA proposes innovative
technology for the electrochemical extraction
of succinic acid through the circular use of the
aforementioned resources, which greatly reduces
the dependence on fossil resources by developing

a sustainable route for the production of succinic
acid. The implemented process aims to reduce
the cost of bio-succinic acid and will demonstrate
a 50% reduction of Greenhouse Gases (GHG)
compared to conventional production processes.
In 2023, the kick-off meeting of the project took
place in the city of Ghent (Belgium). In addition, the
first samples of organic waste have been sent to
the different project partners to start the research.

DEEP PURPLE: Domestic Extraction of
Emerging Products with Purple Phototrophic
Bacteria

Official website of the project: www.deep-purple.eu

Project co-funded by the Bio-Based Industries
Joint Undertaking in the European Union’s Horizon
2020 Framework Programme for Research and
Innovation.

The project proposes a synergistic and
comprehensive treatment for the valorisation of
three types of bio-waste: OFMSW, sludges from
wastewater treatment plants (WWTP) and urban
wastewater, by means of a multi-platform photo-
biorefinery based on phototrophic purple bacteria.
This new concept will enable the generation of five
new bioproducts for commercial applications in
the cosmetics, plastics, construction and fertiliser
industries.

Mitigation of environmental
impact

FCC. Annual Report 2023

132

LIFE ABATE (LIFE-2022-SAP-ENV
101113838): Marketable high performance
compact technologies for the abatement
of VOCs in EU waste treatment plants,
decreasing CO2 emissions and energy
consumption

The LIFE ABATE project, partially funded by the
LIFE programme, aims to improve the sustainability
of mechanical biological waste treatment (MBT)
plants by demonstrating the benefits of innovative
technology to reduce emissions of non-methane
volatile organic compounds (NMVOCs) and CO2.
This process includes a VOC concentration stage
using the concentrator followed by biological
or thermal degradation, reducing emissions of
NMVOCs and odours, lowering energy consumption
and using the emitted CO2 to promote the growth
of crops in greenhouse agriculture. The ultimate

goal of the project is to reduce NMVOC and CO2
emissions, improving human and ecosystem health
and well-being, with a lower energy consumption
in comparison to current systems. The solution
will be validated on an industrial scale at Ecoparc 3
Barcelona (Spain) and replicated at the Las
Dehesas Biomethanisation plant in Madrid (Spain).
In 2023, the partners visited these facilities to
determine the optimal location for the prototypes.

133

Information and
communication
technologies

VISION

Within the framework of providing services to
cities, it is essential to consolidate Information
and Communication Technology (ICT) tools
or technological systems that allow for the
identification of the main challenges and that
support the provision of effective, efficient,
sustainable and integrated services.

In the city services management sphere, there is
an increasing demand for integrated and accurate
information that guarantees the provision of the
necessary work with the quality demanded by
public administration and citizens.

FCC Medio Ambiente, through its ICT department,
is developing ‘VISION - Intelligent platform for the
provision of citizen services’, which enables it to
meet the objectives set by clients and respond
to current and future requirements regarding the
provision of services. This platform has been a
driving force for innovation since the beginning of
its development in 2008, applying best practices
in IT developments, integrated communications
systems, geographic information management,
Internet of Things, etc.

2023 saw the completion of a major technological
migration process necessary to respond to the
large number of users and clients served by
VISION.

The resulting technical solution is a platform that
integrates a web portal, communication services
with third-party applications (communication
APIs), mobility platform, geographic services, IoT,
connection with advanced third-party services, also
prepared for the new challenges posed by the use
of artificial intelligence in the systems. Boarded
on containers and hosted on AWS (Amazon
Web Services), it is a modular and scalable
infrastructure that adapts to specific needs and
it constitutes the basis for guaranteeing the sure
growth of business demands. This technological
environment meets the requirements of high
availability (24/7), security and scalability required
by the ISO-27001 and National Security Scheme
certifications in which the system is certified.

In terms of software development, continuous
integration and delivery methodologies (CICD)
are used to provide a swift response to new
requirements or the evolution of current ones.
Within this methodology, quality control systems
are integrated through the programming and
execution of validation tests that globally assess
the impact of changes introduced to guarantee
their effectiveness, as well as security and
regulatory compliance.

Sustainable development

FCC. Annual Report 2023

134

Project for the sealing of metallic mining
waste landfills

In 2023 FCC Ámbito completed the ‘EFFECTIVE
SEALING SOLUTION FOR METALLIC MINING
WASTE LANDFILLS FOR THE CONTROL OF
POTENTIALLY TOXIC ELEMENTS’ Research and
Development project. This is a novel process
involving a multi-layer physical barrier based on
technology proven at small scale. The feasibility
of using materials from waste in the making of
granular layers was investigated, thus promoting
the circular economy. The project received funding
from the CDTI and counted with the collaboration
of the Polytechnic University of Cartagena. The
work was carried out in the Region of Murcia, and
it hopes that the positive results will contribute to
improving the environmental quality of this and
other regions in Spain.

Complast Project

Bicisendas (Cycle Lanes) Project

In 2023 FCC Ámbito collaborated in the CIEN
‘COMPLAST’ project, led by ANTEX, a specialist
in synthetic textiles. The project, which will last
42 months, seeks to obtain new thermoplastic
composites with improved properties for
high-value applications in the aeronautical, railway
and automotive industries, which can be recycled
and/or incorporate recycled materials. The
synthesis and generation of new textile products
and thermoplastic composites and their use in
parts for different transport industries will be
researched, as well as manufacturing processes
for the materials and parts to be developed. FCC
Ámbito is focusing on finding high-value uses for
recycled glass and carbon fibres, collaborating with
universities and technology centres such as AITEX,
GAIKER and the University of Girona (Spain).

The CIEN ‘Bicisendas’ project, led by
FCC Construcción and in which FCC Ámbito
participates, was completed in 2023. The main
objective was to develop a new generation
of sustainable, energy self-sufficient, smart,
decontaminating, integrated and safe bicycle lanes,
made of modular and sustainable materials. The
project focused on four areas: environment, energy,
safety and ICTs. Universities and technology
centres such as CSIC, University of Zaragoza
(Spain), UPC, AITIIP, CIMNE, LEITAT and Lurederra
collaborated in the project. FCC Ámbito focused
on the recovery of waste, selecting materials with
high silicon and aluminium content to be used
as raw materials in an AAM agglomerant and the
study of the suitability of various wastes for the
adsorption of hydrocarbons and the immobilisation
of microorganisms.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

135

End-to-end Water Management Cycle

1. Sector analysis _ 137

2. Activity in the Water Area _ 146

3. Highlights End-to-end Water Management Cycle 2023 _ 149

4. Service excellence _ 150

5. Innovation and technology _ 172

6. People and culture _ 182

7. Corporate Communication and Sustainability _ 190

8. Regulatory compliance _ 202

9. Digitalisation and cybersecurity _ 205

Aqualia is an international water services
operator that offers efficient technical solutions,
tailored to the supply, management, sanitation
and treatment needs of each community.
The company provides a service focused
on the well-being of people and
environmental protection

Aqualia currently provides service to 45.2 million
users and is present in 18 countries: Algeria,
Saudia Arabia, Colombia, Chile, Peru, Egypt, UAE,
Spain, USA, France, Italy, Mexico, Oman, Portugal,
Qatar, Czech Republic, Romania and Georgia.

Aqualia's primary activity is the management
of integrated water services in municipalities in
countries through long-term concession models
or the ownership of proprietary assets. Aqualia
operates municipal water concessions in Spain,
Portugal, Italy, France and Colombia, as well as
asset ownership in Spain. the Czech Republic,
Georgia and Colombia.

End-to-end Water Management Cycle

Aqualia provides technical solutions and provides
quality services in all phases of the end-to-end
water cycle to improve the well-being of the
people and the communities where it operates,
preserving water resources and the environment
and improving management efficiency, while using
the United Nations Sustainable Development Goals
(SDG) as a benchmark, all following the regulations
in force in each geographical area.

The rapid urbanisation process and the need
to improve the population’s living conditions,
optimising a scarce resource, leads governments,
regions and industrial corporations to search for
specialised operators who can help them provide
effective solutions to the water supply, sanitation
and treatment problems.

Addressing the water challenge is Aqualia’s
greatest challenge due to increasingly hotter
periods with less –and irregular– rainfall in Europe.
The need to move towards a new paradigm that is
more aware and sustainable requires innovation to
overcome the challenges facing the sector.

Aqualia is a leading international operator, focusing
its management on business models based on
public-private partnerships, in specific geographic
areas, with a growth objective that contains
profitability criteria and integrates all the abilities of
the value chain in the water cycle: from the design
of facilities to the management of large investment
projects in water systems.

A2_
Sustainability
Report

FCC. Annual Report 2023

136

Aqualia Team.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial Statements137

(Cádiz). We have submitted 13 proposals in
different geographical areas of the country to the
second tender, which is expected to be resolved
during the first half of 2024.

Regarding the changing electricity costs, Aqualia
has maintained a diversification policy for its
suppliers by entering into two PPAs (Power
Purchase Agreements) and closing prices in the
fixed and futures markets for a high percentage
of our CUP supply points. This has enabled us
to depend only 17.7% on the free market (OMIE),
thus being able to maintain a very low average
cost during the year of €87/MWh. Furthermore,
the reagents necessary for water treatment have
recorded a cost increase of 9.4% and material
purchase and outsourced work costs rose 18%
compared to 2022. On the other hand, average
labour costs in Spain in 2023 rose by 5.7%, the
largest increase in the last 20 years.

1. Sector analysis

1.1.
End-to-end Water
Management Cycle:
Spain

In 2023, the effects of the COVID-19 pandemic
on water consumption have been overcome.
Unfortunately, a new resource availability crisis has
emerged due to prolonged drought in vast areas of
Spain. Recovery of economic activity, particularly
in the services sector and tourism, has also been
affected by the invasion of Ukraine, especially
caused by the exorbitant increase in material costs
that have not been offset by a reduction in energy
costs, leading to a Consumer Price Index (CPI) that
are remained high although moderate compared to
2022, ending the year with a year-on-year increase
of 3.1% and an underlying CPI of 3.8%.

As for the drought, accumulated water reserves
started the year at 47% of the available volume
of reservoir water, reaching August at 39% and
with a slight recover during the last quarter of
the year. Overall, reserve values have remained
around 20 points below the average of the last
10 years. Inland basins in Catalonia, Andalusia and
Murcia maintain reserve values under 20%. Rules
to restrict consumption have been adopted in
these territories such as lowering supply pressure,

cutting supply at night and severe restrictions
on non-priority consumption (swimming pools,
irrigation, hosing, beaches). Volumes billed in the
second half of the year have been affected in these
areas; the situation remains the same at the start
of 2024.

The Government of Spain and some autonomous
regions have approved emergency plans, especially
for the construction of new infrastructure,
emergency construction work on new deep
catchments, extending desalination plants and
improving the use of surface water. New actions
in Barcelona, Almería and Málaga in desalination
stand out, as well as reuse in Andalusia and
Alicante, valued overall at 1.4 billion euros and set
to increase in 2024 and beyond. Furthermore, the
Government of Spain approved the third water
planning cycle in all national basins for the period
ending 2027, with special emphasis on maintaining
ecological flows and quality standards set in
European Directives, with a joint budget for the
actions necessary of 22.8 billion euros.

The Government of Spain approved the PERTE
(Strategic Projects for Economic Recovery and
Transformation) project for the Digitalisation of
the Urban Water Cycle with a budget of 1.6 billion
euros from the European Reconstruction and
Development Mechanism. Two tenders were called
during the year each with a subsidy of 200 million
euros. In the first, Aqualia was awarded to the
project submitted for the Campo de Gibraltar

3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023End-to-end Water Management Cycle | Sector analysis | Page 1 of 91_Letter from the Chairwoman and CEO2_Ethical governance at the highest levelEnd-to-end Water Management Cycle | Sector analysis | Page 2 of 9

138

Regarding the sale of water in bulk, the volumes
supplied rose by 6.6% in 2023 compared to 2022.
However, this type of supply has little weight
for Aqualia. Growth of the aforementioned high
pressure supply rates have benefited from the
prolonged drought in Spain.

Great efforts were made to achieve rate increases
and obtain subsidies in order to maintain the
profitability levels of previous years despite the
sharp rise in costs as mentioned above and
despite the local elections held in 2023, which is
traditionally associated with difficulties associated
with rate reviews.

built for the company AITASA (Aguas Industriales
de Tarragona) and inaugurated by the President of
the Regional Government, is the largest facility of
this kind in Spain.

Highlights in the municipal concessions market
include new contract awards or the renewal or
extension of contracts already operated by Aqualia.
The main contracts were Guía de Isora (Tenerife),
Fuente del Maestre (Badajoz), Piloña (Asturias),
Mancomunidad de Servicios de la Manchuela,
Manserman (Cuenca), La Roda (Albacete), Casas
Ibáñez (Albacete), Hellín (Albacete), Ibiza, Sant
Andreu de la Barca (Barcelona), Linares (Jaén),
Puerto de la Cruz (Tenerife) and Martos (Jaén).

In commercial terms, 2023 was a year for
consolidating Aqualia’s presence in the industrial
water sector. The Polo Químico IWTP in Tarragona,

Notable O&M (Operation and Maintenance)
contracts include operation work for the Western

Coastal Area of Asturias Supply System, the
Operation and maintenance service on the
municipal sewerage network of Madrid (Canal
de Isabel II) for Lots 5 Viveros Sub-basin and 6
La Gavia, Sur and Sur Oriental Sub-basins; the
Plaza, la Muela and Épila WWTPs in Caspe, Maella,
Calaceite and Mazaleón (Zaragoza); improves to
sanitation networks managed by CYII for Lot 1
(Madrid); Technical-sporting services at the indoor
pools in Travesas, Lavadores, Teis and Valadares
de Vigo (Pontevedra); Maintenance services at
the water supply and sanitation facilities of the
Mancomunidad de Mairaga (Navarra); WWTP
maintenance in the area of Tudela (Navarra) and
cleaning and inspection of EMACSA sewerage
networks (Córdoba).

A highly variable conduct was observed in relation
to rate billing to customers —citizens and the
industrial sector— in 2023. During the first half of
the year, there was a 2.3% increase in volumes
billed to low pressure customers, recovering
pre-pandemic figures. Due to the effect of
restrictions on consumption caused by the intense
drought, especially in Andalusia and Catalonia,
average customer consumption fell by -2.6% in the
third quarter. The yearly average value eventually
ended with a slight increase of 0.2% compared to
2022. During 2023, the prohibition on cutting off
the supply of water to vulnerable customers who
had failed to pay their bills was maintained, without
this having any material impact on Aqualia’s
capacity to generate revenue.

Customer behaviour —citizens and industrial
sector— compared to water rate billing was
variable in 2023. The first quarter saw a 2.3%
rise in the volume of water billed to low pressure
customers, back to the same levels as before
the pandemic. Due to the effect of restrictions
on average consumption caused by the intense
drought, average customer consumption fell by
-2.6% in the third quarter, especially in Andalusia
and Catalonia. The yearly average value ended with
a slight increase of 0.2% compared to 2022. During
2023, the prohibition on cutting off the supply of
water to vulnerable customers who had failed to
pay their bills was maintained, with no significant
impact on Aqualia’s capacity to generate revenue.

AITASA Industrial Wastewater Treatment Plant in Tarragona (Spain).

Furthermore, the main O&M contracts extended or
renewed were for the maintenance of wastewater
treatment stations in Castilla-La Mancha,
zone 1 (Toledo); Maintenance service for the
Levinco PWTP in Mieres (Asturias); Operation
services for the Picadas-Almoguera (Toledo)
and Mancomunidad El Girasol (Cuenca) supply
systems; Maintenance and fault management
service of secondary supply networks in the
municipalities of Zone A of the Bilbao Bizkaia
Water Consortium (Vizcaya); Operation and
maintenance services for the peripheral sanitation
networks managed by Canal de Isabel II for Lots 3
Guadarrama, 7 Jarama, 4 Culebro A, 9 Torrelaguna
and 11 Santillana; Maintenance service for the
Toledo and Santa María de Benquerencia (Toledo)

WWTPs; Maintenance service for the sewerage
network of the city of Zaragoza and EMASESA
(Seville); and Maintenance of the Chiclana de la
Frontera y La Barrosa (Cádiz) WWTP.

In the area of EPC (Engineering, Procurement and
Construction), awards for expansion work at the
San Roque (Cádiz) WWTP; expansion work at the
Fuerteventura, Fonsalía and Granadilla de Abona
(Tenerife) SDFs; and the IWTP for Fortune Pig in
Mollerusa (Lérida). During the year, construction
work was completed at the composting plant
in Seville (Ranilla WWTP), to extend the IWTP in
Melilla, and construction is nearing completion
on the new PWTP in Vigo, Mar de Alborán SDF
(Almería) and the Galindo WWTP (Bilbao).

Toledo Technology Centre (Spain).

139

In 2023, Aqualia obtained new contracts in Spain
and has renewed services already in operation
for a total of 318 contracts. They account for
an annual turnover of 241 million euros and a
contracted portfolio of 720 million euros. This
represents a 94% renewal of contracts maturing
in the year, thus accrediting the trust and fidelity
amount Aqualia clients.

In the institutional and legislative field, local,
regional and general elections were held in
May and July 2023. Many local and regional
governments have changed and there has been
a long delay in establishing the new Central
Government, leading to many ongoing tender
processes being frozen as well as the boost of the
EU Reconstruction Plan.

The Water Urban Cycle Board, on which the
MITERD (Ministry for the Ecological Transition and
Demographic Challenge), business associations,
trade unions and users are represented, has
remained active during 2023 as the starting point
for the future Spanish Observatory of Urban
Water envisaged in the PERTE. The Government
approved, in early 2023, the transposition of the
new Directive on the Quality of Water intended for
human consumption. It also amended the Revised
Text of the Water Act and the Public Hydraulic
Domain Regulations. Finally, the Water Acts of
Extremadura, Aragón, Castilla-La Mancha and
Galicia were reviewed, with a strong commitment
to regulating the urban water cycle.

The company's permanent policy is the search for
efficiency in operational management, with the
effort made in 2023 to reduce costs, particularly
in reducing consumption (energy, materials, and

water purchases) has been noteworthy, an action
that has allowed us to improve the efficiency ratios,
despite the above-mentioned price increases.
Progress has been made in the creation of
11 regional logistics centres to enhance synergies
in purchasing capacity and to ensure warehouses
provided by suppliers.

During the year, there has been a greater focus on
reducing costs linked to customer management
through policies to prosecute fraud in consumption
measurements, the promotion of electronic billing,
the increase in direct debiting of bills and control of
bank fees, the reduction of on-site assistance and
moving this to other channels (telephone, social
networks and online).

In digitalisation, the technology centres of
Dénia (Alicante), Oviedo and Toledo –where the
comprehensive digital management tool for
Aqualia Live water services is being developed–
have started operations, which allows for the
integrated management of the water networks,
incidents, work orders, asset management and
meters.

Aqualia has promoted actions in Spain as a
socially committed company, renewing the
agreements in place with UNHCR, Caritas and the
environment through several initiatives that seek
to reduce greenhouse gas emissions, prioritising
green energies. Additionally, Aqualia, as a founding
partner of the StepbyWater Alliance, is maintaining
the momentum for the development of its founding
goals, under Aqualia's CEO.

1.2.
End-to-end Water
Management Cycle:
International

Internationally, Aqualia concentrated its 2023
activity mainly in Europe, the Middle East and
North Africa (MENA) and Latin America (LATAM).

Europe

In 2023, evolution in Europe was characterised by
the following relevant events:

Moderate reduction in consumption caused
by: a) the effects of the 2020 health crisis, the
consequences of which still remain in some
regions, b) public awareness on saving water
and caring for the planet, and c) sensitivity of
demand in the face of rate increases suffered
due to the rise in operating costs. In this sense,
the 3.4% reduction in consumption in the Czech
Republic compared to the previous year and 2%
in Italy are worthy of note.

Increase in water and sewerage rates. Due to
inflation caused by the global energy crisis as a
result of the Ukraine war, water service operating
costs have suffered major increases which,
thanks to the resilience of water contracts
backed by mature regulatory systems, have
led to parallel rate increases. Thus, the Czech
Republic increased its rates by 24.3% and France
by 6.7%.

Member States have adopted supply policies
in light of water scarcity based on the search
for new water resources in desalination and
reuse and greater control of groundwater and
surface water, as well as demand policies to
reduce leaks, sectorisation and digitalisation by
allocating European funds.

Sustainability plans for reducing carbon footprint
and the circular economy to use sector waste
for new usable resources (reused water, biogas,
biofertilisers, renewable energies) promoted by
the European Union, and improved distributed
water and discharged water quality, have served
as a common thread for the development of
new regulations and promoting innovation in
treatment technologies.

Annual inflation in the Czech Republic grew by
double figures, subsequently transferred to a rise in
operating costs which, by applying the regulatory
system, ends up impacting new supply and
sanitation rates. The rise in prices has not been
a barrier for investments in improving networks
in order to maintain high efficiency levels in
infrastructures.

The strength of the Czech koruna (annual average
24 CZK/€) has had a favourable impact on the
company’s consolidated financial statements
expressed in its operating currency (euro).

In 2023, Czech subsidiary SmVaK designed an
ambitious Sustainability Plan in line with Aqualia’s
Sustainability Plan. It established new investments
designed to improve energy efficiency in existing
infrastructures and reduce the system’s carbon
footprint.

140

Commercial activity in the country has been
intense, especially towards the end of the year,
with water tender processes in major cities of
Bohemia with existing private operators such as
Prîbram and Pîsek despite a trend of changing the
management model to direct management. In the
geographic area covered —Silesia and Moravia—,
Aqualia, via its Czech subsidiary, has been awarded
tenders in Opava, Třinec, Žabeň, Doubrava,
Háj ve Slezsku and Těrlicko.

France is still the European country with the most
business opportunities for organic growth despite
having the biggest world competitors in the sector.
Public tenders for managing supply, sanitation or

the end-to-end water cycle proliferate with a French
management model with special characteristics
(DSP, Délégation des Services Publiques) with low
investment needs, contract terms of between
6 and 12 years and joint management with
municipalities. Although competition is deeply
rooted in the territory and margins are narrowing,
Aqualia has increased the population served in
the country to 920,000 people. Contracts in Pays
de Dreux (first sanitation and then distribution)
and the renewal of Andresy are the more
relevant milestones in 2023. The Brittany-based
management unit continues to expand with new
contracts awarded in Iffendic, Lamballe, Theil de
Bretagne and Dinan.

SEFO facilities in Andresy (France).

141

In addition to the classic water management
model, the shortage is the driving force behind
new opportunities. The French Ministry for the
Ecological Transition took a major step forward
in the road to water security by publishing key
legislation on reuse and reinforcing support for
industrial efficiency projects. These measures are
the most tangible steps to date towards the goal of
increasing reuse at national level by 10% for 2030,
set at the beginning of the year in the national
Water Plan, compared to the current level of 1%

All this along with constant interest by French
authorities in improving supplied water quality
by applying membrane technologies will
lead to new public tender concessions with
investments in improving and expanding treatment
infrastructures, such as the case of management
in the Paris metropolitan area.

In Italy, the concession managed by Aqualia’s
local subsidiary, Acque di Caltanissetta, has
satisfactorily completed its 15.5 million euro
project as part of the REACT-EU programme

for financing Recovery and Resilience Plans.
The project consisted of installing new remote
reading systems for 90,000 users, automation
and remote control of installations and
improving networks in the Sicilian province.

The dominant management model in the Italian
market is multi-utility via joint ventures with joint
public-private ownership, as proven by Italian
gas company Italgas recently acquiring shares
managed in the country by Veolia.

Acque di Caltanissetta was also granted funding
from the Sicilian region for two new projects for the
Niscemi water network and sanitation in Manfria
for a total of 8.1 million euros. The Ministry for
the Environment and Energy Security has also
awarded funding for another three projects to
improve sanitation and treatment in the towns of
Delia, Marianopoli and Gel-Manfria for an overall
total of 8.3 million euros.

Nevertheless, the most relevant milestone of the
year was the resolution by the Provincial Court
of Appeal of Caltanissetta (Corte di Appello di
Caltanissetta) in favour of the company, with
10.8 million euros awarded for excess costs
incurred at the start of the concession. It has been
compensated as a rate deficit with approval from
the competent authority and the Italian regulator.

In Portugal, problems caused by the drought are
significantly conditioning water in the country. On
one hand, with special policies to protect the use
of water resources by increasing underground
water consumption monitoring and public tender
processes to promote distribution network
efficiency as part of the digital transition in the
sector. On the other, policies to increase supply
have been adopted by announcing the construction
of new desalination and reuse infrastructures.

The Strategic Plan for Water Supply and Handling
Wastewater and Rainwater (PENSAARP 2030)
aims to boost leak reduction activity. The plan
envisages that any improvement to the network
should introduce smart networks in order to meet
the target of 20% (10 percentage points below the
current level) of water not billed for 2030, set by
sector regulator ERSAR.

In terms of desalination, seawater desalination
projects planned for the tourist area of the Algarve,
industrial area of Sines and agricultural areas in
Southern Portugal are worthy of mention.

A new stage for the industrial sector is also
opening, gaining awareness of the water situation
and actively seeking more efficient solutions
for consumption and liquid effluent treatment.
Expectations generated by the “green energy
corridor” signed by Spain, Portugal and France
open the doors to the proliferation of emerging
sectors, such as green hydrogen production,
which require intensive use of water technologies
to obtain quality water and then hydrogen by
electrolysis.

Inflation has been contained in operating costs
mainly thanks to the standardisation of electricity
costs and their coverage, ensured by the revision
formulas set out in concession contracts which,
following negotiations with the granting authorities,
have generally been transferred to rates.

With things gradually returning to normal, as the
COVID-19 response restrictions were removed,
water consumption fell by an average of 1.4% in
the areas where Aqualia operates in the rest of the
European continent, mainly due to lower demand
from residential customers. However, the growth of
the perimeter, tariff management and the increase
in consumption by non-residential customers
caused Aqualia's turnover in Europe to increase
overall in 2023.

The price increase in the energy markets also
caused a large upward move in prices in the
European countries where Aqualia operates.
However, the strength of the regulated systems
and, in general, the inclusion of fixed price clauses
in contracts, future contracts and participation
in PPAs (Power Purchase Agreements) that have
characterised the company's management in
previous years, allowed Aqualia to remain totally
unaffected by the sharp increase in energy costs.

In France, Aqualia continued to consolidate its
position as the fourth largest water operator in
the country, adding new contracts to its portfolio
of projects under management, including its
first successes outside the Paris region of lle de
France. Specifically, the company was awarded
the contract to manage drinking water for the
next 10 years in the Foret du Theil area, in the
department of Ille-et-Vilaine, and the contract to
manage drinking water for nine years in Kergoff,
both in Brittany. The subsidiary SEFO was also
awarded the water management contract for
the municipalities of Rambouillet, Bonnelles and
Bullion, and the sanitation management contract
for the municipalities of Bois d'Arcy, Bievres,
Jouy-en-Josas and La Celle Saint Cloud, in the

Versailles area. The company was also awarded
a contract for the maintenance of public facilities
in Enghien-les-Bains, also in lle de France. At the
beginning of 2023, Aqualia will serve 91 French
municipalities, having increased the population
served in France to 424,000 inhabitants,
representing 200% growth since entering the
country in 2019.

In the Czech Republic, the rate framework for
water and water supply approved in 2021 by the
Ministry of Finance was already fully implemented
in 2022, and strengthens the active infrastructure
management model to ensure its technical and
economic sustainability in the short and long term.
In this context, Aqualia group companies in the
Czech Republic have continued to invest in network
improvements and the digital transformation of the
service, to contribute towards making increasingly
efficient use of the resources employed. Aqualia
was also awarded new contracts in the country,
including for the operation of sewerage networks in
Krmelín, Albrechtice and Rychvald.

in Italy, the concession managed by Aqualia's local
subsidiary, Acque di Caltanissetta, was selected
by the Italian government to receive European
funds under the REACT-EU funding programme
for Recovery and Resilience Plans. Specifically,
Caltanissetta obtained about 14 million euros for
the installation of new remote reading systems for
90,000 users, the automation and remote control
of installations, and the improvement of networks
in the Sicilian province.

142

In Portugal, the problems caused by prolonged
droughts have aroused the interest of the
public authorities in assessing the feasibility
of building desalination plants for the first time
in mainland Portugal. Public investments have
also been committed to combat drought in the
Algarve, Madeira and Alentejo, and other public
programmes are expected to include investments
for wastewater reuse projects. Aqualia, along with
other private operators, is trying to maintain active
communication so that part of these investments
can be channelled through the robust Portuguese
concession framework with equal opportunities
for public and private operators. Another of the
Portuguese government's lines of action focuses

on public aid for decarbonisation and renewables,
including green hydrogen. Consequently, a
consortium led by Aqualia and FCC Construcción
was proposed as the successful bidder for the
installation of a green hydrogen production plant
in Setúbal, including water supply and treatment
facilities, a pioneering project in this field in
Portugal.

In Georgia, in February 2022, the acquisition of
Georgian Global Utilities (GGU), which provides
end-to-end water cycle services in the country's
capital, Tbilisi, and in two other nearby towns,
Mtskheta and Rustavi, was completed. It serves a
total population of 1.4 million people.

GWP opens its first multifunctional operations centre to improve water service in Tbilisi (Georgia).

During 2023, progress has been made in the
following areas:

Reorganisation of the company to increase
operating efficiency in all processes, especially
regarding fault repairs and leaks in the drinking
water supply network as well as reducing energy
consumption.

Work on the future rate structure with
consumption blocks and fixed fees together with
the regulator GNERC (Georgian National Energy
and Water Supply Regulatory Commission).

Increased public awareness on the scarcity and
value of water with communication campaigns
and public events.

Reorganisation of the company regarding its
investment execution capacity to prepare the
organisation to execute investments planned
and agreed with the regulator at a much higher
level than before.

In late December 2023, the regulator GNERC
published new water rates for the 2024-2026
period, previously agreed with GGU, which will
enable greater investment in improving water cycle
infrastructure.

Drafting of the End-to-end water cycle Master
Plan for Tbilisi, Mtskheta and Rustavi. Main
technical document setting out the priorities
and timeframe for investments and the general
status of all service installations.

143

MENA

In Algeria, the two desalination plants,
Mostaganem and Cap Djinet, have continued to
operate at full capacity and without significant
incidents, providing a critical service to the
population in the country's largest metropolitan
areas, Oran and Algiers.

Administrative difficulties were experienced
throughout 2023 from the cooling relations
between Algeria and Spain caused by the Spanish
government changing its position on the Sahara
conflict.

In Egypt, Aqualia continued to satisfactorily operate
the Abu Rawash wastewater treatment plant, with
a treatment capacity of 1,600,000 m3/day, which
serves the western area of Cairo.

As for the operation of the 250,000 m3/day New
Cairo wastewater treatment plant, work continued
at full capacity and to the client’s satisfaction
throughout the year.

The Alamein desalination plant, with a capacity
of 150,000 m3/day, offers an unrivalled reference
for new projects set out in the desalination plan
established by the Egyptian government with a
view to reducing water stress in the country's
Mediterranean and Red Sea regions. A 5-year
extension to the operation and maintenance
contract was signed in 2022 and the plant has
operated without incident in 2023.

In 2023, new salination and treatment tenders
processes were conducted in Egypt in PPP
(Public-Private Partnerships) and DBO (Design-
Build-Operate) formats. The results have not
been published on the date of the next Report but
Aqualia expects to be one of the winning bidder
companies.

Abu Rawash Wastewater Treatment Plant (Egypt).

In Saudi Arabia, Aqualia completed the last work
to extend water service infrastructures for lines 5,
6 and 7 of the Riyadh underground in 2023.

Additionally, the desalination plants operated by the
Haaisco subsidiary —Jeddah International Airport
desalination plant, KAUST University desalination
plant and the Petrorabigh desalination plant—, all
operated at full capacity. The Jizan desalination
plant, also operated by Haaisco, was finally fully
commissioned in late 2023.

In June 2023, Haaisco signed a new operation and
maintenance contract for three 50,000 m3/day
floating desalination plants, each for Saudi state
shipping company Bahri. One of the three was
already operating at the end of the year, awaiting
the incorporation of the remaining two. These
mobile plants will initially be located in Yanbu
port on the Red Sea but may be moved along
the country’s coast where required for periods of
several months.

Aqualia leads consortia that won two of the six
regional delegated water service management
contracts for the National Water Company in 2022:
North Cluster and South Cluster contracts. The
other four contracts were awarded to consortia led
by Saur, Veolia and Suez.

Since the award in 2022, Aqualia leads the North
Cluster and South Cluster consortia, managing
two of the six regional water service contracts for
the National Water Company. The remaining four
contracts were awarded to consortia led by Saur,
Veolia and Suez.

Each of these two contracts, North Cluster and
South Cluster, have continued to operate to the
client’s satisfaction in 2023 and each have a
large team of professionals who manage and
transform the client’s existing water management
organisation in the provinces of each Cluster. They
also undertake an ambitious programme for the
modernisation and optimisation of the end-to-end
water cycle services, aiming to prepare them for
the privatisation phase.

The South Cluster includes the provinces of Jizan,
Al Baha, Najran and Asir, and serves a population
of 5.5 million. Work began on 1 June 2022. The
North Cluster includes the provinces of Qassim,
Hail, Al Jouf and Northern Border, and serves a
population of 2.5 million. Work began on 1 January
2023. Work has been satisfactory throughout the
year in both the north and south.

In terms of new projects in Arabia, in 2023 offers
have been submitted for two major projects
of the "Long Term Operation and Maintenance"
programme with investment to renew and
extend wastewater treatment plants and 15-year
operation; both are pending award.

In the United Arab Emirates, Aqualia MACE
has continued to provide the operation and
maintenance of the collector networks, pumping
stations and wastewater treatment plants in the
geographical areas of Al Ain and Abu Dhabi without
incidents and at full capacity.

Operation also continues for Al Ain Distribution
Company (AADC) for the operation and
maintenance of water distribution infrastructure for
irrigation in agricultural production facilities and for
irrigation of recreational areas.

During 2023 in Oman, Aqualia has continued
with the end-to-end management of the cycle
in the Sohar port area through its subsidiary
Oman Sustainable Services Company incidents.
All infrastructures for seawater desalination,
supply and distribution of drinking and process
water, distribution of cooling water for industries,
collection and treatment of wastewater and
distribution of reused water for irrigation are all
now fully operational.

In Qatar, operation has continued at the
Al Dhakhira wastewater treatment facilities
to the north of the country, with capacity for
55,000 m3/day and operated by Aqualia MACE.
The plant supplies treated water for garden
irrigation to areas near the Al Khor stadium, one
of the main World Cup venues.

Also, within the framework agreements that
Aqualia has signed with Ashghal, the Qatari
Ministry of Public Works, for the execution of
works on sewerage networks and infrastructures,
several internal coating projects for collectors and
network extension continued in 2023.

As part of this activity, a new contract was signed
to remodel the Doha South wastewater treatment
plant.

144

USA

During 2023, Aqualia maintained its commercial
activities in the United States with its active search
for new projects and business opportunities.
Efforts have specifically focused on acquiring a
platform to develop business in the US market.

At 31 December, 97% of the Municipal District
Services (MDS) company was acquired via the
subsidiary FCC Aqualia USA corp. The purpose of
MDS is integral water infrastructure and sanitation
management in the Municipal Utility Districts
(MUD) around the Houston metropolitan area
(Texas). MDS currently serves 360,000 inhabitants
with 136 contracts.

The main growth opportunities for the company
in certain states appear to be water shortages,
obsolete water infrastructure, and the scarce
penetration of private sector operators in the
industry. The increasingly stricter legislation in
relation to controlling and eliminating emerging
pollutants to protect water bodies and surface
water represent a business opportunity to be
explored in the coming years.

LATAM

The deficit of water infrastructure and the search
for efficiency in the existing infrastructure are two
factors that enhance Aqualia's growth possibilities.

In 2023, Aqualia continued to consolidate its
position as a sector leader in Mexico thanks to
a highly diversified asset portfolio, making it a

benchmark in the country. This portfolio includes
water distribution and purification through the
Querétaro and San Luis de Potosí BOT (Build,
Operate and Transfer) contracts, desalination
through the Guaymas BOT contract, wastewater
treatment through the Cuernavaca WWTP
BOT contract and the Integral Management
Improvement project, with a BOT contract
structure, in Los Cabos, Baja California Sur.

Aerial view of the El Salitre Wastewater Treatment Plant (WWTP) in Bogotá (Colombia).

145

With the commissioning of the capital of Guajira
department, Aqualia strengthens its presents in
Colombia where it now supplies 30 municipalities
in eight departments throughout the country, and
provides service to almost 1.2 million inhabitants,
consolidating its position as the second largest
private operator in the country.

Aqualia has also continued to integrate and
improve management of the services acquired
in 2020 in the department of Córdoba (Aguas de
Sinú, Uniaguas and OPSA), the municipality of
Villa del Rosario, as well as new incorporations in
2022 and the services of Flandes, Ruitoque, Aguas
de la Sabana, Aguas de la Península, Aguas de
Albania, Aguas de Aracataca, Aquamag Fundación,
Aquamag Retén and Aguas del Sur del Atlántico.

In Peru, the government is evaluating the efficiency
of its public supply services to allow the entry of
private sector companies wherever management
indicators are lowest. Aqualia is implementing
seven co-financed private initiatives for wastewater
treatment and desalination plants. Four of these
projects are in an advanced structuring phase and
are part of the significant portfolio of short-term
projects for ProInversión.

The experience obtained in the BOT contracts is
providing us with a basis for proposing similar
projects to institutional customers, as the technical
and financial skills employed have placed Aqualia
in a position of leadership.

The Guaymas desalination plant, awarded in
2018 by the CEA (State Water Commission) of
Sonora under a BOT system and whose execution
was delayed slightly due to the pandemic,
began operations in mid-2022 and continues to
operate satisfactorily, actively contributing to the
development of the region and alleviating the
intense drought experienced in the state of Sonora.

In June 2023, phase one of the Integral
Management Improvement (IMI) Project
formally began. This will increase efficiency
levels and improve the drinking water service in
the municipality of Los Cabos by implementing
actions related with sectorisation, user registration,
micrometering, leak detection and control, under a
public-private partnership system.

In Colombia, the final touches continued on the
El Salitre WWTP (Wastewater Treatment Plant)
construction project in Bogotá. The plant is
expected to be finalised in the first half of 2024.

On 1 June 2023, Aqualia began performing the
contract for the management, financing, operation,
refurbishment, construction, design, expansion,
replacement and maintenance of household
public service infrastructure of the aqueduct and
sanitation sewer network in the district of Riohacha
(Guajira). This is the company’s largest operation in
Colombia and will enable it to provide service to a
population of around 310,000 over 30 years.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

146

End-to-end Water Management Cycle | Activity in the Water area | Page 1 of 3

2. Activity in the Water Area

1. USA
Texas

Acquisition of MDS for end-to-end
water cycle management of 140
contracts in 8 counties.

3. Saudi Arabia
Riyadh

6. Czech Republic
Dolní Domoslavice

Services to improve the storm
water network in Al Nesai Street
for Riyadh underground line X for
a period of over 4 and a half
months.

Operation and maintenance of the
sewer system in the town of Dolní
Domaslavice, Frýdek-Místek
district, Moravian-Silesian region,
for 50 years.

Shuqaiq

Operation and maintenance
of three floating reverse osmosis
desalination plants on barges
(50,000 m3/day each;
150,000 m3/day total capacity)
for a 3-year period.

4. Qatar
Services to improve water assets in
southern Qatar.

Services to improve sewer and
sanitation connections.

5. France
Dreux

2. Colombia
Riohacha

Management, financing, operation,
refurbishment, construction,
design, expansion, replacement
and maintenance of household
public service infrastructure of the
aqueduct and sanitation sewer
network in the district of Riohacha
for a period of 30 years.

Public service concession for
collective sanitation in Dreux
(Centre-Loire Valley region) for
a period of 6 years and 3 and
a half months.

Various municipalities

Six awards for work and operation
and maintenance services with
portfolios under 2 million euros.

Santa Cruz de Tenerife

MADRID

Extension work at the Fonsalía
Seawater Desalination Plant for a
period of 9 and a half months.

Work to improve the sanitation
networks managed by Canal de
Isabel II (Lot 1).

7. Spain
ANDALUSIA

San Roque (Cádiz)

Construction of the discharge
grouping for some municipalities in
the Campo de Gibraltar and the
new San Roque WWTP. 3-year
contract with ACUAES.

ARAGÓN

Plaza, La Muela and Épila
(Zaragoza)

Operation, maintenance and
conservation service of the Plaza,
La Muela and Épila WWTP for a
period of 3 years.

Granadilla de Abona (Santa Cruz
de Tenerife)

Extension work at the Granadilla
Seawater Desalination Plant for a
period of 10 months.

Fuerteventura

Work to replace osmosis modules
at the Puerto del Rosario Seawater
Desalination Plant for 1 year.

CATALONIA

CANARY ISLANDS

Mollerussa (Lérida)

Santa María de Guía (Las Palmas
de Gran Canaria)

Concession of the public water
supply and sanitation service of
Santa María de Guía for a period
of 40 years.

Pájara (Las Palmas de Gran
Canaria)

Maintenance service for the supply,
sewer, treatment and desalination
service in Costa Calma, in the
municipal district of Pájara, for a
period of 2 years.

DBO (Design, Building and
Operation) of the Fortune Pig
Industrial Wastewater Treatment
Plant in Mollerussa for a period of
8 years.

EXTREMADURA

Fuente del Maestre (Badajoz)

Concession of the public drinking
water supply, sewerage and
treatment service for a period of
10 years.

Operation and maintenance service
for the sewer network and
complementary services in the
municipality of Madrid; Canal de
Isabel II Metropolitan sewer
network (Lot 5, Viveros sub-basins)
for a period of 4 years.

Operation and maintenance service
for the sewer network and
complementary services in the
municipality of Madrid; Canal de
Isabel II Metropolitan sewer
network (Lot 5, La Gavia, south and
south-east sub-basins) for a period
of 4 years.

Various municipalities

58 work and service and
maintenance awards

With portfolios under 2 million
euros.

1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

End-to-end Water Management Cycle | Activity in the Water area | Page 2 of 3

147

2.1.
Expansions and
extensions to already
managed contracts in
Spain

Martos (Jaén)
Extension of the concession of the water supply
and sanitation service in the municipality of
Martos for a period of 4 years.

Dos Hermanas (Seville)
Extension of the project for the construction of
the Copero environmental complex.

Córdoba
Renewal of the cleaning and inspection
service of sewerage networks, scuppers and
installations of EMACSA for a period of 3 years.

Linares (Jaén)
Extension of the concession for the end-to-end
water cycle service with a joint venture for
another 20 years.

Zaragoza
Extension of the hybrid services contract and
minor conservation and repair work for cleaning
and maintaining the sewerage and urban
drainage systems and network of underground
channels of the city of Zaragoza for another
year.

Piloña (Asturias)
Renewal of the concession for water supply and
sewerage services in Pilona for a period of 15 year.

Ibiza (Balearic Islands)
Extension of the concession for water supply
and sewerage services in Ibiza for another year.

Puerto de la Cruz (Santa Cruz de Tenerife)
Extension of the concession for the water supply
service in Puerto de la Cruz for another year and
a half.

San Miguel de Abona (Santa Cruz de Tenerife)
Extension of the water supply, distribution
network conservation and maintenance and
water deposits service in San Miguel de Abona
“Golf del Sur, S.A.” for another 6 years and
9.5 months.

Valmojado (Toledo) and Mancomunidad
El Girasol (Cuenca)
extension of services for the operation,
conservation and maintenance of supply
systems in Picadas-Almoguera (Toledo) and
Mancomunidad El Girasol and drive systems in
Almoguera-Algodor-Sagra Este (Cuenca) for a
period of another 2 years.

Toledo
Extension of the maintenance, conservation,
operation and recovery service for the
Wastewater Treatment Plants of Toledo and
Santa María de Benquerencia for another year.

Illescas (Toledo)
Extension of the concession for the public
drinking water supply and sewerage service
management and operation for another year.

La Manchuela (Albacete)
Renewal of the concession for public drinking
water supply and sewerage services for
Mancomunidad de Servicios de La Manchuela
(Manserman) for a period of 12 years.

Hellín (Albacete)
Extension of the concession for the sewerage
and wastewater treatment service in Hellín and
district for another 5 years.

Casas-Ibáñez (Albacete)
Extension of the water supply service concession
for another 15 years.

La Roda (Albacete)
Extension of the water supply service concession
for another 5 years.

Lloret de Mar (Girona)
Extension of the supply service in the Serra Brava
residential development for another 11 and a half
years.

Sant Andreu de la Barca (Barcelona)
Extension of the water supply service concession
for another 5 years.

Vigo (Pontevedra)
Renewal of technical-sporting services at the
indoor pools in Travesas, Lavadores, Teis and
Valadares and gyms in Travesas and Berbés for
another 4 years.

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148

Madrid
Extension of the operation and maintenance
services on the sewerage network and
complementary facilities (Lot D, Valdebebas
sub-basins, South and South-East; Jarama and
Colmenar areas) for a period of 8.5 months.

Extension of operation and maintenance
services of the peripheral sanitation networks
managed by Canal de Isabel II (Lot 4, Culebro A)
for another year.

Extension of operation and maintenance
services of the peripheral sanitation networks

managed by CYII (Lot 3, Guadarrama) for another
year.

Extension of operation and maintenance services
of the peripheral sanitation networks managed by
CYII (Lot 9, Torrelaguna) for another year.

Extension of operation and maintenance services
of the peripheral sanitation networks managed by
CYII (Lot 7, Jarama) for another year.

Extension of operation and maintenance services
of the peripheral sanitation networks managed by
CYII (Lot 11, Santillana) for another year.

Melilla
Extension of works and services for the
expansion of the Seawater Desalination Plant
and operation during work execution and
commissioning.

Mancomunidad de Mairaga (Navarra)
Renewal of maintenance, conservation,
operation, cleaning and repair services of water
supply and sanitation installations as well as
meter reading for a period of another 10 years.

Alcoy (Alicante)
Extension of the water supply service
concession for another year.

Villena (Alicante)
Extension of the concession for the public
drinking water supply and sewerage service
management and operation for another year.

Various municipalities in Spain
216 renewals, extensions and expansions. With
portfolios under two million euros.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

149

End-to-end Water Cycle Management | Events in 2023 End-to-end Water Cycle Management

3. Highlights End-to-end Water Management Cycle 2023

January

March

May

July

September

November

February

April

June

August

October

December

_ Aqualia wins a 10-year contract to manage drinking water in the area of Foret du Theil, in the Ille and Vilaine department of Brittany (France)._ Aqualia takes part in the StepbyWater alliance conference ‘Drought in Europe’ supported by the Government of Spain and the Spanish Federation of Municipalities and Provinces (FEMP)._ Aqualia participates in ‘Carrefour des gestions locales de l’eau’, the main water management event in northwest France._ Platja d’Aro Council in Girona (Spain) awards Aqualia management of the water supply for the next 25 years._ Twenty-year extension to the Aqualia contract, via its subsidiary Linaqua, for service in Linares, Jaén, thus consolidating the first contract in Spain obtained in 1972._ Inauguration of the AITASA treatment plant at the largest petrochemical industrial estate in Southern Europe, built by Aqualia, and that will operate for 5 years._ Aqualia and Los Alcázares Council in Murcia (Spain) present the NINFA project, which will monitor and prevent contamination in the waters of the Mar Menor._ Aqualia named Water Company of the Year 2022 at the Global Water Awards 2023._ ‘Ofiso 2023 Award’ granted to Aqualia for the best sustainable loan in 2022 for the corporate green syndicated loan of 1.1 billion euros._ Aqualia officially begins Phase 1 of operations for the Integral Management Improvement (IMI) project in Los Cabos, Baja California Sur (Mexico)._ New contract awarded to Aqualia in France for sanitation and water treatment in 41 municipalities in the Centre-Loire Valley region for six years._ Aqualia wins the contract to operate and maintain three floating desalination plants in Saudi Arabia that will produce 50,000 m3 of desalinated water per day._ Aqualia is awarded the work to extend the Fonsalía desalination plant in Santa Cruz de Tenerife (Canary Islands, Spain)._ Aqualia wins the new contract to supply drinking and sanitation water in Santa María de Guía (Gran Canaria, Spain), for a period of 40 years._ Speech at the 5th Silk Road Forum in Tbilisi (Georgia) with participants from more than 60 countries including political leaders and representatives from international organisations and financial institutions._ Aqualia gains the Diversity Leading Company seal and renews the ‘Equality in Business-DIE’ distinction awarded by the Spanish Ministry of Equality._ Aqualia collaborates in the 35th ANEAS Annual Convention and Expo (National Association of Water and Sanitation Entities) in Mexico._ The consortium, led by Aqualia, that manages water services for the North Cluster in Saudi Arabia formally begins its operation._ Aqualia presents a seminar in Oviedo (Spain) on regeneration and reuse of water as part of the H2020 ULTIMATE project._ The treatment plant in Jerez de la Frontera (Cádiz, Spain), opts for energy sustainability by installing over 1,500 solar panels._ Dual nomination at the Global Water Awards for ‘Water Company of the Year’ and ‘Wastewater Project of the Year’ for the Abu Rawash plant (Egypt)._ AqualiaMACE rewarded by public corporation Al Ain Distribution Company, Abu Dabi (United Arab Emirates) for its commitment to the health and safety of is more than 500 employees._ The ‘Hub Reusa’ project is presents at the El Toyo WWTP in Almería (Spain) as a reference for the agricultural use of regenerated water._ Present at the Quality Water Summit and the 5th Ibero-American Congress of Engineering and Technology (CIBITEC23)._ Aqualia starts to manage supply and sewerage in Riohacha, capital of the department of La Guajira (Colombia)._ Participation in the 25th ANDESCO Congress held in Cartagena de Indias (Colombia)._ Aqualia takes part in the 13th AEDYR International Congress (Spanish Association of Desalination and Reuse) in Granada (Spain)._ #Actúa, the Aqualia 2021 Sustainability Report, finalist at the 6th “Ramón del Corral” Dircom Awards._ Aqualia and NGO Asperga, from Spain, and Rotary E-Club Origen, from Colombia, launch local initiatives thanks to grants from IFM Investors._ Aqualia participates in the Technology Transfer Seminars organised by Aqualia - AdTa (Águas do Tejo Atlântico), which belongs to the state corporation Águas de Portugal._ Caltaqua begins digitalising remote reading by installing 17,000 remotely-controlled meters (Italy)._ MITERD approves the Campo de Gibraltar PERTE in Cádiz (Spain), a project submitted by Aqualia and the public corporation Arcgisa to digitalise the water cycle in eight municipalities._ The Cartagua and Aquamaior services in Portugal are awarded the “Exemplary quality of water for human consumption seal”._ Photobiorefinery inaugurated for the Deep Purple project at the treatment plant in Linares (Jaén, Spain)._ Aqualia celebrates the second edition of the “i4U” Innovation Awards._ Aqualia and FCC Construcción complete the extension of the Glina WWTP (Bucharest, Romania)._ Twelve projects are submitted by Aqualia to the second call of the Water Cycle Digitalisation PERTE._ Aqualia receives the ‘Impact Project Investment of the Year’ award._ Aqualia takes part in the Salón des Maires et des Collectivités Locales in France, backed by the AMF (French Association of Mayors)._ GWP opens its first multifunctional operations centre to improve water service in Tbilisi (Georgia)._ Inauguration of the Centre for Innovation in the End-to-end Water Cycle at the Salamanca WWTP (Spain) to develop bioproduct generation projects._ Aqualia is recognised by the Federation of Business Owners of Cádiz (Spain) for its contribution to the SDG with the “Sosteniblómetro” initiative.End-to-end Water Cycle Management | Service excellence | Page 1 of 22

4. Service excellence

150

4.1.
Customer management

It is essential for Aqualia to expand the company’s
commitment to society, seeking the goal of
excellence in customer service. The company aims
to stand out in the market by developing services
adapted to its users’ needs. In 2023, progress
continued in terms of gearing the strategy towards
end customers, particularly focusing on the quality
of the channels used to interact with our users,
enhancing investment in technology.

Customer service channels

Customer Service Call Centre, virtual office,
mobile app, X (formerly Twitter) and email.

In 2023, the main indicators in customer service
channels aqualia contact are:

The specialist service offered by the telephone
agents, in addition to the proactive nature
and speed with which the customer service is
offered in the form of a remote system using the
Presence (Evolutio) solution, made it possible
for customers to receive assistance with no
downtime via the different customer service and
fault reporting channels, such as:

Customer Service Call Centre. The top remote
channel most used by users; during 2023,
1,024,688 calls were received, a 4% increase
compared to the previous year.

The Customer Service Call Centre has an
“Appointment service” available for customers
to prevent waiting times and overcrowding at
in-person offices, improving not only the over-the-
phone service, but also providing a faster, more
effective and pleasant service.

In 2023, 33,621 appointments were arranged
for in-person meetings at our offices in a more
efficient manner and without delays.

Aqualia contact virtual office. The second
most used channel for our users. In 2023,
145,042 interactions were handled through the
virtual office. In total, 32.30% interactions were
related to amending data, 20.83% electronic
billing and 23.91% bank card payments.

Aqualia contact Customer Service Call Centre in Madrid (Spain).

App for mobile devices. Using the app available
to our customers for smartphones and tablets, in
2023 87,702 interactions were processed, with
70.74% of these regarding payment by bank card
and 16.02% to amend data.

More responsive and capable service:

— Multi-platform customers.

— Use of resources, development of
communication skills by channel.

X (formerly Twitter) @aqualiacontact. Through
the @aqualiacontact account, messages sent by
users are managed and dealt with (918 in 2023).
SMS messages for notifications of bills and
incidents and warnings of failures in networks are
also possible (954,697 SMS messages in 2023).

The efficiency of all customer relationship channels
allows for a very reduced number of claims, 0.69%
in 2023 with a maximum claim response time set
at 11 calendar days. The maximum average meter
installation time (from request) of six calendar
days is also noteworthy.

To meet the high expectations that the customers
have of the service offered by Aqualia, we will
continue making progress to be able to provide a
quality omnichannel experience when they interact
with the company. The following objectives have
been set for this:

A better quality and more pleasant experience
for customers:

— Any operation from any channel.

— Single processes for every channel.

For 2024, projects will begin in order to
incorporate advanced new technologies
to provide a better customer service with
management processes that will stand out for
their agility and efficiency, such as:

— Whatsapp professional.

— Click to call from the website.

— Payments through Bizum.

— Electronic signing of documentation.

Billing and managing collections

The Customer Management department has
kept the same strategic vision in the evolution of
management tools, as well as in advancing new
utilities in the Business Intelligence tool. In 2023,
several improvements were made to this tool,
including information on production pending billing,
and the values of adjusted and total cubic metres;
profitability of replaced meters, adding the type of
customer and the installation dates for replaced
meters; for fraud, the type and final status of the
file have been included.

151

A scorecard is being developed for the meter fleet
based on ranges by age and reading rates, with
information on the number of meters and billing
data, in terms of cubic metres, variable amounts
and average tariffs, to boost knowledge for the
meter replacement optimisation process.

Regarding the billing and debt management
tool for non-tariff items, the functional designs
for the incorporation of the multi-currency
and multi-language requirements have been
established, and the final functional design of
the billing requirements in France has also been
defined. Both developments shall enable the
implementation of all international services.

At December 2023, billing has varied on a constant
basis compared to the previous year, with a rise in
m3 of 2.56%, mainly due to domestic consumption
in Georgia (9.13%) and high pressure water
consumption in the Czech Republic (7.83%) and
Spain (6.61%). This rise means a 5.72% increase
in billing, also taking into account the sharp rise
in rates in the Czech Republic for both supply
and sewerage (24%), high pressure water (14%)
in Colombia and France, and the impact of the
Georgian Lari exchange rate variation.

Regarding the different collection methods,
direct debit accounts for 89% of total collections,
followed by bank transfer (5%), cash collection
(2%), bank counter (2%) and POS (2%).

Turnover variations in 2023 compared to 2022 by country

Spain

Czech Republic

Italy

Portugal

France

Colombia

Georgia

Total

%VAR M3
Billed

%VAR
Amount Billed

%VAR
Average Rate

1.36%

1.91%

-1.85%

0.98%

-0.91%

-0.04%

7.74%

2.56%

2.57%

22.36%

0.56%

5.56%

10.23%

7.45%

12.72%

5.72%

1.19%

20.07%

2.45%

4.53%

11.24%

7.50%

4.61%

3.08%

152

Average collection period and non-payment

Aqualia’s average global collection period recorded
a rise, mainly due to increased activity in the
international area over the last few years, with the
recent incorporations of concessions: in Colombia,
in Magdalena, Flandes and Sabana (late 2022) and
Riohacha (mid-2023); in Saudi Arabia, commission
of the North Cluster (January 2023); and in France,
new concession in Bretagne (January 2023) and
Dreux (October 2023). The trend in recent year
is due to the acquisition of French SPIE Group

companies in 2019, the companies Qatarat and
Haaisco (Saudi Arabia) in 2020, progress in
work on the El Salitre WWTP (Colombia) and the
incorporation of companies in Georgia in 2022.

In Spain, the continuous improvement of
management processes has enabled Aqualia
to achieve an average tariff collection period of
1.89 months, similar to pre-pandemic levels.

Regarding non-tariff concepts, there was an
increase in the average collection period mainly

due to the development of work in La Gomera
(Canary Islands) that began in October 2022, work
on the El Ejido WWTP (Almería) in early 2023 and
the advance of work at the Healsa IWTP in Bodión
(A Coruña).

These changes slightly increase the overall average
collection period in Spain.

In the tariff processes, the structural default has
been improving every year, with Spain improving
most, and has evolved as follows:

Aqualia has continued to promote the use of
electronic invoicing among its customers with
specific campaigns in 2023 to foster the use of
electronic billing and gradually replace as many
paper invoices as possible. This action has allowed
for a 15% increase in the number of bills issued
electronically up to December 2023 compared to
the previous year, reaching a global rate of 24.42%
in Spain and a cumulative global rate of 38.72%,
contributing to preserving the environment, with
1,526,887 customers choosing to receive this type
of bill, and over 10.7 million electronic bills issued
per year.

Average global collection period

Average tariff collection period in Spain

Average collection period in Spain

4.42

3.95

3.78

3.30

3.17

2.89

2.94

2.40

2.10

4.01

3.45

2.82

3.02

3.17

3.20

3.11

2.99

2.45

2.46

1.86

1.85

2.15

1.93

1.92

1.89

4.74

4.14

3.81

3.26

3.16

2.81

2.74

2.34

2.22

2.35

2.19

2.77

2.41

Dec
2011

Dec
2012

Dec
2013

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

Dec
2011

Dec
2012

Dec
2013

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

Dec
2011

Dec
2012

Dec
2013

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

Average international collection period

Average non-tariff collection period in Spain

Structural default in Spain

2.78

2.86

2.84

2.94

3.63

3.14

2.73

3.89

2.84

1.47

6.16

8.17

5.25

5.51

6.57

5.81

0.76%

0.74%

0.72%

0.71%

4.09

4.29

4.53

4.21

3.90

3.78

3.17

3.11

3.69

3.91

0.69%

0.68%

0.67%

0.66%

0.65%

Dec
2011

Dec
2012

Dec
2013

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

Dec
2011

Dec
2012

Dec
2013

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

Dec
2014

Dec
2015

Dec
2016

Dec
2017

Dec
2018

Dec
2019

Dec
2020

Dec
2021

Dec
2022

Dec
2023

153

a parameterisation module with multiple
configuration options associated with the different
levels of the organisation structure.

The solution for implementation includes the
following features:

This solution will allow us to achieve efficiencies
and improves in different aspects of our business,
such as:

New virtual office project

The project includes the construction of a new
website aimed to the end customer. It will replace
the current virtual office in order to improve
service levels, providing new features and ensuring
ease-of-use and agility in the different formalities
available.

It will be rolled out to cover all operations with the
relevant adaptations to the country and legal entity.

It is planned for production in the first half of 2024.

It has a modern, intuitive design for the customer
adapted to the Aqualia brand and optimised for
mobile browsing.

Electronic document signature
project

The solution is integrated with commercial
management systems, allowing for online queries
and interactions.

This solution provides flexibility to changes in
commercial systems and in the organisation
structure, such as incorporating a new operation,
contract, company or country. It includes

The aim of the project is to provide an SaaS
(Software as a Service) platform integrated
with the commercial system and that allows
documents to be signed electronically.

Each day, a large number of files are managed that
require a document to be signed, physically filed
and digitised.

Digitised handwritten signature with stroke
biometrics (collection of pressure, slant and
speed) that can be completed on wacom
devices and tablets.

OTP signature (One-Time Password) to obtain
consent by sending operating codes to mobiles
via SMS.

The documents signed are automatically saved
on a Sharepoint document manager.

Consents are deposited with a notary so that, if
necessary, we can accredit who, when and how
each consent was accepted.

The solution will be integrated with all customer
service channels (in-person office, call centre,
mobile app and virtual office).

Improvements in different processes and task
automation.

Improved customer orientation and service.

Cost reduction, minimising task
completion time and paper usage.

Improved access and storage of documentation.

Ensuring documents are signed, as well as
their validity and security.

Currently in the construction phase, the solution
will be available in product for the first half of 2024.

Genesys Cloud platform implementation
project

The goal is to implement a cloud contact centre
so we can incorporate major improvements in
telephone customer services provided. The main
characteristics of the tool include:

Notifications are sent via the aqualia contact
mobile app and SMS, thus making it easier
to detect problems early and contributing the
increase transparency and easy access to various
types of information.

The following types of alert were rolled-out in
production in 2023:

Unified solution for communications via
telephone and other channels like email or social
media.

High availability and redundancy of the platform,
ensuring 99.99% availability with 24/7 support.

Weekly monitoring and updates to the
Roadmap/Innovation platform including
additional improvements for automatic use.

The solution will be rolled-out in product for
Call Centre agents during the first half of 2024.

Possible leak alert. Based on a series of
criteria and algorithms, the AWA (Aqualia
Water Analytics) app identifies possible
leaks at a given supply point. This triggers an
alert notifying the customer that a possible
consumption anomaly has been detected. Via
the aqualia contact mobile app, customers can
configure the following alerts for a given time
period and specific supply point, thus including
improvements in the effective control of water
use.

Improvements in notifications to
customers with remote meter reading

Unexpected consumption alert. This notification
is generated when consumption is detected
based on criteria defined by the customer.

Improvements related with notifications that can
be received by customers with remote meter
reading have been included.

No consumption in 24 hours alert. Similar to
the previous alert, this notification is generated
when no type of consumption is detected in a
24-hour period.

Consumption over fixed limit alert. On the mobile
app, the customer can configure a warning alert
when their daily consumption exceeds the limit
they have set.

Improvements in continue billing:
anomaly automation

An important package of updates has been
included in the commercial management system
to fully automate the generation of reading and
billing anomalies.

As a result of checks prior to the closing of periodic
billing, anomalies are generated to identify possible
anomalous situations, which are used to control
and monitor the billing process.

Prior to rolling out these features, checks were
run manually using downloads generated by
the system itself. With automation in anomaly
generation, we have achieved significant time
savings on tasks to be carried out by the user, as
well as a change in work system to shorten times
and reduce the risk of possible errors.

The system also provides the necessary
traceability for validations prior to closing billing
and control reports for verifications, as well as
expanding data and options for resolving an
anomaly.

154

Meter digitalisation in Güímar, Tenerife (Spain).

Improvements in the meter reading
mobility application

Data protection

In the current AQ360 mobility app, the readings
module includes the integration with the radio
frequency reading operation for certain meter
models. With this new operation, radio readings
are now from current Android devices for both
individual and side-by-side meters and the reading
process status can be viewed in these cases.

These improvements have enabled us to replace
the old TPLs still in use for radio readings and
collect readings with a single app via smartphone.

Following the entry into force of Regulation
EU 2016/679, GDPR, on 25 May 2018, and the
entry into force of Organic Law 3/2018, on
Personal Data Protection and the Guarantee
of Digital Rights (LOPDGDD) on 5 December
2018, Aqualia embarked on a regulatory
adaptation process in relation to data protection.
Compliance and adaptation to legislation in force
is continuously and permanently reviewed at all
entities as it applies to all areas affected in the
following aspects:

Employees.

Customers.

Suppliers.

FCC Group’s contractual relations.

Public administration contractual relations.

Documentation and internal management.

Information Technology and Information
Security.

Technical and organisational measures.

The organisation’s data protection risks are
shown on the risk heat maps. A heat map is a tool
presented as a two-dimensional matrix showing
the likelihood of a risk occurring while the impact
of that risk is plotted on the Y-axis.

Meter reading.

155

These results are obtained from a risk analysis on
the different personal data processing activities
carried out by the company with the aim of
reflecting to what extent a processing activity
may cause damage to data subjects due to its
characteristics, type of data and type of operations.

The following aspects of actions and reviews
completed in 2023 are included in the risk analysis:

Binding Corporate Standards project.

Update and implementation of contractual
clauses for employees, customers and suppliers.

Data processing Activity Log review.

Econtrols Privacy Governance project.

A continuous review of implementation and
compliance with the principles of the Regulation
and the LOPDGDD (Spanish Organic Law on
Protection of Personal Data and Guarantee of
Digital Rights) is also carried out:

Management, review and reply to emails received
in the departmental data protection inbox.

Review and analysis of new suppliers, contracts
and systems prior to implementation.

Management of rights of stakeholders.

Conducting on-site visits at national level to
monitor regulatory compliance in offices.

Compliance monitoring management through
questionnaires and meetings via Microsoft
Teams internationally.

Heat map. Initial status May 2018

Heat map. Status December 2023

LIKELIHOOD

Very high-
Maximum

High-
Significant

Medium-
Limited

Low-
Negligible

171

132

468

224

Very high-
Maximum

High-
Significant

Medium-
Limited

Low-
Negligible

127

615

199

Low-
Negligible

Medium-
Limited

High-
Significant

Very high-
Maximum

Low-
Negligible

Medium-
Limited

High-
Significant

Very high-
Maximum

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

End-to-end Water Cycle Management | Service excellence | Page 7 of 22

156

Social action

Although the capacity to set rates and regulate the
services provided in the end-to-end water cycle
in Spain lies exclusively with the Administration,
at Aqualia we actively promote social action
mechanisms in the rates and solidarity funds for
the most underprivileged users. The company has
also worked to improve the coordination with the
city councils’ social services to protect customers
at risk of social exclusion. For example, as part of
its commitment to ESG (Environmental, Social and
Governance) criteria, Aqualia has been renewing its
partnership agreement with Cáritas Española since
2015, subsidising the total water consumption of
all Cáritas facilities in Spain where Aqualia provides
services. To date, more than 350,000 euros have
been subsidised with UNHCR from 2019 onwards,
to support the humanitarian organisation’s
initiatives in Spain. Access to water has also been
guaranteed for anyone in a vulnerable situation.
Custom payment plans were prepared during the
pandemic for customers affected; these have been
maintained and extended over these years.

Information on rates and social vouchers id
available on the Aqualia website for all users. In
turn, in the notifications sent to customers, Aqualia
reports on the possibility of setting up deferred
payment plans. During this year, more than
6,200 payment plans have been agreed in line with
each customer’s needs. During 2023, more than
2,900,000 users had access to subsidised rates
in Spain, 600,000 more than last year, and in other
countries, the number exceeds one million users.

It is essential for Aqualia to expand the company’s
commitment to society, seeking the goal of
excellence in customer service. The company aims
to stand out in the market by developing services
adapted to its users' needs. In 2023, progress
continued in terms of gearing the strategy towards
end customers, particularly focusing on the quality
of the channels used to interact with our users,
enhancing investment in technology.

2,900,000
users
have had access to
subsidised rates
in Spain

A1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023End-to-end Water Cycle Management | Service excellence | Page 8 of 22

4.2.
Efficient and sustainable
management.
Management systems

Aqualia continues to work in the development and
implementation of an Integrated Management
System to:

Ensure compliance with all applicable
contractual and legal requirements.

Provide information and indicators that

guarantee the effectiveness and efficiency of
Aqualia processes.

Enable continuous improvement through targets

and Management System Committees.

That is why, in 2023, we have worked on the
following aspects:

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

157

1 Extending the scope of the Integrated

Management System (Quality, Environment
and Health and Safety, ISO 9001, ISO 14001
and ISO 45001 standards), including new
certificates in the following contracts:

HAAISCO desalination plants (Saudi
Arabia).

Mostaganem O&M Joint Venture
desalination plant (Algeria).

GWP end-to-end water cycle (Georgia).

El Reality PWTP (Mexico).

Treatment Joint Venture Lot 1 (Spain).

2 Definition of documentation and

implementation of a BIM information
Management System according to the
ISO 19650-1 and ISO 19650-2 standards.

3 Implementation of an Asset Management
System according to the ISO 55001
standard in the IDAM Abona contract
(Spain).

4 Reorganisation of the Management
Systems department, fostering the
implementation and completion of internal
audits at international level. One notable
activity is the International Management
Systems Team Meeting held to share
experiences and best practices.

5 Analysis of a new Management System
computer application to improve and
integrate existing options.

6 Continuing to integrate Health and Safety
processes in the Management System:
improved general documentation, specific
documentation by country, integration of
processes and documents and integrated
audits (both internal and external
certification audits).

7 Increase in the efficiency of internal audit
processes, planning and conducting
integrated internal and external certification
audits with very highly-qualified auditors
who perform audits on the Quality,
Environmental, Energy and Carbon
Footprint Management Systems and on
occupational health and safety.

8 Definition of a new certificate structure by
region and/or country in order to improve
the identification and monitoring of local
requirements and the certification audit
process.

9 Carbon footprint: calculation, verification,

reduction and offset actions:

Carbon Footprint Calculation, Reduction
and Offset Project (Lérida, Spain)
(2022-2024): Reduction Plan set for the
2023-2024 period: achieving a 0 footprint
for scope 2 by consuming GdO source
electricity; Offset Plan under analysis in
order to offset 100% of scope 1.

Aqualia Spain GHG Reduction Plan
(Greenhouse Gas) for the 2023-2024
period.

“Calculate+Reduce” 2022 certificate of
the HC OECC Register by MITERD (for
its acronym in Spanish) in Spain.

Hellín Forest Project: analysis of an
offset project by planting 1.5 hectares
of forest at the Hellín WWTP in Albacete
(Spain).

10 Participation in the UNE 343 Committee,

the United Nations Sustainable
Development Goals Management
System, with the aim of participating and
establishing a national position in the
development of the ISO 52001 standard,
which will set the requirements for a United
Nations Sustainable Development Goals
(SDG) management system.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creationEnd-to-end Water Cycle Management | Service excellence | Page 9 of 22

158

4.3.
Energy management

As part of its commitment to contributing to
environmental sustainability, Aqualia has been
implementing strategic measures to control and
reduce greenhouse gas emissions (GHG).

The balance report for 2023 concisely presents
these emissions, detailing their origin in various
processes, as seen in the table:

According to the emission agent, in the table we
can see the impact of each as a percentage.

The sectors graph shows that the greatest
emission agent in the company’s activity
is electricity consumption, accounting for
approximately 31% of all emissions. Other
significant emissions are related to wastewater
management, whether inherent to managed
infrastructure or dependent on volume and
pollution on entering the installation. In this
context, the effective reduction of these emissions
is practically a challenge beyond the company’s
reach.

That is why Aqualia’s strategic plans to control
and reduce GHG emissions have mainly, but not
exclusively, focused on reducing those caused
by electricity consumption. These key initiatives
include:

Reduced electricity consumption with
substantial improvements in the energy
efficiency of systems managed.

Reduction in the emissions factor associated
with energy consumed.

Emissions by origin

CO2 emissions by agent

Supply

Sewerage

Purification

Various

Total

t CO2

121,054

9,915

95,367

226,336

t CH4

t N2O

GEI (t CO2e)

1,789

121,110

9,935

166,866

297,911

40.7%

3.3%

56.0%

0.0%

18%

12%

18%

31%

Fuel

Methane

N2O

Electrical energy

Water bought

Reagents

Sludge and waste

Other

Energy efficiency
improvement plan

The main goals related with reducing energy
consumption are set in the Sustainability Plan
commitments undertaken by the company.

Pl.1 “By 2023, =<27% of the volume of
unregistered water divided by the total volume
of water introduced into the distribution network
(contracts older than 5 years)”.

Pl.2 “By 2023, =<12. Volume of unregistered
water per kilometre of network per day
(contracts older than 5 years)”.

P2.3 “By 2023, 3% reduction in KWh/m3 of
energy used in drinking water adduction,
treatment and distribution processes (weighted
calculation using the m3 managed in each of the
three processes. MWC and BOT contracts older
than 5 years)”.

P2.4 “By 2023. 3% reduction in KWh/Kg COD
removed for energy used in wastewater
treatment processes (weighted average value
for MWC and BOT contracts older than 5 years)”.

The plan is developed according to the
ISO 50001-Energy Systems Management standard
that Aqualia has implemented since 2016.

In accordance with management system
provisions, the contracts included in the
management system scope are subject to an
energy audit-review every four years, pursuant
to the guidelines established in the standard,
which seek to reveal the results of the efficiency
measures implemented since the previous review,
and to propose new measures to improve energy
efficiency.

Improvements proposed are monitored and
implemented with a computer tool included on
the technical report platform, Aqualia RT-BI.

During 2023, these audits were extended to new
contracts in Georgia and Colombia, starting with
training technical staff in these countries; the
first results have been reported in Georgia in
the first phase audit with proposals for renewal
or improvement in various installations. These
proposals are being added to the Infrastructure
Master Plan being drafted by the company for
those contracts.

Reduction of the emission
factor for the electrical energy
consumed

As is known, emission factor refers to the quantity
of greenhouse gas emissions released into the
atmosphere per activity
unit or production unit.

This factor is typically express in terms of carbon
dioxide equivalent (CO2e) emissions, which is the
standard measure that combines the emissions of
different greenhouse gases in terms of the global
warming potential of CO2. Therefore, a reduction
in this factor related to energy consumed entails a
reduction in emissions from that consumption.

The path taken by the company to reduce the
emission factor of electricity consumed is to
consume renewables.

The commitments undertaken in the company’s
Sustainability Plan include:

P.2 “By 2030, 50% of renewable energy
used generated by own facilities, PPAs or
procurement, divided by total energy consumed
(MWC and BOT contracts older than three
years)”.

FCC. Annual Report 2023

159

Solar panels installed at the wastewater
treatment plant in Jerez de la Frontera, Cádiz (Spain).

The goal is currently close thanks to the installation
of self-consumption plants, using biogas resulting
from treatment sludge digestion to generate
electricity, also for plant self-consumption,
cogeneration systems, hydraulic generation, etc.

Using this model, we have been purchasing
76 GWh/year of electricity from photovoltaic plants
since 2020 and a new 75 GWh/year contract
was incorporated in October 2023, also from
photovoltaic plants.

By 2024, 34 MW of solar photovoltaic energy is
expected to being operating in various projects,
basically in Spain.

Another source of renewable energy supply is
purchasing green energy with a PPA (Power
Purchase Agreement).

The company’s energy mix for 2023 was as shown
in the graph below.

The current status of self-consumption plant
implementation can be seen in the following table:

160

Self-consumption plant implementation status

Aqualia energy mix in 2023 (kWh)

Installed power (Kw)

Solar Photovoltaic

Hydraulic

Biogas Generation

Biogas Boilers

Biogas Motor Heat

Gas stations

Total

Georgia

149,700

Spain

6,976

10,888

40,969

16,261

0,17

Czech
Republic

Colombia

Oman

1,736

214

1,757

5,488

1,757

6,000

6,976

1,692

Total

8,712

149,914

18,645

53,433

19,710

0,17

250,414

20%

43%

31%

Non-renewable of the electric mix

Renewable of the electric mix

PPA renewable sources

Self-consumption photovoltaic generation

Biogas generation in treatment

End-to-end Water Cycle Management | Service excellence | Page 12 of 22

4.4.
Improvement projects in
technical management

Operations and technological
transformation

Points common throughout the company in the
technical area are shown below.

support to an important geographic area of
delegations, conducting analyses, classification
of events, studying aeration curves and plant
processes using systems in a centralised manner
once the systems are implemented at regional
level.

Over the course of 2023, the implementation and
development of activities to improve operational
management and the roll out of new platforms to
standardise technical best practices across the
company has continued. Those worth particular
mention include:

Technology hubs

In 2023, we have continued to roll out 9 technology
hubs in Spain, increasing network sensors and
plant control, reviewing systems and operations
so that all systems are fully implemented in
the services, acting as test services for new
developments, and as Operation Centres providing

We have tackled system improvements to have
the capacity to control all systems, incidents
and alarms from the operations centre. This will
generate an operational change and make the
most of synergies in operation areas.

The IOCs (Integrated Operations Centres) will
view what is happening in their area of influence;
all these modifications are being tested at the
Toledo IOC as it is the most advanced in terms of
implementation at Aqualia.

PERTE Spain Projects

The control and proper management of water
use in Spain is a constant challenge. Different
administrations work together towards optimal
management. The PERTE project promotes the use
of new information technologies in the end-to-end
water cycle, which enhance management, increase
efficiency, reduce losses in the supply networks,
and ensure progress in meeting environmental
objectives set by water planning targets and
international regulations.

161

The specific PERTE objectives are:

Enhance water use knowledge to consolidate
integrated water resources management.

Increase transparency in water management in
Spain.

Contribute to meeting environmental objectives
established in water planning targets.

In the second call, Aqualia has worked to create
12 different new projects in order to participate in
a group of applicants and have an impact on the
greatest number of municipalities. The Production,
Legal, Zones, Communication and Operations
departments were involved in achieving this goal
during the last three months of the year, covering
596 municipalities with a requested total subsidy
of 100 million euros.

Detection of digitalisation needs

During 2023, we continued to analyse the detection
of digitalisation needs in all services, to determine
the approximate overall cost of digitalisation of the
services operated by Aqualia. This task has been
mostly completed given the stringent demands in
preparing projects for the Next Generation funds.

Toledo Integrated Operations Centre (Spain).

162

Logistics centres

The goal of the centres is not only to unify the
criteria for service operation in terms of material
quality, but also to harness synergies and promote
common management operations, working in
uniform and optimally organised fashion.

The project arose as a system promoting the
reduction of fixed assets, distribution and service,
lowering the time spent by contracts not only on
the choice of material, but also in order placement
follow-up, etc., favouring internal purchases. The
goals are to minimise service labour when placing
orders, optimise, reduce and control fixed assets
(transfer of service parts), improve prices for large
shipments (suppliers minimise their transport
costs and administrative time), an agreement with
a material transport logistics company, material

traceability using AQ360, favouring invoicing with
SAP internal procurement, connectivity, availability
and service.

Progress was made in the commissioning of two
new logistics centres in 2023. This, together with
the development of a logistics and procurement
centre management tool, will add potential and
unify purchases from these centres in 2024.

Drones

In 2016, Aqualia received drone operator
accreditation from the State Air Security Agency
(AESA) that began with a PHANTOM drone and
a pilot. The Works department, along with the
Operations and Technological Transformation
department, has been evolving with
photogrammetry, topography, works monitoring,

and image processing tests. All developed with
in-house resources and training that has currently
led us to have five pilots, four UAS (Unmanned
Aircraft System), a submarine and a boat. We can
currently tackle complex flight situations in CTR
(Controlled Traffic Region) to fly over urban areas,
so we continue to progress with the equipment
and resources we have available.

This action, along with training specialised staff
in the Zones, facilitates these teams’ operations,
covering numerous aspects of daily services,
such as:

Thermographic leak detection in high pressure
networks.

Review of hot spots in critical electrical
installations.

Inspection of facilities (floor plates, structures).

Surveys and verification of layouts.

Point cloud.

Inspection of interior floor plates in tanks,
channels, etc. by drone boat.

Condition inspection for tanks, water intakes, by
underwater drone.

In 2024, we will continue to advance in the
scheduling of infrastructure surveys due to
their importance, whether at installation or
commercial level or any other requirement. This
point cloud survey using a 3D scanner and aircraft
can be incorporated into a viewer in our asset
management program to give the platform greater
potential.

163

Virtual glasses

These glasses have been proposed for two
purposes:

Remote assistance, so field and office workers
can collaborate in real time with two-way
audiovisual communication, exchanging files,
capturing images. The use of this technology will
enable fast, specialised support with no need for
travel and the person wearing the glasses will
have their hands free so they can work freely.

Training module: learning maintenance activities
is not easy as it requires many interventions
on delicate, expensive equipment. The glasses
allow us to view all the steps needed to
complete a task, handling 3D objects to better
understand the processes and parts.

It is also important to transmit more specialised,
non-routine O&M tasks. This device can transmit
live to a large number of users, sharing knowledge
from anywhere in the world.

Technology transfer: from innovation to
business

Regarding the technology transfer of innovative
products emerging from successful projects by the
company’s R&D&i department, during 2023 three
real-scale draft projects have been incorporated
-two at national and one at international level-,
serving as a commercial offering to propose
to clients. At national level, a Dual Digestion
project was implemented at the Salamanca
WWTP in Spain and an ELAN ANAMMOX project
at the Valdebebas WWTP. Internationally, an
ELAN ANAMMOX project was implemented in
Portugal, at the Frielas WWTP. To complete these
tasks, information on the operation of reagents
installed in Aqualia and data from innovation
pilots were collection so as to jointly define design
data engineering for these two flows, drafting
a technology document that serves for future
projects.

Exchanging knowledge
and best practices

Exchanging knowledge and best practices are
essential for the success of a national and
international company such as Aqualia, allowing it
to create robust, inclusive solutions. Documenting
and exchanging best practices means a company
can learn from its own experiences and errors.
This knowledge can be converted into specific
measures and strengthen its capacity to improve
results and offer a faster, more efficient response.
Moreover, fostering an interdepartmental
knowledge exchange culture can fill information
gaps, increase performance and productivity, and
motivate leaders within the company.

From a global perspective of company technical
management, the department’s goal is to facilitate
the exchange of experiences between different
management areas, establishing different
mechanisms for this purpose as detailed below.

Collaboration with departments.
Health and well-being

Training catalogue: collaboration with the People
and Culture and Knowledge Management
departments to prepare the training catalogue
for 2024. The catalogue contents were reviewed
in terms of technical courses, new courses were
proposed, their content reviewed and trainers
have been proposed from different departments
(engineering, production, innovation and
operations).

Improvement documents. Hydraulic
simulations

With the purpose of unification, in 2023 a
best practice guide was drafted for hydraulic
simulations. This document aims to unify supply
system simulations so they are carried out by any
person dedicated to this task in the same way.

Together with the two documents drafted in
2022, on pump optimisation and analysis and the
audit guide, we will make it easier to achieve the
objectives set in RD 3-2023.

ATEX and Chlorine gas: aiming to create a
mandatory minimum for all of Aqualia’s Chlorine
gas and ATEX installations worldwide. A
multidisciplinary group was created including
all departments involved so as to gain a 360º
vision. Numerous installations in Spain and
abroad were visited to draft this document,
searching for minimums that guarantee the
safety of our employees and installations but
that also have the Aqualia quality seal.

CF Cut-off Protocol: completion of the asbestos
plan and the entry into force of new regulations
requires an adaptation in how we operate,
communication and carrying out the FC cut-off
procedure. During 2023, we worked with Health
and Well-being to establish a new operation,
and we liaised with the body to approve the FC
cut-off work plans.

Operational technical instructions: work was
carried out to prepare an operational instruction
for emptying digesters along with Health and
Well-being. We started with this due to the
need to carry it out at several installations,
its complexity and risk, and the fact that it is
unusual so the operators of these systems have
no prior experience.

164

Poseidón Project

Vehicles

Studies and contracting

Diagnosis and optimisation

In mid-2023, different working groups began
to work to create a new technical tool to make
data captured useful for the service manager,
minimising external loads. To do this, the
necessary data and different plant control
templates were determined, as well as how to
obtain them by incorporating them into the process
and regular functioning of services. The functional
document for this project will be developed in early
2024.

The Plan Moves Flota was requested in 2023 to
minimise administrative tasks involved in applying
for electric vehicle subsidies individually.

At the same time, development and training in
the vehicle management and request tool was
completed, optimising control over projects that
have finalised after developing single framework
agreements for fleet registration, vinyls and
management.

Regarding vehicle telemetry, we have made
progress in implementing industrial vehicles with
around 80% of these vehicles controlled, with all
vehicles to be controlled in early 2024.

We worked with the specialised department
to develop technology innovation solutions for
studies and tenders. Once the needs were studied,
either those set in the specifications or because
they entail a better positioning compared to other
participants, they are adapted and customised for
the plants under tender.

To be able to define actions and optimise/promote
operation improvements, we must understand the
installations managed and what tools are used
to manage them. We must also define actions to
optimise their operation, guaranteeing compliance
with discharge parameters as efficiently as
possible.

Participation in Sector Seminars
and Working Groups

Define, limit risk and establish associated
preventive and corrective measures.

Analyse technical and human resources
assigned to managing installations in order to
standardise management criteria and provide
necessary support where it is detected.

Create the Aqualia brand in installation operation
and maintenance (O&M).

The analysis was divided into three major blocks:
Management, Treatment and Operational Risk, so
different specific actions can be proposed for each
zone or management unit and/or country.

The Treatment area participates in the different
committees and working groups of the AEAS
(Spanish Water and Sanitation Supply Association).
Specifically, it coordinates the participation of
different Aqualia members in the Commission
V working groups. It also coordinates one of
the working groups of this commission, the
Occupational Risk Prevention group. More than
25 lectures have been proposed to present at the
AEAS Congress in Castellón, of which two oral and
five written must be chosen.

Treatment and operation

To determine the actions to be undertaken,
improvements, status, inventory and classification
of installations, we have inventoried and diagnosed
them.

To establish the roadmap, installations were
initially diagnosed, management, control and
monitoring applications analysed, as well as an
analysis of breaches and risk situations for the
company.

New vehicles of the Municipal Water Service in Ibiza (Spain).

165

Analysis of the need for smart
treatment process controls

Implementing smart controls in water treatment
can be an effective strategy for reducing risks,
improving quality and reducing costs. Smart
controls are systems that use advanced
technology to monitor and control production
processes. These systems can detect problems
in real time and take measures to correct them
before they become a bigger problem. During
2023, work was carried out to develop smart
controls that will help to digitalise treatment
plants, helping to have greater control over these
installations.

One is aeration in wastewater biological reactors,
the unit process with the greatest consumption
at WWTPs. This control is beneficial for saving
costs, minimising chemical consumption and
ensuring compliance with all quality standards.
The quantity of air supplied to wastewater reactors
can therefore be adjusted according to the specific
needs of each process. This can reduce energy
consumption with energy savings of up to 20%

in the aeration process, which is the biggest
consumer at the plant, significantly reducing
wastewater treatment costs.

Co-digestion capacity analysis

A study of co-digestion capacity was carried out
at Aqualia installations in Spain. The aim of this
study is to detect installations where co-substrates
external to the WWTP can be co-digested with two
goals in mind. The first is to generate more biogas
to either cogenerate more electricity or, if there is
a natural gas network plant nearby, transform it
into biomethane and inject it into the network. The
second objective is to be capable of processing
sludge from other treatment plants managed by
the company with no anaerobic digestion in their
treatment line.

The study has not only identified installations with
“extra volume” in their digestor but has also taken
into account other relevant factors such as motor
generation at the plant, if discharge authorisation
requires nutrients to be eliminated from the
water line and whether refurbishment actions are

necessary in the sludge line in addition to those
required to receive and feed external co-substrate.

Installation optimisation with
simulation tools

The most relevant conclusions are that, of the
25 plants with anaerobic digestion in Spain,
19 have “extra volume” in digestion. Of these
19 plants, only seven have motor generation and
do not require refurbishment in the sludge line.
However, the Discharge Authorisation requires
nutrient eliminate so we would have to review
of whether biological treatment is capable of
assuming the extra returns from the sludge line or
consider building an ELAN ANAMMOX for them.
Seven plants do not require nutrient elimination
from the water line. Two have motor generation but
actions are necessary to refurbish the sludge line.

The overall conclusion is that, although co-
digestion is a possibility at 19 Aqualia plants,
investment is needed not only for external
co-substrate reception and feeding. Additional
investment must be added for a motor generator,
an ELAN ANAMMOX or to refurbish the sludge line,
depending on each installation.

Process simulation tools are a highly valuable
instrument for plant operation. Once a plant has
been calibrated in the simulator, the possible
benefits are multiple as different process scenarios
can be simulated to see the effects on the effluent
without having to run real tests that compromise
discharge quality. The main goal pursued is
to optimise plant operation in terms of energy
consumption, chemical reagent dosing and biogas
production.

Some installation simulations were run throughout
2023 to verify whether the plant built was capable
of processing real flows and pollution loads while
meeting the discharge parameters set in the
authorisations. Real examples are AITASA in Spain
and Aguas de la Sabana in Colombia.

Plants with special monitoring

Specialised technical support

A list has been defined of plants that require
special attention or monitoring due to their
complexity, possible optimisations or improvement
needs. Once defined, control and improvement
KPIs will be set to assess and analyse at
monitoring meetings.

In 2023, extensive specialised support for
production was provided both internationally and
nationally.

At national level in 2023: a feasibility analysis of
the cogeneration installation at Zone III plants and
support in the AITASA IWTP, a plant designed, built
and operated by Aqualia with a proposed objective
to create a “lessons learned” document in 2024.
Highlights at international level include support
in Colombia for different company contracts,
conducting visits and providing technical support.

Coordination of support
for operational needs

Unique operational improvement projects

Another department task is to coordinate
production support needs involving collaboration
with other departments. Production reports
specific needs arising at the plants and the
department analyses whether the work requires
collaboration with the Engineering department
or, otherwise, if it can be solved without their
involvement.

166

Many operational needs have been transferred
to Engineering in 2023 at both national and
international level. Nationally, a catalogue of
compact UF and NF solutions was prepared
to comply with RD 03/2023, which sets more
restrictive limits for sulphates and for suspended
solids. This project was requested from Zone II
but, given that it is of interest nationwide, it was
transferred to the other zones. Another relevant
job at national level was for Zone III. It consisted
of design projects for cogeneration installations
at four WTTPs, of which two will be implemented
in 2024. Internationally, the project to extend the
Gardabani treatment plant in Georgia and the
Aguas de la Sabana treatment plant in Colombia
stand out.

Unique plant operation monitoring

The installation perimeter analysis identified plants
that require special monitoring, either because
they include innovative or unique technology
processes or as they are a benchmark in the type
of treatment. This monitoring has two purposes:
to verify optimum operation and provide updated
information that can be used if references are
requested in tender processes.

AITASA Industrial Wastewater Treatment Plant in Tarragona (Spain).

167

Water quality and discharges

Performance improvement plan

Selected service review plan. Gradual review of
objectives.

Technological transformation

Water Quality working group

This working group has analysed the impact of
the new requirements included in the new Royal
Decree on Water Quality that affect the inclusion
of new parameters and types of analysis, the
preparation of Water Health Plans focused on
the identification and management of risk in
water supply infrastructures, and increased
transparency. And regarding reporting, providing
public information on infrastructures and analytical
results.

Estimation of the impact of RD3/23

The entry into force of the new water quality
regulation has not only led to intense development
of functional documents and testing to adapt and
improve current systems that today require great
dedication in terms of time, but also the economic
impact of applying this new regulation at service
level has been estimated to transfer those costs.
Analytical requirements, hydraulic simulations,
sensors and notification of hydraulic audits and IFE
indexes are all affected.

A Hydraulic Performance Improvement Plan was
implemented in 2023, selecting the towns where a
greater return leads to economic improvement in
the different geographic areas.
The plan focuses on improvement action in:

Remote control and flow control.

Hydraulic Audit Plan: With the entry into force
of RD 3/23 and various European regulations,
hydraulic audits must be conducted and sent.
A first model milestone has been prepared,
focusing on the ILI index which today is being
completed by all services with more than
10,000 inhabitants. This point is necessary and
will be implemented in all the services indicated.

Hydraulic Efficiency Plan. A prediagnosis is
necessary to identify weaknesses in the network,
propose and implement an action plan and
optimise actions from a technical and economic
perspective.

Sectorisation. This makes is possible to conduct
continuous, precise control to instantly detect
leaks and minimise water loss.

Asset renewal. Renewal of meters to replace
older models with new, more accurate models
or smart metering to control consumption more
efficiently and with a frequency under 24 hours.

One of the biggest challenges is boosting
operational improvement through digitalisation
and the design and use of management tools
that are useful for service managers and
plant management and, in turn, serve as an
information reporting mechanism, thus reducing
the bureaucratic and administrative workload of
service managers. As the implementation and
start-up progresses, systems evolve and benefit
from the experience and the new needs that
are analysed and developed along with the IT
department. Progress has been significant
this year.

Search for leaks in own resources,
fundamentally intended to maintain the current
NRW rate.

Search for leaks in external resources linked
to the framework agreement closed for this
purpose.

Improvement in active pressure management.
Investment in active pressure management
equipment and regulators in certain areas of
study.

Improvement in materials by formalising a
unified material quality framework agreement.

Linear asset studies. Renewal and investment
based on the repair index, resources allocated
and their costs to propose renewals to the
relevant administration.

168

Aqualia Live Platform.

Aqualia Live development

GEO

Work continued in 2023 to develop the Aqualia
Live platform, with meetings of the groups created
in 2022 to promote needs along with the IT
department. The aim is also to take a snapshot of
the current level of actual usability.

In 2022, a study was launched to analyse its
implementation, level of detail and updating of the
GIS, to take action and focus efforts on correct
system implementation, since the GIS is the core
of the other systems. This study was extended to
all areas and countries and has been incorporated
as a management report on the GEO web platform
so that anyone with an administrator profile
can view this snapshot and the evolution of the
different GIS under their control. A control panel
has also been requested on the GEO platform
to make it easier to interpret results and visually
analyse GIS evolution.

During that year we have also continued to
implement GIS in contracts in France and Villa
del Rosario (Colombia). GIS implementation has
also begun in other contracts in Colombia, in the
Los Cabos Integrated Management Improvement
(IMI) Project in Mexico and, in late 2023, studies
began to implement our GIS in the town of Rustavi
(Georgia) as a step prior to implementation in
Tbilisi, as well as implementation in two contracts
in Portugal: Aquaelvas and Aquacampomaior.

Following on with the continuous improvement of
the GEO platform and due to the characteristics
of supply in LATAM countries, by rotation, a
request has been made to improve the platform,
introducing household cisterns as an element
and exporting them to EPANET so as to run more
realistic simulations of these systems.

Different requirement documents have been
drafted to continue along the line of being able
to create digital twins of supply networks. This
first step aims to simulate what happens in the
supply network when there is a mincut since this
must be replicated in the simulation. In line with
reducing the NRW, requirements have been drafted
so that remote detection can be used to located
swimming pools in our contracts, associating
them with the supply ID and the GEO-Diversa
connection to locate contracts that have no
substantial changes in consumption and thus
alert to a possible NRW. One notable milestone
in Geo was the implementation of the GEO app
that can be used to survey elements in the supply
and sanitation network via an app. This can work
with the GPS on the mobile device, which affects
location accuracy, or by linking to an external GPS
with bluetooth technology for precision to the
centimetre.

With this app, any operator with two hours of
training would be capable of surveying network
elements, offering tremendous potential when
updating or creating a new GIS.

An information flow has been implemented in the
data control line to determine who and when a GIS
is locally downloaded in any format. Information
in the GIS must be protected against unauthorised
or fraudulent downloading. In this way, when
downloading, the user will be informed that their
manager will be informed of the download.

AQ360. Asset Management

Implementation of the Asset Management tool has
continued; it has been implemented in a total of
94 installations to meet the objective of 37% of the
volume treated in Spain.

Seed maintenance ranges have also been defined
for implementation in all installations. These
ranges are at subfamily and legislative level to
promote legal maintenance control.

Continuing with the implementations ongoing
in late 2022, where the asset management
system was implemented and operational at the
Villa del Rosario PWTP (Colombia) and Usine
de Vaucouleurs PWTP, (SEFO), implementation
has been extended to: Colombia (all contracts),
Portugal (Aquaelvas and Aquacampomaior
contracts) and Georgia (Gardabani WWTP).

AQ360. Work Orders

In relation to AQ360 implementation is still at 100%
in Spain and the platform continues to operate
correctly.

In 2023, testing concluded to be able to select
the element affected by a fault. This operation
is fundamental to then prepare investment
plans. Implementation is expected in all services
throughout 2024 and for this reason a new
management report has been requested that will
indicate how many Work Orders (WO) have an
affected element, thus being able to display the
corresponding visual.

This tool is widely used on the mobile app, both the
clients section (91%) and Work Orders for networks
and installations (88%) thanks to training efforts
and field work in services. Since late 2022, asset
management work orders are derived and solved
with mobility.

Internationally, it was operational in the Villa del
Rosario (Colombia) and SEFO (France) services
by late 2022. Training was provided in 2023
for the other contracts in Colombia and two in
Portugal (Aquaelvas and Aquacampomaior).
Implementation will begin in the first quarter of
2024. However, effort is required in Colombia
to connect the client platform with AQ360 as
notices must currently be duplicated as there is no
connection between the platforms, causing some
rejection towards its implementation.

At the same time, implementation to select the
element affected with mobility is under completion,
meaning that the operator will be able to select
the element they are working on. This will provide
knowledge on the number of faults in that element
and dates of intervention, all with a focus on good
infrastructure management, using this information
for infrastructure renewal plans.

SCA

The integration procedure was studied in 2023,
initially planned to implement 14 new contracts on
the SCA platform. This requires a detailed roll-out
plan to properly implement the solution.

169

AWA (Aqualia Water Analytics)

Three treatment pilot locations in Spain were
selected to develop the tool:

During 2023, we continued to implement AWA,
reinforcing its usability in the Operations Centre
environment and introducing new applications
aimed at greater digitalisation and help with
decision making.

With this application we can take another step
in the digitalisation process and analyse data by
using artificial intelligence algorithms. AWA is a
highly effective tool to help with processing and
analysing laboratory ad process data, as well as
flows and consumption collected in the corporate
SCADA database, establishing a Decision Support
System (DSS), alarms and direct actions on
equipment and processes.

Improvements proposed include:

AWA features for Operations Centres
(IOC – Integrated Operations Centre).

Leak Detection Module – AQ360 connection
(WO creation and management on AWA).

Investment Plans.

Obtaining the performance of all service sectors
in the time period selected (related with the new
CMN module) (in process).

Large consumer test (in process).

Correlation factor (demand forecast).

Lérida WWTP, which currently has various smart
controls implemented that will help with their
design.

Salamanca WWTP, a similar size and process as
the Lérida WWTP, where the same controls can
be developed by with in-house technology.

La Puebla de Montalbán WWTP, Toledo, smaller
than the others but with the most common type
of treatment in plants operated by Aqualia.

The following developments are in progress for
integration in the platform:

Pollution by image: early detection with images.

Balances and relationships between
consumption of drinking water served and
quantity of wastewater received at our
installations.

Centrifuge and poly dosage regulation.

Decision-making help system in digestion.

Aeration control.

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at the highest level

End-to-end Water Cycle Management | Service excellence | Page 21 of 22

Aqualia-LAB

The entry into force of the Royal Decree on the
Quality of Water for Human Consumption is
causing a change in our procedures, including how
analyses are managed. A functional document
has been drafted, and a new web portal has
been developed, where all the planned analyses
have been integrated, under current Water
Quality legislation, carried out by both accredited
laboratories and the other certified laboratories.
This portal provides access to all reports, and
all the information about the infrastructures is
linked to the National Drinking Water Information
System (SINAC), such as Water Supply Zone
infrastructures. All this consolidated information
will serve as a basis for implementing some of the
requirements set forth in the new Royal Decree
3/2023 on water quality. At this time it is important
to have all the analytics in a single portal, for
consultations in the other systems, or to migrate
them for different utilities.

It will also be possible to upload all external
analysis and mandatory reports and thus monitor
compliance with legal requirements of discharge
and water quality.

4.5
Technical knowledge
management

The Knowledge Management Area began working
in 2022. Its main duties are summarised as:

Concentrate existing “know-how” in the company
and make it available to the organisation.

Encourage interactive communication of
experiences and knowledge.

In partnership with the Training area, collect
training needs, adjusting them to different
technical job profiles.

Regarding the first objective, a platform is being
implemented to collect all existing documentary
“know-how” dispersed within the organisation
(technical procedures, work instructions,
best practices, manuals, etc.), extended with
information from external sources. All with the
collaboration and engagement of the entire
organisation.

The first phase was completed in 2023 by creating
the platform divided into themes.

Document collection has begun and a search
engine is under development using AI tools.

General roll-out in the organisation is expected for
the second half of 2024 once the search tool and
screening system for information collected are
ready.

Aqualia Laboratories.

170

4.6
Accredited laboratories

Aqualia currently has a network of laboratories
accredited by ENAC, Acreddia, CAI and GAC,
under the Aqualia-LAB brand. It includes seven
laboratories in Spain (Oviedo, Vigo, Lérida, Ávila,
Jerez de la Frontera, Badajoz and Adeje), one in
Italy (Caltanissetta), two in the Czech Republic
(Ostrava) and one in Georgia (Tbilisi).

RD 3/2023 was published and entered into force
in Spain in January 2023, setting the technical-
sanitary criteria for the quality of water for
consumption, its control and supply in Spain.
This RD transposes Directive (EU) 2020/2184 of
the European Parliament and of the Council of
16 December 2020 on the quality of water intended
for human consumption.

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171

The increased number of analyses generated by
the entry into force of this new law applicable to
Aqualia-LAB can be quantitively summarised in the
table below.

The increased number of samples corresponds
to the Observation List and Operational Control
analyses incorporated in the new legislation.

To face this sharp increase with guarantees,
including the accreditation of new techniques,

requires us to expand human and material
resources, and extend and adapt some of the
laboratories to gain the space needed, not only for
the new analytical techniques, but also to manage,
transport and store samples given the drastic
increase in their number.

First, a new laboratory was installed to replace
the lab in Ávila (Spain) and it began operating in
October 2023. This new 400 m² laboratory replaces
the old 90 m² facility with new storage, training
spaces, etc.

Increased number of analyses

Increased number of samples

Parameters

Coliphages

Vinyl chloride

Epichlorohydrin + acrylamide

Aerobes at 22ºC

Enterococci

Characterisation

Operation control pesticides

Microcystin

Glyphosate

Entry into force

No. Full year
analyses

Parameters

Entry into force

No. Full year
analyses

2023

13,699

Bromate

5,070

4,190

Nitrites

Chlorite

18,765

Chlorate

13,554

Bisphenol A

1,228

6,752

2,936

5,378

Haa

Pfa

Observation list

Uranium

Total no. Analyses

2023

2024

4,063

3,294

4,550

5,070

4,199

4,190

1,507

3,640

106,635

Observation list

Operational controls

Characterisation

Increase samples new RD

Samples 2022 (before new RD)

Increase in samples (%)

1,507

9,549

1,228

12,284

27,060

45.4%

5. Innovation and technology

172

Innovation activities at Aqualia promote the
transition to a circular economy with zero carbon
footprint in line with European Green Deal policies.
The Innovation and Technology Department (ITD)
develops new sustainable services and processes
using intelligent and eco-efficient management
tools. To this end, Innovation and Technology
Department projects support company activity
in achieving the United Nations Sustainable
Development Goals (SDGs) with special emphasis
on affordable, high quality water and sanitation
services (SDG 6), optimised energy balance (SDG
7) without affecting the climate (SDG 13) and
responsible production and consumption (SDG 12).

ITD activities can be divided into six lines of work.
The following table lists the 21 projects carried
out by the ITD in 2023 (in addition to the start and
completion dates) as well as the main lines. Main
lines are in blue and secondary in grey.

Three projects involving Aqualia were completed
in 2023:

1 Marie Sklodowska Curie European Industrial
Doctorate training project: Rewatergy. To recover
hydrogen from wastewater and develop new
oxidation methods.

1 EU LIFE project: Ulises. On energy self-
sufficiency and waste recovery at conventional
WWTPs using novel, low-cost technologies.

1 RIS3 (Regional Innovation Strategies for Smart
Specialisation) project with ERDF funds from
the Regional Ministry for the Economy, Science
and Digital Agenda of Extremadura: Efluent-EX.
Researches the use of biowaste as a sustainable
source of renewable energy, mobility and
bioproducts.

Work has continued on the other 17 projects under
way:

5 from the European Life programme: IntExt,
Phoenix, Zero Waste Water, Infusion and Reseau.

2 from the EU Common Initiative H2020/Bio-
Based Industries (BBI): B-Ferst and Deep Purple.

4 from the EU H2020 programme: Sea4Value,
Ultimate, Rewaise and Nice.

2 CDTI Science and Innovation Missions on
renewable gases: Eclosion and Zeppelin.

3 from the new EU Horizon Europe framework:
D4Runoff, Cheers and Ninfa.

1 from the Mixed Research Unit (MRU)
programme with ERDF funds of the Axencia
Galega de Innovación (GAIN): Aquatim - to study
and implement new technologies throughout the
end-to-end water cycle.

A new project has been selected in the Sustainable
and efficient industrial water consumption
CL6 40-01 call for the EU Horizon Europe 2023
programme: Resurgence (Industrial water
circularity: REuse, reSoURce recovery and enerGy
efficiENCy for greenEr digitised processes).

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

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Financial
Statements

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FCC. Annual Report 2023

173

End-to-end Water Management Cycle | Innovation and technology | Page 2 of 10

Aqualia energy mix in 2023

Record

Acronym

Full name

Start

End

Sustainable
treatment

Reuse, puri-
fication and
sustainable
desalina-
tion

Sustaina-
bility and
energy
efficiency

Circular
economy
and biofac-
tories

Industrial
water

Digital
develop-
ments

18 02

H2020
REWATERGY

Sustainable Reactor Engineering for
Applications on the Water-Energy
Nexus

2019 2023

19 05

LIFE ULISES Upgrading wastewater treatment

2019 2023

22 01

RIS3
EFLUENT-EX

plants towards energy self-sufficiency
and zero-waste concept

Research on the use of biowaste in
Extremadura: sustainable source
of renewable energy, mobility and
bioproducts

2022 2023

19 03

BBI B-FERST Bio-based FERtilising products as

2019 2024

the best practice for agricultural
management SusTainability

19 04

BBI DEEP
PURPLE

Conversion of diluted mixed urban
bio-wastes into sustainable materials
and products in flexible purple
photobiorefineries

2019 2024

Reuse, puri-
fication and
sustainable
desalina-
tion

Sustaina-
bility and
energy
efficiency

Circular
economy
and biofac-
tories

Industrial
water

Digital
develop-
ments

Record

Acronym

Full name

21 03

MISIONES
ECLOSION

21 04

MISIONES
ZEPPELIN

New materials, technologies and
processes for the generation,
storage, transport and integration of
renewable hydrogen and biomethane
from biowaste

Research in innovative and efficient
technologies for the production and
storage of green hydrogen based on
the circular economy

Start

End

Sustainable
treatment

2021 2024

20 04

20 05

H2020
REWAISE

REsilient WAter Innovation for Smart
Economy

2020 2025

LIFE PHOE-
NIX

Innovative cost-effective multibarrier
treatments for reusing water for
agricultural irrigation

2020 2025

21 01

H2020 NICE Innovative and enhanced nature-

2021 2025

based solutions for sustainable urban
water cycle

19 06

LIFE INTEXT Innovative hybrid INTensive-

2019 2024

21 02

LIFE RESEAU RESilience EnhAncement in the Urban

2021 2025

EXTensive resource recovery from
wastewater in small communities

20 02

H2020 SEA-
4VALUE

Developing radical innovations to
recover minerals and metals from
seawater desalination brines

2020 2024

20 03

20 06

H2020
ULTIMATE

indUstry water-utiLiTy symbIosis for a
sMarter wATer society

2020 2024

LIFE ZERO
WASTE
WATER

Positive energy wastewater treatment
plant for combined treatment of
waste water and bio-waste in small
populations

2020 2024

20 07

LIFE INFU-
SION

Intensive treatment of waste
effluents and conversion into useful
sustainable outputs: biogas, nutrients
and water

2020 2024

Main line of activity

Secondary line of activity

water sector

22 04

UMI AQUA-
TIM

Mixed research unit: sustainable
future of the circular, efficient and
resilient water cycle.

22 02

HE D4RU-
NOFF

Smart implementation of adaptive
hybrid solutions in sewage networks
for preventing and managing diffuse
pollution from urban water runoff

2022 2025

2022 2026

22 03

HE CHEERS Producing novel non-plant biomass
feedstocks and bio-based products
through upcycling and the cascading
use of brewery side-streams

2022 2026

22 05

HE NINFA

TakiNg actIoN to prevent and mitigate
pollution oF groundwAter bodies

2022 2026

23 01

HE RESUR-
GENCE

Industrial water circularity: reuse,
resource recovery and energy
efficiency for greener digitised
processes

2023 2027

End-to-end Water Management Cycle | Innovation and technology | Page 3 of 10

5.1.
Sustainable treatment

The following results have been obtained from the
four projects completed in 2022:

Talavera de la Reina Wastewater Treatment Plant,
in Toledo (Spain), which houses the demonstration
platform for 16 technologies.

EU MSCA - Rewatergy

Life Zero Waste Water

This project focuses on scientific training, under
the H2020 Marie Sklodowska Curie programme
for European academic networks. It was led
by Rey Juan Carlos University in Madrid and
Aqualia was an industrial partner hosting two PhD
researchers to conduct technology development
work at its treatment plants: at the Lérida WWTP,
methods were developed to absorb ammonia
from wastewater and convert it into hydrogen in
collaboration with the University of Cambridge;
at the Jerez de la Frontera WWTP (Cádiz), photo
and electrodisinfection processes were assessed
to eliminate micropollutants from drinking or
wastewater, supported by Ulster University
(Northern Ireland).

Life IntExt

The project optimises low-cost wastewater
treatment technologies in small towns to minimise
the energy cost, carbon footprint and waste
treatment. Led by Aqualia, the AIMEN and CENTA
technology centres, and the University of Aarhus
(DK), it evaluates ecologically and economically
sustainable solutions for urban centres with fewer
than 5,000 inhabitants, supported by specialised
SMEs from Germany, Greece and France.

At the Talavera WWTP (Toledo), managed
by Aqualia, the demonstration platform of
16 technologies is operated, comparing different
systems (wetlands, algae, biofilm reactors or
granular sludge). The wetlands are also tested
at the facilities of the Andalusian Environment
and Water Agency in Seville province to quantify
the climatic effect and to compare various
pretreatment options (Push, Imhoff).

With Aqualia as leader and with Canal de Isabel II
as a partner, this project has installed a combined
treatment unit for urban wastewater (USW) and
organic fraction of urban solid waste (OFUSW) at
the Valdebebas WWTP (Madrid). For achieve a zero
carbon footprint treatment process, an anaerobic
reactor was installed with AnMBR membranes,
producing biogas, followed by the ELAN® in-line
water process to remove nitrogen with low energy
consumption. OFUSW management is assessed
transporting the organic matter mix in a single
stream to the sewerage system.

In addition to the University of Valencia (co-holder
of the AnMBR patent) and the University of
Santiago (co-holder of the ELAN® patent),
the Portuguese SME Simbiente is involved in
developing an advanced management system,
combining with the online microbiology quality
monitoring from the Austrian SME VWS (Vienna
Water Systems).

Life Infusion

This project is coordinated by the Metropolitan
Area of Barcelona (AMB) and arises as a
continuation of the Life Methamorphosis
project. The pilots prior to the project are used
at the Ecoparc 2 in Barcelona to design new
waste recovery plants from urban solid waste.
In collaboration with the EureCat centre for
technology and the operator of Ecoparc 2, EBESA,
the leachate digestion system was optimised
with technology developed by Aqualia, AnMBR
and ELAN®, adding an ammonium stripping
system produced by Belgian firm Detricon. This
process will be transferred to COGERSA, the

174

waste management entity in Asturias, to assess
the new leachate management solutions at its
plants.

LIFE Reseau

The RESEAU project seeks to increase the capacity
and resistance of existing hydraulic sanitation
infrastructure against the impact of climate
change. Led by Aqualia with the involvement of
ITG (Fundación Instituto Tecnológico de Galicia)
technology centre and VCS (Vand Centre Syd AS)
public operator in Odense (Denmark). Sensors
(speed, flow, level, etc.) have been installed in
the sanitation network of Moaña (Pontevedra),
operated by Aqualia, to monitor and model its
behaviour. The goal is to develop a flexible flow
management model.

In addition, a 500 m3 aerobic granular reactor
is being built at the Moaña WWTP to treat up
to 2,000 m3/day of wastewater. This advanced
biofilm system multiplies biological treatment
capacity compared with conventional activated
sludge while improving the WWTP’s adaptability to
load variation and reducing the space necessary
for implementation. It also significantly reduces
the environmental impact of the treatment by
reducing energy needs and avoiding the emission
of greenhouse gases.

175

5.2.
Reuse, purification
and sustainable
desalination

H2020 Sea4Value

Life Phoenix

H2020 Rewaise

The EureCat technology centre coordinates this
fully EU-funded project with fourteen partners
from seven countries to recover resources from
concentrated brines at Seawater Desalination
Plants (SWDP). At least eight innovative technology
solutions are being developed at basic scientific
level. The aim is to enrich the most valuable
components of seawater (lithium, caesium and
rubidium) and recover critical raw materials
(magnesium, boron, scandium, gallium, vanadium,
indium, molybdenum and cobalt) to a level of purity
that makes market exploitation feasible.

Aqualia’s Desalination Innovation Centre in Dénia
(Alicante) has been reinforced and a new test
platform installed in Tenerife, as well as pilot units
at several SWDPs operated by Aqualia. These
locations analyse the technical and economic
impact of more sustainable desalination methods
and new solutions for brine recovery. Work will be
done on the solar concentration of brine, selective
magnesium precipitation, the acquisition of
chlorine dioxide and the optimisation of permeated
remineralisation with micronised limestone, to
reduce CO2 consumption, cloudiness and the size
of facilities.

Led by Aqualia and supported by the CETIM
and CIESOL technology centres, this project will
optimise the tertiary treatment to achieve the most
ambitious goals of the new European water reuse
regulation (EU 2020/741). Aquas de Portugal,
Almería Provincial Council and Confederación
Hidrográfica del Guadalquivir provide the project
with several locations to assess effluents with
various mobile plants.

This equipment combines physical and chemical
treatments with advanced filtration and various
ultra and nanofiltration membrane refining skids.
Furthermore, the European subsidiary Newland
Entech is testing ozone and ultraviolet light
modules, which will allow advanced oxidisation
and disinfection. To continuously monitor reused
water quality, a sensor from Dutch firm MicroLan
is integrated into the tests to enable in-line
microbiological measurements and respond to risk
controls required by the new EU reuse regulation.

In the EU H2020 Smart Water Economy call,
Aqualia participates in two of the five consortia
selected, which have combined forces in the
CirsEau cluster. Rewaise project is the first with
Aqualia acting as coordinator of the 25-member
consortium, which includes water companies
from the UK (Severn Trent), Sweden (Vasyd) and
Poland (AquaNet). Together with seven SMEs
and universities in Croatia, Italy, Poland, the
Czech Republic, Sweden and the United Kingdom,
new circular economy and digital management
solutions are being implemented in “living labs”
including Aqualia operations in Asturias, Badajoz,
the Canary Islands, Dénia, Salamanca and Vigo.

Rewaise will enhance Aqualia’s strategic lines of
technological development, such as sustainable
desalination and new membranes, the recovery
of brine materials, the reuse of wastewater and
its transformation into energy and by-products.
This project also has an important line of action in
digital development to improve process operation
and control, working to simulate networks and
plants, optimising service efficiency and water
quality.

5.3.
Sustainability and
energy efficiency

EU MSCA - Rewatergy

In addition to sustainable treatment as mentioned
previously, at the Lleida WWTP, methods for the
absorption of ammonium from wastewater and
its conversion into hydrogen were developed in
partnership with the University of Cambridge
(England).

Life Ulises

Three technology centres, CENTA, EnergyLab
and CIESOL (University of Almería), and Aqualia
as coordinator, have worked to transform
conventional WWTPs into "energy and biofertilizer
production factories", achieving energy self-
sufficiency and eliminating their carbon footprint.
Anaerobic pretreatment with the PUSH reactor
has been implemented at the El Bobar WWTP
in Almería, which has also been successfully
assessed in Portugal, first at two WWTPs operated
by Aguas de Algarve and then at the Cartaxo
WWTP operated by Aqualia.

To improve the energy balance in Almería, bio-
methane is used as fuel for vehicles supplied at
a petrol station fed with an ABAD BioEnergy®
refining system. Fertiliser production strategies
include the development of struvite precipitation,
enzymatic hydrolysis and Fresnel lens solar
disinfection.

Missions Eclosion

Co-funded by the CDTI, the project aims to create
new materials, technologies and processes for the
generation, storage and transport of renewable
and indigenous gases such as hydrogen and
biomethane. These energy carriers will be
produced from urban waste, agri-food, wastewater
and sewage sludge, and will be accompanied by
eco-efficient, flexible and intelligent optimisation
tools.

The consortium of eight companies, led by
Aqualia, together with FCC Medio Ambiente, CADE,
Ghenova, ARIEMA, H2B2, Idecal and MindCaps,
carries out the research in four development
centres, the Valladolid Waste Treatment Centre,
managed by FCC Medio Ambiente, and the
wastewater treatment plants in Salamanca, Lérida
and Jerez de la Frontera, managed by Aqualia.
Bio-electrochemical processes for the generation
of renewable gases, thermochemical treatment
with supercritical gasification, and new processes
for separation and storage of the gas mixtures
produced to generate high quality pure gases will
be researched.

A2_
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Report

FCC. Annual Report 2023

176

Aerial view of the El Bobar treatment plant in Almería (Spain)

companies in the hydrogen value chain: Repsol,
as leading domestic hydrogen producer and
consumer; Naturgy, Redexis and Reganosa, as gas
distributors; and Norvento, Perseo and Técnicas
Reunidas as technology partners.

The companies are collaborating with nine
research organisations (including CETIM,
CIEMAT, EnergyLab, CIDAUT, and IMDEA-Energía)
to implement, at the Algeciras WWTP (Cádiz),
managed by Aqualia, several innovative hydrogen
production pilots that can supply large hydrogen
consumers in the field, including Acerinox, Viesco,
Air Liquide, Linde, and port companies.

Missions Zeppelin

A second project co-funded by the CDTI is
researching a flexible set of green hydrogen
production and storage technologies based on
the use of waste and by-products (agri-food,
textile, sewage treatment plants, from refineries,
etc.). The aim is to produce this carrier more
efficiently, addressing the technological challenges
related to biogas and bioethanol reforming, dark
fermentation (DF), microbial electrolysis (ME),
gasification, and hydrogen storage.

With new models for obtaining green hydrogen that
complement electrolysis with renewable energies,
decarbonisation is promoted under the principles
of the circular economy and digitalisation. The
consortium led by Aqualia includes seven key

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177

5.4.
Circular economy
and biofactories

RIS3 Efluent-EX

The Efluent-EX project is funded by ERDF RIS3
regional specialisation funds as part of the
commitment undertaken by the autonomous
region of Extremadura for the green circular
economy. To promote clean energies and reuse
of organic and agro-industrial waste, Aqualia
is working to convert WWTPs into biofactories

and sources of renewable energies, promoting
sustainable mobility with green biofuels.

H2020 BBI B-Ferst

and new inputs for the chemical and cosmetics
industry.

At the Badajoz WWTP, managed by Aqualia,
solar solutions are implemented to heat the
digesters, with photovoltaic panels and a
Fresnel lens solar drying and sanitising system.
To maximise biomethane and hydrogen
production, agro-industrial substrate co-digestion
was optimised assessing inventories and
characteristics of agricultural, livestock and
food industry waste (wineries, fruit, vegetable
and dairy processing plants). Various thermal
processes were also tested to transform end
solid water in carbonaceous materials (biochar):
hydrocarbonisation, pyrolysis and activation.

After optimising the first photobioreactor prototype
at the Toledo-Estiviel WWTP, a demonstration
reactor that is 10 times larger was built in 2022
at the Linares WWTP, with a similar installation
completed at the Badajoz WWTP. A biogas
purification column is installed in SmVaK in the
Czech Republic to increase generate performance.

HE Cheers

Coordinated by beer group Mahou-San Miguel with
the participation of 10 partners from five European
countries, including Aqualia and its subsidiary
Hidrotec, the AINIA technology centre and the
University of Valladolid. The project aims to give
value to underused or wasted by-products from the
beer industry, such as husk, wastewater, CO2 and
methane.

With a biorefinery approach inspired in the
biodiversity of nature (insect and microbe
platforms), five innovative bioproducts that are
competitive at market level are generated: insect
protein, disinfectant, microbial protein, ectoine
and caproic acid. New sustainable transformation
bioprocesses are validated on a demonstration
scale to achieve a 50% reduction of the carbon
footprint in each value chain.

Fertiberia is leading the project to develop
new biofertilisers from urban wastewater and
by-products of agri-food industries, with the
participation of Aqualia and ten partners from six
different countries. The potential of raw materials
recovered from urban waste and effluents to
produce fertilisers in three countries (Spain, Italy
and the Czech Republic) is being studied. A struvite
precipitation facility is operated at the Jerez de
la Frontera WWTP (Cádiz), managed by Aqualia,
to incorporate the phosphorus recovered in a
new Fertiberia biofertiliser demonstration plant in
Huelva.

Work is ongoing to verify that the Aquavite®
product complies with the limits set in legislation
2019/1009 on fertiliser products, both in terms of
phosphorous oxide content (16%) and presence
of pathogens. An infrared thermal dryer is also
being tested for disinfection. The resulting
product is also used to recover land affected
by forest fires in Ávila. Finally, agri-food sludge
is being characterised as waste at the Coosur
WWTP (Jaén, Spain) operated by Aqualia to be
incorporated into Fertiberia formulations.

H2020 BBI Deep Purple

Aqualia, with support from thirteen partners in six
countries, is implementing a new demonstration-
scale biorefinery model in the project, integrating
phototrophic purple bacteria (PPB) in anaerobic
carrousels. These bacteria use solar energy to
purify non-aerated wastewater and transform the
organic content of wastewater and urban waste
into raw materials for biofuels, plastics, cellulose

Deep Purple Project at the Wastewater Treatment Plant in Toledo (Spain).

5.5.
Industrial water

H2020 Ultimate

HE Resurgence

The Ultimate project is the second of the EU H2020
Smart Water Economy call that Aqualia participates
in. Dutch technology centre KWR coordinates
27 partners who implement, in nine living lab
locations, innovative industry and water service
synergy demonstrations.

Aqualia has installed an industrial-scale fluidised
anaerobic reactor (FBBR / Elsar) at the Mahou-
San Miguel brewery WWTP in Lérida to recover
biomethane and feed a fuel cell. The co-digestion of
waste yeast and support for AITASA, in Tarragona,
where Aqualia has built a new industrial effluent
treatment system that could later be used to supply
the petrochemical centre is also under study.

This fully funded project is part of the RIA
(research and innovation action) Horizon Europe
programme. The consortium is led by the CETIM
technology centre and comprises 20 partners
from 11 countries covering the EU geography
and has international cooperation from Turkey
and Pakistan. The project envisages a circularity
model in industrial water consumption with a
broad perspective: efficient technologies for water
circularity, energy and raw material recovery, in
order to contribute to climate neutrality, circularity
and competitiveness in the EU.

178

Four case studies will be developed including three
industrial sectors (pulp and paper, chemicals and
steel), as well a fourth case to explore synergies
between urban and industrial wastewater
treatment. Digital tools will also be developed and
applied for optimum water treatment technology
configuration and daily operation, making the most
of flexibility opportunities in smart networks.

5.6.
Digital developments

HE Rewaise

In addition to the reuse, sustainable desalination
and purification actions mentioned, this project is
cross-cutting and includes digital management
solutions studied in Aqualia’s “living laboratories”
in Asturias, Badajoz, Canary Islands, Dénia,
Salamanca and Vigo, in Spain. To improve process
operation and control, work is underway to
simulate networks and plants, optimising service
efficiency and water quality.

MRU Aquatim

The CETIM technology centre, Aqualia and its
subsidiary Trainasa make up this Mixed Research
Unit (MRU). The goal is to respond to current
challenges by studying and implementing new
technologies throughout the end-to-end water
cycle. Innovation, development of new circular
economy models and digitalisation are key factors
for obtaining new green energy sources (hydrogen
and biogas), new natural resources and their
efficient use (nutrients, metals and water). The
protection of ecosystems and biodiversity is also
included with nature-based solution (NBS), the
development of new digital technologies (sensors,
traceability, models and predictive systems) and
the introduction of improvement actions to ensure
quality in water masses.

HE D4Runoff

The project is led by the public water company
Vand Center Syd (VCS) in Odense (Denmark), it
brings together 12 partners from five countries,
including Aqualia and its subsidiary Hidrotec,
the Technological Institute of Galicia (ITG), the
University of Cantabria, and the Catalan SME
Mitiga specialised in risk control software. Tools
are developed to quantify, avoid and manage
diffuse pollution caused by urban run-off water.

The work programme includes the development
of new analytical methodologies with Aqualia
laboratories (Hidrotec), the online measurement of
micropollutant and bioplastic indicators, and the
implementation of preventive strategies to reduce
diffuse pollution with multi-criteria analysis and
artificial intelligence. Nature-based management
solutions (NBS) will be validated in Odense
(Denmark), Pontedera (Italy) and Santander and
their replicability assessed in Algeciras, Ostrava
(Czech Republic) and Cairo (Egypt).

HE Ninfa

The project develops systems to monitor
and protect groundwater, starting with the
measurement, modelling and treatment of various
pollutants (nutrients, pesticides, pharmaceuticals,
hydrocarbons, heavy metals, microplastics and
salinity). The pollution prevention and groundwater
management strategy is based on early detection
systems, a better understanding of synergistic
effects and control of risks of multiple disturbance
factors. These elements are combined with
predictive methodologies to increase resilience and
implement treatment and mitigation solutions.

179

The project is coordinated by the Leitat technology
centre, and brings together nine partners from six
countries. Aqualia participates with its laboratories
(Hidrotec) and implements activities along with
another partner, Los Alcázares Town Council
(Murcia). A partnership is also planned between
Aqualia France and the Institutes Mines-Télécom
Atlantique in Brittany (Brest, Rennes, Nantes).

Representatives of the NINFA project research consortium present progress in Los Alcázares, Murcia (Spain).

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5.7.
Patents

Status of patents in 2023

Type of protection

Short name

The 10 families of patents and brands were
maintained in 2023. They continue to grow since
2014 and two Aqualia Industrial patents are still
valid, summarised in the following list.

National patent SPTO (Spanish
Patent and Trademark Office)

Water delivery and filter flushing system

Concession date

Concession no.

08/02/2005

ES2196949

Anaerobic batch water treatment system

06/05/2009

ES2300164

Carbonatation system

18/11/2015

ES2451579

EPO European Patent

Carbonatation system

SPTO national patent
EPO European patent
Trademark
EPO European patent

EPO European patent
Trademark

EPO European Patent

ELAN Anammox process
ELAN ®
ELAN ®UK
ARON ®
AQU-ELAN (ELAN in water line)

Algae-optimised LEAR
(LEAR)
LEAR ®

Fluidized bed reactor CMBs
FBBR (ELSAR)
ELSAR ®

Influent distribution and Mixing Device for UASB Reactors PUSH
Combined USAB Reactor-solids Anaerobic Digester Device and Method for
Treating Unsettled Sewage Mejora PUSH

EPO European patent
PCT international patent
Trademark

Biogas upgrading
Biogas upgrading USA and MEXICO
ABAD Bioenergy ®

EPO European patent
PCT international patent

EPO European patent
Trademark

MDC (Microbial Desalination Cells MIDES)
MDC USA

SAnMBR
SAnMBR USA and MEXICO

ADVANSIST
ANPHORA®
ADVANSIST/ ANPHORA®COLOMBIA

EPO European Patent

DARE

18/11/2015

10/09/2014
17/12/2014
03/09/2014
30/08/2023

06/01/2016
03/09/2014

22/04/2020
02/06/2021

05/10/2016
15/11/2023

29/03/2017
27/02/2018
02/12/2021
22/05/2017

26/08/2020
23/03/2021

20/05/2020
03/03/2020

10/07/2020
02/06/2021
27/03/2019

19/05/2021

EP2712917

ES2466090
EP2740713
11256559
UK00911256559
12785771
EP3255016

EP2875724
12785713

EP2927196
18398327

EP3009408
EP4166514

EP3061515
US9,901,864 B2
388417
016146151

EP3336064
US10,954,145

EP3225596
US10,577,266 B2

EP3546562
18398329
41631

EP3527538

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Three new protections were requested in 2023: a
patent and two trademarks for the DAHLIA® and
CAMELLIA processes. Of the six patent requests
submitted in previous years, two are in the final
concession phase (AquaElan and Estruvita). We
are still waiting for news on the other four in the
patents pending table:

Status of new patents requested

Type of protection

Short name

Application date

Application No.

Result

EPO European Patent

AQUELAN (ELAN in water line)

10/06/2016

EP16382266.1

Concession announced

EPO European Patent

Struvite crystallisation

26/09/2016

EP15754933.8

Concession announced

EPO European Patent

Pressurised reactor

19/10/2017

EP17382699.1

Under assessment

EPO European Patent

Purasand High Recovery

30/09/2022

EP22382912.8

Under assessment

EPO European Patent

WETFAN

28/11/2022

EP22383139.7

Under assessment

EPO European Patent

Ectoine production

03/03/2023

EP23382198.2

Under assessment

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation
1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

End-to-end Water Cycle Management | People and culture | Page 1 of 8

182

6. People and culture

6.2.
Conciliation

6.1.
General action lines

After developing the People and Culture
department’s activity regarding the Be Aqualia
project, our different roles converge under a
common approach and slogan: people working for
people.

Be Aqualia is the company's cultural
transformation project through coherent and

consistent intervention from human resources.
This intervention is in accordance with the
company's Strategic Plan and business vision and
is supported by people management led by the
company's directors.

During this year, and keeping the key objective
of becoming a healthy organisation, work has
continued on the basis of the seven blocks of
action identified as "health assets" that constitute
the different lines of work to be detailed later in the
different sections.

Aqualia keeps its efr (family responsible company)
certification obtained in 2017 and renewed until
2023. Aqualia increased its score since initial
certification, having been upgraded from a C to a
C+ company.

In 2023, the Employee Voice Survey was
conducted to analyse the Efficiency of Be Aqualia
Measures.

Results indicate that the most valued measures
are related with flexible working hours and health.
The main suggestions received are related with
flexible spaces.

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183

Moreover in 2023, Aqualia made its commitment
to diversity visible in different forums like
participating in the Parliamentary Round Table on:
“Diversity, Inclusion and Sustainability, challenges
for business and Spain as a society”, held
on 2 June.

With the Adecco Foundation, Aqualia continues
to develop the Family Plan aimed at children of
employees with a certified disability greater than
or equal to 33%. It also maintains the collaboration
agreement with the Down Syndrome Foundation
and with FSC Inserta of ONCE.

Equality

Empowering Women’s Talent (EWT)

Due to its commitment to promoting female talent
and diversity, Aqualia has renewed the Empowering
Women’s Talent seal from Equipos&Talento, a
magazine specialising in Human Resources.

6.3.
Diversity and equality

Diversity and inclusion Social

In 2023, Aqualia renewed its participation in the
Diversity Charter where the company declares
that it respects regulations in force on equal
opportunities and non-discrimination.

Membership of the #CEOPorLaDiversidad alliance
is maintained, an initiative led by the Adecco
Foundation and CEOE Foundation (Spanish
Federation of Business Organisations) to unite
companies and their leaders in the values of
diversity, equality and inclusion.

Equipos y Talento magazine, a reference in Human
Resources, has recognised Aqualia as one of the
70 leading companies in diversity, renewing its
Diversity Leading Company seal with 600 points,
exceeding last year’s score (556).

Aqualia has set up a Diversity Committee to
analyse diversity-related matters and projects. The
first Diversity, Equality and Inclusion Protocol was
approved in 2023, which will allow us to continue
advancing in the implementation of an inclusive
and bias-free culture.

With an agreement signed with FELGTBI+, Aqualia
has joined the EMIDIS programme in 2023 to run
a diagnosis on LGTBI diversity. The initial result of
46.30 points was positive, far above the average
of 30 points obtained by companies beginning to
implement these policies.

In 2023, Aqualia maintained its agreement with
the Asociación Red Empresarial por la Diversidad
e Inclusión LGBTI (REDI), an ecosystem of
companies and professionals in Spain that works
to promote safe and respectful work environments
for all people, regardless of their identity, gender
expression or sexual orientation. Awareness-
raising sessions for the workforce have been held
with REDI.

Aqualia also celebrated Diversity Week,
participating in different activities to raise
awareness and support the LGTBI+ community.

Aqualia has an agreement with MyGWork:, a global
recruiting and networking platform for LGTBI
professionals, graduates, allies and organisations
to promote diversity and inclusion in the workplace.
A tool to attract diverse talent at Aqualia.

‘Empowering Women’s Talent’ seal presentation ceremony.

Continuity of the “Aqualiawomen”
Internal Female Talent Network

Aquamaior receives the Equal Pay Seal
2023

Executive Development Programme for
Women

To promote networking, access to training and
coaching. Fifty women currently belong to this
network. 83.4% of participants value the activities
developed as part of the initiative in its first year as
positive.

Aquamaior, the Aqualia subsidiary managing the
end-to-end water cycle in the Portuguese town
of Campo Maior, has received the award from
the Portuguese Commission for Equality in Work
and Employment (CITE) for its best practices in
promoting equal pay among women and men.

Cross Mentoring programme, part of
Empowering Women’s Talent (EWT)

Let's talk about Equality training

Different companies participate and pairs of
mentor and mentee are created. This programme
brings the richness of diversity of sectors
and business models. Three mentees and
three mentors from Aqualia have taken part in
programme in 2023, which will continue in 2024.

The goal is to promote equal opportunities in
the workplace, not tolerating direct or indirect
discrimination based on gender, race, age,
nationality, religion, sexual orientation, disability,
etc. This course has been included in the initial
training for new hires.

Campaigns Women's Day, Elimination of
Gender Violence, etc.

The company continues to show its commitment
against gender violence by launching and
participating in different awareness raising
campaigns carried out in different municipalities
and with the collaboration of Aqualia's staff.

Equality Distinction

In 2023, Aqualia received an extension of its
“Equality in Business (DIE)” distinction for another
five years. The Ministry of Equality has recognised
Aqualia’s efforts in equality by renewing this
distinction, granted by the public body in 2010.

Equality Plan

In 2023, Aqualia has implemented the
commitments taken on in the Third Equality Plan
for the period 2021-2025, which was signed on
5 October 2021, thereby renewing its commitment
to guaranteeing equality between sexes (SDG 5)
and the reduction of inequalities (SDG 10).

184

to overcoming barriers for these women when
attending employment workshops due to their
scarce economic resources and lack of family
support.

Participation in the Gender Violence and
Employment Report to position employment as
a key element in the recovery of female victims.

In 2023, a new edition of the Development
Programme for Management – Women with High
Potential by the School of Industrial Organisation
(EOI) was held, with five members of the Aqualia
workforce participating.

Agreement with Adecco Foundation

Agreement with the Ministry of Equality

For the development of activities aimed at finding
employment for women at risk of social exclusion,
such as:

Employment Camp. Socio-labour integration
project for women in vulnerable situations.
With this initiative, Aqualia aims to contribute

Aqualia maintains the agreement with the Ministry
of Equality (Government Delegation against
Gender Violence) to promote awareness and social
sensitisation against gender violence as part of the
“Companies for a society free of gender violence”
initiative signed in November 2022.

Aqualia ‘Inspiring and real’ equality campaign.

End-to-end Water Cycle Management | People and culture | Page 4 of 8

6.4.
Leadership

Training in the Aqualia Leadership Model
continued in 2023, aimed at managers within the
organisation. The training sessions are based on
three pillars of leadership for Aqualia: participative,
healthy and inclusive.

6.5.
Development

Professional and personal
development

With the aim of contributing towards a
healthy working environment and reducing
conflicts, Aqualia has an Interpersonal Conflict
Management Procedure, which aims to be an
effective tool to manage and resolve conflicts that
arise in the workplace through mediation.

The Standard Position Manual was updated
in 2023. It contains descriptions of jobs within
the organisation according to professional
families. This manual aims to be a basic tool for
organisational human resource processes.

Training at Aqualia is linked to the Company's
strategic objectives, to improving the performance
of workers' roles and to ensuring health and
well-being. Work is being done for this to develop
training adapted to the requirements of each job
within the company.

Worldwide in 2023, 2,146 courses were organised
in all the countries Aqualia operates and the
workforce received 196,546 hours of training.

The language policy has been implemented in
2023, highlighting the multilingual platform
where the following languages can be studied:
English, French, Portuguese, Italian and Spanish.
407 people have used the platform, 81% of whom
have completed training courses/modules.

Language groups and individual classes have also
been organised based on the profiles and scope of
activity of each job. 199 people have taken part in
these training courses, with a 78% completion rate.

Training and awareness in Diversity and Equality
were especially relevant in 2023, highlighting the
following actions:

Awareness and protection course against sexual
violence at the company.

Awareness on DE&I LGBTI. 146 people trained.

Awareness raising in Diversity and Inclusion
for new hires. Workforce with email access
do the course through the FCC Campus and a
campaign is being carried out through posters in
different countries and languages for employees
without access to a computer.

A course on inclusive language has also
been developed with 1,666 participants and
another on unconscious bias, completed by
2,245 people.

Noteworthy commitments in the 3rd Aqualia
Equality Plan include raising awareness on the
Gender Violence Cycle and Support Networks
completed by 2,284 employees online, as well as
a campaign with posters and on the Be Aqualia
app.

884 people also participated in Cyberbullying
training in 2023.

“Cultural transformation for sustainability” training.

Likewise, in 2023 training on the FCC Group Code
of Ethics and Code of Conduct continued for new
hires. In the field of regulatory compliance, the
course on Conflicts of Interest was completed by
1,018 employees.

Given the important of Cybersecurity, different
courses on this subject were held throughout 2023
with 4,365 participants attending.

Training courses on Cultural Transformation
in Sustainability were given to Aqualia's team
managers to highlight the cultural transformation
that the company is undergoing towards
sustainability, as evidenced by the launch of the
2021-2023 Sustainability Strategic Plan. This
training will continue in 2024.

End-to-end Water Cycle Management | People and culture | Page 5 of 8

2,146

courses organised

196,546

hours of
training

Selecting
and attracting talent

Aqualia's Selection and Professional Practices
department works with a single goal: attract talent,
guaranteeing objectivity and equal opportunities in
the personnel selection and recruitment processes
at all times.

Therefore, in 2023, work continued on Aqualia's
Employer Brand image with Employer Branding
programmes that promote the company's main
goal of guaranteeing equal opportunities.

Training related to emotional health is still viewed
as important. Stress management and productivity
courses were organised, as well as workshops of
psychosocial issues and mental well-being, with
612 participants.

Aqualia has also once again invested in the most
relevant job portals with the largest national and
international capacity, maintaining in 2023 its
contract with the myGwork platform to attract
diverse talent to Aqualia.

En 2023, Aqualia was recognised as a "Brain
Protected Space” awarded by the Freno al Ictus
Foundation. This recognition is thanks to the
training offered to employees at the company’s
headquarters in Madrid, Barcelona and Seville to
help them identify, stabilise and effectively respond
to strokes that may occur at company facilities
and while performing their work duties. The “Brain
Protected Spain” certification programme has
trained a total of 358 people.

Aqualia continues to promote and develop
processes for the accreditation of professional
skills. Aqualia currently has 17 authorised experts
(11 for energy and water, six for Safety and the
Environment).

In 2023, 741 selection processes were conducted.

Aqualia also continues to work on attracting young
talent by signing agreements with universities and
vocational training centres in different regions.
New students have been included from the Higher
Level Qualification in Water Management and the
Intermediate Level Qualification in Water Networks
and Treatment Plants of the Dual Vocational
Training course in the Region of Madrid, promoted
by Canal de Isabel II.

6.6.
Quality employment: collective bargaining,
labour relations and personnel administration

For collective bargaining, the trend of reducing
the number of smaller collective bargaining
agreements continued and, by adhering to the
Sector Agreement, the 6th State Agreement for the
End-to-end Water Cycle continued to be extended
as the regulatory reference framework for labour
relations.

Conventional agreements at provincial and regional
level have also been reached, such as the Regional
Collective Bargaining Agreements in Murcia,
Madrid and Catalonia, as well as in the provinces of
Toledo and Alicante, where Aqualia participated in
the negotiating committee.

Concerning relations with social partners, the most
representative trade union organisations (UGT
and CC. OO.) and the companies that represent
the sector at employer level (AGA), there were no
collective conflicts at sector level or strikes in the
Aqualia Group in 2023.

As for equality, Aqualia group companies are
required by legislation to have Equality Plans in
force and agreed at corporate level. Regarding
compliance with regulations regarding personnel
with disability, the Aqualia group fully complies
with these regulations, adhering to the 2% required
for staff with disability in companies with more
than 50 workers, and for FCC Aqualia S.A., through
the corresponding alternative measures.

In quantitative figures, the stability policy is
maintained nationally at the same level of 93% of
permanent contracts in 2023. In terms of gender,
the percentage of female employees has increased
compared to 2022 at national level, reaching 23%
in 2023. At international level, employment stability
stands at 70% for permanent contracts and 30%
for temporary contracts, and in terms of gender, it
stands at 83% men and 17% women. This variation
is due to the notable increase in female employees
at international level compared to 2022.

Labour disputes remained low. In terms of
collective dispute, there were several low-impact
disputes due to applying the collective bargaining
agreement with a mediated solution reached in
most cases. Internationally, there were no relevant
collective labour conflicts. Work Inspections fell
by 30% compared to 2022 with conciliation or a
favourable result in most cases, except one minor
case.

2_
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3_
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End-to-end Water Cycle Management | People and culture | Page 6 of 8

National contracting situation and people by gender

International contracting situation and people by gender

International

Central
Services

Zone 1

Zone 2

Zone 3

40%

30%

20%

10%

100%

80%

60%

40%

20%

3.500

3.000

2.500

2.000

1.500

1.000

500

77%

93%

23%

70%

30%

Saudi
Arabia

Algeria Balkans Czech
Republic

Chile Colombia Direc.
Latin

Egypt

The
Emirates

France Georgia

Italy Mexico Oman (L)

Panama Peru Portugal Qatar Romania Tunisia

International

Central
Services

Zone 1

Zone 2

Zone 3

Saudi
Arabia

Algeria Balkans Czech
Republic

Chile Colombia Direc.
Latin

Egypt

The
Emirates

France Georgia

Italy Mexico Oman (L) Panama Peru Portugal Qatar Romania Tunisia

83%

17%

Female

Male

End-to-end Water Cycle Management | People and culture | Page 7 of 8

188

6.7.
Health and well-being

Accident frequency rate
evolution at Aqualia in 2023

In 2023, the goal to reduce the accident rate
was achieved. The AFR stands at around 7.79(1)
compared to 9.84 in December of the previous year
or 10.12 in October 2022.

That no serious accidents with company
employees have occurred is noteworthy.

Accident frequency rate evolution at Aqualia in 2023

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Reported Empl&Cont

Reported previous year

YTD rolling average

Last 12 months rolling average

AFR YTD

AFR last 12 months

(1) Consolidated data to October 2023 and averaged for November and December.

Highlights for health and
well-being

The Strategic Plan for Health and Well-being was
redesigned in 2023 in line with the company’s
Strategic Plan, translating it into actions to be
developed by 2026.

We have worked on implementing some of these
actions under the five lines of work in the Strategic
Plan for Health and Well-being that represent
progress in the effective and efficient management
and continuous improvement not other of safety,
but of health and well-being at the company:
for the workforce and their family and social
environment.

The most significant actions this year were:

Specialised in-person training on contractor
management and using documentation control
and tracking platforms.

3rd Aqualia International Seminar on Health and
Safety.

Projects or initiatives aimed at controlling critical
risks at Aqualia:

Update and presentation of the asbestos work
plan for approval.

Control visits and improvement plan as part
of the comprehensive ATEX risk installation
control campaign.

Control visits and improvement plan as part
of the comprehensive chloring gas installation
control campaign.

Outstanding projects or initiatives aimed at
achieving “Zero Harm” to employees:

Projects or initiatives aimed at improving people's
well-being:

The Action Plan against Accidents at Aqualia
was designed and disseminated, adapting it to
each department.

Indicators were defined and designed to identify
recurrences associated with accidents and for
the segregated analysis of accidents by age,
gender and other variables of interest.

Resources were generated for awareness,
learning and training with gamification and new
technologies.

Use of the Be Aqualia app as a communication
tool was encouraged.

Consolidation of the Be Aqualia and healthy
organisation project with various cross-cutting
and specific initiatives focused on comprehensive
health improvement for the workforce.

Cross-cutting actions:

Physical activity (Women’s race or completion of
the United Heroes pilot).

Diet (Be Aqualia strategy against excess weight
and obesity, Befit with training routes, monthly
menus, guided challenges,
and integration through health monitoring,
webinars, workshops and various talks on eating
habits and their influence on health).

189

Local agreements with physiotherapy clinics as
well as encouraging taking breaks at the office
and physical activity to start the day.

The emotional health and psychosocial risk
management programmes at the company are
worthy of special mention. Once again, multiple
interventions were held with our partner Affor
Health, reinforcing a cultural change at the
organisation when addressing mental health by:

Some actions to promote health in 2023 were:

Certification of corporate centres as Brain
Protected Spaces through the Freno al Ictus
Foundation. Talk on prevention and acting in
case of a stroke.

Participation in Caring for the Voice for
telephone operators (CAC).

Flu Campaign covering approximately
700 employees.

Aqualia ‘Be fit’ workshop.

Talk on the Prevention of Cervical Cancer.

Talk on the Be Aqualia and El Endrinal healthy
eating on site: personal nutrition with high
energy demand.

Intensification of the strategy against excess
weight through the Fit Week with a webinar, bike
blender activity and Be Aqualia packs, various
initiatives to promote healthy breakfasts.

Local initiatives:

Organisation, promotion and, in some cases,
sponsoring of sporting activities such as races,
hiking, padel tennis, football matches and yoga
to improve the posture.

Distribution of fruit, recipe competition and
health breakfasts.

Family day.

Taking part as a co-founding company
and promoter behind a new psychosocial
assessment tool, Mentally Pro, in collaboration
with the University of Barcelona, Affor Health
and many public and private, national and
international entities.

Participating as a speaker at the Prevention
and Addressing Suicide in the Workplace
Seminar at the Psychology Association of
Madrid (April 2023).

Employee Assistance Portal (PAE) using
Psicomet as a tool for psychosocial diagnosis
and monitoring.

Training on management and individual
coping techniques and tools to improve our
psychoemotional health with free workshops
and webinars for employees, for example, a
workshop in emotional first aid.

Action plans taken from the Work Climate
Survey.

Extended MRI analysis with PSA dosage is
maintained in men over 50.

Julio Agredano, chairman of the Freno al Ictus Foundation,
presents the certificate to Félix Parra, Aqualia CEO.

Asepeyo Back Schools.

As part of our health monitoring, 6,809 medical
check-up were conducted in Spain during 2023
(5,896 through Cualtis and 913 at SMFCC).

Department optimisation

Training in specific duties of appointed
technicians.

Working group to improve efficiency and fluidity
in the work of the H&W department (SUMA).

Design, development and implement of new
Health and Well-being software in Phase
I regarding injuries stemming from work,
inspections and actions.

Awards and recognitions received
in health and safety

Our Aqualia Mace project in the United
Arab Emirates was recognised for its HSE
performance with the HSE Toward the Future
2023 Award.

In Oman, the OSWS project also received the
following awards in 2023: British Safety Council
Safety International Silver Award and ROSPA
International Safety Award.

Second prize at the 5th VIVE Health FCC Group
Awards. Category: Promoting Health. Emotional
Well-being at Aqualia: “COVID-19 Challenge”.

Additionally, Aqualia’s noteworthy participation in:

PRL Innovación in various lines of work and at
the 6th PRL Innovación Congress.

Psychology Association of Madrid to address
and prevent suicide in the workplace.

Nalanda SMART HSE.

7. Corporate Communication and Sustainability

190

Once again, one of the main milestones for the
Corporate Communication and Sustainability
department was the 7th Aqualia Journalism Award
ceremony, held on 7 June at the Madrid Press
Association (APM) headquarters. This award saw
41 journalists from Spain and Colombia presenting
a total of 60 journalism pieces highlighting the
importance of managing the end-to-end water
cycle and to increase awareness of water as a

valuable and scarce resource. The Award panel
granted the prize to a report by Canal Sur TV on
water management against climate change by the
“Tierra y Mar” and “Espacio Protegido” programme
team, directed by José María Montero and
presented by Ángela Blanco. Two second prizes
and two special mentions were also awarded. A
total of 340 pieces have been submitted to the
seven edition of the Award.

7.1.
Communication

Aqualia's Communication Plan:
national and international

The water sector is facing major challenges that
put Aqualia in a position of great responsibility with
the environment, population and their future. As
an essential public service provider, the company
has the capacity to resolve problems in territories
according to environmental, social and governance
criteria (ESG), thus building its social legitimacy.

In this context, the Aqualia 2023 Communication
Plan (PCOM) includes stakeholder expectations
for the company’s activity and it sets the strategic
lines of the company for each of its audiences.
PCOM sets the course for the department’s work
with the core communication: “Sustainability
through digitalisation, focusing on efficient
management”.

The Plan includes general action lines for the
company in communication from a strategic
perspective and their adaptation to each moment
and territory and to the triple ESG sustainability:

Achieve a leading company position with
capacity to influence the end-to-end water cycle
management sector, obtaining a social licence.
This objective links with economic sustainability
and affects SDG 17: Strategic alliances.

Transfer the real value the company provides
to municipalities with water cycle management
(affects environmental sustainability SDG 6:
Water and sanitation).

Highlight the company’s digital transformation,
technological evolution and capacity
for adaptation to climate change while
raising awareness on sustainability. Social
sustainability affects SDG 12: Responsible
production and consumption.

2023 was marked by various special cases, such
as local elections in Spain, the PERTE plans
or regulatory demands in sustainability and
transparency in the sector, as well as Aqualia’s own
circumstances like entering Georgia and expansion
in Colombia and France.

In 2022, 2,012 press releases were sent to the
media and 426 meetings were held with media
outlets of all kinds.

A report directed by José María Montero and presented by Ángela Blanco,
by Canal Sur Televisión, wins the 7th Aqualia Journalism Award.

191

Digital communication
and social media

In 2023, the Aqualia website reached
706,000 visits by 698,000 users, with a rebound
rate (users abandoning the site after viewing one
page) of 31.3%.

A section on Responsible use of water
(aqualia.com) was created on the website so that
councils can use the responsible use of water
campaigns. The new space has two sections:
“Water Sanitation” and “Responsible Consumption”
where public authorities can find communication
tools to raise public awareness on responsible
consumption (posters, videos, radio ads, digital
tools, bottles, backpacks and stickers, etc.).

Moreover, access to the Public Information
Portal search engine has also been created on
the Aqualia website so users can search for their
town with a direct link to their local municipal
water service portal. Over this last year we
have progressed in the plan to migrate “Public
information” portals. This plan was devised as a
result of the transposition of Directive 2020/2084
in Spain, which affects the quality of water
intended for human consumption. The new
requirements include guaranteeing availability
of updated information. Local web portals are
changing to a new format to comply with the
regulation and are accessible from both aqualia.
com and from the websites of Spanish councils.
By the end of 2023, 200 portals had been
published. The phases pending completion are
phase 6, with 50 portals under review (pending the
receipt of content from the Technical department)
and phase 7, with 60 portals in “contribution” (also
pending the Technical department).

Communication Training

The course “Training for Aqualia Spokespersons:
Influence and Persuasion Development” Was
included in the Aqualia Training catalogue for
the second consecutive year in 2023. The goal
of this action is to train executives and middle
management in how to be spokespersons for the
company to persuasively convey messages to our
different stakeholders.

Three course sessions were held: in Madrid, on
18 and 19 October; in Seville, on 7 and 8 November;
and in Barcelona, on 15 and 16 November. A
total of 28 company professionals participated
in the training, including delegation managers,
heads of management units, heads of services
and managers of large contracts in Spain. The
number of attendees was reduced compared to
the previous year (45) to increase customisation
and opportunities for employees to take part as the
training programme is theoretical and practical.

The course was offered by Ask Consultores and
coordinated by the department. Satisfaction
surveys resulted in a “general satisfaction with
the course” of 4, 3.78 and 4 in each of the three
sessions. The training is expected to return
in 2024.

One of Aqualia’s biggest milestones in 2022
was receiving a corporate green syndicated
loan of 1.1 billion euros from ten banks, led by
CaixaBank. This also had its repercussions in 2023
as the company received two recognitions: the
“Sustainable loan of the year award 2023” granted
by OFISO and the “Impact project/investment of
the year 2023”, from the Environmental Finance
journal in December. However, the award with
most press coverage at national and international
level was the ‘Water Company of the year 2022’
given to Aqualia by the Global Water Intelligence
information platform.

The year began with the publication of an
interview with Félix Parra, Aqualia CEO in the
February edition of Agua y Medioambiente
magazine, published in print and digital format by
El Economista. The economic journal interviewed
Félix Parra as chairman of the StepByWater
Alliance and asked questions such as the
challenges of the water crisis in Spain, investments
needed in the urban water cycle, generation of
renewable energies in the treatment process and
increased energy and Spanish water market costs.

Another important milestone this year were the
calls of the PERTE for digitalisation of the water
cycle. In the first call, resolved in the second half
of the year, Aqualia submitted seven projects
including, of which the Ministry for Ecological
Transition and the Demographic Challenge
(MITERD) finally selected one: the Campo de
Gibraltar PERTE. The Corporate Communication
and Sustainability department announced this
milestone to the press in a press release that was
covered in national, sector and, especially, local
outlets.

Responsible water consumption portal.

192

Another space on the Aqualia website is dedicated
to the Sustainability Report. This year, the 2022
Sustainability Report, available in Spanish,
English, French and Portuguese, includes two new
developments. A fifth format has been adapted:
“The report at a glance”, a shortened version
with the most essential details. The second was
the publication of nine interviews with Aqualia
Management Committee executives, each heading
a chapter of the Report.

The website section on the SDGs was also updated
to mark the 8th anniversary of the SDGs. In 2023,
the United Nations focused on SDG 8, which aims
to achieve sustained, inclusive and sustainable
growth. The Aqualia web space centred on
conveying the company’s eight real commitments
to progressing in achieving SDG 8: diversity, work-
life balance, quality training, physical health, safety,
emotional health, promoting local employment
and regulatory compliance, each told by an Aqualia
manager in that area.

In 2023, the website also updated the spaces
aqualiacontigo.com (for the campaign
against gender violence on 25 November) and
aqualiaigualdad.com (with the International
Women’s Day campaign on 8 March).

Aqualia has continued to promote the
aqualiaeduca.com website as part of its
commitment to education and achieving the
SDGs. The portal is a free educational tool where
children and adults can learn about the water cycle
and the importance of its proper management
with resources such as videos, comics, puzzles
or educational leaflets. The website received
10,017 visits in 2023. Since the web was launched
in 2018, it has recorded 62,221 sessions.

Aqualia's social media has maintained its growth
in 2023 compared to the previous year, both for the
number of followers and posts.

On YouTube, the company has 3,600 subscribers
and 2,344,152 views (around 300,000 new views
this year).

On X (formerly Twitter), it has added over 500
new followers this year, currently up to 7,618.

On LinkedIn, Aqualia followers have risen from
37,854 last year to 49,510 this year, an increase
of over 30%.

Aqualia’s Instagram profile, which launched
in March 2022, already has 2,270 followers
(1,170 more than last year).

The company’s social media profiles continue to
play an important role for information/training in
company initiatives, such as the gender violence
campaign, World Environment Day or promoting
the “Sosteniblómetro”. The User Manual and
Employee Participation on Social Media, published
in 2022, is still valid as a guide for all Aqualia
personnel to know how to use their social media
profiles correctly.

Internal communication

Internal communication continues to gain
relevance in everyday life at Aqualia as a way of
keeping all company employees informed of its
activity, positioning and other relevant events, and
as an element for internal cohesion and conveying
our culture. Work continues to adapt messages
to different groups of employees (office workers
and deskless or field workers who do not have
corporate email).

In 2023, a total of 1,017 internal communications
were sent in different formats: email, informative
flash, “Aqualia Global News” newsletter and
corporate app.

A total of 13 informative flashes were sent,
significantly lower than previous years to avoid
saturation. So the flashes were reserved almost
exclusively to inform of new contracts or matters
of maximum interest for the company as a whole.

Award winners at the second edition of the Aqualia “i4U” Innovation Awards.

Greater informative weight has been transferred to
the “Aqualia Global News” newsletter launched in
late 2022. A newsletter is sent every fortnight with
15 news/information items available in Spanish
and English. There has been a progressive increase
in interest for this channel among the workforce
with the click rate evolving from 49% to 65% in
some cases sent in late 2023. The newsletter is
sent by email and the Be Aqualia app for deskless
employees.

A new, “Personal” section was introduced in 2023:
interviews with different company profiles to
show the diversity of our internal talent. To mark
the first anniversary of the newsletter, a special
issue was launched in November with an interview
with Juan Pablo Merino, Director of Corporate
Communication and Sustainability, and video of
employees celebrating this milestone.

193

Work also continued in coordination with the
People and Culture department to set up the
Employee Assistance Programme (PAE), launched
in December 2019. Communication pieces, talks
to learn how think more healthily and emotional
health workshops, etc. were organised. All were
available for subsequent download.

Internal Communication channels were also used
to disseminate the New edition of the FCC Group
Code of Ethics and Code of Conduct throughout
the company and adapted to all languages.
Compliance Tips were once again sent in 2023.
As a new feature, compliance officers sent video
messages translated into seven languages on
aspects of regulatory compliance.

Internal communication tools were also used
to send, segmented by country and group, the
Materiality Survey, as well as other information
of interest, like the Aqualia catalogue of work-life
balance measures (efr) or the Corporate Visual
Identity Manual. Finally, information has been
disseminated at certain time, such as actions
designed for LGTBI Week, the Aqualia Women
Network, Freno al Ictus training and certifications
or the Photography Competition for children,
nieces, nephews, grandchildren, which was also
segmented by language to increase international
participation. Support was given to campaign with
which Aqualia normally aligns.

In terms of internal events, the 2nd I4U Innovation
Awards, an initiative launched in 2021 to promote
the development of internal talent and an innovative
culture within the company. This edition increased
international participation and 33 candidates were
submitted by professionals from four countries
(Colombia, Italy, Czech Republic and Spain) seeking
to improve the quality, efficiency and sustainability
of water cycle operations. The awards were present
in October at the Aqualia corporate headquarters in
Las Tablas (Madrid) and broadcast via streaming
with Microsoft Teams. The team formed by
Lubomir Vyvial and Pavlína Myšáková from SmVaK
(subsidiary in the Czech Republic) won this second
edition. Two second prizes and an Employee
second prize were also presented. The event was
communicated internally with an informative flash
and the newsletter; and externally via social media
and a press release.

In April, for Safety Week, several actions were
organised in coordination with the Health and
Well-being department. The communication of the
different activities was done in segmented fashion,
so that the teams received information on the
activities undertaken in their local areas. We also
differentiated between deskless employees and
employees with email, apart from some common
communications on talks, videos of active breaks
and health and safety recommendations.

During this year, the Befit Campaign was also
developed in coordination with the Health and
Well-being team: activities, informative talks,
webinars, material, informative clips, etc., focused
on promoting healthy habits among employees.
These were sent to professional by email and
notifications on the Be Aqualia app.

End-to-end Water Cycle Management | Corporate Communication and Sustainability | Page 5 of 12

Events

National events

Aqualia continues to take part in various leading
sector events and congresses, both national
and international. This event schedule began in
January with the 2nd StepByWater Meeting, held
at the headquarters of the Spanish Federation of
Municipalities and Provinces (FEMP) in Madrid.
The conference, entitled “Drought in Europe” was
supported by the Government of Spain with the
participation of various authorities. Félix Parra,
Aqualia CEO, opened the event. StepByWater
is a pioneering multisector alliance in Europe
and Spain. It promotes in an integrated, cross-
cutting way as part of an alliance framework, key
supranational initiatives such as the 2030 Agenda,
the Action for Water Decade, Agreements of the
different Climate Summits and Urban agendas.
Aqualia is an agent for the “Cultural Revolution of
Water” and Félix Parra is chairman of the alliance.
Another meeting was held in September with the
participation of Aqualia to present “In our hands”
at the Calzada de Oropesa lake (Toledo). The
action, created by international artist SAYPE, rose
awareness on the importance of protecting water.

The company also took part in SMAGUA 2023,
held in Zaragoza in March, presenting the PERTE
initiative for the digitalisation of urban water.
José Gabriel Lumbreras, Director of Operations
and Technological Transformation, presented
the project developed in collaboration with
130 councils. That same month, the company
also participated in the 2nd Economic Forum of
Castilla‑La Mancha. Achievement and Challenges,
organised by El Español, Invertia and El Digital

in Toledo (Spain). Santiago Lafuente, Director of
Aqualia Spain, and Francisco Jiménez, Director of
Aqualia Industrial, participated by analysing the
region’s challenges in water use.

Aqualia was also at the Quality Water Summit,
an event organised by the iAgua portal from 24 to
28 April to analyse the main sector trends. Aqualia
was one of the key agents and took part in different
meeting points: a round table on the future of water
management, a session on the energy transition
in the water cycle and a session on biofactories
and reuse. Zouhayr Arbib, head of Sustainability at
the R&D department moderated a round table on
wastewater treatment in small and medium towns.
Country managers Javier Serra (Egypt) and Javier
Díaz (Saudi Arabia) led round tables on business
possibilities.

In June, Granada (Spain) hosted the 13th AEDYR
International Congress (Spanish Association
of Desalination and Reuse), a forum presenting
the latest research and developments in water
desalination, reuse and treatment. Highlights
of the programme were six presentations by
technicians from the company’s Engineering and
R&D teams. Furthermore, Lyvia Mendes, Aqualia
researcher, won the AEDYR prize for the most
voted presentation.

Also in Spain, Aqualia took part in events such as
the Spain Smart Water Summit 2023, organised
by iAgua from 19 to 21 September. The event
gathered 250 experts to analyse the implications
of the digital transformation in the water industry.
One of the presentations was by Marcelino
Ortega, Process Control Engineer at Aqualia, who
focused on data management and environmental

Second StepbyWater Alliance Conference.

impact. Renzo Lovón, Head of Operation
Applications & Data Analytics at Aquala also gave
a presentation entitled “Transforming cities with
data: technologies and case studies from leading
operators”.

The company took part in the IDA Water and
Climate Change Summit, held in Seville from
15 to 18 October Organised by the International
Desalination Association and backed by MITERD,
the congress focused on the climate emergency
and reuse solutions. Aqualia took part in the
seminar on challenges for achieving carbon
neutrality through innovation.

In November, Aqualia participated in the Digital
Water Summit organised by the International Water
Association (IWA) in Bilbao, with collaboration from

the Aguas de Bilbao Bizkaia Consortium and AEAS,
to speak about digitalisation in the water sector
and with over 400 international experts attending.
Diego Naranjo, head of Efficiency Models and
Smart Solutions, gave presentation on efficient
network management, the Aqualia platform and
its operational control centres. Pedro Rodriguez,
Director of Operations and Technology, closed the
event as vice-chairman of AEAS, representing the
IWA in Spain.

Other events involving the company included the
5th “Andalusia Investors Day” Forum organised in
Seville by El Confidencial; the 5th Ibero-American
Engineering and Technology Congress, CIBITEC23,
in Madrid on 24 and 25 April; and Iberaqua, the
first Industry and Water Congress organised by
Tecnoaqua in Madrid, on 30 November.

195

International events

One of the biggest international events of the year
took place in May, the Global Water Summit, held
in Berlin and analysing the key challenges facing
the water sector today. Aqualia collaborated in
various presentation showcasing its success
stories. Guillermo Moya, Director Europe, and José
Enrique Bofill, Director MENA-Asia, took part in
the Water leadership panel and the round table on
The future of SDG5 finance respectively. These
sessions discussed strategic issues and global
sustainable water management with CEOs and
top-level profiles.

The first of two major events in France where
Aqualia was present was the trade fair Carrefour
des gestions locales de l’eau, held in Rennes on

25 and 26 January. Essential for public bodies,
water management entities and technology
providers from North-east France, this year the
event celebrated its 24th edition with 500 exhibitors
and over one hundred conferences and workshops.

Also in France, in this case to close the year, was
the Salón des Maires et des Collectivités Locales,
held in Paris in December and backed by the AMF
(French Association of Mayors).

At the end of the year Aqualia also attended the
4th Silk Road Forum in Tbilisi (Georgia), held in the
Georgian capital in November under the slogan
“Today connected, tomorrow resilient”. Around
2,000 participants from over 60 countries discussed
regional and global trade and connectivity. José
Enrique Bofill, Regional Director MENA and Asia

at Aqualia, took part in the round table “Promoting
investments with political decisions”.

In America, the 25th ANDESCO Congress took
place in Cartagena de Indias (Colombia) in June.
Aqualia participated in a debate on the public
service model Colombia needs for the future.
More than 3.000 people witnessed presentations
by Juan Pablo Merino, Director of Corporate
Communication and Sustainability, and Yolanda
Barahona, head of Corporate Sustainability.
“Sustainable Natives: the essence of management
in the End-to-end Water Cycle”.

In November, the 35th ANEAS Annual Convention
and Expo (National Association of Water and
Sanitation Entities of Mexico) was held in
Monterrey, with over 8,000 attendees. Aqualia took

part as a collaborator with Country Manager Juan
Miguel Martínez and Production Director Humberto
Morales. Samuel García, expert in water project
management, also gave a lecture on “Water and
future: the challenge in Nuevo León”.

In the Middle East, the company took part in events
such as the Oman Energy and Water Exhibition
and Conference (OEWEC) in March, through its
subsidiary in Oman, OSWS, and with partner
and client Majis. In November, the joint venture
formed by Aqualia and GS Inima, operating the
Mostaganem and Cap Djinet desalination plants
in Algeria since 2011, was invited as a leader in
desalination to Algerian Desalination Day held
in Algiers, a meeting point for the country's main
agents in desalination and to present the latest
developments in reducing energy consumption.

4th Silk Road Forum in Tbilisi (Georgia).

25th Andesco Congress held in Cartagena de Indias (Colombia).

Aqualia receives the ‘Water Company of the Year 2022’ award at the Global Water Awards 2023.

Awards and recognition

Cairo (Egypt) was also a finalist in the ‘Wastewater
Treatment Plant of the Year’ category.

The big recognition received by Aqualia in 2023
was at the Global Water Summit in Berlin in May.
The Global Water Awards 2023 were presented
by British communication platform Global Water
Intelligence. Aqualia won the Water Company
of the Year 2022 award. The panel particularly
valued the company’s financial, commercial
and sustainability achievement in 2022, such
as obtaining the green loan of 1.1 billion euros,
its integrated energy efficiency and emissions
reduction plan or the renewal of almost all its
concession in Spain, along with new contracts in
Georgia, France, Colombia or Saudi Arabia. The
Abu Rawash plant project executed by Aqualia in

Recognitions obtained by the company in 2023
are intrinsically linked to sustainability. The green
loan granted to Aqualia for 1.1 billion euros in 2022
led to the company receiving two awards. One, the
“Best sustainable loan of 2022”, granted by OFISO
(Spanish Sustainable Financing Observatory) in
May, recognising the commitment of institutions
and individuals to promoting financial resources
for sustainable activities. Isidoro Marbán, CFO,
collected the award. The loan was also the reason
for the “Impact project/investment of the year
2023” award granted by Environmental Finance
journal in December, highlighting “the diverse and
large-scale geographic impact" of the investment.

More closely linked to the Corporate
Communication and Sustainability department
was being a finalist at the Ramón del
Corral Dircom Awards. The Association of
Communication Directors, Dircom, included the
Aqualia 2021 Sustainability Report (“#Actúa”)
among the finalists at the 6th edition of the awards,
which recognise excellence and best practices in
corporate communication in Spain. The document
competed in the “Non-financial information”
category of ESG.

Another two local recognitions related to
sustainability came from the Federation of
Business Owners of Cádiz (CEC) at its 3rd
Recognition of Business Commitment to the
Sustainable Development Goals (SDG).

196

Aqualia was worthy of the prize for its
“Sosteniblómetro” initiative, a public barometer
for sustainable conducts. And also an award at
the 27th edition of the Andalusian Environment
Awards granted by the Regional Ministry of
Sustainability, Environment and Blue Economy.
In this case the recognition was for the Life Ulises
project, developed at the El Bobar WWTP in
Almería, as a model for transforming treatment
plants into zero-discharge biofactories.

Recognitions were also received for leadership and
people management. On one hand, the Diversity
Leading Company 2023 seal, which included
Aqualia among 83 companies commitment
to diversity and inclusion. Also, the company
renewed its “Equality in Business-DIE” distinction
for another five years, granted by the Ministry of
Equality to entities that develop gender equality
policies. It was obtained in 2010 and has been
extended.

At international level, in the United Arab Emirates,
the public Al Ain Distribution Company recognised
AqualiaMACE, a company formed by Aqualia and
Emirati firm MACE, as a Partner in Responsibilities
for its commitment to over 500 employees in
health, safety and environment. In Colombia,
the secretariat for Education and the Municipal
Library of Cereté recognised the company for
contributing to training new generations in the
importance of water with Aqualiaeduca. Aqualia
was also recognised by the Ministry of Labour
of the Republic of Colombia in collaboration with
the Organisation of Ibero-American States for
Education, Science and Culture, for its notable
participation in the Labour Inclusion Strategy in
Riohacha (La Guajira).

End-to-end Water Cycle Management | Corporate Communication and Sustainability | Page 8 of 12

7.2.
Sustainability

Sustainability strategy
Sustainability at Aqualia SSP

In the macroeconomic context, the advance
of inflation, the difficult geopolitical situation,
the energy crisis and trade wars increase
protectionism and generate mistrust in society. The
need to alleviate the climate emergency has led
many states to foster a framework of regulations
that push companies towards a positive impact,
technological progress and the decarbonisation of
the economy.

Water and water resource management are directly
affected by the climate crisis. Under this premise,
this year Aqualia has consolidated its international
position thanks to the capacity for adaptation of its
professionals and to generating innovative, digital
and sustainable solutions.

In 2021, Aqualia published its first 3-year
Strategic Sustainability Plan (SSP), which has
enabled the company to launch projects that
promote sustainable water management. These
three years have seen the company implement
established strategic lines based on climate
change adaptation and mitigation, culture and
people's well-being, ethics and social impact,
the promotion of technology for integrated
management, digitalisation and communication
with all stakeholders.

For another year, after a successful AENOR
audit, Aqualia has shown its commitment to
environmental sustainability and its contribution
to the United Nations Sustainable Development
Goals. Aqualia promotes and integrates the Ten
Principles of the United Nations Global Compact
and the Sustainable Development Goals (SDGs)
into its corporate culture. The SSP therefore
focuses on achieving the goals established by the
2030 Agenda, focusing on cross-cutting action
linked to the company's activity.

2022 Sustainability Report

Aqualia published its 2022 Sustainability Report,
which includes the company’s performance and
shows the evolution of its 2021-23 Strategic
Sustainability Plan. Aimed at all stakeholders,
the document covers progress in three main
areas: economic development, environmental
performance and social justice.

The Report was prepared according to GRI (Global
Reporting Initiative) standards updated in 2021
and which detail how company activity impacts
the economy, people, the environment and human
rights. The document is audited by AENOR and
is in line with the EU CSRD directive (Corporate
Sustainable Reporting Directive), which proposes
an analysis of the impact of company activity.

One of the new features in the Report were the
interviews with Aqualia executives whose activity is
directly related to the themes of the SSP strategic
lines, heading each chapter.

Internal and external pieces were produced in
physical and online format to disseminate the
report. A corporate website space was opened in
Spanish, another two in Portuguese and one in
French. The report was distributed and publicised
on Aqualia's digital channels. A prelaunch
campaign was held one month earlier on X. In
April, the report was submitted to the Management
Committee, the full book was delivered and
banners were published on the website and in the
water sector media. An email and a video were
also sent to all employees. A week later, a press
release was issued to the media, and executive
summaries were sent to all the municipalities
where Aqualia operates.

“The environmental axis is directly related with the
essence of our work: the care and preservation
of water from public service”, said Félix Parra,
company CEO, in the interview that opens
the report. In it he stresses the importance of
managing the water cycle efficiently to preserve
water resources.

The 2022 Sustainability Report includes the
company’s performance and shows the evolution of
its 2021-2023 Strategic Sustainability Plan.

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Strategic materiality. Listening
process

Drafting of the new Strategic
Sustainability Plan

During the last quarter of the year we worked on
drafting the Aqualia Strategic Sustainability Plan
2024-26. The following were taken into account to
prepare the document:

AENOR requirements in the last review and
certification of the Strategic Sustainability Plan.

Listening to employees regarding
communication and training for SSP 21-23.

Listening process with all stakeholders.

European and global regulations in all areas of
sustainability.

Voluntary reporting standards.

Sustainability performance rating.

The Plan was prepared jointly and transversally at
sessions with the teams responsible for setting
feasible actions and objectives and establishing
homogenous frameworks.

A draft SSP 24-26 was submitted to the Aqualia
ESG Committee in December. Once agreed and
approved, the final document will be submitted for
approval by the Aqualia Board of Directors during
the first quarter of 2024.

Aqualia implements an active and ongoing
listening process with stakeholders to identify
the most relevant environmental, social and
governance issues. This exercise is repeated each
year, generating initiatives that seek to maximise
positive impacts and minimise negative.

The Strategic Materiality Study identifies and
analyses aspects that can serve to updated issues
of interest for all relevant stakeholders identified.
Based on research of secondary sources such as
the Green Deal or OECD and UNESCO documents,
and interviews and surveys of internal (employees)
and external stakeholders (public administrations,
customers, users, suppliers, media, NGOs), issues
of interested are obtained, segmented by scope
(social, people, governance and environmental)
and importance for stakeholders and the company.

The recent European Directive of sustainability
reporting (CDRD) and its European Sustainability
Reporting Standards (ESRS) propose a more
thorough approach to ESG performance and
governance. Aqualia created the first dual-
impact materiality matrix in 2023, which involves
assessing the company’s influence in sustainability
terms from two perspectives:

Impact materiality. How sustainability-related
corporate matters affect stakeholders and the
environment.

Financial materiality. How sustainability-related
matters affect the company’s performance and
financial position.

Sosteniblómetro, the public sustainable conduct meter.

Promotion for the Sosteniblómetro, the first public
sustainable habit meter, has also continued. With
an online test available at sosteniblometro.com,
the public can measure how sustainable they are
with their daily actions. Data was extracted to
generate content for the media, positioning the
company as a leader in sustainability. Aqualia
presented the findings of the 3rd Sustainable
Conduct Barometer on World Environment Day in
June; and in December, it published data from the
4th Barometer.

Awareness

Environmental

Aqualia once again launched a new edition of
the Children’s Digital Drawing Contest on the
microsite aqualyods6.com, an initiative with
over two decades of history. This time, the stars
are accompanied by the Sustainable Gang, who
embody daily actions that help care for the
environment, and together they visit different
ecosystem. On the portal, children aged 8-10
can learn about the SDGs and complete their
drawings online. Through this initiative in Spain and
Colombia, Aqualia aligns itself with and supports
academic institutions and public administrations,
while also moving closer to SDG 4: “Quality
Education.” Around 300,000 children have already
taken part in the contest. In 2023, the competition
saw 7,932 entries submitted and provided
4,100 hours of digital training.

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Another example of environmental awareness
was our participation in the 15th National
Environmental Journalism Congress organised by
the Environmental Journalist Association (APIA)
in Madrid with the slogan ‘Water counts’. Held
in October, the event presented different water-
related cases of communication. Juan Pablo
Merino, Director of Corporate Communication
and Sustainability at Aqualia, presented “Ten days
working against the clock to resolve the greatest
water crisis in Castilla-La Mancha” during which
he spoke of the crisis caused by damage in the
infrastructure taking water from the Picadas
Reservoir (Madrid) to the Valmojado PWTP
(Toledo).

Another initiative that Aqualia undertook at local
level was the campaigns for the responsible
use of water, promoted in August due to the
serious drought that hit southern Spain hard.
Numerous councils asked Aqualia to develop
awareness-raising actions: Jaén, Barbate (Cádiz),
Tarifa (Cádiz), Alcalá de Henares (Madrid), Berja
(Almería), several municipalities in the Canary
Islands, Miajadas (Cáceres), Ronda (Málaga),
Arcos de la Frontera (Cádiz), Rota (Cádiz), Torrox
(Málaga), Vigo (Pontevedra), etc.

Other local initiatives were also launched. For
example, the 2023 World Multisport Championship
Ibiza, which became the first “0 waste” triathlon
championship in the world thanks to the innovative
zero-waste water system installed by Aqualia at
refreshment stations. Athletes were given over
11,000 litres of water, preventing the use of 35,000
plastic bottles. In Hellín (Castilla-La Mancha),
Aqualia distributed cardboard cups and tap water
for the “Ciudad de Hellín” half marathon. In Burgos,

Aqualia donated 350 reusable water bottles so
researchers at the Atapuerca archaeology site
could quench their thirst in a sustainable way.

Initiatives related with biodiversity included
“The Tree of Life”, also in Hellín (Albacete). In
collaboration with the local council, over 80 school
pupils learned about the importance of caring
for water and how to protect the environment by
planting trees to form a forest around the Hellín
WWTP.

Internationally, 100 trees were planted in the
towns of San Antero and Planeta Rica of Córdoba
(Colombia) to mark World Tree Day in October.
Throughout the year, Aqualia planted more than
500 trees in similar actions around the country,
recalling the importance of protecting green
spaces. Over 1,000 river turtles were released in
the same department, in the town of Lorica. In Italy,
Caltaqua signed a partnership agreement with
Zero CO2 with the aim of reducing CO2 emissions
by planting trees and in turn helping families in
Tanzania.

Aqualia’s activity incorporates the concept of
sustainability, reflected in numerous actions
launched. For example, the inauguration of
Southern Europe’s largest industrial water
treatment plant in Tarragona (AITASA), attended
by Juan Luis Castillo, Director of Zona II; Santiago
Lafuente, Director Spain; and Felix Parra, Aqualia
CEO. This facility regenerates water from the
Tarragona and Vila-seca WWTPs for reuse in
industry.

To mark World Water Day (22 March), Aqualia
launched the message that companies specialised
in water management have a key role to play in
improving efficiency and sustainability through
technology development. Content was published
by over 30 media outlets (eight national and
21 regional), both print and digital.

For World Toilet Day, 19 November, Aqualia
stressed “your essential role” by highlighting
the harmful effects of not caring for t
he sanitation network. Aqualia resumed its
actuaconaqualia.com initiative, appealing for public
commitment to using the toilet properly and not as
a wastepaper bin with press releases, advertising
graphics and social media.

Other campaigns were activated throughout the
year such as World Environment Day or the 8th
anniversary of the Sustainable Development Goals,
launching the #ComprometidODS campaign.

Campaign Against Cender Violence in Colombia.

One local milestone was the visit to the Toledo
WWTP by Javier Ariza, Director General for the
Circular Economy of Castilla-La Mancha. Other
circular economy projects in the region were also
presented during this visit, such as Life Answer
(Alovera brewery), Life Memory (Alcázar de San
Juan WWTP) and Life Intext (Talavera de la Reina
WWTP, Toledo).

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goes to an Adecco Foundation projects aimed at
helping women in different complicated situations
join the job market: the ‘Employment Camp’ 2024.
The People and Culture department offered several
seminars at this camp. Thanks to this campaign,
in 2023 Aqualia contributed to training 15 women
with a training and career guidance workshop.

Aqualia collaborates in promoting employment
for women at risk of exclusion with the Adecco
Foundation “Woman Programme”. A group of
26 women at risk of exclusion, some victims
of gender violence, visited the Aqualia Contact
customer service centre in Madrid.

Aqualia has maintained an agreement with Cáritas
since 2016, with which it donates the amount
of water bills of centres located in towns with
this service to the NGO. In 2022, this amounted
to 62,000 euros, which benefitted more than
25,000 people in a vulnerable situation or at risk of
exclusion. This partnership involves 143 centres in
42 towns.

The social funds for Arcos de la Frontera and
Chipiona (Cádiz) were also renewed to pay for
water, sewage and water treatment bills for people
with financial troubles.

The Deep Purple project photobiorefinery was
inaugurated at the Linares treatment plant. The
event was attended by the Mayoress of Linares,
María Auxiliadora del Olma, and Secretary of State
for the Environment, Hugo Morán, among other
authorities. This initiative treats water with purple
bacteria and its main goal is to use wastewater as
an energy resource by generating bioproducts.

Meanwhile, Aqualia’s offices in Oviedo held the
presentation of the results of the RE – CARBÓN
project. This research has been running since
2019 at three services in Asturias: Grado WWTP,
Luarca WWTP and Entralgo PTWP. It is a circular
economy initiative to verify the technical and
economic feasibility of regenerating spent
activated carbons and producing biochar
(charcoal) to reduce waste, raw material
consumption and foster energy savings.

Social

Aqualia designs and participates in initiatives
to raise awareness of equality and diversity. On
International Women’s Day (8 March), Aqualia
encouraged users to share their female inspirations
with the slogan “Inspiring and real”. The campaign
ran on the aqualiaigualdad.com website. Aqualia
took part in preparing the “#Jobsforall: women at
risk of social exclusion in the job market” report
with the Adecco Foundation.

To mark the International Day for the Elimination
of Violence against Women, held on 25 November,
Aqualia launched a new initiative on the
aqualiacontigo.com website, this time under the
slogan “In the face of violence against women,
drops of solidarity”. Financial support from Aqualia

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This year, the 2022-2023 edition of the Community
Grant Programme by Australian fund IFM
Investors selected two Aqualia projects in
collaboration with local NGOs in Spain and
Colombia. The programme, which supports
associations that promote social or environmental
initiatives in different communities, will give a
grant to both projects. Once will be developed in

Galicia by means of an agreement with Asperga
(Galician Asperger Association) in order to help
two people with Asperger Syndrome find jobs. The
other will consist of supplying and installing filters
to improve water quality for 1,800 people in rural
communities for Colombia in collaboration with the
Rotary E-Club association.

In the area of diversity, Aqualia supported inclusion
by providing jobs of people with disability in
Tomelloso (Ciudad Real) and San Juan del Puerto
(Huelva). The company recently launched two
initiatives to hire people with different disabilities.
One was in San Juan del Puerto (Huelva), with the
Asociación de Jóvenes Especiales de Moguer-
Abriendo Puertas, and the other in Tomelloso
(Ciudad Real) with the Cadisla Foundation.

information. It includes all the strategic lines of the
2021-23 Strategic Sustainability Plan (SSP) with
their indicators, evolution and SDGs affected. With
the 2021-2023 Strategic Sustainability Plan (SSP),
Aqualia addresses its commitment to sustainability
and defines its strategies and priority lines of
action. And as a basis for establishing the cores
and commitments of the Strategic Sustainability
Plan, Aqualia uses its Strategic Materiality Study.

Aqualia continues to foster equality between men
and women and this year held the first meeting of
AqualiaWomen, the internal network to promote
professional development that aims to consolidate
commitment to equality and diversity.

The company is involved in the communities
where it provides services, also at cultural level.
In Catalonia, Aqualia supported the Díada de Sant
Jordi in Lérida as part of the World Book Day
celebrations. The company installed 75 banners
with the slogan "Water and culture, essential".

Governance

Aqualia works to achieve its sustainable business
objectives and establishes mechanisms to hold
itself accountable for the impact its decisions
have on sustainability. For this reason, the
company communicates its decisions and
activities through reports, placing as much
emphasis on sustainability information as financial
information. This results in documents such as the
Sustainability Report.

The 2022 Sustainability Report includes Aqualia’s
economic, environmental and social performance
with complete quantitative and qualitative

At corporate level, Aqualia continues to focus on
continuous improvement without losing sight of
the principles of transparency. It is one example
that led to migrating local web portals to a new
format as mentioned previously. To adapt to the
recent Directive (EU) 2020/2184 on the quality of
water intended for human consumption, Aqualia
is working on migrating the "Public information”
portals to a new format that complies with the
regulation and even extends it in certain aspects.

The company looks to continue contributing to
its goals for health and well-being, equality and
diversity, and decent and healthy employment,
which are reflected in every internal and external
communication and in each campaign. The
Corporate Communication and Sustainability
department tracks its communications with this
basis. And also in terms of ethics and regulatory
compliance, conveying its cultural of ethical values
by means of internal communication. One clear
example is Compliance Tips, information clips
regularly sent to all Aqualia employees on the main
compliance policies.

Cheque presented to the Best Buddies organisation thanks to the Christmas charity action.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

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8. Regulatory compliance

Compliance management has continued to work
on rolling out the Compliance Model at new
companies included in the perimeter in Colombia
(by implementing the SAGRILAFT programmes on
the prevention of money laundering and PTEE on
transparency and ethics), Saudi Arabia and France,
thus implementing the Code of Ethics and Conduct
and corporate policies at the new companies.
Work has also continued to achieve a Compliance
model at various joint ventures in which Aqualia is
a shareholder along with various Spanish public
authorities.

Following the implementation of a Compliance
Model at Georgian Global Utilities JSC is 2023,
specific control and process owners have been
appointed to run those controls to mitigate
the main compliance risks in the activity of the
company and its Georgian subsidiaries. This year,
the self-assessment on enforcement of controls
and processes was carried out with the relevant
owners for Aqualia’s activity in Georgia. The self-
assessment was also regularly conducted in other
geographic areas of Aqualia in recent years with
monitoring by the Compliance department to verify
that controls are applied correctly.

From the third line of defence, the FCC Internal
Auditing Management has once again reviewed
the Compliance Model where the ongoing
development of the Compliance Management
System within Aqualia has been verified.

8.1.
Compliance policies
and procedures

With the entry into force of Spanish law 2/2023,
of 20 February, regulating the protection of
whistleblowers reporting regulatory breaches and
the fight against corruption, various Compliance
Model rules affected by the requirements of the
law were adapted and approved by the Aqualia
Board of Directors. Similar legislation was also
passed during 2023 in other European jurisdictions
as a result of transposing the Directive which, in
most cases, have been covered by the adaptations
of the Aqualia parent company.

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A new Compliance reporting procedure has
also been approved, establishing the criteria to
be followed by Compliance Officers and local
Compliance coordinators by country and region
for regular reports and a protocol on managing
conflicts of interest applicable throughout the
organisation.

8.2.
Training
and awareness

The launch of online training on the Code of
Ethics and Conduct in the Czech Republic, Italy,
Portugal, France, Colombia, Mexico, Peru, Chile,
Saudi Arabia, United Arab Emirates and Egypt, as a
continuation of the course last year in Spain, was
a milestone in the training plan as the course has

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been adapted and translated into the predominant
languages of each country, conveying the ethical
principles and values that must guide Aqualia
employee conduct.

Specific job-based online training was also
provided in 2023 to Aqualia employees activity
in each of the countries listed above, and also in
Spain, on conflicts of interest to provide knowledge
on the different types of conflict and case studies
so as to identify the existence of possible conflicts
of interest.

New employees joining the company are trained in
the Code of Ethics and Conduct and, depending on
their position, on international standards to prevent
corruption and how it specifically applies at the
company.

Specific training was provided in Colombia on the
SAGRILAFT and PTEE systems and in Italy on the
Organisation and Management Model updated
according to Legislative Decree 231/2011.

As part of continuously raising awareness among
the workforce, different Video Compliance Tips
recorded by the Chief Compliance Officer, other
Compliance Officers and local Compliance
coordinators were launched. The aim is to
convey messages on Compliance culture, the
new whistleblower protection regulation, the due
diligence procedure with third parties, influence
peddling, the operation of the Ethics Channel,
how to preserve company assets and ethical
commitment in the daily work of employees.

8.3.
Risk, controls
and monitoring
assessment

Given that new crimes such as animal abuse were
included in the Spanish Criminal Code in 2023
that can trigger criminal liability of legal entities,
the Compliance risk analysis was reviewed to take
this new regulation into account. Likewise, the
risk analysis for Aqualia activity in Italy was also
updated due to the introduction of new crimes
that can lead to liability for businesses (payment
instruments other than cash, crimes against
cultural and landscape heritage).

Again, two control self-assessments on the
implementation of controls by control and process
owners were conduct, making it possible to
know the level of execution of such controls, and
potential improvements to be developed based on
the information provided by the owners. Controls
and processes of Aqualia companies operating in
the Republic of Georgia and Czech subsidiaries
Vodotech and Aqualia Infraestructuras Inženýring
were also included in the self-assessment in 2023.

One of the ‘Compliance Tips’, regulatory compliance video clips to raise awareness among the workforce.

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Effectivity of control execution is verified with
monitoring by the Compliance department as a
second line of defence to mitigate risks.

Second line of defence monitoring performed
by the Compliance department is especially
relevant for risk mitigation, wherein the processes
identified in Aqualia's activity are analysed by
sampling the evidence that demonstrates the
execution of controls. This makes it possible
to know whether the evidence is sufficiently
robust to mitigate the initial risks identified and,
if they can be improved, to propose effective
action plans that enable effective controls, thus
working towards continuous improvement of the
compliance system. Execution of 45 controls by
over 220 control owners was analysed in 2023.
A strengthening in both execution of controls
and evidence of their implementation has been
observed, reinforcing storage of this evidence to
make it more accessible to the different company
departments responsible for execution, verification,
supervision and auditing.

8.4.
Due diligence
with third parties
in Compliance issues

The due diligence procedure with third parties
in Compliance issues was updated in 2023 to
include cases of risk review for third parties that
continue to have relations with Aqualia. According
to whether the risk determined during due diligence
was low, medium or high, its analysis will be
reviewed every three, two or one year, respectively,
to monitor for changes in risk level and if, in the
worst case scenario, mitigations plans must be
reinforced with that third party to reduce Aqualia’s
exposure to the risk.

At year-end 2023, at corporate level, 83 internal
requests have been received to analyse third
parties. Of the final assessment reports issued
by Compliance management, 12% of third parties
were classified as high risk; 55%, medium risk
and 33%, low risk. Depending on the risk levels,
mitigation measures are applied, and then the
proper implementation of these measures is
monitored.

8.5.
Ethics Channel
(Whistleblowing line)

Up to 31 December 2023, 68 alerts were received
on the Ethics Channel related to labour issues
(25%), customer management (19%), conflicts of
interest (4%), improper use of company resources
(4%), harassment (3%), internal fraud (2%) and
other matters such as technical management,
site management and organisation issues which
together total 6%. Additionally, 37% of the alerts
have been considered as not relevant because they
are customer queries, complaints or claims that
have to be managed through aqualia contact or for
other reasons that mean that they should not be
considered as alerts for the purposes of the
Ethics Channel.

By country, 60% of the alerts concern activity in
Spain, but alerts have also been received from
Portugal (16%), Czech Republic (7%), Mexico (6%),
Colombia (3%), Georgia (3%), France (3%) and
Saudi Arabia (2%), which shows that the Ethics
Channel is gaining increasing relevance in the
international jurisdictions where Aqualia operates.

Alerts classified as high or medium risk are
analysed in detail and, where appropriate, an
investigation opened to clarify the facts and, if
necessary, their resolution through an action plan
for enhanced internal control.

9. Digitalisation and cybersecurity

9.1.
Digitalisation

Aqualia remains committed to digitalisation as a
key tool for achieving its goals in sustainability,
efficiency, public service improvement and
transparency, all added to a detailed analysis of
data managed allows us to clearly improve our
decision making as a company to benefit citizens.

Aqualia Live is our platform designed and created
by Aqualia experts with know-how of the end-to-
end water cycle and technology. In other words,
designed for people “of water and for water”.

Our platform covers all end-to-end cycle processes,
starting with training and also purification,
distribution, the customer life cycle and ending
with treatment and reuse.

2023 was the year for consolidating the Aqualia
Live platform.

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AQ360, the field services app, has transferred
business operations to the field (from complete
work order management to meter readings and
surveying our inventory of field network elements),
gaining in efficiency and ensure a direct and fluid
flow of information from where it is produced to
our central system, providing feedback.

A project has begun for the automatic remote
detection of urban elements using artificial
intelligence which will allow quicker and more
accurate identification of swimming pools, green
areas, differentiation of types of land, etc., in
2024 using image analysis so as to progress in
improving water efficiency.

Note that the dynamic assignment of work orders
to the nearest qualified operator can reduce or
eliminate travel, which translates into fuel savings
and fewer CO2 emissions, eliminating paper (more
sustainable) and improving response times and
information quality, thus increasing operational
efficiency which leads to a better service.

GEO, the geographic information system, has
enabled georeferenced network element surveys to
identify them and prepare a more precise hydraulic
model of the network which, combined with
distributed water volumes, flows and pressure, has
reduced network faults, provided knowledge on
water age and supplied the city with the necessary
water at all times, optimising consumption as
much as possible given its scarcity in some areas.

LAB, the app for water quality management allows
us to comply with European regulations on water
quality, transposed in Royal Decree 3/2023, of
10 January, establishing the technical and sanitary
criteria of the quality water for consumption, its
control and supply. This app will be consolidated in
2024 for all end-to-end water cycle management
at Aqualia

IAWA, the brain behind the platform that collects
and analyses a large volume of information for
smart decision-making, consolidated early leak
detection in 2023 thanks to information obtained
from the supply network in SCA real-time, along
with local weather forecasts, network sectorisation
and other external factors, to identify possible
leaks and send them to AQ360 for field verification.
This early detection can prevent unnecessary
water loss and greater damage to the network.
Reducing losses also means that this water did not
have to be treated and, therefore, less electricity
and reagents are used It is a clear example of how
technology is a great ally for sustainability.

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Digitalisation, a key tool for efficiency in water cycle management.

Location of Operations Centres in Spain.

Additionally, in 2023, the plan to roll out remote
meters continued with almost 400,000 customers
reached. They are all consolidated in AWA,
regardless of the communication technology
(NBIoT, LoraWAN, WMBUS) and meter
manufacturer. This has allowed us to analyse
millions of data and detect a series of patterns
thanks to Big Data, Machine Learning and Artificial
Intelligence, generating early alerts for end
customers, such as leaks, lack of consumption,
consumption in unidentified periods (squatter
alert), etc. With this we can provide customers with
more information, be sustainable and transparent
in our management. The strategy will continue in
2024, consolidating Aqualia’s technology position.

During 2023, we have continued to incorporate
Operations Centres fully using the Aqualia Live
platform, helping municipalities to standardise
their operations and ensuring compliance with
the standards of Aqualia commitments with the
different councils, providing common visibility for
sustainable, efficient and uniform operation at
regional level.

Finally, in 2023, Aqualia has created regional
Logistics Centres in Salamanca, Valdepeñas,
Oviedo and Vigo for a more efficient management
of materials and services necessary for Aqualia
operations in the different municipalities, in order
to guarantee that critical materials are available
at all times for municipalities under their scope,
managing more efficient procurement and
preventing additional travel. All this thanks to the
AQ360 platform where, backed by this technology,
these logistics centres can be controlled with great
accuracy and integrating solutions with the main
Aqualia material suppliers. We will continue to
create regional logistics centres in 2024.

At international level, concessions in France
continue working with Aqualia Live and new
concessions in Colombia started to do so in the
second half of 2023.

Finally, Aqualia has prepared for the PERTE
projects, both the first demonstration project phase
and the second more general phase, always with
a focus on water digitalisation and maintaining
the same technology strategy that we have been
following as a company in recent years.

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9.2.
Cybersecurity

It is important to make a great effort in
Cybersecurity given the high level of exposure
to cyberattacks, the growing and more evolved
threats, vulnerabilities that come with all the
necessary advances and digitalisation itself, and
the risks and likelihood of a critical event with
reputational, economic, tangible and intangible
losses.

Risk management and analysis was addressed
in 2023 with work to detect the assets to be
protected, regularly assessing risks to be able to
prevent incidents, and reduce or mitigate them.
The goal of this process was and is to: identify,
analyse, measure and manage risks associated
with information security, providing the necessary
cybersecurity measures and controls to continue
protecting Aqualia assets and, therefore, availability
of information for employees, for customers and
for the availability of our water resources and the
evolution of projects with a high level of criticality,
specialisation and impact on the organisation and
in society.

In 2023, work began on strategic plans in IT / OT
and Cybersecurity specifically, reinforcing the
security perimeter, monitoring and traceability of
access.

At the same time, in 2023 Cybersecurity is being
taken into account across the company with
awareness training for people working in all Aqualia

business liens as well as for infrastructure users at
national and international level.

Aqualia also adapt to Regulatory Agents and
Cybersecurity best practice guides. An audit was
conducted in 2023 regarding how the dimensions
of security, covering availability, authenticity and
integrity adapt to SO/IEC 27001:2014. We are
working to adapt to the most recent version,
ISO/IEC 27001:2022, with several changes to be
addressed following the new paradigms of this
international standard, which sets the requirements
for an information security management system
(ISMS) in line with three pillars: information,
cybersecurity and protecting privacy.

The National Security Scheme (NSS) provides and
analyses an excellent vision of designed objectives
as a scope scenario in the Aqualia roadmap.

In order to achieve improvement objectives for
Information Security (including the classification
and protection of information) and Cybersecurity,
we must comply with the regulations governing
Cybersecurity. The company is therefore active
and attentive to any new regulations developed
nationally and internationally.

In 2023, the US Department of Commerce
has been taken into account as a promoter of
innovation and industrial competitiveness by
advancing in the science of measurements,
standards and technologies to improve economic
security and quality of life. In line with the
guidelines and best practices outlined by the US
National Institute of Standards and Technologies
(NIST), these guidelines are followed as shown in
the figure:

In 2023, an incipient “live” draft document analysis
of the national and international map has been
created to comply with the European NIS Directive,
version NIS v2, which establishes obligations
on exchanging information on Cybersecurity, as
well as monitoring and execution obligations for
Member States (including many of the countries
where we have critical infrastructures and
information offices).

In terms of cybersecurity regulatory compliance,
in 2023 the ISA/IEC 62443 security framework is
being followed as technical standards and reports
to define the requirements and processes for
secure industrial automation and control systems
(IACS). The aim is to find best practices for OT
security and a higher level of security performance
with a holistic approach, narrowing the gaps
between operations and information technologies,
as well as process security and cybersecurity,
establishing points of reference for cybersecurity
with a thorough analysis of the current paradigm.

At the end of 2023, efforts are being made to
address approving more homogenous and
strengthened security architectures for each
Aqualia scenario.

Finally, objectives are set in 2023 to also
give greater value in technical procurement
assessments for suppliers with optimal security
capabilities in line with Regulatory Compliance
in Cybersecurity and certifications in force in line
with: ISO/IEC 27001:2014 and ISO/IEC 27001:2014,
the ENS (any version: basic, medium and/or high),
NIS v1 and NIS v2 and ISA/IEC 62443.

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Infrastructure

1. Industry analysis _ 210

2. Activity in the Infrastructure Area _ 213

3. Highlights Infrastructure 2023 _ 232

4. Sustainability and excellence _ 233

5. Innovation and technology _ 236

In 2023, the FCC Group’s Construction Area
recorded a consolidated total order book
of €6,425.9 million. Gross operating profit
(Ebitda) reached €169.4 million and turnover
increased by 43.5% relative to the previous
year, reaching €2,823.1 million

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With experience built up over more than
120 years, the FCC Group’s Infrastructure Area is
present in 22 countries, namely Spain, Canada,
the United States, Mexico, Colombia, Chile, Peru,
Panama, the Dominican Republic, Romania, the
United Kingdom, Germany, France, Italy, Belgium,
Norway, the Netherlands, Ireland, Portugal, Saudi
Arabia, Australia and Qatar. Its activities cover all
fields of engineering and construction.

FCC is a leader in implementing transport
infrastructure and urban solutions as well as
residential and non-residential construction. It is
currently the fourth largest construction company
in Spain, in terms of contract volume, and in the
top 30 in the world according to the ranking by
the international magazine, ENR (Engineering
News-Record). It has proven track-record in

implementing projects under the concession
regime, and has a group of companies dedicated
to the industrial sector, grouped together under
the brand FCC Industrial, as well as other
activities related to the construction sector.

In 2023, the FCC Group’s Construction Area
recorded a consolidated total order book of
€6,425.9 million. Gross operating profit (Ebitda)
reached €169.4 million and turnover increased
by 43.5% relative to the previous year, reaching
€2,823.1 million. In 2023, the portfolio of
international projects declined by 15.3%, while
income was over €1,715 million.

Over the course of 2023, the Construction Area
was awarded contracts worth approximately
€2,106 million in total.

Experience and ability

More than 1,000 km of tunnels.

50 dams and 150 km of quays.

More than 10,000 km of roads and
motorways.

1,850 bridges.

More than 3,500 km of railways, of which
1,500 km are high speed and 450 km
metro.

More than 5,500,000 m2 of airport
runways.

More than 2,500,000 m2 of airport
terminals.

More than 3,000 km of oil and gas
pipelines.

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Arterial Railway Network. Eastern Bypass, Valladolid (Spain).

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Infrastructure | Industry analysis | Page 1 of 3

210

1. Industry analysis

1.1.
Domestic market

Spain

The construction sector ended the year 2023 with
growth of 2.8%, bringing the level of production
to slightly above that of the year 2019. Forecasts
for 2024 (1.4%) and 2025 (1.2%) assume no
major upsets in the European macro-economic
context The sector faces challenges due to the
chronic shortage of manpower and the high cost
of supplies, energy and credit. As for prospects
for residential construction these are rather flat
for the period 2023-2025: minimal growth in 2023
(1.0%), stagnation in 2024 (0%) and slight fall
in 2025 (-0.5%). These three years of suspense
should serve to clear up any doubts as to what
the real effects of the new Housing Law will be,
to what extent all the public housing announced
before the elections will be executed and when the
traditional buyer - for whom it is essential to obtain
a mortgage loan - will return to the market. These
three questions are likely to be resolved favourably,
allowing the residential segment to escape
stagnation in 2026 (2.5%).

The situation described for housing can be more or
less extrapolated to non-residential construction, in
which operators are also proceeding with caution
in view of the signs of slowdown reaching the real
estate market. This translates into more rigorous
selection of projects, with priority being given to
those of the highest quality and the best locations
in the most resilient market segments. Production
in 2023 benefited from inertia (2.0%) but judging
by the project order book, 2024 looks like being
a slightly negative year (-1.0%). Projections for
2025-2026 are in the 1 to 1.5% range.

The refurbishment market had hoped that the
PREE programme of subsidies for energy-efficient
refurbishment would induce more households
to invest in improving the energy-efficiency of
their homes. Results of the programme so far are
below expectations, so forecasts for 2023 (2.5%)
and 2024 (2.6%), despite being robust compared
with figures for new-build, are below the initial
projections.

Civil engineering is the segment that is making
most use of the NGEU (Next Generation EU) funds.
The forecast for 2023 was particularly expansive
(7%), after which growth rates slacken (3.9% in
2024 and 2.6% in 2025) although they are still
above those projected for GDP.

Complete remodelling of the Santiago Bernabéu Stadium Madrid (Spain).

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1.2.
International market

Europe

Continued growth of the European construction
industry is subject to limitations. Beyond the
weakening of the economy and the increase in
costs, it is necessary to indicate that the year 2022
was a record year for the sector. In the current
environment it is no longer possible to sustain
such a growth rate, and indeed the sector started
to shrink in 2023 (-1.7%) and all the indications are
that it will do so further (-2.1%) in 2024.

The two years of contraction have positioned
the European sector at a level of production
comparable to that recorded in 2019, which stood
out as the fourth best year since 2000. This figure
certainly represents a respectable level. Estimates
for 2025 and 2026 point to a return to growth, with
projected increases of around 1.5%.

The epicentre of the downturn in the European
construction sector continues to be residential
new-build. This segment will account for €85
of every €100 of production lost in the two-year
period 2023-2024. The forecast is for two years
of intense adjustment (-8.4% in 2023 and -7.4%
in 2024) leading to only 1.51 million homes being
completed in 2025, 15% fewer than the 1.75 million
average per year in the period 2017-2023. The
positive exceptions will be the Nordic countries,
growing once more after having been the first
to enter recession; and the biggest negative

exceptions will be Germany and Italy, where the
recessive cycle will be longer.

The infrastructure investment panorama in Latin
America is growing strongly:

Non-residential construction will make a further
negative contribution, albeit less so, to 2023-2024
(-1.0% in 2023 and -1.2% in 2024). Once we get
over this period of contraction, growth should
return in 2025-2026 (+1.8% p.a. average) despite
which production in 2026 (at constant prices) will
still be 5% lower than it was in 2019. With a few
exceptions in construction relating to health and
education, all market niches are finding it more or
less difficult to grow.

Civil engineering is the exception in the overall
panorama of lowered expectations. Estimated
growth for 2023 (+3.8%) is higher than forecast
just six months earlier, while forecasts for 2024
(+2.5%) and 2025 (+2.5%) are maintained. Despite
the fact that the economic environment is not
optimal, the engineering market will reap the
rewards of its efforts to decarbonise transport and
the supply of energy in Europe, in which the Next
Generation funds play a vital role.

Latin America

Latin America in 2023 presented investment
growth in infrastructures of 6%. The IDB (Inter-
American Development Bank) estimates that
investment of US$100 billion per year is needed
for the next few years to improve and strengthen
infrastructure and promote commercial
development in the region.

Transport infrastructure
(US$33.6 billion).

Energy infrastructure
(US$6.6 billion).

Town planning projects and services
(US$4.2 billion).

North America

The outlook is positive. The US Infrastructure
Development Plan, which has an amount of
US$1.2 trillion, of which US$550 billion are for civil
engineering projects, including funds for roads,
bridges, airports and railway systems, represents a
major attraction for companies.

Since its approval at the end of 2021, the
Infrastructure Investment and Jobs Act (IIJA)
has been acclaimed as a big step towards the
reconstruction of US infrastructure. Apart from
this, the Inflation Reduction Act is the biggest
investment in the history of the United States
in the fight against climate change, since it
contributes some US$370 billion to strengthening
sustainability efforts, increasing energy security
and reducing energy costs. The law uses tax
credits as the main mechanism to attract clean
technologies and energy from renewable sources
to the US, and there is evidence that the strategy is
working.

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211

GoExpress Corridor (Canada).

It is calculated that US$150 billion will be devoted
to clean energy initiatives at the level of public
services.

The infrastructure development plan breaks down
more specifically into the following items:

US$65 billion (€56 billion) to expand broadband
telecommunications.

US$65 billion (€56 billion) for the renewal of the
electricity grid, with priority to generation from
renewable sources.

City Esports Arena. Designed as a new global
entertainment, sports and culture centre alongside
a multi-use stadium in the city. Projected to
become an innovative institution that will serve as
a focal point for the city of Qiddiya.

US$110 billion (€95.2 billion) for the
reconstruction of road infrastructure.

Middle East

US$46 billion (€39.8 billion) for railways,
including US$21.8 billion for the Washington-
New York-Boston corridor.

US$25 billion (€21.6 billion) for airport
infrastructure.

US$17 billion (€14.7 billion) for ports.

US$55 billion (€46.7 billion) for improving the
supply of drinking water.

Various infrastructure plans are currently being
designed, from which transport projects (metro/
underground, airports, high-speed railways) and
new water projects will be derived. Saudi Arabia’s
international plan to create a new city deserves
special mention: NEOM. This new city is beginning
to implement its first infrastructure projects. With
an investment of over US$500 billion, this project is
part of the Saudi Vision 2030 political programme.

The transformation is led by Riyadh, which will
host the Expo 2030 world fair. A new global
entertainment, sports and culture centre that
is in progress stands out in particular: Qiddiya

Australia

The Australia Infrastructure Plan is beginning
implementation. The plan responds to the
180 challenges and opportunities. Infrastructure
Australia's vision for 2036 is to have an
infrastructure that improves the sustainability of
the country's economic, social, environmental and
governance environments, supports quality of
life for all Australians and is resilient to emerging
stresses.

The investment in infrastructure, more than
$225 billion, will give Australia a solid structure
and make it one of the world’s most attractive
infrastructure markets.

212

1.3.
Industrial activity

FCC Industrial carries out its activities in various
sub-sectors, ranging from manufacturing to
operation and maintenance, as well as the design
and construction of industrial facilities.

The economic situation in Spain has seen
investment growth slow, severely affected by the
energy crisis, and the high inflation and price growth
in supplies worldwide. Consequently, the anticipated
impact of the PNIEC (National Integrated Energy
and Climate Plan) and the Recovery, Transformation
and Resilience Plan, which were expected to
catalyse industry growth in the renewable energy
sector, and digitisation and new technologies after
the pandemic, is not being felt.

However, there are certain market niches for
particular products in specific countries where
FCC Industrial operates that represent an
opportunity for growth as part of the strategy to
diversify activities and markets.

Francisco Pizarro Photovoltaic Plant, Cáceres (Spain).

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Infrastructure | Activity of the Infrastructure Area | Page 1 of 19

2. Activity in the Infrastructure Area

2. Canada
195 kilometres of Trans-Canadian
motorway (30 years).

Scarborough Subway
Extension-Stations, Rail and
Systems.

GO Regional Express Rail
On-Corridor.

3. U.S.A.
PennDOT pathways Major Bridge
P3 Initiative, Pennsylvania.

4. Mexico
Tren Maya. Section 2.

5. Colombia
Guillermo Gaviria Tunnel.

“El Salitre” wastewater treatment
plant.

6. Peru
Line 2 and Line 4 branch of the
Lima metro.

New fuel storage and aviation fuel
storage tanks at Lima Airport, Peru.

1. Spain
Remodelling of Santiago Bernabéu
Stadium, Madrid.

Puertollano Hospital, Ciudad Real.

Corporate HQ of the ONCE Group,
Madrid.

Completion of the circular road in
Tenerife, Canary Islands.

Platform for the Murcia-Almeria
High Speed Mediterranean
Corridor. Totana section.

263 MW PV plant, Guillena, Seville.

New contracts awarded

In progress

Completed

Civil engineering

Non-residential construction

Hydraulics

Maintenance

Industrial

Environment

Market 2023

National:

Portfolio of contracts: €2,386.1 million
€1,108.1 million
Turnover:

International: Portfolio of contracts: €4,039.8 million

Turnover:

€1,715 million

7. Chile
Parque Mapocho Río.

Concepción Industrial Bridge.

8. Portugal
Oporto Metro. Rubi Line: Casa da
Música-Santo Ovídio.

Modernisation of the Western
railway line between Mira
Sintra-Meleças and Torres Vedras;
and between Torres Vedras and
Caldas da Rainha.

Decontamination of soil in the
Alvito quarry.

9. Saudi Arabia
Additional stations on Line 4 of the
Riyadh Metro. Park and Ride on
Line 4. Science Park on Line 5.

Lines 4, 5 and 6 of the Riyadh
Metro.

Neom Tunnels (Mountain Section).

10. The Netherlands
Section of the
Badhoevedorp-Holendrecht A9
motorway.

11. Germany
LNG regasification plant, Hamburg.

12. Norway
RV 555 Sotrasambandet, the Sotra
Connection.

13. United Kingdom
Section of the A465 dual
carriageway.

Energy Recovery Centre, Drumgray,
Scotland.

14. Romania
Railway lines in Transylvania and
new railway awards.

Design and construction of the
wastewater treatment plant and
sludge incinerator in Glina,
Bucharest.

15. Australia
Melbourne Airport
Link-Maribyrnong River Bridge.

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80 homes in Alcalá de Henares, Madrid (Spain).

Complete remodelling of the Santiago Bernabéu Stadium Madrid (Spain).

Infrastructure | Activity of the Infrastructure Area | Page 2 of 19

2.1.
Projects in development

Over the course of 2023,
the Construction Area was
awarded contracts worth
approximately €1,176 million
in total.

Construction

Residential construction

Spain

Construction of 344 build-to-rent homes,

storage spaces, premises and car parks on
Block C of Sector 10 of the Marina del Prat
Vermell, Paseo de Zona Franca (Barcelona).

80 homes in Alcalá de Henares (Madrid).

61 homes in PAU Ciudad Deportiva FC

Barcelona in Sant Joan Despí (Barcelona).

42 homes in Arroyofresno Phase II (Madrid).

74 homes in Tres Cantos (Madrid).

64 homes in Tres Cantos (Madrid).

108 homes in Tres Cantos (Madrid).

113 homes in Alcalá de Henares (Madrid).

Awarded

In progress

Completed

Internacional

La Reserve, plots 01 and 02.1 (Portugal).

Non-residential construction

Spain

Works at the controlled tailings deposit

run by the South Madrid Association, with
the expansion of Phase IV, sealing and
degasification of Phase III and the expansion of
leachate processing capacity in the towns of Pi
nto, Getafe and San Martín de la Vega (Madrid).

Remodelling of the Santiago Bernabéu Stadium

(Madrid).

Lot 4 of the framework agreement for the

district of Hortaleza of the Madrid City Council.

Rehabilitation Work for Building III “Tercio”

of the Directorate General of the Civil Guard
(Madrid).

Construction of an underground building with

three basement levels to house the future
132/15KV Electrical Substation in Plaza de
España (Madrid).

Puertollano Hospital (Ciudad Real).

LLot 1 of the framework agreement for
subsidiary implementation operations,
emergency actions and adoption of security
measures in municipal buildings. Implementing
municipal green areas for the “Metropolitan
Forest” project in the municipality of Madrid.

New Institutional HQ for ONCE, the Spanish

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Infrastructure | Activity of the Infrastructure Area | Page 3 of 19

Digital District at the Port of Alicante (Spain).

Marina Baixa Hospital, in Villajoyosa, Alicante (Spain).

National Organisation for the Blind (Madrid).

Renovation of the Philosophy and Humanities

building of the University of Zaragoza.

Execution of the works for the tertiary building

and car park for the Digital District on Dock 5 of
the Port of Alicante.

Refurbishment of Club de Mar de Mallorca in

Palma de Mallorca (Balearic Islands).

Remodelling of facilities of the ASTA building in

the Port of Barcelona.

Office Building on plot P1-P2, sector 10 Marina,

Paseo de Zona Franca (Barcelona).

Execution of the works for the new construction

of an open prison regime centre in the Zona
Franca (Barcelona).

Execution of the Civil Guard Headquarters in

Zaragoza.

Remodelling of the Fish Market Area and

Building in the Port of Barcelona.

Expansion works for the Marina Baixa Regional

Hospital, Villajoyosa (Alicante).

Construction of the new High Resolution

Centre for the Murcia Health Service in Águilas
(Murcia).

Rehabilitation of the Palace of Justice for the

Supreme Court of the Valencia Region.

Construction of the new High Resolution

Centre for the Murcia Health Service in Águilas

Awarded

In progress

Completed

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Rehabilitation of the Palace of Justice for the Supreme Court of
the Valencia Autonomous Region (Spain).

Soria Hospital (Spain).

Infrastructure | Activity of the Infrastructure Area | Page 4 of 19

(Murcia).

International

Construction of the new Concepción Aleixandre

Construction of the rural hotel Dunas da

Comporta (Portugal).

Authentic Bicas Comporta hotel complex,

Grândola (Portugal).

Construction of the stock storage area and
offices for the Móndego mobility system,
Coimbra (Portugal).

Building of the Miguel Hernández University
Campus in San Juan de Alicante.

New Socio-health Complex in the Son Dureta

enclosure for the construction of Building B, in
Palma de Mallorca (Balearic Islands).

Construction of the new Pabellón Cero for

the extension of the FIRA Gran Vía enclosure,
underground phase, L’Hospitalet de Llobregat
(Barcelona).

Expansion and renovation of Soria Hospital.

Salamanca Hospital.

Phase 0 of the Master Plan for the A Coruña

University Hospital Complex.

Drafting of the project, execution of the work
and commissioning of the Environmental
Centre of the Pamplona Region (design phase)
(Navarra).

Expansion and refurbishment works (Phase I)
of the University Hospital of Cabueñes, Health
Area, Gijón (Asturias).

Construction works for the new Aranda de

Duero hospital (Burgos).

Construction works for the New University
Hospital Complex of A Coruña. Phase 1
(A Coruña).

Awarded

In progress

Completed

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Renovation of Line 1 of the Madrid metro (Spain).

Meleças-Torres Vedras railway section (Portugal).

Railways

Spain

First phase of the implementation of the unified
light rail network and its urbanisation in the city
of Barcelona, Avda. Diagonal-Girona-Nàpols
section (Barcelona).

Execution of the Tunnel and Station works for
the University Zone-Sagrera Meridiana section
of Line 9 of the Barcelona Metro – Section III –
IVB, Prat de la Riba, Sarrià, Mandri (Barcelona).

Improved accessibility and adaptation to the
interchange regulations of Maragall station
(L4 and L5 FMB), Phase 1 (Barcelona).

Execution of the works for the Quisi Viaduct

construction project in the Calp-Teulada section
of line 9 of the TRAM network (Alicante).

Duplication of the North-Northwest High Speed
Corridor, section Palencia to Vilecha Fork High
Speed and electrification of newly duplicated
sections of the Palencia-León line.

Track and electrification for the Valladolid

Eastern Rail Bypass.

Architectural and installation works for the La

Sagrera technical train treatment area. Phase B
(Barcelona).

Renovation of track for Line 1 of the Madrid

Metro between Sol and Valdecarros stations.
Lot 1, Sol-Atocha (Madrid).

Sleeper renovation project (Phase 2) and
removal of ballast on the Madrid-Seville
high-speed line.

Renovation of sidings (Phase 2) on the

Madrid-Seville high-speed line.

Preparation of the Roda de Bará Tunnel for

the implementation of standard gauge in the
Mediterranean Corridor. Castellbisbal-Murcia
section. Sub-section: Sant Vicenç de Calders-
Tarragona-Vilaseca Junction.

Execution of works for the project to replace RS
sleepers with monoblock on a 75.91 km section
in the Tardienta district (Huesca).

Maintenance of infrastructure, track, points and
crossings for the Madrid-Northeast high-speed
line. Montagut, Vilafranca and Sant Feliu bases.

Maintenance of infrastructure, track, points and
crossings for the Madrid-South high-speed line.
Antequera base.

Maintenance of infrastructure, track, points and
crossings for the Madrid-South high-speed line.
Hornachuelos and Antequera bases.

Emergency works and services due to flooding
in the municipality of Rincón de Soto. Section
of Intermodal Line 700 Abando Indalecio Prieto-
Casetas. Track conditioning.

Execution of works for the construction

projects to take the ADIF R-2 commuter line
underground as it passes through the town,
and construction of the new Montcada i Reixac
station (Barcelona).

Awarded

In progress

Completed

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Modernisation of the Western railway line
between Mira Sintra-Meleças and Torres
Vedras.

Gauge extension on overpasses, on the route

not affected by the San Julián bypass, between
Ourense-Monforte-Lugo.

Sidings for the railway complex of the eastern

bypass of the Valladolid arterial railway
network.

Execution of the works corresponding to the
sidings renovation project (Phase 1) on the
Madrid-Seville HSL.

Track assembly of Sagrera high-speed Station

Screen replacement service for the Madrid-

(Barcelona).

Architectural and installation works for the
La Sagrera technical train treatment area.
Phase A (Barcelona).

Valladolid arterial railway network. Eastern

Bypass (Valladolid).

Accesses to La Sagrera station (Barcelona).

Trackbed works on the Nijar-Río Andarax

section of the Murcia-Almeria high-speed line.

Architectural and installation works for the
La Sagrera technical train treatment area.
Phase A (Barcelona)

Trackbed works on the Nijar-Río Andarax

section of the Murcia-Almeria high-speed line.

Seville high-speed railway line between
Brazatortas and Seville-Santa Justa Station.

New track configuration as a result of the

elimination of the Ferrol-Ortigueira telephonic
blocks (A Coruña).

Implementation of standard gauge in the
Mediterranean Corridor. Castellón-Vinaroz
section (Castellón).

Renewal of tracks 3 and 5 and replacement of
sidings on Barcelona commuter lines, Blanes
station (Gerona).

Implementation of standard width in the

Mediterranean Corridor. Section: Valencia
North-Valencia Joaquín Sorolla. Track and
electrification.

Trackbed works on the Totana-Lorca section of

Track and catenary for the complete

the Murcia-Almeria high-speed line.

Platform for the Murcia-Almeria High Speed

remodelling of the Fuente de San Luis Station
for standard gauge implementation (Valencia).

Mediterranean Corridor. Totana section.

Track renewal for the Ourense-Monforte de

Track assembly and access (León).

Duplication of the R-3 commuter line.

Section: Parets del Vallés-la Garriga. Track and
electrification R3 (Barcelona).

omprehensive track renovation in the Gijón-

Laviana section of the metric gauge network,
Asturias.

Lemos section. Line 810.

New track configuration as a result of the

elimination of telephonic blocks on
La Asunción-Guardo metric gauge line 790.

Awarded

In progress

Completed

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Accesses to La Sagrera station, Barcelona (Spain).

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Section 2 of Tren Maya Edzná Station (Mexico).

Lines 2 and 4 of the Lima Metro (Peru).

Maintenance of the north-east high-speed line.

International

Brihuega and Calatayud bases (Catalonia).

Maintenance of the north-east high-speed line.

Montagut, Vilafranca and Sant Feliu bases
(Catalonia).

Maintenance of infrastructure, track, and

switches and crossings for the Madrid-South
high-speed railway line. Hornachuelos-
Antequera bases.

Maintenance and pre-maintenance of
infrastructure, track, and switches and
crossings for the Plasencia-Badajoz high-speed
railway line, Mérida and Cáceres Base Areas.

Services, infrastructure and track maintenance
for ADIF 2021-2022 conventional and metric
gauge lines. Lot 2 North Operations Division.

Services, infrastructure and track maintenance
for ADIF 2021-2022 conventional and metric
gauge lines. Lot 5 Central Operations Division.

Services, infrastructure and track maintenance
for ADIF 2021-2022 conventional and metric
gauge lines. Lot 6 South Operations Division.

Integral improvement of the Madrid-Seville

high-speed railway line infrastructure. Section C:
Guadalmez-Córdoba.

Comprehensive maintenance service contract

of the Madrid Metro track superstructure
(Lot 3, approximately 35% of the Madrid Metro
network) (Madrid).

Awarded

In progress

Completed

Section 2 Tren Maya (México).

Line 2 (branch) of Panama metro to Tocumen

International Airport (Panama).

Line 2 and Line 4 branch of the Lima metro

(Peru).

Additional stations on Line 4 of Riyadh Metro.

Park and Ride on Line 4. Science Park on Line 5
(Saudi Arabia).

Lines 4, 5 and 6 of Riyadh Metro (Saudi Arabia).

Neom Tunnels (Mountain Section) (Saudi

Arabia).

Railway lines in Transylvania and new railway

awards (Romania).

Scarborough Subway Extension–Stations, Rail

and Systems, Ontario (Canada).

RER3 Go Expansion On-Corr Project. Complete
renovation of the Greater Toronto commuter
railway (Canada).

Melbourne Airport Link- Maribyrnong River

Bridge (Australia).

Rubi Line: Casa da Música-Santo Ovídio. Oporto

Metro (Portugal).

Modernisation of the Western railway line

between Torres Vedras and Caldas da Rainha
(Portugal).

Móndego Mobility System (SMM) –

Rehabilitation of the Praça da Portagem –
Coimbra B station section, Coimbra (Portugal).

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Lines 4, 5 and 6 of Riyadh Metro (Saudi Arabia).

Early Works – Kennedy Enabling Works, Ontario (Canada).

Infrastructure | Activity of the Infrastructure Area | Page 8 of 19

Modernisation of the Mira Sintra-Meleças-
Torres Vedras section of the Western Line
(Portugal).

Modernisation of the Torres Vedras and Caldas

da Rainha railway line (Portugal).

Adaptación del sistema de movilidad del

Móndego, en Coimbra a una solución de BRT
(Metrobus). Tramo Coimbra B-Portagem
(Portugal).

Hydraulics

Spain

Project and adaptation work of the El Endrinal

WWTP in Collado Villalba (Madrid).

Lot 7 of the Pipeline Renovation Works for the

Canal de Isabel II supply network (Madrid).

Lot 1 of the Works to improve the sanitation

networks managed by Canal de Isabel II
(Madrid).

Distribution network works for the Segarra-

Garrigues System. Sector 8. Secondary support
network Floor B, Perimeter II, Els Omellons
(Lleida).

Distribution network works for the Segarra-
Garrigues System. Sector 13. Secondary
network Floor D1, Llardecans (Lleida).

Heightening of the Yesa dam (Navarra).

Awarded

In progress

Completed

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Works on the distribution network for the

Arona-East sanitation system. Project for

Connection between the Morgavel WWTP and

Expansion of the Playa Blanca Port, Lanzarote

Segarra-Garrigues System. Sector 10-11-14.
Connecting pipes to Pool 300 of Sector 12,
Albagés (Lleida).

Works on the distribution network for the
Segarra-Garrigues System. Sector 13.
Secondary network Floor C1 Perimeter I,
El Cogul (Lleida).

the construction of collecting systems and
associated force mains, Montaña Reverón
WWTP. Aguas de las Cuencas de España
(ACUAES).

Reguengos de Monsaraz hydraulic circuit and

the Peral Irrigation Block.

Construction of sanitation and waste treatment

International

for San Roque and other municipalities in
Campo de Gibraltar (Cádiz).

Storm water tank in El Balcón del Guadalquivir

(Córdoba).

“El Salitre” waste water treatment plant

(Colombia).

Design and construction of the waste water

treatment plant and sludge incinerator in Glina
(Bucharest).

the Monte Chãos reservoir (Portugal).

(Canary Islands).

Enlargement of the Naos Quay, Arrecife,

Lanzarote, Canary Islands. Las Palmas Port
Authority (Canary Islands).

Maritime

Spain

Rehabilitation of security features for the

Botafoc dock foundations in the Port of Ibiza
(Balearic Islands).

Port Adriano, rehabilitation of the dock, Mallorca

(Balearic Islands).

Guillermo Gaviria Echeverri Tunnel (Colombia).

Tenerife Island ring road, Canary Islands (Spain).

Awarded

In progress

Completed

222

Guillermo Gaviria Echeverri Tunnel (Colombia).

Concepción Industrial Bridge (Chile).

Section of the Badhoevedorp-Holendrecht A9

motorway (the Netherlands).

RV. 555 Sotrasambandet, the Sotra Connection

(Norway).

Section of the A465 trunk road in Wales (UK).

Major Bridge P Initiative - Project to rehabilitate

bridges of Pennsylvania (USA).

Roads

España

Construction: completion of Tenerife Island

ring road, section El Tanque-Santiago del Teide.
Canary Islands Government (Canary Islands).

Construction project, A-73 motorway, Burgos-
Aguilar de Campoo. Quintanaortuño-Montorio
section (Burgos).

A-33 motorway. Construction of the section

connecting the C-3223 to Yecla with the N-344,
Caudete. Murcia and Albacete.

Completion of the extension works on the

Baix Llobregat Motorway (New B-25). Section:
Coastal Motorway-A-16 Motorway.

Repair and expansion project for the bridge
structure over the Sella River in Ribadesella
(Asturias).

Reordering and improvement of road access
to the Cívitas Metropolitano Stadium, Phase II
(Madrid).

Demolition, consolidation and construction of
a bridge over the River Alberche, on highway
M-507 in Aldea del Fresno (Madrid).

International

Renovation of the Águas Santas tunnel

(Portugal).

Maintenance of 195 kilometres of Trans-

Canadian motorway for 30 years (Canada).

A-33 motorway at Yecla, Murcia (Spain).

Concepción Industrial Bridge (Chile).

Awarded

In progress

Completed

Aguas Santas Tunnel (Portugal).

Urbanisation

Domestic

Urbanisation of stage 1 of U.Z.P. (Programmed
urbanisable land) 2.04 Los Berrocales (Madrid).

Urbanisation of A.P.E. 027 “New

Mahou-Calderón” (Madrid).

Sanitation network, transformation centre and

reflection centre at the U.Z.P. 2.04
Los Berrocales (Madrid).

Block bounded by Roundabouts G-2, G-3, G-4,

G-5 and Road H-8 within the U.Z.P. 2.04
Los Berrocales (Madrid).

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Earth removal and sanitation (stage 3) located
between Gran Vía del Sureste, A3 and M-50 in
the area of U.Z.P. 2.04 Los Berrocales (Madrid).

Road asphalting plan in Leganés (Madrid).

Reurbanisation, renovation and improvement

of the service networks of Vía Laietana,
between Plaza Antoni Maura and Paseo Colón
(Barcelona).

Framework agreement 2022-2024 for the

“Metropolitan Forest” project, on municipal land
in the municipality of Madrid.

International

Parque Mapocho Río (Chile).

Lots 1 and 2 of the Urbanisation works of

Phase III of APE 02.27 “New Mahou-Calderón”
(Madrid).

Decontamination of soil in the zone covered by
the Detailed Plan of the Alvito Quarry (Portugal).

Execution of the Stage 3 works in U.Z.P 02.04

Industrial

Los Berrocales (Madrid).

Connectivity and urbanization improvements

for the area around the Santander Street Bridge,
in the Sant Martí District (Barcelona).

FCC Industrial

In 2023, FCC Industrial began work on the
Drumgray waste-to-energy plant construction site
in Scotland, UK.

The company also won the engineering and
construction contract for the Lima Airport fuel
storage plant, Peru, to cater to the expected growth
in traffic once construction of the new airport is
completed.

During 2023, FCC Industrial was awarded the
following contacts in Spain:

“Tagus 380” 380 MW PV plant (Cáceres).

EPC contract for a 263 MW PV plant in Guillena
(Seville).

Evacuation infrastructure, high-voltage line and
substations, Guillena PV plant (Seville).

Awarded

In progress

Completed

Urban development of Los Berrocales, Madrid (Spain).

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Lifting substation in Caparacena (Granada).

Maintenance of Iberdrola Electrical Networks.

Lifting substation in Terrer (Zaragoza).

Track and catenary for the Valladolid Eastern
Rail Bypass.

Project and renovation work on the railway
signalling on the Villanueva–Brazatortas line.

Heating plant of the Virgen del Rocío Hospital
(Seville).

Photovoltaic installation in the Alfés pool
(Lérida).

Main projects in execution

Spain

Electromechanical installations in the Santiago
Bernabéu Stadium (Madrid).

Electromechanical installations, Soria Hospital.

Electromechanical Installations in Puertollano
Hospital (Ciudad Real).

Refurbishment of the cold production plant
and the heating plant at the Virgen del Rocío
University Hospital (Seville).

Renovation of air conditioning installations and
energy improvement at the Teatro Real (Madrid).

Installation of air conditioning in the Valencia
University Clinical Hospital.

Electromechanical installations at the Civil Guard
Headquarters (Zaragoza).

176 MW PV plant, Velilla (Palencia).

227 MWp PV plant, Cedillo (Cáceres).

Maintenance of street lighting in the centre of
Madrid.

Fuentes de la Alcarria PV plant substation
(Guadalajara).

Guillena PV plant substation (Seville).

Caparacena PV plant substation (Granada).

Renovation of catenary on the Girona-Figueres
line (Gerona).

Renovation of catenary at the Cabezón de
Pisuerga station (Valladolid).

Execution of the energy, telecommunications
and signalling works on lines R2 and R4,
Rodalies (Barcelona).

Execution of the energy, telecommunications
and signalling works on the Bobadilla (Granada)
to Ronda (Málaga) and Zafra (Badajoz) to Huelva
sections of the ADIF rail network.

International

Electromechanical Installations Riyadh metro,
Riyadh (Saudi Arabia).

Energy-from-waste plant in Drumgray, Scotland
(UK).

New fuel storage and aviation fuel storage tanks
at Lima Airport (Peru).

Fuel storage tanks and industrial installations
at Lima International Airport (Peru).

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Maintenance and conservation

Maintenance of motorways, highways,
roads

The company works to maintain more
than 1,300 kilometres of motorways and
3,000 kilometres of conventional highways
belonging to a number of public administrations
(MITMA Ministry of Transport & Sustainable
Mobility), the Regional Government of
Extremadura, the Provincial Council of Gipuzkoa,
the Provincial Council of Palencia, the Metropolitan
Area of Barcelona, the Council of Grand Canary,
SEITT (state infrastructure and transport body) and
AUCONSA.

Within this network, we would point to the
operation and exploitation of more than
20 kilometres of tunnels, most notably the
Somport International Tunnel between Spain
and France for the MITMA and the Rondes de
Barcelona tunnels for the Metropolitan Area of
Barcelona.

In 2023, we continued to provide service
under maintenance contracts for a total of
20 administrations, and the following new
contracts were obtained in Spain:

Conservation and exploitation of highways, their
functional elements and other public services
and of minor works relating to these services in
Sector: VA-02, Province of Valladolid.

51-OR-0205; 30.458/23; Conservation and
exploitation of highways and minor works
relating to these services in Sector: OR-02,
Province of Ourense.

51-LU-0205; 30.427/23; Conservation and
exploitation of highways and minor works
relating to these services in Sector: LU-02,
Province of Lugo. All these for the Ministry of
Transport and Sustainable Mobility (MITMA).

Works to repair/improve bridges on the B-10
coastal road over the C-31 in Sant Adrià de
Besòs. Metropolitan Area of Barcelona.

Renovation of the maintenance and operation
contract for the highways of the Guipúzcoa
“preferential and basic interest network”.

Maintenance services for the provincial network
of highways of the Provincial Council of Huelva,
Lots North and South.

Maintenance of roads for city councils

During 2023, we continued to perform
maintenance services for the roads of the city of
Huelva.

Maintenance of road surfaces

During 2023 we started work on the road surface
maintenance contract for the Madrid Autonomous
Region, zone 3, with the Áridos de Melo Group as
our main subcontractor.

Maintenance of transport
systems

Maintenance of the Zaragoza and Murcia
tramways.

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Matinsa. Road conservation works.

226

Port infrastructure maintenance

Execution of a service contract with the Port
Authority of Malaga for the conservation and
maintenance of Malaga Port.

Maintenance and development of the
infrastructure included in the hydrological
control network of the Catalan Water Agency.
Lot 2. Low and medium availability control
points.

Hydraulic infrastructure maintenance

Work started on the following in 2023:

Continuing, furthermore, with the following
contracts in the Area of hydraulic infrastructure for
various water boards:

Maintenance of operating systems at the
Mijares-Plana de Castellón and Cenia-
Maestrazgo dams for the Júcar Water Board.

Exploitation, operation and maintenance of the
Automated Hydrological Information Systems
(AHIS) - 2 lots (Ebro and Júcar Water Boards).
Lot 1: Júcar AHIS.

Repair of the inside of the box beams of the
taintor gates for water level control of the
García de Sola dam, Badajoz, for the Guadiana
Water Board.

Operation, maintenance and conservation of
the Cancho del Fresno, Ruecas, Sierra Brava,
Gargáligas, Cubilar, Azud de Ruecas, Alcollarín
and Búrdalo dams, Cáceres

Operation, maintenance and conservation of
dams in zone 3 of the middle basin of the River
Guadiana.

Improvements to the state of existing canals in
irrigable areas of general interest to the state in
the Guadiana water board ‘s area, to promote

savings, efficiency and sustainability in the use
of water resources. Lot: 3. Operation of zones
6 and 7.

Conservation and maintenance of the Tajo-
Segura post-transfer system channels, Murcia,
Alicante and Almería. Lot 3 Campo de Cartagena
and Pedrera channels and sections II and III of
the left bank channel basin, Murcia and Alicante.

Management of emergency
and forest fire services

The provision of the fire prevention service for the
Provincial Fire Brigade of the Region of Castellón
has continued.

This past year we started the prevention and
extinction of forest fire service for the Autonomous
region of Castilla y León with units composed of
fire-fighters and fire engines.

Environmental services

We were awarded the contract for the
comprehensive conservation of municipal parks
and gardens - lot 6- Casa de Campo and Tres
Cantos for the Madrid Municipality, starting in
2024.

The provision of the following services has also
continued:

Control of vegetation in the area surrounding the
overhead electrical lines in western and southern
Madrid for Iberdrola.

Management of recycling points in National
Heritage historical gardens.

Silvo-pastoral plan for the Riofrío forest in
San Ildefonso, Segovia.

Alcañiz Hospital, Teruel (Spain).

Conservation of Manzanares River where it
passes through the municipality of Madrid.

Environmental conservation of La Herrería
Forest in the municipality of El Escorial, Madrid,
for National Heritage.

Control and reduction of the Argentine parrot
and Kramer parrot population in the municipality
of Madrid.

Execution of the works associated with the
competences of the General Directorate for
Water Management and Green Areas of Madrid.

Maintenance and conservation service for the
Castilla Canal for the water board.

Environmental works

Construction works

The following works were executed in 2023:

Bringing into conformity with Royal Decree
635/2006 of 26 May on minimum safety
requirements in tunnels of loma de Bas
and Sierra del Aguilón tunnels on the AP-7
Cartagena-Vera motorway for SEITT.

Repair of damage caused by heavy rains in
December 2022 for the Demarcation of State
Highways in Extremadura (MITMA by its
Spanish acronym).

Rehabilitation and commissioning of the
Santomera intermediate reservoir dam, Murcia.
Lot 1 for the Segura water board.

Conditioning of several sections of the EuroVelo
I and Dehesas de Sierra Morena cycling routes
where they pass through the Sierra de Aracena
and Picos de Aroche and Sierra Norte natural
parks in the province of Seville.

Urgent repair of storm Efrain damage to the
hydraulic infrastructure of the Vegas Bajas
aquatic ecosystem of the Guadiana, Badajoz
and other municipalities, for the Guadiana water
board.

Improvement of containment systems on the
structures of overpasses of the N-603, province
of Segovia, for the Demarcation of State
Highways in Eastern Castilla y León (MITMA).

Repair of structural damage and restoration of
the middle containment system on the bridges
of the AP-7, Valencia, for the Demarcation of
State Highways in Valencia (MITMA).

Green corridor and landscaping of unused
spaces in Isla Verde Exterior South, Port of
Algeciras, Cádiz.

Footpath between Las Redes and Vistahermosa,
Puerto de Santa María, Cádiz, for the
Demarcation of Cádiz Coasts.

Restoration of a mid-section of the River
Guadiana near Villagonzalo, Badajoz, Phase I,
as part of the Recovery, Transformation and
Resilience Plan (PRTR).

Handling of vegetation and forestry procedures
in hills overlooking reservoirs in the Autonomous
Region of Madrid; HIDROFOREST project.

Restoration and consolidation of shoulders,
drainage and containment and stabilisation of
embankments on several sections of the A-15,
SO-20, N-111, N-122, N-234 and A-11 highways,
for the repair of damage caused by the heavy
rains of 21 June 2023, province of Soria,
remedying the seriously dangerous situation
that had arisen. Sector SO-2 for the Demarcation
of State Highways in Eastern Castilla y León
(MITMA).

We were also awarded the following two contracts:

Bringing the Ortega Prados, Casabermeja 1,
2, 3 and 4 tunnels into line with Royal Decree
635/2006. Province of Málaga. Recovery,
Transformation and Resilience Plan financed by
the European Union Next Generation EU.

Energy saving and efficiency actions in the
Folgoso Tunnel. A-52 motorway, between
Km. 277.6 and 281.9 Municipality of A
Cañiza. Province of Pontevedra. Recovery,
Transformation and Resilience Plan financed by
the European Union Next Generation EU.

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Railway sections (Romania).

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at the highest level

3_
Strategy and
value creation

FCC in 2023

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Prefabricated construction

In 2023, Prefabricados Delta's factories produced:

More than 24 kilometres of concrete pipe with
steel jacket.

130,000 concrete sleepers of various types.

For the whole year 2023 Prefabricados Delta
contracted more than €42 million. The biggest
contracts by activity sector were as follows:

Supplies for hydraulic conduits

Spain

Irrigation network for the transformation into
irrigated land of the irrigable zone of the River
Aranzuelo, Burgos, Phase II on the part of the
Agrarian Technological Institute of Castilla-
León.

Improvements to the state of existing canals
in irrigable areas of general interest to the
state in the Guadiana water board area, to
promote savings, efficiency and sustainability
in the use of water resources.

Projects to transform Sector III into irrigated
land in the irrigable zone of the Centre of
Extremadura.

Supply of post-stressed concrete piping with
sheet metal sleeves for “Valdurrios piping
and electrification of pumping stations in the

irrigable zone of Sector VIII of Monegros II,
Bujaraloz and Peñalba”.

Supply of post-stressed concrete piping for
Barrax Pumping Station, Albacete.

Project for the execution of a central
command pool for the modernisation of
the irrigation of the Molinar del Flumen
community of irrigators.

Protect to transfer water through pipes for
the second phase of the replacement of
pumps in the East of La Mancha, irrigable
zone of the Canal del Picazo (La Grajuela).

Project to transfer water through pipes for
the second phase of the replacement of
pumps in the East of La Mancha (Canal de
Fuensanta).

Supply of post-stressed concrete piping
with DN 2400 mm sheet metal sleeves
for “Valdurrios piping and electrification of
pumping stations in the irrigable zone of
Sector VIII of Monegros II (Bujaraloz and
Peñalba)”.

Supply of piping and special parts for the
Sant Joan D´Espi drinking water treatment
plant.

International

Supply of reinforced concrete piping and
special parts with steel sleeves for the
Combined Cycle Power Plant in Belgium.

Supply of concrete piping of Prefabricados Delta.

Awarded

In progress

Completed

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Award of the contract for the supply and
installation of Stellantis’ new internal corporate
image (including furniture) throughout Spain,
Portugal and Italy.

Design and development of the corporate image
of the new “PIVOT” concept of electric service
station for BP at European level.

Design and development of the corporate image
of the new Lutterworth concept of service
station for lorries, for BP at European level.

Design of marquees and tentsfor newly
cpnstructed BP stations throughout Europe.

Design, supply and installation of the new store
concept of the Wild Bean Café image for BP’s
service stations in Spain.

Award of the design, manufacture and
installation of MG’s new corporate image in
Spain.

International

Implementation of the new corporate image of
Renault Europe in Spain, Portugal and Italy with
restyling of the 2022 image, including the new
Renaulution 2022 Logo.

Implementation of the new corporate image for
the Dacia dealership network in Spain, Portugal
and Italy, as well as the new logo, Dacia Link.

Supply of the new Nissan logo for Europe.

Implementation of the image restyling project
for Nissan Europe in dealerships in Spain, Italy
and Portugal.

Supply of image elements for BP's service
stations in Europe, with more than 350
operations in the United Kingdom and 323 in
Spain, including service station maintenance,
and 80 in Portugal.

Design and manufacture of BP’s first marquee
for electrical outlets at the HQ of Castrol in
Pangbourne, UK.

Award of contract by Stellantis, a brand that
encompasses Opel, Citröen, Peugeot, Fiat,
Alfa Romeo and Abarth, for the supply and
installation of its exernal corporate image at akll
dealers in Spain, Portugal and Italy.

BP corporate image at Europe.

Infrastructure | Activity of the Infrastructure Area | Page 17 of 19

Supply for railway contracts

Supply and transport of sleepers for the
complete renewal of infrastructure and track
in the Calañas-Peguerilla section of the
Zafra-Huelva line.

Supply and transport of sleepers for the
comprehensive renovation of infrastructure
and track of the Jabugo section of the
Zafra-Huelva line.

Supply and transport of sleepers for the
complete renewal of infrastructure and track
of the Calañas section of the Zafra-Huelva
line.

Supply and transport of sleepers for
concrete slab and transition zones for the
comprehensive renovation of infrastructure
and track of the Zafra-Huelva line.

Supply and transport of sleepers for the
complete replacement of bi-block by
monoblock sleepers on various sections of
the Seville-Huelva line, lots 1, 2 and 3.

Corporate image

Spain

Award of the design, manufacture and
installation of Renault’s new corporate image for
the Valladolid and Palencia factories.

Design, supply and installation at 100 KIA
dealers of KIA’s external and internal corporate
image in Spain.

Awarded

In progress

Completed

Infrastructure | Activity of the Infrastructure Area | Page 18 of 19

Concessions

In 2023, the recovery in demand was consolidated
thanks to the deactivation of measures aimed at
reducing mobility, in awards related to:

Urban public transport, such as the Murcia
Tramway and the Zaragoza Tramway, where
the number of passengers has recovered. In
the former case, data were 28.5% above pre-
pandemic levels in 2019, and in the latter, they
returned to 99%.

Road transport, including Ibiza-San Antonio
motorway and Conquense motorway
concessions, which have seen volumes of traffic
maintained in 2023, equalling the traffic levels
recorded in 2022.

Enlargement of the A-465 trunk road (UK).

The leasing of office space and catering
facilities, such as WTCB, where work started
on remodelling communal areas of the complex
with a view to the holding of Copa América in the
summer of 2024.

Ibiza - San Antonio motorway, Spain (50%
FCC): the contract lasts for 25 years and ends
in August 2032. The length of the concession
is 14 kilometres with a 600-metre tunnel. The
payment mechanism is a shadow toll.

Roads

Conquense motorway, Spain (100% FCC): a
136-kilometre shadow toll concession with a
duration of 19 years, ending in December 2026.
It is part of the first generation motorway plan
promoted by the Ministry of Public Works in
2007.

Underwater tunnel in Coatzacoalcos, Mexico
(85% FCC): the concession lasts for 45 years
until 2062. The design and delivery of the
underwater tunnel is the first construction of
this type in Mexico and also the first in Latin
America.

A-465 dual carriageway, Heads of the Valleys
(42.5% FCC): contract for the construction,
financing, maintenance and operation of the
expansion of the 17.3-km stretch of the A-465
dual carriageway between Dowlais Top and
Hirwaun in Wales, United Kingdom. Currently
under construction, the contract runs until 2055.

Metro and Tramways

Murcia tramway, Spain (100% FCC): contract
awarded in 2009 for the construction and
operation until 2049 of line 1 of the Murcia
tramway. It has a fleet of 11 trams, 28 stops and
a total length of 18 kilometres.

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Murcia tramway (Spain).

231

Social

World Trade Centre Barcelona, S.A., Spain
(24% FCC): in December 2023, occupancy was
93.0% in premises and offices.

Haren Prison, Belgium (15% FCC): this
contract covers the design, construction and
maintenance for 25 years on a payment for
availability basis of a new prison complex in
Haren, near Brussels. 2023 was the first full year
of operation of the complex.

Ports

Port Torredembarra (20% FCC): concession
of a marina in Torredembarra, which after
its completion has been extended for a term
of 15 years until December 2037. With the
capital increase carried out to strengthen Port
Torredembarra’s equity, FCC increased its stake
by 20%. During 2023 we applied for permits
for the execution of the obligatory investment
commited to in the extension project.

Infrastructure | Activity of the Infrastructure Area | Page 19 of 19

Zaragoza tramway, Spain (16.60% FCC):
line 1 of the Zaragoza tramway consists
of 12.8 kilometres, 21 trams and 25 stops.
The tramways have a charging and energy
accumulation system to travel the 2-kilometre
section that runs through the historic centre.
The contract was awarded in 2009 and lasts for
35 years. In December 2023 two new tramway
units were incorporated; they should improve
operations during peak hours and increase
passenger capacity.

Maintenance of 13 stations on Barcelona’s
Metropolitan Line 9: the activities performed
during the operation phase mainly consist
of the maintenance of the infrastructure and
equipment built and installed. 2023 was the
eighth year of being open to the public and the
service worked normally.

Tranvía Metropolità del Besòs and Tranvía
Metropolità: FCC has minority stakes in
both Barcelona tram systems, which have a
combined route length of 29 kilometres and
58 stops.

Lima Metro Line 2, Peru (18.25% FCC): design,
financing, construction, electromechanical
equipping, systems equipment and provision of
rolling stock, operation and maintenance for a
period of 35 years until 2049 on a payment for
availability basis. In 2023, progress was made
on the metro construction works, and we passed
the milestone of completion of the execution
of the investments corresponding to phase 1A
consisting of 5 stations and 5 kilometres of
track, meaning that this section was able to go
into service on 21 December 2023.

Haren prison (Belgium).

Torredembarra port, Tarragona (Spain).

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

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Financial
Statements

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Infrastructure | Highlights Infrastructure 2023

3. Highlights Infrastructure 2023

January

March

May

July

September

November

February

April

June

August

October

December

_ FCC Construcción achieves a key milestone in the Major Bridge P·project in Pennsylvania (USA)._ FCC Construcción is certified by the National Security System (ENS) for its cybersecurity._ FCC Construcción wins the project to construct the new Son Dureta hospital complex in Mallorca (Islas Baleares, Spain)._ FCC Construcción and Samsung C&T Corporation sign a partnership agreement to work together on international infrastructure projects._ FCC Industrial wins the contract to develop a large regasification plant in Germany._ FCC Construcción publishes its Strategy for Combating Climate Change 2023-2026._ FCC Construcción wins the contract to construct the A-73 Burgos-Santander motorway and the Baix Llobregat motorway in Catalonia (Spain)._ FCC, third Spanish construction company worldwide according to Deloitte’s Global Powers of Construction (GPoC)._ FCC Industrial wins the contract to construct its first floating PV plant in Spain._ FCC Construcción wins the contract to construct the Rubi Line, Casa da Música-Santo Ovídio, of the Oporto Metro (Portugal)._ FCC Construcción wins the contract to construct the PALLAS modern nuclear reactor for medicinal uses (Netherlands)._ FCC Construcción’s Neom tunnel project reaches three kilometres of drilling (Saudi Arabia)._ FCC Construcción continues to grow in Romania with two new railway contracts._ FCC Construcción accedes to REDI, the Business Network for Diversity and LGBTI Inclusion._ FCC Construcción publishes its GHG emission report for 2022._ FCC Construcción wins the contract for the extension of the Fira de Barcelona (Spain)._ FCC Construcción obtains the CO2 Performance Ladder Certificate, Level 5._FCC Construcción Chile completes the second section of the Parque Mapocho Río, the biggest urban environmental regeneration project in Chile._FCC Construcción Australia and Martinus sign an MoU on working together on railway infrastructure projects._FCC Construcción starts work on the new institutional HQ of the ONCE Social Group in Madrid (Spain)._FCC Construcción wins more than €670 million worth of infrastructure contracts in Spain._FCC Industrial and TotalEnergies start work on the project to build five PV plants in Spain._FCC Construcción completes the excavation of the longest and deepest tunnel in Latin America, the Guillermo Gaviria Tunnel (Colombia)._Convensa wins the contract for the complete modernisation of the Madrid-Seville high-speed railway line (Spain)._FCC Construcción’s Concepción Industrial Bridge project passes the 50% complete (Chile)._FCC Construcción publishes the 2023 Environmental Communication report and updates its 2022 Sustainability Report._FCC Construcción completes a section of Lima’s first underground metro (Peru)._FCC Construcción and Aqualia complete the project to remodel and extend the Glina waste-water treatment plant (Bucharest, Romania)._ The Sotra Link Consortium, of which FCC Construcción forms part, starts construction of the Sotra Connection project, the largest suspension bridge built digitally (Norway)._ FCC Construcción attends the United Nations’ Climate Change Conference._ FCC Construcción wins the contract to bury the train track in Montcada (Catalonia, Spain)._ FCC Construcción recognised in the XVI Spanish Biennial of Architecture and Urbanism for its remodelling of Plaza de España and its surroundings (Madrid, Spain).Infrastructure | Sustainability and excellence | Page 1 of 3

4. Sustainability and excellence

233

4.1.
Sustainability

Aligned with the SDGs

The United Nations 2030 Agenda is a clear and
shared path to eradicate poverty and promote
sustainable and equal development between
2016-2030. For this reason FCC Construcción has
incorporated the Sustainable Development Goals
(SDGs) into its activity and its value creaction
model.

This commitment finds concrete expression in
its Sustainability Strategy 2023-2026, approved
by the Sustainability Committee in 2023, with
long- (2050), medium- (2030) and short- (2026)
term objectives, linked both directly and indirectly
to the attainment of the SDGs. To prepare this

Strategy, an evaluation was first carried out of
the company’s impact on the targets of the SDGs
in order to identify the areas and ways in which
the company could have greater influence on
their attainment and thus direct its efforts more
effectively.

Moreover, as a new feature in 2023,
FCC Construcción became the only construction
company on the United Nations Financial
Innovation Platform to Support SDGs and, as part
of its commitment to adopt the four principles
of sustainable finance, it has developed a novel
tool that allows the sustainable investment made
by the company to be lined to the SDGs, making
it possible for the organisation to ascertain
rigorously its economic impact on sustainable
development.

We should also like to highlight the CEO of
FCC Construcción’s commitment to the SDGs,
which constitutes a new, united and responsible

approach from which companies can, and should,
contribute to the creation of a more sustainable
world and the dissemination and training of
employees on SDGs with training sessions,
courses and awareness campaigns.

Sustainable construction

FCC Construcción believes that the achievements
reached and processes developed should be the
normal behaviour and part of the culture of the
construction sector worldwide and that it in turn
must provide the community with the knowledge
and criteria acquired which is why it participates
and leads multiple forums and national and
international technical committees.

Some of the most relevant organisations with
which FCC Construcción partners in setting
sustainability criteria related to construction
are: the International Standardization Technical

Committee ISO/TC59/SC17, “Sustainability in
Building Construction”, the European Committee
CEN TC350 “Sustainability of Construction Works”,
the International Technical Committee ISO/TC207
“Environmental Management”, the Scientific-
Technical Association of Structural Concrete,
the Technical Association of Ports and Coasts-
PIANC, the National and International Committee
of Large Dams (ICOLD and SPANCOLD), the
Corporate Responsibility Committee of the EIC
or the SEOPAN Quality, Environment and R&D
Committees, among others.

Apart from this, FCC Construcción was a pioneer in
developing its own methodology for evaluating the
sustainability of its civil engineering projects,
SAMCEW, thus contributing to the adoption of
measures that increase the sustainability of its
works.

Environmental management

Commitment to climate change

FCC Construcción has an Environmental
Management System, certified according to
ISO 14001, which covers almost 100% of its
activity.

The company has also implemented a Best
Practices® system, on top of legislative or
contractual requirements or those from any other
source, and actions that guarantee improved
environmental results. The system is made up
of a series of measures performed voluntarily
by the FCC Construcción projects, so that these
measures establish more ambitious environmental
objectives than those established by the applicable
environmental legislation or the requirements of
customers or third parties. The application of these
Best Practices has the end goal of preventing
or minimising the environmental impacts of the
projects and enhancing the benefits of certain
actions carried out during their execution.

In the Environmental Dimension of the 2023-2026
Sustainability Strategy, FCC Construcción has
set itself the objective, for 2026, of extending the
System of Best Practices to increase its reach and
reduce its environmental impact, and as the main
new feature it is also working on calculating the
Water Footprint with the dual objective of better
managing this resource and increasing its rate of
re-use.

Aware as it is of the fact that climate change will
pose one of the biggest challenges to humanity,
FCC Construcción has published its Climate
Change Strategy, as part of the Sustainability
Strategy, developed under the recommendations
of the Task Force on Climate-related Financial
Disclosures (TCFD). It incorporates the necessary
measures by means of three strategic lines –
mitigation and governance of and adaptation to
climate change – aimed at both attaining the goal
of zero emissions in 2050 and becoming a resilient
company.

FCC Construcción has been integrating climate
change management into its activities for years;
thus in 2010 it became the first construction
company in Spain to verify its GHG emissions,
and has since verified them annually. In addition,
since 2012, FCC Construcción has held the AENOR
"Environment CO2 verified" carbon footprint
certificate.

It was the first construction company to register
its carbon footprint in the “Register of carbon
footprint, offset and CO2 absorption projects"
of the Ministry for Ecological Transition and the
Demographic Challenge, which has given us the
"calculate and reduce" stamp in recent years.

234

In 2023, for the third year running, AENOR verified
or GHG emissions for the past financial year for
100% of the business, under the ISO 14064-1:2018
standard.

Furthermore, in 2023, AENOR also verified the GHG
emissions of associates in the Infrastructure Area,
FCC Industrial and Matinsa, under the ISO 14064-
1:2018 standard.

Circular economy

At FCC Construcción, the circular economy
represents a fundamental line of action for
reducing the impact of our activity on the
environment, improving the efficiency of productive
activities, extending the life and optimising the use
of the resources we use and minimising the waste
we generate.

In 2017, FCC Construcción structured its progress
towards the circular economy around the
Ellen MacArthur Foundation's ReSOLVE framework
and in 2018 it signed up to the Pact for a Circular
Economy, promoted by the Spanish Ministries of
Environment and Economy. In 2019, FCC Industrial
obtained the “Zero Waste” waste management
system certificate, granted by AENOR, and in
2023 it worked to implement this system in more
works and fixed centres and to create a universally
applicable system such as can be integrated
into the company’s way of acting n its day-to-day
dealings, thus ensuring greater recovery of waste
and a reduction in the amount of waste destined
for incineration without recovery or dumping on
landfill.

This constitutes one of the objectives of
the strategic line Circular Economy of
FCC Construcción’s 2023-2026 Sustainability
Strategy.

Matinsa. Keeping roads open and safe in winter.

235

Infrastructure | Sustainability and excellence | Page 3 of 3

4.2.
Quality

Service excellence

The participation of FCC Construcción in any
infrastructure project means contributing the
experience of a company with over 120 years in
the sector, with great technical ability and a firm
commitment to efficiently overcoming challenges.
This all comes with absolute respect for the
environment, while promoting development and
innovation through the use of the best construction
techniques.

In its work, FCC Construcción creates value for
society and for its shareholders, providing the
management and services required to design,
build and operate infrastructure and services that
efficiently, sustainably and safely contribute to the
well-being of people. In this respect, the company
contributes solutions aimed at improving society,
sustainable development and the well-being of
citizens.

In line with its objective of continuous
improvement, to get recognition by stakeholders
and give greater confidence to its clients,
FCC Construcción maintains its AENOR Quality
System certificate for practically 100% of its
business.

Customer satisfaction

FCC Construcción’s priority is to meet the needs
of its clients, with the commitment to fulfil their
requirements with quality guaranteed. The main
objective is excellence in the performance of the
work by providing personalised attention and
ongoing dedication, always focusing on fulfilling
their expectations.

Every year, our customers evaluate the
performance of FCC Construcción. According
to the results of the surveys, the most valued
attributes are the professional abilities of the
construction team, consideration of customers’
instructions and the ability to deal with problems
and unexpected events that arise in projects.
These assessments hold steady at very high levels
year after year. In fact, the aspect most highly
valued by our customers, “professional abilities of
the construction team”, reaches a score of 9.7 out
of 10, showing the high level of satisfaction of our
customers with our teams.

These excellent results enable us to state that the
stringency and quality of FCC Construcción are
factors that set us apart from the competition.

The average score in the satisfaction surveys
undertaken in 2023 is 9/10, i.e. outstanding. This
assessment holds steady at very high levels over
the years, showing FCC’s commitment to all its
customers in each of its projects.

Some comments
from our customers in 2023

_ “We note in particular the company’s
commitment to the correct execution of the
project, even during the period when the
country came to a standstill due to COVID-19,
ultimately meeting objectives and deadlines”.

Knowledge management

FCC Construcción is distinguished by knowledge
and experience endorsed by success in a wide
range of projects and works. This strength,
which is appreciated by our customers, has been
confirmed by the implementation of a knowledge
management system and the tools that optimise it.

The purpose of knowledge management is to learn
from past experience and improve future actions,
based on the knowledge stored up in the company.

_ “Work carried out to the entire satisfaction
of the Administration”.

Awards

_ “The attitude of FCC personnel was at all
times exemplary and very professional”.

_ “Excellent team in both the technical and
human senses. Looking forwards to working
together again on another development”.

Awards obtained in 2023.

Management pioneers

The Management and Sustainability System
at FCC Construcción is a dynamic system
that constantly adapts to the new challenges
and processes required by the market.
FCC Construcción has always been a pioneer
in implementing new developments and
management systems.

In order to demonstrate compliance to third parties
and greater transparency in its management, the
company has its Management and Sustainability
System certified by an accredited external
agency.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsFCC. Annual Report 20234_

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

236

5.1.
National R+D+i proyects

During 2023, work has been done mainly on the
following projects:

FCC Construcción

Megaplas

Infrastructure | Innovation & technology | Page 1 of 2

5. Innovation
& technology

FCC Construcción promotes an active
technological development policy, with a firm
commitment to research, sustainability and
contribution to the quality of life of society as
a differentiating factor in the current, highly
competitive and internationalised market. The
development and use of innovative technologies
to carry out the works additionally involves an
intrinsic added value for the company.

As part of its activity, FCC Construcción and
its investee companies develop projects in
conjunction with other companies in the industry,
often with technology-driven SMEs, which makes it
possible to perform open innovation projects with
a participation in the value chain and, occasionally,
on a horizontal cooperation basis.

Matinsa

FCC Industrial

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

237

Infrastructure | Innovation & technology | Page 2 of 2

5.2.
International R+D+i projects

Internationally, FCC Construcción is coordinating
the DigiChecks Project, part of the new Horizon
Europe programme (2021-2027):

FCC Construcción, due to its solid position in the
market and having a competitive advantage in the
sector, uses the different available mechanisms to
protect industrial and intellectual property in the
processes it deems strategic.

In 2023, the protection was performed in the
following processes:

Owner: FCC Construcción

Owners: CONVENSA (50%) and FCC Construcción (50%)

TechnicalInnovationin UndergroundConstructionGrantagreementNº IP 011817-2Digital Environmentformanagementofpermitsand compliancein buildingand constructionGrant agreementNº1010585411_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

238

Cement

1. Products _ 240

2. Industry analysis _ 241

3. Group activities by country and business line _ 242

4. Highlights Cement 2023 _ 244

5. Relevant events in 2023 _ 245

6. Environment. Energy transition and climate change _ 245

7. Research and development _ 246

8. Service excellence _ 246

9. Performance _ 247

10. Equality _ 247

11. Health and safety _ 248

12. Training _ 248

The Cementos Portland Valderrivas Group
is a multinational company with a presence on
three continents and is the national cement
leader in Spain. Its production capacity exceeds
10 million tons of cement per year

FCC in 2023

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A1_
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Statements

A2_
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Report

FCC. Annual Report 2023

239

Cement

The Cementos Portland Valderrivas Group (GCPV)
is a Spanish multinational company specialising
in the production of cement, concrete, aggregates
and mortar. Throughout the 121 years since its
establishment in 1903, the Group has always
evolved to adapt to the changing needs of society
and of the markets, using advanced technology in
all its processes to optimise manufacturing while
at the same time complying with environmental
regulations. In all its actions, the Group
demonstrates its commitment to sustainability.

In Spain, GCPV has seven strategically located
factories covering most of the peninsular including
the North, East, Centre and South, and three of
the country's major cities (Madrid, Barcelona and
Seville).

Outside Spain, the Group is a leader in the cement
industry of Tunisia, where it has a factory with an
annual production capacity of 2 million metric tons,
making it one of the main producers of cement not
just in the country but in the whole of the Maghreb.
In the United Kingdom, GCPV operates through
two import terminals, Dragon Portland and Dragon
Alfa. The Group also carries out its cement and
clinker trading activity from the Netherlands.

Mataporquera Factory, Cantabria (Spain).

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creationCement | Products

1. Products

1.1.
Cement

The different qualities of cement are obtained
by adding materials such as limestone, fly ash,
pozzolans, etc. to obtain specific characteristics
for their use.

1.4.
Aggregates

Portland cement is obtained by mixing, in the
correct proportions, raw materials, finely grinding
them and heating them until they start to merge,
creating clinker. This process is performed in rotary
furnaces.

1.2.
Concrete

When the clinker cools, it is mixed with a small
amount of plaster that regulates the setting
process, and after grinding it, Portland cement is
obtained, thus rounding off the production process.

Concrete is a calcareous conglomerate generally
used as a structural element in construction;
it is obtained by mixing materials like cement,
aggregates and other additives with water, in the
correct proportions, depending on the purpose
for which the concrete is to be used and the
environmental conditions in the place where it is to
be employed.

1.3.
Mortar

This is a mix of conglomerate, sand and additives
used in construction either to hold elements
together or on top of a base layer, to cover,
waterproof or finish construction works.

Aggregates are defined as mineral materials, inert
granular solids that, with the appropriate particle
size and characteristics, and in accordance with
regulatory specifications, are used to manufacture
resistant artificial products by adding hydraulic
conglomerates or bituminous binders.

They have multiple uses, including applications
for concrete, roads, ripraps or breakwaters and as
raw materials for industry such as cements, filters
and micronised materials. They are also used as
asphaltic agglomerate or cold-applied asphalt,
among other things. Aggregates are obtained by
means of mechanical extraction of loose sand
and gravel, or by blasting and crushing where
consolidated rocks are concerned.

These materials are transported to plants to be
classified, washed and selected.

Sleepers made from CEM I 42,5 R-SR 0 cement.

2. Industry analysis

2.1.
Spain

In recent months, the Spanish cement industry has
seen a slowdown in consumption, with negative
growth rates since September 2023. In parallel with
this, exports have declined slightly so far this year,
while imports have fallen by more than 40%.

In December 2023, the Bank of Spain, the central
bank, revised GDP growth for 2023 upwards
slightly to 2.4%. For 2024 it is forecasting growth
of 1.6% and an unemployment rate of 11.7% with
inflation at 3.3%, the latter affected by movements
in energy prices. Energy prices are expected to pick
up at the beginning of 2024 and subsequently to
moderate, although remaining above pre-pandemic
levels. The most likely scenario for commodity
prices is that they will behave like the futures
markets, which, for gas and oil, are on a downward
trajectory. With these data we can conclude that
the pace of growth of the Spanish economy is
slowing.

The Association of Construction Companies
and Infrastructure Concessionaires (SEOPAN)
estimated that public sector works put out to
tender YTD November 2023 increased by 1.9%
compared to the same period in 2022. For
civil engineering they were up by 3.5% but for
construction they were down by 1%. Building
permits issued were up by 2% on 2022, totalling
111,000 homes and for 2024 growth is expected
to continue, to reach 116,000 units. Non-residential
construction was down by 20% in 2023. It is
expected to stabilise in 2024. As for investment
in infrastructure in 2024, it could be affected
by budgetary restrictions resulting from the
reactivation of European Union (EU) deficit rules.

According to data of Oficemen, the industry
employers’ association, consumption of cement
in 2023 fell by 3% to 14.5 million metric tons, and
according to its estimates, made in October, this
volume will be maintained in 2024.

In 2023, sales of GCPV’s Spanish Business Unit
reached 4.3 million metric tons of cement and
clinker, domestic and export sales together, the
same volume as in 2022.

241

2.2.
Tunisia

In Tunisia in 2023, the domestic market reached
5 million metric tons, 9% less than in 2022.
According to the Group’s estimates, for 2024
domestic consumption is expected to fall by
around 4% relative to 2023.

Tunisia has been going through an economic,
social and political crisis in the past few years.
Inflation and the devaluation of the Tunisian dinar
have seriously affected the country’s economy,
which now faces shortages of basic products
and high rates of unemployment, especially youth
unemployment. Every year the country has to
request more loans to balance its budget and pay
its prior debts, but in the end this funding will be
made conditional upon the implementation of
structural reforms.

In 2023, sales of GCPV’s Tunisian Business Unit
reached 1.2 million metric tons of cement and
clinker, domestic and export sales together,
representing a decline of 12% relative to 2022. The
main countries to which it exports are Mexico,
Libya, Italy and the USA.

In this context, the Cementos Portland Valderrivas
Group will continue to pursue its policies of
optimisation of expenditure and investments and
adaptation of all its organisational structures to the
reality of the various markets in which it operates
in order to improve cash flow generation and
support sustainable development.

3. Group activities by country and business line

242

3.1.
Group sales

The volume of cement and clinker sold in 2023
reached 5.7 million metric tons, 2% down on 2022.

Distribution of activity by country

5.7

million tons
Volume
of sales

15%

10%

13%

12%

15%

2023

2022

In 2023,
international sales
accounted for
38% of billing,
similar to 2022

62%

12%

61%

Spain

Tunisia

United Kingdom

Other

Group sales

Distribution of activity by businesses

Cement (t M)

Concrete (m3 k)

5.8

5.7

289

247

Aggregate (t k)
1,062

Mortar (t k)

279

1,034

269

-0.1
(-2%)

+42
(+17%)

-28
(-3%)

+10
(+4%)

2023

2022

92%

2022

2023

2022

2023

2022

2023

2022

2023

Cement

Cement, mortar and aggregate

The product mix
has remained very
stable compared to
the previous year.
The cement business
accounts for
92% of revenue

3.2.
Turnover

Turnover in 2023 increased by 19% relative to 2022,
to €614.3 million.

In Spain, total invoicing increased by 18% to
€486 million, mainly due to positive price
movements and the satisfactory level of exports.

Turnover in Tunisia reached €83.8 million, holding
steady relative to 2022. In this case, slack demand
in the domestic and export markets was offset by
favourable price movements.

In the UK too, invoicing was up by 20%, at
€58.9 million thanks to the increase in prices which
offset the fall in demand.

3.3.
Gross operating
profit/(loss)

3.4.
Cash flow

Gross operating profit (Ebitda) amounted to €139.5
million, a noteworthy increase on the €30.3 million
of the previous financial year. This increase is
explained by the combined effect of the substantial
increase in income, underpinned by higher selling
prices, and the reduction in the cost of electrical
energy and fuels, especially in Spain. Consequently
the margin for the year stood at 22.7% as against
5.9% for the previous year.

In 2023, net cash flow generated from operations
amounted to 140.8 million euros, while the cash
flow from investments stood at -104 million euros.
This breaks down as:

Investments of -23.5 million euros made by
the Group for production and environmental
improvements in Tunisia and Spain and for
the construction of a new silo in the United
Kingdom.

€105.8 million contribution during 2023 by the
Group to the US$250 million capital increase of
Giant Cement Holding Inc., in which the Group
has a minority holding of 45%, with a view to
strengthening the financial structure of this US
subsidiary.

243

Less a €24.7 million settlement received during
the year in respect of the favourable resolution of a
dispute relating to land expropriation.

At 31 December 2023, net debt to third parties
stood at €136.2 million.

The average payment term for Spanish companies
is 51 days.

Ebitda

139.5

million euros

4. Highlights Cement 2023

FCC. Annual Report 2023

244

January

March

June

September

December

February

April

July

October

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report_ The Cementos Portland Valderrivas Group launches its campaign under the name “Safety is not negotiable” aimed at raising the awareness of all personnel of all kinds of work involving high risk and the attitude to adopt towards them._ The CPV Group celebrates International Women’s Day in all its centres under themotto “Todos Sumamos” (All Together)._ The Group collaborates to reverse the critical situation of the marbled duck in Europe, with the release of 20 specimens in the lakes of its property at El Porcal, Madrid Province, Spain._ Public authorities of Cantabria visitthe Cementos Portland Valderrivas Group’s facilities at the Port of Santander, Spain._ The company’s CEO presents the Principle of Conduct and Action forming the Business Culture of the Cementos Portland Valderrivas Group and the main thrust of which is “Driving Sustainable Progress”._ The Cementos Portland Valderrivas Group presents to the Municipality of Santa Margarida i els Monjos, Barcelona, Spain,the historic documentary archive of the old Freixa Cement and Lime factory, consisting of 62 documents of great heritage value,which were incorporated into the Municipal Archive._ Cementos Portland Valderrivas’ Alcalá de Guadaíra factory, near Seville, Spain, obtains ISO 50001 Energy Management System certification from AENOR, the Spanish standards authority._ The Cementos Portland Valderrivas Group launches the first edition of its corporate magazine “Portland Contigo” (Portland Next to You) in which the company’s main milestones and news items are shared._ The management team of Dragon Portland Ltd and Dragon Alfa Ltd, accompanied by their six best customers, visit the Mataporquera factory in Cantabria, Spain._ The Cementos Portland Valderrivas Group presents the Culture Awards to members of its personnel judged outstanding in terms of +Solidarity, +Greenness and +Communication._ Dragon Products Company, a subsidiary of Giant Cement Holding Inc., in which the Cementos Portland Valderrivas Group holds a 45% stake, announces the wind-down of operations of the furnace and the quarry at the Thomaston, Maine plant in the USA. Cement | Relevant events in 2023 _ Environment. Energy transition and climate change

245

5. Relevant
events in 2023

6. Environment.
Energy transition and climate change

During financial year 2023, Group company Giant
Cement Holding Inc. carried out a capital increase
in an amount of US$250 million in order to
strengthen its financial structure.

Cementos Portland Valderrivas subscribed fully
to the capital increase, contributing €105.8 million
and maintaining its holding at 45%.

The Cementos Portland Valderrivas Group is
determined to continue being a significant player in
the sector in which it operates, and is continuously
preparing itself to face the main challenges
confronting it in the medium and long term and to
identify new opportunities.

Reducing the use of materials with a high
impact on natural resources, replacing them
with alternative materials and fuels, allows us
to minimise the exhaustion of scarce resources,
which is a major objective of the circular economy.

Reducing CO2 emissions in the Group’s operations
is the main challenge to achieving alignment with
the objectives of adaptation to and mitigation of
climate change.

As regards operational investments, efforts are
focused mainly on optimising facilities, improving
the energy recovery capabilities of the furnaces,
with the aim of reducing the carbon footprint of
clinker.

Apart from this we are making intense efforts to
produce and sell cements with greater percentages
of supplementary materials that reduce the clinker
content without affecting performance. This will
allow us to reduce the carbon footprint of our main
product, cement.

During 2023, material recovery increased by
more than 3.1%, with greater use of secondary
raw materials as a proportion of the total of over
7.5 million metric tons of raw materials used.
The energy substitution percentage in the clinker
furnaces was 31%.

Water consumption was 512,068 m3, of which
32,932 m3 was recycled or re-used.

A notable milestone on the energy transition path
embarked upon by the Group was the certification
in 2023 of six cement factories under ISO 50001
Energy Management Systems. The establishment
of this standard motivates and orders efforts on
the path to improving energy performance, both
thermal and electric.

Lorry displaying the GCPV slogan “Pushing Sustainable Progress”, at the El Alto factory in Madrid (Spain).

Our products are available throughout the
territory thanks to our distribution network. We
offer a broad range of services, including sales
consultancy, technical-commercial advice, after-
sales services, product delivery, automatic loading,
24-hour loading service, urgent resolution of
incidents, digital account management and advice
on safety.

Some of our services are:

Commercial consulting service to focus on each
project with the best products.

Technical-commercial advice and technical
support.

After-sales services.

Delivery of product at destination.

Automatic loading in production centres.

24 hour loading service.

Urgent incident resolution.

Digital Account Management, through the Digital
Management Channel at www.valderrivas.es.

Advice on safety.

International sales with customer support and
advice.

At Cementos Portland Valderrivas Group we
believe that service is fundamental to our business.
Accordingly, we have established many different
ways of communicating with our stakeholders,
providing easy access to relevant information
and documentation with a view to building lasting
and satisfying relationships. Our customers are
an integral part of the history of the Cementos
Portland Valderrivas Group. Together with
them, we have faced the biggest architectural
challenges, developing ever more sustainable and
sophisticated products that drive the growth and
development of advanced societies.

Cement | Research & development _ Service excellence

7. Research
& development

The year 2023 saw the completion of the
“Evaluation of the geological storage potential for
CO2” project, in collaboration with the Geological
and Mining Institute of Spain and the Oficemen
group.

The main conclusions of the study were that
scenarios should be developed for the possible
deployment of CO2 capture, use and storage
(CCUS) technologies in the sector and their
potential and associated costs evaluated.

8. Service
excellence

The Cementos Portland Valderrivas Group focuses
on providing its customers with satisfactory
service. Our business principles include
individualised attention, continuous improvement,
high standards of quality and environmental
responsibility. These efforts have allowed us to
maintain a lead position in the markets in which
we operate and to be a trusted collaborator for the
main construction groups.

Control Room at the Alcalá de Guadaíra factory, Seville (Spain).

9. Performance

10. Equality

During 2023, GCPV’s workforce increased by
1.3% on average, to 1,074 persons.

The Cementos Portland Valderrivas Group
continues to work on diversity in the workforce,
applying both the equality policies in force and
the Equality Plan approved in 2022. Thanks to
this commitment, at the end of 2023 the number
of women with employment contracts in the
company was 6.36% higher than at year-end 2022.

As part of its commitment to safety in the
workplace, in 2023 the Group delivered 8,763 hours
of training on this subject.

True to its commitment to equality, in 2023 the
Cementos Portland Valderrivas Group appointed
women to positions that have traditionally been
entirely male, such as Shift Managers, Production
Control Room Operators, Forklift Operators,
Production Operatives and Dispatchers, all
these positions being directly related to factory
operations and hitherto basically done by men.

The workforce received training on this matter,
with both technical-normative and more social
content: Application of Laws on Equality, non-
Discrimination and the Safeguarding of Sexual
Freedoms; Gender-based Violence and Support
Networks; Unconscious Bias; Practical Equality
Workshop for teams; “knowledge pills” on
Inclusive Language; and training in the avoidance
of Bullying at Work and Sexual Harassment.

Campaigns were carried out to increase the
visibility of women with a STEM (Science,
Technology, Engineering and Mathematics) profile
who work in the company, and who also took
part in round tables, sharing their vision of the
organisation, with the objective of showcasing
women’s work and encouraging the inclusion of
more women in technical roles and functions in
the Group.

247

Head of Occupational Risk Prevention at the El Alto factory, Morata de Tajuña, Madrid (Spain).

11. Health
& Safety

The Portland Valderrivas Cement Group’s
Occupational Health and Safety Policy establishes
the commitment of ensuring its employees
enjoy healthy and safe working conditions. To
develop this Policy, action plans are prepared with
objectives based on continuous improvement. The
Health and Safety Management System – certified
in accordance with ISO 45001 and implemented

in all the Group's factories – makes it possible to
ensure that safety is effectively integrated into all
operations.

An outstanding feature of 2023 was the
awareness-raising and preventive culture
campaign carried out in all the Group’s facilities,
with more than 3,000 hours of training delivered.

As far as accident rates are concerned, there were
no fatalities or serious accidents in 2023 and the
lost-time accident frequency rate was 2.35 per
million hours worked, a 48% improvement on the
previous year and below the average for the past
five years.

248

12. Training

In 2023 the Group delivered 12,867 hours of
training, 8,763 of which (68.1%) concerned
Health, Safety and Well-Being, demonstrating the
company’s commitment to prevention and safety
as priorities for personnel training.

Furthermore, the company invested more than
1,000 hours of in-house training on digitisation
and modernisation. As part of FCC’s transversal
training strategy, GCPV carried out several training
programmes on Equality and Diversity for the
whole workforce with campaigns focusing on
the prevention and elimination of bullying at work
and the use of inclusive language reflecting the
diversity of our workforce.

GCPV’s “Walk or run?” poster to
encourage physical activity.

Training on Safety in the Mataporquera factory, Cantabria (Spain).

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

249

Real Estate

Development of spaces with an integral vision _ 250

1. Industry analysis _ 251

2. Activity in the Real Estate Area _ 255

3. Highlights Real Estate 2023 _ 263

4. Service excellence _ 264

5. Sustainability, innovation and technology _ 266

The Real Estate Area of the FCC Group comprises
FCC Inmobiliaria - which heads up and acts as holding
company for the area - and by the Realia Group, whose
parent company is a listed company, with more than
30 years’ experience, its corporate object being the
development, management and operation of all types
of real estate - and Jezzine Uno S.L.U.

Real Estate

Development of spaces with an integral vision

250

The Real Estate Area of the FCC Group comprises
FCC Inmobiliaria - which heads up and acts as
holding company for the area - and by the Realia
Group, whose parent company is a listed company,
with more than 30 years’ experience, its corporate
object being the development, management and
operation of all types of real estate -
and Jezzine Uno S.L.U.

The philosophy that guides the Real Estate activity
is the generation of value, both for customers,
through the offer of products and services adapted
to new habits and trends, and for shareholders,
through the maximisation of profitability.

The professionals who make up the Real Estate
team have extensive experience in the sector
and bring solid knowledge in all phases of
the production process and service provision,
combining two types of profiles, the experience of
the seniors and the digital knowledge and skills of
the new generations. In this way, it is possible to
carry out all productive activities with an integral,
dynamic and modern vision.

The commitment to innovation, sustainability
and social responsibility guides the design of the
spaces planned, built and managed, in seeking
to build a world that is increasingly respectful of
society and the environment.

1_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 2023DevelopmentBusinessInvestmentPropertyLandManagementLeasing and management of office buildings, commercial premises and shopping centres.Development and operation of projects aimed at housing rental.Development and sale of real estate products, mainly housing.Urban land management at different stages of urban development.1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

Real Estate | Industry analysis | Page 1 of 4

251

1. Industry analysis

(Sources consulted for the preparation of this
section: Sector analysis, CaixaBank Research 2023;
Colegio de Registradores (College of Registrars;
CBRE “Living” Report; Savills, “Office Pulse”;
Colliers Spain Office Report Madrid & Barcelona,
2023; Asociación Española de Centros y Parques
Comerciales (Spanish Association of Shopping
Centres and Retail Parks, (AECC)).

The Spanish real estate market slowed over the
course of 2023, but evolution for the full year was
better than expected in an environment of high
interest rates. This positive evolution is explained
firstly by the 2.5% growth in GDP over the full
year, amply exceeding the growth predicted at
the end of 2022 (1%) due mainly to the quicker
than expected fading of the energy crisis and the
positive figures from Spain’s export sector, heavily
dependent on invisible exports, both tourism
and others.

The positive tone of the Spanish economy was
reflected in some excellent labour market figures
in 2023: the number of people in employment
grew by 783,000 and the unemployment rate fell
by more than 1 pp to 11.8% in the fourth quarter of
2023 (as against 12.9% at year-end 2022).

The proportion of workers on temporary contracts
has fallen in the past few years (16.5% in Q4 2023
as against 26.3% in 2019) and pay per employee
has increased by around 4%, which is more than
the inflation rate over this same period (3.6%).

The strength of the labour market has attracted
significant migratory inflows. In 2023, the foreign
population resident in Spain grew by 544,000
persons (709,000 if we include people with dual
nationality), very significant figures not seen
since the property boom which ended in 2008.
This population tends to live in areas of greater
economic activity such as the major cities and
tourist zones, affecting demand for housing in
these areas.

Another factor supporting the real estate market
is households’ financial situation, which has
been less stressed than expected. In particular,
household indebtedness as a percentage of gross
disposable household income (GDHI) fell to 76.5%
in Q3 2023, the lowest level since 2002 and 12 pp
below the EU average (89%).

These factors supported demand for housing
and mitigate the negative impact of the increase
in interest rates. Consequently, although housing
conveyances fell by 9.7% in 2023, to 587,000
units, they were well up on pre-pandemic levels
(by 16.1% relative to 2019) and on the historical
average (470,000 units). By segment, the greatest
adjustment was concentrated in conveyancing

of second-hand housing (down by 10.8% in 2023
compared with the 4.8% fall in conveyances of
new-build housing). In 2023, sales of new housing
accounted for 17.9% of total sales (20.1% in 2022).

Conveyances by foreigners, which peaked strongly
in 2022 (94,500 homes according to the College
of Registrars), are falling at a slower pace than
those of Spaniards’ first and second homes.
According to conveyancing data of the Ministry
of Housing and Urban Agenda (MIVAU for its
acronym in spanish), the number of conveyances
by foreigners fell by 8.7% YoY in the first three
quarters of 2023, compared with an 11.8% fall in
those of second homes and a 15.0% fall in those of
first homes on the part of Spaniards. This relatively
better performance in terms of conveyancing by
foreigners led to their weight in the total increasing
significantly (20.2% according to the Ministry and
15.4% according to the College of Registrars in Q3
2023).

In the market for mortgage loans, interest rates on
new mortgage loans remained fairly tight despite
the increase in official interest rates and market
reference rates, such as the 12-month euribor. For
example fixed rate mortgage loans were granted
at average rates of 3.5% in the second half of 2023,
whereas euribor was over 4% in that period.

Reform of the foyer of the Albasanz 16
building, Madrid (Spain).

3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFCC. Annual Report 20231_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

252

Real Estate | Industry analysis | Page 2 of 4

The price of housing showed notable downside
resistance. In mid-2022, when the European
Central Bank (ECB) started the new cycle of
interest rate hikes, the price of housing started to
slow, and it continued to slow until the first half
of 2023. However, in the second half it picked up
the pace again. Specifically, the appraisal value
of free housing (MIVAU) rose by 1.6% QoQ in
Q4 (as against 0.3% in Q2 and 1.1% in Q3) and
the YoY change went from 4,2% in Q3 to 5.3%
in Q4. The housing price index published by the
National Statistics Institute (INE for its acronym
in spanish), based on transaction prices, showed
similar behaviour: a significant advance in Q3 (2.5%
QoQ as against 2.1% in Q2) and increase in the
YoY change (from 3.6% in Q2 to 4.5% in Q3). The
resilience of demand for housing, (which, despite
falling, remains at high levels), and a limited supply
of new housing are the main factors explaining
the price resistance in nominal terms. In real
terms, the adjustment in the price of housing was
considerable (-2.8% in 2022-2023).

By segments, the price of new housing grew much
more significantly (by 11% YoY in Q3), compared
with second-hand housing (3.2%), due to the
relatively short supply of new housing, greater
preference for this kind of home and residential
construction costs that have consolidated at a high
level (increasing by 3.7% in 2023 after increasing
by 20% in 2021-2022).

The supply of housing is increasing slowly. The
number of new-build permits has practically
stagnated (down by 0.2% YTD from January to
November 2023, amounting to 109,000 homes
in the past 12 months). It is worth positively
highlighting this figure, since the context has not
been very favourable for the production of new
housing: construction costs have remained high,
financing costs have increased and there was
some uncertainty as to the resilience of demand in
a context of sharply rising interest rates.

The stabilisation of construction costs made it
possible to end 2023 with a similar number of new-
build permits to that of previous years, despite the
increased costs of financing.

One of the most critical points for the residential
market is land, the raw material of any real estate
development. In this regard, the market is confident
that there will be downward corrections to the price
of land, as well as stabilisation of construction
costs and adjustments to interest rates from the
second quarter. All this will allow us once against
to access transactions with more attractive
margins.

According to data presented by the CBRE
consultancy, Spanish real estate investment fell by
36% in 2023, to €11.2 billion, after pealing at over
€17.6 billion in 2022.

Although the hotel sector led the field as far as
investment is concerned, the residential sector
came in second with 27% of the total, over €3
billion, 32% less than in 2022. Transactions aimed
at the rental of homes accounted for 61% of total
investment in this segment.

The Spanish rental market is going through one of
its most difficult patches. There is a considerable
imbalance between supply and demand, with very
limited availability of property to rent. The available
rental stock is almost zero, which represents a
great obstacle for nearly 40% of tenants. The result
of this situation is a very compact market in which
there is very little turnover of tenants, ever longer
search processes and which is increasingly difficult
to access.

Real Estate | Industry analysis | Page 3 of 4

The main consequence of the lack of available
supply is the high price of rental homes. This
instability leads to high price tensions, which
in the first half of 2023 was reflected in intense
escalation, with the national all-time record high
rental of €11.69 €/m² per month surpassing the
previous record set during the property bubble
of 2007.

Law 12/2023 on the right to housing has not
improved access. Six months after it came into
force, the balance sheet is unfavourable: it has
brought only uncertainty and discontent. Almost
half of Spain’s autonomous regions have lodged
appeals against the law with the Constitutional
Court, thus generating a climate of legal insecurity
and instability.

In fact, measures such as the limitation on annual
price reviews for rental contracts are leading a
large number of landlords to seek new rental
formulas not governed by housing laws, such as
tourist rentals, rental of rooms or seasonal renting.
By acting as a disincentive to investment in annual
rentals, this situation is leading to significant
contraction in the stock of long-term rental
housing.

In 2023, 9,361 build-to-rent (BtR) apartments came
onto the Spanish real estate market, 139% more
than in 2022 (3,917 units). Barely 2,750 of them
were at affordable prices. In the past five years,
investment funds, property developers and public
administrations have delivered 15,710 new rental
apartments. The bulk of these properties are in the
city of Madrid (10,448) followed at a considerable
distance by Barcelona (2,248) and Valencia (1,136).

Despite Spain’s obvious need for homes to rent,
and despite the fact that the pace of deliveries
of such projects has increased every year since
2019 (except for 2021 due to the impact of the
pandemic), the business refuses to settle and is
still far removed from revolutionising the rental
market as it promised. The economic situation has
not been favourable to it either, particularly in 2023.
The price of land, construction costs, increasing
operational expenses and the cost of financing
mean that for many investors the final returns are
not generally attractive.

The ECB’s interest rate hikes to contain inflation
were a decisive factor in some developments of
rental apartments being halted. It has to be borne
in mind that the profitability of these projects is
closely linked to interest rates, which reached their
highest levels for twenty years in 2023, reaching
the current 4.5%.

253

However, the moderation of interest rates in the
coming year, with a potential reduction to 3.2% in
February 2025, compared with the current 4.5%,
will make this asset attractive to investors once
again.

A regards the lack of land available for build-to-
rent developments, various studies have shown
the potential of reconverting offices in the main
metropolitan areas. It is estimated that such
actions would allow 11.4 million square metres
of office space to be converted into 92,786 new
homes in the metropolitan areas of Madrid,
Barcelona, Málaga and Valencia. But this would
increase the available stock by just 1.54%, so
the reconversion of offices would have to be a
complement to investment in new-build in order to
have any real effect on the available housing stock.

As regards the market for offices, investment in
the sector contracted by 50% in 2023 relative to

the previous year. With some €1.25 billion invested,
offices captured 11% of the total invested in the
real estate sector. This places offices above other
sectors such as retail, manufacturing or logistics,
but far below the investment figures of earlier
years. Indeed, we have to go back to 2013 in order
to find a year with such a low investment figure.
The lack of balance between the prices that buyers
are willing to pay and those that sellers aim to
obtain is one of the main causes of this situation.

Madrid and Barcelona were once again the leaders
in investment in the office sector in 2023. Of the
total invested, 67% was concentrated in Madrid,
while 27% corresponded to Barcelona, leaving
6% spread among the other major cities. In
Madrid, the heaviest investment was in the CBD
(Central Business District) and the centre, while in
Barcelona it was mainly divided between the 22@
district and the city centre.

254

Real Estate | Industry analysis | Page 4 of 4

At the end of the third quarter of 2023, Madrid
and Barcelona between them had absorbed
540,000 m2, representing a 16% contraction relative
to the same period of the previous year. The
shrinkage in Madrid was less marked: it ended Q3
with a cumulative 380,000 m² contracted, down by
5%. In Barcelona, for its part, 35% less surface area
was contracted in the first thee quarters of 2023,
160,000 m².

As regards the evolution of prime rentals, we
see differential behaviour in the two major cities.
In Madrid, we see prices for offices in the best
locations slowing, rising by 3% to reach
€38/m²/month. However, in Barcelona prime
rentals fell to €26/m²/month, 7% less than at
year-end 2022; which may become an advantage
for the city, since it has workspaces at competitive
prices with which to attract large companies
seeking to locate their HQ in one of Europe’s
major cities.

Prime yields in Madrid are in excess of 4,5%, 0.7 pp
above year-end 2022. In Barcelona, prime yields
stand at 4.75%, 0.5 pp more than a year ago. Slight
increases are expected in the prime yields of both
cities in 2024.

The generalisation of remote working is one
of the causes of the current situation in the
office sector. Even so, we see office-based work
regaining ground in Spain. In Spain, the average
office attendance is three days a week, compared
with the European average of 1.8 days a week.
This circumstance will continue to influence
the arrangement of workspaces, with less
area devoted to offices and more flexible and
collaborative spaces.

In the shopping centre sector, 2023 ended with
record revenues of €52.05 billion, up by 9.6% on
the previous year, according to data from the AECC
(Spanish Association of Shopping Centres and
Retail Parks).

As regards the footfall, the sector reached
1.84 billion visits in 2023, 6.3% more than in 2022,
but still below the figure for 2019 (-8.3%), although
the sector is optimistic that it will continue growing
and maintain this positive trend so as to surpass
pre-pandemic figures in the next few years.

In 2023, there were not many transactions, in line
with the general trend in the real estate sector, but
the market is forecast to re-activate as interest
rates are gradually relaxed.

In the course of the year, five new projects were
opened: A Revolta (La Coruña), Jaén Plaza (Jaén),
La Finca Grand Café (Madrid), Nasas Torrejón
(Torrejón de Ardoz) and Nexum Retail Park
(Fuenlabrada), representing 101,682 m2 of GLA,
ad two were closed (Moda Shopping, Madrid and
Llobregat Centre, Cornellá).

Activity in terms of shop openings in shopping
centres was also intense, with 2.6% more
transactions concluded than in the previous year.
By sectors, restaurants, fashion and sports were
stood out particularly.

According to data from CBRE (CB Richard Ellis)
Real Estate Market Outlook for Spain, prime rentals
for shopping centres at the end of the year were
€50/m2/month, 9% down on those recorded at the
beginning of the year. They are forecast to hold
steady in the first half of 2023.

This past year 2023 was a very positive and
dynamic year in which there were new openings
and in which the investment market started to
recognise the value of shopping centres. All
economic activities increased. For example food
and beverage posted an increase of 2.6% relative
to 2022, while fashion and accessories grew by
5.2% and home appliances by 5.9%.

In this way the sector remains an economic driver,
since the number of jobs in shopping centres and
retail parks grew by 1.16% relative to 2022, to
870,000, 54% of them direct. Furthermore, it brings
together 33,500 merchants, 85% of whom have
premises of fewer than 300 square metres.

Madrid and Andalusia are the autonomous regions
with most shopping centres and retail parks. In
Spain there are currently 580 shopping centres
with a gross leasable area (GLA) of 16.7 million
square metres.

Real Estate | Activity of the Real Estate Area | Page 1 of 8

2. Activity in the Real Estate Area

The activity of the Real Estate Area is carried

out in three main business lines:

INVESTMENT PROPERTY

DEVELOPMENT BUSINESS

LAND MANAGEMENT

Torre Realia \ The Icon, Madrid (Spain).

Real Estate | Activity of the Real Estate Area | Page 2 of 8

2.1.
Investment Property

Leasing and management of

office buildings, commercial

premises and shopping

centres

Operation of projects aimed

at housing rentals

The portfolio of leased offices is concentrated in
26 buildings that stand out due to their strategic
location (in Madrid, Barcelona and Seville) and,
in some cases, due to their iconic or historic
character.

In addition, the portfolio of shopping centres
consists of six commercial and leisure assets,
located in Madrid city, Leganés (Madrid),
Guadalajara (Castilla-La Mancha), Murcia and
Santiago de Compostela (La Coruña).

Jezzine Uno contributed a significant volume
of rental assets consisting in the operation of
405 premises throughout Spain, although with a
greater concentration in Catalonia. This concerns
a long-term lease, until December 2037, to a single
lessee (CaixaBank).

Taking into account the unstoppable trend of
residential rental, given the active demand in this
segment and the persistent scarcity of supply from
major property owners in Spain, a few years ago
the subsidiary Valaise was strengthened in order
to invest in this business segment. At present,
the BtR activity is concentrated on three assets,
already in operation, located in the municipality of
Tres Cantos, in Madrid (Residencial Nao, Jardín
de Tres Cantos II and Residencial Provenza). The
three of them together total 280 social housing
units.

Albasanz 14 and Albasanz 16 buildings, Madrid (Spain).

Feria Plaza Shopping Centre, Guadalajara (Spain).

Residencial Provenza - 152 homes -, Madrid (Spain).

Real Estate | Activity of the Real Estate Area | Page 3 of 8

2.2.
Development Business

In 2023, the marketing of the following
developments began:

Development and sale

of real estate products

(mainly housing)

HATO VERDE SOUL

RESIDENCIAL BENEVÍVERE

PARQUE DEL ENSANCHE III

Realia is developing 64 detached homes in
Guillena, Seville , with 3 and 4 bedrooms, terrace
and private garden. The development also has
communal areas with a swimming pool and a
common room. It features magnificent view of the
Hato Verde golf course.

FCC Inmobiliaria is developing 98 new-build homes
with 2, 3 and 4 bedrooms, ground floor with garden
and penthouse, in the municipality of Valdemoro,
Madrid . They each have two parking places and
a store room included. The properties all have
spacious terraces from which to enjoy spectacular
views in the open air. The communal zones have a
swimming pool with salt chlorination system and
a children’s play area. This development is notable
for its Passivhaus certification, with almost zero
energy consumption.

Realia is developing 113 new homes in the
municipality of Alcalá de Henares, Madrid . The
new homes have 2, 3 or 4 bedrooms, ground floor
with lofts, all with spectacular terraces. A unique,
modern project with large communal areas. In
Phases I and II: swimming pool, landscaped zones
and two padel courts. Phase III of this magnificent
residential project will also feature a children’s play
area, Pet Spa and a novel water park (SplashPark).

Infographic: Hato Verde Soul -64 detached homes-,
in Guillena, Seville (Spain).

Infographic: Residencial Benevívere -98 homes-, in Valdemoro, Madrid (Spain).

Infographic: Parque del Ensanche Phase III -113 homes-
in Alcalá de Henares, Madrid (Spain).

258

RESIDENCIAL PIREO

SOMNIA MARE BY PORTUM

RESIDENCIAL HUBARA

FCC Inmobiliaria is developing 108 apartments
with 2, 3 and 4 bedrooms and terrace, each with
two parking spaces and a store room. Pireo is
a residential project with spacious, well-kept
communal areas including a swimming pool with
salt chlorination, a children’s playground and a
padel court, located in the municipality of
Tres Cantos, Madrid .

FCC Inmobiliaria is developing 141 apartments
with 1, 2, 3 and 4 bedrooms and shopping areas.
The residential project is located next to the Port of
Badalona, Barcelona , so it has unparalleled views.
It has excellent communal areas: a communal
swimming pool, co-working, gym, solarium and
children’s play area.

REALIA is developing 44 apartments of 2, 3 and 4
bedrooms with large terrace, in the Doctor Negrín
quarter, one of the most modern of Palmas de
Gran Canaria. Hubara is a residential project
with well cared-for common areas including a
communal swimming pool with salt chlorination.

Infographic Pireo -108 homes in
Tres Cantos, Madrid (Spain).

Infographic: Somnia Mare by Portum - 141 homes -, in Badalona, Barcelona (Spain).

Infographic: Residencial Hubara - 44 homes -,
in Las Palmas de Gran Canaria, Canary Islands (Spain).

259

2.3.
Land Management

Characteristics of land under
management

Sales and purchases of land
in 2023

During 2023 we sold 5,817 m2 of buildable land for
residential use and 16.335 m2 for commercial and
tertiary use, in four sale transactions. Not all the
plots sold were suitable for development, due to
their location, type of product or size.

These sales were accompanied by ten purchase
transactions for 44.086 m2 of buildable land for
residential use in Madrid .

FCC’s Real Estate Area manages more than
2.38 million square metres of buildable land with
the following characteristics:

58% is in the provinces of Madrid, Barcelona
and Málaga.

76% is residential.

and 39% of which is serviced development land.

The number of homes that could be built on the
land owned by FCC Inmobiliaria or its subsidiaries
exceeds 17,700 units.

The real estate activity requires a land portfolio
that is balanced geographically and in terms
of town planning. By means of town planning
management, with our own or external resources,
we manage to obtain serviced development and
at a competitive cost as a first step towards its
development.

Marina Badalona: 3,800 m2 of gross floor area for 212 homes, in Badalona, Barcelona (Spain).

Real Estate | Activity of the Real Estate Area | Page 6 of 8

Town planning milestones
in 2023

The main planning milestones attained in 2023, by
zones, were as follows:

Central Zone

Catalonia

Andalusia

Levante

Retamar de la Huerta, Alcorcón (Madrid) - Realia:
Re-division of land definitively approved. Waiting to
obtain the last reports necessary for the definitive
approval of the urbanisation project and the
Special Infrastructure Plan. The viability of the
provisional connection to the sanitation network,
which would cover the delivery of the first homes,
has bee approved.

SG-1 San Gregorio (Zaragoza) - Realia:the first
phase of the feasibility study for the installation of
sustainable drainage systems (SUDS) has been
prepared. Soil permeability trials have been carried
out. Waiting for the second phase of the SUDS
installation feasibility study to be carried out.

Polygon A of the Port of Badalona, Barcelona –
FCyC: imminent start of works on the ADIF (railway
infrastructure administrator) bridge over the canal.

Vallcarca Cement Works (Sitges, Barcelona ) –
FCyC: submitted a proposal for the transformation
of the Vallcarca cement works to the Sitges
Municipality with a view to regenerating the zone
and turning it into a new technological district
with productive, residential, hotel, shopping and
equipment aspects.

SUNC-01 Los Pacos de Fuengirola (Málaga) -
FCyC: commissioning of the Detailed Study and
Plan for Provision of Infrastructure necessary for
its development. Drawing up pre-draft on the free
plot of FCyC.

UE2 SUP-LO El Pato (Málaga) - FCyC: urbanisation
works completed and accepted by the Málaga
Municipality. Constitution of a town planning
conservation entity. Imminent start of first
residential developments.

Nueva Condomina (Murcia) - Realia: definitive
approval of Modification No. 3 to the Partial Plan
for sector ZB-SD-CH7, Nueva Condomina.

Ronda Norte de Dénia (Alicante) - Realia: approval
of the Denia General Structural Plan.

Fuente de San Luis (Valencia) - Realia:
consolidation of the sector with the first
developments delivered.

SUP-T8 Teatinos University (Málaga) - Realia:
works 37% completed.

Real de Valdomina, San Juan de Aznalfarache
(Seville) - Realia: definitive approval of the
amendment to the Partial Plan and the
Compensation Project.

Hato Verde, Guillena (Seville) - Realia: definitive
approval of the document Adapting the Guillena
Urban Land Delimitation Plan to the Andalusian
Law on Urban Planning. However the Andalusian
Supreme Court has handed down a ruling blocking
the development. We have appealed this ruling.

International

Vela Borovica, (Split, Croatia) – FCyC: studying
the possibility, with the Marina Municipality, of
changing aspects of the urban planning to facilitate
the development of the sector.

United Kingdom – FCyC: internal transfer of 15
sites with a total area of 257 hectares. Waiting for
permission from the UK government environmental
agency for the transfer of another 32 sites with a
total area of 1,108 hectares.

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

261

Real Estate | Activity of the Real Estate Area | Page 7 of 8

Key figures 2023

Turnover

Value of assets
land and development

Ebitda
(adjusted for provisions)

Occupancy rate of
assets

Value of investment property

Human team

(*) Excluding staff assigned to the concierge’s office in rented buildings.

€2,139million€767million69%Residential74people(December2023)*93%Tertiary€105million€254 million
1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

262

Real Estate | Activity of the Real Estate Area | Page 8 of 8

Experience

Implantation

Scale

Significant events in 2023

More than 550,000 m2 of surface area rented out for use in the service sectorDuring 2023, the consolidation of the FCC Group’s Real Estate Area continued, with the FCC Inmobiliaria Group (FCyC, S.A.) increasing its stakes in listed companies Realia Business, S.A. and Metrovacesa S.A. by 80.03%, summarised as follows:• 13.56% increase in the interest in Realia Business, S.A., reaching 67.05% at year-end 2023 (53.49% in 2022).• 7.38% increase in the interest in Metrovacesa, S.A., reaching 21.19% at year-end 2023 (13.81% in 2022).In December 2023, a director appointed by FCC Inmobiliaria joined the Board of Directors of Metrovacesa, which started to be accounted for using the equity method in the Company’s consolidated financial statements, reflecting the fair value of the Company’s interest in Metrovacesa and allocating 21.19% of its results to the Company from 2024 on. In 2023, the change in accounting treatment of this associate, from financial investment to the equity method, entailed an increase in the equity of the FCC Inmobiliaria Group of €59.3 million and a positive effect on its profit of €142.4 million.280 BtR homes letMore than 17,000 homes deliveredMore than 2.38 million m2 of gross floorarea (more than 17,700 homes), land at variousstages of developmentInternational presence Romania and CroatiaMore thane 30 years of experience in the real estate sectorPresent in 15 autonomous regions of Spain
1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

263

Real Estate | Highlights Real Estate 2023

3. Highlights Real Estate 2023

January

March

May

July

September

November

February

April

June

August

October

December

_ Construction begins at Residencial Arabona. 64 detached 4-bedroom homes of FCC Inmobiliaria in the municipality of Tres Cantos (Madrid, Spain)._ Handover of keys for71 apartments of FCC Inmobiliaria’s “Bôrea Portablanca Phase II” development: 1, 2, 3 and 4-bedroom homes in Arroyo del Fresno (Madrid, Spain)._ Construction begins at Realia’s “Hato Verde Soul” development. 64 chalets with 3 and 4 bedrooms in Guillena (Seville, Spain)._ Start of marketingof “Residencial Provenza Phase I”:50 protected rental apartments developed by Valaise. 1, 2 and 3-bedroom homes in Tres Cantos (Madrid, Spain)._ Launch of the marketing strategy for “Residencial Benevivere”: 98 apartments with 2, 3 and 4 bedrooms with excellent communal zones including a swimming pool and children’s play area in the municipality of Valdemoro (Madrid, Spain)._ Construction begins at “Residencial Pireo”, 108 multi-family homes, 2, 3 and 4 bedrooms, with ground floor and penthouses in the municipality of Tres Cantos (Madrid, Spain)._ Application for Building Permit for the “Natura” residential building, 64 apartments in Massarrojos (Valencia, Spain)and the “Sedalis” residential building, 39 apartments in Finca El Pato (Málaga, Spain)._ The Torre Realia\The Icon is rated “Outstanding” in the management category, the highest rating granted by BREEAM , thus joining a select group of 13 office buildings in the Autonomous Region of Madrid (Spain)._ Start of marketing of “Residencial Provenza Phase II”, a development of Valaise, 43 protected rental homes.1, 2, and 3-bedroom homes in the municipality of Tres Cantos (Madrid, Spain)._ Handover of keys to Realia’s “Glories Bcn” 47 homes with 2, 3 and 4 bedrooms and a shopping area (Barcelona, Spain)._ Construction begins on Realia’s “Hato Verde Soul” development.63 single homes with 3 and 4 bedrooms in Guillena (Seville, Spain)._ Start of refurbishment works on the foyer of the Castellana 41 office building (Madrid, Spain)._ Launch of the marketing strategy for “Parque del Ensanche Phase III”: 113 homes with 2, 3 and 4 bedrooms and a shopping area. Common zones with SplashPark and Pet Spa which are joined to Phases I and II with swimming pool, landscaped zones and two padel courts._ Start of refurbishment works on the Albasanz 14, Albasanz 16 and Avenida de Bruselas 36 office buildings (Madrid, Spain)._ Handover of the keys to Realia’s “Parque del Ensanche Phase II”, development of 80 apartments with 2, 3 and 4 bedrooms in Alcalá de Henares (Madrid, Spain)._ Launch of the marketing strategy for “Residencial Provenza Phase II”, a development of Valaise, 102 protected rental homes. 1, 2, and 3-bedroom apartments in the municipality of Tres Cantos (Madrid, Spain)._ Launch of the Realia app in office buildings for requesting services, reporting incidents, posting the cultural agenda, exclusive discounts for tenants, etc._ Initiation of sales of Realia’s “Hubara” development. 44 apartments with 2, 3 and 4 bedrooms, in Las Palmas de Gran Canaria (Canary Islands, Spain)._ Launch of Realia’s new website._ Completion of the refurbishment works on the foyers of the Albasanz 14and Albasanz 16 office buildings (Madrid, Spain)._ Initiation of sales of FCC Inmobiliaria’s “Residencial Pireo”, 108 multi-family homes, 2, 3 and 4 bedrooms, with ground floor and penthouses in the municipality of Tres Cantos (Madrid, Spain).FCC. Annual Report 2023

264

Real Estate | Service excellence | Page 1 of 5

4. Service excellence

The Real Estate Area carries out
its activity with the philosophy of
offering its customers high quality
products and services, adapted to
new living habits and market trends.

Home buyers

They are served through an omnichannel network
that seeks to guarantee a good shopping
experience.

Face-to-face service is provided at the sales
offices of each development, the branch offices
and the head office, by trained and experienced
professional personnel who advise customers
throughout the decision-making process, show the
properties, explain the economic and contractual
conditions and facilitate the process of handing
over the homes, whether they are for rent or
for sale.

Customers can find out about all the real estate
on the website where, through their technical data
sheets, they can view images and large-scale
plans of the products, 360° virtual tours, videos,
3D real-world mock-ups and request virtual
appointments with sales personnel. By means of
a very simple form, customers can also make an
appointment directly to visit each point of sale or
obtain information on any specific matter they may
wish to raise.

Valaise, the Group company dedicated to BtR,
has developed an ad hoc app that allows tenants
to access their personal information and manage
any kind of incident, request or procedure with the
company. Its use is giving very good results and
highlighting the value of the efforts being made on
digitisation in all areas of the business.

In terms of data, in 2023 we received 959 direct
telephone calls, 13,657 contacts via email and 389
direct visits to points of sale. We posted 2,215 first
visits, with a ratio of 16.2% first visit/candidates,
finally closing 320 down payments, giving a ratio of
down payments per visit of 14.5%.

The Real Estate Area is committed to eco-
sustainability, which is why the homes developed
have an A or B energy rating. This is described in
detail in the technical data sheets available on
the website.

Social networks play an important role as a
communication channel, allowing the promotion
and dissemination of valuable content for
customers on topics such as decoration trends,
sustainability, technical aspects and current
events in the sector. Throughout 2023, the
company’s presence on social networks attracted
a noteworthy number of followers.

In December 2023, we launched Realia’s new
website, with optimised visualisation, improved
navigation with 100% responsive adaptation and
with use mainly by mobile devices in mind. The
multimedia content has been developed with a
customised gallery both for both sales and rental
promotions and investment property (offices and
shopping centres).

Tenants

The Real Estate Area’s philosophy involves offering
high quality spaces, keeping them constantly
updated with the latest technological innovations
and sustainability. It also focuses on providing
its tenants with high value-added services that
facilitate the development of their businesses and
provide a friendly and healthy experience for their
occupants.

In 2023, our capital expenditure was geared to
improving occupant’s and users’ experience,
modernising services (energy efficiency, hospitality
zones, communal services, facilities, etc.), and
bringing rentable spaces into line with new
demands, promoting environmentally sustainable
buildings and optimising operational costs.

Prominent among these efforts to modernise
were the foyers of the buildings at Castellana, 41;
Avenida de Bruselas, 36; Albasanz, 14 and
Albasanz, 16, which were given a much more
modern look with lighter coloured materials,
relaxation spaces, digital screens, etc.

The new Realia app was launched in September
2023 with exclusive discounts on entertainment,
travel, purchases, etc., an agenda of cultural events,
information on mobility and offering the possibility
of managing services such as reserving parking
spaces, reporting incidents, etc.

Apart from this, a policy of rigorous control of
operating costs of buildings is applied, taking
advantage of the data analytics of its BMS
(Building Management System) and the economy
of scale generated by having a significant-sized
portfolio. This cost control also benefits the
tenants by containing the costs passed on to
them. The Real Estate Area develops building
operations with multidisciplinary professional
teams (maintenance, legal, architecture,
construction, commercial, urban planning and
economic-financial). In the case of shopping
centres, management is carried out by specialised
consultants coordinated internally.

265

Shopping centre users

To ensure a pleasant shopping experience, all
complexes have been designed with functionality
and accessibility in mind. Thus, they combine
leisure and commercial areas and have large
common areas and spaces designed to provide a
comfortable stay and fluid circulation.

During 2023, our capital expenditure was geared
to improving occupant’s and users’ experience,
modernising services (energy efficiency, hospitality
zones, communal services, facilities, etc.) These
actions included the refurbishment of the toilets
at the Ferial Plaza Shopping Centre in Guadalajara,
and the improvement of the roof cladding of both
the Plaza shopping centre and the Plaza Nueva
Leganés shopping centre, in Madrid.

As part of their commitment to sustainability
and corporate social responsibility, the shopping
centres carry out many dynamic actions
focused on promoting responsible recycling
behaviours, healthy nutrition, support for local
entrepreneurship, preservation of native flora and
fauna, etc.

Reform of the foyer of the Albasanz 16 building, Madrid (Spain).

5. Sustainability, innovation and technology

266

In 2023, the Real Estate Area formalised and
extended its commitment to the environment
and the stakeholders it affects, implementing the
company’s ESG Strategy 2024-2027. There are
three lines of work (Environmental, Social and
Corporate Governance) which are broken down
into 40 specific targets, with various objectives
established for each of them, aligned with the
Sustainable Development Goals (SDGs)of the
Agenda 2030 approved by the United Nations.

Complementarily and transversally to the main
lines of work, we have established a fourth line
which encompasses Digitisation, Training and
Communication, contributing to the development
of a sustainable framework that kelps with its
implementation.

This Strategy accentuates and reinforces the
bases for the development and continuous
improvement of the business, in both its
development and its investment property branches,
within the principles of sustainable architecture
and respect for the environment.

One of the main objectives within the Real Estate
Area, in its investment property branch, is to
achieve the best standards of sustainability in
the whole portfolio of properties that it holds
through renovation and by obtaining certificates
of sustainability, complemented with investments
geared to energy efficiency.

We have committed to having the entire portfolio
certified by BREEAM in the next three years.

This holistic approach will allow us to develop
each of the lines of work independently and
complementarily, establishing specific objectives
for each of them. We detail hereunder those
corresponding to the environmental line of work.

DIGITISATION

COMMUNICATION

TRAINING

5.1.
An environmental
strategy

Having analysed the impact of our business on
the environment, we established four categories
of action, which address the development of the
Environmental Strategy, setting the corresponding
objectives to allow us to monitor progress in the
time frames established by the Strategy.

Category 1:
Energy and Emissions

In line with SDG 7 “Affordable and Clean Energy”
and SDG 11 “Sustainable Cities and Communities”,
in 2023 we carried out an analysis of the
decarbonisation of our investment property,
with a view to identifying the opportunities for
improvement in each of the assets. In this regard
we started the process of renewing the Energy
Efficiency Certificates of the various properties,
especially in rented offices and shopping centres.

267

Category 3:
Water Management

In line with SDG 6 ‘Clean Water and Sanitation’
and SDG 11 ‘Sustainable Cities and Communities’,
and in response to the restrictions on water
consumption that affect much of the territory
where the company operates to a greater or lesser
extent, we have developed water management
objectives aimed at reducing our impact as a
business on both consumption and the re-use
of water.

The main specific objectives established for
managing water resources in al the assets in the
portfolio, whether operational or investment, are:

Within this category the following are the specific
corrective objectives that will support the actions
and measures of the various business lines:

Increase the energy efficiency of the portfolio
of properties, both in development and held as
investments, reduce the associated economic
and environmental impacts.

In the framework of Law 7/2022 on Waste and
Contaminated Soil for a Circular Economy, we
established this category as a key line within
the company’s ESG policy, in which we develop
objectives and measures to establish the
management and control systems that will allow
us to improve the routing of the materials used and
of the various waste streams generated by creating
or operating our real estate assets.

Measure and monitor the emissions generate by
the assets in the portfolio, both in development
and held as investments.

In this category we define the following specific
objectives:

Bring about an optimal positioning of the assets
as regards ESG by implementing measures to
save energy and reduce emissions.

Establish control KPIs (Key Performance
Indicators) to monitor emissions generate at
corporate level.

Provide efficient management of waste
(including recycling and circular economy
alternatives) in both the management and the
development of new assets.

Manage the selection of materials in the various
projects with environmental and social criteria.

Reduce the non-essential use of water in the
company’s assets and developments.

Adjust the emissions of the portfolio within the
objectives and the rules at European and global
level.

Monitor all waste generated both by new
developments and by operational assets with
the sue of digital tools.

Monitor water consumption both by new
developments and by operational assets with
the use of digital tools.

Category 2:
Materials and Waste

In line with SDG 11 ‘Sustainable Cities and
Communities’ and SDG 12 ‘Responsible Production
and Consumption’ and within our contribution
to the creation of households and workspaces,
we made a change to the management of
construction materials and waste generated in the
various construction processes.

Within the investment properties of the Real Estate
Area, we favour the selective collection of waste
from offices and shopping centres, making a clean
point available to users in each building, informing
them about recycling principles and working with
specialised waste managers in order to ensure
the traceability of waste treatment and its correct
recycling.

Implement measures to re-use water (irrigation,
sanitary use, cleaning, etc.).

Implement requirements for the conservation of
water, both in looking at new projects and in the
design phase of new developments.

Include efficiency measures for the use of water,
such as damp sensors and leak detectors.

268

Category 4:
Biodiversity and Pollution

In line with SDG 11 ‘Sustainable Cities and
Communities’ and SDG 15 ‘Life on Land’, we
have investable some specific objectives relating
to respect for the environment and support for
ecosystems and biodiversity. As a complement to
this, in the investment property business line, we
have addressed objectives relating to biodiversity
and pollution in consonance with the guidelines
established in the BREEAM certificate.

To reduce the impact that our business could
have on the biodiversity of the spaces in which
it operates, we have set the following specific
objectives or all assets in the portfolio, whether for
development or investment:

Promote and encourage construction on land
with limited value for flora and protect the
ecologically valuable elements that exist against
substantial damage during the preparation and
execution of the works.

Recognise and encourage the actions carried
out to maintain and improve the ecological value
of the site as a result of the construction and/or
urbanisation.

Recover green zones that have been abandoned
or that have no ecological value.

5.2.
A transversal
strategy

Digitisation, Training
and Communication

As a framework for the three lines of work
(Environmental, Social and Corporate Governance)
we have established a complementary line
encompassing Digitisation, Training and
Communication. Within it we have implemented
digital tools that allow us continuously to evaluate
the various control KPIs established. These
parameters become a tool that contributes to the
monitoring, detecting possible improvements in
the business and speeding up working processes
to give customers better service.

Apart from this, this process of digitisation
favours dissemination, training of the various
people involved and transmission of information
on the corporate ESG Strategy activating various
channels of communication that allow us to
reach all stakeholders related to our business
(employees, collaborators, suppliers, customers,
users, etc.).

The main specific objectives established for this
fourth line of work, which complement the three
main lines and apply to all lines of business, are the
following:

Digitise the monitoring of consumption and
waste management.

Automate work processes in the business.

Increase interactions and effective
communication with all stakeholders.

Use digitisation to increase transparency in
communication of financial and non-financial
information.

Encourage the training of the various
stakeholder groups on rules and regulations,
innovation and strategic ESG objectives.

Promote transparency with all stakeholder
groups; employees, customers and suppliers.

Position the various brads of the Real Estate
Area by means of ESG-related actions.

Disseminate the company’s strategic ESG
objectives to our employees, customers and
suppliers.

Financial Statements

Consolidated Group _ 270

Fomento de Construcciones y Contratas, S.A. _ 463

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

270

Consolidated Group

Consolidated balance sheet _ 271

Consolidated income statement _ 273

Consolidated statements of recognised income and expense _ 274

Total statement of changes in the consolidated equity _ 275

Statement of consolidated cash flows (indirect method) _ 276

Notes to the consolidated financial statements _ 278

Management Report _ 417

Consolidated balance sheet
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

271

The accompanying notes 1 to 32 and annexes I to V form an integral part of the consolidated financial statements, together with the 2023 consolidated income statement.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportASSETSNotes31/12/202331/12/2022NON-CURRENT ASSETS 10,655,661 9,874,542 Intangible assets62,483,475 2,342,148 Concessions6 and 101,543,161 1,512,644 Goodwill851,110 761,683 Other intangible fixed and non-current assets 89,204 67,821 Property, plant and equipment73,829,799 3,496,804 Land and buildings1,049,190 1,027,556 Plant and other items of property, plant and equipment 2,780,609 2,469,248 Investment property8 2,091,328 2,122,854 Investments accounted for using the equity method11 1,034,288 502,629 Non-current financial assets13 748,425 910,567 Deferred tax assets23 468,346 499,540 CURRENT ASSETS 6,062,014 5,407,999 Inventory14 1,234,338 1,143,202 Trade and other receivables152,886,531 2,409,262 Trade receivables for sales and services2,478,757 2,020,809 Other loans323,325 301,935 Current tax assets2384,449 86,518 Other current financial assets13 260,545 221,252 Other current assets15 70,897 58,745 Cash and cash equivalents16 1,609,703 1,575,538 TOTAL ASSETS 16,717,675 15,282,541 Consolidated Group | Consolidated balance sheet | Page 2 of 2

Consolidated balance sheet

FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

272

The accompanying notes 1 to 32 and annexes I to V form an integral part of the consolidated financial statements, together with the 2023 consolidated income statement.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportLIABILITIES AND EQUITYNotes31/12/202331/12/2022EQUITY17 6,145,927 4,938,993 Equity attributable to the Parent Company4,450,067 3,387,882 Shareholders’ equity4,489,566 3,415,724 Capital436,107 438,345 Accumulated earnings and other reserves3,462,881 2,689,461 Shares and equity interests(410)(27,264)Profit for the year attributable to the Parent company590,988 315,182 Valuation adjustments (39,499) (27,842) Non-controlling interests 1,695,860 1,551,111 NON-CURRENT LIABILITIES 6,708,319 6,046,615 Grants 226,624 202,864 Non-current provisions18 1,230,595 1,141,750 Non-current financial liabilities194,817,034 4,271,282 Debt instruments and other marketable securities1,860,879 1,267,584 Bank borrowings2,383,723 2,471,818 Other financial liabilities 572,432 531,880 Deferred tax liabilities23 284,179 281,977 Other non-current liabilities20 149,887 148,742 CURRENT LIABILITIES 3,863,429 4,296,933 Current provisions18 159,610 148,074 Current financial liabilities19926,771 1,333,125 Debt instruments and other marketable securities246,221 773,163 Bank borrowings326,206 306,531 Other financial liabilities 354,344 253,431 Trade and other payables21 2,777,048 2,815,734 Suppliers1,252,628 1,232,393 Other payables 1,485,166 1,559,731 Current tax liabilities2339,254 23,610 TOTAL EQUITY AND LIABILITIES 16,717,675 15,282,541Consolidated Group | Consolidated income statement

Consolidated income statement
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

Revenue

Self-constructed assets

Other operating income

Changes in finished goods and work in progress inventories

Procurements

Staff costs

Other operating expenses

Notes

26 and 27

Depreciation of fixed and non-current assets and allocation of grants for non-financial fixed and non-current assets, and other assets

6, 7 and 8

Impairment and gains/(losses) on disposal of fixed assets

Other gains/(losses)

OPERATING PROFIT/(LOSS)

Financial income

Financial expenses

Other financial profit/(loss)

FINANCIAL GAINS/(LOSSES)

Profit/(loss) of entities valued using the equity method

PROFIT/(LOSS) BEFORE TAX FROM CONTINUING OPERATIONS

Corporate income tax

PROFIT/(LOSS) FOR THE YEAR FROM CONTINUING OPERATIONS

CONSOLIDATED PROFIT/(LOSS) FOR THE YEAR

Profit/(loss) attributable to the Parent

Profit attributable to non-controlling interests

EARNINGS PER SHARE (euros)

Basic

Diluted

The accompanying notes 1 to 32 and annexes I to V form an integral part of the consolidated financial statements, together with the 2023 consolidated income statement.

273

31/12/2023

9,026,016

87,669

257,555

10,751

(3,700,000)

(2,474,449)

(1,677,916)

(587,377)

(46,984)

14,986

910,251

75,852

(225,824)

(18,377)

(168,349)

174,028

915,930

(171,120)

744,810

590,988

153,822

1.32

31/12/2022

7,705,687

74,137

288,480

26,656

(3,004,337)

(2,238,733)

(1,540,539)

(511,989)

(174,895)

(13,941)

610,526

45,148

(164,240)

29,605

(89,487)

29,614

550,653

(72,723)

477,930

315,182

162,748

0.73

Consolidated Group | Consolidated statements of recognised income and expense

Consolidated statements of recognised income and expense
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

CONSOLIDATED PROFIT/(LOSS) FOR THE YEAR

Other comprehensive income - Items that are not reclassified to profit/(loss) for the period

Actuarial profits and losses (*)

Tax effect

Other comprehensive income - items that can subsequently be reclassified to profit/(loss) for the period

Financial assets at fair value with changes in other comprehensive

Valuation gains/(losses)

Amounts transferred to the income statement

Cash flow hedges

Valuation gains/(losses)

Amounts transferred to the income statement

Translation differences

Valuation gains/(losses)

Amounts transferred to the income statement

Participation in other comprehensive profit recognised by investments in joint ventures and associates

Valuation gains/(losses)

Amounts transferred to the income statement

Tax effect

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

Attributable to the Parent

Attributable to non-controlling interests

The accompanying notes 1 to 32 and annexes I to V form an integral part of the consolidated financial statements, together with the 2023 consolidated income statement.
(*) Amounts that under no circumstances will be charged to the statement of profit and loss.

274

477,930

2,839

3,803

(964)

144,801

6,147

64,330

55,424

34,040

(15,140)

625,570

409,501

216,069

31/12/2023

31/12/2022

744,810

(5,352)

(6,117)

765

12,934

55,565

(17,760)

(20,774)

(9,218)

5,121

752,392

606,195

146,197

55,604

(39)

(4,544)

(13,216)

(20,866)

(2,351)

(6,867)

6,133

60,182

4,148

55,424

–

33,629

411

Consolidated Group | Total statement of changes in the consolidated equity

Total statement of changes in the consolidated equity
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

275

Share
capital

Accumulated
earnings and
other reserves

Shares
and equity
interests

Profit/(loss)
for the year
attributed
to the Parent
Company

Valuation
adjustments

Equity
attributable
to shareholders
of the Parent

Non-controlling
interests

Total
Equity

17.a

17.b

17.c

17.d

17.II

425,174

2,142,592

(26,674)

580,135

(114,133)

3,007,094

1,433,571

4,440,665

Neto
Notes
Neto
Equity as at 31 December 2021

Total income and expenses for the year

Transactions with shareholders or owners

Capital increases/(reductions)

Distribution of dividends

Transactions with treasury shares or equity instruments (net)

Other changes in equity

–

13,171

14,871

–

(1,700)

–

7,496

(41,864)

(14,871)

(10,783)

(16,210)

581,237

–

(590)

–

(590)

–

Equity as at 31 December 2022

438,345

2,689,461

(27,264)

Total income and expenses for the year

Transactions with shareholders or owners

Capital increases/(reductions)

Distribution of dividends

Transactions with treasury shares or equity instruments (net)

Other changes in equity

–

(2,238)

–

(2,773)

(316,742)

(297,290)

(19,452)

1,092,935

Equity as of 31 December 2023

436,107

3,462,881

–

26,854

298,588

–

(271,734)

–

(410)

315,182

86,823

–

(580,135)

(532)

315,182

590,988

(27,842)

17,980

–

(315,182)

(29,637)

409,501

(29,283)

–

(10,783)

(18,500)

570

216,069

(59,646)

(59,716)

–

(38,883)

625,570

(88,929)

(70,499)

(18,500)

(38,313)

3,387,882

1,551,111

4,938,993

606,195

(292,126)

(940)

(19,452)

(271,734)

748,116

146,197

(81,695)

1,874

(83,569)

–

80,247

752,392

(373,821)

934

(103,021)

(271,734)

828,363

590,988

(39,499)

4,450,067

1,695,860

6,145,927

The accompanying notes 1 to 32 and annexes I to V form an integral part of the consolidated financial statements, together with the 2023 consolidated income statement.

Consolidated Group | Statement of consolidated cash flows (indirect method) | Page 1 of 2

Statement of consolidated cash flows (indirect method)
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

276

The accompanying Notes 1 to 32 and Annexes I to V form an integral part of the consolidated financial statements, jointly forming the 2023 consolidated income statements.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report Notes31/12/202331/12/2022Profit/(loss) before tax from continuing operations Adjustments to profit or loss915,930 550,653 Ajustes del resultado614,816 668,929 Amortisation and depreciation6, 7 and 8596,877 522,201 Impairment and gains/(losses) on disposal of fixed assets6, 7 and 2646,984 174,895 Other adjustments to profit/(loss) (net)26(29,045)(28,167)Changes in working capital15(691,404)285,270 Other cash flows from operating activities(53,956)40,987 Dividend collections70,243 40,248 Collections/(Payment) for income tax (124,199) 739 TOTAL CASH FLOWS FROM OPERATING ACTIVITIES 785,386 1,545,839 Payments due to investments(1,104,585)(1,062,055)Group companies, associates and business units(152,231)(286,413)Property, plant and equipment, intangible assets and real estate investments6, 7 and 8(851,436)(622,914)Other financial assets(100,918)(152,728)Proceeds from disposals36,211 51,512 Group companies, associates and business units16,681 19,086 Property, plant and equipment, intangible assets and real estate investments6, 7 and 814,191 20,619 Other financial assets5,339 11,807 Other cash flows from investing activities105,938 72,498 Interest received46,641 29,292 Other collections/(payments) from investing activities59,297 43,206 TOTAL CASH FLOWS FROM INVESTMENT ACTIVITIES (962,436) (938,045)1.

Consolidated Group | Statement of consolidated cash flows (indirect method) | Page 1 of 2

Statement of consolidated cash flows (indirect method)

FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023 (in thousands of euros)

277

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report Notes31/12/202331/12/2022Proceeds from and payments for equity instruments17575,242 (39,429)Issue/(redemption)(419)(331)(Acquisition)/disposal of own shares575,661 (39,098)Proceeds from (payments on) financial liabilities19(113,844)(333,882)Issuance2,112,503 2,341,595 Repayment and amortisation(2,226,347)(2,675,477)Dividends paid and payments on equity instruments5(80,785)(73,177)Other flows from financing activities(170,355)(120,708)Interest paid(172,456)(123,682)Other collections/(payments) from financing activities 2,101 2,974 TOTAL CASH FLOWS FROM FINANCING ACTIVITIES 210,258 (567,196) EFFECT OF VARIATIONS IN EXCHANGE RATES 957 (585) NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 34,165 40,013 Cash and cash equivalents at the start of the period161,575,538 1,535,525 Cash and cash equivalents at the end of the period16 1,609,703 1,575,538 278

Consolidated Group | Notes to the consolidated financial statements | Page 1 of 139

Notes to the consolidated financial statements
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023

1. Group activity

2. Basis of presentation and basis of consolidation of the consolidated

income statement

3. Accounting policies

4. Changes in the scope of consolidation

5. Distribution of profit/loss

Intangible assets

7. Property, plant and equipment

Investment property

9. Leases

10. Service concession arrangements

11. INvestments accounted for using the equity method

12. Joint agreements. Joint operations

13. Non-current financial assets and other current financial assets

14. Inventories

15. Commercial debtors, other accounts receivable and other current assets

16. Cash and cash equivalents

17. Equity

18. Non-current and current provisions

19. Non-current and current financial liabilities

20. Other non-current liabilities

21. Trade and other accounts payable

22. Derivative financial instruments

23. Tax matters

24. Pension plans and similar obligations

25. Guarantee commitments to third parties and other contingent liabilities

26. Income and expenditure

27. Information by activity segments

28. Environmental information

29. Financial and non-financial risk management policies

30. Information on transactions with related parties

31. Fees paid to auditors

32. Events after the closing date

Annex I Fully consolidated subsidiaries

Annex II Companies jointly controlled with third parties outside

the Group (consolidated using the equity method)

Annex III Associates consolidated using the equity method

Annex IV Changes in the scope of consolidation

Annex V Temporary Joint Ventures and other contracts jointly managed

with third parties outside the Group

343

344

347

352

354

356

360

370

372

378

383

384

397

400

405

406

279

281

289

293

294

299

302

304

306

311

318

320

323

325

331

334

343

1. Group activity

The FCC Group comprises the parent company Fomento de Construcciones y Contratas, S.A. and a group
of national and international investee companies.

279

• Construction. Specialised in the construction of infrastructure, buildings and similar facilities:

motorways, highways, roads, tunnels, bridges, hydraulic works, ports, airports, urban developments,
housing, non-residential building, lighting, industrial climate control installations, environmental
restoration, etc.

• Real Estate. Dedicated to the promotion of housing and the rental of offices, commercial premises and

residential properties.

Company identification data

Name of the reporting entity or other means of
identification

Legal form of the entity

Fomento de Construcciones y Contratas, S.A.

• Cement. Dedicated to the operation of quarries and mineral deposits, manufacture of cement, lime,

gypsum and prefabricated derivatives, and also to the production of concrete and mortar.

Public Limited Company (In Spain: Sociedad
Anónima)

• Concessions. Mainly includes concession agreements related to the operation of motorways, tunnels

and other similar infrastructures and urban tramways.

Address of the entity's registered office

C. Balmes 36, 08007 Barcelona, Spain

Address of the entity

Country of incorporation

Main place of business

Avenida Camino de Santiago 40, 28050, Madrid,
Spain

Spain

Name of the parent company

Control Empresarial de Capitales, S.A. de C.V.

Name of the controlling parent of the Group

Control Empresarial de Capitales, S.A. de C.V.

Changes to the name of the reporting entity

No changes have occurred this year

The Group operates in the following business Areas:

• Environmental Services. Services related to urban sanitation, industrial waste management, green

space conservation, including both construction and operation of treatment plants, and energy recovery
from waste. This includes concession agreements related to environmental services.

• End-to-end Water Management. Services relating to the end-to-end water cycle: collection, purification
and distribution of water for human consumption; sewage collection, filtration and purification; design,
construction, operation and maintenance of water infrastructure for municipal, industrial, agricultural
services etc. Concession agreements related to the integral water cycle are also included.

International activities account for approximately 48% (45% in 2022) of the FCC Group's turnover, mainly in
Europe, Latin America, the Middle East and the United States (note 27).

2. Basis of presentation and basis of consolidation
of the consolidated income statement

a) Basis of presentation

The accompanying financial statements and the notes thereto that comprise this Report and which make
up these consolidated financial statements have been prepared in accordance with the International
Financial Reporting Standards (IFRS) adopted by the European Union at the closing date, in accordance
with Regulation (EC) No. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and all
the implementing provisions and interpretations.

The 2023 consolidated financial statements of the FCC Group have been formulated by the Board of
Directors of Fomento de Construcciones y Contratas, S.A. and will be presented for approval by the
General Shareholders' Meeting. However, no amendments are expected as a result of the fulfilment of said
requirement. The 2022 consolidated financial statements were approved by the General Shareholders'
Meeting of Fomento de Construcciones y Contratas, S.A., held on 14 June 2023.

These consolidated financial statements of the FCC Group show the faithful image of the equity and the
financial situation as at 31 December 2023 and 2022, as well as the results of the operations, changes in
equity and consolidated cash flows that occurred in the Group during those years.

280

The consolidated financial statements of the FCC Group have been prepared from the accounting records
of Fomento de Construcciones y Contratas, S.A. and its investee companies. These records, in accordance
with the procedures and operating systems established in the Group, justify and support the consolidated
financial statements prepared in accordance with current international accounting regulations.

In order to uniformly present the various items composing these consolidated financial statements,
accounting standardisation criteria were applied to the individual financial statements of the companies
included in the scope of consolidation. In 2023 and 2022, the reporting date of the financial statements
of the companies included in the scope of consolidation was the same as that of the Parent, i.e. 31
December.

The consolidated financial statements are expressed in thousands of euros.

Reclassifications made

There were no significant reclassifications in business years 2023 and 2022.

Rules and interpretations issued but not in force

The Group intends to adopt standards, interpretations and amendments to standards issued by the
IASB, which are not mandatory in the European Union, when they become effective, if applicable to it.
Although the Group is currently analysing its impact, based on its analysis to date, it believes that its initial
application will not have a significant impact on its consolidated financial statements.

Significant rules and interpretations applied in 2023

The standards and interpretations applied in the preparation of these consolidated financial statements
are the same as those applied in the consolidated financial statements for the year ended 31 December
2022, as none of the standards, interpretations or amendments that are applicable for the first time in this
financial year have had a significant impact on the Group's accounting policies.

Worth mention is the amendment to IAS 1 “Presentation of financial statements”, establishing that only
material accounting policies must be disclosed, a criteria that the Group has applied in these consolidated
financial statements.

IAS 12 “Income tax” has also been amended in relation to the new tax regulations of the Second Pillar
of the OECD Inclusive Framework. These amendments provisionally introduce a mandatory temporary
exemption for the accounting and breakdown of deferred taxes arising from said legislation. This
amendment also requires additional disclosures to facilitate an understanding of the exposure to these tax
regulations. Note 23 provides a qualitative description of the expected impact of these regulations.

b) Basis of consolidation

Subsidiaries

Consolidation performed applying the global integration method for the subsidiaries indicated in Annex I,
over which Fomento de Construcciones y Contratas, S.A. exercises control

The value of the participation of non-controlling shareholders in equity is presented under the heading
"Non-controlling interests" of the liability side of the accompanying consolidated balance sheet and
the participation in the profit/(loss) is presented under the heading "Profit attributed to non-controlling
interests" of the accompanying consolidated income statement.

Where appropriate, goodwill is determined in accordance with the provisions of Note 3.b) of this Report.

Joint agreements

The Group develops joint agreements through participation in joint ventures jointly controlled by one of
more of the FCC Group companies with other companies outside the Group (note 11), as well as through
participation in joint operations, temporary joint ventures and other similar entities (note 12).

The Group applies its professional judgement to evaluate its rights and obligations over joint agreements
taking into account the financial structure and legal form of the agreement, the terms agreed by the parties
and other relevant facts and circumstances to evaluate the type of joint agreement.

In accordance with IFRS 11 "Joint agreements", participations in joint ventures are integrated according to
the equity method and are included in the accompanying consolidated balance sheet under the heading
"Investments accounted for using the equity method". These companies' participation in the net income of
the business year is included under the heading "Profit/(loss) of entities valued using the equity method" of
the accompanying consolidated profit and loss statement.

The joint operations, mainly in the Construction and Environmental Services activities that mostly take
the form of temporary joint ventures and other similar entities, have been integrated in the attached
consolidated accounts based on the percentage of participation in assets, liabilities, income and expenses
derived from the operations carried out by them, eliminating the reciprocal balances in assets and
liabilities, as well as the income and expenses not incurred against third parties.

Annexe II lists the business jointly controlled with third parties outside the Group and Annexe V lists the
joint operations carried out with third parties outside the Group, mainly through temporary joint ventures
and other entities with similar characteristics.

281

Associates

3. Accounting policies

The companies listed in Annexe III, in which Fomento de Construcciones y Contratas, S.A. does not
exercise control but has significant influence, are included in the accompanying consolidated balance
sheet under the heading "Investments accounted for by applying the equity method", integrated using
said method. These companies' contribution to the net income for the year is included under the heading
“Profit/(loss) of entities valued using the equity method” of the accompanying consolidated income
statement.

Transactions between Group companies

In transactions between consolidated companies, the profit/(loss) of internal operations are eliminated,
being deferred until they are made against third parties outside the Group. This elimination does not apply
in the "Concession agreements" since the result is considered to be realised against third parties (note 3.a).

Group work on its own fixed and non-current assets is measured at production cost, eliminating the intra-
group profit/(loss).

Reciprocal credits and debits have been eliminated from the consolidated financial statement, as well as
internal income and expenses from the collection of the subsidiaries that are consolidated.

Changes in the scope of consolidation

Annex IV shows the changes made in 2023 in all consolidated companies using global integration and the
equity method. The profit/(loss) of these companies are included in the consolidated income statement as
from the effective acquisition date or until the effective disposal or derecognition date, as appropriate.

The heading "Change in scope" in the corresponding notes to this Report shows the effect of the additions
and derecognitions of companies from the scope of consolidation. Additionally, Note 4 of this Report
"Changes in the scope of consolidation", shows the most significant inputs and outputs of said scope.

The most relevant accounting policies applied to the consolidated financial statements of the FCC Group
are detailed below:

a) Service Concession Arrangements

Concession contracts involve agreements between a granting public entity and FCC Group companies to
provide public services such as water distribution, filtration and sewage treatment, landfill management,
motorways and tunnels, etc. by operating the infrastructure. Meanwhile, revenue from providing the service
may be received directly from the users or, sometimes, through the concession grantor itself, which
regulates the prices for providing the service.

The Group recognises its concessions pursuant to the provisions of IFRIC 12 "Service Concession
Arrangement".

Intangible assets from concession arrangements classified as intangible assets amortise the resulting
asset according to the consumption pattern, understanding as such the performance and best estimation
of the production units in each of the different activities. The Group's most important concession
businesses are in the water supply and sanitation business, which depreciates its assets based on
water consumption, which, in general, remains constant over time due, on the one hand, to a reduction
in water consumption as a result of water saving policies and, on the other hand, to an increase in water
consumption as a result of population growth; in the environmental services business, mainly waste
recycling and energy recovery plants, which are depreciated on the basis of the tonnes treated; and in the
concessions business, mainly toll roads and motorways, which are depreciated on the basis of traffic.
The amortisation is completed in the concession period, which is generally between 25 and 50 years. In
turn, Concession arrangements recognised as financial assets are measured applying the amortised cost
method.

282

b) Business combinations and goodwill

d) Property, Plant and Equipment

Goodwill is recognised as the positive difference between (a) the sum of the fair value of the consideration
transferred as a result of the acquired interest, the amount of the non-controlling interests and the fair
value at the date on which control over these interests is acquired when control is obtained in stages, and
(b) the fair value of identifiable assets and liabilities.

Property, plant and equipment are recorded at their cost price, less accumulated depreciation and any loss
due to impairment of recognised value. The cost of those assets includes the estimated present value
of their dismantling or the withdrawal of the affected items and, in those cases in which they have been
acquired by business combinations, they are initially recognised at their fair value on the acquisition date.

When the difference obtained according to the previous paragraph is a negative amount, a bargain
purchase occurs. In these situations, the Group reviews the identification and assessment of the assets
and liabilities acquired and if this difference is confirmed, it is recognised as a positive result in the year
under "Impairment and gains/(losses) on disposals of fixed assets".

In general, non-controlling interests are valued by the proportional part of the fair value in the assets and
liabilities of the acquired company.

c) Intangible assets

Except as indicated in the two previous sections of this note regarding the agreements for the concession
of services and goodwill, the other intangible assets contained in the accompanying financial statements
are initially recognised at their acquisition cost. These intangible assets include investments related to
operating contracts and licences, rights to build and software applications.

Such registered intangible assets have a finite useful life. Amortisation is carried out during its useful life,
which is generally between 20 and 35 years, that is, the period during which it is estimated that they will
generate income, using the linear method, except when the application of the consumption pattern reflects
its depreciation more faithfully. Software applications are generally amortised within a period of 5 to 10
years.

The Group records CO2 emission rights as a non-amortisable intangible asset. Rights received free of
charge under the corresponding national allocation plans are measured at the market price in force at the
time they are received, recognising a subsidy for the same amount. Pursuant to the option provided by the
regulations, the intangible asset is reduced by the subsidy received.

Companies depreciate their fixed and non-current assets following the linear method, distributing the cost
thereof between the following years of estimated useful life:

Natural resources and buildings

Plant, machinery and transport items

Furniture and tools

Other fixed and non-current assets

25-100

5-30

7-12

5-10

However, some contracts may have terms shorter than the useful life of the related fixed and non-current
assets, in which case they are depreciated over the term of the contract.

The residual value, useful life and depreciation method applied to the Group’s PP&E are reviewed
periodically to ensure that the depreciation method used reflects the pattern in which the revenue deriving
from operating the property, plant and equipment. This review is carried out through an in situ evaluation
and technical analysis, taking into account their current conditions and estimating the remaining useful life
of each asset, based on their ability to continue providing the functionalities for which they were defined.
Subsequently, these internal analyses are compared against third parties outside the Group, such as
manufacturers, installers, etc. to ratify them.

e) Investment property

Real estate investments, or investment property, is land, buildings and other structures that are held either
for rental or for capital appreciation as a result of future increases in their respective market prices.

Investment property is stated at fair value at the reporting date and is not subject to depreciation. Gains
or losses arising from changes in the fair value of investment property are included in profit or loss for the
period in which they arise and are recognised under "Changes in value, impairment and gains/(losses) on
disposal of fixed assets" in the accompanying consolidated income statement.

The Group periodically determines the fair value of investment property so that, at year-end, the fair value
reflects the market conditions of the investment property items at that date. This fair value is determined
half-yearly on the basis of the assessments made by independent experts.

Impairment of the property, plant and equipment
and intangible asset value

The Group uses both internal and external sources of information to assess possible signs of impairment.
External sources include market value decreases beyond the passage of time or normal use or possible
adverse future changes in the legal, economic or technological environment that could reveal a loss of
the recoverable value of its assets. The Group internally assesses whether there has been a physical
deterioration or obsolescence of the assets, if the future situation itself may produce a change in the
expected use of the asset, for example if the asset is expected to be idle for a significant period of time or
due to restructuring plans or if it is detected that the return on the asset is worse than expected.

The recognition or reversal of impairment losses on assets are charged or credited to income under
“Impairment and results obtained on the disposal of assets”.

To calculate the recoverable amount of the assets subject to impairment tests, the present value of the
net cash flows originating from the Cash Generating Units (CGUs) associated therewith was estimated,
except those flows related with payments or collections on lending operations and corporate income tax
payments, together with those that arise from future improvements or refurbishments envisaged for the
assets belonging to such Cash Generating Units. To discount cash flows, a pre-tax discount rate was used,
which includes the current market assessments of the time value of money and the risks specific to each
Cash Generating Unit.

The estimated cash flows are obtained from the projections made by the Directorate of each of the CGUs
that generally use periods of five years, except when the business characteristics advise longer periods
and that include growth rates supported by the different approved business plans, whose review is carried
out periodically, generally considering zero growth rates for those periods beyond the years projected in
the aforementioned plans, except in exceptional cases when the expected future growth of the activities
performed by the CGU justify the inclusion of a growth rate. Also, it is necessary to indicate that sensitivity
analyses are performed to assess the growth of income, operating margins, and discount rates, in order to
foresee the impact of future changes in these variables.

Cash flows from CGUs located abroad are calculated in the functional currency used by those cash
generating units and they are updated using discount rates that take into consideration the risk premium
relating to each currency. The present value of the net cash flows obtained in this manner are translated at
the year-end exchange rate for each currency.

283

g) Leases

To estimate the duration of the contract, extensions that are reasonably expected to occur and the period
in which the lessee does not expect to terminate the contract (when they have the power to do so) are
considered, without exclusively taking into account the minimum term established in the contract, as the
term during which the lessee expects to continue using the underlying asset, depending on its particular
circumstances, is estimated. To determine whether an extension is expected to take place, the economic
incentives that the lessee may have to extend the contract are taken into account, considering factors
such as the existence of advantageous conditions compared to market conditions in case of an extension,
if the lessee has incurred significant costs in adapting the underlying asset to its needs that it must reapply
in case of contracting a new lease, any possible costs for the termination of the contract in case it is not
extended or the importance of the asset to the lessee, especially If it is a specialised asset that is not
readily available on the market. Furthermore, the background in terms of the period of use in the past of
certain assets is also taken into account.

Substantially all of the agreements in which the Group acts as lessor, which are mostly carried out
in the Real Estate business, are classified as operating leases, as not substantially all the risks and
rewards incidental to ownership of the asset are transferred. The revenue generated by the agreement is
recognised on a straight-line basis over the term of the agreement and is included as revenue in the profit
and loss account to the extent that it is of an operating nature. Direct costs incurred on entering into a
lease agreement are incorporated as an increase in the value of the leased asset and amortised over the
lease term on the same basis as income. Contingent payments are recognised as income in the period in
which they are earned.

h) Investments accounted for using the equity method

Investments undergo an impairment test as long as there are indications of impairment that may reveal
a decrease in the recoverable value below the carrying amount of the investment, using both internal and
external sources.

284

i) Financial assets

Inventory

All acquisitions and sales of financial assets are recorded at the date of contracting the operation.

The Group manages its financial assets to obtain its contractual cash flows, which is why it measures
them applying the amortised cost method. As an exception to the above, it should be noted that the Group
values certain financial assets at fair value in the following cases:

• Financial assets at fair value with changes in profit/(loss): This category includes derivatives that do
not meet the conditions to be considered as hedging, financial assets that other standards establish
must be valued at fair value charged to profit/(loss), such as contingent considerations in business
combinations and financial assets that, if valued differently, would generate an accounting asymmetry.

• Financial assets at fair value with changes in other comprehensive income: The Group values its

interests in companies in which it does not have control, joint control or exert significant influence at fair
value charged to reserves.

In assets that are valued at amortised cost, an impairment loss is recorded if, on the closing date of the
financial statements, it is determined that credit losses will be incurred throughout their entire life. That is,
impairment losses are recorded immediately when there is credit risk. Credit risk is understood as the risk
of one of the parties to the financial instrument causing a financial loss to the other party if it breaches an
obligation.

Collection rights arising from a service concession agreement are measured at their amortised cost.

Trade receivables arising in the Group’s normal business activities are stated at their nominal value, given
that they generally mature within twelve months, adjusted by any expected credit losses over the course
of their lives. Accounts receivable with maturities greater than twelve months are valued at their current
value.

The Group, based on the short-term cash flow needs, transfers credit from customers to financial entities.
The amount of the aforementioned credit assignments is reported in note 15.a). These operations accrue
interest under usual market conditions and the collection management is still carried out by the Group
companies, although the costs associated with such management are residual.

To the extent that the risks and rewards inherent to the accounts receivable are substantially transmitted
through these sales and assignments of collection rights, as well as the control over them, without there
being any repurchase agreements signed between the Group companies and the credit institutions
that have acquired the assets and that they can freely dispose of said acquired assets without the
Group companies being able to limit the aforementioned right in any way, the aforementioned sales and
assignments are posted as "without recourse". Consequently, in accordance with the criteria established
by IFRS, balances receivable from debtors assigned or sold under the conditions indicated are written off
in the consolidated balance sheet.

Inventory is valued at the average acquisition price or the average production cost, applying the necessary
value corrections to adapt these values to the net realisable value if it were lower.

The Group's real estate activity includes land and plots, as well as ongoing developments and finished
properties that are held for sale or for integration into a real estate development. Land and plots are
valued at their acquisition price, plus any urbanisation costs and other expenses related to their purchase
(property transfer tax, registration fees etc.) and the financial costs of their financing during execution of
the works, or their recoverable amount if this is less.

Ongoing developments are the costs incurred in real estate development, or part thereof, whose
construction has not been completed at the end of the business year. The cost of completed real estate
developments is classified as finished products.

Impairment of land and plots, ongoing real estate developments and finished products is recorded when
their net realisable value is lower than their book value (note 14). To determine the book value, the Group
uses the assessments made by independent experts. This is determined mainly on the basis of end-
market references, by calculating the residual value of the land on the existing market value in the locality
in which they are located and, where appropriate, when purchase offers have been received, the price of
such offers has been used for their assessment.

The goods received through credit collection in exchange for work executed or to be executed are valued
at the lowest amount from between the amount that was registered for the credit corresponding to the
goods received, or the cost of production or net realisable value.

k) Foreign currency

k.1) Translation differences

Converting the financial statements of foreign companies denominated in currencies other than the euro
into euros has generally been carried out at the closing rate, except for:

• Capital and reserves, which were converted at historical exchange rates.

• The income statement items of foreign companies have generally been converted applying the daily

exchange rates, or average exchange rates when the daily exchange rate cannot be used.

Translation differences for the foreign companies from the consolidation scope, generated by the
application of the year-end exchange rate method, are included in the equity of the accompanying
consolidated balance sheet, as shown in the accompanying statement of changes in the equity.

285

k.2) Exchange differences

The balances of accounts receivable and payable from monetary items in foreign currency are valued in
euros by applying the exchange rates in force at the date of the consolidated balance sheet, allocating the
differences that are generated to profit/(loss), except as regarding advances, which, when considered non-
monetary items, are kept converted at the exchange rate that existed at the time of the transaction.

The differences resulting from fluctuations in exchange rates between the date on which the collection or
payment was made and the date on which the transactions took place or their value was discounted are
allocated to profit or loss.

Meanwhile, the exchange differences that occur in relation to the financing of investments in foreign
companies, with both the investment and the financing being registered in the same currency, are directly
recognised in equity as translation differences that offset the effect of the difference in conversion to
euros of the foreign company.

l) Equity instruments

Equity or capital instruments are recorded for the amount received, net of direct issuance costs.

The treasury shares acquired by the Parent Company during the year are recognised at the value of the
consideration given, as a decrease in equity. Any gains or losses on the purchase, sale, issue or redemption
of own equity instruments are recognised directly in equity and never in the profit and loss statement.

m) Grants

Subsidies are accounted for based on their nature as capital subsidies when they involve the acquisition or
construction of assets or as operating subsidies when they cover operating deficits.

n) Provisions

In addition, some Group companies provide provisions for restructuring costs when there is a detailed
formal plan for such restructuring that has been communicated to the affected parties. As at 31 December
2023 no liabilities of a substantial amount have been recognised for this item.

Provisions are classified as current or non-current in the accompanying consolidated balance sheet on
the basis of the estimated maturity date of the obligation covered by them, and non-current provisions are
considered to be those whose estimated maturity date exceeds the normal operating cycle of the activity
giving rise to the provision.

o) Financial liabilities

Borrowing costs are recognised on an accrual basis in the income statement using the effective interest
method and are added to the amount of the instrument to the extent that they are not settled in the year in
which they arise.

Bank borrowings and other current and non-current financial liabilities maturing within no more than 12
months from the balance sheet date are classified as current liabilities and those maturing within more
than 12 months as non-current liabilities.

The Group undertakes reverse factoring operations with suppliers (note 21); in general, as these operations
do not entail a release of the payment obligation, the value of the liability is not derecognised.

p) Financial derivatives and hedge accounting

The Group applies the treatment established in the regulations to derivatives that meet the requirements
to be considered as hedges, classifying the hedges as cash flow, fair value or net investment hedges of
foreign businesses.

IFRS 9 "Financial Instruments" states that an effectiveness test must be performed, consisting of a
qualitative assessment of the financial derivative to determine whether it can be considered to be a
hedging instrument and, therefore, effective.

These provisions are recognised when the related obligation arises and the amount recognised is the
best estimate, at the date of the accompanying financial statements, of the present value of the future
expenditure required to settle the obligation. The change in the year relating to the discount to present
value has an impact on financial profit/(loss).

A quantitative analysis that will determine how the instruments are recognised takes place after their
effectiveness has been assessed. This quantitative analysis consists of a retrospective portion for purely
accounting purposes and another prospective portion intended to analyse any possible future deviations
relating to the hedge.

Provisions for dismantling, removal or restoration are recognised by increasing the value of the related
asset by the present value of the expenses that will be incurred when operation of the asset ceases. Profit
or loss is affected when the asset concerned is depreciated as described in previous sections of this Note
and by the discounted present value as described in the preceding paragraph.

The retrospective assessment analysis is adapted to the type of the hedge and the nature of the
instruments used, and all of the financial derivatives contracted by the Group consist of cash flow hedges
(note 22):

286

• In the case of interest rate swaps (IRSs) in Cash flow hedges, the Group charges a variable rate equal

to that of the hedged borrowings and pays a fixed rate, since the objective is to reduce the variability of
the borrowing costs, the effectiveness test determines whether changes in the fair value of the IRS cash
flows offset changes in the fair value of the hedged risk.

The hypothetical derivative method is used for accounting purposes when performing the quantitative
assessment of effectiveness, which establishes that the company will recognise in equity the lower of
the absolute change in the value of the hypothetical derivative (hedged position) and the change in the
value of the contracted derivative. The difference between the value of the recognised change in equity
and the fair value of the derivative on the date of the effectiveness test will be considered to be the
ineffective portion and it will be directly recorded in the income statement.

• Cash flow hedges in which the derivative hedge instrument is an option or a forward and not an IRS are

treated in a similar way as described for IRS transactions.

The value is calculated using defined methods and techniques based on observable market inputs, such as:

• The interest rate swaps were measured by discounting all the flows envisaged in each contract on the

basis of its characteristics, such as the notional amount and the collection and payment schedule. This
measurement was made using the zero-coupon rate curve determined by employing a bootstrapping
process for the deposits and swaps traded at any given time. This zero-coupon rate curve was used to
obtain the discount factors for the measurements, which were made assuming the absence of arbitrage
opportunity (AAO). When there were caps and floors or combinations thereof, on occasions conditional
upon special conditions being met, the interest rates used were the same as those used for the swaps,
although in order to introduce the component of randomness in the exercise of the options, the generally
accepted Black - Scholes model was used.

• The methodology used in the case of a cash flow hedge derivative associated with inflation is very

similar to that used for interest rate swaps. Expected inflation is estimated based on observed inflation
and is embedded in the swamps indexed to the ex-tobacco European inflation rate used in the market,
and translated to the Spanish rate using a convergence adjustment.

Furthermore, a sensitivity test is carried out on the derivatives and net financial debt in order to be able to
analyse the effect that a possible fluctuation in interest rates might have on the Group's accounts, given
different interest rate increase and decrease scenarios at year-end (Note 29).

Note 22 to this Report provides details of the financial derivatives that the Group has arranged and other
matters related thereto.

q) Income tax

The expense for corporate income tax is calculated on the basis of the consolidated profit before tax,
increased or decreased, as appropriate, by the permanent differences between tax loss/taxable profit and
accounting profit/(loss). The corresponding tax rate based on the legislation applicable to each country
is applied to this adjusted accounting profit. The tax relief and tax credits earned in the year are deducted
and the positive or negative differences between the estimated tax charge calculated for the prior year’s
accounting close and the subsequent tax settlement at the payment date are added to or deducted from
the resulting tax charge.

The temporary differences between accounting profit/loss and taxable profit/tax loss for Corporate
Income Tax purposes, together with the differences between the carrying amounts of assets and liabilities
recognised in the consolidated balance sheet and their tax bases, give rise to deferred taxes that are
recognised as non-current assets and liabilities. These amounts are measured at the tax rates that are
expected to apply in the years in which they will foreseeably be reversed, without performing financial
discounting at any time.

The Group activates deferred asset taxes corresponding to temporary differences and negative tax bases
to be offset, except in cases where there are reasonable doubts about their future recovery.

r) Pension commitments

The Group companies have certain specific cases related to pension plans and similar obligations that are
developed in Note 24 of this Report.

s) Operating income and expenses

After analysing its portfolio of contracts, the Group has concluded that, except in very specific cases, After
analysing its portfolio of contracts, the Group has concluded that, except in very specific cases, there is no
more than one performance obligation in the contracts being executed, since either integration services
are provided for the different activities carried out, or because they are highly interrelated.

As regards variable consideration, only one income is recognised for the value, and it is highly probable
that it will not suffer significant reversion when the uncertainty about it is subsequently resolved. Also, in
the case that the contracts include price revision clauses, the income that represents the best estimate of
the amount to be charged in the future and under the same probability criteria mentioned for the variable
consideration is recorded.

287

In general, the Group has not identified significant financial components in its contracts with customers.
The financial component is only separated from the consideration to be received and the corresponding
financial income is recorded in those contracts in which the time between when a service is provided or a
good is delivered and when the payment is received is greater than twelve months.

Regarding the delivery of goods activities that the Group mainly carries out in the Cement segment and
in the Real Estate activity, revenues are only recognised when the goods have been delivered and their
property has been transferred to the customer, as they are performance obligations that are satisfied at a
specific moment of time.

In the construction activity, performance obligations are paid over time, so revenue is recognised using
a product-based method, i.e. that is in-line with the degree of progress criterion. Only income that is
protected by a main contract signed with the property and in modifications thereto approved by it is
recognised. If the modification is approved without the amount being fixed, the income is only estimated
as a variable consideration when the criteria of probability and significant non-reversal mentioned above
are met. Budgeted losses are recognised as profit/(loss) for the year.

Meanwhile, in this activity the costs are recognised in accounts according to their accrual. The costs for
obtaining the contract, mainly related to the study and preparation of the project, are not activated as
they cannot be considered as incremental, since they are incurred regardless of whether the contract
is finally obtained or not. Two main costs for fulfilling the contract can be distinguished: engineering
and study costs and those related to general and specific facilities (mainly accessory facilities such as
concrete plants, auxiliary works or building booths necessary to provide the services). The main contracts
in which the aforementioned expenses are incurred are of the design and construction type, in which the
remuneration to be received for the work to be carried out in engineering and studies and those of the
benefit is identified by separate work units of construction services. Therefore, in general, expenses arising
from engineering and studies are not capitalised and recognised as they are accrued as the services
are provided, unless the agreement includes a clause stipulating that these costs will be reimbursed
regardless of whether they the contract is closed or not. Costs related to the general and specific facilities
are recorded as expenses according to the degree of progress when a separate works unit with its
corresponding remuneration is identified in the contract, and assets are only activated within the heading
when the contract does not identify them separately, and profit/(loss) is charged together with the rest of
the contract costs using the aforementioned of progress.

In the service provision activities, which are mainly carried out in the Environmental Services, End-to-end
Water Management and Real Estate segments when the Group acts as lessor under lease agreements,
income and expenses are recognised on an accrual basis, i.e. when the actual flow of the goods and
services they represent occurs, regardless of when the resulting monetary or financial flow arises. These
are performance obligations that are satisfied over time as the customer receives and consumes the
profits at the same time as the service is provided. Consequently, revenue is recognised by measuring the
value of the services actually provided to the customer using a product-based method.

In the Real Estate activity, the Group recognises the costs passed on to tenants of its investment property
as income under "Other operating income" in the accompanying consolidated income statement (note
9.b).

In the aforementioned activities (other than construction), the costs of obtaining the contract are not
incremental, so they are not activated and are recognised based on their accrual. Meanwhile, no relevant
contract fulfilment costs are incurred and are therefore recorded as operating expenses in general.

With regard to the service concession agreements, it should be noted that the Group recognises the
interest income derived from the collection rights of the financial model as Revenue, since the value of
this financial asset includes both construction and maintenance and upkeep services, which from an
operational point of view are identical to those represented by the intangible model and, consequently, it is
considered that since both models are related to the company's operating activity, the true and fair view is
better represented by including the income derived from the financial asset as belonging to operations.

The Group has entered into "Power Purchase Agreements" and supply contracts, mainly in the Cement
and End-to-End Water Management Areas, which ensure the supply of certain amounts of renewable
energy for a determined period of time at the fixed price in the contract. These contracts are considered
to be for own use as they are entered into with the intention of covering the activity's future electricity
consumption needs. There is a high correlation between the expected future consumption and the volume
of energy arranged. An operating expense is taken to the income statement when the energy in question is
effectively consumed.

Also recognised as operating profit/(loss) are those produced in the disposals of shares in subsidiaries
when it implies the loss of control over them.

t) Related party transactions

The Group performs all of its transactions with related parties on an arm’s length basis.

Note 30 of this Report details the main transactions with significant shareholders of the Parent Company,
with administrators and senior executives, between companies or Group entities and with companies
invested in by shareholders of the Group.

u) Consolidated statement of cash flows

The FCC Group prepares its statement of cash flows in accordance with IAS 7 "Statement of cash flows"
following the indirect method, using the expressions below in the following ways:

• Cash flows are the inflows and outflows of cash and cash equivalents.

• Operating activities are the activities that constitute the main source of the company's ordinary income,

and also other activities that cannot be classified as investment or financing activities. Among the
operating cash flows, it is worth highlighting the heading “Other adjustments to profit/(loss)”, which
basically includes items that are included in “Profit/(loss) before tax” but have no impact on the change
in cash, as well as items that are already included in other headings of the statement of cash flows
according to their nature.

• Investing activities are the acquisition and disposal of long-term assets, as well as other investments

not included in cash and cash equivalents.

• Financing activities are the activities that generate changes in the size and composition of own capital

and loans taken by out the Group.

For the purposes of preparing the consolidated statements of cash flows, the "cash and cash equivalents"
have been considered as cash and on-demand bank deposits, as well as those short-term, highly liquid
investments, which are easily convertible into specific amounts of cash, subject to an insignificant risk of
changes in their value.

v) Use of estimates

In preparing these 2023 and 2022 Group consolidated financial statements, estimates were made to
quantify certain assets, liabilities, revenues, expenses and obligations recognised therein. These estimates
relate essentially to the following:

• Impairment losses on certain assets (Notes 6, 7, 8, 11 and 13)

• Goodwill measurement (Note 6)

• The recoverability of the work executed pending certification (notes 3.s and 15)

• The recoverability of deferred tax assets (Note 23)

288

• The amount of certain provisions and, in particular, those related to claims and litigation and the losses

budgeted in construction contracts (note 18)

• The useful life of PP&E and intangible assets (see Notes 6 and 7)

• The determination of the fair value of investment property (note 8)

• The determination of the recoverable amount of inventory (note 14)

• The assumptions used in the actuarial calculation of liabilities and commitments for post-employment

compensation (notes 18 and 24)

• The market value of derivatives (note 22)

• Cost of business combinations (note 4)

Although these estimates have been made based on the best information available at the date of preparing
these consolidated financial statements on the events analysed, it is possible that events that may take
place in the future may require them to be modified (upwards or downwards) in future years, which would
be done prospectively, recognising the effects of the change in estimate in the corresponding future
financial statements.

IFRS 7 "Financial instruments: information to be disclosed" requires that the fair value valuations of
financial instruments, both assets and liabilities, be classified according to the relevance of the variables
used in the valuation, establishing the following hierarchy:

• Level 1: quoted prices (unadjusted) in active markets for identical instruments.

• Level 2: inputs other than prices quoted that are observable for the financial instrument, either directly

(i.e., as prices) or indirectly (i.e., derived from prices).

• Level 3: data for the financial instrument that are not based on observable market data.

Almost all of the Group's financial assets and liabilities, which are valued at fair value, are level 2.

289

4. Changes in the scope of consolidation

The reconciliation between the consideration transferred for the above business combination, the value of
non-controlling interests recognised and the fair value of the net assets acquired are provided below:

The main changes experienced in the scope of consolidation in 2023 are the following:

a) Business combinations

On 31 December 2023, FCC Aqualia USA Corp. acquired 97% of the shares in Municipal District Services,
Llc. in the United States for the sum of 81,433 thousand euros. This investment was paid out in January
2024, meaning it does not appear as an investment in the accompanying Statement of Cash Flows.
Furthermore, there is a put option in favour of the non-controlling interests and a call option in favour of
FCC Aqualia USA Corp. for the 3% stake held by the non-controlling interest, the fair value of which has
been recorded as a financial liability (note 19).

The composition of the balance sheet resulting from the aforementioned business combination is as
follows:

2023 Financial Year

Acquisition value

Fair value Minority interests acquired

Fair value previous interest

- Fair value of net assets

Valuation put non-controlling interests

Goodwill/Negative consolidation difference

Municipal District Services, Llc.

81,433

3,610

85,118

As Municipal District Services, Llc. was acquired at the end of 2023, it has contributed no ordinary income
or profit to the accompanying statement of profit and loss. Had the company been consolidated since 1
January 2023, the revenue and profit/(loss) it would have contributed would have been as follows:

2023

Non-current assets

Intangible assets

Property, plant and equipment

Current assets

Inventory

Trade and other receivables

Cash and cash equivalents

Total assets

Equity

Non-current liabilities

Non-current financial liabilities

Current liabilities

Trade and other payables

Total equity and liabilities

Municipal District Services, Llc.

2023

Municipal District Services, Llc.

87,085

85,118

1,967

9,310

913

7,040

1,357

96,395

81,508

2,443

12,444

96,395

Importe neto de la cifra de negocios

Otros ingresos

Resultado de Explotación

Resultado antes de impuestos de operaciones continuadas

Resultado atribuido a la sociedad dominante

Intereses minoritarios

66.882

863

2.900

2.953

1.461

1.492

The posting of the aforementioned business combination has been estimated provisionally, meaning that
the Group has a period of one year from the control date to adjust them in line with subsequent more
relevant and complete information. There been no significant adjustments to business combinations
carried the previous year in either 2023 or 2022.

The following business combinations were carried out in 2022:

• On 2 February 2022, FCC Aqualia, S.A. acquired a 65% stake in Georgia Global Utilities (hereinafter, GGU),
a water and renewable energy utility in Georgia, for 158,968 thousand euros. This acquisition took place
in two phases. During the first phase, FCC Aqualia, S.A. (hereinafter, Aqualia) acquired a 65% stake in
GGU. The second phase was initially subject to compliance with conditions precedent.

The agreement between the partners established that during the period between control being assumed
and the completion of the second phase of the agreement, Aqualia held control over the public water
services business with an 80% interest but had no rights over the assets, nor obligations in relation to
the liabilities, nor any right to the profits generated by the energy business controlled by the minority
shareholder. With this in mind, from the date on which control was assumed, FCC Aqualia, S.A. started
to globally consolidate assets and liabilities and allocate 80% of the profit generated corresponding
to the water activity but did not consolidate the energy business. It has reclassified its assets and
liabilities designated as non-current assets and liabilities held for sale, with non-controlling interests as a
balancing entry (note 19). No profit has been recognised on the company's income statement from this
energy business.

Subsequently, the second phase was completed during the second half of 2022 following the spin-off of
the energy business, having satisfied the conditions precedent stated above, including the repayment of
the bonds that the GGU Group issued at the time of the purchase (note 19), in such a way that Aqualia
exclusively holds a 80% interest in the public water services business, having exchanged the 65%
interest in the energy business for the 15% interest in the water business. As a result, the assets held for
sale and the non-controlling interests indicated above were removed from the balance sheet.

Furthermore, there is a put option in favour of the non-controlling interests and a call option in favour of
FCC Aqualia for the 20% stake held by the non-controlling interest in the public water services business,
the fair value of which has been recorded as a financial liability (note 19).

• In November 2022, FCC Construcción, S.A., acquired a stake in Sociedad Concesionaria Tranvía de

Murcia, S.A., which manages the only tram line in the city of Murcia for a period of 40 years, representing
50% of the company's capital stock in addition to the 50% previously held. This interest was acquired for
an amount of 46,662 thousand euros (23,699 thousand euros corresponding to the shares acquired and
22,963 thousand euros corresponding to the loan acquired), which were recognised under "Payments
for investments" on the accompanying Statement of Cash Flows. As a result of the aforementioned
transaction, the FCC Group gained control of the aforementioned company, recording a positive
operating profit of €5,544 thousand in the business combination (note 26), as the consideration paid
was less than the fair value of the assets acquired. In addition, a negative result of €2,772 thousand was
recorded under "Profit/(loss) of entities valued using the equity method" as a result of the fair value of
the stake held by the aforementioned company prior to the takeover (note 26).

• In December 2022, FCC Environmental Services, Llc. acquired a 100% stake in Houston Waste Solutions,

Llc. in the USA, one of the largest commercial municipal solid waste collection companies in the
Houston metropolitan area, for the sum of 27,658 thousand euros. The amount paid was recorded in the
accompanying cash flow statement under "Payments for investments".

290

• In October 2022, the Water area acquired a 79.8% stake in Aguas de la Sabana, S.A. E.S.P., in Colombia,
which provides aqueduct, sewerage and cleaning services in the municipalities of Cota, Funza and
Tenjo, for the sum of 14,421 thousand euros. The amount paid was recorded in the accompanying cash
flow statement under "Payments for investments".

The composition of the balance sheets drawn up by the business combinations in 2022 is detailed below:

2022

Non-current assets

Intangible assets

Property, plant and equipment

Investment property

Investments accounted for using the equity
method

Non-current financial assets

Deferred tax assets

Current assets

Non-current assets held for sale

Inventory

Trade and other receivables

Other current financial assets

Other current assets

Cash and cash equivalents

Georgia
Global Utilities
Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

341,521

1,180

338,231

2,110

–

156,208

133,352

1,654

6,625

–

14,577

210,222

72,804

–

135,330

2,088

27,634

23,671

26,232

3,963

26,200

–

14,034

1,701

1,577

–

1,340

6,014

–

6,680

–

1,594

–

453

1,011

Total assets

497,729

224,256

29,335

27,809

As a result of the aforementioned business combinations, the fair value of the assets acquired was
determined. The following table shows the amounts allocated to assets and liabilities to reflect their fair
value on the takeover date:

Consolidated Group | Notes to the consolidated financial statements | Page 14 of 139

2022

Equity

Georgia
Global Utilities
Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

210,271

98,868

27,658

14,421

Non-current liabilities

186,683

117,533

Grants

Non-current provisions

–

Non-current financial liabilities

177,374

Deferred tax liabilities

Other non-current liabilities

Current liabilities

Liabilities linked to non-current assets
held for sale

Current provisions

Current financial liabilities

Trade and other payables

9,309

100,775

87,496

–

13,260

–

11,770

105,763

–

5,410

2022

–

5,410

–

Intangible assets

Property, plant and equipment

Non-current financial assets

Total assignments to assets

7,855

1,677

7,978

Non-current liabilities (deferred tax liabilities)

Total assignments to liabilities

–

165,312

–

165,312

–

Total net assignments

165,312

–

1,962

5,893

–

1,677

–

2,900

5,078

Total equity and liabilities

497,729

224,256

29,335

27,809

Georgia
Global Utilities
Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

13,526

–

13,526

4,734

8,792

–

The reconciliation between the consideration transferred for each of the above business combinations,
the value of non-controlling interests recognised and the fair value of the net assets acquired are provided
below:

2022

Acquisition value

Fair value Minority interests acquired

Fair value previous interest

- Fair value of net assets

Valuation put non-controlling interests

Georgia
Global Utilities
Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

158,968

45,603

(210,271)

5,700

46,662

27,658

14,421

–

46,662

(98,868)

–

(3,987)

(14,421)

Goodwill/Negative consolidation difference

–

(5,544)

23,671

–

Consolidated Group | Notes to the consolidated financial statements | Page 15 of 139

292

The above business combinations contributed the following revenues and results to the accompanying
consolidated income statement:

In 2022, in addition to the companies indicated above, the following companies were acquired:

2022

Revenue

Other income

Operating profit/(loss)

Profit/(loss) before tax from continuing
operations

Profit attributable to the parent company

Non-controlling interests

Georgia
Global Utilities
Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

65,292

182

23,620

31,569

12,880

18,689

2,065

2,444

–

1,394

600

450

–

426

–

941

–

625

573

120

176

If the above companies had been consolidated since 1 January 2022, the ordinary income and profit/(loss)
they would have contributed would be as follows:

2022

Revenue

Other income

Operating profit/(loss)

Georgia
Global
Utilities Group

Sociedad
Concesionaria
Tranvía de
Murcia, S.A.

Houston
Waste
Solutions,
LLC

Aguas de
la Sabana,
S.A. E.S.P.

70,472

203

25,264

21,570

14,845

6,014

–

11,965

2,635

3,373

Profit/(loss) before tax from continuing
operations

34,182

6,051

2,582

2,980

Profit attributable to the parent company

13,946

4,538

2,582

820

Non-controlling interests

19,713

–

1,194

Name

Acquisition
date

Acquisition
price

Percentage
participation

Fair value
net assets

Goodwill

Intermonte Investments, S.A.

December

Aqualia Colombia, S.A.S.

October

Houston Waste Services, LLC

December

Industria de Reciclaje de
RAEES, S.L.

December

8,920

8,098

3,750

3,695

99,5%

51%

100%

98,5%

8,920

8,098

(328)

3,695

–

4,078

–

b) Other changes in scope

In October 2023, the sale of a 24.99% holding in the Environmental Services subsidiary, FCC Servicios
Medio Ambiente Holding, S.A., the parent company of the Environmental Services activity, was completed
to the Canadian pension fund, CPP Investments, for the sum of 965,000 thousand euros. This transaction
was recorded under “(Acquisition)/disposal of own shares” in the accompanying Statement of Cash
Flows. As control has not been lost, the operation has been recorded as an equity operation and has led
to the increase of 241,310 thousand euros in non-controlling interests and 693,864 thousand euros in
consolidation reserves, as a result of the difference between the price of sale and the value of the non-
controlling interests registered. Additionally, the valuation adjustments have increased by 18.723 thousand
euros, as the proportional part has been attributed to non-controlling interests of the aforementioned
adjustments prior to the sale (Note 17).

This agreement includes a contingent price clause in relation to the cash flows generated by specific
assets included within the scope of the sale. Given that the value of collections or payments cannot be
determined with sufficient reliability and given the uncertainty of the time at which they may occur, the
Group has not recognised any assets or liabilities. In addition, it is estimated that the net value of these
collections or payments will not be relevant (note 25).

293

In December 2023, FCyC, S.A., acquired an additional 12.19% holding in Realia Business, S.A. from
Soinmob Inmobiliaria Española, S.A.U., for the sum of 105,000 thousand euros, recognised in the
accompanying Statement of Cash Flows under “(Acquisition)/disposal of own shares”. With this
acquisition, the FCyC, S.A.'s direct and indirect shareholding in the aforementioned company amounts to
67.05%. Given that, before the purchase, the Group already held control over the company, the difference
between the purchase price and the book value of the acquired non-controlling interests generated an
increase in the consolidation reserves of 33,412 thousand euros, a decrease of in non-controlling interests
of 139,047 thousand euros and an increase in valuation adjustments of 635 thousand euros (note 17).

In December 2023, following the acquisition of an additional 3.99% stake for the sum of 49,571 thousand
euros from Control Empresarial de Capitales, S.A. de C.V., and 1.95% for the sum of 24,233 thousand euros
from Soinmob Inmobiliaria Española, S.A.U., registered in the accompanying Statement of Cash Flows
under “Investment payments”, bringing the total shareholding to 21.21%, Metrovacesa, S.A., which to date
was accounted for at fair value charged to reserves, is now consolidated under the equity method having
achieved significant influence, as at year-end, the Group is now represented on the company's governing
bodies. This transaction resulted in the recognition of profit of 142,413 thousand euros under “Profit/(loss)
of entities valued using the equity method” given the difference between the fair value of their net assets
and the quoted price of the investment before its inclusion in the scope of consolidation (notes 11, 13, 17
and 30).

In December 2023, FCC Medio Ambiente agreed to buy out the Urbaser Group's subsidiary in the United
Kingdom. The estimated enterprise value of the transaction (including debt and equity) amounts to £398
million (approximately 458 million euros). The transaction is expected to be completed in the second
quarter of 2024, subject to the satisfaction of certain conditions, customary in this type of transaction.

5. Distribution of profit/loss

Fomento de Construcciones y Contratas, S.A. distributed a scrip dividend in 2023 and 2022, resulting in
a cash outflow of €19,452 thousand (€10,783 thousand in 2022) and the delivery of 22,697,739 shares
(14,871,347 shares in 2022) (note 17). Additionally, certain subsidiaries with minority partners have
distributed dividends.

The following table shows the dividends paid to its shareholders by the Group companies as of 31
December 2023 and 2022:

Shareholders of Fomento de Construcciones y Contratas, S.A.

Other non-controlling shareholders of other companies

2023

19,452

61,333

80,785

2022

10,783

62,394

73,177

"Other non-controlling shareholders of other companies" mainly includes the payment of dividends to the
non-controlling shareholder of FCC Aqualia, S.A. for the sum of 14,921 thousand euros at 31 December
2023 (14,944 thousand euros at 31 December 2022).

Consolidated Group | Notes to the consolidated financial statements | Page 17 of 139

294

6. Intangible assets

a) Concessions

The breakdown of net intangible assets at 31 December 2023 and 2022 is as follows:

The changes in this heading of the consolidated balance sheet in 2023 and 2022 were as follows:

Cost

Accumulated
amortisation

Impairment

Net Value

Concessions

Accumulated
Amortisation

Impairment

Net Value

Balance at 31.12.21

2,718,925

(1,224,776)

(54,444)

1,439,705

2023

Concessions (Note 10)

3,068,721

(1,478,640)

(46,920)

1,543,161

Goodwill

2,009,959

–

(1,158,849)

Other intangible assets

297,914

(196,193)

(12,517)

851,110

89,204

5,376,594

(1,674,833)

(1,218,286)

2,483,475

Additions or allocations

Derecognitions, disposals
or reductions

Translation differences

Change in scope, transfers
and other changes

41,781

(1,785)

14,967

134,422

(120,022)

1,113

(2,692)

2,476

(524)

3,148

(1)

(78,765)

2,476

12,274

136,954

2022

Balance at 31.12.22

2,908,310

(1,343,901)

(51,765)

1,512,644

Concessions (Note 10)

2,908,310

(1,343,901)

(51,765)

1,512,644

Goodwill

1,912,627

–

(1,150,944)

Other intangible assets

261,399

(181,184)

(12,394)

761,683

67,821

5,082,336

(1,525,085)

(1,215,103)

2,342,148

Additions or allocations

Derecognitions, disposals
or reductions

Translation differences

Change in scope, transfers
and other changes

34,558

(1,908)

45,205

82,556

(130,550)

1,628

(5,917)

100

(1,839)

6,684

(1)

(97,831)

6,404

39,287

82,657

Balance at 31.12.23

3,068,721

(1,478,640)

(46,920)

1,543,161

This heading includes the intangible assets corresponding to the service concession arrangements
(Note 10).

The most significant additions in 2023 correspond, in the Environmental Services segment, to the ongoing
projects undertaken by FCC Medio Ambiente, S.A. for the sum of 7,075 thousand euros (6,445 thousand
euros in 2022), Ecoparque Mancomunidad del Este, S.A. for the sum of 1,818 thousand euros (2,858
thousand euros in 2022) and by FCC CEE Group companies for the sum of 2,155 thousand euros (753
thousand euros in 2022) and, in the Integrated Water Management segment, Acque di Caltanisseta, S.P.A
for the sum of 14,436 thousand euros (10,112 thousand euros in 2022) and FCC Aqualia, S.A. for the sum
of 4,340 thousand euros (10,139 thousand euros in 2022).

295

Consolidated Group | Notes to the consolidated financial statements | Page 18 of 139

"Changes in scope, transfers and other movements" in the service concession agreements include
the recognition of future investment commitments included in the tariff as an increase in the value of
intangible assets with a balancing entry in provisions (note 10) mainly at companies in the Integrated
Water Management segment, with the most noteworthy in 2023 as follows: FCC Aqualia, S.A. for the sum
of 25,276 thousand euros (36,125 thousand euros in 2022), Aqualia Riohacha S.A.S. E.S.P. for the sum of
26,661 thousand euros, Aqualia Gestión Los Cabos SACV for the sum of 16,319 thousand euros.

In addition, in 2022, this heading included the incorporation of intangible assets corresponding to
Concesionaria Tranvía de Murcia, S.A., following its takeover, for the sum of 72,804 thousand euros (note 4).

Cash inflows and outflows are recorded in the accompanying cash flow statement as "Payments for
investments" and "Proceeds from disposals" of "Property, plant and equipment, intangible assets and
investment property" respectively.

No interest was capitalised in 2023 and 2022 and the total interest capitalised at source amounted to
43,915 thousand euros (42,501 thousand euros in 2022).

b) Goodwill

The breakdown of goodwill in the accompanying consolidated balance sheet at 31 December 2023 and
2022 was as follows:

FCC Environment Group (UK)

Cementos Portland Valderrivas, S.A.

FCC Environment Group (CEE)

Municipal District Services, Llc.

FCC Aqualia, S.A.

FCC Ámbito, S.A.

Houston Waste Solutions, Llc.

Premier Waste Services, Llc.

FCC Industrial e Infraestructuras Energéticas, S.L.U.

Canteras de Aláiz, S.A.

Other

2023

301,064

143,098

136,793

85,118

82,764

23,311

22,848

22,154

21,499

4,332

8,129

2022

294,994

143,098

136,793

–

82,764

23,311

23,671

22,951

21,499

4,332

8,270

851,110

761,683

The movements of goodwill in the attached consolidated balance sheet in 2023 and 2022 were as follows:

Balance at 31.12.21

Exchange differences, change in consolidation scope and others:

Houston Waste Solutions, Llc.

Other

Impairment losses:

948,976

12,707

23,670

(10,963)

Cementos Portland Valderrivas Group (note 26)

(200,000)

Balance at 31.12.22

Exchange differences, change in consolidation scope and others:

Municipal District Services, Llc.

Other

Balance at 31.12.23

85,118

4,309

761,683

89,427

851,110

"Changes in the scope of consolidation, translation differences and other movements" in 2023 mainly
includes the acquisition of 97% of Municipal District Services, Llc., in the Integrated Water Management
segment, for the sum of 85,118 thousand euros (note 4) and the impact of the appreciation of the pound
sterling against the euro.

In 2022, the change in this heading related mainly to the acquisition of US company Houston Waste
Services, Llc., within the Environmental Services segment, for the sum of 23,670 thousand euros (note 4)
and the effect of the depreciation of the pound sterling against the euro

In 2022, an impairment to the goodwill of the Cementos Portland Valderrivas Group was recognised for
the sum of 200,000 thousand euros under “Impairment losses” corresponding to Cementos Portland
Valderrivas, S.A. for the sum of 196,288 thousand euros and Cementos Alfa, S.A. for the sum of 3,712
thousand euros, mainly due to the increase in energy prices and the increase in the discount rate.

The impairment analysis policies applied by the Group to its goodwill are described in Note 3.f). In
accordance with the methods used and in accordance with the estimates, projections and valuations
available to the Group's Management, the existence of losses in value is not apparent in 2023.

The estimates made and the sensitivity analysis of the most significant goodwill impairment tests are
discussed below.

Consolidated Group | Notes to the consolidated financial statements | Page 19 of 139

296

It should be noted that in preparing the impairment tests, cash flows have been estimated on the basis
of Group management's best estimates and that upward or downward variations in the key assumptions
considered, both in the discount rate and operating margins, among other factors, may affect the
recoverable amount of the cash-generating unit considered.

Cementos Portland Valderrivas

Composed of two separately identifiable goodwill items recorded in the individual books of Cementos
Portland Valderrivas, S.A.:

• one arising from the merger by absorption of the parent company of the Corporación Uniland Group and

some of its subsidiaries for an amount of €29,593 thousand,

• €113,505 thousand corresponding to the cash generating unit (CGU) comprising the Alcalá de Guadaira

factory.

The main hypotheses used in each of the impairment tests of the two previous CGUs are described below:

1) Corporación Uniland

The shareholding in Uniland was acquired in several stages between 2006 and 2013, until 100% of the
shareholding was acquired for a total amount of 1,898,973 thousand euros.

An impairment of goodwill associated with the above purchases amounting to €239,026 thousand was
recorded in 2011 as a result of the sharp market contraction in the cement sector, which was not expected
to recover in the short to medium term. An additional impairment of €187,191 thousand was recognised
in 2016 and in 2019 the impairment test was updated to take into account the slower growth in cement
consumption, largely as a result of the slowdown in the real estate market, whereby future forecasts
were adjusted to take into account uncertain demand scenarios and an additional impairment of €70,011
thousand was recognised.

Firstly, based on the historical information of the last 50 years in the cement industry, it is considered that
the term that best reflects the life cycle of the cement market is ten years, a period used in the projections
made.

Since Uniland operates in two clearly different geographic markets, various pre-tax discount rates have
been used to assess flows from different countries. A pre-tax discount rate of 11.61% has been used to
evaluate goodwill from flows in Spain, and 28.80% for flows from Tunisia. The discount rates used in 2022
were 10.55% and 28.60% respectively. In any case, it should be noted that the flows for Spain represent a
substantial part of the total contemplated in the impairment test.

The Group bases its cash flow forecasts on historical data and on both internal future forecasts and future
forecasts by external sectoral bodies. In the short term, the forecasts are made according to estimates of
cement consumption of Oficemen, the employer association of the sector and internal estimates. For the
medium and long term, the projections are prepared according to external projections of macroeconomic
data on inflation and GDP (Bank of Spain, Funcas, Statista etc.) and historical trends.

According to information from Oficemen, the employers' association for the cement sector in Spain, in
its advanced statistical data for 2023, 14.5 million tons of cement was consumed in 2023, down by 3%
compared to the final figures for 2022; this volume is expected to be maintained in 2024.

For the Spanish market, the residual value assumed in the flow projections is calculated based on
consumption considered sustainable, which is around 20-25 million tonnes, with no growth in perpetuity.
The main inputs used for the determination of this consumption range are consistent with historical
and expected series of relative weights of public works on GDP in Spain, as well as with the forecasts of
the number of approvals for new housing that have been considered as standardised levels according
to different sector reports. The cyclical nature of the sector is considered in this value, assuming that
this level of long-term sustainable consumption would be the average of one cycle, in which the years of
higher consumption would be offset by those with a lower consumption. The sustainable residual value
considered is the average of the values of the last five years of the projections.

During 2021, the Group reassessed the impairment test, in response to the economic situation and market
circumstances, recognising an impairment of 100,000 thousand euros.

In Tunisia in 2022, the internal market in 2023 stood at 5 million tons, 9% down on 2022. Inflation and
political instability have curtailed consumption in the country to minimum levels.

During 2022, the Group reassessed the impairment test one again, taking into account the current
economic situation and market circumstances, which inevitably impacted the projected cash flows. As a
result of the assessment, an impairment loss of €196,288 thousand was recognised under "Impairment
and gains/(losses) on disposal of fixed assets" in the accompanying consolidated statement of profit and
loss.

During 2023, the Group updated the flows of its “Business Plan” for the 2024-2033 period, which serves as
the basis for calculating impairment tests.

The costs are estimated based on the expected inflation, the performance expectations of the price of
fuels and the electricity market, and the strategy of increasing the valuation of alternative fuels.

The variation in working capital included in the analysis for each of the years remains stable in the way it is
calculated and is linked to the general evolution of the unit analysed.

The trend in investment is also linked to the general development of the activity analysed. The value of the
investments reflected in the perpetuity rate presents the value that the company estimates should be the
target investments to be made in order to maintain the productive activity at the required sustainable level.

297

The main variables used in the test are listed below:

The main variables used in the test are the following:

• Discounted flow period for Uniland Spain and Tunisia: 2024 to 2033

• Discount of flows period: 2024 to 2033

• Discount rate before taxes: 11.61% (Spain) and 28.80% (Tunisia)

• Discount rate before taxes: 12.1%

• Growth in perpetuity: 0%

• Residual value on the recoverable amount of the CGU as a whole: 29.9%

• Residual value on recoverable amount of the CGU: 31.4%

• Compound annual growth rate Cement Market Spain (without CO2), terminal value for business year

• Compound annual growth rate (without CO2), terminal value over business year 2024:

2024:

– Turnover domestic market: 5.6%

– Export market turnover: -9.8%

– Gross Operating Profit: 2.6%

• Compound annual growth rate (in dinars) Tunisia Cement Market, terminal value over business year

2023:

– Turnover domestic market: 6.0%

– Export market turnover: 2.5%

– Gross Operating Profit: 4.0%

– Total turnover: 5.6%

– Gross Operating Profit: 0.4%

The result of the test shows an excess in the recoverable value over the book value of the cash generating
unit of 82,744 thousand euros.

The Cementos Atlántico goodwill test can take a pre-tax discount rate of up to approximately 19%.
Meanwhile, it would support an annual drop in cash flows of approximately 36% compared to projected
flows.

Based on the foregoing, the Group considers that the excess of the impairment test allows deviations
significant enough to not give rise to any value impairments of CGU assets.

The result of the test shows an excess in the recoverable value over the book value of the cash generating
unit of 15,270 thousand euros.

The Uniland goodwill test supports an increase in the pre-discount rate of up to approximately 12.1%.
Meanwhile, it would support an annual drop in cash flows of approximately 3,64% compared to projected
flows.

Based on the foregoing, Management considers that the sensitivity of the impairment test allows
deviations significant enough to not identify the impairment of the value of the assets affected by the CGU.

2) Alcalá de Guadaíra

The cement demand forecasts and the sector expectations, at the national level, described above for the
Corporación Uniland goodwill are equally applicable to Cementos Atlántico.

The Alcalá de Guadaira factory continues to benefit from its geographical location to offset the decrease in
the volume of the national market with a greater volume of exports.

FCC Environment Group (UK)

The FCC Group acquired 100% of the stake in the FCC Environment (UK) Group in 2006 for an investment
cost of 1,693,532 thousand.

From the moment of its acquisition, the Group considers the FCC Environment (UK) subgroup as a single
cash generating unit (CGU), with the goodwill recorded in the balance sheet associated exclusively with
such CGU.

It should be noted that in 2012 there was an impairment of goodwill amounting to 190,229 thousand euros
as a result of the decrease in cash flows of its activities due to changes in its calendar and amount. On the
other hand, in 2013 there was an additional impairment of goodwill amounting to 236,345 thousand euros,
mainly as a result of the decrease in the volume of tons treated in landfills. Finally, in 2014 there was an
impairment of the items of property, plant and equipment affected by landfill activity amounting to 649,681
thousand euros. In 2020, a corporate reorganisation took place in relation to Environment activity in the
United Kingdom, with certain assets transferred to Green Recovery Projects Limited.

298

The cash flows considered in the impairment test take into account the current status of the CGU, making
the best estimates of future flows based on the mix of activities expected in the future. The relative weight
of the different activities will vary as other waste treatment alternatives are promoted, mainly recycling and
recovery, which is currently being carried out by the subgroup, offsetting the progressive abandonment of
landfill activity.

The impairment test has been carried out using conservative and continuous projections based on
historical performance in recent years and based on the foreseeable performance of the businesses.
The main hypotheses used contemplate the historical trend of strengthening waste treatment/recovery
and incineration activities in the face of a gradual decrease in landfill management activity. The income
considered during the period reflects decreasing volumes in landfill activity, partially offset by the
increase in other related activities, while treatment activity shows stable tonnages, the performance
of which depends on inflation, except in 2025 when the Lostock complex is due to come online. The
pre-tax discount rate used was 11.75% with a 10-year time line used from estimates given the structural
characteristics of the business and the long useful life of the assets. A growth rate of 1% has been
considered in the calculation of perpetual income, which represents 29,0% of the total recoverable value.
The result of the test renders an excess of the recoverable value over the book value of the cash generating
unit of 128,397 thousand euros, supporting an increase of more than 1,100 basis points in the discount
rate without incurring impairment. A 10% decrease in the current value of cash flows would reduce the
excess to 103,333 thousand euros. If a zero growth rate had been considered, the aforementioned excess
would have decreased to 122,214 thousand euros.

As indicated in note 3.f) of these financial statements, the general criterion is not to consider growth rates
in perpetual income, but in the case of the FCC Environment (UK) subgroup, given the transformation that
is taking place in the mix of activities, it is considered that a growth rate of 1% more accurately reflects the
reality of the business in the context of the change that is taking place in the United Kingdom in the waste
management activity, with a drastic fall in the disposal of waste in landfills and an increase in alternative
waste management activities that is expected to be sustained over a prolonged period of time.

In addition, given the slack shown in the impairment test and the fact that the main assets and liabilities of
its business are referenced in the same currency (pound sterling), no impairment should be evident.

FCC Environment Group (CEE)

The FCC Group acquired 100% of the stake in the FCC Environment CEE Group in 2006 for an investment
cost of 226,829 thousand. From the moment of its acquisition, the Group considers the FCC Environment
CEE subgroup as a single cash generating unit (CGU), with the goodwill recorded in the balance sheet
associated exclusively with such CGU.

The Group operates in Central and Eastern Europe, with its headquarters located in Himberg (Austria).
The countries in which it operates are: Austria, the Czech Republic, Slovakia, Poland, Romania, Serbia and
Hungary. Its activity consists of the collection, transport and elimination of all types of waste, as well as
auxiliary environmental services.

The cash flows considered in the impairment test take into account the current status of the CGU, making
the best estimates of future flows based on the activities in the future.

The forecasts used suggest higher growth in the first years on account of the expectation of new business
opportunities, before stabilising as these markets are mostly mature with limited growth expectations. The
main hypotheses used suggest higher growth in revenue, of approximately 5.8% to 9.2% in the first three
years on account of the new business opportunities indicated above, before stabilising at around 3% in
the years following the test. In turn, the gross operating margin stands at around 17% for the entire period
under consideration, somewhat beneath this year's margin.

The pre-tax discount rate used was 12.22% and a growth rate of 0% was employed as part of the
calculation of perpetual income, which accounts for 75.8% of the total recoverable value. The result of the
test shows an excess in the recoverable value over the book value of the cash generating unit of 101,875
thousand euros. The test supports an increase in the discount rate of more than 250 basis points. A 10%
decrease in the present value of cash flows would bring this excess down to 56,667 thousand euros.

Given the flexibility shown in the impairment test, the Group does not believe that there will be any
impairment.

299

c) Other intangible fixed and non-current assets

7. Property, plant and equipment

The changes in this heading of the consolidated balance sheet in 2023 and 2022 were as follows:

Other intangible
assets

Accumulated
Amortisation

Impairment

Net value

(305,143)

(16,494)

56,551

Balance at 31.12.21

Additions or allocations

378,188

22,566

Derecognitions, disposals or reductions

(151,399)

Translation differences

Change in scope, transfers and other
changes

939

11,105

(13,569)

148,436

(460)

(10,448)

(1)

563

(25)

3,563

Balance at 31.12.22

Additions or allocations

Derecognitions, disposals or reductions

Translation differences

Change in scope, transfers and other
changes

261,399

(181,184)

(12,394)

40,671

(3,031)

452

(1,577)

(16,956)

1,972

(60)

(83)

–

(40)

–

8,996

(2,400)

454

4,220

67,821

23,632

(1,059)

447

(1,637)

Balance at 31.12.23

297,914

(196,193)

(12,517)

89,204

In 2023, “Additions or allocations” includes the contract for the installation and operation of advertising on
street furniture in the city of Sintra (Portugal) entered into by Cemark - Mobiliario Urbano e Publicidade,
S.A., in the Concessions segment, leading to an increase in this heading of 18,650 thousand euros.

In 2022, "Disposals, derecognitions or reductions" included the derecognition of certain intangible assets
that were recognised as part of business combinations in previous years that have already exhausted their
useful life for the sum of 136,303 thousands of euros.

This heading mainly includes:

• amounts paid to public or private entities as fees for the award of agreements that are not classified

as concessions, within the scope of IFRIC12 "Service Concession Arrangements", mainly in the
Environmental Services Area,

The net detail of property, plant and equipment at 31 December 2023 and 2022 is as follows:

Cost

Accumulated
amortisation

Impairment

Net value

2023

Land and buildings

1,805,048

(658,697)

(97,161)

1,049,190

Land and natural resources

Buildings for own use

Plant and other items of property, plant
and equipment

704,980

1,100,068

(182,877)

(475,820)

(82,760)

(14,401)

439,343

609,847

9,463,229

(6,038,934)

(643,686)

2,780,609

Plant

5,487,940

(3,623,297)

(605,966)

1,258,677

Machinery and vehicles

2,824,099

(1,795,070)

(34,555)

211,003

940,187

–

(620,567)

(3,165)

11,268,277

(6,697,631)

(740,847)

3,829,799

994,474

211,003

316,455

Advances and PP&E under construction

Other PP&E

2022

Land and buildings

1,730,948

(609,299)

(94,093)

1,027,556

Land and natural resources

Buildings for own use

Plant and other items of property,
plant and equipment

691,847

1,039,101

(175,830)

(433,469)

(81,064)

(13,029)

434,953

592,603

8,910,125

(5,810,603)

(630,274)

2,469,248

Plant

5,340,053

(3,491,070)

(592,689)

1,256,294

Machinery and vehicles

2,559,704

(1,738,073)

(33,720)

Advances and PP&E under construction

Other PP&E

148,228

862,140

–

(581,460)

(3,865)

787,911

148,228

276,815

• amounts recognised on initial recognition of certain business combinations representing items such as

10,641,073

(6,419,902)

(724,367)

3,496,804

customer portfolios and agreements in place at the time of purchase,

• quarrying rights in the Cement Area, and software applications.

300

Consolidated Group | Notes to the consolidated financial statements | Page 23 of 139

The movements in the various fixed and non-current assets headings in 2023 and 2022 were as follows:

Land and
natural
resources

Buildings for
own use

Land and
buildings

Plant

Machinery and
vehicles

Advances and
PP&E under
construction

Other PP&E

Plant and
other items of
property, plant
and equipment

Accumulated
amortisation

Impairment

694,516

966,657

1,661,173

4,997,778

2,320,002

10,386

(1,654)

(781)

(10,620)

45,928

(26,926)

12,078

41,364

56,314

(28,580)

11,297

30,744

51,492

(11,996)

(34,076)

336,855

303,287

(104,925)

1,732

39,608

92,561

105,922

(731)

1,195

(50,719)

774,748

8,185,089

(6,225,288)

(758,418)

81,816

(18,902)

2,570

21,908

542,517

(136,554)

(28,579)

347,652

(385,653)

131,974

46,532

12,533

(14,734)

4,448

32,801

11,536

Balance at 31.12.21

Additions or allocations

Derecognitions, disposals or reductions

Translation differences

Change in scope, transfers and other
changes

Balance at 31.12.22

691,847

1,039,101

1,730,948

5,340,053

2,559,704

148,228

862,140

8,910,125

(6,419,902)

(724,367)

Additions or allocations

Derecognitions, disposals or reductions

Translation differences

Change in scope, transfers and other
changes

19,203

(13,726)

815

6,841

81,983

(22,239)

(2,662)

3,885

101,186

(35,965)

(1,847)

10,726

85,786

(8,478)

18,001

52,578

397,729

(154,808)

(3,727)

25,201

151,668

(2,177)

(2,001)

(84,715)

98,898

(17,181)

2,418

(6,088)

734,081

(182,644)

14,691

(13,024)

(448,409)

176,269

(18,001)

12,412

(9,006)

9,045

(12,547)

(3,972)

Balance at 31.12.23

704,980

1,100,068

1,805,048

5,487,940

2,824,099

211,003

940,187

9,463,229

(6,697,631)

(740,847)

Significant "Additions" in 2023 include investments made for the performance of the agreements for the
Environmental Services activity, mainly in different companies that carry out their activity in the United
States for a total of €59,771 thousand (€96,827 thousand in 2022), in FCC Medioambiente, S.A. (Spain)
for a total of 288,013 thousand euros (160,731 thousand euros in 2022), at companies operating in the
UK for a total of 49,825 thousand euros (39,702 thousand euros in 2022), and at FCC Environment CEE
(Central Europe) for a total of 80,078 thousand euros (64,681 thousand euros in 2022). When it comes
to End-to-End Water Management activity, worth particular mention are the investments made mainly
in FCC Aqualia, S.A. (Spain) for the sum of 44,538 thousand euros (26,272 thousand euros in 2022), in
SmVak (Czech Republic) for the sum of 29,682 thousand euros (30,440 thousand euros in 2022) and in
the Georgia Global Utilities Group (Georgia), for the sum of 72,399 thousand euros (36,837 thousand euros
in 2022), for as well as in construction activity, mainly in FCC Construcción, S.A. for the sum of 61,353
thousand euros (39,972 thousand euros in 2022).

"Changes in the scope of consolidation, transfers and other movements" for 2022 included the
incorporation of the tangible assets corresponding to the Georgia Global Utilities Group, following its
takeover, for the sum of 338,231 thousand euros (note 4).

"Derecognitions, disposals or reductions" include disposals and derecognition of inventories corresponding
to assets that, in general, are almost fully amortised due to having exhausted their useful life.

Inflows and outflows that have resulted in cash inflows or outflows are recorded in the accompanying
cash flow statement as "Payments for investments" and "Proceeds from divestments" of "Property, plant
and equipment, intangible assets and investment property", respectively.

No interest was capitalised in 2023 and 2022 and the total interest capitalised at source as at 31
December 2023 amounts to 2,932 thousand euros (6,383 thousand euros in 2022).

301

As at 31 December 2023, in property, plant and equipment, €9,500 thousand (€7,719 thousand as at 31
December 2022) has been charged as income from capital grants.

The Group companies take out the insurance policies they consider necessary to cover the possible risks
to which their property, plant and equipment are subject. At year-end, the Parent estimates that there is no
hedging deficit related to said risks.

The gross amount of fully depreciated property, plant and equipment used in production due to being in a
good state of use totals 3,202,634 thousand euros at 31 December 2023 (2,933,702 thousand euros at 31
December 2022).

The property, plant and equipment net of depreciation on the attached consolidated balance sheet located
outside the Spanish territory amount to 2,068,360 thousand euros at 31 December 2023 (1,984,050
thousand euros at 31 December 2022).

The restrictions on ownership of these assets arise from the lease agreements explained in note 9 of
these notes to the consolidated financial statements, and also from assets assigned to the operation of
certain agreements with characteristics similar to those of concession arrangements, but to which IFRIC
12 "Concession arrangements" (note 3.a) does not apply.

Purchase commitments

As part of the performance of their activities, Group companies have formalised commitments to acquire
property, plant and equipment, mainly machinery and vehicles following the renewal Environmental
Services activity contracts, which as at 31 December 2023 amounted to 90,400 thousand euros (173,305
thousand euros at 31 December 2022).

Restrictions on title to assets

Of the total property, plant and equipment on the consolidated balance sheet, at 31 December 2023,
775,301 thousand euros (734,000 thousand euros at 31 December 2022) are subject to ownership
restrictions according to the following detail:

Land and natural resources

Buildings for own use

Plant

Machinery and vehicles

Cost

Accumulated
amortisation

Impairment

Net value

Other PP&E

In-progress property, plant and equipment and advances

2023

2022

–

2,897

70,706

–

16,797

90,400

–

138,338

610

34,357

173,305

2023

Buildings, plants and equipment

1,503,241

Other property, plant and
equipment

172,468

(785,880)

(110,254)

(4,274)

–

713,087

62,214

1,675,709

(896,134)

(4,274)

775,301

2022

Buildings, plants and equipment

1,396,897

Other property, plant and
equipment

162,538

(717,304)

(103,598)

(4,533)

–

675,060

58,940

1,559,435

(820,902)

(4,533)

734,000

Consolidated Group | Notes to the consolidated financial statements | Page 25 of 139

302

8. Investment property

As stated in note 3.e), investment property is measured at fair value based on the assessments made by
independent experts, calculated on the reporting date of these consolidated financial statements.

In the case of the assessments corresponding to the Realia Business Group, the methodology for
determining the fair value of the investment property is based on the RICS principles, which basically
use discounted cash flows as the valuation method, which consists of capitalising the net rents of each
property and discounting the future flows, applying market discount rates, over a ten-year time horizon
and a residual value calculated by capitalising the estimated rent at the end of the projected period at
an estimated yield. The properties were assessed on an individual basis, taking into account each of
the agreements in force at year-end and their duration. For buildings with vacant areas, these have been
assessed on the basis of estimated future rents, discounting a marketing period.

The key variables in this method are the determination of the net income, the duration of the lease
agreements, the time period over which the leases are discounted, the approximation of value at the end of
each period and the target internal rate of return used to discount the cash flows.

The key variables used in the assessments using the discounted cash flow method are:

• Current gross income: contractual income of the agreements outstanding at the date of the

assessment, without taking into account bonuses, grace periods and expenses not passed on.

• Current net income: the revenue generated by each property at the date of the assessment, net of

allowances and deficiencies and taking into account the non-chargeable expenses in accordance with
the agreements and for vacant spaces.

• Estimated revenue for vacant space and/or new leases over the years of the cash flow.

• Exit Yield: required rate of return at the end of the assessment period on the sale of the asset. At the end
of the discount period it is necessary to determine an exit value of the property. At that point it is not
possible to reapply a discounted cash flow methodology and it is necessary to calculate the sale value
according to an exit yield based on the rent being generated by the property at the time of sale, provided
that the cash flow projection assumes a stabilised rent that can be capitalised in perpetuity.

In the case of the investment property of Jezzine Uno, S.L.U., given the characteristics of the agreement,
which includes a period of assured rental income until 2037, when the lessee has the option to repurchase
at fair value, the assessment method used was the discounted cash flow method. Discounted cash flow
("DFC") is a method generally accepted by valuation experts from both a theoretical and practical point of
view as the method that best incorporates all factors affecting the value of a business into the valuation
result, considering the company as a real investment project.

This methodology considers the results of the operating activity and also the investment and working
capital policy to calculate the future cash flow generation capabilities of the assets linked to the business,
which are discounted to the assessment date to obtain the present value of the business.

The sum of the following two components has been considered for the determination of the fair value:

• Estimated cash flows over the life of the agreement until its completion in 2037: The calculation is
based on the amount of rents expected to be obtained, including the expenses chargeable to the
lessee under the agreement (property tax, community charges and other fees), less the operating costs
incurred for the management of the properties and the corresponding operating taxes. The cash flows
obtained are discounted in line with expected inflation.

• Divestment value: An exit value of the property has been estimated at the end of the lease term. At that
point it is not possible to re-apply a discounted cash flow methodology and it is necessary to calculate
the sale value according to an exit yield based on the expected market rent that the properties could be
generating at the time of sale and which can be capitalised in perpetuity. The market rent in 2037 has
been determined on the basis of an analysis of the possible market rent of the premises, assuming that
the market rent will vary annually until 2037 in line with expected annual inflation rates in the future. For
the purpose of determining the net capitalisable income in perpetuity, the total amount of asset-related
expenses expected in 2037 (no longer chargeable in the context of a market sale) has been deducted.
It has also been assumed that minor investments will be necessary to adapt the assets for their sale on
the market, estimating the marketing costs that would be incurred in their sale. The corresponding tax
effect has been deducted from the amount of capital gain thus obtained.

The key variables used in the above assessment are as follows:

• Amount of net rents during the lease agreement calculated as explained above.

• IRR: interest rate or rate of return offered by an investment, the value of the discount rate that makes the

• Discount rate: A discount rate determined on the valuation date has been used based on the interest

NPV equal to zero, for a given investment project.

• ERV: Market return on the asset at the assessment date.

rate of long-term bonds plus a risk premium that reflects the additional increase in profitability required
based on the risk inherent to its real estate portfolio, taking into account elements such as the type of
business, liquidity, characteristics of the assets, investment volume, etc.

• Exit yield: Required rate of return at the end of the lease agreement on the sale of the assets.

303

The fair value of investment property amounted to 2,091,328 thousand euros at 31 December 2023
(2,122,854 thousand euros at 31 December 2022).

In the case of Jezzine Uno, S.L.U.'s investment property, a sensitivity analysis of the main variables
affecting its assessment is provided below.

The following is a sensitivity analysis of the main variables affecting the assessment at fair value of the
Realia Business Group's investment property.

The impact of a quarter of a percent change in the discount rate used to determine the present value of
both the contract rents and their divestment value would be as follows:

The effect of the change in the required rates of return (Exit yield), calculated as income on the market
value of the assets, in terms of "Net Asset Value", on the consolidated assets and the consolidated profit
and loss account, in respect of the investment property in operation, would be as follows:

2023

2022

Consolidated
profit/(loss) for
the year

(33,596)

37,931

Assets

(46,385)

51,095

Consolidated
profit/(loss)
for the year

(34,789)

38,321

Assets

(44,794)

50,574

Increase of 25 basis points

Decrease of 25 basis points

In addition, the sensitivity analysis of a 10% change in the ERV (market rent of the asset at the assessment
date) would be as follows:

2023

2022

Consolidated
profit/(loss) for
the year

86,575

(86,666)

Assets

110,725

(112,175)

Consolidated
profit/(loss) for
the year

83,044

(84,131)

Assets

115,433

(115,554)

10% increase

10% decrease

Finally, the sensitivity analysis of a quarter point change in the IRR would be as follows:

2023

2022

Consolidated
profit/(loss)
for the year

(20,018)

20,783

Consolidated
profit/(loss) for
the year

(21,728)

20,048

Assets

(28,970)

26,730

Assets

(26,690)

27,710

10% increase

10% decrease

Increase of 25 basis points

Decrease of 25 basis points

2023

2022

Consolidated
profit/(loss)
for the year

(8,474)

8,714

Assets

(12,490)

12,866

Consolidated
profit/(loss)
for the year

(9,368)

9,650

Assets

(11,298)

11,619

Increase of 25 basis points

Decrease of 25 basis points

The impact of a change in the exit yield would be as follows:

2023

2022

Consolidated
profit/(loss)
for the year

(3,501)

3,726

Consolidated
profit/(loss) for
the year

(3,394)

3,613

Assets

(4,525)

4,817

Assets

(4,667)

4,969

Increase of 25 basis points

Decrease of 25 basis points

Finally, the sensitivity analysis of a 10% change in the ERV (market rent of the asset at the assessment
date) would be as follows:

2023

2022

Consolidated
profit/(loss)
for the year

(12,390)

12,390

Consolidated
profit/(loss) for
the year

12,080

(12,080)

Assets

16,107

(16,107)

Assets

(16,520)

16,520

304

Consolidated Group | Notes to the consolidated financial statements | Page 27 of 139

The movements in the various investment property items in 2023 and 2022 were as follows:

9. Leases

Balance 31.12.21

Additions

Derecognitions, disposals or reductions

Change in fair value

Translation differences

Change in scope, transfers and other changes

Balance 31.12.22

Additions

Derecognitions, disposals or reductions

Change in fair value

Translation differences

Change in scope, transfers and other changes

Balance 31.12.23

2,069,187

21,599

(88)

22,179

481

9,496

2,122,854

17,778

(24)

(49,037)

(120)

(123)

2,091,328

The 49,037-thousand euro decrease in the fair value in 2023 can mainly be attributed in the increase in
the “exit yield” and, in some cases, due to changes in the market situation in specific geographical areas in
which there has been increase in availability rates and decrease in rents, as well as other factors.

Significant "Additions" in 2023 included the capitalisation of constructions in progress for rental housing by
the Realia Business, S.A. Group for the sum of 9.383 thousand euros (18,570 thousand euros in 2022).

Both in 2023 and 2022, there were commitments to acquire investment property.

a) Leases where the Group acts as lessee

As a lessee, the Group has entered into agreements to lease underlying assets of various kinds, mainly
machinery in the Construction business and technical installations and buildings for its own use in all the
Group's activities.

Among the agreements entered into in previous years, those for the Group's Central Services buildings
stand out, on the one hand, the agreement for the lease of the office building located in Las Tablas
(Madrid), effective from 23 November 2012 and for 18 years, extendable at the option of the FCC Group in
two periods of five years each, with a rent that can be updated annually in accordance with the CPI.

Additionally, the agreement signed in 2011 for the buildings located at Federico Salmón 13, Madrid and
Balmes 36, Barcelona, for a minimum committed rental period of 30 years, extendable at the Group's
option in two periods of 5 years each with a rent that can be updated annually according to the CPI.
These buildings were transferred to their current owners by means of a sale and leaseback agreement.
The owners, in turn, have granted a purchase option to Fomento de Construcciones y Contratas, S.A.,
exercisable only at the end of the rental period, for the fair value or the amount of the sale discounted by
the CPI, whichever is higher.

In general, the leases entered into by the Group do not include variable payments, only certain agreements
include clauses for the discounting of rent, mainly in line with inflation. In some cases, these agreements
contain restrictions on use, the most common restrictions being those limiting the use of the underlying
assets to geographical areas or to use as office or production premises. The agreements do not include
significant residual value guarantee clauses.

The Group determines the duration of the agreements by estimating the length of time the entity expects
to continue to use the underlying asset based on its particular circumstances, including extensions that
are reasonably expected to be exercised.

The carrying amount of the right-of-use assets amounts to €417,081 thousand at 31 December 2023
(€401,459 thousand at 31 December 2022). The carrying amount, additions and write-downs during the
business years 2023 and 2022 are detailed below by underlying asset class:

Cost

Accumulated
amortisation

Impairment

Net value

Additions

Amortisation
charge

2023

Land and buildings

470,840

(143,724)

(3,925)

323,192

63,027

(41,541)

Land and natural
resources

42,089

(10,620)

(3,925)

27,545

3,639

(4,088)

Buildings for own use

428,751

(133,104)

–

295,647

59,388

(37,453)

Plant and other items
of property, plant and
equipment

178,374

(84,135)

(350)

93,889

42,563

(34,811)

Plant

18,759

(3,905)

Machinery and vehicles

132,528

(65,258)

27,087

(14,972)

–

(350)

–

14,854

66,920

12,115

15,496

(2,508)

25,529

(28,415)

1,538

(3,888)

Other PP&E

649,214

(227,859)

(4,275)

417,081

105,590

(76,352)

305

Lease liabilities recognised amount to €434,850 thousand at 31 December 2023 (€425,395 thousand
at 31 December 2022), of which €76,478 thousand (€78,970 thousand at 31 December 2022) are
classified as current in the accompanying consolidated balance sheet, as they mature within the next
twelve months (note 19). Lease liabilities have generated an interest charge of €13,303 thousand at 31
December 2023 (€12,315 thousand at 31 December 2022). Lease payments made during the year amount
to €93,799 thousand at 31 December 2023 (31 December 2022: €80,525 thousand) and are recognised
under "Receivables and (payments) on financial liability instruments" and "Interest payments" in the
accompanying consolidated cash flow statement. Details of non-current lease liabilities by maturity at 31
December 2023 are shown below:

Liabilities for non-current
leases

2025

2026

2027

2028

2029 and
beyond

Total

44,753

29,410

31,785

31,692

220,733

358,373

Certain agreements are excluded from the application of IFRS 16, mainly because they are low value
assets or because their term is less than twelve months (note 3.g), and are recognised as an expense
under "Other operating income" in the accompanying consolidated income statement, the amount of
which is as follows for 2023 and 2022:

2023

10,100

46,797

56,897

2022

3,571

42,308

45,879

2022

Low value assets

Land and buildings

430,800

(116,645)

(4,533)

309,621

36,387

(38,377)

Leases with term less than 12 months

Land and natural
resources

43,658

(11,501)

(4,533)

27,623

4,142

(3,683)

Buildings for own use

387,142

(105,144)

Plant and other items
of property, plant and
equipment

168,370

(76,532)

Plant

3,340

(1,386)

Machinery and vehicles

135,888

(62,396)

Other PP&E

29,142

(12,750)

–

281,998

32,245

(34,694)

91,838

36,656

(28,529)

1,954

73,492

16,392

(979)

28,081

(22,477)

8,560

(5,073)

599,170

(193,177)

(4,533)

401,459

73,043

(66,906)

Consolidated Group | Notes to the consolidated financial statements | Page 29 of 139

306

b) Leases in which the Group acts as lessor

10. Service concession arrangements

This Note presents an overview of all the Group’s investments in concession businesses, which are
recognised in various headings under “Assets” in the accompanying consolidated balance sheet.

The following table presents the total amount of the assets held under service concession arrangements by
the Group companies, which are recognised under “Intangible assets”, “Non-current financial assets”, “Other
current financial assets” and “Investments accounted for using the equity method” (for both joint ventures
and associates) in the accompanying consolidated balance sheet at 31 December 2023 and 2022.

All lease agreements in which the Group acts as lessor are classified as operating leases, as substantially
all the risks and rewards of ownership of the asset are not transferred.

In its position as lessor, the Group recognises operating income, mainly in the Real Estate business,
amounting to €142,328 thousand (€133,713 thousand at 31 December 2022), as follows:

Revenue from leases

Revenue from common pass-through expenses

2023

120,803

21,525

142,328

2022

111,461

22,252

133,713

Leased assets are mainly recorded under investment property in the accompanying consolidated balance
sheet. The typology of investment property is as follows:

2023

Offices and commercial premises

Banking entities

Plots and other investment property

2023

2022

1,501,937

1,509,154

586,241

3,150

611,140

2,560

2,091,328

2,122,854

In addition, the Group leases tangible fixed assets, mainly machinery in the construction business, the
carrying amount of which is not material.

At 31 December 2023, the Group has contracted minimum lease payments of 924,750 thousand euros
(875,278 thousand euros at 31 December 2022) with tenants in the Realia Group and Jezzine Uno, S.L.U.,
in accordance with the current agreements in force, without considering the repercussion of common
expenses, future CPI increases or future updates of contractually agreed rents, with the following
maturities:

Less than a year

Between two and five years

After five years

2023

111,665

323,028

490,057

924,750

2022

109,289

289,737

476,252

875,278

Water services

Environment

Transport infrastructure
and other

TOTAL

Depreciation

Impairment

2022

Water services

Environment

Transport infrastructure
and other

TOTAL

Accumulated

Impairment

Intangible
assets
(Note 6)

Financial
assets (Note
13)

Joint
concessionary
businesses

Associated
concessionary
companies

Total
investment

1,997,281

558,823

512,617

247,303

211,652

149,610

17,343

6,833

10,434

38,026

10,457

38,840

2,299,953

787,765

711,501

3,068,721

608,565

34,610

87,323

3,799,219

(1,478,640)

(46,920)

–

(1,478,640)

(46,920)

1,543,161

608,565

34,610

87,323

2,273,659

1,877,496

545,060

485,754

245,074

218,117

142,145

19,927

10,150

10,925

41,375

11,507

37,311

2,183,872

784,834

676,135

2,908,310

605,336

41,002

90,193

3,644,841

(1,343,901)

(51,765)

–

(1,343,901)

(51,765)

1,512,644

605,336

41,002

90,193

2,249,175

Consolidated Group | Notes to the consolidated financial statements | Page 30 of 139

The main variation between both years under “Water Services” can mainly be attributed to the new
company Aqualia Riohacha, S.A.S. E.S.P. and Aqualia France, which contribute the sums of 26,280 and
20,055 thousand euros, respectively, to intangible fixed and non-current assets.

Below is a breakdown of the main concessions included in the above categories, detailing their main
characteristics:

Net book value as at
31 December 2023

Water services

Contracts in Colombia

Caltanissetta (Italy)

Jerez de la Frontera (Cádiz - Spain)

Jeddah desalination plant (Saudi Arabia)

Acueducto Realito (Mexico)

Lleida (Lleida, Spain)

Santander (Cantabria, Spain)

Llucmajor (Balearic Islands, Spain)

Badajoz (Badajoz, Spain)

Contracts in Île de France (France)

Oviedo (Asturias, Spain)

Adeje (Tenerife, Spain)

Vigo (Pontevedra, Spain)

Desaladora de Mostaganem (Argelia)

Guaymas Desalination Plant (Mexico)

Other contracts

Transport infrastructure and other

Coatzacoalcos submerged tunnel (Mexico)

Conquense motorway (Spain)

Sociedad Concesionaria Tranvia de Murcia (Spain)

Intangible
assets

827,682

103,013

64,453

60,623

33,937

29,647

28,681

25,120

23,105

22,052

20,055

18,539

14,626

14,251

–

369,579

339,543

236,485

33,240

69,818

Financial
assets

247,303

–

142,575

31,762

7,200

149,609

–

307

Granting entity

Collection mechanism

Miscellaneous municipalities

Consorzio Ambito Territoriale Ottimale

City Council of Jerez de la Frontera.

General Authority of Civil Aviation (Saudi Arabia)

65,766

State Water Commission

Lleida City Council

Santander City Council

Llucmajor town council

Badajoz City Council

User based on consumption

Mixed model

User based on consumption

Miscellaneous municipalities in the Île de France region

User based on consumption

Oviedo City Council

Adeje City Council

Vigo City Council

Algerian Energie Company S.p.a.

State Water Commission

User based on consumption

Cubic meters with guaranteed minimum

Government of the State of Veracruz

Ministry for Economic Development

Direct toll paid by the user

Shadow toll

149,609

Murcia city council

Fixed amount plus the amount paid by the user

Consolidated Group | Notes to the consolidated financial statements | Page 31 of 139

308

Environment

Buckinghamshire plant (United Kingdom)

Loeches Plant (Alcalá de Henares, Spain)

Campello plant (Alicante, Spain)

Granada plant (Granada, Spain)

Edinburgh plant (United Kingdom)

Houston recycling plant (United States)

Gipuzkoa II plant

RE3 plant (United Kingdom)

Manises plant (Valencia, Spain)

Wrexham I plant (United Kingdom)

Wrexham II plant (United Kingdom)

Other contracts

FCC Group Total

Net book value as at
31 December 2023

Intangible
assets

375,937

126,764

105,662

45,072

28,047

20,118

17,165

–

33,109

Financial
assets

211,652

8,960

–

Granting entity

Collection mechanism

Buckinghamshire County Council

Commonwealth of the East

Variable per ton with guaranteed minimum

According to tons treated

Plan Zonal XV Consortium of the Community of Valencia

According to tons treated

Provincial Council of Granada

According to tons treated

86,838

City of Edinburgh and Midlothian Council

Variable per ton with guaranteed minimum

–

27,506

26,403

17,262

16,388

14,692

13,604

City of Houston

Gipuzkoa Waste Consortium

According to tons treated

Variable per ton with guaranteed minimum

Councils of Reading, Bracknell Forest and Workingham

Fixed amount plus variable amount per ton

Metropolitan entity for waste treatment

Fixed amount plus variable amount per ton

Wrexham County Borough Council

Fixed amount plus variable amount per ton

1,543,161

608,565

Consolidated Group | Notes to the consolidated financial statements | Page 32 of 139

309

Net book value as
at 31 December 2022

Intangible
assets

Financial
assets

795,423

245,074

Granting entity

Collection mechanism

Water services

Jerez de la Frontera (Cádiz, Spain)

Caltanissetta (Italy)

Jeddah desalination plant (Saudi Arabia)

Lleida (Spain)

Santander (Cantabria, Spain)

Acueducto Realito (Mexico)

Llucmajor (Balearic Islands, Spain)

Badajoz (Badajoz, Spain)

Vigo (Pontevedra, Spain)

Adeje (Tenerife, Spain)

Oviedo (Asturias, Spain)

Mostaganem Desalination Plant (Algeria)

Guaymas Desalination Plant, Mexico

Other contracts

Transport infrastructure and other

Coatzacoalcos submerged tunnel (Mexico)

Conquense motorway (Spain)

Sociedad Concesionaria Tranvia de Murcia (Spain)

64,317

53,932

40,422

30,730

28,585

26,677

24,348

23,115

21,377

21,099

19,389

–

441,432

329,905

218,842

38,489

72,574

–

City Council of Jerez de la Frontera.

Consorzio Ambito Territoriale Ottimale

General Authority of Civil Aviation (Saudi Arabia)

Lleida City Council

Santander City Council

61,466

State Water Commission

Llucmajor town council

Badajoz City Council

Vigo City Council

Adeje City Council

Oviedo City Council

Algerian Energie Company S.p.a.

State Water Commission

–

147,755

28,827

7,026

142,144

–

User based on consumption

Mixed model

User based on consumption

Cubic meters with guaranteed minimum

Government of the State of Veracruz

Ministry for Economic Development

Direct toll paid by the user

Shadow toll

142,144

Murcia city council

Fixed amount plus the amount paid by the user

Consolidated Group | Notes to the consolidated financial statements | Page 33 of 139

310

Environment

Buckinghamshire plant (United Kingdom)

Loeches Plant (Alcalá de Henares, Spain)

Campello Plant (Alicante, Spain)

Granada plant (Granada, Spain)

Edinburgh Plant (United Kingdom)

Houston recycling plant (United States)

Gipuzkoa II plant

RE3 plant (United Kingdom)

Manises Plant (Valencia, Spain)

Wrexham I plant (United Kingdom)

Wrexham II plant (United Kingdom)

Other contracts

FCC Group Total

Net book value as
at 31 December 2022

Intangible
assets

387,316

126,763

109,651

49,280

29,174

20,681

19,592

–

32,175

Financial
assets

218,118

8,851

–

Granting entity

Collection mechanism

Buckinghamshire County Council

Commonwealth of the East

Variable per ton with guaranteed minimum

According to tons treated

Plan Zonal XV Consortium of the Community of Valencia

According to tons treated

Provincial council of Granada

According to tons treated

87,567

City of Edinburgh and Midlothian Council

Variable per ton with guaranteed minimum

–

28,631

27,620

18,717

17,457

15,267

14,008

City of Houston

Gipuzkoa Waste Consortium

According to tons treated

Variable per ton with guaranteed minimum

Councils of Reading, Bracknell Forest and Workingham

Fixed amount plus variable amount per ton

Metropolitan Entity for Waste Treatment

Fixed amount plus variable amount per ton

Wrexham County Borough Council

Fixed amount plus variable amount per ton

1,512,644

605,336

The water services activity is characterised by a very high number of agreements, the most significant of
which are detailed in the table above. The main activity of the agreements is the end-to-end water cycle,
from the collection, transport, treatment and distribution to urban centres through the use of distribution
networks and complex water treatment facilities for drinking water purification, to the collection and
treatment of wastewater. It includes both construction and maintenance of water and sewerage networks,
desalination plants, water treatment plants and wastewater treatment plants. Billing is generally based
on subscribers' use of the service, so in most cases cash flows depend on water consumption, which is
generally constant over time. However, the agreements usually incorporate periodic tariff review clauses
to ensure the recoverability of the investment made by the concessionaire, in which future tariffs are set
on the basis of consumption in previous periods and other variables such as inflation. In order to carry
out their activities, the concessionaires build or receive the right to use the distribution and sewerage

networks, as well as the complex installations necessary for drinking water treatment and purification. The
concession periods for this type of concession range from different periods, up to a maximum of 75 years,
and the facilities revert to the concession grantor at the end of the concession period, without receiving
any compensation.

In most of the fully consolidated agreements, the amount of the collections depends on the use made of
the service and is therefore variable, as the concession holder bears the demand risk, which is why they
are recorded as intangible assets. However, in exceptional cases, mainly in the case of desalination plants,
payment is received on the basis of the cubic metres actually desalinated, with the grantor guaranteeing
a minimum insured level irrespective of volume, whereby such guaranteed amounts are classified as
financial assets as they cover the fair value of the construction services.

Consolidated Group | Notes to the consolidated financial statements | Page 34 of 139

The "Environment and Other" activity mainly includes agreements relating to the construction, operation
and maintenance of waste management facilities in Spain, the United Kingdom and the United States. The
agreements incorporate price revision clauses based on various variables, such as inflation, energy costs
or wage costs. For the classification of concessions as intangible or financial assets, the contracts have
been analysed to determine which part of the agreement bears the demand risk. In those agreements in
which billing is determined solely on the basis of the fixed charge and a variable amount depending on
the tonnes treated, given that the latter is residual and the cost of construction services is substantially
covered by the fixed charge, the entire concession has been considered as a financial asset, except in the
case of the Buckinghamshire and Edinburgh plants (both in the UK), in which the intangible component is
significant and are therefore recorded as mixed models.

"Transport infrastructure and Other" activity includes, on the one hand, the toll road and tunnel concessions
is the management, promotion, development and operation of land transport infrastructures, mainly toll
roads and tunnels. It includes both the construction and the subsequent conservation and maintenance of
the aforementioned infrastructures over a long concession period, which can range from 25 to 75 years.
Invoicing is usually based on traffic intensity, both through direct vehicle tolls and shadow tolls, so cash
flows are variable in relation to the aforementioned traffic intensity, and generally show an increasing
trend as the concession period progresses, which is why, as the concessionaire bears the demand risk,
they are recorded as intangible assets. The agreements generally comprise both the construction or
improvement of the infrastructure over which the concessionaire receives a right of use, and the provision
of maintenance services, with the infrastructure reverting at the end of its useful life to the grantor, usually
without compensation. In certain cases, compensation mechanisms exist, such as an extension of the
concession period or an increase in the toll price, so as to ensure a minimum return to the concessionaire.
On the other, it also includes the operation of urban trams and other urban transport systems in which
revenue is generated through the collection of fixed or determinable amounts that may be in the form of a
subsidy or fee and that usually include financial balance clauses to ensure the recovery of the investment
by the concession holder. Alternatively, in some contracts, amounts are received directly from passengers
through ticket collecting or using advertising media.

It should also be noted that the concession companies in which the Group has holdings are obliged, in
accordance with the concession agreements, to acquire or construct, during the concession period, fixed
assets for an amount of 336,510 thousand euros at 31 December 2023 (221,785 thousand euros at 31
December 2022).

Finally, it is worth mentioning that the recoverable value of the main concession assets has been re-
estimated in 2023. As a result of the analysis performed, it has been concluded that no impairment
should be recorded. In addition, a significant portion of the concessional asset portfolio corresponds to
agreements not subject to demand risk, which significantly reduces the risk of impairment.

311

11. Investments accounted for using
the equity method

This heading includes the value of investments in companies accounted for using the equity method, as
well as non-current loans granted to these companies which, as indicated in note 2.b), is applied to both
joint ventures and associates, the breakdown of which is as follows:

Joint ventures

Investment value

Loans

Associates

Investment value

Loans

a) Joint ventures

2023

145,819

48,724

97,095

888,469

670,460

218,009

1,034,288

2022

158,648

55,487

103,161

343,981

165,768

178,213

502,629

The breakdown of this caption by company is shown in Annexe II to these annual accounts, which lists the
joint ventures.

The transactions for 2023 and 2022 by items are as follows:

Consolidated Group | Notes to the consolidated financial statements | Page 35 of 139

312

As Cancelas Siglo XXI, S.L.

FCC Environment Group (UK)

Zabalgarbi, S.A.

Ibisan Sociedad Concesionaria, S.A.

Orasqualia for the Development of the Waste
Treatment Plant S.A.E.

Atlas Gestión Medioambiental, S.A.

Construcciones Olabarri, S.L.

Ecoparc del Besós, S.A.

Aguas de Langreo, S.L.

Empresa Municipal de Aguas de Benalmádena, S.A.

Other

Total joint ventures

Balance at
31.12.2022

Profit for
the year
(Note 26.h)

38,622

19,131

15,988

10,925

10,880

7,547

5,969

8,398

3,451

2,994

34,743

1,755

8,518

711

1,228

1,023

1,719

158

3,242

138

1,679

158,648

20,266

Distributed
Dividends

(1,562)

(10,644)

(3,600)

(1,688)

–

(2,708)

–

(6,106)

–

(19)

(3,700)

(30,027)

Changes in the fair
value of financial
instruments allocated
to reserves

Committee

Conversion
differences and
other movements

Change in credits
granted

Balance at
31.12.2023

–

(31)

–

(31)

–

1,052

–

(2,432)

–

(272)

4,628

3,029

–

(366)

(782)

(4,918)

(6,066)

38,815

18,057

13,099

10,434

9,471

6,558

6,127

5,534

3,232

2,059

32,433

145,819

313

Balance at
31.12.2021

Profit for
the year
(Note 26.h)

Distributed
Dividends

Changes in the fair
value of financial
instruments allocated
to reserves

Committee

Conversion
differences and
other movements

Change in credits
granted

Balance at
31.12.2022

As Cancelas Siglo XXI, S.L.

FCC Environment Group (UK)

Zabalgarbi, S.A.

Ibisan Sociedad Concesionaria, S.A.

Orasqualia for the Development of the Waste
Treatment Plant S.A.E.

Ecoparc del Besós, S.A.

Atlas Gestión Medioambiental, S.A.

Construcciones Olabarri, S.L.

Aguas de Langreo, S.L.

Empresa Municipal de Aguas de Benalmádena, S.A.

Sociedad Concesionaria Tranvía de Murcia, S.A.

Other

Total joint ventures

46,954

10,261

13,834

8,401

14,587

7,389

8,627

5,820

3,841

3,984

46,273

40,020

2,585

11,700

3,593

1,090

1,786

3,164

1,591

149

(53)

123

2,044

3,360

(1,217)

(2,288)

(4,500)

–

(378)

(2,216)

(2,671)

–

(188)

–

(1,493)

209,991

31,132

(14,951)

–

3,061

1,434

–

4,603

–

(542)

–

(5,104)

–

(138)

(26,471)

(5,354)

(37,580)

(9,700)

–

(11)

–

(366)

(787)

(21,846)

(1,837)

(34,547)

38,622

19,131

15,988

10,925

10,880

8,398

7,547

5,969

3,451

2,994

–

34,743

158,648

314

In 2022, the "Conversion differences and other movements" and "Variation in loans granted" columns
include the derecognition of Sociedad Concesionaria Tranvía de Murcia, S.A. following the completion of
the takeover (note 4).

The following are the key financial statement aggregates of the joint ventures in proportion to the
percentage interest held in the joint ventures at 31 December 2023 and 2022.

b) Associates

The breakdown of this caption by company is shown in Annexe III to these annual accounts, which lists the
associated companies.

The transactions for 2023 and 2022 by items are as follows:

Non-current assets

Current assets

Non-current liabilities

Current liabilities

Results

Revenue

Operating profit/(loss)

Profit before tax

Profit attributable to the Parent Company

2023

221,954

169,451

211,300

141,503

278,110

36,818

28,479

20,266

2022

355,530

180,421

316,645

158,715

207,861

51,391

41,841

31,132

The main activities carried out by the joint ventures are the operation of concessions, such as motorways,
concessions related to the end-to-end water cycle, urban sanitation activities, tunnels and passenger
transport and the rental of real estate assets.

In relation to joint ventures with third parties outside the FCC Group, guarantees amounting to €7,032
thousand (€7,564 thousand in 2022) have been provided, mostly to public bodies and private customers
to guarantee the successful completion of the agreements for the Group's various activities. There are no
relevant commitments or other significant contingent liabilities in relation to joint ventures.

In general, the joint ventures consolidated by the Group using the equity method take the legal form of
public or private limited companies and, therefore, as joint ventures, the distribution of funds to their
respective parent companies requires the agreement of the other jointly controlling shareholders.

Balance at
1.12.2022

Profit for the year
(Note 26.h)

Distributed
Dividends

Changes in the fair
value of financial
instruments allocated
to reserves

Metrovacesa, S.A.

FCC Environment Group (UK)

Giant Cement Holding

Future Valleys Project Co. Limited

Metro de Lima Línea 2, S.A.

Suministro de Agua de Querétaro, S.A. de C.V.

World Trade Center Barcelona, S.A. de S.M.E.

Aguas del Puerto Empresa Municipal, S.A.

Tirme Group

Lázaro Echevarría, S.A.

FCC Environment Group (CEE)

Aigües del Segarra Garrigues, S.A.

Hormigones y Áridos del Pirineo Aragonés, S.A.

Gestión Integral de Residuos Sólidos, S.A.

Aigües del Vendrell

Codeur, S.A.

Cafig Constructores, S.A. de C.V.

FCC Group PFI Holdings

Other

Total associates

–

18,202

59,723

37,310

11,728

10,399

11,469

9,714

8,011

7,004

7,036

6,112

5,342

4,862

6,024

3,560

109,872

27,611

343,981

–

(1,635)

(13,782)

1,742

2,888

2,214

1,122

(442)

4,812

(54)

2,266

1,572

281

184

(257)

(139)

(584)

(346)

(5,690)

(5,847)

–

(1,889)

–

(4,709)

–

(1,745)

(864)

(75)

–

(93)

(2,365)

–

(1,266)

1,418

(439)

–

315

Conversion
differences and
other movements

Change in credits
granted

Balance at
31.12.2023

Committee

–

101,810

–

402,120

45,416

(152)

(1,982)

(1,358)

1,269

–

395

–

(129)

224

(182)

(0)

186

(1,827)

308

(32,341)

8,798

–

118,261

(595)

3,203

–

(1,504)

–

(121)

–

(77,185)

(2,263)

39,796

402,120

162,042

106,901

62,248

38,840

13,322

11,521

9,918

9,818

7,828

7,759

7,562

6,317

5,526

4,670

3,965

919

–

27,191

888,469

(13,005)

989

101,810

420,745

316

Balance at
31.12.2021

Profit for the year
(Note 26.h)

Distributed
Dividends

Changes in the fair
value of financial
instruments allocated
to reserves

Committee

Conversion
differences and
other movements

Change in credits
granted

Saldo a
31.12.2022

FCC Group PFI Holdings

Future Valleys Project Co. Limited

Metro de Lima Línea 2, S.A.

Giant Cement Holding

Suministro de Agua de Querétaro, S.A. de C.V.

Aguas del Puerto Empresa Municipal, S.A.

World Trade Center Barcelona, S.A. de S.M.E.

Tirme Group

Lázaro Echevarría, S.A.

Aigües del Segarra Garrigues, S.A.

FCC Environment Group (CEE)

Hormigones y Áridos del Pirineo Aragonés, S.A.

Codeur, S.A.

Gestión Integral de Residuos Sólidos, S.A.

Aigües del Vendrell

Cafig Constructores, S.A. de C.V.

Other

Total associates

121,495

30,973

31,684

18,327

9,325

11,948

9,904

8,156

7,959

7,473

7,148

6,090

6,503

5,331

5,268

4,497

31,770

323,851

(797)

491

3,714

(10,698)

1,410

(330)

496

5,138

559

1,675

137

(194)

(203)

298

(723)

991

–

(5)

–

(3,573)

–

(864)

(1,488)

(114)

–

(1,715)

(1,252)

(9,011)

–

27,138

–

4,500

–

31,662

–

1,151

115

1,912

1,322

998

371

(1)

(7)

(132)

(354)

(1)

(285)

–

480

3,463

9,096

(11,977)

1,006

–

4,751

–

(520)

–

(222)

–

(5,646)

(12,608)

109,872

59,723

37,310

18,202

11,728

11,469

10,399

9,714

8,011

7,036

7,004

6,112

6,024

5,342

4,862

3,560

27,611

343,981

In 2023, the column “Conversion differences and other movements” included increases relating to a
significant influence being obtained over the company Metrovacesa, S.A. (notes 4, 13, 17 and 30) and the
capital increase in Giant Cement Holding Inc. for the sum of 101,810 thousand. It also includes the impact
of the transfer of CI III Lostock EFW Limited, Lostock Sustainable Energy and Lostock Power Limited from
the FCC PFI Holding Group to the FCC Environment (UK) Group for the sum of 33,035 thousand euros.

This transfer is the main effect that included in the “Variation in loans” column for the FCC PFI Holding
Group for the sum of 78,773 thousand euros.

The assets, liabilities, turnover and profit/(loss) for 2023 and 2022 are presented below, in proportion to the
shareholding in the capital of each associate.

Non-current assets

Current assets

Non-current liabilities

Current liabilities

Revenue

Operating profit/(loss)

Profit before tax

Profit attributable to the Parent Company

2023

890,757

778,091

679,754

307,254

479,187

13,461

(3,241)

(5,847)

2022

660,762

265,136

556,167

189,345

401,879

13,104

2,426

991

Variations compared to the previous year can mainly be attributed to having obtained a significant influence
over Metrovacesa, S.A. which is now consolidated under the equity method, as the Group has been
represented on its governing bodies since December. This company contributed an investment value of
402,120 thousand euros at year-end (notes 4, 13, 17 and 30).

317

Below, due to its relevance, the summarised financial information of company Metrovacesa, S.A. can be
consulted at 31 December 2023, having recognised its net assets at their fair value to which the equity
method was applied:

Non-current assets

Current assets

Inventory

Cash and equivalents

Other current assets

TOTAL ASSETS

Equity

Equity Parent Company

Capital

Reserves

Own shares

Other equity instruments

Profit/(Loss) Parent Company

Valuation adjustments

Non-controlling interests

Non-current liabilities

Non-current financial liabilities

Other non-current liabilities

Current liabilities

Current financial liabilities

Other current liabilities

TOTAL LIABILITIES

Balance Sheet

2023

395,567

2,417,297

2,106,161

196,298

114,838

2,812,864

1,895,455

1,092,070

803,842

(1,668)

1,211

–

362,006

269,168

92,838

555,403

204,758

350,645

2,812,864

Consolidated Group | Notes to the consolidated financial statements | Page 41 of 139

12. Joint agreements. Joint operations

As indicated in note 2.b), section "Joint arrangements", the Group companies carry out part of their activity
through participation in contracts that are operated jointly with other non-Group partners, mainly through
joint ventures and other entities with similar characteristics, contracts that have been proportionately
included in the accompanying financial statements.

Below are the key figures of the jointly operated contracts that are included in the different headings of the
accompanying balance sheet and consolidated income statement, in proportion to their participation, as at
31 December 2023 and 2022.

318

13. Non-current financial assets
and other current financial assets

There are no significant "Non-current financial assets" or "Other non-current financial assets" in arrears.
The most significant items in the accompanying consolidated balance sheet under the aforementioned
headings break down as follows:

a) Non-current financial assets

Non-current financial assets at 31 December 2023 and 2022 are distributed as shown below:

Non-current assets

Current assets

Non-current liabilities

Current liabilities

Results

Revenue

Gross operating profit/(loss)

Net operating profit/(loss)

2023

210,215

1,646,408

51,413

2022

203,796

1,459,053

46,847

1,724,716

1,572,217

2023

1,508,275

1,013,815

146,585

110,130

143,772

111,086

Agreements managed through joint ventures, joint ventures and other similar entities imply joint and
several liability for the activity carried out by the participating partners.

In relation to contracts managed jointly with third parties outside the Group, guarantees totalling
€2,024,073 thousand (€1,914,575 thousand in 2022) were provided, mostly to public bodies and private
customers, to guarantee the successful completion of urban sanitation works and contracts.

The joint ventures have no relevant property, plant and equipment acquisition commitments.

Equity instruments

Derivatives

Collection rights concession
arrangements

Deposits and guarantees

Other financial assets

2022

Equity instruments

Derivatives

Collection rights concession
arrangements

Deposits and guarantees

Other financial assets

Financial assets
at amortised
cost

Financial assets at
fair value charged
to reserves

Hedging
derivatives

Total

–

547,318

76,420

65,461

689,199

–

551,455

75,269

75,183

30,244

–

3,789

34,033

–

25,193

–

30,244

25,193

547,318

76,420

69,250

25,193

748,425

162,959

–

162,959

–

6,356

39,345

–

39,345

551,455

75,269

81,539

701,907

169,315

39,345

910,567

Consolidated Group | Notes to the consolidated financial statements | Page 42 of 139

The decrease under “Financial assets at fair value charged to reserves” can be attributed to the fact
that in December 2023, Metrovacesa, S.A. was consolidated under the equity method having achieved
significant influence over the company (notes 4, 11, 17, 26 and 30). At 31 December 2022, the fair value
of the investment in this company amounted to 133,471 thousand euros. In turn, the decrease in hedging
derivatives mainly reflects the decrease in the fair value of variable interest rate to fixed rate swaps given
the expectation of interest rate cuts in the coming years (note 17).

The breakdown of the "Equity instruments" heading at 31 December 2023 and 2022 is detailed below:

% Effective ownership

Fair value

2023

Participations equal to or greater than 5%:

Vertederos de Residuos, S.A.

Shariket Miyeh Djinet, S.p.a

Consorcio Traza, S.A.

Cafasso N.V.

Other

Participations below 5%:

Other

2022

Participations equal to or greater than 5%:

Metrovacesa, S.A.

Vertederos de Residuos, S.A.

Shariket Miyeh Djinet, S.p.a

Consorcio Traza, S.A.

Cafasso N.V.

Other

Participations below 5%:

Other

16.03%

13.01%

16.60%

15.00%

13.81%

16.03%

13.01%

16.60%

15.00%

9,187

8,996

3,919

2,744

4,112

1,286

30,244

133,471

10,639

10,167

3,628

2,744

1,792

518

162,959

319

The expected maturities of "Deposits and guarantees", "Receivables under concession agreements" and
"Other financial assets" are as follows:

2025

2026

2027

2028

2029 and
beyond

Total

Deposits and guarantees

3,906

3,516

961

1,686

66,351

76,420

Collection rights concession
agreement (notes 3.a) and 10)

Non-commercial loans and
other financial assets

51,951

45,523

50,047

54,372

345,425

547,318

9,590

9,217

18,645

20,975

7,034

65,461

65,447

58,256

69,653

77,033

418,810

689,199

Non-commercial loans mainly include the amounts granted to public entities for debt refinancing in the
water services activity, that accrue interest in accordance with market conditions. There were no events
during the year that suggests uncertainty regarding the recovery of these loans.

The deposits and guarantees basically correspond to those made by legal or contractual obligations in the
development of the activities of the Group companies, such as deposits for electrical connections, for the
guarantee in the execution of works, for rental of real estate, etc.

b) Other current financial assets

This heading of the accompanying consolidated balance sheet includes the financial deposits constituted
by contractual guarantees, the collection rights derived from concessionary financial assets (note 10)
maturing within less than twelve months, current financial investments made for more than three months
to meet certain specific treasury situations, credits granted to companies accounted for using the equity
method and loans to current third parties.

320

Consolidated Group | Notes to the consolidated financial statements | Page 43 of 139

The details of “Other Current Financial Assets” at 31 December 2023 and 2022 is as follows:

14. Inventories

2023

Derivatives

Collection rights concession
arrangements

Deposits and guarantees

Other financial assets

2022

Derivatives

Collection rights concession
arrangements

Deposits and guarantees

Other financial assets

Financial
assets at
amortised cost

Financial
assets at fair
value charged
to profit and
loss

Hedging
derivatives

Total

–

61,247

90,754

103,292

255,293

–

53,881

61,377

96,569

211,827

–

2,441

5,252

–

5,252

61,247

90,754

103,292

5,252

260,545

6,984

–

6,984

53,881

61,377

99,010

6,984

221,252

Other financial assets mainly include current loans granted and other accounts receivable from joint
ventures and associates for the sum of 34,993 thousand euros (49,037 thousand euros in 2022), current
loans to third parties for the sum of 38,504 thousand euros (33,525 thousand euros in 2022) and deposits
in credit institutions for the sum of 20,507 thousand euros (8,838 thousand euros in 2022).

The average rate of return obtained by these items is in market returns according to the term of each
investment.

The breakdown of “Inventory net of impairment” at 31 December 2023 and 2022 was as follows:

Real estate

Raw materials and other supplies

Construction

Cement

Integrated Water Management

Environmental Services

Real Estate

Concessions

Corporation

Finished goods

Advances

2023

2022

719,718

354,799

763,867

275,387

156,312

88,526

30,007

78,764

1,178

–

102,435

90,961

28,104

52,618

191

1,070

23,267

136,554

1,234,338

20,917

83,031

1,143,202

"Real estate" includes plots for property development, mostly for residential use and property
developments in the course of production or completed, for which there are sales commitments for a final
delivery value to customers of 135,750 thousand euros (119,610 thousand euros in 2022). The advances
that some customers have paid on behalf of the aforementioned "Real Estate" are guaranteed by insurance
contracts or bank guarantees, in accordance with the requirements established by the regulations in force.

The Group classifies property developments as current on the basis of their production cycle,
distinguishing between property developments in progress and completed developments. Property
developments in progress are classified as short-cycle when the period to completion is estimated to be
less than twelve months, and as long-cycle otherwise. After the development is completed, it is classified
as a completed property development.

Consolidated Group | Notes to the consolidated financial statements | Page 44 of 139

321

The composition of the balance of the item "Real estate" at 31 December 2023 and 2022 is as follows:

Los movimientos de los diversos elementos de la partida “Bienes inmobiliarios” habidos en los ejercicios
2023 y 2022 han sido los siguientes:

2023

Land and plots

Short-cycle property developments in progress

Long-cycle property developments in progress

Finished property developments

Total

2022

Land and plots

Short-cycle property developments in progress

Long-cycle property developments in progress

Finished property developments

Cost

Impairment

Net value

651,917

67,683

155,385

49,192

(138,376)

513,541

(528)

(59,011)

(6,544)

67,155

96,374

42,648

924,177

(204,459)

719,718

675,770

58,086

142,027

67,435

(107,526)

568,244

(768)

(63,496)

(7,661)

57,318

78,531

59,774

Total

943,318

(179,451)

763,867

Short-cycle
property
developments
in progress

Long-cycle
property
developments
in progress

Finished
property
developments

Land and
plots

Balance at 31.12.21

730.234

44.181

Additions or allocations

39.230

141.112

143.819

108.915

61.694

20.254

Derecognitions, disposals
or reductions

(79.747)

(152.653)

(76.926)

(33.527)

Impairment

(175.505)

(15.736)

22.441

Translation differences

–

(2)

(13.949)

25.446

(33.781)

19.014

(10.649)

Change in scope, transfers
and other changes

Balance at 31.12.22

Additions or allocations

Derecognitions, disposals
or reductions

675.770

12.736

(5.884)

58.086

60.532

–

142.027

67.435

(179.451)

12.611

1.859

–

(101.220)

(38.345)

13.284

(4)

751

–

81.118

Translation differences

(38)

Change in scope, transfers and
other changes

(30.667)

(50.935)

Balance at 31.12.23

651.917

67.683

155.385

49.192

(204.459)

Consolidated Group | Notes to the consolidated financial statements | Page 45 of 139

A breakdown of the main real estate products is shown below:

Estates and promotions Tres Cantos (Madrid)

Estates and Promotions El Molar (Madrid)

Estates and promotions Badalona (Barcelona)

Estates and promotions Sant Joan Despí (Barcelona)

Estates and promotions Arroyo Fresno (Madrid)

Estates and Promotions Valdebebas (Madrid)

Estates and Developments Alcorcón

Estates and Promotions San Gregorio (Zaragoza)

Estates and Promotions Esencia Sabadell (Barcelona)

Estates and Promotions Marítimo (Valencia)

Estates and Promotions Ensanche Vallecas (Madrid)

Estates and Promotions Nueva Condomina Golf (Murcia)

Estates and Developments Torres del Mar (Las Palmas)

Estates and Promotions Las Glorias (Barcelona)

Estates and Promotions Arroyo Encomienda (Valladolid)

Other properties and developments

2023

201,550

58,060

54,357

43,622

38,449

14,130

13,860

12,750

12,460

11,100

10,610

10,430

9,380

4,370

–

224,590

719,718

322

2022

179,472

53,064

44,739

35,356

73,231

10,110

9,354

13,800

20,400

10,847

11,997

11,642

10,080

17,668

12,823

249,284

763,867

Through the application of the comparison method, the necessary comparable data are obtained by
means of an analysis of the real estate market based on concrete information, which can be used as
variables in the dynamic residual method. In the aforementioned selection, the values of those variables
that are abnormal have been previously checked in order to identify and eliminate those from transactions
and offers that do not meet the conditions required in the definition of fair value, as well as those that
could include speculative elements or those that include particular conditions specific to a specific agent
and which are far removed from the reality of the market. After defining, determining and specifying the
variables to be used in the dynamic residual method, the value of the land, discounted to the closing
date of the accompanying consolidated financial statements, is calculated considering the future flows
associated with the development and promotion of this land, both collections and payments, based on
market price assumptions (basically sale and construction prices) and development, construction and
marketing periods in accordance with the circumstances of each specific case.

For the assessments carried out by the independent expert for completed properties, the assessment
method used is that of direct comparison with market transactions.

The total value of real estate inventories determined by independent experts amounted to 750,584
thousand euros at 31 December 2023 (813,950 thousand euros as at 31 December 2022).

The key assumptions considered in making the assessments are:

• Temporary deadlines affecting the obtaining of licences and the commencement of urbanisation and/or

construction works.

• Sales range: which affect both a range of sales prices, and the percentage and timing of marketing, and

the actual and effective sale of the different properties.

• Discounted rates of cash flows generated that reflect risk and time value of money.

Property inventories are valued at the lower of acquisition or production cost adjusted, where appropriate,
to market value.

In 2023, the total accumulated balance of impairment of property inventories amounts to 204,459
thousand euros (179,451 thousand euros in 2022).

In order to determine whether impairment exists, the Group has estimated the fair value of the main
assets comprising its real estate inventory portfolio through independent third parties (TINSA, SAVILLS
and GESVALT). The appraisals have been performed following the criteria of RICS (Royal Institution of
Chartered Surveyors) measured at the closing date of these consolidated financial statements. The
Dynamic Residual, comparison and cash flow discount methods were applied as the best approximation
of the value. The Dynamic Residual Method is the basic, essential and fundamental method used in
the assessment of land and property, and is the most widely accepted method by real estate market
participants. However, as it uses different variables in its operating scheme, the data to be used as
variables must be extracted directly from the market, through the instrumental use of the benchmarking
method.

There are no significant commitments to purchase real estate assets at year-end.

The "Raw materials and other supplies" include facilities necessary for the execution of works pending
incorporation, building materials and storage elements, spare parts, fuel and other materials necessary in
the development of activities.

Consolidated Group | Notes to the consolidated financial statements | Page 46 of 139

15. Commercial debtors, other accounts
receivable and other current assets

323

Below is the breakdown by age of the balance of "Trade receivables for sales and services" at 31 December
2023:

less than
1 year

between
1 and 2 years

more than
3 years

Total

2,339,214

84,671

54,872

2,478,757

a) Trade receivables for sales and services

Trade receivables for sales
and services

This heading of the accompanying consolidated balance sheet includes the value of the production and
services rendered pending collection, valued as indicated in Note 3.s), which provide the various Group
activities and which are the basis of the operating profit.

The following is the breakdown of "Receivables external to the Group" at 31 December 2023 and 2022:

The loans for commercial operations in default are as follows:

Progress billings receivable and trade receivables for sales

Completed output pending certification

Warranty retainers

Production billed to associated and jointly controlled companies

Trade receivables for sales and services

Advances received for orders (Note 21)

Total trade receivables for sales and services

2023

2022

1,292,894

1,160,660

1,036,769

747,603

58,254

90,840

53,342

59,204

2,478,757

2,020,809

(646,686)

(647,029)

1,832,071

1,373,780

The total amount corresponds to the net balance of receivables having considered the corrections for
insolvency risk amounting to 260,364 thousand euros (248,794 thousand euros as of 31 December 2022)
and deducting the item of advances received for orders listed under the heading "Trade payables and other
accounts payable" of the liability side of the accompanying consolidated balance sheet. This item also
includes the certified amounts of advances for various items, regardless of whether or not they have been
paid.

Construction

Environmental Services

Water

Concessions

Corporation

TOTAL

Balances are considered to be in default when their due date has passed and they have not been paid
by the counterpart. However, it must be taken into account that given the different characteristics of the
different sectors in which the FCC Group operates, although certain assets are in default, there is no risk
of default, since most of its clients are public clients, in which only delays in collections can occur, as it is
entitled to claim the corresponding delay payment surcharges.

"Certified production pending collection and trade receivables" mainly includes the amount of the
certifications issued to customers for works executed in the Construction segment in the amount of
295,593 thousand euros (242,859 thousand euros at 31 December 2022) and services provided by other
segments in the amount of 997,300 thousand euros (917,801 thousand euros as of 31 December 2022),
pending collection at the date of the consolidated balance sheet. In general, there are no disputes in
relation to the above.

2023

33,430

247,268

165,342

–

2022

41,179

238,529

135,486

–

446,085

415,239

Consolidated Group | Notes to the consolidated financial statements | Page 47 of 139

324

The difference between the amount of production recorded at inception for each of the works and
contracts in progress, assessed according to the criteria set out in note 3.s), and the amount certified
up to the date of the consolidated financial statements is recorded as "Production executed pending
certification". This heading is broken down by activity segments as follows:

b) Other receivables

The breakdown of the "Other receivables" at 31 December 2023 and 2022 was as follows:

Construction

Environmental Services

Water

Real Estate

Other

TOTAL

2023

536,464

342,076

151,514

6,212

503

2022

318,246

284,998

135,862

8,111

386

Public Administrations - VAT receivable (Note 23)

Public Administrations - Other taxes payable (Note 23)

Other loans

Advances and credits to staff

Total other receivables

1,036,769

747,603

c) Other current assets

2023

143,260

79,683

97,176

3,206

323,325

2022

103,972

63,762

131,930

2,271

301,935

This heading mainly includes amounts paid by the Group in relation to certain agreements for the provision
of services, which have not yet been recognised as expenses in the accompanying income statement as
they had not yet been accrued at the end of these financial statements.

The previous table mainly includes two concepts: On the one hand, completed work pending certification
corresponding to the construction agreements carried out by the Group, mainly in the Construction
segment, amounting to 554,475 thousand euros (333,215 thousand euros at 31 December 2022). The
aforementioned balance mainly includes the differences between the production executed, valued at
selling price, and the certification carried out to date in accordance with the contract in force, amounting to
527,440 thousand euros (286,954 thousand at 31 December 2022), i.e. production recognised according
to the degree of progress arising from differences between the time at which the production of the work,
covered by the contract signed with the customer and approved by the latter, is executed and the time at
which the latter proceeds to its certification.

It also includes services rendered mainly in the Environment and Water activities which are invoiced more
frequently than monthly, basically corresponding to work carried out in the normal course of business
amounting to 377,866 thousand euros (325,510 thousand euros at 31 December 2022).

The amount of the transfer of customer loans to financial institutions without the possibility of recourse
against the Group companies in the event of default amounts to 6,793 thousand euros at year-end (2,094
thousand euros at 31 December 2022). The impact on cash flows of loan assignments is reflected in the
"Changes in working capital" heading of the Statement of Cash Flows. This amount has been reduced from
the "Progress billings receivable and trade receivables for sales".

Consolidated Group | Notes to the consolidated financial statements | Page 48 of 139

325

16. Cash and cash equivalents

17. Equity

This item includes the Group's cash and cash equivalents, as well as bank deposits and deposits with an
original maturity of three months or less. These balances were remunerated at market interest rates in
both 2023 and 2022.

The accompanying Statement of Changes in Total Equity at 31 December 2023 and 2022 shows the
evolution of equity attributed to the shareholders of the Parent and non-controlling interests in the
respective years.

The breakdown by currency of the cash and cash equivalents position for 2023 and 2012 is as follows:

Euro

United States dollar

Pound sterling

Saudi riyal

Romanian leu

Canadian dollar

Algerian dinar

Czech koruna

Georgian lari

Other European currencies

Latin America (various currencies)

Other

Total

2023

732,399

290,251

216,975

111,465

61,559

45,395

24,915

14,582

659

39,241

52,298

19,964

2022

590,950

276,303

245,211

199,037

21,734

8,089

14,845

20,797

12,635

29,722

132,109

24,106

1,609,703

1,575,538

Under certain financing agreements, especially project finance, there is an obligation to hold minimum
amounts as security for obligations under such agreements amounting to 231,1 million euros (242 million
euros in 2022).

The Ordinary General Shareholders' Meeting held on 14 June 2023, approved the reduction of the share
capital of Fomento de Construcciones y Contratas, S.A. by a maximum nominal amount of 3.725.383
euros, through the redemption of up to 3,725,383 treasury shares with a nominal value of one euro.

The Board of Directors, at its meeting on 14 June 2023 after the General Shareholders' Meeting, decided
to proceed with the agreement for the distribution of the reduction of share capital through the redemption
of treasury stock for the definitive amount established of 3,521,417 shares, bringing the share capital
to 434,823,566 shares with a nominal value of one euro. On June 27, 2023, the public deed of the
aforementioned capital reduction was registered in the Barcelona Mercantile Registry.

The capital reduction for the sum of 3,521 thousand euros meant a decrease in the balance of treasury
stock in the amount of 34,304 thousand euros, taking the difference for the sum of 30,783 thousand euros
to voluntary reserves as well as making the mandatory provision of a restricted reserve for amortised
capital for the sum of 3,521 thousand euros, equal to the nominal value of the amortised shares, charged
to voluntary reserves.

Furthermore, the aforementioned Ordinary General Shareholders Meeting held on 14 June 2023, agreed to
the distribution of a flexible dividend (scrip dividend), and the Board of Directors, at its meeting on 28 June
2023, agreed to execute the agreement, for the maximum value of 219,172,491.50 euros. Shareholders
received the corresponding allocation rights and were able to choose between three options: the sale of
rights to FCC for EUR 0.50, transfer of the rights on the market or to refrain from transferring them and
receiving new shares released. The exchange ratio was set at one new share for every 19 old shares, with a
remuneration mechanism set up for shareholders who chose to receive new shares with a compensatory
dividend in cash.

On 17 July 2023, the negotiation period for the allocation rights ended, with the holders of 99.18% of
rights opting to receive new shares. Thus, 22,697,739 new shares were issued, corresponding to 5.22% of
the share capital prior to the increase. In turn, the compensation mechanism set out above entailed the
disbursement of 17,669 thousand euros by the Group. The remaining 0.82% chose to receive the sum in
cash, resulting in an additional cash outflow for the Group of EUR 1,783 thousand.

Furthermore, the Extraordinary General Shareholders Meeting held on 19 July 2023 adopted resolutions
including but not limited to the following:

• Reduction of the share capital by a nominal amount of 854,234.00 euros through the redemption of a

maximum of 854,234 treasury shares with a nominal value of one euro.

The Board of Directors, at its meeting on 19 July 2023 after the Extraordinary General Shareholders'
Meeting, decided to proceed with the agreement for the distribution of the reduction of share capital
through the redemption of treasury stock for the nominal amount established of 854,234 shares,
bringing the share capital to 456,667,071 shares with a nominal value of one euro. On 25 July 2023,
the public deed for the aforementioned reduction in capital was registered in the Mercantile Registry of
Barcelona.

The capital reduction for the sum of 854 thousand euros meant a decrease in the balance of treasury
stock in the amount of 7,282 thousand euros, taking the difference for the sum of 6,428 thousand euros
to voluntary reserves as well as making the mandatory provision of a restricted reserve for amortised
capital for the sum of 854 thousand euros, equal to the nominal value of the amortised shares, charged
to voluntary reserves.

• The reduction in share capital through the acquisition of treasury stock for subsequent amortisation

through a takeover bid formulated by the Company and addressed to its shareholders for a maximum of
32,067,600 treasury shares, with a nominal value of one euro each, representing 7.01% of the company's
share capital, at a price of 12.50 euros per share.

The Board of Directors, at its meeting on 19 July 2023 after the Extraordinary General Shareholders'
Meeting, decided to proceed with the agreement for the distribution of the reduction of share capital
through the redemption of treasury stock for the nominal maximum amount of 30,027,600.00 euros,
under the terms agreed thereby. Specifically, the Board of Directors determined that the formulation
of the takeover bid would be made after the end of the opposition period of the creditors of the capital
reduction, which ended on 21 August 2023, without any of the Company's creditors having opposed this
reduction.

On 25 October 2023, the National Securities Market Commission (CNMV) authorised the takeover bid.
The acceptance period was extended from 30 October 2023 to 30 November 2023, both inclusive.

On 6 December 2023, the result of the takeover bid was announced, accepted by 20,560,154 shares,

accounting for 64.20% of the shares to which the bid was aimed and 4.50% of the share capital in the
Company. The disbursement made amounted to 257,002 thousand euros. On 19 December 2023, the
public deed for the aforementioned reduction in capital was registered in the Mercantile Registry of
Barcelona.

326

The capital reduction of 20,560 thousand euros led to a decrease in the balance of treasury stock for the
sum of 257,002 thousand euros, taking the difference of 237,271 thousand euros to voluntary reserves,
net of costs inherent to the operation.

In relation to 2022, the Ordinary General Shareholders' Meeting held on 14 June 2022, agreed to the
distribution of a scrip dividend for the maximum value of 170,069,454.40 euros. Shareholders received
the corresponding allocation rights and were able to choose between three options: sale of rights to FCC
for 0.40 euros, transfer of the rights on the market or to refrain from transferring them and receiving new
shares released. The exchange ratio was set at one new share for every 28 old shares. Shareholders who
chose this option also received a compensatory cash dividend of 0.493 euros for each new bonus share
received, to make this financially equivalent to transferring their rights to the company.

On 4 July 2022, the negotiation period for the allocation rights ended, with the holders of 97.94% of rights
opting to receive new shares. As such, 14,871,347 new shares corresponding to 3.50% of the capital stock
prior to the increase were issued, resulting in the disbursement of a compensatory dividend, as well as the
rights acquired by the Company for the sum of 10,783 thousand euros.

The Ordinary General Shareholders' Meeting held on 14 June 2022, approved the reduction of the share
capital of Fomento de Construcciones y Contratas, S.A. by a maximum nominal amount of 1.700.000
euros, through the redemption of up to 1,700,000 treasury shares with a nominal value of one euro.

The Board of Directors, at its meeting on 14 June 2022 after the General Shareholders' Meeting of
Fomento de Construcciones y Contratas, S.A., decided to proceed with the agreement for the reduction
of share capital through the redemption of treasury stock for the maximum amount established by the
General Shareholders' Meeting, i.e. 1,700,000 shares, bringing the share capital to 438,344,983 shares with
a nominal value of one euro. On 18 July 2022, the public deed for the aforementioned reduction in capital
was registered in the Mercantile Registry of Barcelona.

The capital reduction of 1,700 thousand euros led to a decrease in the balance of treasury stock for the
sum of 17,910 thousand euros, taking the difference of 16,210 thousand euros to voluntary reserves.
Having also constituted the restricted reserve for redeemed capital as required for an amount of 1,700
thousand euros, equal to the nominal value of the redeemed shares, charged to voluntary reserves.

327

In October, the sale of 24.99% of the capital in FCC Servicios Medio Ambiente Holding, S.A. to Canadian
pension fund, CPP Investments was completed for the sum of 965,000 thousand euros (note 4). This sale
was considered an equity transaction and as a result, had no impact on the accompanying consolidated
statement of profit and loss. This transaction resulted in an increase in consolidation reserves of 693,864
thousand euros, an increase in valuation adjustments of EUR 18,723 thousand and an increase in non-
controlling interests of EUR 241,310 thousand.

In December 2023, FCyC, S.A. acquired an additional stake in Realia Business, S.A., for the sum of 105,000
thousand euros (note 4). Given that, before the purchase, the Group already held control over the company,
the difference between the purchase price and the book value of the acquired non-controlling interests
generated an increase in the consolidation reserves of 33,412 thousand euros, a decrease of in non-
controlling interests of 139,047 thousand euros and an increase in valuation adjustments of 635 thousand
euros.

Since December 2023, Metrovacesa, S.A., which has previously been considered a financial asset at fair
value charged to reserves, is now consolidated under the equity method having achieved significant
influence over the company (notes 4, 11, 26, 13 and 30). During 2023, given the change in the fair value
of the financial asset, there was an increase in revaluation reserves, which, when consolidated under the
equity method, have been transferred to consolidation reserves along with the amount accumulated from
2022, resulting in an increase in consolidation reserves in the FCC Group for the sum of 46,663 thousand
euros.

On 2 February 2022, FCC Aqualia, S.A. acquired a 65% stake in the Georgia Global Utilities Group, which,
following the spin-off of the energy activity, represented 80% of the public water services business (note
4). FCC Aqualia, S.A. holds a put option and a call option for the 20% stake held by the non-controlling
interest in the public water services business. This put option was recognised as a financial liability at
fair value (note 19) rather than as an equity instrument, meaning that the non-controlling interests are
not recognised for the interest affected by the put option. The difference between the fair value of the put
option and the value that the non-controlling interests would hold on the closing date in the absence of the
put option, is booked as an equity transaction and is charged to reserves, as at 31 December 2022; this
difference came to 1,961 thousand euros. At 31 December 2023, the allocation to reserves in relation to
the inclusion in accounts of the put option was worth 913 thousand euros.

The rest of the "Other changes in equity" in the attached Statement of Total Changes in Equity basically
includes the distribution of the results obtained by the Group in the previous year.

I. Equity attributable to the Parent

a) Capital

The capital of Fomento de Construcciones y Contratas, S,A. comprises 436,106,917 ordinary shares
represented through book entries with a par value of 1 euro each.

All shares are fully subscribed and paid and carry the same rights.

The securities representing the capital stock of Fomento de Construcciones y Contratas, S.A. are admitted
to official listing on the four Spanish stock exchanges (Madrid, Barcelona, Bilbao and Valencia) via Spain’s
Continuous Market.

In relation to the part of the capital held by other companies, directly or through their subsidiaries, when it
exceeds 10%, on the reporting date, Control Empresarial de Capitales, S.A. de C.V., controlled by the Slim
family, holds directly and indirectly, at the date of preparation of these accounts, 69.58%. Furthermore,
Finver Inversiones 2020, S.L.U., 100% owned by Inmobiliaria AEG, S.A. de C.V., which in turn is controlled by
Carlos Slim Helú, has a 11.91% holding. Finally, the company Nueva Samede Inversiones 2016, S.L.U. has a
direct holding of 3.18% of the capital. Esther Koplowitz Romero de Juseu also holds 151,102 direct shares
in Fomento de Construcciones y Contratas, S.A.

b) Accumulated earnings and other reserves

The composition of this heading of the accompanying consolidated balance sheet as at 31 December
2023 and 2022 is as follows:

Reserves of the Parent

Consolidation reserves

2023

2022

1,628,926

1,833,955

3,462,881

1,899,802

789,659

2,689,461

Consolidated Group | Notes to the consolidated financial statements | Page 51 of 139

328

b.1) Reserves of the Parent Company

Reserve for redeemed capital

This corresponds to the series of reserves set up by Fomento de Construcciones y Contratas, S.A., parent
of the Group, mainly based on retained profits and capital gains and, where appropriate, in compliance with
the different applicable legal provisions.

This reserve includes the nominal value of the amortised treasury shares in 2002, 2008, 2022 and 2023
charged to available reserves, in accordance with the provisions of article 335.c of the Spanish Corporate
Enterprises Act. The reserve for amortised capital is unavailable, other than with the same requirements as
for capital reduction.

The breakdown at 31 December 2023 and 2022 is as follows:

Voluntary reserves

Share premium

Legal reserve

Reserve for redeemed capital

Voluntary reserves and losses from previous years

2023

2022

1,673,477

87,669

12,110

(144,330)

85,035

7,734

133,556

1,628,926

1,899,802

The decrease in voluntary reserves and prior years' losses in 2023 can mainly be attributed to the impact
of the reduction in share capital following the acquisition of capital stock as part of a takeover bid
discussed above for the sum of 237,271 thousand euros.

Share premium

The Spanish Corporate Enterprises Act, as amended, expressly permits the use of the issue premium
account balance to increase capital and does not establish any specific restrictions as to its use for other
purposes.

Legal reserve

In accordance with the Spanish Corporate Enterprises Act, as amended, 10% of net profit for each year
must be transferred to the legal reserve until the balance of this reserve reaches at least 20% of the share
capital. The legal reserve cannot be distributed to shareholders except in the event of liquidation.

The legal reserve may be used to increase capital provided that the remaining reserve balance is greater
than 10% of the increased capital.

Otherwise, until it exceeds 20% of share capital and provided there are no sufficient available reserves, the
legal reserve may only be used to offset losses.

At 31 December 2023, the legal reserve was fully constituted.

Reserves for which there is no type of limitation or restriction on their availability, freely constituted through
profits and capital gains of the Parent Company once the distribution of dividends has been applied and
the provision to legal reserve or other unavailable reserves in accordance with the current legislation.

b.2) Consolidation reserves

This heading of the accompanying consolidated balance sheet includes the consolidated reserves
generated in each of the areas of activity. Also, in accordance with IFRS 10 "Consolidated financial
statements", those derived from changes in the shareholding of Group companies are included as long
as control is maintained, for the difference between the amount of the purchase or additional sale and
the book amount of the interest. Meanwhile, in accordance with IAS 19 "Employee benefits", this section
includes the actuarial profit and loss of pension plans and other social security benefits. The breakdown of
this item as at 31 December 2023 and 2022 is as follows:

Environment

Water

Construction

Cement

Real Estate

Concessions

Corporation

2023

421,481

270,729

49,765

37,591

363,236

269

690,884

1,833,955

2022

438,822

218,512

60,696

38,456

197,546

(15,891)

(148,482)

789,659

Consolidated Group | Notes to the consolidated financial statements | Page 52 of 139

329

The increase in reserves in the Real Estate activity can mainly be attributed to the distribution of the profit
in 2022 (note 27), in addition to the impact of the additional purchase of Realia Business, S.A. for the sum
of 33,412 thousand euros and the consolidation of Metrovacesa, S.A. under the equity method for the
sum of 46,663 thousand euros, as discussed previously in this note. This is in addition to the increase in
Corporation as a result of the sale of 24.99% in FCC Servicios Medio Ambiente Holding, S.A. for the sum of
877,176 thousand euros, as this represents an equity transaction.

As at 31 December 2023, the shares of the Parent Company, owned by it or by subsidiaries, represent
0.01% of the capital stock (0.63% as at 31 December 2022).

d) Valuation adjustments

The breakdown of this accompanying consolidated heading at 31 December 2023 and 2022 was as
follows:

c) Shares and equity interests

This heading includes the Parent Company shares owned by this or other Group companies valued at the
cost of acquisition.

The Board of Directors and the subsidiaries are authorised by the General Shareholders' Meeting of
Fomento de Construcciones y Contratas, S.A. to buy back treasury shares within the limits and pursuant to
the requirements set out in Article 144 et seq. of the Capital Companies Law.

Changes in the fair value of financial instruments

Translation differences

2023

44,630

(84,129)

(39,499)

2022

63,271

(91,113)

(27,842)

The movement and balance of treasury shares at 31 December are set out below:

d.1) Changes in the fair value of financial instruments:

Balance at 31 December 2021

Acquisitions

Accumulated

Balance at 31 December 2022

Acquisitions

Accumulated

Balance at 31 December 2023

Fomento de Construcciones
y Contratas, S.A.

(26,674)

(18,500)

17,910

(27,264)

(271,734)

298,588

(410)

2023

2022

Number
of shares

Amount

Number
of shares

Amount

44,957

(410)

2,741,524

(27,264)

TOTAL

44,957

(410)

2,741,524

(27,264)

Changes in the fair value of taxes of financial assets at fair value with changes in other comprehensive
income (Note 13) and of cash flow hedging derivatives (Note 22) are included in this heading.

The breakdown of the adjustments due to a change in the fair value of the financial instruments as at 31
December 2023 and 2022 is as follows:

Financial assets at fair value with changes
in other comprehensive income

Vertederos de Residuos, S.A.

Metrovacesa, S.A.

Rest

Financial derivatives

Future Valleys Project Co. Limited

Green Recovery Group

Grupo Realia Business

Rest

6,060

–

29,744

5,777

2,457

592

2023

2022

6,060

13,049

9,532

3,408

109

38,570

50,222

32,776

10,756

4,590

2,100

44,630

63,271

Consolidated Group | Notes to the consolidated financial statements | Page 53 of 139

The decrease in Financial derivatives mainly reflects the decrease in the fair value of variable interest rate
to fixed rate swaps given the expectation of interest rate cuts in the coming years (note 13).

d.2) Translation differences

The detail of the amounts included under this heading for each of the most significant companies at 31
December 2023 and 2022 is as follows:

330

The variation during the year can mainly be attributed to the impact of the sale of 24.99% of Environment
activity, with the corresponding 24.99% of the amount at the date of sale having been attributed to non-
controlling interests (note 4).

The net investment before deducting non-controlling interests in currencies other than the euro (converted
to euros in accordance with note 3.k), grouped by geographic markets is as follows:

2023

2022

United Kingdom

(44,520)

(53,934)

(3,084)

United States of America

Georgia

Algeria

Mexico

(81,804)

(18,935)

(120,473)

Czech Republic

Rest

9,269

5,756

(303)

9,739

11,639

26,361

e) Earnings per share

(32,183)

(44,415)

(3,482)

(1,724)

4,549

5,522

(5,492)

5,160

2023

459,027

364,872

245,333

165,769

162,554

107,286

367,723

2022

470,424

268,675

225,189

175,107

145,712

95,585

301,439

1,872,564

1,682,131

Georgia Global Utilities Group

14,282

39,536

Basic earnings per share are obtained by dividing the profit attributable to the parent company by the
weighted average number of ordinary shares outstanding during the year, with earnings per share of €1.32
in 2023 (€0.73 in 2022).

(9,717)

(4,069)

(1,149)

(14,935)

(8,477)

(7,105)

(851)

(16,433)

Profit/(loss)

Profit/(loss) attributed to the Parent

590,988

315,182

2023

2022

Societé des Ciments d’Enfidha

(27,625)

(26,842)

(44)

(27,669)

(45)

(26,887)

Outstanding shares

Weighted average shares

Earnings per share (in euros)

447,956,883

429,496,657

1.32

0.73

16,258

6,783

(84,129)

(91,113)

As at 31 December 2023 the Group has not issued any kind of instruments that can be converted to
shares, so the diluted earnings per share coincide with the basic earnings per share.

Pound sterling

FCC Environment Group (UK)

Green Recovery Group

Dragon Alfa Cement Limited

Rest

US dollar

FCC Environmental Services (USA) Llc.

FCC Group Construcción de América

Giant Cement Holding, Inc.

Rest

Georgian lari

Egyptian pound

Orasqualia Devel. Waste T.P. S.A.E.

Egypt Environmental Services, S.A.E.

Rest

Tunisian dinar

Rest

Other Currencies

Rest

Consolidated Group | Notes to the consolidated financial statements | Page 54 of 139

331

II. Non-controlling interests

The balance of this heading in the accompanying consolidated balance sheet reflects the proportional part
of the equity and the profit or loss for the year after tax of those companies in which the Group's non-
controlling shareholders have ownership interests.

The breakdown of the balance of non-controlling interests of the main companies at the close of 2023 and
2022 is as follows:

18. Non-current and current provisions

The detail of the provisions at 31 December 2023 and 2022 is as follows:

Non-current

1.230.595

1.141.750

2023

2022

2023

FCyC Group (note 4)

FCC Aqualia Group

FCC Servicios MA Holding Group (note 4)

Cementos Portland Valderrivas Group

Other

2022

FCyC Group

FCC Aqualia Group

Green Recovery Group

Cementos Portland Valderrivas Group

Other

Equity

Capital

Reserves

Results

Total

11,132

71,050

2,499

1,139

6,870

699,005

438,212

317,954

11,266

(17,089)

40,192

72,811

37,163

2,748

908

750,329

582,073

357,616

15,153

(9,311)

Liabilities for long-term employee benefits

Dismantling, removal and restoration of fixed
assets

Environmental actions

Litigation

Contractual and legal guarantees and obligations

Actions to improve or expand the capacity of
concessions

15,559

111,330

316,677

40,203

91,874

318,436

Other provisions for risks and expenses

336,516

15,588

108,804

312,794

53,906

77,191

268,179

305,288

92,690

1,449,348

153,822

1,695,860

Current

159,610

148,074

Close-outs and losses on construction contracts

135,402

Other provisions

24,208

125,075

22,999

Equity

Capital

Reserves

Results

Total

11,132

71,050

1,162

11,898

821,788

400,939

58,927

14,972

(3,510)

48,457

87,348

18,129

(1,009)

9,823

881,377

559,337

77,061

15,125

18,211

95,247

1,293,116

162,748

1,551,111

The main variation in this heading is due to the addition of non-controlling interests generated by the sale
of 24.99% of Environment activity for the sum of 241,310 thousand euros, partially offset by the decrease
in non-controlling interests in Real Estate activity having acquired an additional holding in the Realia
Business group, for the sum of 139,047 thousand euros (note 4).

Consolidated Group | Notes to the consolidated financial statements | Page 55 of 139

The changes in the provisions heading in 2023 and 2022 were as follows:

Non-current provision

Current provisions

Change of scope, conversion differences and other
movements

11,803

Balance at 31/12/2021

Asset withdrawal or dismantling expenses

Change of obligations for employee benefits for
actuarial profits and losses

Actions to improve or expand the capacity of
concessions

Endowments/(Reversals)

Applications (payments)

Balance at 31/12/2022

Asset withdrawal or dismantling expenses

Change of obligations for employee benefits for
actuarial profits and losses

Actions to improve or expand the capacity of
concessions

Endowments/(Reversals)

Applications (payments)

1,167,340

14,213

(3,854)

45,387

–

147,874

–

3,575

(7,012)

34,366

(127,505)

1,141,750

11,259

5,423

84,127

–

107,263

(138,617)

19,438

(9,822)

Change of scope, conversion differences and other
movements

19,390

1,920

Balance at 31/12/2023

1,230,595

159,610

Within the "allocations (reversals)" item, the allocations for environmental actions for 29,101 thousand
euros (52,392 thousand euros as at 31 December 2022) are noteworthy, as well as provisions for
contractual or legal guarantees or bonds for 16,541 thousand euros (3,771 thousand euros as at
December 2022). This also includes provisions for improvements, replacements, capacity expansions
or major repairs at concessions for the sum of 18,891 thousand euros (16,671 thousand euros as at
December 2022), as well as provisions of 20,231 thousand euros (reversal of 8,511 thousand euros at
December 2022) for risks in works related to Construction activity, mainly internationally. In 2022, there

332

was also a reversal of 17,889 thousand euros for the 2015-2017 tax inspection report (note 23), as well as
16,492 thousand euros for the reversal of provisions for liabilities in the Water activity.

The item "Applications (payments)" includes €3,413 thousand (€13,098 thousand at 31 December
2022) for the application of provisions for risks and expenses related to construction work in the
Construction business. Also included are payments of 29,049 thousand euros (22,018 thousand euros
at 31 December 2022), and 10,190 thousand euros (16,576 thousand euros at 31 December 2022) for
environmental actions, and for replacement and major repair actions on concessions, respectively.
The above movements have an impact on the heading "Other adjustments to profit/(loss) (net) in the
consolidated cash flow statement. Additionally, €58,114 thousand (€35,697 thousand at 31 December
2022) and €12,220 thousand (€11,201 thousand at 31 December 2022) are included for actions to improve
or expand capabilities in concessions, and provisions for decommissioning and retirement of fixed
assets, respectively. These amounts have an impact on the consolidated statement of cash flows under
"Payments for investment in property, plant and equipment, intangible assets and investment property".

3,637

The movement in current provisions is mainly due to construction losses in the Construction business.

148,074

–

The provisions shown in the accompanying consolidated balance sheet are considered to cover the
liabilities that may arise in the course of the Group's various activities.

The schedule of expected payments at 31 December 2023, as a result of the obligations covered by non-
current provisions, is as follows:

Liabilities for long-term employee benefits

Dismantling, removal and restoration of fixed assets

Environmental actions

Litigation

Contractual and legal guarantees and obligations

Actions to improve or expand the capacity of
concessions

Other provisions for risks and expenses

Up to 5 years

Beyond 5 years

Total

6,299

62,990

61,185

31,886

66,575

9,260

48,340

255,492

8,317

25,299

15,559

111,330

316,677

40,203

91,874

174,635

143,801

318,436

201,588

605,158

134,928

336,516

625,437

1,230,595

Consolidated Group | Notes to the consolidated financial statements | Page 56 of 139

333

Liabilities for long-term employee benefits

Contractual and legal guarantees and obligations

The non-current provisions of the accompanying consolidated balance sheet include those that cover the
commitments of the Group companies in matters of pensions and similar obligations, such as medical
and life insurance, as indicated in note 24.

Dismantling, removal and restoration of fixed and non-current assets

The "Expenses for the withdrawal or dismantling of assets" item includes the counterpart of the highest
asset value corresponding to the updated value of the expenses that will be incurred at the time the asset
stops being used.

This heading includes the provisions to cover the expenses arising from contractual and legal obligations
of a non-environmental nature.

Provision for settlement and loss of works

This corresponds to budgeted construction losses in accordance with the assessment principles set out
in note 3.v), and also to the expenses incurred on construction work after completion until final settlement,
systematically determined on the basis of a percentage of the production value throughout the execution
of the work in accordance with experience in the construction activity.

Actions to improve or expand the capacity in concessions

Other provisions for risks and expenses

The "Actions to improve or expand the capacity of concessions" item includes both the counterpart of the
highest value of fixed and non-current assets corresponding to the updated value of the actions on the
infrastructure that the concessionaire will carry out during the concession period for improvements and
capacity expansion, as well as the cost of future replacement actions or major repairs in concessions of
the intangible model.

Environmental actions

The FCC Group develops an environmental policy based not only on strict compliance with current
legislation on the improvement and protection of the environment, but also through the establishment of
preventive planning and analysis and minimisation of the environmental impact of the activities the Group
carries out.

The Management of the FCC Group considers that the contingencies relating to the protection and
improvement of the environment at 31 December 2023, would not have a significant impact on the
accompanying consolidated financial statements, which include provisions to cover the probable
environmental risks that may arise.

Note 28 to these notes to the consolidated financial statements, which is devoted to information on the
environment, complements the foregoing in relation to environmental provisions.

Provisions for lawsuits

Provisions for litigation cover the contingencies of the FCC Group companies acting as defendants in
certain proceedings in relation to the liability inherent to the business activities carried on by them. Any
litigation, which may be significant in number according to estimates made on its final outcome, is not
expected to have an impact on the Group's equity.

This heading includes the concepts not included in the previous accounts.

The value of Other provisions for risks and expenses include various risks associated with the Group's
activity, which, in the normal course of its business, is exposed to claims that mainly entail construction
defects or disputes in relation to the services provided for the sum of 158,328 thousand euros (132,145
thousand euros at December 2022). Part of these risks are covered by insurance contracts and the
corresponding provision is provided for uninsured amounts.

This item also includes provisions related to Alpine for the sum of €11,010 thousand.

It also includes provisions resulting from recognising additional losses above the initial value of the
investment in associates after incurring legal or constructive obligations in relation to the investment in the
associate, amounting to €49,215 thousand (December 2022: €45,591 thousand), the remaining provisions
being of lesser significance and related to the normal operation of the Group.

In relation to the winding up of the Alpine Group, 2023 saw no significant changes in terms of the amount
reported in the Group's 2022 Financial Statements.

In 2006, the FCC Group acquired an absolute majority in Alpine Holding GmbH, hereinafter AH, and thereby,
indirectly in its operating subsidiary company, Alpine Bau GmbH, hereinafter AB. Seven years later, on 19
June 2013, AB filed for insolvency before the Commercial Court of Vienna, but after the unfeasibility of the
reorganisation proposal was established, the insolvency administrator filed for, and the court decreed, the
bankruptcy, closure and liquidation of the company. On 25 June 2013, the liquidation of the company was
commenced. As a consequence of the bankruptcy of AB, its parent company, AH filed for bankruptcy before
the Commercial Court on 2 July 2013, which declared the bankruptcy and liquidation of AH.

As a result of both bankruptcies, FCC Construcción, S.A. loses control over the Alpine Group, interrupting
its consolidation.

As of the date of these consolidated financial statements, the insolvency administrators have reported
recognised liabilities of approximately €1,669 million at AB and €550 million at AH in the respective
liquidation proceedings. The share of the bankrupt estate in AB currently amounts to 15% whereas for AH's
bankruptcy, the bankruptcy administrator has not been able to estimate and determine the share.

Ten years after the bankruptcy of both companies and having definitively closed the criminal proceedings,
won proceedings brought by bondholders and settled a backdating action, two proceedings brought by the
insolvency administrators against Fomento de Construcciones y Contratas, S.A. and FCC Construcción
S.A. are still pending, in addition to other proceedings against auditors, former directors and banks
involved in the acquisition of bonds issued by AH in 2010, 2011 and 2012 and admitted to trading on the
Luxembourg and Vienna stock exchanges for a combined nominal value of 290 million euros.

During the refinancing of the Alpine Group between October 2012 and June 2013, FCC Construcción, S.A.
provided corporate guarantees to enable AB and a selection of its operating subsidiary companies to bid
for and/or be awarded construction work. As at 31 December 2023, the provision for this item amounted
to 11,010 thousand euros.

Between the bankruptcy of AH and AB and the date on which these financial statements were issued, a
number of proceedings were instigated against the Group and directors of AH and AB. At 31 December
2023, and as far as FCC could be directly or indirectly affected, two commercial proceedings and one
labour proceeding are still in progress:

• In April 2015, the bankruptcy administrator of Alpine Holding GmbH filed a claim for 186 million euros
against FCC Construcción, S.A. and other ex-executive of AB, considering that these parties should
compensate Alpine Holding GmbH for the amounts collected through two bond issues in 2011 and
2012 that were presumably provided by this company for its subsidiary, Alpine Bau GmbH, without the
necessary guarantees and complying with a “mandate-order” from FCC Construcción S.A. On 31 July
2018, the ruling dismissing the claim was handed down and the claimant ordered to pay the costs.
Having filed appeals and cassation appeals for procedural infringement, in April 2020, the Austrian
Supreme Court declared the need to return the Orders to the Court of Instance so that the testimonial
evidence could be practised in person before the Judge of First Instance. Such testimonial statements
took place in June 2021 and, in light of the mandate contained in the Supreme Court Judgment, the
judge has yet to decide whether to consider the procedure closed or whether to agree to the practice
of the expert evidence requested by the bankruptcy trustee AH. On 7 June 2023, the judge ruled that he
was ready to pass sentence.

334

making a deposit at Asesoría Financiera y de Gestión S.A., allegedly made payments charged against
equity, considered to be a capital refund, and therefore prohibited by law. The proceedings are still at
the evidentiary phase, the court expert having issued his report according to which the deposit and the
factoring transactions between subsidiary companies of AB and Asesoría Financiera y de Gestión S.A.
would not have caused any loss to AB. Given the multiplicity of allegations made by the bankruptcy
administrator, the judge is weighing the request for a complementary expert report. On 16 November
2023, a hearing was held at which the legal expert was questioned about various matters in relation to
his report through different instruments submitted by the parties. The same day, the judge declared that
no further instruments or proposed evidence would be admitted and that he would adopt a decision to
be communicated in writing.

Also in April 2017, a former FCC employee and former executive at AH and AB was notified of a claim
filed by the insolvency administrator of Alpine Bau GmbH in the Social Claims Court for 72 million euros.
The claimant argues that this amount represents the damage to the bankruptcy estate caused by the
alleged delay in initiating insolvency proceedings. In the event that the insolvency administrator's claim is
successful and a final judgement is handed down, the subsidiary liability of the FCC Group could be raised
in a remote case due to the explanation contained in note 25 on contingent liabilities.

In terms of these disputes, the FCC Group and its legal advisors do not consider it very probable there will
be any future outflows of cash prior to the issuance of these financial statements; therefore, no additional
provisions have been set aside, as the Group believes that they represent contingent liabilities (note 25).

19. Non-current and current financial liabilities

The general policy of the FCC Group is to provide all companies with the most adequate financing for the
normal development of their activity.

Whenever the financial operation so requires, and following a hedging criterion for economic and
accounting purposes, the Group contracts interest rate risk hedging operations according to the type and
structuring of each operation (Note 22).

In certain financings, and especially in structured financing without recourse, the funder includes a
contractual clause stating that there must be some type of interest rate coverage, studying the best
hedging instrument according to the profile of the cash flows presented by the project, as well as the debt
repayment schedule.

Consolidated Group | Notes to the consolidated financial statements | Page 58 of 139

a) Non-current and current obligations and loans

The breakdown of the issues of current obligations and loans is as follows:

2023

FCC Aqualia, S.A.

FCC Servicios Medio Ambiente Holding, S.A.

Green Recovery Group

2022

FCC Aqualia, S.A.

FCC Servicios Medio Ambiente Holding, S.A.

Fomento de Construcciones y Contratas, S.A.

Green Recovery Group

Non-current

Current

Total

650,009

1,096,115

114,755

9,691

659,700

229,044

1,325,159

7,486

122,241

1,860,879

246,221

2,107,100

650,009

498,361

–

119,214

9,691

659,700

733,795

1,232,156

23,200

6,477

23,200

125,691

1,267,584

773,163

2,040,747

The details of the non-current and current obligations and loans formalised by the Group are detailed
below:

• On 8 June 2017, FCC Aqualia, S.A. successfully completed two simple bond issues. one in the amount
of 700 million euros, annual remuneration of 1.413% and maturing in 2022, repaid in advance on 19
April 2022. The second in the amount of 650 million euros with an annual remuneration of 2.629% and
maturing in 2027.

The outstanding issue is subject to the following guarantees:

– Pledge on 100% of the shares of Tratamiento Industrial de Aguas, S.A., Conservación y Sistemas,
S.A., Sociedad Española de Aguas Filtradas, S.A., Depurplan 11, S.A. and Aigues de Vallirana, S.A.
Unipersonal, and 97% of the shares of Entemanser, S.A.

– Pledge on 100% of the shareholdings of Infraestructura y Distribución General del Agua, S.L., Empresa
Gestora de Aguas Linenses, S.L., Aguas de las Galeras, S.L., Hidrotec Tecnología del Agua, S.L. and on
51% of Aqualia Czech, S.L.

– Pledge on 99.56% of the shares of Acque di Caltanisseta S.p.A. and on 100% of the shares of Aqualia

Mexico, S.A. de C.V.

– Pledge on the collection rights over certain accounts.

The issuance and circulation of both bonds took place on 8 June 2017, being admitted to trading in
the unregulated market (Global Exchange Market) of the Irish Stock Exchange, and with an investment
grade rating from the Fitch and S&P rating agencies. The rating of the outstanding bond was ratified by
Fitch on 8 February 2023 as BBB and by S&P on 21 April 2023 as BBB⁻.

The balance at 31 December 2023 shown for this item amounts to €659,700 thousand (€659,700
thousand in 2022), including €9,691 thousand for accrued and unpaid interest (€9,691 thousand in
2022).

At 31 December 2022, the 650 million euro bond was listed at 97.97%.

• On 4 December 2019, FCC Servicios Medioambiente Holding S.A., successfully completed two simple

bond issues. One amounting to 600 million euros paying annual interest of 0.815% and maturing
in 2023; and the second for the amount of 500 million euros, paying annual interest of 1.661% and
maturing in 2026. The latter has the personal guarantee of FCC Medio Ambiente, S.A.U. and FCC
Ámbito, S.A.U.

The bond amounting to 600 million euros maturing on 4 December 2023 was repaid on that date using
the funds generated from the issuance of a new bond, also for the amount of 600 million euros, paying
annual interest of 5.25% and maturing in October 2029.

Since their issuance, these bonds have been admitted to trading in the unregulated market (Global
Exchange Market) of the Irish Stock Exchange, with an investment grade rating from the Fitch rating
agency. This rating was ratified on 20 September 2023, with a stable outlook (BBB⁻), together with that
of the bond's issuer, the parent company, FCC Servicios Medio Ambiente Holding.

Both bonds were issued under the classification of Green Bonds in line with the GBP principles, which
are reviewed and certified annually by independent organisations (SPOs).

The balance at 31 December 2023 shown for this item amounts to €1,102,309 thousand (€1,098,656
thousand in 2022), including €6,194 thousand for accrued and unpaid interest (€1,210 thousand in
2022).

At 31 December 2023, the new 600 million euro bond was listed at 107.49% and the 500 million euros
bond was listed at 95.44%.

336

b) Non-current and current bank borrowings

The breakdown at 31 December 2023 and 2022 is as follows:

Non-current

Current

Total

Consolidated Group | Notes to the consolidated financial statements | Page 59 of 139

Likewise, in July 2020 and renewed annually, FCC Servicios Medioambiente Holding SAU registered a
promissory note programme - Euro Commercial Paper Programme (ECP) - on the Irish stock market
(Euronext Dublin) in the amount of 400 million euros, which allows issuance with maturities of between
1 and 364 days from the date of issue, in order to meet the financial needs of the area.

At 31 December 2023 the outstanding amount was €222,850 thousand distributed with an average
maturity of 3.6 months (€133,500 thousand at 31 December 2022).

• Since November 2018, Fomento de Construcciones y Contratas, S.A. has had a Euro Commercial Paper
Programme (ECP) registered on the Irish stock exchange (Euronext Dublin) for an amount of 600 million
euros, which allows it to issue notes with maturities of between 1 and 364 days from the issue date, in
order to meet the financial needs of the Group's parent company.

At 31 December 2023, there was no outstanding balance for this concept (23,200 thousand euros at 31
December 2022).

• In June 2018, FCC Medio Ambiente Reino Unido issued debt in the total amount of 145,000 thousand

2023

Credits and loans

Debts without recourse to the
parent

Debts with limited recourse for
project financing:

FCC Medio Ambiente Reino
Unido, S.A.U.

154,822

pounds sterling in two institutional tranches, both structured through the issuance of Private Placement
bonds.

Sociedad Concesionaria
Tranvía de Murcia, S.A.

One of the tranches for 135,000 thousand pounds with a fixed rate of 3.98% and the other tranche for
10,000 thousand pounds with a fixed rate of 4.145%, both due on 17 June 2038. 5,425 thousand pounds
were repaid in 2023.

Aquajerez, S.L.

Other

The guarantees of this issue are detailed in section b).2. of this note.

The balance at 31 December 2023 shown for this item amounts to 122,241 thousand euros (125,691
thousand euros in 2022).

2022

Credits and loans

Debts without recourse to the
parent

Debts with limited recourse for
project financing:

FCC Medio Ambiente Reino
Unido, S.A.U.

Sociedad Concesionaria
Tranvía de Murcia, S.A.

Aquajerez, S.L.

Other

97,604

39,401

68,164

162,817

101,661

44,065

76,787

–

2,023,732

292,999

2,316,731

359,991

33,134

393,125

12,267

4,073

5,341

11,453

167,089

101,677

44,742

79,617

2,383,723

326,206

2,709,929

–

2,086,488

155,837

122,714

155,837

2,209,202

385,330

27,980

413,310

10,253

173,070

3,237

5,006

9,484

104,898

49,071

86,271

2,471,818

306,531

2,778,349

Consolidated Group | Notes to the consolidated financial statements | Page 60 of 139

337

The previous table shows three different Debt groups:

1. Credits and loans

At 31 December 2023, this section mainly includes the financing facilities of FCC, S.A. in the form of credit
facilities and bilateral loans signed for an amount of 215,000 thousand euros (425,000 thousand euros at
31 December 2022) with various financial institutions. At 31 December 2023, no balance was drawn down
on these loans (154,564 thousand euros at 31 December 2022).

2. Debts without recourse to the parent

This item mainly includes financing corresponding to the Real Estate, Water, Cement and Services areas.

• The Real Estate area includes the debt of the Realia Group and Jezzine Uno S.L.U. for the sums of

475,082 and 297,759 thousand euros respectively.

The Realia Group's debt comprises a syndicated loan signed by Realia Patrimonio S.L.U. and several
bilateral financings signed by Hermanos Revilla, S.A.

The syndicated loan was signed by Realia Patrimonio on 27 April 2017, for a total amount of 582,000
thousand euros, with partial maturities and final maturity in April 2024.

On 27 April 2020, it entered into a non-extinguishing modifying novation of the aforementioned loan,
extending the maturity until 27 April 2025 and renegotiating a reduction in the margin applicable to the
reference rate for the calculation of interest and ratifying the current guarantees. As a consequence of
this novation, the applicable interest rate is Euribor plus a variable margin based on the Loan to Value
ratio.

In addition, the aforementioned company entered into an interest rate swap agreement (IRS) for 70% of
the outstanding balance of the loan to reduce the risk of interest rate fluctuations and their impact on
cash flows associated with the hedged financing (note 22).

This financing requires compliance with a series of financial ratios until maturity. At 31 December 2023,
the Company is in compliance with the covenants.

At 31 December 2023, the outstanding balance of this loan stood at 440,494 thousand euros (453,026
thousand at 31 December 2022), with accrued interest amounting to 4,156 thousand euros (2,313
thousand euros at 31 December 2022).

In turn, Planigesa, S.A. is consolidated within the Realia Group (following the absorption of Hermanos
Revilla, S.A. in 2023), which at 31 December 2023 had granted credit facilities and loans with a limit of
60,000 thousand euros (61,000 thousand euros in 2022), of which the loans were fully drawn down for
the sum of 36,000 thousand euros (46,000 thousand euros in 2022). The maturity of the bilateral loans
will occur during 2024.

Jezzine Uno S.L.U. has a loan agreement, entered into on 19 October 2021, amounting to 335,000
thousand euros, with partial maturities and final maturity on 19 October 2026. The interest rate
applicable to this loan is a fixed market rate.

At 31 December 2023, the outstanding balance of this loan stood at 298,000 thousand euros (316,500
thousand at 31 December 2022), with accrued interest amounting to 722 thousand euros (767 thousand
euros at 31 December 2022).

• In the Water Area, the total value of debt in this section came to 1,187,819 thousand euros. Worth

particular note is the syndicated loan taken out on 22 June 2022 by FCC Aqualia S.A. as part of the
refinancing process undertaken.

The value of the syndicated loan comes to 1.1 billion euros, originally maturing in three and having been
extended for one further year in 2023, as permitted in the loan agreement.

At 31 December 2023, the loan was fully drawn down and the balance shown for this item amounts
to 1,097,458 thousand euros (1,096,839 euros thousand in 2022), including 1,346 thousand euros for
accrued and unpaid interest (1,010 thousand euros in 2022).

Also worth note is the bilateral financing taken out on 28 December 2023 by FCC Aqualia USA Corp.
for the sum of 95,000 thousand US dollars, maturing in one year. The funds have been allocated to
acquiring control over Municipal District Services, Llc. (note 4).

This financing has been fully drawn down and its balance at 31 December 2023 amounts to 86,034
thousand euros, of which 61 thousand euros for accrued and unpaid interest.

• In the Cement area, the total value of debts with credit institutions came to 139,263 thousand euros at

31 December 2023 (163,586 thousand at 31 December 2022).

This balance mainly corresponds to a subordinated financing agreement involving Cementos Portland
Valderrivas, S.A. for the original amount of 80,000 thousand euros. This loan was partially repaid,
renewed and amended in July 2020, July 2021, as well as in October 2022 and September 2023.

338

On 20 October 2022, a new agreement was entered into extending the maturity of the loan to 20 October
2025 and changing the interest rate from a fixed rate to a variable Euribor 6M rate plus a market spread.

3. Debts with limited recourse for project financing

Between January and September 2023, repayments were made for the sum of 35,000 thousand euros.

On 21 September 2023, a new agreement was entered into increasing the principal by 35,000 thousand
euros.

In the final quarter of 2023, 30,000 thousand euros were repaid. At 31 December 2023, the outstanding
balance of this loan amounts to 50,405 thousand euros (70,405 thousand euros at 31 December 2022).

Cementos Portland Valderrivas, S.A. has also arranged two bilateral financing transactions for the sum
of €25,000 thousand and €50,000 thousand, maturing in June 2026 and July 2024 respectively, bear
interest at the Euribor rate plus a market spread.

In 2023, a partial voluntary repayment of 5,000 thousand euros was made in relation to the
50,000-thousand euro financing, and on 3 October 2023, the extension of its maturity to July 2025 was
formally arranged.

At 31 December 2023, the outstanding balance of these loans amounted to 25,000 and 45,000 thousand
euros (25,000 and 50,000 thousand euros at 31 December 2022).

In addition, in 2022 two credit facilities were arranged for a total amount of 25,000 thousand euros, the
term of which has been extended by one year during 2023. At 31 December 2023, 11,031 thousand
euros had been drawn down (11,277 thousand euros at 31 December 2022).

• The remainder of the debt in this section corresponds to debt from the Services area, mainly pertaining
to the US subsidiary FCC Environmental Services LLC, from FCC Medio Ambiente S.A.U., from the FCC
Environment CEE subgroup and from other investee companies in Spain.

FCC Medio Ambiente S.A.U. had arranged credit facilities at 31 December 2023 for an amount of
270,000 thousand euros, of which 132,363 thousand euros had been drawn down at 31 December 2023
(from a total of 130,000 thousand euros, 48,645 thousand euros drawn down at 31 December 2022).

In 2023, two long-term bilateral loans were taken out for a total amount of 150,000 thousand euros,
which had not been drawn down as at 31 December 2023.

The FCC Environment CEE Group has arranged 18,399 thousand euros in credit facilities, of which 1,840
thousand euros had been drawn as at 31 December 2023 (620 thousand euros drawn from the 19,711
thousand euros arranged at 31 December 2022).

These include all financing secured solely by the project itself and its cash-generating capabilities, which
will support the entire debt service payment, and which, under no circumstances, will be guaranteed by the
parent company Fomento de Construcciones y Contratas, S.A. or any other FCC Group company.

• FCC Medio Ambiente Reino Unido. The FCC Environment (UK) Group currently has a revolving credit
facility of 30,000 thousand pounds sterling undrawn at 31 December 2023 and maturing in October
2025.

In 2018, FCC Energy Ltd, whose assets are the Eastcroft and Allington incinerators, issued 207,361
thousand pounds sterling of debt. This debt has a 20-year term (final maturity on 17 June 2038) and
three different tranches, two institutional for an initial total amount of 145,000 thousand pounds sterling
described in section a) of this note, and a commercial tranche of 62,361 thousand pounds sterling.
The interest rate of the commercial tranche is a variable rate hedged with an exchange of interest that
makes it fixed plus an upward margin of up to 2.75% during the life of the project.

In total, 2,327 thousand pounds were repaid from commercial tranche in 2023.

The FCC Energy Ltd financing, being project finance, includes the standard guarantees for this type
of financing, such as the pledge of the company's shares and the rest of its assets, which include the
companies that operate the two waste incineration plants.

In October 2016, FCC (E&M) Ltd signed a 142 million pound contract to design, finance, build and
operate the Millerhill Recycling and Energy Recovery Centre (RERC) in Midlothian, located on the
outskirts of Edinburgh. The plant initially had two syndicated loans, a 75,713 thousand pounds sterling
loan maturing in August 2042 and a 36,900 thousand pound loan maturing in May 2020. The margins
on the loan maturing in 2042 range from 3% to 3.5%. Write-downs during 2023 amounting to 2,638
thousand pounds have been made. At the end of 2023 the outstanding debt to be repaid is 65,755
thousand pounds sterling.

As a result of the foregoing, at 31 December 2023, of the total bank borrowings of FCC Medio Ambiente
Reino Unido, S.L.U., relate to FCC Energy Ltd. and 52,679 thousand euros (54,148 thousand euros at 31
December 2022) relate to FCC E&M&M (Edinburgh), affiliate of FCC Environment Developments Ltd.,
73.944 thousand euros (75.360 thousand as at 31 december 2022); (Edinburgh), an investee of FCC
Environment Developments Ltd,; the remaining debt with limited recourse for project financing, up to a
total amount of 167,089 thousand euros, corresponds to the debt of other companies that make up the
FCC Group in the United Kingdom.

339

• Sociedad Concesionaria Tranvía de Murcia, S.A. As explained in note 4, during 2022, the FCC Group

assumed control of this company, incorporating 104,898 thousand euros of debt with credit institutions
as at 31 December 2022.

This financing corresponds to a syndicated loan arranged in February 2018, with six-monthly
repayments maturing on 30 June 2037. At 31 December 2023, the sum of this debt came to 101,677
thousand euros.

• The financing of Aquajerez, S.L. was signed in 2016 and amounted to 40,000 thousand, for a term of

15 years with half-yearly repayments from January 2017. During 2019, FCC Aqualia, S.A., which already
held 51% of this company, acquired the remaining 49% and proceeded to extend the initial loan to
65,000 thousand euros. At 31 December 2023 the amount of this debt is 44,742 thousand euros (49,071
thousand euros in 2022).

The breakdown of the debts with credit institutions by currency and amounts available at 31 December
2023 and 2022 is as follows:

Euros

US dollars

Pounds
Sterling

Other

Total

2023

Credits and loans

–

Debt without recourse to the parent

2,150,117

154,629

–

11,985

2,316,731

Debts with limited recourse for
project financing

177,388

–

167,089

48,648

393,125

• "Rest of Debts with limited recourse for project financing" includes companies with project

financing from the Water areas: Aquos El Realito, S.A. de C.V. with 41,162 thousand and Servicios
Medioambientales, Gipuzkoa Ingurumena Bi, S.A. with 21,108 thousand euros.

2022

2,327,578

154,629

167,089

60,633

2,709,929

As at 31 December 2023 there have been no breaches of financial ratios associated with project financing
debts, and they are not expected to be defaulted during 2024.

Credits and loans

155,837

–

Debt without recourse to the parent

2,125,463

70,317

–

155,837

13,422

2,209,202

The guarantees granted on these loans are real and are based on the financed assets that repay the debt
with own flows, without additional guarantees granted by the Parent to pledge the shares in the vehicle
companies that own the aforementioned financial assets that may have been granted.

Debts with limited recourse for
project financing

187,721

–

173,070

52,519

413,310

2,469,021

70,317

173,070

65,941

2,778,349

The credits and loans in US dollars finance assets in the Environmental Services and Water segments;
those contracted in pounds sterling correspond to the financing of assets of FCC Environment UK; and
those in Other currencies, in 2023, correspond to the financing of Aquos El Realito, S.A. de C.V. in Mexican
pesos amounting to 41,162 thousand euros and Qatarat Saquia Desalination in Saudi riyals for the sum of
7,487 thousand euros.

Consolidated Group | Notes to the consolidated financial statements | Page 63 of 139

340

c) Other non-current financial liabilities

d) Other current financial liabilities

2023

2022

2023

2022

Non-current

Lease debt (Note 9)

Third party financial debts outside the group

Derivative financial liabilities (Note 22)

Deposits and guarantees received

Other concepts

358,372

100,328

1,700

71,918

40,114

Corrientes

346,425

Lease debt (Note 9)

96,418

1,446

68,788

18,803

Interim dividend payable

Third party financial debts outside the group

Suppliers of fixed assets and bills payable

Debts with associated companies and joint ventures

572,432

531,880

Derivative financial liabilities (Note 22)

“Third party financial debts outside the Group” includes the put option on the non-controlling interest in
the GGU Group for the amount of 54,333 thousand euros at 31 December 2023 (54,269 thousand euros at
31 December 2022) and the put option on the non-controlling interest in Municipal District Services, Llc.,
acquired in December 2023, for the sum of 2,443 thousand euros at 31 December 2023 (notes 4 and 17.)

"Derivative financial liabilities" mainly include financial derivatives for risk hedging, mainly interest rate
swaps (note 22).

Deposits and guarantees received

Other concepts

76,478

29,758

15,030

168,968

6,052

57,540

499

78,970

7,496

25,660

79,697

6,049

55,004

540

354,344

253,431

“Suppliers of fixed and non-current assets and bills payable” includes the amount pending payment for the
acquisition from the previous owners of Municipal District Services, Llc. for the sum of 81,433 thousand
euros, which was paid out on 2 January 2024 (notes 4 and 17).

"Guarantees and deposits received" includes the advance payment received for the agreement to sell the
shareholding in Concesionaria Túnel de Coatzacoalcos, S.A. for 48,396 thousand euros in both years,
owned by a company linked to the majority shareholder of the Parent Company. The sale is subject to
conditions precedent, not fulfilled at the date of formulation of these consolidated annual accounts.

Consolidated Group | Notes to the consolidated financial statements | Page 64 of 139

341

e) Schedule of expected due dates

f) Changes in financial liabilities that affect cash flows from financing

El calendario previsto de vencimientos de las deudas con entidades de crédito, obligaciones y empréstitos
y otros pasivos financieros no corrientes, es el siguiente:

2025

2026

2027

2028

2029 y
siguientes

Total

7,658

507,384

658,230

7,257

680,350

1,860,879

578,772

1,428,068

62,757

38,300

275,826

2,383,723

2023

Debt instruments
and other marketable
liabilities

Non-current bank
borrowings

Other financial liabilities

130,612

36,939

34,442

40,325

330,114

572,432

717,042

1,972,391

755,429

85,882

1,286,290

4,817,034

activities

Below are details of the changes in non-current and current financial liabilities, differentiating those that
affected cash flows from financing activities in the Statement of Cash Flows from the remaining changes:

Consolidated Group | Notes to the consolidated financial statements | Page 65 of 139

342

Non-current

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

Current

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

Non-current

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

Current

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

Balance at
1 January
2023

Cash flows
from financing
activities

Exchange
differences

Change
in fair value

Change in the
perimeter and changes
in consolidation
method

Without an impact on cash flows

4,271,282

1,267,584

2,471,818

531,880

1,333,125

773,163

306,531

253,431

607,448

597,709

8,373

1,366

(891,644)

(584,513)

(216,689)

(90,442)

2,905

2,453

4,939

(4,487)

7,638

133

792

6,713

310

–

310

–

(2,560)

–

(2,560)

(380)

–

(380)

Balance at
1 January
2022

Cash flows
from financing
activities

Exchange
differences

3,732,997

1,878,804

1,284,368

569,825

1,820,176

1,152,739

458,189

209,248

847,926

(159,951)

1,050,791

(42,914)

(1,302,515)

(1,038,597)

(181,290)

(82,628)

(13,554)

10,537

(6,080)

(18,011)

3,569

2,040

(556)

2,085

Without an impact on cash flows

Change
in fair value

(21,333)

–

(21,333)

(536)

–

(536)

Change in the
perimeter and changes
in consolidation
method

253,977

142,829

109,690

1,458

11,819

–

8,183

3,636

Other
changes

(62,351)

(6,867)

(101,407)

45,923

478,028

57,438

235,572

185,018

Other
changes

(528,731)

(604,635)

33,049

42,855

800,612

656,981

22,005

121,626

Balance at
31 December
2023

4,817,034

1,860,879

2,383,723

572,432

926,771

246,221

326,206

354,344

Balance at
31 December
2022

4,271,282

1,267,584

2,471,818

531,880

1,333,125

773,163

306,531

253,431

Consolidated Group | Notes to the consolidated financial statements | Page 66 of 139

343

In 2022, "Changes in the scope of consolidation and changes in the consolidation method" included the
amounts contributed by the GGU Group for 145,318 thousand euros following its entry into the scope of
consolidation in February 2022, although part of the contributed debt has subsequently been repaid (notes
4 and 19), and 107,725 thousand euros contributed by Sociedad Concesionaria del Tranvía de Murcia, S.A.
following its integration under the total consolidation method after the company's takeover in November
2022 (note 4).

20. Other non-current liabilities

This heading mainly includes performance obligations under the Buckinghamshire plant concession (note
10) arising from the collection of the intangible component in accordance with the conditions set out in the
agreement amounting to 111,022 thousand euros at 31 December 2023 (112,588 thousand euros at 31
December 2022).

21. Trade and other accounts payable

The breakdown of the "Trade and other accounts payable" heading in the liability side of the balance sheet
as at 31 December 2023 and 2022 is as follows:

Suppliers

Current tax liabilities (Note 23)

Other payables to Public Administrations (Note 23)

Customer advances (Note 15)

Remuneration payable

Other payables

2023

2022

1,252,628

1,232,393

39,254

314,808

646,686

96,521

427,151

23,610

353,372

647,029

84,485

474,845

2,777,048

2,815,734

With regard to the Spanish Institute of Accounting and Accounts Auditing (ICAC) Resolution of 29 January
2016, issued in compliance with the mandate of the Second Additional Provision of Law 31/2014, of 3
December, which amends the Third Additional Provision of Law 15/2010, of 5 July, establishing measures

to combat late payment in commercial transactions, in 2023 the Group operated primarily in Spanish
territory with public clients including the central government, regional government, local corporations and
other public bodies, which settle their payment obligations in periods exceeding the statutory limit in Public
Sector Contract legislation, and in Law 3/2004, of 29 December 2004, establishing measures to combat
late payment in commercial transactions.

It should be noted that the provisions of section 5 of article 228 of the current Consolidated Text of the
Public Sector Contract Law (CTPSCL) apply to the works and supplies derived from contracts signed by
the Group with the different Public Administrations.

Due to such circumstances and in order to adapt the Group's financial policy to reasonable efficiency
levels, the Group has been working throughout 2023 to reduce the usual payment periods insofar as
possible to suppliers in the sectors in which the Group operates.

The Group's payment policy to suppliers, indicated in the foregoing two paragraphs, hence finds support
in: a) payments to suppliers under agreements entered into by the Group with the public authorities,
pursuant to article 228.5 of the CTPSCL, and b) payments to remaining suppliers under the second
transitional provision of Law 15/2010, and, where appropriate, that provided for in article 9 of Law 3/2004,
which excludes from the abusive nature the “deferral of the payment for objective reasons” taking into
consideration, in both cases a) and b) the usual payment period in the sectors in which the Group operates.

The Group also acknowledges and pays suppliers, always by mutual agreement, any late-payment interest
agreed in the contracts, providing negotiable payment methods accompanied by exchange procedures.
Such agreements, aside from being expressly provided for, as mentioned, in the CTPSCL, are admissible
under Directive 2011/7/EU of 16 February, of the European Parliament and the Council.

The Group has also entered into confirming line and similar contracts with different financial institutions
to facilitate early payment to suppliers. In accordance with these contracts, a supplier may exercise
its collection rights against the Group companies or entities and obtain the invoiced amount, less the
financial costs for discount and fees applied by those entities and, in some cases, amounts withheld as
guarantee. The total amount of contracted lines amounts to 56,423 thousand euros at 31 December 2023
(40,026 thousand euros at 31 December 2022), with a drawn down balance of 10,626 thousand euros
at 31 December 2023 (17,909 thousand euros at 31 December 2022). The above-mentioned contracts
do not modify the main payment conditions (interest rate, deadline or amount), so they are classified as
commercial liabilities.

In compliance with the aforementioned Resolution, a table is set out below with information on the
average payment period to suppliers for companies located in Spain, for those commercial operations
accrued from the date of entry into force of the aforementioned Law 31/2014, i.e. 24 December 2014.

344

22. Derivative financial instruments

In general, financial derivatives entered into by the FCC Group receive the accounting treatment provided
for in the regulations for accounting hedges set forth in note 3.p) of this Report, that is, they are operations
that hedge real positions.

At both 31 December 2023 and 31 December 2022, all derivatives arranged by subsidiaries of the Group
meet the criteria to be considered hedges.

The main financial risk hedged by the FCC Group through derivative instruments relates to the fluctuations
in floating interest rates to which Group company financing is tied.

At 31 December 2023, the FCC Group has contracted hedging transactions with derivative instruments in
its fully consolidated companies for an aggregate notional amount of 624,395 thousand euros (645,059
thousand euros at 31 December 2022), mainly in the form of interest rate swaps (IRS), where Group
companies buy fixed rates and sell floating rates.

Consolidated Group | Notes to the consolidated financial statements | Page 67 of 139

Additionally, Article 9, Chapter IV of Law 18/2022 of 28 September, on the creation and growth of
companies, introduces the obligation to report the following indicators: monetary volume and number
of invoices paid in a period less than the maximum established in the late-payment regulations and
the percentage that these represent from the total number of invoices and the total monetary value of
payments to suppliers.

Average payment period to suppliers

Ratio of paid operations/transactions

Ratio of operations/transactions pending payment

Total payments pending

Total payments made

Total payments made in a period less than the maximum established
in the late-payment regulations

Ratio (%)

Total number of invoices paid during the period

Number of invoices paid in a period less than the maximum
established in the late-payment regulations

2023

Days

Amount

358,684

Amount

2,589,106

1,053,926

Number

711,135

338,161

2022

Days

Amount

448,829

Amount

2,176,218

815,302

Number

618,224

212,744

Ratio (%)

The Group continues taking the appropriate measures to reduce the average payment period, improving
the payment conditions offered to its suppliers and taking action in relation to internal approval processes
that may delay the payment of amounts due.

Consolidated Group | Notes to the consolidated financial statements | Page 68 of 139

Details of the hedges and their fair value for fully consolidated companies are shown below:

Empresas consolidadas por integración global

FCC Medio Ambiente S.A.U.

RE3 Ltd.

FCC Energy Ltd.

FCC Wrexham PFI Ltd.

FCC Wrexham PFI (Phase II) Ltd.

FCC (E&M) Ltd.

Aquajerez

Gipuzkoa Ingurumena

Qatarat

Aquos El Realito S.A. de C.V

Realia

Total FCC Environment CEE

GMBH

Total full consolidation

Derived type

Hedging type

% hedge

Notional
31.12.23

Notional
31.12.22

Appreciation at
31.12.23

Appreciation at
31.12.22

Due date

IRS

Option

IRS

57%

22%

57%

100%

95%

50%

70%

30%

38%

100%

21%

13%

100%

4,965

3,032

4,965

13,808

8,668

54,156

14,978

5,855

37,722

17,535

13,778

8,031

5,873

1,340

33,953

97,216

58,361

42,836

28,584

19,916

624,395

6,083

3,205

6,083

15,687

8,914

55,680

15,429

6,263

38,449

19,340

15,243

8,493

8,448

2,753

33,576

102,234

61,374

45,047

30,059

7,260

645,059

–

(199)

979

6,104

(643)

238

6,139

6,007

1,259

1,213

645

673

1,036

1,575

946

693

463

(11)

–

(204)

1,450

9,046

(658)

473

469

8,356

8,282

1,905

1,771

974

1,012

(419)

(165)

988

3,423

2,057

1,499

1,008

02/04/2024

30/09/2029

17/06/2038

30/09/2032

06/05/2042

15/07/2031

30/06/2034

07/06/2026

28/11/2024

22/01/2025

27/04/2024

(361)

28,725

29/06/2026

44,869

346

Consolidated Group | Notes to the consolidated financial statements | Page 69 of 139

It also shows the maturities of the notional amount for the hedging operations entered into as at
31 December 2023 and broken down in the previous table:

Companies fully consolidated

366.864

50.427

27.366

16.971

162.767

2024

2025

2026

2027

2028 and
beyond

At 31 December 2023, the total notional amount of hedges of companies consolidated using the equity
method came to 91,425 thousand euros (61,862 thousand euros at 31 December 2022) and their fair
value is 29,408 thousand euros (32,542 thousand euros at 31 December 2022). The impact of speculative
derivatives arranged at companies consolidated under the equity method was not significant either in the
accompanying consolidated income statement or balance sheet in 2023 and 2022.

The following table provides a reconciliation of the change in the valuation of the derivatives, identifying
those amounts that have been recorded in the accompanying consolidated income statement and those
that have been recorded in "Other comprehensive income" of the consolidated statement of recognised
income and expense:

2023

Hedging

2022

Hedging

Balance at
1 January 2023

Profit/(loss) from
valuation of reserves

Profit/(loss) from
valuation of results

Transfers to the
income statement

Inefficiency of the
hedging

Other
changes

Balance at
31 December 2023

44,869

(4,544)

–

(13,216)

–

1,616

28,725

Balance at
1 January 2022

Profit/(loss) from
valuation of reserves

Profit/(loss) from
valuation of results

Transfers to the
income statement

Inefficiency of the
hedging

Other
changes

Balance at
31 December 2022

(21,846)

60,182

–

4,148

–

2,385

44.869

347

23. Tax matters

a) Deferred tax assets and liabilities

This Note describes the headings in the accompanying consolidated income statement relating to the tax
obligations of each of the Group companies, such as deferred tax assets and liabilities, tax receivables and
payables and the corporation tax expense.

In accordance with file 18/89, the Parent Company of the Group is subject to the Corporation Tax
consolidation regime, with all the companies that meet the requirements established by the tax legislation
being integrated into said regime. Likewise, part of the subsidiaries that carry out the Water, Real Estate
(with regard to the Realia subgroup), Environmental Services in the United Kingdom and FCC Environment
Group in Austria, are also taxed in their own consolidated tax group.

In May 2019, the tax authorities completed a procedure to recover state aid, arising from European
Commission Decision 2015/314/EU of 15 October 2014, relating to the tax amortisation of financial
goodwill from the indirect acquisition of foreign holdings. This procedure aims to adjust the tax
incentives applied by the company and Group in prior years as a result of the acquisition of the Alpine,
FCC Environment (formerly the WRG Group) and FCC CEE (formerly the ASA Group) Groups. The Tax
Administration filed a claim against the Group for a total amount (instalment and late payment interest)
equal to 111 million euros. FCC has settled this tax debt but has also filed an economic-administrative
appeal against it, which is pending resolution. The Group, in accordance with the opinion of its legal
advisors, considers it probable that the amounts already paid under such recovery procedure will be
returned. Within the framework of this procedure, the Tax Administration has recognised a negative tax
base generated in previous years in favour of the Group that has generated an activated tax credit for the
amount of 63.2 million euros.

In May 2023, the Tax Administration announced the start of corporate tax inspection activities involving
the tax group headed by Fomento de Construcciones y Contratas, S.A., for 2018 to 2020, as well as VAT
and withholdings/payments on account for employment income and income from professional services
corresponding to the period between April 2019 and December 2020 for Fomento de Construcciones
y Contratas S.A., FCC Construcción, S.A., FCC Medio Ambiente, S.A., FCC Industrial e Infraestructuras
Energéticas, S.A. and Cementos Portland Valderrivas, S.A.

Deferred tax assets mainly relate to provisions recognised, non-deductible financial expenses that will be
deductible for tax purposes from taxable income in future years, tax credits and tax loss carry forwards/
offsets and differences between accounting and tax depreciation and amortisation.

Specifically, the FCC Group has recognised deferred tax assets corresponding to tax loss carryforwards
and deductions pending application, as it considers that there are no doubts as to their recoverability,
amounting to €395,371 thousand (€449,009 thousand at 31 December 2022).

The Group Management has evaluated the recoverability of deferred tax assets by estimating future tax
bases, concluding that there is no doubt surrounding their payment.

The estimates used to assess the recoverability of deferred tax assets are based on the estimate of
future taxable bases, based on the year's consolidated accounting result before the estimated tax from
continuing operations, to which the corresponding permanent and temporary differences that are expected
to take place each year have been adjusted. During the period in which these financial statements were
prepared, specifically on 20 February 2024, the ruling the Constitutional Court declaring Royal Decree-
Law 3/2016 as partially unconstitutional was published in the Official State Gazette. In particular, the
provisions introduced by these to limit the compensation of tax loss carryforwards and to limit the
application of deductions for double taxation, as well as the reversal of portfolio tax impairments that took
place between 2016 and 2020 were considered unconstitutional. As a result, and to the extent that, at the
time of preparing these financial statements, there was no evidence of any law in the pipeline that would
reintroduce these limits, with the Group management considering that, in the coming years, only the limits
to the compensation of tax loss carryforwards indicated in the current regulations will be applicable, and
equivalent to 70% of the tax base prior to compensation. Taking regulatory change into consideration
and based on the profit projections made, it is estimated that the tax group headed by Fomento de
Construcciones y Contratas, S.A. will be able to substantially absorb the negative taxable amounts and
deductions recognised on the balance sheet within an estimated period of 6 years. In relation to the
other assets, it is estimated that they may be recovered substantially over a period of 11 years. In the
hypothetical case that the limits on the compensation of negative tax bases annulled by our constitutional
court were reintroduced, the recoverability period for these tax credits would be extended to 11 years. In
addition, as a result of the foregoing, it has activated an additional tax credit resulting from the negative
taxable amounts of 6.4 million euros.

As a result of the aforementioned ruling of the Constitutional Court, the Realia subgroup has capitalised
a tax credit generated on the tax loss carryforwards for the amount of 15 million euros. Based on the
analysis of the impact on the FCC Aqualia tax group, there have been no changes in the value of the
negative taxable amounts captalised.

The estimated accounting profit for the year for the tax group headed by Fomento de Construcciones y
Contratas, S.A. is based on the planning prepared by the Group for the 2024-2026 period. Turnover growth
of 10.4% in 2024, 1.5% in 2025 and 2.9% in 2026 is assumed. In turn, the projected Ebitda margin is 11%
for 2024 and 12% for 2025 and 2026. During subsequent periods, vegetative growth is projected at the
level of pre-tax profit equal to 2%. For the tax group headed by FCC Aqualia, S.A., a vegetative growth of
2% has been applied to the profit before tax for 2023. In the case of the tax group headed by Realia, the
taxable income is estimated on the basis of the projected accounting profit up to 2038 adjusted by those
temporary and permanent differences that are expected to reverse in each year.

348

The deferred tax liabilities recognised by the Group mainly arise from the following:

• The differences between the tax and accounting valuation due to the fair value of assets derived from
the corporate acquisitions in the different segments of the Group's activity and investment property,
as indicated in notes 3.b) and 3.e). In general, these liabilities will not entail any future cash outflows
because they revert at the same rate as the amortisation of revalued assets.

• From the tax amortisation of leasing contracts and that of certain items of property, plant and

equipment under accelerated tax amortisation plans, and from the unrestricted amortisation on the
investments made, which allows them to be fully amortised as long as certain requirements are fulfilled.

• From the profits of temporary joint ventures that will be included in the tax base of the following year's

corporate income tax.

The Group, pursuant to the provisions of IAS 12 "Corporation Tax", has offset the deferred tax assets and
liabilities corresponding to the entities, which, in line with the applicable tax legislation, have the legal right
to offset these assets and liabilities and will be settled for their net amount based on the corresponding
time frames. At 31 December 2023, deferred tax assets and liabilities were offset in the amount of 299,198
thousand euros (297,428 thousand euros at 31 December 2022).

The following table shows the breakdown of the main deferred tax assets and liabilities prior to offset:

2023

2022

ASSETS

Provisions and impairments

Tax loss carryforwards and deductions

Non-deductible financial expense

Pension plans

Amortisation/depreciation differences

Other

Total

LIABILITIES

Fair value assets from allocation of acquisition differences
(IFRS 3)

Investment property at fair value (IAS 40)

Accelerated amortisation/depreciation

Profit/(loss) of Joint Ventures

Finance leases

Other

Total

Tax Group
Spain

Realia
Tax Group

93,900

307,392

6,422

677

10,551

121,077

11,046

71,857

25,731

–

237

648

Other

47,741

15,923

8,325

1,496

15,326

28,996

540,019

109,519

117,807

Tax Group
Spain

Realia
Tax Group

51,820

7,362

61,366

7,293

13,835

3,013

27,148

170,820

4,419

–

2,684

2023

Other

73,893

128,559

5,293

2,436

23,358

TOTAL

152,687

395,172

40,478

2,173

26,114

150,721

767,345

TOTAL

133,075

232,264

140,271

19,128

5,449

53,190

Tax Group
Spain

Realia
Tax Group

102,049

360,343

6,844

746

10,164

104,194

584,340

5,859

65,682

26,746

–

474

564

Other

44,997

22,984

–

1,025

12,263

32,034

99,325

113,303

2022

Tax Group
Spain

Realia
Tax Group

52,263

8,017

63,339

1,636

15,004

4,288

30,293

172,210

4,408

–

5,066

Other

84,217

–

115,678

2,251

2,371

18,364

164,475

185,285

233,617

583,377

166,823

189,701

222,881

579,405

349

TOTAL

152,905

449,009

33,590

1,771

22,901

136,792

796,968

TOTAL

144,497

235,549

121,722

17,255

6,659

53,723

Below is the expected enforcement schedule for deferred taxes:

b) Public administrations

350

2024

2025

2026

2027

Assets

Liabilities

115,731

68,516

90,052

36,986

93,751

36,986

172,737

36,986

2028 and
beyond

295,074

403,903

Total

767,345

583,377

The breakdown at 31 December 2023 and 2022 of the current assets and liabilities included under the
“Public administrations” heading is as follows:

Current assets

The Group has tax credits corresponding to negative tax bases (NTBs), mainly abroad, which have not
been activated in the financial statements on the basis of a prudent criterion, for the amount of 191,2
million euros. The estimated maturity of non-activated NTBs is shown below:

Value Added Tax receivable (Note 15)

Current tax

Other tax items (Note 15)

Maturity time frame

From 2024 to 2028

From 2029 to 2033

From 2034 onwards

No maturity

Tax credits
(millions of euros)

38.3

6.9

16.5

129.5

191.2

Meanwhile, the Group has non-activated tax credits corresponding to tax deductions that have been
accredited and are pending application for a total amount of 8.9 million euros.

Current liabilities

Value Added Tax payable (Note 21)

Current tax (note 21)

Social Security payable and other tax items (note 21)

Deferrals

2023

143,260

84,449

79,683

307,392

2023

92,088

39,254

222,720

2022

103,972

86,518

63,762

254,252

2022

118,431

23,610

234,941

354,101

377,066

351

Consolidated Group | Notes to the consolidated financial statements | Page 74 of 139

c) Corporate income tax expense

The corporation tax expense incurred in the year amounted to 171,120 thousand euros (72.723
thousand euros in 2022), as detailed in the accompanying consolidated income statement. Below is the
reconciliation between accounting profit and accrued tax payment:

Consolidated accounting profit for the year
before taxes from continuing activities

Permanent differences

Adjusted consolidated accounting profit on continuing activities

Temporary differences

- Arising in the year

- Arising in prior years

Consolidated tax base of continuing activities (taxable profit)

2023

2022

Additions

49,367

Reductions

(220,048)

255,326

198,123

(145,598)

(394,422)

915.930

(170,681)

745,249

109,728

(196,299)

658,678

Additions

255,457

Reductions

(151,663)

106,830

120,882

(135,235)

(306,627)

550.653

103,794

654,447

(28,405)

(185,745)

440,297

From the previous table, given the magnitude of the amounts, it should be noted that the tax base is the
best estimate available at the date of preparing the accounts. The final amount payable will be determined
in the tax settlement to be carried out in 2024, so the final settlement may vary as explained in note 3.q) of
these notes to the consolidated financial statements.

In 2023, permanent differences include, in relation to decreases, the sum of 142,413 thousand euros for
the profit resulting from consolidating Metrovacesa using the equity method having achieved significant
influence over the company (notes 4, 11, 13, 17 and 26), as well as the profit turned by companies
consolidated under the equity method for the sum of 31,616 thousand euros. In addition, worth particular
mention in terms of the reductions in temporary differences is the compensation of negative taxable
amounts capitalised in previous years for the sum of 284,356 thousand euros.

In 2022, permanent differences, as increases, included the amount of the impairment recorded in
Corporación Uniland goodwill (note 6) amounting to 196,288 thousand euros. Decreases include the profit
of companies consolidated using the equity method for the sum of €29,614 thousand, the compensation
of tax loss carry forwards and non-deductible financial expenses from previous years not recognised
on the balance sheet for the sum of €72,579 thousand. Also worth noting in relation to the decreases

of temporary differences is the compensation of non-deductible non-financial expenses capitalised in
previous years for the amount of €129,840 thousands and the change in fair value of investment property
and their tax amortisation for a total sum of €44,970 thousand (notes 8 and 26).

Below is the reconciliation of the expense for corporation tax:

Adjusted consolidated accounting profit on continuing activities

Corporate income tax

Tax credits and tax relief

Adjustments for tax rate change

Other adjustments

Corporate income tax

2023

745,249

(168,731)

5,431

(3,173)

(4,647)

(171,120)

2022

654,447

(145,967)

4,683

68,508

(72,723)

Consolidated Group | Notes to the consolidated financial statements | Page 75 of 139

Other adjustments in 2023 include income of 21,427 thousand euros generated on the capitalisation of
additional negative taxable amounts in the Group as a result of the Constitutional Court ruling cited in
section a) of this note.

The value of Other adjustments in 2022 mainly included the capitalisation of deferred tax assets for the
large part in relation to uncapitalised tax credits for tax bases pending compensation and for deductions
pending application for the value of 89,609 thousand euros, which had not previously been recognised
and which, this year, were recognised on the balance sheet after determining, as discussed in previous
sections, that there are no doubts as to their recovery.

The main components of the corporate income tax, distinguishing between the current tax, i.e, tax
corresponding to the current year and the deferred tax, the latter understood as the impact on profit/(loss)
of the origination or reversal of temporary differences that affect the amount of deferred tax assets or
liabilities recognised in the balance sheet, is as follows:

Current tax

Deferred taxes

Corporate income tax

2023

(172,399)

1,279

(171,120)

2022

(65,756)

(6,967)

(72,723)

In turn, the OECD has pursued a project to establish a complementary tax to guarantee a global minimum
level of taxation for multinational groups (the so-called “Pillar II” project). Pillar 2 regulations have been
enacted, or substantially enacted, in specific jurisdictions in which the Group operates. The legislation
will apply to the Group starting on 1 January 2024. The Group is in the process of assessing the potential
exposure arising from the Pillar 2 legislation.

The assessment of potential exposure to Pillar 2 taxes is based on the most recent tax returns, country-by-
country reports and the financial statements of Group companies.

Based on the assessments performed to date, the Group has identified potential exposure to Pillar 2 taxes
on profits in the United Arab Emirates, Ireland, Georgia and Serbia, where the expected effective Pillar 2
tax rate is likely to be lower than 15%. The potential exposure would correspond to companies, mainly
operating subsidiaries, in these jurisdictions where the Pillar 2 effective tax rate is less than 15%. However,
there may also be an exposure in other jurisdictions where assessments are ongoing.

At present, there is no known quantitative information indicating potential exposure to Pillar 2 taxes. However,
the total profit attributable to jurisdictions in which a supplementary tax liability may exist does not currently
represent more than 2% of the Group's total profit. As a result, we believe that the implementation of the
regulations resulting from the Pillar II project would not have a material effect on the Group's future taxation.

352

24. Pension plans and similar obligations

The Spanish Group companies have not generally established any pension plans to supplement the social
security pension plans. However, under the Consolidated Pension Plans and Pension Funds Law, in those
specific cases in which similar obligations exist, the companies externalise pension and similar obligations
to its employees.

In accordance with article 38.5 of the Bylaws, Fomento de Construcciones y Contratas, S.A. holds a civil
liability insurance that covers Directors and Managers. This is a collective policy covering all the Group’s
executives, and in 2023 a premium of €1,284 thousand was paid over (€1,483 thousand in 2022).

Fomento de Construcciones y Contratas, S.A. has taken out an accident insurance policy for its directors,
encompassing both the exercise of their functions and their private life, comprising coverage in the event
of death, total and absolute permanent incapacity and severe disability. The premium paid in the year
amounts to 5 thousand euros (5 thousand euros in 2022).

Certain foreign companies belonging to the Group assumed the commitment of supplementing the
retirement and other similar commitments of its employees through defined benefit plans. Independent
actuarial experts measured the commitments accrued and, where appropriate, the assets used, through
generally accepted actuarial methods and techniques included, where appropriate, in the accompanying
consolidated balance sheet under the “Non-current provisions” heading within “Non-current employee
benefit obligations”, in line with the criteria set forth by IFRSs (Note 18).

The main benefits referred to in the preceding paragraph are the following:

• The companies that form part of the FCC Environment (UK) Group, residing in the United Kingdom,
contribute to the accompanying consolidated balance sheet at 31 December 2023 the benefits
undertaken with their employees, after deducting the assets used to meet these benefits. The actuarial
value of the accrued obligations comes to €42,373 thousand (€40,876 thousand at 31 December 2022),
while the fair value of the affected assets stands at 44,261 thousand euros (45,678 thousand euros at
31 December 2022). The net difference represents an asset balance of €1,888 thousand euros (€4,802
thousand euros at 31 December 2022), which is not recognised in the accompanying consolidated
balance sheet as the company is not entitled to repayments or reductions in future contributions.
“Personnel expenses” in the accompanying consolidated income statement includes a cost of 83
thousand euros (336 thousand euros at 31 December 2022) for the net difference between the cost of
services and the return on plan assets. The average actuarial rate used was 4.75% (4.95% in 2022).

353

The year's movement of the obligations and assets associated with pension plans and similar obligations
is detailed below:

Actual performance of the fair value of affected assets

FCC Environment Group (UK)

2023:

Actual performance of the current value of the obligation

Balances of obligations at the beginning of the year

Cost of services for the current year

Interest costs

Contributions of the participants

Actuarial profits/losses

Exchange differences

Benefits paid during the year

Cost of past services

Settlements

Balance obligations at end of year

Affected active balances at the beginning of the year

Expected return on assets

FCC Environment Group (UK)

Actuarial profits/losses

Exchange differences

Contributions made by the employer

Contributions made by the participant

Benefits paid

Settlements

Balance of affected assets at the end of the year

40,876

112

2,019

350

841

(1,845)

–

42,373

45,678

2,323

(5,314)

940

2,568

(1,954)

–

44,261

Reconciliation of the actual performance of the obligation less the affected assets

Net balance obligations less affected assets at the end of the year

(1,888)

FCC Environment Group (UK)

2022:

Actual performance of the current value of the obligation

Balances of obligations at the beginning of the year

Cost of services for the current year

Interest costs

Contributions of the participants

Actuarial profits/losses

Exchange differences

Benefits paid during the year

Cost of past services

Settlements

Balance obligations at end of year

FCC Environment Group (UK)

70,353

221

1,183

(25,343)

(3,701)

(1,855)

–

40,876

Consolidated Group | Notes to the consolidated financial statements | Page 77 of 139

Actual performance of the fair value of affected assets

Affected active balances at the beginning of the year

Expected return on assets

Actuarial profits/losses

Exchange differences

Contributions made by the employer

Contributions made by the participant

Benefits paid

Settlements

Balance of affected assets at the end of the year

FCC Environment Group (UK)

73,815

1,221

(25,976)

(3,883)

2,491

(2,008)

–

45,678

Reconciliation of the actual performance of the obligation less the affected assets

Net balance obligations less affected assets at the end of the year

(4,802)

FCC Environment Group (UK)

25. Guarantee commitments to third parties
and other contingent liabilities

At 31 December 2023, the Group incurred contingent liabilities, mainly guarantees to third parties, mostly
before public bodies and private clients, to secure the correct performance of the urban sanitation works
and contracts, for 5,041,504 thousand euros (4,697,135 thousand euros at 31 December 2022).

Additionally, the Group has granted letters of indemnity to certain directors with management and
administration duties at subsidiaries, without the any risks for which provisions should be set aside
identified during the preparation of these financial statements. Such letters of indemnity are a common
practice in multinational companies that expatriate employees due to their double status as company
employees and executives of the subsidiary, and are of subsidiary execution in the event that the respective
directors' policies do not fully cover the contingency. Letters of indemnity were granted to five executives in
relation to the businesses that were maintained by the Group in Alpine.

354

Fomento de Construcciones y Contratas, S.A. and the Group's subsidiaries are defendants in litigation
concerning liability for different activities carried out by the Group in the performance of contracts
awarded and for which provisions have been set aside (Note 18). These lawsuits, which in number may be
significant, are for insignificant amounts when considered on a one-by-one basis. Therefore, give proven
experience and existing provisions, the resulting liabilities would not significantly affect the Group's assets.

In relation to the main contingent liabilities arising from the Alpine subgroup's bankruptcy proceedings, it
should be noted that the possible financial effects would be the cash outflow of the amount indicated in
the respective lawsuits detailed in note 18 of these notes to the consolidated financial statements, plus
interest and costs, if any.

On 15 January 2015, the Competition Chamber of the National Markets and Competition Commission
issued a decision on file S/0429/12, for an alleged violation of Article 1 of Law 15/2007 on the Defence
of Competition. The aforementioned resolution affects several companies and associations in the waste
sector, including companies belonging to the Group. The Group has filed an administrative appeal before
the Spanish National Appellate Court. At the end of January 2018, the Judgments issued by the National
Court were notified, upholding the contentious-administrative appeals filed by Gestión y Valorización
Integral del Centro, S.L. and Betearte, S.A. Unipersonal, both companies owned by FCC Servicios
Medioambiente Holding, S.A. Unipersonal, against the CNMC's ruling imposing several sanctions for
alleged collusive practices. In both decisions, the argument put forward by these companies that no single,
on-going breach existed was upheld. In April 2018, we were notified of the agreement initiating new legal
proceedings for the same conduct investigated in the previous proceedings forming the scope of the
upholding decision, commencing an 18-month examining period. In September 2019, an agreement was
issued suspending the processing of the sanctioning file until the National Court ruled on the appeals
presented by other sanctioned companies. On 22 March 2023, a ruling was handed down by the CNMC's
Competition Chamber agreeing to archive the disciplinary case. The Chamber ruled that it was no longer
appropriate to continue with the proceedings and that the case should be archived, for the purposes of all
parties.

In 2019, as a result of an internal investigation in May in application of its compliance policy and
regulations, the Group became aware of the existence of payments between 2010 and 2014, initially
estimated at 82 million dollars, which might not be justified and, may, therefore be illegal. These acts were
uncovered as a result of application of the procedures in the Group's compliance rules. The company
has informed prosecutors in Spain and Panama about these acts, and has been providing the utmost
cooperation since then to clarify what happened, applying the "zero tolerance" principle for corruption that
permeates the entire FCC Compliance System.

355

Additionally, the 2018 agreement for the sale of the 49% FCC Aqualia holding envisages certain variable
prices that depend on the resolution of contingent proceedings. The Group, therefore, has not recognised
any asset given its contingent nature; likewise, it has not recognised any liability for claims that may arise
against its interests, as it is not considered probable that significant losses will be incurred and given that
their value is considered insignificant in relation to the transaction price.

Also, as part of the aforementioned sales transaction, FCC Topco s.a.r.l. and its subsidiary FCC Midco, S.A.
were constituted, contributing shares representing 10% of the Group's shares in FCC Aqualia to the latter.
These shares have been pledged as a guarantee of certain obligations assumed by the Group before FCC
Aqualia, mainly in relation to the repayment of the loan that the latter has granted to the parent company
of the Group for the amount of 806,479 thousand euros at 31 December 2023. At the date of authorisation
for issue of these financial statements, the Group believes that there is no risk that these guarantees will
be enforced.

The Group is involved in other lawsuits and legal procedures aside from those already described that it
considers will not generate significant cash outflows.

The shareholding of Group companies in jointly controlled operations managed through joint ventures,
joint ownership, participation accounts and other entities of similar legal characteristics means that
participants must share joint and several liability with respect to the activity carried on (note 12).

In relation to the guarantees received, it should be noted, in general, that the Group only receives
guarantees in relation to amounts paid as advances for the purchase of highly specialised equipment
that has been ordered, mainly in the Construction and Water segments, for a non-significant amount as
a whole. The Group has not obtained any significant assets as a result of the guarantees enforced in its
favour or released.

Consolidated Group | Notes to the consolidated financial statements | Page 78 of 139

In the context of this collaboration and following the voluntary declaration made by the Group, on 29
October 2019, the Central Court of Instruction No. 2 of the National Court issued an Order in which it
is stated that “based on the documentation corresponding to the proceedings, as stated by the Public
Prosecutor's Office, and as reported in the second plea of fact of this resolution, there appear to be
rational indications of the participation of FCC Construcción, S.A., FCC Construcción América, S.A. and
Construcciones Hospitalarias, S.A. in the alleged facts that, notwithstanding their classification at the
corresponding time, could constitute offences of corruption in international transactions, provided for and
punished under Art. 286 ter of the Criminal Code and money laundering, provided for and punished under
Art. 301 and 302.2 of the Criminal Code” agreeing for FCC Construcción, S.A. to be investigated as part of
Preliminary Proceedings 34/2017 as well as two of its subsidiaries, FCC Construcción América, S.A. and
Construcciones Hospitalarias, S.A.

The case is still in the investigation period, without us being able to determine at this time what type of
charges could be filed, if any. It should be noted that during 2023, the UCO (Central Operational Unit of the
Civil Guard) issued a report, referred to in various press articles, in which other amounts differing from than
those reported by Fomento de Construcciones y Contratas, S.A. are mentioned, although it must be noted
that these reports refer to behaviours conduct and sums of money that cannot all be attributed to the
Group. These actions may therefore have a financial impact on these companies, although we do not have
the information needed to qualify this impact.

On 6 July 2022, the National Markets and Competition Commission issued a resolution imposing a
sanction on several construction companies, including FCC Construcción, S.A. for sharing the costs of
technical work to verify objective data in relation to public works tenders. The Group considers that the
sanctioned conduct not only fails to infringe any precept (including those contained in the competition
law) but that this conduct has also contributed to greater efficiency and cost savings in tenders. For
these and other reasons, it filed the corresponding contentious-administrative appeal before the National
Court, which is still being heard. Furthermore, it asked said court to grant a precautionary measure for the
suspension of the payment of the fine imposed by the CNMC until a final court ruling is handed down on
this matter. This request was upheld. Therefore, it has been considered that, although this sanction may
result in cash outflows, at present and given the situation we cannot estimate the corresponding amount
and payment schedule.

The sale of the 24.99% holding in FCC Servicios Medio Ambiente Holding, S.A. to the Canadian pension
fund, CPP Investments (note 4), includes a contingent price clause in relation to the cash flows generated
by certain assets included in the scope of the sale. Given that the value of collections or payments cannot
be determined with sufficient reliability, the limited value of the estimated possible collections or payments
and given the uncertainty of the time at which they may occur, the Group has not recognised any assets or
liabilities. In addition, it is estimated that the net value of these collections or payments will not be relevant
as its amount could not be determined reliably (note 4).

356

26. Income and expenditure

a) Operating income

At year-end 2023, based on outstanding contracts, the Group estimated that it had outstanding
performance obligations primarily for services rendered in the Environmental and Water Services segment
and arising from construction agreements mainly in the Construction and Water segments amounting to
41,484,908 thousand euros (40,154,255 thousand euros at year-end 2022) which it expects to recognise as
revenue in accordance with the following schedule:

The Group records operating income under "Revenue", including interest income from the concession
financial model collection rights under IFRIC 12 amounting to €58,006 thousand at 31 December 2023
(31 December 2022: €37,754 thousand), except for work on own property, plant and equipment and other
operating income.

Note 27 "Information by activity segments" shows the contribution of the business segments to
consolidated Revenue.

up to 1 year

2 to 5 years

beyond 5 years

Total

Environmental Services

Construction

Integrated Water Management

1,957,078

2,549,586

1,682,438

4,868,745

3,876,291

6,502,534

13,328,357

–

6,425,877

7,640,454

12,407,782

21,730,674

6,189,102

16,385,490

18,910,316

41,484,908

Operating income of €20,948 thousand (at 31 December 2022: €29,130 thousand), mainly in the
Construction and Environmental Services segments, has been recognised in 2023 from performance
obligations satisfied or partially satisfied in prior years.

b) Supplies

During 2023, 324,598 thousand euros (297,202 thousand euros at 31 December 2022) previously
recognised as customer advances and pre-certified work (notes 15 and 21), which were recognised as
revenue under "Trade and other payables", mainly in the Construction segment, have been recognised
under liabilities.

The breakdown of the other operating income for 2023 and 2022 is as follows:

Income from sundry services

CO2 emission rights (Note 26)

Reimbursement from insurance compensation

Grants related to income

Other income

2023

2022

113,944

107,554

–

4,441

43,590

95,580

257,555

–

2,796

38,449

139,681

288,480

"Income from sundry services" mainly includes additional services derived from construction contracts or
provision of services not included in the main contracts and income derived from the provision of technical
assistance to entities accounted for using the equity method. "Other income" mainly includes excess
provisions and rental income when the Group acts as lessor in operating leases in activities other than real
estate.

The breakdown of the balance of supplies and other external expenses as at 31 December 2023 and 2022
is as follows:

Subcontracting and work performed by other companies

Purchases and procurements

c) Staff costs

Below is a breakdown of staff expenses for 2023 and 2022:

Wages and salaries

Social security contributions

Other staff costs

2023

2022

2,105,999

1,594,001

1,541,727

1,462,610

3,700,000

3,004,337

2023

2022

1,875,219

1,687,937

535,479

63,751

491,304

59,492

2,474,449

2,238,733

Consolidated Group | Notes to the consolidated financial statements | Page 80 of 139

357

Below, the average number of employees and their distribution by functional level and gender in 2023 and
2022 was as follows:

d) Impairment and gains/(losses) on disposal of fixed assets

Governance and Management

Supervisors

Technical staff

Administrative staff

Sundry trades

Men

Women

2023

509

4,674

6,722

2,946

51,541

66,392

2023

51,491

14,901

66,392

2022

510

4,299

6,640

3,051

48,730

63,230

2022

48,978

14,252

63,230

The number of employees and their distribution by functional level and gender at 31 December 2023 and
2022 was as follows:

Governance and Management

Supervisors

Technical staff

Administrative staff

Sundry trades

Men

Women

2023

507

4,812

7,055

2,981

51,735

67,090

2023

52,016

15,074

67,090

2022

526

4,432

6,813

2,959

50,069

64,799

2022

50,087

14,712

64,799

The breakdown of the balance of the Impairment and gains/(losses) on disposal of fixed assets in the
years 2023 and 2022 is as follows:

Impairment of the commercial fund (note 6)

Changes in fair value of investment property (note 8)

Result of takeover of Sociedad Concesionaria Tranvía de Murcia, S.A.
(Note 4)

2023

–

(49,037)

–

2022

(200,000)

22,294

5,544

Depreciation and amortisation of other property, plant and equipment
and intangible assets (endowment) / reversal (notes 6 and 7)

2,906

(8,515)

Profit/(loss) from disposals of other tangible and intangible assets

Other concepts

(982)

129

4,527

1,255

(46,984)

(174,895)

Worth particular note in 2023 were the losses recorded due to the change in the fair value of investment
property amounting to minus 49,037 thousand euros as a result of the assessment carried out by
independent experts of the investment property (note 8) pertaining to the Realia Group (24,139 thousand
euros) and Jezzine Uno, S.L.U. (24,898 thousand euros).

The following results are to be highlighted for 2022:

• as a result of the takeover of Sociedad Concesionaria Tranvía de Murcia, S.A. following the acquisition
in November 2022 of an additional 50% stake by FCC Construcción S.A., operating profit of €5,544
thousand was recognised as the consideration paid was lower than the fair value of the assets acquired
(note 4).

• the impairment of goodwill in the Cement activity for the sum of €200.000 thousand (note 6).

• gains due to the change in the fair value of investment property amounting to 22,294 thousand euros
as a result of the assessment carried out by independent experts of the investment property (note 8)
pertaining to the Realia Group for the sum of 11,559 thousand euros and Jezzine Uno, S.L.U. for the sum
of 10,735 thousand euros.

The amount of this item is included in the accompanying consolidated cash flow statement under
"Impairment and gains/(losses) on disposal of fixed assets" in the consolidated statement of cash flows.

Consolidated Group | Notes to the consolidated financial statements | Page 81 of 139

e) Other gains/(losses)

The breakdown of financial expenses in 2023 and 2022 is as follows:

In 2023, worth particular mention were the gains of 24,824 thousand euros as a result of a final ruling
in relation to the expropriation of land previously owned by Cementos Portland Valderrivas, S.A. in the
province of Madrid.

f) Financial income and financial expenses

The breakdown of the financial income, according to the assets that generate said income, in 2023 and
2022 is as follows:

Debt instruments and other marketable securities

Credits and loans

Debts with limited recourse for project financing

Creditors from leases

Financial update of provisions and other liabilities

Other financial expenses

358

2023

50,571

104,611

16,131

13,303

27,944

13,264

2022

52,345

44,557

11,030

12,315

32,174

11,818

225,824

164,240

Financial assets at fair value with changes in other comprehensive
income

Financial assets at amortised cost

Other financial income

2023

7,565

58,185

10,102

75,852

2022

3,422

24,923

16,803

45,148

In 2023, the increase in the amount recorded under “Financial assets at amortised cost” was mainly
due to financial income from treasury surpluses placed in deposits or current accounts remunerated at
rates higher than those in the previous year, mainly in the international activity of the Construction and
Environmental Services segments.

The increase in financial expenses in 2023 can mainly be traced to the general increase in the interest rates
applied to the Group's financial debt, with the amount contributed by the Integrated Water Management
activity segment worth particular mention (note 19).

g) Other financial profit/(loss)

The breakdown of other financial expenses in 2023 and 2022 is as follows:

Change in fair value of current financial instruments

Exchange differences

Impairment and profits/losses on disposal of financial Instruments

2023

(119)

(20,898)

2,640

(18,377)

2022

4,946

26,060

(1,401)

29,605

In 2022, "Change in fair value of current financial instruments" included a gain of 2,441 thousand euros
from the contingent collection arising from the sale of 49% of FCC Aqualia, S.A. in 2022 without loss of
control (note 25).

In 2023, negative exchange differences amounting to 20,898 thousand euros were recorded (26,060
thousand euros of positive exchange differences in 2022), which mainly correspond in 2023 to the
appreciation of the Mexican peso and the depreciation of the US dollar (appreciation in 2022).

The amount of this heading is shown in the accompanying consolidated statement of cash flows under
the heading "Other adjustments of profit/(loss) (net)".

Consolidated Group | Notes to the consolidated financial statements | Page 82 of 139

359

h) Profit/(loss) of entities valued using the equity method

i) Profit attributable to non-controlling interests

The breakdown for this heading is as follows:

The breakdown of this heading by activity segments was as follows (note 27):

Profits/(losses) for the year (Note 11)

14,419

32,123

Environmental Services

2023

2022

Integrated Water Management

Construction

Cement

Real Estate

Concessions

Total Group

Joint ventures

Associates

Profit/(loss) on disposals and other

20,266

(5,847)

31,132

991

159,609

174,028

(2,509)

29,614

During 2023, "Gains/losses on disposals and other" included those from the following transactions:

• since December 2023, following the acquisition of an additional 3.99% holding from Control Empresarial
de Capitales, S.A. de C.V., and 1.95% from Soinmob Inmobiliaria Española, S.A.U. taking its total holding
to 21.21%, Metrovacesa, S.A., which had previously been accounted for at fair value charged to reserves,
is now consolidated using the equity method having achieved significant influence. This transaction
resulted in the recognition of profit of 142,413 thousand euros given the difference between the fair
value of their net assets and the quoted price of the investment before its inclusion in the scope of
consolidation (notes 4, 11, 13, 17 and 30).

• divestment of holding in Constructora Nuevo Necaxa Tihuatlán, S.A. de C.V. generating a pre-tax profit
of 17,197 thousand euros, including 4,952 thousand euros recognised in profit or loss of the valuation
adjustments contributed by said company.

In 2022, "Gains/losses on disposals and other" included the losses from the recognition at fair value of the
Group's holding before its takeover of Sociedad Concesionaria Tranvía de Murcia, S.A., for the sum of 2,772
thousand euros (note 4).

2023

37,163

72,811

329

2,748

40,192

579

2022

26,177

87,349

1,252

(1,002)

48,450

522

153,822

162,748

The increase in the value of the Environmental Services segment is mainly due to the fact that in October
2023, the sale of 24.99% of the Environmental Services subsidiary, FCC Servicios Medio Ambiente Holding,
S.A., to Canadian pension fund CPP Investments was completed (notes 4 and 17).

Consolidated Group | Notes to the consolidated financial statements | Page 83 of 139

360

27. Information by activity segments

Income statement by segments

a) Activity segments

The activity segments presented coincide with the business Areas, as described in Note 1. The information
for each segment, reflected in the tables presented below, has been prepared in line with the management
criteria established internally by the Group's management, which are consistent with the accounting
policies adopted to prepare and present the Group's consolidated financial statements.

The "Corporation" column includes the activity of the functional areas that carry out support tasks for
operations and the operation of those companies whose management is not assigned to any of the
business Areas.

"Eliminations" includes the elimination of operations between different activity segments.

In particular, the information reflected in the following tables includes, as profit/(loss) for 2023 and 2022:

• All operating income and expenses of subsidiaries and joint management contracts that correspond to

the activities carried out by the segment.

• Interest income and expenses generated on the segment's assets and liabilities, dividends and profits

and losses on the sale of the segment's financial investments.

• The share in the profits/(loss) of companies accounted for using the equity method.

• Corporate income tax payable corresponding to the transactions carried out by each segment.

361

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

2023

Revenue

External customers

From transactions with other segments

Other income

External customers

From transactions with other segments

9,026,016

–

345,224

–

3,853,241

3,847,766

5,475

131,441

130,370

1,071

1,487,402

1,485,619

1,783

84,745

83,057

1,688

2,823,090

2,766,413

56,677

88,500

89,016

(516)

Operating expenses

(7,841,614)

(3,338,000)

(1,187,872)

(2,742,167)

Depreciation of fixed and non-current assets and
allocation of grants for non-financial fixed and
non-current assets, and other assets

(587,377)

(302,321)

(165,439)

(51,272)

Other operating income/(losses)

(31,998)

(6,752)

(2,510)

266

24,156

910,251

337,609

216,326

118,417

129,065

Operating profit/(loss)

Percentage of revenue

Financial income

Financial expenses

Other financial profit/(loss)

Profit/(loss) of companies accounted for using the
equity method

10.08%

75,852

(225,824)

(18,377)

174,028

8.76%

28,458

(90,981)

(441)

22,289

14.54%

39,517

(91,394)

6,206

1,584

4.19%

25,001

(2,737)

(22,746)

9,274

614,313

603,928

10,385

10,052

10,034

(484,854)

(34,602)

21.01%

3,655

(8,446)

(929)

253,780

252,902

878

22,389

22,049

340

(171,240)

(194)

(48,929)

55,806

21.99%

2,052

(28,541)

–

(12,536)

144,160

61,592

–

8,609

8,608

(24,546)

(15,161)

64,544

95,038

154.30%

3,968

(9,839)

171

6,980

68,711

7,796

60,915

47,149

2,090

45,059

(78,296)

(18,960)

(136,113)

–

(136,113)

(47,661)

–

(47,661)

185,361

572

(62,805)

18,636

(60,646)

27.12%

39,798

(43,851)

44.56%

(66,597)

49,965

1,150,787

(1,151,425)

2,125

152

Profit/(loss) before tax from continuing operations

915,930

296,934

172,239

127,209

110,809

173,477

96,318

1,167,495

(1,228,551)

Corporate income tax

(171,120)

(73,133)

(45,261)

(19,465)

(20,413)

4,303

(12,281)

(15,951)

11,081

Profit/(loss) for the year from continuing
operations

744,810

223,801

126,978

107,744

90,396

177,780

84,037

1,151,544

(1,217,470)

Consolidated profit/(loss) for the year

744,810

223,801

126,978

107,744

Non-controlling interests

153,822

37,163

Profit attributable to the Parent Company

590,988

186,638

72,811

54,167

329

107,415

90,396

2,748

87,648

177,780

84,037

1,151,544

(1,217,470)

40,192

579

–

137,588

83,458

1,151,544

(1,217,470)

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

362

Operating expenses

(6,756,953)

(3,146,835)

(1,074,312)

(1,958,480)

(511,989)

(267,370)

(145,970)

(36,068)

Consolidated Group | Notes to the consolidated financial statements | Page 85 of 139

2022

Revenue

External customers

From transactions with other segments

Other income

External customers

From transactions with other segments

Total Group

7,705,687

–

362,617

–

Depreciation of fixed and non-current assets and
allocation of grants for non-financial fixed and
non-current assets, and other assets

Other operating income/(losses)

Operating profit/(loss)

Percentage of revenue

Financial income

Financial expenses

Other financial profit/(loss)

Profit/(loss) of companies accounted for using the
equity method

(188,836)

610,526

7.92%

45,148

(164,240)

29,605

29,614

Profit/(loss) before tax from continuing operations

550,653

Corporate income tax

(72,723)

3,641,113

3,634,489

6,624

98,790

97,243

1,547

1,323,155

1,322,456

699

101,377

100,128

1,249

1,966,913

1,916,351

50,562

114,347

112,115

2,232

(20,969)

304,729

8.37%

15,739

(81,259)

(1,664)

27,986

265,531

(56,102)

(442)

203,808

15.40%

39,447

(59,223)

5,206

2,575

191,813

(35,525)

2,641

89,353

4.54%

9,542

(2,799)

20,586

(158)

116,524

(25,029)

516,522

512,138

4,384

7,206

7,155

(493,424)

(33,551)

(200,026)

(203,273)

(39.35%)

584

(3,941)

(233)

(9,787)

(216,650)

20,911

270,752

270,199

553

24,466

24,314

152

(152,599)

(328)

23,391

165,682

61.19%

2,734

(20,378)

3,943

2,570

154,551

(27,473)

41,021

–

12,959

–

(22,914)

(10,098)

6,574

27,542

67.14%

5,698

(4,208)

(490)

5,063

33,605

(3,732)

29,873

522

29,351

67,937

9,033

58,904

49,300

8,703

40,597

(77,139)

(18,789)

(2)

21,307

31.36%

29,635

(37,116)

(75,694)

1,286

(60,582)

54,311

(6,271)

–

(121,726)

–

(121,726)

(45,828)

–

(45,828)

168,750

185

(3)

1,378

(1.13%)

(58,231)

44,684

77,951

65,861

(84)

65,777

–

(6,271)

65,777

Profit/(loss) for the year from continuing
operations

Consolidated profit/(loss) for the year

Non-controlling interests

Profit attributable to the Parent Company

477,930

209,429

156,288

91,495

(195,739)

127,078

477,930

162,748

315,182

209,429

26,177

183,252

156,288

87,349

68,939

91,495

1,252

90,243

(195,739)

127,078

(1,002)

(194,737)

48,450

78,628

The contribution of the "Corporation" segment to the results of the FCC Group mainly includes the billing
of the support services provided to the rest of the Group's activities under "Revenue", the impairment
of the investments on the parent companies' shares from the other segments, as well as dividends
distributed by Group companies that are subsidiaries of the Group's parent company, the financial
expenses billed by other group companies as a result of intra-group loans granted to the parent company

by other subsidiaries and the financial income billed to other group companies as a result of intra-group
loans granted by the parent company to other subsidiaries. All these concepts, as transactions with Group
companies, are eliminated as shown under "Eliminations". Also included are the financial expenses for
debts with credit institutions detailed in note 19.

In 2023, “Other financial profit/(loss)” in Corporation included the profit generated on the sale of the 24.99%
holding in FCC Servicios Medio Ambiente Holding, S.A. (note 4) for the amount of 888,779 thousand euros
for the difference between the cost of this holding and its sale price net of the expenses inherent to the
operation. This profit was removed from the eliminations column as for the Group as a whole, this was
booked as an equity transaction taken to reserves (notes 4 and 17).

363

Balance sheet by segments

2023

A S S E T S

Non-current assets

Intangible assets

Additions

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

10,655,661

3,408,786

3,316,253

719,482

816,330

2,566,979

654,698

4,089,667

(4,916,534)

2,483,475

75,228

926,629

19,489

1,022,159

34,759

Property, plant and equipment

3,829,799

1,944,256

1,072,682

Additions

Investment property

Additions

835,265

2,091,328

17,778

Investments accounted for using the equity method

1,034,288

Non-current financial assets

Deferred tax assets

Current assets

Inventories

Trade and other receivables

Other current financial assets

Other current assets

Cash and cash equivalents

748,425

468,346

6,062,014

1,234,338

2,886,531

260,545

70,897

1,609,703

521,964

184,426

–

233,202

245,660

59,039

1,696,939

87,211

1,095,822

87,489

29,824

396,593

3,150

832

47,006

1,127,778

43,478

961,866

51,838

530,853

68,025

7,636

303,514

78,683

709

183,525

85,355

–

43,328

104,736

309,210

2,395,120

276,578

1,099,145

340,166

27,338

651,893

148,924

428

477,413

41,691

–

132,376

4,148

53,469

231,513

103,281

110,704

11,270

1,493

4,765

631

155

2,088,178

16,946

441,970

14,951

21,175

822,261

718,209

21,394

17,029

4,174

61,455

358,979

18,650

3,585

297

–

123,044

144,669

24,421

65,129

1,228

9,601

28,834

431

25,035

4,366

1,139

168,768

3,308

–

12,996

(56,339)

–

(21,061)

(1,931)

–

366

3,781,563

(4,675,080)

121,974

627,017

275

60,087

400,206

166,448

(164,420)

(737,831)

(4,282)

(41,075)

(692,474)

–

Total assets

16,717,675

5,105,725

4,278,119

3,114,602

1,047,843

3,389,240

719,827

4,716,684

(5,654,365)

364

2023

L I A B I L I T I E S

Equity

Non-current liabilities

Grants

Non-current provisions

Non-current financial liabilities

Deferred tax liabilities

Other non-current liabilities

Current liabilities

Current provisions

Current financial liabilities

Trade and other payables

Internal relations

Total liabilities

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

6,145,927

1,102,480

1,025,904

1,288,677

679,274

1,981,723

267,697

3,214,236

(3,414,064)

6,708,319

2,879,179

2,395,315

243,008

244,000

894,525

226,624

1,230,595

4,817,034

284,179

149,887

4,285

561,787

47,282

236,724

2,052,887

2,020,383

128,817

131,403

3,863,429

1,124,066

159,610

926,771

2,777,048

–

4,992

477,854

646,279

(5,059)

72,442

18,484

856,900

17,659

279,759

559,482

–

193,518

23,354

26,136

–

610

36,817

142,214

64,359

–

1,582,917

124,569

127,695

23,898

1,431,324

–

3,357

47,345

73,867

–

26,399

713,866

154,260

–

512,992

2,903

419,635

90,454

–

381,913

174,447

54,870

146,796

5,800

–

70,217

1,065

55,498

13,654

–

1,175,175

(1,504,796)

–

120,480

–

1,053,774

(1,336,240)

921

–

(168,556)

–

327,273

(735,505)

1,939

298,983

21,066

5,285

–

(676,201)

(59,078)

(226)

16,717,675

5,105,725

4,278,119

3,114,602

1,047,843

3,389,240

719,827

4,716,684

(5,654,365)

365

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

2022

A S S E T S

Non-current assets

Intangible assets

Additions

9,874,542

3,164,348

3,125,791

2,342,148

64,347

932,535

21,003

Property, plant and equipment

3,496,804

1,713,092

Additions

Investment property

Additions

Investments accounted for using the equity method

Non-current financial assets

Deferred tax assets

Current assets

Inventories

Trade and other receivables

Other current financial assets

Other current assets

Cash and cash equivalents

598,412

2,122,854

21,599

502,629

910,567

499,540

5,407,999

1,143,202

2,409,262

221,252

58,745

1,575,538

401,831

–

194,887

258,395

65,439

1,594,944

57,346

971,826

70,593

31,641

463,538

902,913

40,798

993,061

119,901

2,560

–

54,353

1,135,874

37,030

829,780

41,528

471,722

64,492

5,632

246,406

803,020

78,209

337

154,497

58,784

–

40,712

197,041

332,561

2,158,697

179,954

796,817

387,888

15,454

778,584

728,894

148,608

854

470,038

13,978

–

42,690

3,990

63,568

236,746

105,207

110,741

12,271

1,215

7,312

2,325,704

924

2,120,294

21,599

40,006

152,699

11,737

874,862

758,219

21,243

41,639

4,363

49,398

601,856

330,686

–

118,358

143,219

9,556

40,446

198

9,556

12,450

180

18,062

3,904,676

(4,779,747)

5,494

1,352

185,430

3,843

–

11,381

(56,341)

–

(20,275)

–

242

3,555,899

(4,536,550)

146,472

310,239

1,098

74,411

222,232

260

12,238

(166,823)

(637,715)

(348)

(47,054)

(590,313)

–

Total assets

15,282,541

4,759,292

3,955,571

2,961,717

965,640

3,200,566

642,302

4,214,915

(5,417,462)

366

2022

L I A B I L I T I E S

Equity

Non-current liabilities

Grants

Non-current provisions

Non-current financial liabilities

Deferred tax liabilities

Other non-current liabilities

Current liabilities

Current provisions

Current financial liabilities

Trade and other payables

Internal relations

Total liabilities

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

4,938,993

6,046,615

202,864

1,141,750

4,271,282

281,977

148,742

909,450

977,656

1,178,455

2,231,734

2,319,042

236,140

4,265

544,299

37,291

184,556

1,418,164

2,017,592

130,032

134,974

65,835

13,768

–

194,913

10,289

30,938

–

595,120

246,352

610

23,371

156,788

65,583

–

4,296,933

1,618,108

658,873

1,547,122

124,168

148,074

1,333,125

2,815,734

–

5,115

911,693

699,890

1,410

14,377

68,376

118,276

29,827

576,120

1,399,019

–

4,661

28,866

90,641

–

1,893,734

971,668

–

27,784

783,845

160,039

–

335,164

2,443

249,265

83,456

–

238,034

338,826

160,700

47,874

130,252

–

65,442

1,133

52,820

11,489

–

2,354,572

(3,208,028)

1,273,388

(1,570,535)

–

118,953

(2)

–

1,153,968

(1,399,616)

467

–

586,955

2,069

557,798

28,264

(1,176)

(170,917)

–

(638,899)

–

(565,520)

(73,145)

(234)

15,282,541

4,759,292

3,955,571

2,961,717

965,640

3,200,566

642,302

4,214,915

(5,417,462)

367

Cash flows by segment

2023

Operating activities

From investing activities

Financing activities

Other cash flows

Cash flows for the year

2022

Operating activities

From investing activities

Financing activities

Other cash flows

Cash flows for the year

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

785,386

(962,436)

210,258

957

400,444

(527,502)

57,992

2,122

257,296

(174,151)

(30,285)

4,247

(262,273)

56,068

83,767

(4,253)

34,165

(66,944)

57,107

(126,691)

1,545,839

(938,045)

(567,196)

(585)

531,644

(385,164)

(55,143)

(8,230)

235,496

(273,097)

(316,370)

(1,546)

506,839

(12,104)

(60,990)

8,817

124,451

(100,235)

(25,969)

(793)

(2,546)

(13,539)

(13,422)

12,824

(126)

155,670

(81,749)

(61,862)

(2)

12,057

166,584

(154,654)

(29,973)

–

33,916

87,095

(114,344)

305

6,972

31,131

(43,959)

(18,970)

501

63,668

(243,123)

334,334

(669)

154,210

105,386

(17,965)

(153,956)

(1)

40,013

83,107

(355,517)

442,562

(14,263)

(18,043)

(31,297)

(66,536)

12,214

21,161

(33,375)

–

(17,702)

(37,680)

55,382

–

Consolidated Group | Notes to the consolidated financial statements | Page 91 of 139

b) Activities and investments by geographic markets

The Group performs approximately 48% of its activity abroad (45% in 2022).

The Revenue realised abroad by the Group companies for the business years 2023 and 2022 is distributed
among the following markets:

2023

United Kingdom

Czech Republic

Georgia

Rest of Europe and Others

USA and Canada

Latin America

Middle East, Africa and Australia

2022

United Kingdom

Czech Republic

Georgia

Rest of Europe and Others

USA and Canada

Latin America

Middle East, Africa and Australia

Total Group

Environmental
Services

Integrated Water
Management

Construction

Cement

Real Estate

Concessions

Corporation

Eliminations

1,113,996

413,737

79,240

980,987

608,156

697,201

395,448

778,736

265,689

–

370,977

351,562

–

249,949

89,598

148,048

79,240

115,000

–

91,276

134,667

–

452,661

237,303

581,846

193,277

–

35,078

19,291

20,212

69,189

4,288,765

1,766,964

568,231

1,715,036

233,368

1,048,589

385,321

65,292

878,266

285,565

474,679

296,798

794,945

264,954

–

358,813

247,240

–

178,292

78,158

120,364

65,292

161,974

–

48,319

65,806

–

322,210

23,400

410,845

162,048

–

26,904

14,925

12,560

69,382

3,434,510

1,665,952

461,755

1,096,798

201,929

–

3,867

–

3,867

–

2,955

–

2,955

–

7,271

–

7,271

–

8,535

–

8,535

(4,294)

–

(1,685)

(5,979)

(2,806)

–

(170)

–

(438)

(3,414)

Consolidated Group | Notes to the consolidated financial statements | Page 92 of 139

The following items included in the accompanying financial statements are shown below by geographical
areas:

Total Group

Spain

United Kingdom

Georgia

Czech Republic

Rest of Europe
and Others

United States
of America
and Canada

Latin America

Middle East
and Africa

369

2023

A S S E T S

Intangible assets

Property, plant and equipment

Investment property

Deferred tax assets

2022

A S S E T S

Intangible assets

Property, plant and equipment

Investment property

Deferred tax assets

c) Personnel

2,483,475

3,829,800

2,091,328

468,346

1,172,955

1,761,439

2,088,178

409,898

2,342,148

3,496,804

2,122,854

499,540

1,214,779

1,512,754

2,120,294

444,666

455,196

532,068

–

7,919

453,521

556,861

–

16,040

664

463,786

3,150

–

1,770

434,978

2,560

–

2,133

339,984

5,551

2,236

342,537

–

5,434

280,323

410,626

–

17,799

254,017

354,623

–

17,166

160,142

260,958

–

80,321

241,111

–

The average number of people employed in 2023 and 2022 by business Areas is as follows:

Environmental Services

Integrated Water Management

Construction

Cement

Real Estate

Concessions

Corporation

378,125

38,484

–

25,145

295,082

34,249

–

13,332

2023

44,565

13,186

7,014

1,073

101

157

296

33,937

22,455

–

2,034

40,422

19,691

–

2,902

2022

42,996

12,168

6,480

1,060

103

365

66,392

63,230

370

28. Environmental information

The Corporate Responsibility Master Plan contains the environmental policy, enhancing the socially
responsible commitment as part of the strategy of the FCC Group, which is highly involved in
environmental services.

The FCC Group carries out its activities on the basis of business commitment and responsibility,
compliance with applicable legal requirements, respect for the relationship with its stakeholders and its
ambition to generate wealth and social well-being.

Aware of the importance of preserving the environment and using available resources responsibly, and in
line with its vocation to serve through activities with a clear environmental focus, the FCC Group promotes
and enhances the following principles, on which its contribution to sustainable development is based,
throughout the organisation:

Continuous improvement

Promote environmental excellence by establishing objectives for the continuous improvement of
performance, minimising the negative impacts of the FCC Group's processes, products and services, and
enhancing the positive impacts.

Monitoring and control

Life cycle of products and services

Enhance environmental considerations in business planning, procurement of materials and equipment,
and relations with suppliers and contractors.

The necessary participation of all parties

Promote the knowledge and application of environmental principles among employees and other
stakeholders.

Share experience in the most excellent practices with the different agents in order to promote alternative
solutions to those currently in place, which contribute to the achievement of a sustainable environment.

This Environmental Policy is materialised through the implementation of quality management and
environmental management systems, as well as follow-up audits, which accredit the FCC Group's
performance in this area. Regarding the management of environmental risks, the Group has implemented
environmental management systems certified under the ISO 14001 standards, which focus on:

a) Compliance with applicable regulations and the achievement of environmental objectives that exceed

external requirements.

b) The reduction of environmental impacts through proper planning.

c) The continuous analysis of risks and possible improvements.

Establish environmental indicator management systems for the operational control of processes, which
provide the necessary knowledge for the monitoring, evaluation, decision-making and communication of
the FCC Group's environmental performance and compliance with the commitments undertaken.

The basic tool to prevent this risk is the environmental plan that each operational unit must prepare and
which consists of:

a) The identification of environmental aspects and applicable legislation.

Climate change and pollution prevention

Lead the fight against climate change through the implementation of processes with lower greenhouse
gas emissions, and by promoting energy efficiency and renewable energies.

Preventing pollution and protecting the natural environment through the responsible management and
consumption of natural resources and by minimising the impact of emissions, discharges and waste
generated and managed by the FCC Group's activities.

Observation of the environment and innovation

Identify the risks and opportunities of activities in the face of the changing landscape of the environment
in order, among other things, to promote innovation and the application of new technologies, as well as the
generation of synergies between the various activities of the FCC Group.

Impact evaluation criteria.

c) The measures to be taken.

d) A system for measuring the objectives achieved.

The very nature of the activity of the Environmental Services Area is aimed at the protection and
conservation of the environment, not only through productive activity: (waste collection, road cleaning,
operation and control of landfills, sewer cleaning, treatment and disposal of industrial waste, etc.), but
also for the development of this activity through the use of production techniques and systems aimed at
reducing environmental impact even more meticulously than required by the regulations on these matters.

The Construction Area adopts environmental practices in the execution of the works that allow for a
respectful action with the environment, minimising its environmental impact by reducing the emission
of dust into the atmosphere, controlling the level of noise and vibrations, controlling water discharges
with special emphasis on the treatment of fluids generated by the works, the maximum reduction of
waste generation, the protection of the biological diversity of animals and plants, protection of the
urban environment due to occupation, pollution or loss of soils and the development of specific training
programmes for technicians involved in the process of making decisions with an environmental impact, as
well as the implementation of an "Environmental performance code" that establishes the requirements for
subcontractors and suppliers regarding the protection and defence of the environment.

The Real Estate Area, in carrying out its usual development activities, considers the environmental impact
of its projects and investments as a key aspect. However, it has not been necessary to incorporate
systems, equipment or installations for the protection and improvement of the environment into tangible
fixed assets.

Nor is it considered that there are no significant contingencies related to the protection and improvement
of the environment as at 31 December 2023 that may have a significant impact on the accompanying
financial statements.

For more information on the provisions of this note, the reader should refer to the Statement of Non-
Financial Information the Group publishes annually, among other channels, on the web page www.fcc.es.

Consolidated Group | Notes to the consolidated financial statements | Page 94 of 139

The development of the production activity of the Environmental Services Area requires the use of
buildings, technical installations and specialised machinery that are efficient in protecting and conserving
the environment. At 31 December 2023, the acquisition cost of the productive fixed and non-current
assets, net of depreciation, of the Environmental Services Area amounted to 2,870,885 thousand euros
(2,645,627 thousand euros at 31 December 2022). Environmental provisions, mainly for landfill sealing and
closing costs, amount to 482,546 thousand euros (476,679 thousand euros as at 31 December 2022).

The activities carried out by Aqualia are directly linked to the protection of the environment, as the guiding
thread of its actions, in collaboration with the different Public Administrations, is the efficient management
of the end-to-end water cycle and the search for guarantees for the availability of water resources that
allow for the sustainable growth of the populations where it provides its services. One of FCC Aqualia's
fundamental objectives is continuous improvement through an Integrated Management System,
which includes both the quality management of processes, products and services and environmental
management. The main actions carried out are: Water quality control in both collection and distribution,
24-hour service 365 days a year making it possible to fix faults in distribution networks in the shortest
possible time, with the consequent saving of water, optimisation of electricity consumption, the elimination
of environmental impacts caused by wastewater discharges and the management of energy efficiency in
order to reduce the carbon footprint.

Cement companies have fixed and non-current assets for filtering gases that are discharged into the
atmosphere, in addition to meeting the commitments made in the environmental recovery of depleted
quarries and applying technologies that contribute to the efficient environmental management of
processes. Additionally, major efforts are being made in terms of production and marketing of cements
with a higher percentage of additions that reduce the clinker content while maintaining their performance
on site, making it possible to reduce the carbon footprint in its main product, cement. Also worth note is
the increase in material recovery with greater use of secondary raw materials, increasing the percentage of
energy substitution in clinker kilns.

At year-end the Cementos Portland Valderrivas Group has investments related to environmental activities
recorded under intangible assets and property, plant and equipment for a total amount of 139,300
thousand euros (137,960 thousand euros in 2022), with accumulated amortisation of 113,693 thousand
euros (108,756 thousand euros in 2022). In 2023, it also incurred expenses of 3,508 thousand euros
(2,562 thousand euros in 2022) to ensure the protection and improvement of the environment, which were
recognised under "Other operating expenses" in the accompanying consolidated income statement.

For the cement activity, the Group receives free CO2 emission rights in accordance with the corresponding
national allocation plans. During 2023 and 2022, no greenhouse gas rights were sold.

29. Financial and non-financial risk
management policies

The concept of financial risk refers to the changes in the financial instruments arranged by the Group as
a result of political, market and other factors and the repercussion thereof on the financial statements.
The risk management philosophy of the Group is consistent with their business strategy, and seeks
to achieve maximum efficiency and solvency at all times. To this end, strict financial and non-financial
risk management and control criteria have been established, identifying, measuring, analysing and
controlling the risks incurred in the Group’s operations. The risk policy has been integrated into the Group’s
organisation in the appropriate manner.

In view of the Group’s activities and the transactions through which it carries on its business, it is currently
exposed to the following risks:

a) Capital risk

To manage capital, the main objective of the Group is to reinforce its financial-equity structure, in order
to improve the balance between borrowed funds and shareholders’ equity, and the Group endeavours to
reduce the cost of capital and, in turn, to preserve its solvency status, in order to continue managing its
activities and to maximise shareholder value, not only at Group level, but also at the level of the parent,
Fomento de Construcciones y Contratas, S.A.

The Group's basic capital base is equity in the balance sheet which, for management and monitoring
purposes, excludes the item "Changes in fair value of financial instruments" and "Translation differences".

The first of these headings is disregarded for management purposes as it is considered as part of interest
rate management, since it is mainly the result of the assessment of instruments that transform floating-
rate debt into fixed-rate debt. Translation differences, meanwhile, are managed within the exchange rate
risk.

Given the sector in which it operates, the Group is not subject to external capital requirements, although
this does not prevent the frequent monitoring of equity to guarantee a financial structure based on
compliance with the prevailing regulations of the countries in which it operates, also analysing the capital
structure of each of the subsidiaries to enable an adequate distribution between debt and capital.

The above is reflected in the results of ratios, debt levels and the high percentage classed as Investment
grade, mainly in the parent's subsidiaries that account for a large part of the Group's financial debt, such as
FCC Aqualia and FCC Servicios Medio Ambiente Holding.

372

In addition, as more extensively explained in note 19 on Non-current and current financial liabilities, in June
2022 the refinancing in the Water area was completed for the sum of €1,100 million. Moreover, in July
2020, FCC Servicios Medioambiente Holding, S.A. registered, and since then has renewed once a year, a
promissory note programme, Euro Commercial Paper Programme (ECP), on the Irish stock exchange, for
a maximum amount of 400 million euros and in October 2023 refinanced 600 million euros through a new
bond issue. Fomento de Construcciones y Contratas, S.A. has had a promissory note programme - Euro
Commercial Paper Program (ECP) - registered in that same market since November 2018, for an amount
of 600 million euros. In 2023, new financing facilities were also renewed and taken out in the form of lines
of credit and bilateral loans.

These operations have helped to continue to shore up the financial solvency process and the continuation
of the policy of diversifying funding sources. These measures have contributed to achieving a much more
robust and efficient capital structure, with suitable volumes, terms and financing costs adapted to the
nature of the different business Areas.

The Economic-Finance Division, as responsible for financial risk management, regularly reviews the
debt-equity ratios and compliance with financing covenants, together with the capital structure of the
subsidiaries.

b) The FCC Group is exposed to currency exchange risk

A noteworthy consequence of the Group’s positioning in international markets is the exposure resulting
from net positions in foreign currencies against the euro or in one foreign currency against another when
the investment and financing of an activity cannot be arranged in the same currency.

Although the benchmark currency in which the Group mainly operates is the euro, the Group also holds
financial assets and liabilities accounted for in currencies other than the euro. Exchange rate risk is mainly
found in debt denominated in foreign currency, except when this entails a natural hedge of the assets
financed since they are denominated in the same currency, in investments in international markets, and in
collections and payments in currencies other than the euro.

The following shows the composition by currencies of the Group's gross debt at 31 December 2023:

Gross debt

Financial assets

Euro

4,407,122

(834,286)

Dollar

168,001

(293,363)

Total consolidated Net indebtedness

3,572,836

(125,362)

% Endeudamiento Neto sobre el total

115.2%

(4.0%)

CONSOLIDATED (thousands of euros)

Pound

Czech Koruna

Rest of Europe
non-euro

303,179

(244,251)

58,928

1.9%

170

(45,872)

(45,702)

(1.5%)

1,954

(108,488)

(106,534)

(3.4%)

Latin America

Other

TOTAL

58,296

(98,859)

(40,563)

(1.3%)

26,368

(239,865)

4,965,090

(1,864,984)

(213,497)

3,100,106

(6.9%)

100.0%

373

Note 16 of these Financial Statements provides a break down of Cash and Equivalents by currency; in this
breakdown, we can see how 45.5% is denominated in euros, 18.0% is denominated in US dollars, 13.5% in
sterling and 6.9% in Saudi riyals.

The Group’s general policy is to mitigate the adverse effect that exposure to the different foreign currencies
could have on its financial statements as much as possible, with regard to both transactional and purely
equity-related movements. The Group therefore manages the effect that foreign currency risk can have on
the balance sheet and the income statement.

Pound sterling

US dollar

Georgian lari

Algerian dinar

Czech koruna

A summary table of the sensitivity to exchange rate changes in the translation of foreign currency financial
statements in the main currencies in which the Group operates is shown below (note 17):

Total

Pound sterling

US dollar

Georgian lari

Algerian dinar

Czech koruna

Total

10%

Profit and Loss

504

1,159

2,401

3,813

14,350

-10%

Profit and Loss

(504)

(1,159)

(2,401)

(3,813)

Equity

45,903

36,487

16,577

16,255

10,729

125,951

Equity

(45,903)

(36,487)

(16,577)

(16,255)

(10,729)

(14,350)

(125,951)

The impact on sterling is mainly due to the translation of the net assets corresponding to the investment
held in the FCC Environment UK subgroup.

374

Consolidated Group | Notes to the consolidated financial statements | Page 97 of 139

c) The FCC Group is exposed to interest rate risk

The Group is exposed to interest rate fluctuations due to the fact that the Group’s financial policy aims to
ensure that its current financial assets and debt are partially tied to variable interest rates. The benchmark
interest rate for the Group's debt arranged with credit entities in euros is mainly the Euribor.

Any increase in interest rates could give rise to an increase in the Group's financing costs associated with
its borrowings at variable interest rates, and could also increase the cost of refinancing the borrowings and
the issue of new debt.

In order to ensure a position that is in the best interests of the Group, an interest rate risk management
policy is actively implemented, with on-going monitoring of markets and assuming different positions
depending primarily on the asset financed.

In addition, within the framework of the policy for managing this risk carried out by the Group, fixed-rate
debt issuance operations have been carried out in capital markets together with interest rate hedges and
fixed-rate financing, totalling 61.3% of the Group's total gross debt at the end of the year, including hedging
on structured project financing.

The following table shows a breakdown of the gross debt of the FCC Group as well as the hedged debt,
either because it is a fixed rate debt or through derivatives:

Total Gross

External Debt

Fixed-rate headings and financing at 31.12.23

Total variable rate debt

Ratio: Variable rate debt /Gross External Debt at 31.12.23

Total Group

Construction

Environmental
Services

Cement

Integrated Water
Management

Concessions

Real Estate

Corporation

4,965,090

(3,042,444)

1,922,646

38.7%

8,150

(1,653)

6,497

79.7%

1,908,765

(1,665,034)

243,731

140,932

(1,196)

139,736

2,029,496

(733,313)

1,296,183

101,959

–

101,959

774,296

(641,248)

133,048

1,492

–

1,492

12.8%

99.2%

63.9%

100.0%

17.2%

100.0%

The following table summarises the effect on the Group's income statement of upward movements in the
interest rate curve on gross borrowings, after excluding fixed-rate debt and debt associated with hedging
agreements:

Impact on profit or loss

+25 pb

4,807

Gross indebtedness

+50 pb

9,613

+75 pb

14,420

d) Solvency risk

At 31 December 2023, the net financial indebtedness of the Environmental Services Group contained in
the accompanying consolidated balance sheet amounted to 3,100,106 thousand euros as shown in the
following table (3,192,719 thousand euros at 31 December 2022):

Bank borrowings

Debt instruments and other loans

Other interest-bearing financial debt

Current financial assets

Treasury and cash equivalents

Net interest-bearing debt

2023

2,709,929

2,107,100

148,061

(255,281)

2022

2,778,349

2,040,747

163,364

(214,203)

(1,609,703)

(1,575,538)

3,100,106

3,192,719

Net debts with limited recourse

4,001,840

3,869,904

Net indebtedness with recourse

(901,734)

(677,185)

In turn, Net Debt with limited recourse increased year on year mainly due to the higher indebtedness of the
Environmental Services area (note 19).

e) The FCC Group is exposed to liquidity risk

The Group carries out its operations in sectors that require a high level of financing, and has so far
obtained adequate financing to carry out its operations. However, the Group cannot guarantee that these
circumstances relating to obtaining financing will continue in the future.

The Group's ability to obtain financing depends on many factors, many of which are outside its control.

Historically, the Group has always been able to renew its loan arrangements, and it expects to continue
doing so in the coming twelve months. However, FCC Group’s ability to renew its financing depends on
various factors, many of which are outside the control of the Group, such as general economic conditions,
the availability of funds for loans from private investors and financial institutions, and the monetary
policy of the markets in which it operates. Negative conditions in debt markets could hinder or prevent
Group’s capacity to renew its financing. Therefore, the Group cannot guarantee its ability to renew credit
agreements and bond issues under economically attractive terms. The inability to renew said financing or

375

to secure it under acceptable terms could have a negative impact on the Group's liquidity and its ability to
meet the working capital needs.

To adequately manage this risk, the Group performs exhaustive monitoring of the repayment dates of all
credit facilities of each Group company, in order to conclude all renewals in the best market conditions
sufficiently in advance, analysing the suitability of the funding and studying alternatives if the conditions
are unfavourable on a case-by-case basis. The Group is also present in several markets, which facilitates
obtaining credit facilities and mitigating liquidity risk.

At 31 December 2023, the Group's schedule of maturities of external gross debt was as follows:

2024

605,434

2025

687,989

2026

2027 and beyond

TOTAL

1,957,205

1,714,462

4,965,090

Almost the entire amount of the gross financial debt, amounting to €4,955,167 thousand, has no recourse
to the parent company, of note being the debt of the End-to-end Water Management segment amounting
to 2,029,496 thousand euros, and of the Environmental Services segment amounting to 1,908,765
thousand euros at 31 December 2023.

At 31 December 2023, the Group had working capital of 2,198,585 thousand euros (1,111,066 thousand
euros at 31 December 2022).

In order to manage liquidity risk, at 31 December 2023, the Group had 591.7 million euros in undrawn
bilateral financing lines, and 1,219,996 thousand euros in cash, in addition to the following current financial
assets and cash equivalents, whose maturities are shown below:

Thousands of euros

Amount

1-3 months

3-6 months

6-9 months

9-12
months

Other current financial assets

255,281

23,711

18,760

17,029

195,781

Thousands of euros

Cash equivalents

Amount

1 month

1-2 months

2-3 months

389,707

189,624

–

200,083

376

f) Concentration risk

This is risk arising from the concentration of lending transactions with common characteristics, and it is
distributed as follows:

• Funding sources: In order to diversify this risk, the Group works with a large number of national and

international financial institutions and capital markets to obtain financing.

• Markets/geography (domestic, foreign): The Group operates in a wide variety of national and

international markets, with the debt mainly concentrated in euros and the rest in various international
markets, with different currencies.

• Products: The Group uses various financial products: loans, credit facilities, promissory notes and

obligations, syndicated loans, assignments and discounting, etc.

• Currency: The Group is financed through many different currencies according to the country of the

authorised by the Finance Division. Likewise, on-going monitoring is performed of debt delinquency in
various management committees.

The maximum level of exposure to credit risk has been calculated, with the breakdown of the amount as at
31 December 2023 and 2022 as shown in the following table:

Financial credits granted (note 13)

Trade and other receivables (note 15)

Derivative financial assets (note 22)

Cash and cash equivalents (Note 16)

Guarantees granted (Note 25)

2023

1,092,422

2,886,530

30,445

1,609,703

5,041,504

2022

1,060,903

2,409,262

46,330

1,575,538

4,697,135

investment.

TOTAL

10,660,604

9,789,168

The Group’s strategic planning process identifies the objectives to be attained in each of the areas of
activity, based on the improvements to be implemented, the market opportunities and the level of risk
deemed acceptable. This process serves as a base for preparing operating plans that specify the goals to
be reached each year.

To mitigate the market risks inherent to each line of business, the Group maintains a diversified
position among businesses related to the construction and management of infrastructure, provision of
environmental services and others. In the area of geographical diversification, in 2023 the weight of the
external activity has been 48% of total sales, with special importance in the activities of Environmental
Services and Infrastructure Construction.

In general, the Group does not have collateral guarantees or improvements to reduce credit risk or for
financial assets or accounts receivable from traffic. Although it should be noted that bonds are requested
from subscribers in the case of certain contracts of the Water activity, mostly concessions affecting IFRIC
12, there are also offsetting mechanisms in certain contracts, mostly concessions affecting IFRIC 12 in
Water, Environmental Services and Concession activities, making it possible to guarantee the recovery of
loans granted to finance early initial fees or investment plans.

With respect to credit quality, the Group applies its best judgement to impair financial assets for which
lifetime credit losses are expected to be incurred (note 3.i). The Group regularly analyses changes in the
public ratings of the entities to which it is exposed.

g) Credit risk

Risk hedging financial derivatives

The provision of services or the acceptance of client engagements, whose financial solvency was not
guaranteed at the acceptance date, situations not known or unable to be assessed by the Group and
unforeseen circumstances arising during the provision of the service or the execution of the engagement
that could affect the client’s financial position could generate a payment risk with respect to the amounts
owed.

The Group request commercial reports and assess the financial solvency of clients before doing business
and perform on-going monitoring, and have put in place a procedure to be adopted in the event of
insolvency. In the case of public-sector customers, the Group does not accept commitments that do not
have an assigned budget and financial approval. Offers that exceed a specific payment period must be

The financial derivatives contracted by the Group are treated for accounting purposes in accordance with
the accounting hedging regulations set out in these financial statements. The main financial risk hedged
by the Group through derivative instruments relates to changes in the variable interest rates to which the
financing of Group companies is linked. The financial derivatives are measured by experts on the subject
using generally accepted methods and techniques. These experts were independent from the Group and
the entities financing it.

Sensitivity analyses are carried out periodically with the objective of observing the effect of a possible
change in interest rates on the Group's accounts.

377

A simulation was carried out, proposing four bullish scenarios of the basic interest rate curve of the Euro,
coming in at around 2.43% in the medium/long term as at 31 December 2023, assuming an increase and
reduction of 50 bp and 100 bp.

The amounts in thousands of euros obtained in relation to derivatives outstanding at year-end with an
impact on equity (note 22), after applying, where applicable, the percentage of ownership interest, are
shown below.

Impact on Equity:

Full consolidation

Equity method

Hedging derivatives

-100 pb

-50 pb

+50 pb

+100pb

(11,532)

(8,512)

(5,626)

(4,072)

5,364

3,739

10,482

7,176

h) Risks generated by the Russian invasion of Ukraine

The Group does not undertake activities in Russia, Ukraine or Belarus, meaning that the Russian invasion
of Ukraine and the subsequent sanctions have not had a direct effect on its activities. However, it has
been exposed to indirect effects such as the increase in the cost of raw materials, in particular the cost of
energy, disruption to supply chains and, to a certain extent, the increase in reference interest rates.

In view of the above, the Group has reviewed the assumptions used to assess the signs of impairment of
its main non-financial assets, considering, among other factors, the increase in reference interest rates,
paying special attention to goodwill, and has determined that there is no impairment associated with it
(note 6).

Given that the Group does not operate in the aforementioned geographic markets, no significant increase
in the credit risk of its financial assets has been seen; therefore, no additional impairments have been
recognised beyond those considered inherent to the different activities it performs. Furthermore, no
difficulties have been detected in the Group's ability to obtain financing, as reflected by the transactions
undertaken over the course of the year (note 19).

The aforementioned invasion has had a limited impact on the Group, meaning that the consolidated
financial statements have been prepared applying the going concern principle, considering that the effects
described do not jeopardise the continuity of their activities.

i) Climate change risks

The Group's activities may be impacted by adverse weather conditions, such as floods or other natural
disasters, and in some cases by decreases in temperature that may make it difficult, or even impossible in
extreme cases, to carry out its activities, such as in the case of severe frost in the construction activity.

The Group takes all appropriate measures to adapt to the effects of climate change and to mitigate its
possible effects on its business and fixed assets, as shown by the environmental provisions set aside for
this purpose (note 18).

The Group is committed to the decarbonisation of the activities it carries out, for which it uses the most
efficient technologies in the fight against climate change and, due to the very nature of some of the
activities it carries out, it promotes the circular economy. In order to achieve these objectives, the Group
implements specific policies in its activities.

The Construction area has an Integrated Policy to analyse environmental incidents, the involvement of
the interested parties and the establishment of a plan to reduce the significant impacts of the activities
of the works, emphasising the mitigation of the generation of waste, the consumption of resources, the
generation of noise and vibrations, promoting the use of sustainable and reusable materials and the
sustainable use of water. It has environmental certifications in several of the countries in which it operates,
as well as environmental certification according to ISO 14001 at the centres located in Spain at some of its
main investees.

The very nature of the Environmental Services Area aims to protect and conserve the environment and
contribute to the circular economy by treating waste as a resource, through its reuse and energy recovery.
Likewise, it uses technologies and equipment to optimise water consumption, promoting a rational use
and the use of water from alternative sources, such as the use of rainwater. As for policies aimed at
optimising energy consumption, Spain has an Energy Management System certified in accordance with
the ISO 50001 standard and projects for the use of landfill gas to generate electricity and hot water.

In 2021, the Water Area was the first company in the sector to certify the Strategy for the Contribution
of the Sustainable Development Goals, by AENOR. Furthermore, the Area has implemented energy
management policies with a view to optimising energy consumption at its facilities; this policy is reflected
in the calculation of the company's Carbon Footprint at its plants in Spain. The Area has also implemented
policies to reduce greenhouse gas emissions, through the signing of a PPA (Power Purchase Agreement)
contract for renewable energies (photovoltaic) and projects to install renewable energy (photovoltaic) at
some of its facilities.

378

The Cement Area takes measures that are specified at each facility, taking into account the current
context of each one, its technological, human and economic resources, the applicable legislation and
the expectations of the interested parties. The objectives of such measures are to promote the circular
economy and to reduce greenhouse gas emissions by increasing material and energy recovery with
a greater use of decarbonised raw materials, recoverable waste and biomass fuels, increasing energy
efficiency through the optimisation of the fuel mix and the use of expert systems in the manufacturing
process and transition to LED lighting and increasing the mix of renewable energies through solar and/or
wind energy facility projects and boosting the consumption of biomass in clinker manufacturing.

Pursuant to the reporting requirements set out in the Taxonomy Regulation (EU) 2020/852, the Group has
analysed the proportion of its economic activities that are eligible, and where appropriate, aligned and
non-aligned, and ineligible under the Environmental Taxonomy, in terms of business volume, CapEx and
OpEx relative to 2023. The Statement of Non-Financial Information that forms part of the Management
Report provides greater details about the results and methodology followed in the application of the
aforementioned Regulation, in particular specifying how the Group has analysed the climate risks affecting
all its activities.

As a result of the above, the Group has prepared its financial statements on a going concern basis, as
there are no doubts about the Group's continued existence.

30. Information on transactions with related parties

a) Transactions with directors of the Parent Company and senior

executives of the Group

The amounts accrued for fixed and variable remuneration received by the Directors of Fomento de
Construcciones y Contratas, S.A. in 2023 and 2022, to be paid by the latter or any of the Group companies,
jointly managed or associated, are as follows:

Fixed remuneration

Other payments

2023

966

1,879

2,845

2022

893

1,671

2,564

The senior executives listed below, who are not members of the Board of Directors, received total
remuneration of 2,180 thousand euros (5,793 thousand euros in the 2022 business years).

2023

Marcos Bada Gutiérrez

Felipe B. García Pérez

Miguel A. Martínez Parra

Félix Parra Mediavilla

Jaime Rocha Font

2022

Marcos Bada Gutiérrez

Felipe B. García Pérez

Miguel A. Martínez Parra

Félix Parra Mediavilla

General manager of Internal Audit

General Secretary

Managing Director of Administration and Finance

Managing Director of FCC Aqualia

CEO of Cementos Portland Valderrivas

General manager of Internal Audit

General Secretary

Managing Director of Administration and Finance

Managing Director of FCC Aqualia

Consolidated Group | Notes to the consolidated financial statements | Page 102 of 139

Note 24 "Pension plans and similar obligations" describes the insurance taken out in favour of certain
executive directors and directors.

Details of Board members who hold posts at companies in which Fomento de Construcciones y Contratas,
S.A. has a direct or indirect ownership interest were as follows:

Name or corporate
name of the director

Company name
of the Group entity

Position

ALICIA ALCOCER KOPLOWITZ CEMENTOS PORTLAND

VALDERRIVAS, S.A.

CHAIRWOMAN (ACTING ON BEHALF
OF EAC INVERSIONES CORPORATIVAS,
S.L.)

REALIA BUSINESS, S.A.

DIRECTOR

GERARDO KURI KAUFMANN

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

NON-EXECUTIVE VICE PRESIDENT

REALIA BUSINESS, S.A.

NON-EXECUTIVE VICE PRESIDENT

FCyC, S.A.

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

CHAIRMAN

DIRECTOR

JUAN RODRÍGUEZ TORRES

REALIA BUSINESS, S.A.

NON-EXECUTIVE CHAIRMAN

FCC AQUALIA, S.A.

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

ALVARO VÁZQUEZ DE
LAPUERTA

ALEJANDRO ABOUMRAD
GONZÁLEZ

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

REPRESENTATIVE OF THE DIRECTOR
INMOBILIARIA AEG, S.A. DE C.V.

ESTHER ALCOCER
KOPLOWITZ

CARMEN ALCOCER
KOPLOWITZ

379

Name or corporate
name of the director

Company name
of the Group entity

Position

PABLO COLIO ABRIL

FCC CONSTRUCCIÓN, S.A.

CHAIRMAN

FCC ENVIRONMENT (UK) LIMITED

DIRECTOR

FCC MEDIO AMBIENTE REINO
UNIDO, S.L.U.

DEPUTY CHAIRMAN

FCC MEDIO AMBIENTE, S.A.

CHAIRMAN

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

DEPUTY CHAIRMAN

FCC AQUALIA, S.A.

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

FCC AUSTRIA ABFALL SERVICE AG CHAIRMAN

REALIA BUSINESS, S.A.

DIRECTOR

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

FCC AQUALIA, S.A.

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

CHAIRMAN

In 2023, no significant transactions were performed entailing a transfer of assets or liabilities between
Group companies and their executives and directors.

380

b) Situations of conflicts of interest

Buyer

Seller

No conflict of interests have been directly or indirectly declared in the interest of Fomento de
Construcciones y Contratas, S.A., in accordance with applicable regulations (Article 229 of the Spanish
Corporate Enterprises Act), without prejudice to the operations of Fomento de Construcciones y Contratas,
S.A. with its related parties reflected in this report or, as the case may be, of the agreements related to
remuneration or appointment of positions. In this regard, when specific conflicts of interest have taken
place with certain directors, they have been resolved in accordance with the procedure stipulated in the
Board of Directors’ Rules, with the directors involved abstaining from the corresponding debates and votes.

Realia Patrimonio, S.L.U.

FCC Industrial e Infraestructuras
Energéticas S.A.U.

FCC Medio Ambiente,S.A.

Servicios Especiales de Limpieza,S.A.

Fedemes,S.L.

Fomento de Construcciones y Contratas,S.A.

2023

1,047

180

494

2022

926

174

508

Realia Business, S.A.

FCC Construcción, S.A.

6,772

6,326

c) Operations between Group companies or entities

Fomento de Construcciones y Contratas,S.A.

There are numerous transactions between Group companies that are part of their routine business and
that, in any case, are eliminated in the process of preparing the consolidated financial statements.

The turnover of the attached consolidated income statement includes 289,504 thousand euros (133,495
thousand euros in 2022) from Group companies billing associates and joint ventures.

Likewise, purchases made from associates and joint ventures amounting to 19,431 thousand euros
(18,501 thousand euros in 2022) are also included in the Group's consolidated financial statements.

FCyC, S.A.

d) Transactions with other related parties

During the year, a number of transactions were approved involving companies in which shareholders of
Fomento de Construcciones y Contratas, S.A. own equity interests, the most significant of which were as
follows:

• Execution of construction and service provision contracts between Group companies, eliminated in

the process of consolidation, and investees by other parties related to the controlling shareholder, as
follows:

Fedemes,S.L.

FCyC, S.A.

Residencial Turo del Mar,C.B.

Jezzine Uno,S.L.U.

FCC Construcción, S.A.

FCC Ambito,S.A.

Fomento de Construcciones y Contratas,S.A.

Fedemes,S.L.

Realia Business, S.A.

172

142

348

163

130

175

41,050

30,170

–

140

3,780

127

104

130

3,560

134

Hermanos Revilla,S.A.

Servicios Especiales de Limpieza,S.A.

Jezzine Uno, S.L.U.

Fedemes,S.L.

Realia Business, S.A.

Fedemes,S.L.

AS Cancelas Siglo XXI, S.L

Realia Business, S.A.

2,094

1,990

FCC Real Estate UK

FCC Environment Group (UK)

Cementos Portland Valderrivas, S.A.

Realia Patrimonio, S.L.U.

Fomento de Construcciones y
Contratas,S.A.

Realia Patrimonio, S.L.U.

Fedemes, S.L.

Realia Patrimonio, S.L.U.

Giant Cement Holding Inc.

Cementos Portland Valderrivas, S.A.

Giant Cement Company

Uniland Trading B.V.

Coastal Cement Corporation

Uniland Trading B.V.

568

272

5,771

13,550

–

429

–

9,907

76,776

55,040

Consolidated Group | Notes to the consolidated financial statements | Page 104 of 139

In addition, the following balance sheet balances are maintained:

Receivable

Payable

2023

2022

Receivable

Payable

2023

2022

381

Fomento de Construcciones y Contratas,S.A.

99,936

70,122

FCC Construcción, S.A.

1,891

4,629

Jezzine Uno,S.L.U.

Realia Patrimonio, S.L.U.

Cementos Portland Valderrivas,S.A.

Fomento de Construcciones y Contratas,S.A.

FCC Industrial e Infraestructuras Energéticas S.A.U.

FCC Medio Ambiente,S.A.

Servicios Especiales de Limpieza,S.A.

Realia Business, S.A.

Fedemes,S.L.

132

412

231

132

377

273

FCC Industrial e Infraestructuras Energéticas S.A.U.

FCyC, S.A.

Asesoria financiera y de gestión,S.A.

170

211

257

Fomento de Construcciones y Contratas,S.A.

227,485

118,474

FCC Construcción, S.A.

10,109

3,316

FCC Industrial e Infraestructuras Energéticas S.A.U.

–

Costa Verde Habitat,S.L.

Jezzine Uno,S.L.U.

Realia Business, S.A.

Fedemes,S.L.

FCC Real Estate (UK) Limited

FCC Environment (UK) Limited

FCyC, S.A.

Vela Borovica Koncern d.o.o.

FCyC, S.A.

Costa Verde Habitat, S.L.

FCyC, S.A.

Planigesa, S.A.

Servicios Especiales de Limpieza,S.A.

Fomento de Construcciones y Contratas,S.A.

Fedemes,S.L.

1,993

2,340

37,043

17,618

1,440

1,437

4,005

207

189

–

126

–

Valaise, S.L. Unipersonal

FCC Industrial e Infraestructuras Energéticas S.A.U.

–

Fomento de Construcciones
y Contratas,S.A.

Realia Patrimonio, S.L.U.

2,290

2,409

Realia Business, S.A.

FCyC, S.A.

Residencial Turo del Mar,C.B.

Realia Business, S.A.

Hermanos Revilla, S.A.

Servicios Especiales de Limpieza,S.A.

Fedemes,S.L.

FCyC, S.A.

Realia Business, S.A.

Fedemes,S.L.

AS Cancelas Siglo XXI,S.L.

Realia Business, S.A.

FCC Industrial e
Infraestructuras Energéticas
S.A.U.

Realia Patrimonio, S.L.U.

Realia Business, S.A.

FCC Construcción, S.A.

FCyC, S.A.

Realia Business, S.A.

FCC Environment (UK) Limited

FCC Real Estate (UK) Limited

Fedemes,S.L.

Realia Patrimonio, S.L.U.

Realia Business, S.A.

Residencial Turo del Mar,C.B.

4,549

32,649

–

3,805

3,044

–

8,370

10,012

–

330

1,362

–

105

459

–

186

291

Giant Cement Holding Inc.

Cementos Portland Valderrivas, S.A.

4,692

5,307

Uniland Acquisition Corporation Uniland International B.V.

Giant Cement Company

Uniland Trading B.V.

Coastal Cement Corporation

Uniland Trading B.V.

1,628

3,341

–

1,729

416,192

276,025

Consolidated Group | Notes to the consolidated financial statements | Page 105 of 139

382

Additionally, during 2023, the following operations were carried out with related parties:

• Novation of the intragroup loan between FCC, S.A. and Realia Business, S.A. to extend its maturity, the

• Service provision agreement between Fomento de Construcciones y Contratas, S.A. with Vilafulder

amount of the loan being 65,000 thousand euros.

Corporate Group, S.L.U. for a total annual amount of 355 thousand euros.

• Contracts for the provision of cleaning services by Servicios Especiales de Limpieza, S.A. to Realia

• Service provision contract between Cementos Portland Valderrivas, S.A. and Mr Gerardo Kuri Kaufmann,

for an amount of 184 thousand euros.

• Contract for the provision of services between Cementos Portland Valderrivas, S.A. and Mr. Jaime

Rocha Font, for the amount of 150 thousand euros.

• Agreement for the provision of services between Realia Business, S.A. and Gerardo Kuri Kaufmann for

€184 thousand.

• In the framework of the debt refinancing associated with the Spanish activities of the Cementos
Portland Valderrivas Group in 2016, a subordinated loan agreement was entered into with Banco
Inbursa, S.A., Institución de Banca Múltiple, with carrying amount at 31 December 2023 of 50,405
thousand euros (70,405 thousand euros in 2022). On 20 October 2022, the extension of its maturity until
20 October 2025 was signed off. The financial expenses accrued during the year amounted to 2,703
thousand euros.

• Contract for the provision of IT services by Claro Enterprise Solutions, S.L. to Fomento de

Construcciones y Contratas, S.A. in the amount of 15,146 thousand euros (15,662 thousand euros in
2022).

• Commercial operations within the Cement segment with the company Trituradora y procesadora de
materiales Santa Anita S.A. de C.V. of the Elementia Group for an amount of 22,606 thousand euros
(9,390 thousand euros in 2022), with the debt pending collection as of 31 December 2023 being 713
thousand euros (2,011 thousand euros as of 31 December 2022).

• Acquisition by FCyC, S.A. of a 12.19% stake in Realia Business, S.A. from Soinmob Inmobiliaria

Española, S.A.U. for the amount of 105,000 thousand euros (Note 4).

• Acquisition by FCyC, S.A. of 3.99% of Metrovacesa, S.A. from Control Empresarial de Capitales, S.A. de

C.V. for an amount of 49,571 thousand euros (notes 4, 11, 13, 17 and 26).

• Acquisition by FCyC, S.A. of 1.95% of Metrovacesa, S.A. from Soinmob Inmobiliaria Española, S.A.U. for

an amount of 24,233 thousand euros (note 4, 11, 13, 17 and 26).

• Granting of a loan by FCC, S.A. to Realia Business, S.A. for an amount of 40,000 thousand euros.

• Granting of a loan by FCC, S.A. to FCyC, S.A. for an amount of 178,804 thousand euros.

Patrimony, S.L.U. and Hermanos Revilla, S.A. (now Planigesa, S.A.) for an amount of 511 thousands of
euros and a one-year duration.

• Contracts for the provision of cleaning services by FCC Medio Ambiente, S.A. to Realia Patrimony, S.L.U.

for an amount of 177 thousands of euros and a one-year duration.

• Contracts for the provision of maintenance services by FCC Industrial e Infraestructuras Energéticas

S.A.U. to Realia Estate, S.L.U. for an amount of 755 thousands of euros and a one-year duration.

• Contracts for real-estate development management and marketing services provided by Realia

Business, S.A. to FC y C, S.A. for an amount of 12,538 thousands of euros.

• Work execution contract by FCC Construcción, S.A. to Realia Business, S.A. for an amount of 19,851

thousand euros.

• Authorisation for the sale of dump sites in the United Kingdom to FCC Real State (UK) Ltd., both those

closed and those currently in operation once they are closed. Additionally, a contract has been signed for
the operation and maintenance by FCC Recycling (UK) of the landfills once they have been transferred to
the aforementioned company.

• Granting of a guarantee by FCC, S.A. for an amount of 30,000 thousands of euros to FCC Real Estate

(UK) Ltd. in relation to the risks of the transferred landfills.

In addition, other transactions are carried out on an arm's length basis, mainly telephone and internet
access services, with related parties related to the majority shareholder for an insignificant amount.

e) Mechanisms established to detect, determine and resolve possible
conflicts of interest between the Parent Company and/or its Group
and its directors, executives or significant shareholders

The FCC Group has established precise mechanisms to detect, determine and resolve possible conflicts
of interest between Group companies and their directors, executives and significant shareholders, as
indicated in article 20 et seq. of the Board Regulations.

383

31. Fees paid to auditors

32. Events after the closing date

After the closing date of these consolidated financial statements, on 20 February 2024, the Official State
Gazette published the ruling of the Spanish Constitutional Court, which considers Royal Decree-Law
3/2016 to be partially unconstitutional. The Group considers that this event occurred after the closing
date of the consolidated financial statements and, therefore, requires the corresponding adjustments to
be made, since the ruling has declared part of the Royal Decree mentioned above to be without validity or
effect, considering this as a situation that already existed before the consolidated balance sheet closing
date. Therefore, as at 31 December 2023, the Group has registered the accounting impacts of this ruling,
which has increased the offsetting of negative taxable amounts and the capitalisation of specific deferred
tax assets (note 23).

The fees for audit services accrued in 2023 and 2022 for audit services and other assurance services,
as well as other professional services, provided to the various Group and jointly managed companies
comprising the FCC Group by the principal auditor and other auditors participating in the audit of the
various Group companies, and also by entities related to them, both in Spain and abroad, are shown in the
following table:

Principal
auditor

4,529

526

2023

Other
auditors

754

248

Total

5,283

774

Principal
auditor

3,880

333

2022

Other
auditors

705

241

Total

4,585

574

5,055

1,002

6,057

4,213

946

5,159

–

1,141

1,917

3,058

1,141

1,917

3,058

–

1,354

1,894

3,248

1,354

1,894

3,248

Audit services

Other assurance
services

Total audit and related
services

Tax advisory services

Other services

Total professional
services

TOTAL

5,055

4,060

9,115

4,213

4,194

8,407

384

Address/Registered office

% Effective ownership

Auditor

Consolidated Group | Notes to the consolidated financial statements | Page 107 of 139

Annex I Subsidiaries

Company

Environmental services

Alfonso Benítez, S.A.

Armigesa, S.A.

Azincourt Investment, S.L.

Corporación Inmobiliaria Ibérica, S.A.

Ecoactiva de Medio Ambiente, S.A.

Federico Salmón, 13 – Madrid

Paseo de Extremadura s/n – Armilla (Granada)

Federico Salmón, 13 – Madrid

Av. Camino de Santiago, 40 – Madrid

Ctra. Puebla Albortón a Zaragoza Km. 25– Zaragoza

Ecodeal-Gestao Integral de Residuos Industriais, S.A.

Portugal

Ecogenesis Societe Anonime Rendering of Cleansing and Waste Management Services

Greece

Ecoparque Mancomunidad del Este, S.A.

Egypt Environmental Services, S.A.E.

Federico Salmón, 13 – Madrid

Egypt

Empresa Comarcal de Serveis Mediambientals del Baix Penedés – ECOBP, S.L.

Plaça del Centre, 5 – El Vendrell (Tarragona)

Energyloop, S.A.

Enviropower Investments Limited

FCC Ámbito, S.A. Unipersonal

FCC Environment Portugal, S.A.

FCC Environment Services (UK) Limited

FCC Environmental Services CA

FCC Environmental Services Florida Llc.

FCC Environmental Services Nebraska Llc.

FCC Environmental Services Texas Llc.

FCC Environmental Services (USA) Llc.

FCC Environnement France

FCC Equal CEE, S.L.

FCC Equal CEE Andalucía, S.L.

FCC Equal CEE Baleares, S.L.U.

Av. Camino de Santiago, 40 - Madrid

United Kingdom

Federico Salmón, 13 – Madrid

Portugal

United Kingdom

USA

France

Federico Salmón, 13 – Madrid

Av. Molière, 36 – Málaga

Camino Fondo, 27 - Palma (Balearic Islands)

75.01

38.26

75.01

45.01

40.22

38.26

75.01

99.25

49.96

41.26

75.01

Ernst & Young

Moore

Vaciero Auditores

Ernst & Young

Nearshore Middle East

Capital Auditors

Ernst & Young

Aranda & Hinojosa

% Effective ownership

Auditor

385

Consolidated Group | Notes to the consolidated financial statements | Page 108 of 139

Company

FCC Equal CEE Canarias, S.L.U.

FCC Equal CEE C. Valenciana, S.L.

FCC Equal CEE Murcia, S.L.

FCC Medio Ambiente, S.A.

FCC Medio Ambiente Reino Unido, S.L.Unipersonal

FCC Medioambiente Internacional, S.L.U.

Carretera de Guanarteme a Tamaraceite S/n KM5.1 - Las Maja,
35010, (Las Palmas)

Riu Magre, 6 P.I. Patada del Cid – Quart de Poblet (Valencia)

Luis Pasteur, 8 – Cartagena (Murcia)

Federico Salmón, 13 – Madrid

Av. Camino de Santiago, 40 – Madrid

FCC Servicios Medio Ambiente Holding, S.A. Unipersonal

Federico Salmón, 13 – Madrid

Gamasur Campo de Gibraltar, S.L.

Gandia Serveis Urbans, S.A.

Geneus Canarias, S.L.

Antigua Ctra. de Jimena de la Frontera, s/n – Los Barrios
(Cádiz)

Llanterners, 6 – Gandia (Valencia)

Electricista, 2. U.I. de Salinetas – Telde (Las Palmas)

Gestió i Recuperació de Terrenys, S.A. Unipersonal

Balmes, 36 Entresuelo – Barcelona

Gipuzkoa Ingurumena Bi, S.A.

Golrib, Soluções de Valorização de Residuos Lda.

Houston Waste Services, LLC

Houston Waste Solutions, LLC

Industria Reciclaje de RAEES, S.L.

Integraciones Ambientales de Cantabria, S.A.

International Services Inc., S.A. Unipersonal

Jaime Franquesa, S.A.

Jaume Oro, S.L.

Limpieza e Higiene de Cartagena, S.A.

Limpiezas Urbanas de Mallorca, S.A.

Premier Waste Services, LLC.

Reciclado de Componentes Electrónicos, S.A.

Polígono Industrial Zubiondo Par A.5. – Hernani (Gipuzkoa)

Portugal

USA

Crta. Santander, KM 61,50 - Osorno la Mayor (Palencia)

Monte de Carceña Cr CA-924 Pk 3,280 – Castañeda (Cantabria)

Av. Camino de Santiago, 40 – Madrid

P.I. Zona Franca Sector B calle D 49 – Barcelona

Av. del Bosc, s/n P.I. Hostal Nou – Bellpuig (Lleida)

Luis Pasteur, 8 – Cartagena (Murcia)

Ctra. Santa Margalida-Can Picafort – Santa Margalida
(Baleares)

USA

Calle El Matorral (Parque Actividades Medioambientales) –
Aznalcóllar (Sevilla)

Recuperació de Pedreres, S.L.

Balmes, 36 Entresuelo – Barcelona

75.01

71.26

75.01

60.01

69.01

41.26

75.01

67.51

75.01

67.51

75.01

37.51

60.01

Ernst & Young

Vaciero Auditores

Ernst & Young

Company

Resicorreia Gestao Ser Amb Lda

Serveis Municipals de Neteja de Girona, S.A.

Portugal

Pl. del Vi, 1 - Girona

Address/Registered office

% Effective ownership

Auditor

386

Servicio de Recogida y Gestión de Residuos Sólidos Urbanos del Consorcio
Vega Sierra Elvira, S.A.

Antonio Huertas Remigio, 9 – Maracena (Granada)

Servicios Especiales de Limpieza, S.A.

Sistemas y Vehículos de Alta Tecnología, S.A.

Federico Salmón, 13 – Madrid

Societat Municipal Mediambiental d’Igualada, S.L.

Pl. de l’Ajuntament, 1 – Igualada (Barcelona)

Telford & Wrekin Services Limited

United Kingdom

Tratamientos y Recuperaciones Industriales, S.A.

Balmes, 36 Entresuelo – Barcelona

Valoración y Tratamiento de Residuos Urbanos, S.A.

Riu Magre, 6 – P.I. Patada del Cid – Quart de Poblet (Valencia)

Valorización y Tratamiento de Residuos, S.A.

Alameda de Mazarredo, 15-4º A – Bilbao (Vizcaya)

FCC Group - CEE

FCC Hódmezövásárhely Köztisztasági Kft

Agadax s.r.o.

ASMJ s.r.o.

FCC Abfall Service Betriebs GmbH

FCC Austria Abfall Service AG

FCC BEC s.r.o.

FCC Bratislava s.r.o.

FCC Centrum Nonprofit Kft.

FCC Česká Republika s.r.o.

FCC České Budějovice s.r.o.

FCC Dačice s.r.o.

FCC Eko d.o.o.

FCC Entsorga Entsorgungs GmbH & Co. Nfg KG

FCC Environment CEE GmbH

FCC Environment Romania S.R.L.

FCC Freistadt Abfall Service GmbH

Hungary

Czech Republic

Austria

Czech Republic

Slovakia

ungary

Czech Republic

Serbia

Austria

Romania

Austria

41.26

56.26

45.01

75.01

49.44

75.01

56.26

60.01

75.01

46.38

75.01

38.26

75.01

56.26

45.01

75.01

Capital Auditors

Ernst & Young

Vaciero Auditores

Capital Auditors

Vaciero Auditores

Ernst & Young

387

Company

Address/Registered office

% Effective ownership

Auditor

FCC Halbenrain Abfall Service GmbH & Co. Nfg KG

FCC HP s.r.o.

FCC Industrieviertel Abfall Service GmbH & Co. Nfg KG

FCC Inerta Engineering & Consulting GmbH

FCC Kikinda d.o.o.

FCC Liberec s.r.o.

FCC Litovel s.r.o.

FCC Lubliniec sp. z.o.o.

FCC Magyarorzág Kft

FCC Mostviertel Abfall Service GmbH

FCC Neratovice s.r.o.

FCC Neunkirchen Abfall Service GmbH

FCC Podhale sp. z.o.o.

FCC Polska sp. z.o.o.

FCC Pro Eko sp. z.o.o.

FCC Prostějov s.r.o.

FCC Regios a.s.

FCC Slovensko s.r.o.

FCC Tarnobrzeg.sp. z.o.o.

FCC Textil2Use GmbH

FCC Trnava s.r.o.

FCC Únanov s.r.o.

FCC Vrbak d.o.o.

FCC Wiener Neustadt Abfall Service GmbH

FCC Žabčice s.r.o.

FCC Zabovresky s.r.o.

FCC Zisterdorf Abfall Service GmbH

FCC Znojmo s.r.o.

Austria

Czech Republic

Austria

Serbia

República Checa

Poland

Hungary

Austria

Czech Republic

Austria

Poland

Czech Republic

Slovakia

Poland

Austria

Eslovaquia

Czech Republic

Serbia

Austria

Czech Republic

Austria

Czech Republic

75.01

60.01

41.26

36.75

46.48

75.01

56.26

75.00

75.01

44.80

75.01

37.51

49.51

38.26

75.01

60.01

66.76

75.01

37.25

Ernst & Young

Company

FCC Zohor.s.r.o.

FCC Śląsk Sp. z o.o.

Obsed a.s.

Quail spol. s.r.o.

Siewierskie Przedsiebiorstwo Gospodarki Komunalnej sp. z.o.o.

FCC Environment Group (UK)

3C Holding Limited

3C Waste Limited

Allington O & M Services Limited

Allington Waste Company Limited

Anti-Waste (Restoration) Limited

Anti-Waste Limited

Arnold Waste Disposal Limited

BDR Property Limited

BDR Waste Disposal Limited

Darrington Quarries Limited

Derbyshire Waste Limited

East Waste Limited

FCC Environment (Berkshire) Ltd.

FCC Environment (UK) Limited

FCC Environment Limited

FCC Environment Lostock Limited

FCC Lostock Holdings Limited

FCC Recycling (UK) Limited

FCC Waste Services (UK) Limited

FCC Wrexham PFI Holdings Limited

FCC Wrexham PFI Limited

FCC Wrexham PFI (Phase II Holding) Ltd.

Address/Registered office

% Effective ownership

Auditor

388

Slovakia

Poland

Czech Republic

Poland

United Kingdom

63.76

60.01

75.01

45.01

75.01

60.01

75.01

Ernst & Young

389

Company

Address/Registered office

% Effective ownership

Auditor

FCC Wrexham PFI (Phase II) Ltd.

Finstop Limited

Focsa Services (UK) Limited

Hykeham O&M Services Limited

Integrated Waste Management Limited

Landfill Management Limited

Lincwaste Limited

Norfolk Waste Limited

Pennine Waste Management Limited

RE3 Holding Limited

RE3 Limited

T Shooter Limited

Waste Recovery Limited

Waste Recycling Group (Central) Limited

Waste Recycling Group (Scotland) Limited

Waste Recycling Group (UK) Limited

Waste Recycling Group (Yorkshire) Limited

Wastenotts O & M Services Limited

Welbeck Waste Management Limited

WRG (Midlands) Limited

WRG (Northern) Limited

WRG Acquisitions 2 Limited

WRG Environmental Limited

WRG Waste Services Limited

FCC Group - PFI Holdings

FCC PFI Holdings Limited

Green Recovery Group

Allington Energy Networks Ltd.

FCC (E&M) Holdings Ltd.

United Kingdom

75.01

Ernst & Young

75.01

Ernst & Young

38.26

Ernst & Young

390

Address/Registered office

% Effective ownership

Auditor

Company

FCC (E&M) Ltd.

FCC Buckinghamshire Holdings Limited

FCC Buckinghamshire Limited

FCC Buckinghamshire (Support Services) Limited

FCC Energy Holdings Ltd

FCC Energy Limited

FCC Environment (Lincolnshire) Ltd.

FCC Environment Developments Ltd.

Green Energy Finance Solutions Ltd

Green Recovery Projects Ltd

Kent Energy Limited

Kent Enviropower Limited

Wastenotts (Reclamation) Limited

AQUALIA

United Kingdom

Abrantaqua – Serviço de Aguas Residuais Urbanas do Municipio De Abrantes, S.A.

Portugal

Acque di Caltanissetta, S.p.A.

Aguas de Albania, S.A. E.S.P.

Aguas de Aracataca, S.A.S.

Aguas del Sur del Atlántico, S.A. E.S.P.

Aguas de la Península, S.A. E.S.P.

Aguas de la Sabana de Bogotá, S.A. E.S.P.

Aguas de las Galeras, S.L.

Aigües de Vallirana, S.A. Unipersonal

Aqua Campiña, S.A.

Aquaelvas – Aguas de Elvas, S.A.

Aquafundalia – Agua Do Fundäo, S.A.

Aquajerez, S.L.

Aquamag, S.A.S. E.S.P.

Italy

Colombia

Av. Camino de Santiago, 40 – Madrid

Conca de Tremp, 14 – Vallirana (Barcelona)

Blas Infante, 6 – Écija (Sevilla)

Portugal

Cristalería, 24 – Cádiz

Colombia

38.26

30.60

50.78

45.90

48.45

51.00

40.70

51.00

45.90

51.00

Ernst & Young

Oliveira, Reis & Asociados

Ernst & Young

BDO Auditores

Capital Auditors

Ernst & Young

BDO Auditores

391

Address/Registered office

% Effective ownership

Auditor

Company

Aqualia Colombia, S.A.S.

Aqualia Czech, S.L.

Aqualia Desalación Guaymas, S.A. de C.V.

Aqualia Flandes S.A.S. E.S.P.

Aqualia France

Aqualia Gestión Los Cabos SACV

Aqualia Infraestructuras d.o.o. Beograd-Vracar

Aqualia Infraestructuras d.o.o. Mostar

Aqualia Infraestructuras Inzenyring, s.r.o.

Aqualia Infraestructuras Montenegro (AIM) d.o.o. Niksic

Aqualia Infraestructuras Pristina Llc.

Aqualia Intech, S.A.

Aqualia Latinoamérica, S.A.

Colombia

Av. Camino de Santiago, 40 – Madrid

Mexico

Colombia

France

Mexico

Serbia

Bosnia-Herzegovina

Czech Republic

Montenegro

Kosovo

Av. Camino de Santiago, 40 – Madrid

Colombia

Aqualia Mace Contracting, Operation & General Maintenance Llc.

United Arab Emirates

Aqualia Mace Qatar

Aqualia México, S.A. de C.V.

Aqualia Portugal, S.A.

Aqualia Riohacha S.A.S. E.S.P.

Aqualia Villa del Rosario, S.A.

Aquamaior – Aguas de Campo Maior, S.A.

Aquos El Realito, S.A. de C.V.

C.E.G. S.P.A. Simplifiée

Cartagua, Aguas do Cartaxo, S.A.

Compagnie Armoricaine Des Eaux

Compañía Onubense de Aguas, S.A.

Conservación y Sistemas, S.A.

Depurplan 11, S.A.

Ecosistema de Morelos S.A. de C.V.

Qatar

Mexico

Portugal

Colombia

Portugal

Mexico

France

Portugal

France

Av. Martín Alonso Pinzón, 8 – Huelva

Federico Salmón, 13 – Madrid

Madre Rafols, 2 – Zaragoza

Mexico

51.00

26.01

51.00

26.01

51.00

26.01

51.00

30.60

51.00

30.60

51.00

BDO Auditores

Ernst & Young

Baker & Tilly

SNR Audit

Ernst & Young

CMC Audit s.r.o.

Ernst & Young

BDO Auditores

Baker & Tilly

Mazars

Ernst & Young

BDO Auditores

Ernst & Young

SNR Audit

Oliveira, Reis & Asociados

SNR Audit

Ernst & Young

Capital Auditors

CTS Consultores

392

Company

Empresa Gestora de Aguas Linenses, S.L.

Empresa Mixta de Conservación de la Estación Depuradora de Aguas Residuales de
Butarque, S.A.

Entemanser, S.A.

FCC Aqualia, S.A.

FCC Aqualia América, S.A.Unipersonal

FCC Aqualia U.S.A. Corp

Flores Rebollo y Morales, S.L.

Genesis Lodos, S.L.

Haji Abdullah Ali Reza Integrated Services Ltd (H.A.A. & CO. )

Hidrotec Tecnología del Agua, S.L. Unipersonal

Address/Registered office

Federico Salmón, 13 – Madrid

Princesa, 3 – Madrid

Castillo, 13 – Adeje (Santa Cruz de Tenerife)

Av. Camino de Santiago, 40 – Madrid

Uruguay, 11 – Vigo (Pontevedra)

USA

Urbanización Las Buganvillas, 4 – Vera (Almería)

Avda. Kansas City, 9 - Seville

Saudi Arabia

Pincel, 25 – Seville

Infraestructuras y Distribución General de Aguas, S.L.U.

La Presa, 14 – Adeje (Santa Cruz de Tenerife)

Municipal District Services, Llc.

Naunet, S.A.S.

North Cluster S.P.V. Llc.

Qatarat Saquia Desalination

USA

Colombia

Saudi Arabia

Servicios Hídricos Agricultura y Ciudad, S.L.U.

Alfonso XIII – Sabadell (Barcelona)

Severomoravské Vodovody a Kanalizace Ostrava A.S.

Shariket Tahlya Miyah Mostaganem, S.P.A.

Sociedad Española de Aguas Filtradas, S.A.

Sociedad Ibérica del Agua, S.A. Unipersonal

Société des Eaux de Fin d'Oise, S.A.S.

Société Pays de Dreux

South Cluster SPV Llc

Tratamiento Industrial de Aguas, S.A.

Vodotech, spol. s.r.o.

Water Sur, S.L.

Czech Republic

Algeria

Jacometrezo, 4 – Madrid

Federico Salmón, 13 – Madrid

France

Saudi Arabia

Federico Salmón, 13 – Madrid

Czech Republic

Urbanización Las Buganvillas, 4 – Vera (Almería)

% Effective ownership

Auditor

51.00

35.70

49.47

51.00

30.60

40.80

26.01

51.00

49.47

51.00

26.01

51.00

13.01

51.00

22.95

51.00

30.60

Ernst & Young

H&CO

Ernst & Young

BDO Auditores

Ernst & Young

Samir Hadj Ali

Ernst & Young

SNR Audit

Ernst & Young

CMC Audit s.r.o.

393

Company

GGU Group

Aqualia Georgia Llc.

Gardabani Sewage Treatment Plant Llc.

Georgia Global Utilities JSC

Georgian Energy Trading Company Llc.

Georgian Engineering and Management

Georgian Water and Power Llc.

Rustavi Water Llc.

Saguramo Energy Llc.

CONSTRUCTION

ACE Scutmadeira Sistemas de Gestao e Controlo de Tràfego

Agregados y Materiales de Panamá, S.A.

Áridos de Melo, S.L.

Colombiana de Infraestructuras, S.A.S.

Concesiones Viales S. de R.L. de C.V.

Concretos Estructurales, S.A.

Conservial Infraestructuras, S.L.

Consorcio FCC Iquique Ltda.

Construcción Infraestructuras y Filiales de México, S.A. de C.V.

Construcciones Hospitalarias, S.A.

Constructora Meco-Caabsa, S.A. de C.V.

Constructora Túnel de Coatzacoalcos, S.A. de C.V.

Contratas y Ventas, S.A.

Corporación M&S de Nicaragua, S.A.

Desarrollo y Construcción DEYCO CRCA, S.A.

Edificadora MSG, S.A. (Panamá)

Edificadora MSG, S.A. de C.V. (El Salvador)

Edificadora MSG, S.A. de C.V. (Nicaragua)

Address/Registered office

% Effective ownership

Auditor

Georgia

Portugal

Panama

Finca la Barca y el Ballestar, s/n – Barajas de Melo (Cuenca)

Colombia

Mexico

Nicaragua

Federico Salmón, 13 – Madrid

Chile

Mexico

Panama

El Salvador

Mexico

Av. de Santander, 3 1º – Oviedo (Asturias)

Nicaragua

Costa Rica

Panama

El Salvador

Nicaragua

Ernst & Young

Mohsin Hafeji Hajari (CPA)

Capital Auditors

ASTAF Auditores y Consultores

Mohsin Hafeji Hajari (CPA)

Ernst & Young

51.00

40.80

100.00

52.00

100.00

60.00

85.60

100.00

394

Address/Registered office

% Effective ownership

Auditor

Company

FCC Américas, S.A. de C.V.

FCC Américas Panamá, S.A.

FCC Colombia, S.A.S.

FCC Construcción, S.A.

FCC Construcción América, S.A.

FCC Construcción Chile, SPA

FCC Construcción Costa Rica, S.A.

FCC Construcción de México, S.A. de C.V.

FCC Construcción Perú, S.A.C.

FCC Constructii Romania, S.A.

FCC Construction Australia Pty Ltd

FCC Construction Inc.

FCC Construction International B.V.

FCC Construction Ireland DAC

FCC Construction Northern Ireland Limited

FCC Construction Regional Headquarter Llc

FCC Construçoes do Brasil Ltda.

FCC Electromechanical Llc.

FCC Elliott Construction Limited

FCC Industrial de Panamá, S.A.

FCC Industrial Deutschland GmbH

Mexico

Panama

Colombia

Balmes, 36 – Barcelona

Costa Rica

Chile

Costa Rica

Mexico

Peru

Romania

Australia

USA

Netherlands

Ireland

United Kingdom

Saudi Arabia

Brazil

Saudi Arabia

Ireland

Panama

Germany

FCC Industrial e Infraestructuras Energéticas, S.A. Unipersonal

Av. Camino de Santiago, 40 – Madrid

FCC Industrial Perú, S.A.

FCC Industrial UK Limited

FCC Servicios Industriales y Energéticos México, S.A. de C.V.

Peru

United Kingdom

Mexico

FCC Soluciones de Seguridad y Control, S.L.

Federico Salmón, 13 – Madrid

Fomento de Construcciones y Contratas Canadá Ltd.

Impulsora de Proyectos Proserme, S.A. de C.V.

Canada

Mexico

50.00

100.00

50.00

100.00

PH Proaudit Solutions

ASTAF Auditores y Consultores

Ernst & Young

Mazars

Ernst & Young

Mazars

Ernst & Young

Mazars

Ernst & Young

395

Company

Address/Registered office

% Effective ownership

Auditor

Mantenimiento de Infraestructuras, S.A.

Federico Salmón, 13 2a planta – Madrid

Meco Santa Fe Limited

Megaplás, S.A. Unipersonal

Megaplás Italia, S.p.A.

Participaciones Teide, S.A.

Prefabricados Delta, S.A. Unipersonal

Servicios Dos Reis, S.A. de C.V.

CEMENT

Áridos de Navarra, S.A.

Canteras de Alaiz, S.A.

Cementos Alfa, S.A.

Cementos Portland Valderrivas, S.A.

Dragon Alfa Cement Limited

Dragon Portland Limited

Intermonte Investments, S.A.

Prebesec Mallorca, S.A.

Société des Ciments d’Enfidha

Surgyps, S.A.

Tratamiento Escombros Almoguera S.L.

Uniland Acquisition Corporation

Uniland International B.V.

Uniland Trading B.V.

CONCESSIONS

Autovía Conquense, S.A.

Cemark - Mobiliario Urbano e Publicidade, S.A.

Concesionaria Túnel de Coatzacoalcos, S.A. de C.V.

FCC Concesiones Al Ansar, S.A. Unipersonal

FCC Concesiones de Infraestructuras, S.L.

Belize

Hilanderas, 4-14 – La Poveda – Arganda del Rey (Madrid)

Italy

Av. Camino de Santiago, 40 – Madrid

Federico Salmón, 13 – Madrid

Mexico

Estella, 6. Pamplona (Navarra)

Dormilatería, 72 – Pamplona (Navarra)

María Tubau, 9 – 4 planta – Madrid

Dormilatería, 72 – Pamplona (Navarra)

United Kingdom

Paseo de la Castellana, 216 – Madrid

Conradors (P.I. Marratxi) – Marratxi (Baleares)

Tunisia

Paseo de la Castellana, 216 – Madrid

USA

Netherlands

Av. Camino de Santiago, 40 – Madrid

Portugal

Mexico

Federico Salmón, 13 – Madrid

Av. Camino de Santiago, 40 – Madrid

100.00

65.68

69.68

87.63

99.51

87.63

99.51

67.99

87.43

99.51

50.78

99.51

100.00

85.60

100.00

Ernst & Young

Collegio Sindicale

Ernst & Young

% Effective ownership

Auditor

396

Consolidated Group | Notes to the consolidated financial statements | Page 119 of 139

Company

FCC Versia, S.A.

Av. Camino de Santiago, 40 – Madrid

PPP Infraestructure Investments B.V.

Netherlands

Sociedad Concesionaria Tranvía de Murcia, S.A.

Paseo de la Ladera, 79– Murcia

Vialia Sociedad Gestora de Concesiones de Infraestructuras, S.L.

Av. Camino de Santiago, 40 – Madrid

Fedemes, S.L.

REAL ESTATE

Costa Verde Habitat, S.L.

FCyC, S.A.

FCC Real Estate (UK) Limited

Jezzine Uno, S.L. Unipersonal

Realia Group

Boane 2003, S.A. Unipersonal

Guillena Golf, S.L. Unipersonal

Hermanos Revilla, S.A.

Inversiones Inmobiliarias Rústicas y Urbanas 2000, S.L.

Planigesa, S.A.

Realia Business, S.A.

Realia Contesti, S.R.L.

Realia Patrimonio, S.L.U.

Servicios Índice, S.A.

Valaise, S.L. Unipersonal

Vela Borovica Koncern d.o.o.

OTHER ACTIVITIES

Federico Salmón, 13 – Madrid

Av. Camino de Santiago, 40 – Madrid

Federico Salmón, 13 – Madrid

United Kingdom

Av. Camino de Santiago, 40 – Madrid

Paseo de la Castellana, 216 – Madrid

Av. Camino de Santiago, 40 – Madrid

Av. Camino de Santiago,40– Madrid

Av. Camino de Santiago, 40 – Madrid

Romania

Av. Camino de Santiago, 40 – Madrid

Croatia

Asesoría Financiera y de Gestión, S.A.

Federico Salmón, 13 – Madrid

FCC Midco, S.A.

FCC Topco, S.A.R.L.

Luxembourg

Baker & Tilly

Ernst & Young

SW Auditores España

Ernst & Young

100.00

80.03

15.80

53.66

14.03

35.79

40.78

53.66

48.52

53.66

80.03

100.00

397

Annex II Companies jointly controlled with third parties outside the Group

(consolidated using the equity method)

Company

Address/Registered office

ENVIRONMENTAL SERVICES

Atlas Gestión Medioambiental, S.A.

Viriato, 47 – Barcelona

Ecoparc del Besós, S.A.

Av. Torre d'en Mateu. P.I. Can Salvatella s/n – Barcelona

Ecoserveis Urbans de Figueres, S.L.

Av. de les Alegries, s/n – Lloret de Mar (Girona)

Electrorecycling, S.A.

Ctra. BV – 1224 Km. 6,750 – El Pont de Vilomara i
Rocafort (Barcelona)

Empresa Mixta de Limpieza de la Villa de Torrox, S.A.

Plaza de la Constitución, 1 – Torrox (Málaga)

Empresa Mixta de Medio Ambiente de Rincón de la Victoria, S.A.

Barrio Las Zorreras, 8 – Rincón de la Victoria (Málaga)

Fisersa Ecoserveis, S.A.

Alemanya, 5 – Figueres (Girona)

Gestión y Valorización Integral del Centro, S.L.

De la Tecnología, 2. P.I. Los Olivos – Getafe (Madrid)

Ingeniería Urbana, S.A.

Calle l esquina calle 3, P.I. Pla de la Vallonga – Alicante

Mediaciones Comerciales Ambientales, S.L.

Av. Barcelona, 109. P.5 – Sant Joan Despí (Barcelona)

Palacio de Exposiciones y Congresos de Granada, S.A.

Paseo del Violón, s/n – Granada

Pilagest, S.L.

Reciclado de Componentes Electrónicos, S.A.

Ctra. BV – 1224 Km. 6,750 – El Pont de Vilomara i
Rocafort (Barcelona)

Calle El Matorral (Parque Actividades
Medioambientales) – Aznalcóllar (Sevilla)

Servicios Urbanos de Málaga, S.A.

Av. Camino de Santiago, 40 – Madrid

Tratamiento Industrial de Residuos Sólidos, S.A.

Rambla Cataluña, 91 – Barcelona

Zabalgarbi, S.A.

FCC Environment Group (UK)

Beacon Waste Limited

Mercia Waste Management Ltd.

Severn Waste Services Limited

Camino Artigabidea, 10 – Bilbao (Vizcaya)

United Kingdom

Net book value of the portfolio

2023

2022

% Effective
ownership

Auditor

6,559

5,534

167

2,048

342

246

205

576

3,684

943

(3,197)

209

−

483

13,100

13,988

−

7,547

8,398

113

1,742

308

299

217

430

4,251

916

(3,312)

209

37.51

36.75

37.51

25.00

37.51

27.27

37.51

26.25

37.51

Ernst & Young

Castellà Auditors Consultors S.L.P.

Audinfor

Auditoria i Control Auditors S.L.P.

Capital Auditors

Baker & Tilly

Ernst & Young

Hispanobelga Econo-mistas Auditores, S.L.P.

−

50.00

Ernst & Young

1,915

982

15,988

19,131

−

51.00

25.00

22.50

37.51

Castellà Auditors Consultors, S.L.P.

KPMG

Ernst & Young

398

Address/Registered office

Net book value of the portfolio

2023

2022

% Effective
ownership

Auditor

Company

AQUALIA

Aguas de Langreo, S.L.

Aguas de Narixa, S.A.

Aigües de Girona, Salt i Sarrià del Ter, S.A.

Ciutadans, 11 – Girona

Compañía de Servicios Medioambientales do Atlántico, S.A.

Estrada de Cedeira Km. 1 – Narón (La Coruña)

Constructora de Infraestructura de Agua de Querétaro, S.A. de C.V.

México

(2,996)

Alonso del Riesgo, 3–Langreo (Asturias)

Málaga, 11 – Nerja (Málaga)

Empresa Municipal de Aguas de Benalmádena EMABESA, S.A.

Explanada de Tivoli, s/n – Arroyo de la Miel (Málaga)

Girona, S.A.

Travesia del carril, 2 – Girona

HA Proyectos Especiales Hidráulicos S. de R.L. de C.V.

Orasqualia Construction, S.A.E.

Orasqualia for the Development of the Waste Water Treatment
Plant S.A.E.

Orasqualia for Operation and Maintenance S.A.E.

CONSTRUCTION

ACS FCC Canada Inc.

Administración y Servicios Grupo Zapotillo, S.A. de C.V.

Altos del Javier, S.A.

Consorcio Tramo Dos S.A. DE C.V.

Construcciones Olabarri, S.L.

Mexico

Egypt

Canada

Mexico

Panama

Mexico

Ripa, 1 – Bilbao (Vizcaya)

Constructora de Infraestructura de Agua de Querétaro, S.A. de C.V.

Mexico

Constructora Durango Mazatlán, S.A. de C.V.

Constructora Nuevo Necaxa Tihuatlán, S.A. de C.V.

Constructores del Zapotillo, S.A. de C.V.

Ctra. Cabo San Lucas San José, S.A. de C.V.

OHL Co Canada & FCC Canada Ltd. Partnership

Onexpress Transportation Partners INC.

Mexico

Canada

976

564

162

240

829

531

162

296

1,239

1,622

1,292

(52)

9,447

1,393

1,614

1,160

(67)

10,856

24.99

25.50

13.71

24.99

12.50

25.50

17.14

25.25

25.50

Capital Auditors

Kreston Iberaudit

Deloitte

Audinfor

Cataudit Auditors Associats, S.L.

Grant Thornton SC

Gran Thorton

1,229

1,306

25.50

Gran Thorton

−

139

(3,852)

1,057

6,127

−

1,828

−

1,918

−

(393)

126

−

5,969

−

1,641

(9,474)

1,722

−

(69,950)

(70,929)

405

220

50.00

49.00

24.50

51.00

50.00

25.00

Deloitte

Charman Auditores

Deloitte

Grant Thornton SC

399

Company

Address/Registered office

Operaciones y Servicios para la Industria de la Construcción, S.A.
de C.V.

Mexico

Servicios Empresariales Durango-Mazatlán, S.A. de C.V.

Mexico

Net book value of the portfolio

2023

−

132

2022

−

119

% Effective
ownership

Auditor

50.00

51.00

CEMENT

Pedrera de l’Ordal, S.L.

CONCESSIONS

Ibisan Sociedad Concesionaria, S.A.

REAL ESTATE

Realia Group

As Cancelas Siglo XXI, S.L.

MDM-Teide, S.A.

Teide-MDM Quadrat, S.A.

TOTAL VALUE OF CONSOLIDATED COMPANIES USING
THE EQUITY METHOD (JOINT VENTURES)

Ctra. N 340 km. 1229,5 – Subirats (Barcelona)

2,855

2,292

49.65

Ernst & Young

Av. Isidor Macabich, s/n. Sant Rafel de Sa Creu
(Baleares)

10,434

10,925

50.00

Deloitte

Av. Camino de Santiago, 40 – Madrid

38,815

38,622

Panama

176

365

48,724

55,487

Ernst & Young

26.83

40.02

Consolidated Group | Notes to the consolidated financial statements | Page 123 of 139

Annex III Associates (consolidated using the equity method)

Company

Address/Registered office

ENVIRONMENTAL SERVICES

Aprochim Getesarp Rymoil, S.A.

P.I. Logrezana s/n– Carreño (Asturias)

Aragonesa de Gestión de Residuos, S.A.

Paseo María Agustín, 36 – Zaragoza

Aragonesa de Tratamientos Medioambientales XXI, S.A.

Ctra. Castellón Km. 58 – Zaragoza

Betearte, S.A.Unipersonal

Cr. BI – 3342 pk 38 Alto de Areitio – Mallabia (Vizcaya)

Gestión Integral de Residuos Sólidos, S.A.

Serrans, 12 – 14 Ent. 1 – Valencia

Giref Generación Renovable

FCC Group - CEE

A.K.S.D. Városgazdálkodási Korlátolt FT

ASTV s.r.o.

FCC + NHSZ Környezetvédelmi HKft

FCC Hlohovec s.r.o.

Huber Abfallservice Verwaltungs GmbH

Huber Entsorgungs GmbH Nfg KG

Killer GmbH

Killer GmbH & Co KG

Recopap s.r.o.

Tev-Akva Kft.

FCC Environment Group (UK) (*)

CI III Lostock Efw Limited

Lostock Power Limited

Lostock Sustainable Energy Plant Limited

Pedro Lafayo, 6 - Ibiza

Hungary

Czech Republic

Hungary

Slovakia

Austria

Slovakia

Hungary

United Kingdom

Net book value of the portfolio

2023

2022

% Effective
ownership

Auditor

1,439

549

671

5,526

−

7,759

−

44,253

−

1,347

606

413

5,342

7,004

−

24.13

9.00

24.75

25.00

36.75

15.00

19.13

36.75

37.51

36.75

37.51

6.50

30.00

Menéndez Auditores

CGM Auditores, S.L.y Villalba, Envid y Cia.
Auditores, S.L.P.

Grupo de Auditores Públicos

CMT Audit Kft

Rittmann

Lázár Enikő

Deloitte

Consolidated Group | Notes to the consolidated financial statements | Page 124 of 139

Company

FCC Group – PFI Holdings

CI III Lostock Efw Limited

Lostock Power Limited

Lostock Sustainable Energy Plant Limited

Address/Registered office

United Kingdom

Tirme Group

Circulare, S.L.U.

Mac Insular, S.L.

Mac Insular Segunda, S.L.

Tirme, S.A.

AQUALIA

Aguas de Archidona, S.L.

Aguas de Denia, S.A.

Aguas de Guadix, S.A.

Cr. de Sóller Km. 8,2 – Palma de Mallorca
(Balearic Islands)

P.I. Ses Veles, (Cl. Romaní), 2 – Bunyola
(Balearic islands)

Cr. de Sóller Km. 8,2 – Palma de Mallorca
(Balearic Islands)

Ctra. Soller Km. 8,2 Camino de Son Reus – Palma de
Mallorca (Balearic Islands)

Pz. Ochavada, 1 – Archidona (Málaga)

Pedro Esteve, 17– Denia (Alicante)

Plaza Constitución, 1– Guadix (Granada)

Aguas del Puerto Empresa Municipal, S.A.

Aurora, 1 – El Puerto de Santa María (Cádiz)

Aigües de Blanes, S.A.

Canigó, 5 – Blanes (Girona)

Aigües del Segarra Garrigues, S.A.

C/ Mas d’en Colom, 14 – Tárrega (Lleida)

Aigües del Vendrell, S.A.

Codeur, S.A.

Vella, 1 – El Vendrell (Tarragona)

Mayor, 22 – Vera (Almería)

Concesionaria de Desalación de Ibiza, S.A.

Rotonda de Santa Eulalia, s/n – Ibiza (Balearic Islands)

Net book value of the portfolio

2023

−

2022

32,687

−

9,818

9,714

−

387

289

3,918

−

234

3,965

876

−

341

245

3,965

−

287

6,024

832

Constructora de Infraestructuras de Aguas de Potosí, S.A. de C.V.

Mexico

(5,395)

(5,396)

EMANAGUA Empresa Mixta Municipal de Aguas de Nijar, S.A.

Plaza de la Glorieta, 1 – Nijar (Almería)

Empresa Mixta de Aguas de Ubrique, S.A.

Empresa Mixta de Aguas de Jodar, S.A.

Juzgado, s/n – Ubrique (Cádiz)

Pz. España, 1 – Jodar (Jaén)

Empresa Municipal de Aguas de Algeciras, S.A.

Av. Virgen del Carmen – Algeciras (Cádiz)

224

(21)

(165)

322

165

% Effective
ownership

Auditor

Deloitte

30.00

15.00

10.50

Deloitte

11.25

15.00

Deloitte

24.48

16.83

20.40

24.98

8.40

0.52

24.99

14.32

25.50

12.50

24.99

Vaciero Auditores

Blazquez Asociados Auditores

Capital Auditors

Faura-Casas

GM Auditors

Ernst & Young

BDO Auditores

Capital Auditors

Vaciero Auditores

Kreston Iberaudit

402

Company

Address/Registered office

Empresa Municipal de Aguas de Linares, S.A.

Cid Campeador, 7 – Linares (Jaén)

Empresa Municipal de Aguas de Toxiria, S.A.

Plaza de la Constitución – Torredonjimeno (Jaén)

Nueva Sociedad de Aguas de Ibiza, S.A.

Av. Bartolomé Roselló, 18 – Ibiza (Balearic Islands)

Omán Sustainable Water Services SAOC

Operadora El Realito, S.A. de C.V.

Prestadora de Servicios Acueducto El Realito, S.A.de C.V.

Proveïments d’Aigua, S.A.

Sera Q A Duitama E.S.P., S.A.

Suministro de Aguas de Querétaro, S.A. de C.V.

CONSTRUCTION

Oman

Mexico

Astúries, 13 – Girona

Colombia

Mexico

Agrenic Complejo Industrial Nindiri, S.A.

Nicaragua

Agriwater, S.L.U.

Aigües del Segarra Garrigues, S.A.

Cafig Constructores, S.A. de C.V.

Construcciones y Pavimentos, S.A.

C/ Mas d’en Colom, 14 – Tárrega (Lleida)

Mexico

Panama

Constructora de Infraestructuras de Aguas de Potosí, S.A. de C.V.

Mexico

Constructora San José - Caldera CSJC, S.A.

Constructora San José - San Ramón SJSR, S.A.

Constructora Terminal Valle de México, S.A. de C.V.

Desarrollo Cuajimalpa, S.A. de C.V.

Efi Túneles Necaxa, S.A. de C.V.

Euroconcretos de Nicaragua, S.A.

FCC Tarrio TX-1 Construçao Ltda

M50 (D&C) Limited

N6 (Construction) Limited

OHL-FCC GP Canada Inc.

Prestadora de Servicios Acueducto El Realito, S.A.de C.V.

Costa Rica

Mexico

Nicaragua

Brazil

Ireand

Ireland

Canada

Mexico

Net book value of the portfolio

2023

158

105

1,666

383

671

2022

136

1,588

343

644

13,404

11,728

2,757

343

7,562

919

−

1,805

−

(3,273)

(38,413)

−

2,302

136

7,036

3,560

−

1,379

255

−

(3,273)

(38,413)

−

% Effective
ownership

Auditor

Vaciero Auditores

Deloitte

Ernst & Young

GPM Auditors Associats

Deloitte

BDO Auditores

Deloitte

Ernst & Young

Deloitte

24.99

20.40

24.99

7.65

12.50

7.71

15.61

25.51

50.00

25.20

24.68

45.00

50.00

24.50

50.00

14.28

25.00

45.00

40.00

70.00

42.50

50.00

24.50

403

Company

Promvias XXI, S.A.

Roadbridge FCC JV Limited

Servicios CTVM, S.A. de C.V.

Serv. Terminal Valle de México, S.A. de C.V.

CEMENT

Aplicaciones Minerales, S.A.

Canteras y Hormigones VRE, S.A.

Giant Group

Coastal Cement Corporation

Dragon Energy Llc.

Dragon Products Company Inc.

Giant Cement Company

Giant Cement Holding Inc.

Giant Cement NC Inc.

Giant Cement Virginia Inc.

Giant Resource Recovery Inc.

Giant Resource Recovery - Arvonia Inc.

Giant Resource Recovery - Attalla Inc.

Giant Resource Recovery - Harleyville, Inc.

Giant Resource Recovery - Sumter Inc.

Keystone Cement Company

Sechem Inc.

Hormigones Castro, S.A.

Address/Registered office

Anglesola, 6 - Barcelona

Ireland

Mexico

Camino Fuente Herrero - Cueva Cardiel (Burgos)

Berroa (P.I. La Estrella)- Tanojar (Navarra)

USA

Ctra. Nacional 634 - Ambrosero - Barcena de Cicero
(Cantabria)

Hormigones de la Jacetania, S.A.

Llano de la Victoria – Jaca (Huesca)

Hormigones del Baztán, S.L.

Hormigones Delfín, S.A.

Berroa (P.I. La Estrella) - Tanojar (Navarra)

Venta Blanca - Peralta (Navarra)

Net book value of the portfolio

2023

2022

% Effective
ownership

Auditor

−

596

(297)

−

540

(281)

102,744

13,451

−

407

813

377

1,057

−

446

782

396

911

25.00

50.00

14.28

34.40

49.76

44.78

49.76

62.20

49.76

Mazars

KPMG

404

Company

Address/Registered office

Hormigones en Masa de Valtierra, S.A.

Ctra. Cadreita Km. 1 - Valtierra (Navarra)

Hormigones Reinares, S.A.

Pintor Murillo, s/n - Calahorra (La Rioja)

Hormigones y Áridos del Pirineo Aragonés, S.A.

Ctra. Nacional, 260 Km. 516,5- Sabiñánigo (Huesca)

Lázaro Echevarría, S.A.

Navarra de Transportes, S.A.

Novhorvi, S.A.

Portcemen, S.A.

P.I. Isasia- Alsasua (Navarra)

C/Circunvalación Inguraketa s/n - Olazagutia (Navarra)

Portal de Gamarra, 25 - Vitoria -Gasteiz (Alava)

Muelle Contradique Sur-Puerto Barcelona - Barcelona

Terminal Cimentier de Gabes-Gie

Tunisia

Vescem-LID, S.L.

CONCESSIONS

Future Valleys Project Co Limited

Future Valley Hold Co Limited

Metro de Lima Línea 2, S.A.

Valencia, 245 - Barcelona

United Kingdom

Peru

World Trade Center Barcelona, S.A. de S.M.E.

Moll Barcelona (Ed. Este), s/n – Barcelona

REAL ESTATE

Las Palmeras de Garrucha, S.L.

Metrovacesa, S.A.

TOTAL VALUE OF CONSOLIDATED COMPANIES USING
THE EQUITY METHOD (ASSOCIATED COMPANIES)

Mayor, 19 – Garrucha (Almería)

Calle Quintanavides (PQ. Via Norte), 13 28050 Madrid

402,120

670,460

165,768

(*) In 2023, CI III Lostock Efw Limited, Lostock Power Limited and Lostock Sustainable Energy Plant Limited were transferred from the FCC Group - PFI Holdings to FCC Environment (UK).

Net book value of the portfolio

2023

2,514

1,050

6,317

7,828

825

979

29,010

−

38,840

11,521

828

2022

2,419

985

6,112

8,011

679

1,040

29,688

−

37,310

10,399

955

−

% Effective
ownership

Auditor

KPMG

Goodman Jones

Ernst & Young

39.81

49.76

27.87

33.17

33.10

29.14

24.83

42.50

18.25

24.01

16.01

16.98

Consolidated Group | Notes to the consolidated financial statements | Page 128 of 139

Annex IV Changes in the scope of consolidation

ADDITIONS

Company

GLOBAL CONSOLIDATION

Allington Energy Networks Ltd.

Aqualia Riohacha S.A.S. E.S.P.

FCC Construction Regional Headquarter Llc

FCC Environnement France

FCC Industrial Deutschland GmbH

Municipal District Services, Llc.

North Cluster S.P.V. Llc.

Resicorreia Gestao Ser Amb Lda

Société Pays de Dreux

ASSOCIATES

Metrovacesa, S.A.

Address/Registered office

United Kingdom

Colombia

Saudi Arabia

France

Germany

USA

Saudi Arabia

Portugal

France

Calle Quintanavides (PQ. Via Norte), 13 28050 Madrid

DERECOGNITIONS

Company

GLOBAL CONSOLIDATION

FCC Edificadora CR, S.A. (3)

FCC Environmental Services Limited (1)

FCC Inmobilien Holding GmbH (4)

PROPORTIONA

Address/Registered office

Costa Rica

United Kingdom

Germany

Abastament en Alta Costa Brava Empresa Mixta, S.A. (1)

Pz. Josep Pla Casadevall, 4 3º 1ª. Girona

JOINT VENTURES

Constructora Nuevo Necaxa Tihuatlán, S.A. de C.V. (2)

Mexico

Elaboración de Cajones Pretensados, S.L. (3)

Av. Camino de Santiago, 40 – Madrid

Servicios Urbanos de Málaga, S.A. (1)

Av. Camino de Santiago, 40 – Madrid

(1) Derecognition by liquidation
(2) Derecognition following disposal of the holding
(3) Derecognition by dissolution
(4) Derecognition due to absorption

Consolidated Group | Notes to the consolidated financial statements | Page 129 of 139

406

Annex V Temporary joint ventures, economic interest groups and other enterprises managed

jointly with non-Group third parties

Integration percentage
at 31 December 2023

ENVIRONMENTAL SERVICES

A Coruña Limpieza JV

Agarbi JV

Agarbi Bi JV

Agarbi Interiores JV

Aizmendi JV

Alcantarillado Melilla JV

Arazuri 2020 JV

Arcos JV

Arcos Limpieza Viaria JV

Artigas JV

ARUCAS II JV

Baix Ebre-Montsià JV

Berango JV

Bilketa 2017 JV

Bio Eraikigarbi JV

Biocompost de Álava JV

Bizkaiko Hondartzak JV

Bizkaiko Hondartzak 2021 JV

Boadilla JV

Cabrera de Mar JV

Cana Putxa JV

Carma JV

70.00

60.00

50.00

51.00

60.00

70.00

60.00

50.00

20.00

50.00

Castellana – Po JV

Chipiona JV

CMG2 Lanak JV

CMG2 Kudeaketa JV

Complejo Ambiental Copero JV

Compostaje MCP JV

Contenedores las Palmas JV

Contenedores Madrid JV

Contenedores Madrid 2 JV

CTR – Vallès JV

Ctr. de l’alt Empordà JV

CTR Valladolid JV

Cua JV

Dependencias Elche JV

Donostiako Garbiketa JV

Dos Aguas JV

Ecogondomar JV

Ecomilla Bicipark JV

Ecoparc 3 BCN JV

Ecoparque Cáceres JV

Ecourense JV

Eco-Tri JV

Efic. Energ. JV Puerto del Rosario JV

50.00

92.00

67.00

50.00

30.00

38.25

36.50

20.00

45.00

80.00

50.00

80.00

70.00

35.00

70.00

60.00

50.00

60.00

Consolidated Group | Notes to the consolidated financial statements | Page 130 of 139

407

Integration percentage
at 31 December 2023

Elche JV

Electrificación SAC JV

Energía Solar Onda JV

Enllumenat Sabadell JV

Envases Ligeros Málaga JV

Epeleko Konposta JV

Epremasa Provincial JV

Eretza JV

Es Vedra JV

Etxebarri JV

FCC - Ers Los Palacios JV

FCC Perica I JV

FCC - SuFI Majadahonda JV

FCC-Mcc Santiago del Teide JV

F.S.S. JV

Fuentes las Palmas JV

Fuerteventura Lote 2 JV

Gestió Integral de Runes del Papiol JV

Gestión Instalación III JV

Giref JV

Goierri Bilketa JV

Goierri Garbia JV

Guipuzkoako Hondartzak 2020 JV

Guipuzkoako Hondartzak 2022 JV

Guipuzkoako Portuak 2019 JV

Industriales Lea Artibai JV

Bilbao Interiors JV

50.00

25.00

50.00

60.00

55.00

70.00

25.00

60.00

50.00

60.00

50.00

80.00

99.00

25.00

50.00

40.00

34.99

20.00

60.00

40.00

60.00

80.00

Bilbao Interiors II JV

Jardineras 2019 JV

Jardines Boadilla JV

Jardines Pto del Rosario JV

Jardines UJI JV

Jard. Universitat Jaume I JV

Jerez JV

JJ Gaiketa Sanmarko JV

Jundiz II JV

Kimeketak Bi JV

la Lloma del Birlet JV

Lagunas II JV

Las Caldas Golf JV

Legio VII JV

Lekeitioko Mantenimendua JV

Lezo Garbiketa 2018 JV

Limpieza Santa Coloma JV

Limpieza y RSU Lezo JV

Logroño Limpio JV

Los Rosales - Zafra JV

Luze Vigo JV

LV Coslada JV

LV Lote IV JV

LV Ribera JV

LV RSU Muszik JV

LV RSU Vitoria-Gasteiz JV

LV Zumaia JV

70.00

60.00

70.00

78.00

50.00

80.00

63.00

51.00

50.00

80.00

33.34

50.00

60.00

55.00

50.00

55.00

50.00

45.00

40.00

50.00

65.00

90.00

60.00

Consolidated Group | Notes to the consolidated financial statements | Page 131 of 139

408

Integration percentage
at 31 December 2023

LV Zumarraga JV

Mant. Build. Diputación Vcia

Mant. Edificios Valencia JV

Manteniment Lot 12 JV

Mantenimiento Reg Cornellà JV

Melilla JV

Muskiz JV

Neteja Illes Balears JV

Neteja i Recollida Anglès JV

Neteja Pintades Barcelona JV

Netial JV

Neumática Casco Antiguo JV

Nivaria JV

Onda Exploitation JV

Pájara JV

Pamplona JV

PaP La Cellera JV

Parla JV

Parques Infantiles LP JV

Plan Residuos JV

Planta Materia Orgánica JV

Planta Rsi Tudela JV

Planta Transferencia FTV 2 JV

Planta Tratamiento Valladolid JV

Playas Gipuzkoa III JV

Poniente Almeriense JV

Portmany JV

60.00

55.00

75.00

60.00

50.00

60.00

50.00

84.20

66.66

65.00

29.00

33.33

70.00

80.00

50.00

47.50

40.00

60.00

70.00

90.00

55.00

50.00

JV PTMR

Puerto de Pto del Rosario JV

RBU Els Ports JV

RBU Villa-Real JV

Rec. Neum. Valdespartera JV

Recollida Segrià JV

Reg Cornellà JV

Reutiliza JV

RSU Bilbao II JV

RSU Chipiona JV

RSU Donosti JV

RSU Inca JV

RSU LV Muskiz JV

RSU LV S. Bme. Tirajana JV

RSU y LV Colmenar Viejo JV

RSU y LV Torrejón de Ardoz JV

RSU Málaga JV

RSU Sestao JV

RSU Tolosaldea JV

S.U. Alicante.

S.U. Benicassim

S.U. Bilbao

S.U. Oropesa del Mar

Saneamiento Urbano Castellón JV

Saneamiento Vitoria-Gasteiz JV

Sanejament Cellera de Ter JV

Sanejament Girona JV

50.00

70.00

50.00

47.00

49.00

60.00

70.00

60.00

50.00

70.00

80.00

60.00

50.00

60.00

50.00

60.00

33.33

35.00

60.00

35.00

65.00

60.00

50.00

70.00

Consolidated Group | Notes to the consolidated financial statements | Page 132 of 139

409

Integration percentage
at 31 December 2023

Sanejament Granollers JV

San Miguel-Anaka JV

SAV – FCC Tratamientos JV

Selectiva Urola Kosta II 2017 JV

Selectiva las Palmas JV

Selectiva Sanlucar JV

Selectiva San Marcos II JV

Selectiva Urola Kosta JV

Sellado Vertedero Gardelegui JV

Son Espases JV

Tolosako Garbiketa JV

Tolosako Garbiketa 2020 JV

Tolosaldea RSU 2018 JV

Tolosaldea RSU 2023 JV

Transp. y Elim. RSU

Transporte RSU JV

Txorierri RSU 2023 JV

Uribe Kosta JV

Urola Erdia JV

Urola Kosta 2023 JV

Urretxu Garbi 2023 JV

Urretxu Garbiketa JV

Vertedero Gardelegui III JV

Vertresa JV

Vidrio Melilla JV

Vilomara II JV

Zamora Limpia JV

80.00

50.00

35.00

60.00

55.00

50.00

63.00

60.00

50.00

40.00

60.00

33.33

60.00

70.00

10.00

50.00

33.33

30.00

Zaragoza Delicias JV

Zarautz Garbia JV

Zarauzko Garbiketa JV

Zumaia JV

Zumarraga Garbia JV

ZZVV Santa Cruz Tenerife JV

AQUALIA

Aguas y Servicios de la Costa Tropical de Granada, A.I.E.

Empresa Mixta de Aguas y Servicios, S.A.

Gestión de Servicios Hidráulicos de Ciudad Real, A.I.E.

Consortium O&M Alamein

Abastecimiento Picadas Almoguera JV

Abu Rawash Construccion JV

Aguas Alcalá JV

UTE Aguas del Doramás

JV Alkhorayef-FCC Aqualia

Ampliación Edam Granadilla JV

Expansion SWDP Melilla JV

UTE Badajoz Zona Este

UTE Badajoz Zona Oeste

UTE Cap Djinet

UTE Cons. Gestor Ptar Salitre

UTE Costa Tropical

UTE Costa Tropical II

UTE Costa Tropical III

Depuración Poniente Almeriense JV

Depuradoras Lote 1 JV

51.00

60.00

50.00

51.00

75.00

65.00

95.00

50.00

51.00

60.00

50.00

30.00

51.00

75.00

95.00

Consolidated Group | Notes to the consolidated financial statements | Page 133 of 139

410

Integration percentage
at 31 December 2023

Edar A Guarda 2013 JV

Edar A Guarda 2022 JV

Edar Baeza JV

Edar Galindo JV

Edar Gijón JV

Garrucha JV

JV Gestión Cangas

UTE Groupement Solidaire Jerba

Guadiana Pueblonuevo JV

Hidc - Hidr. – Inv Do Centr. Ace JV

UTE Ibiza

SWDP Santa Eulalia JV

Idam Santa Eulalia II JV

Idam Santa Eulalia III JV

Idam Santa Eulalia IV JV

UTE Idga Saneca

UTE Louro

Mantenimiento Red Alc.6 JV

UTE Mostaganem

Obra Edar Argamasilla de Calatrava JV

OYM CAP Djinet JV

JV OYM Mostaganem

Ptar Ambato JV

Qatar JV

SEAFSA Lanzarote JV

Sollano-Zalla JV

50.00

60.00

85.00

70.00

50.00

51.00

50.00

70.00

65.00

99.01

50.00

70.00

50.00

60.00

51.00

60.00

50.00

JV TSE Riad

UTE Zafra

CONSTRUCTION

ACE Caet XXI Construçoes

Consorcio Cobra – FCC Industrial

Consorcio FCC Construcción-Ferrovial Agroman Ltda.

Fast Consortium Limited LLC

Lúcios & FCC Construcción, A.C.E

ACP du Port de la Condamine

Asoc. Astaldi-FCC-Salcef-Thales, Lot 2 A

Asoc. Astaldi-FCC-Salcef-Thales, Lot 2 B

Asoc. FCC Azvi Straco S. Atel-Micasasa

Asocierea FCC-Astaldi-Convensa, Tronson 3

Associate FCC Azvi S. Sighisoara - Atel

Bridging Pennsylvania Constructors JV

CJV-UJV

Consorcio Antioquía al Mar

Consorcio Centenario de Panamá Sociedad Accidental

Consorcio Chicago II

Consorcio CJV Constructor Metro Lima

Consorcio Epc Metro Lima

Consorcio FCC-FI

Consorcio FCC – Corredor de las Playas

Consorcio FCC – Corredor de las Playas II

Consorcio FCC-JJC (Puerto Callao)

Consorcio Ica – FCC – Meco Pac-4

51.00

65.00

50.00

43.00

50.00

43.78

50.00

45.00

49.50

55.00

50.50

55.00

50.00

43.78

40.00

50.00

60.00

25.50

18.25

50.00

51.00

50.00

43.00

Consolidated Group | Notes to the consolidated financial statements | Page 134 of 139

411

Integration percentage
at 31 December 2023

Consorcio Línea 2

Consorcio Línea 2 Ramal

Consorcio Línea Uno

Consorcio M&S Santa Fe Mca

Consorcio Nueva Esperanza

Fast 5 – U.J.V.

FCC - GMK - CCN CLUJ NAPOCA J.V.

FCC - Yuksel – Archidoron – Petroserv J.V.

FCS Tunnels JV

Groupement FCC - Ingenium

J.V. Asocierea Arad-Timisoara FCC-Webuild

J.V. Astaldi-FCC-UTI-Activ. Magistrala

J.V. Bypass Constata

J.V. Centure Otopeni Overpass

J.V Estension of Line 2 to Antohoupoli

J.V. SFI Leasing Company

Merseylink Civil Contractors J.V.

Metro Bucarest J.V.

Onexpress Civils Contractors GP

Scarborough Transit Connect GP

Shimmick Co. Inc. FCC Co. Impregilo Spa JV

Sisk FCC Gg Ppp

Sotra Link Construction JV ANS

Thv Cafasso Construction

TJV-UJV

Webuild – FCC JV (Basarab)

40.00

45.00

50.00

63.00

34.65

50.00

40.00

93.00

50.00

37.00

50.00

40.00

50.01

30.00

33.33

47.50

50.00

30.00

50.00

35.00

50.00

19.70

50.00

2nd Phase Sphinx Dam JV

Accesos a La Estación de La Sagrera JV

Acceso Norte A Vigo Nueva Estación JV

Acceso Puerto Seco Monforte JV

Adecuación Palacio Justicia TSJCV JV

Adif Bancada 2018 JV

Adolfo Suárez Airport JV

Aguas Madrid 2021 JV

Alameda de Cervantes en Lorca JV

Alta Capacidad 2020 JV

Alumbrado Lugo JV

Alumbrado Madrid Lote-1 JV

Am Boadilla JV

Ampliación Hospital Marina Baixa JV

Ampliación Materno Infantil JV

Ampliación Muelle de Naos JV

Andenes L1-L9 Tram Benidorm JV

Arquitectura Sagrera JV

Arroyo del Fresno JV

Aucosta Conservación JV

Auditorio de Lugo JV

Autovía el Batán – Coria JV

Ave Alcántara-Garrovillas JV

Ave Eje Sur JV

Ave Girona JV

Ave Madrid Noreste Lote 2 JV

35.00

37.50

50.00

63.00

50.00

70.00

60.00

50.00

25.00

60.00

80.00

95.00

65.00

37.50

50.00

85.00

25.00

40.00

25.00

Consolidated Group | Notes to the consolidated financial statements | Page 135 of 139

412

Integration percentage
at 31 December 2023

Ave Maside JV

Ave Plasencia - Badajoz JV

Avenoreste1 JV

Avenoreste2 JV

Badajoz Sur JV

Balastro R-3 JV

Barbados JV

Barcience JV

Belltall JV

Bergara Antzuola JV

Bobadilla - Ronda JV

Boetticher Clima JV

Boetticher Electricidad JV

Bombeo Fuente Alamo JV

Bosque de la Herrería JV

Brazatortas JV

By Pass Mérida Lote 1 JV

By Pass Mérida Lote 2 JV

C&F Jamaica JV

Cáceres Norte JV

Calders-Vilaseca JV

Campo Gibraltar JV

Canal de Castilla 2022 JV

Cárcel Marcos Paz JV

Carretera Ibiza - San Antonio JV

Castellón - Vinaroz JV

67.00

25.00

50.00

40.00

71.50

45.00

50.00

60.00

40.00

33.34

50.00

20.00

80.00

70.00

35.00

50.00

Castuera JV

Catlántico JV

Cecoex JV

Cedillo I and II JV

Chuac JV

Cierre Anillo Insular Tfe JV

Circuito JV

Circunvalación Lucentum JV

Ciudad Rodrigo JV

Ciutat de la Justícia JV

CMS La Llagosta JV

CMS Ramal Aeropuerto BCN JV

Coberta Tallers ZF JV

Conexión Corredor Mediterráneo JV

Conexión Molinar JV

Conservacion Ex-A1 JV

Conservacion Plasencia JV

Conservación Telde JV

Construcción Tranvía Zaragoza JV

Control JV

Control Mogán JV

Club de Mar Mallorca JV

Creaa JV

Deancentro JV

Deansur JV

Depuración San Roque JV

33.34

25.00

20.00

99.00

50.00

85.00

70.00

50.00

99.00

30.00

20.00

25.00

50.00

40.00

70.00

50.00

80.00

33.33

70.00

50.00

60.00

Consolidated Group | Notes to the consolidated financial statements | Page 136 of 139

413

Integration percentage
at 31 December 2023

Desarrollo Puerto de Avilés Fase I JV

Dique Este JV

Dique Torres JV

Donostialdea 2018 JV

Donostialdea 2023 JV

Duplicación R-3 JV

Elec Lin Castellón Vinaroz JV

Electrification La Sagrera JV

ErtMS Rodalíes Bcn JV

Estación Girona JV

Estacions Line 9 JV

Ezkio Itsaso JV

Facultad de Filosofía JV

Fase II Pabellón Reyno de Navarra JV

FCC Industrial - Aton JV

FCCi-Orbe JV

F.I.F. GNL FB 301/2 JV

Fira P.Zero JV

Fuente de Cantos JV

FV Tallers Zona Franca JV

Galibos Monforte JV

UTE Galindo-Beurko

Girona Norte 2014 JV

Guadalmez - Córdoba JV

Guadarrama 3 JV

Guadarrama 4 JV

80.00

35.00

27.00

60.00

50.00

22.00

40.00

33.00

40.00

60.00

50.00

90.00

70.00

35.96

60.00

50.00

60.00

70.00

25.00

33.33

Hornachuelos y Antequera Lote 2 JV

Hospital Alcázar JV

Hospital Cabueñes Fase I JV

Hospital Campus de la Salud JV

Hospital del Sur, Segunda Fase JV

Hospital FCC - Vvo JV

Hospital Son Dureta JV

Hospital Universitario de Murcia JV

Lecisa-FCC/Interfonia En Estaciones JV

Impermeabilización Túnel Pajares Norte JV

Instalación FV Balsa Alfés JV

Instalaciones Madrid Este JV

Instalaciones Urbanas Este JV

Jabugo JV

Juan Grande JV

L1 Sur Lote 1 JV

Lac la Sagrera JV

Línea 9 JV

Lote 1 Centro JV

Lote 1 Edif. B Son Dureta JV

Lot 5 Glories JV

Lote 4 Hospital de Alcañiz JV

Lote 6 Sur JV

M-407 JV

Madrid Sevilla Ave JV

Mantenimiento Presas de Castellón JV

25.00

60.00

70.00

80.00

40.00

80.00

33.00

50.00

46.25

50.00

33.00

50.00

70.00

37.50

55.00

50.00

60.00

50.00

Consolidated Group | Notes to the consolidated financial statements | Page 137 of 139

414

Integration percentage
at 31 December 2023

Manteniment Rondes 2022 JV

Mantenimiento Júcar JV

Mantenimiento SAIIH Jucar 2023 JV

Mantenimiento Tdm 2018 JV

Mantenimiento Tranvía Zaragoza JV

Mantenimiento Vía Aranjuez JV

Maquinaria Pesada 2015 JV

Medina 2023 JV

Medinaceli JV

Mej. Viarios Leganés 2022 JV

Metro Línea 12 JV

Miv Centro JV

Miv Centro 2021-2022 JV

Miv Sur JV

Miv Sur Lot 6 JV

Mntto. Antequera Granada JV

Montcada JV

Monforte JV

Montaje Vía Mollet – Girona JV

Monaje Via Sagrera JV

Mora - Calatrava JV

Mto Postr Tajo-Segura JV

Muelle de la Química JV

Murcia JV

Navalmoral JV

Nuevo Estadio Vcf JV

50.00

22.40

50.00

95.00

19.00

25.00

29.50

25.00

20.00

33.33

24.00

50.00

37.50

39.97

60.00

70.00

40.00

55.00

49.00

Nuevo Hospital de Cáceres JV

Nuevo Puerto de Igoumenitza JV

Obra Cub.Capat.Catarroja JV

Obras Alumbrado Madrid JV

Operadora Termosolar Guzmán JV

Osorno 2019 JV

Pago de Enmedio JV

Palacio de Congresos de León JV

Parque Tecnológico JV

Pasaia Berri JV

Pasaia Berri Instalaciones JV

Pizarro JV

Pla de Na Tesa JV

Pont de Candi JV

Ponts Ronda Litoral JV

Presa Enciso JV

Prim Barrio San Anton – Elche JV

Psir Castro Urdiales JV

Puente del Rey JV

Puente Ribadesella JV

Puente Río Ozama (Dfc-Cocimar) JV

Puerto de Granadilla JV

Puertollano JV

Quintanaortuño - Montorio JV

Radiales JV

Red Arterial Palencia Fase I JV

50.00

55.00

50.00

67.50

60.00

75.00

50.00

60.00

50.00

80.00

99.00

70.00

75.00

50.00

80.00

50.00

33.33

70.00

35.00

50.00

75.00

35.00

80.00

Consolidated Group | Notes to the consolidated financial statements | Page 138 of 139

415

Integration percentage
at 31 December 2023

Reforma Chuac Fase Cero JV

Reforma Plaza España JV

Regadíos Río Flumen JV

Rehabilitación Dique Botafoc JV

Rehabilitación Parque la Gavia JV

Renovación Desvíos Fase 1 JV

Renovación Linea Girona-Figueres JV

Rep Pant Brazatortas JV

RIV GIJÓN-LAVIANA JV

RIV Orense - Monforte JV

Ruta Nacional Haití JV

Sagunto JV

Saneamiento Arco Sur JV

Saneamiento de Villaviciosa JV

Santa Maria D’oló-Gurb JV

Serv. Energ. Piscina Cub. S. Caballo JV

Sevilla Huelva Lote 1 JV

Sevilla Huelva Lote 2 JV

Sevilla Huelva Lote 3 JV

Sica JV

Sistemas Tunel Plaza de España JV

Sotiello JV

Ssaa Ap - 7 JV

Tagus II IIII y IV JV

Tanque de Tormentas JV

TF-5 2ª FASE JV

50.00

80.00

60.00

55.00

75.00

25.00

50.00

25.00

40.00

33.33

55.00

60.00

56.50

80.00

60.00

50.00

60.00

50.00

99.00

70.00

Torre Don Jimeno JV

Toses JV

Totana - Totana JV

Tramvia Lot 4 JV

Tratamientos Selvícolas 2020 JV

Traviesas Madrid Sevilla JV

TS Villena JV

Túnel Aeroport JV

Túnel de Folgoso JV

Túnel de Pajares 1 JV

Túnel Fira JV

Túneles Bolaños JV

Túneles de Guadarrama JV

Túneles de Sorbes JV

UBA CYL 2023 JV

Urb. Fase 3 Mahou-Calderón JV

Urbanización Parc Sagunt JV

Urbanizacion Vara del Rey JV

Urbanización Via Parque Tramo Av. Carb.-P JV

Vandellós JV

Velilla Sur JV

Vertedero Castañeda JV

Vía Pajares JV

Viaducto Quisi JV

Vigo-Das Maceiras JV

Vilariño (Via izquierda) JV

50.00

70.00

50.00

60.00

25.00

88.00

49.00

60.00

50.00

49.00

47.50

33.33

67.00

25.00

80.00

50.00

57.50

60.00

24.00

99.00

62.50

50.00

65.00

50.00

90.00

Consolidated Group | Notes to the consolidated financial statements | Page 139 of 139

416

Villanueva - Brazatortas JV

Xarxa Control JV

Yeltes JV

Yesa JV

Zafra Huelva JV

Zaramillo - Bilbao JV

CEMENT

G.R.C.S.A. - AUSA- OLERDOLA JV

CONCESSIONS

Mel 9 JV

B-25 JV

REAL ESTATE

F C y C Harri Iparra JV

Sagunto Parcela M17-3 JV

Integration percentage
at 31 December 2023

45.00

50.00

75.00

33.33

50.00

35.00

60.00

49.00

50.00

Management Report
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND SUBSIDIARIES at 31 December 2023

1. Status of the entity

2. Business performance and results

3. Liquidity and capital resources

4. Major risks and uncertainties

5. Acquisition and disposal of own shares

6. Significant events occurring after the end of the year

7. Outlook

8. R&D+I Activities

9. Other relevant information. share performance and other information

10. Definition of alternative performance measures according

to ESMA Regulations (2015/1415en)

11. Annual Corporate Governance Report

12. Annual Directors' remuneration Report

418

422

440

442

443

447

452

457

Consolidated Group | Management Report | Page 1 of 46FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportConsolidated Group | Management Report | Page 2 of 46

418

1. Status of the entity

The Administration area directs the administrative management of the Group, and has, among others,
the following functions in relation to the Information and Internal Control Systems:

1.1. Status of the entity: Organisational structure
and decision-making process in management

The Group's organisational structure is based on a first level consisting of Areas, which are divided into
two main groups: operational and functional.

The operating Areas include all those activities related to the productive line. The following operating areas
exist within the Group, as discussed in more detail in note 1 of the Notes to the consolidated financial
statements, and also in section 1.3 of the Non-Financial Information Statement:

i. General accounting

ii. Accounting standardisation

iii. Consolidation

iv. Tax advice

v. Tax procedures

vi. Tax compliance

vii. Administrative procedures

i. Environmental Services

ii. End-to-end Water Management

iii. Construction

iv. Cement Business

v. Concessions

vi. Real Estate

Each of these operating Areas is headed by one or more specialised companies which, depending on FCC,
encompass the Group's activities.

In addition, there are the functional Areas, which carry out support tasks for the operational ones:

1) Administration and Finance: the Administration and Finance Division comprises the Administration,
Taxation, Information Technologies, Finance, Communication, Purchasing and Human Resources
areas.

Internal Audit and Risk Management: its objective is to provide the Audit and Control Committee and
Senior Management with an independent and objective opinion on the Group's ability to achieve its
objectives through a systematic and methodological approach for the assessment, management and
effectiveness of internal control and risk management processes, assessing the effectiveness and
reasonableness of the internal control systems, as well as the functioning of processes according
to the procedures, proposing improvements and providing methodological support to the Division
in the process of identifying the main risks that affect activities and supervising the actions for their
management.

3) General Secretary: reporting directly to the Group's CEO, its main duty is to support the management
of the Group, as well as management support for the heads of the other areas of the Group, by
providing the services detailed in the corresponding sections of the divisions and departments that
make up the Group, which are promoted and supervised by the General Secretary.

It is made up of the following areas: Legal Advice Department, Quality Management, Corporate
Security and General Services and Corporate Responsibility.

The Areas, on a second level, can be divided into Sectors, the operational ones, and Divisions, the
functional ones, establishing areas that allow greater specialisation when considered necessary.

The structure of the main decision-making bodies is set out below:

• Board of Directors: is the body that holds the broadest powers, without any limitation, except those
that are expressly reserved, by the Spanish Corporate Enterprises Act or the Articles of Association,
for the jurisdiction of the General Shareholders' Meeting.

419

• Audit And Control Committee: its main function is to support the Board of Directors in its

supervisory duties by periodically reviewing the process for preparing economic and financial
information, its internal controls and the independence of the external auditor.

environmental services. The various services provided in this sector include treatment and recycling,
disposal, waste collection and the generation of renewable energy, with a growing weight and gradual
reduction of disposal in controlled landfills.

• Appointments and Remuneration Committee: supports the Board of Directors in relation to

proposals for the appointment, re-election, ratification and removal of Directors, establishes and
controls the policy for the remuneration of the company's Directors and senior managers and the
fulfilment of their duties by Directors, particularly in relation to situations of conflict of interest and
related-party transactions.

• Managing Committee: each of the business units has a Managing Committee with similar duties.

Further information on the duties of the Group's decision-making bodies is provided in Section 1 of the
Internal Financial Reporting Control System (IFRS) and in Section 1.4 of the Non-Financial Information
Statement.

1.2. Status of the entity:

Business model and company strategy

The Group is one of the leading European groups specialising in the environment, water, infrastructure
development and management, with a presence in over 30 countries worldwide and nearly 47,5% of its
turnover generated in international markets, mainly Europe (28,6%), Latin America (7.7%), the United States
(4.6%), the Middle East (3%) and North Africa (1.4%).

Environmental Services

FCC Medio Ambiente has a strong presence in Spain, and has maintained a leading position in the
provision of urban environmental services for over 120 years.

The Group provides environmental services in more than 3,500 municipalities and organisations in all the
Autonomous Communities, serving a population of more than 31 million inhabitants. Waste collection
and street cleaning are two of the most important services, representing 63% of revenue. They are
followed, in order of importance, by disposal of wastes with 12%, cleaning and maintenance of buildings,
parks and gardens and, to a lesser extent, sewage. More than 85% of the activity is carried out with public
clients

In the United Kingdom, the entire municipal waste management chain is operated, with a particular
emphasis on the recycling and recovery process, including thermal recovery, of products and by-products,
subject to maximum environmental sustainability criteria. It boasts more than 200 recycling facilities
throughout the country and more than 100 MW of installed renewable capacity.

In Central Europe, the Group provides services in seven countries (Austria, Czech Republic, Slovakia,
Poland, Hungary, Romania and Serbia) to a total population of 4.4 million inhabitants, 1,415 municipalities
and more than 51,400 industrial customers. FCC is one of the main four private operators in Austria, the
Czech Republic and Slovakia. In Poland, the rapid growth in the last few years is particularly noteworthy,
although there is still some way to go. In Hungary, Romania and Serbia, the Company's presence is more
discreet while waiting for legislative and regulatory changes to be introduced that guarantee greater
security and stability in operations in these countries.

The range of services provided and the geographic dispersion is very diverse and balanced, including
municipal and industrial collection, incineration, mechanical and biological treatment, decontamination
of soils, spills, snow collection, street cleaning, classification and management of recycled materials,
outsourcing , cleaning of buildings, etc. This broad diversification ensures great business stability in a
market with major barriers to entry and the possibility of providing a complex, integrated service to all
customers who want it.

The mid-term strategy is inexorably undergoing a change in the business model in the Czech Republic,
Poland and Slovakia (Austria is a mature and developed market) towards further treatment and
development of energy recovery technology using waste (incineration and fuel generation) given that the
legal situation (prohibition of landfills or taxes on landfills) has already been defined and this transition is
essential to maintaining the competitiveness and market share. Another essential strategic objective is
the increase in the quality and quantity of reusable raw materials to meet the European Union's ambitious
targets (Circular Economy) by investing in selective collection and automatic sorting facilities.

At an international level, the strong growth in the USA is worth particular mention, with the Group now in
the Top 15 companies in the sector in the USA, with expectations of moving into the Top 10 in the next 2
years. FCC Environmental Services already serves more than 10 million Americans, it is the largest recycler
in Texas, boasts a very important presence in the main cities and counties of Florida as well as significant
operations in both the Mid-West and the West coast of the country. Its growth continues to be exponential.

420

In 2023, several contracts launched in 2022 were consolidated, including some of the largest contracts
obtained (one in California and another in Florida), and an additional contract was launched in Palm Coast
County, Florida. In total, sales in the USA grew by 46% in 2023, consistent with the average annual growth
of 52% during the last 5 years. Additionally, the renewal of the contract in Polk County, FL and the award
of the collection service in St. Johns county, FL, are worth special mention, both due in the second half of
2024.

Highlight the consolidation of commercial business in the states of Texas and Florida, which accounts for
20% of the business figure, and whose 40% growth has been organic, which over the past year has grown
by 70% in sales y around 350% in gross result.

Finally, the Environmental Services Area also specialises in the end-to-end management of industrial and
commercial waste, recovery of by-products and soil decontamination, through the FCC Ámbito brand,
which encompasses a group of companies with an extensive network of management and recovery
facilities. This enables proper waste management, ensuring the protection of the environment and
people's health. In 2023, this activity represented almost 7% of the area's income (Environment, Spain and
Portugal).

Strategically, in Spain, as has been the case for years, actions will focus on maintaining competitiveness
and a leading position, combining know-how and the development of innovative technologies, offering
respectful, inclusive and sustainable services (combating climate change and reducing the carbon
footprint). Efforts shall also be made to harness potential opportunities offered by stricter regulations
and new services (smart cities), the ultimate objective of which is to replace the straight-line production
model with a circular model that reincludes residual materials into the production process, given the high
level of technical knowledge that the company has and the development of new machinery and innovative
processes, with a presence, either as leaders or collaborators, in a large number of R&D&i projects.

The inclusion of new technologies will make it possible for the company to consolidate itself in the
recycling and waste recovery markets in Europe and position itself as a key player in the circular economy,
with a change in the business model in the Czech Republic, Slovakia and Poland (Austria is a mature and
developed market) towards further treatment and development of energy recovery technology using waste
(incineration and fuel generation) given that the legal situation (prohibition of landfills or taxes on landfills)
has already been defined and this transition is essential to maintaining the competitiveness and market
share. Another essential strategic objective is the increase in the quality and quantity of reusable raw
materials to meet the EU's ambitious targets (Circular Economy) by investing in selective collection and
automatic sorting facilities. In the United States, the company will continue to consolidate its presence in
the coming years by growing more residential contracts and boosting commercial collection activity.

End-to-end Water Management

FCC Aqualia serves nearly 43,5 million users and provides services in 17 countries, offering the market all
the solutions to the needs of public and private entities in all phases of the end-to-end water cycle and for
all uses: human, agricultural or industrial.

FCC Aqualia's activity is focused on Concessions and Services, encompassing proprietary integrated
cycle infrastructures and concessions, BOT, operation and maintenance services and irrigation; as well as
Technology and Networks activities encompassing EPC contracts and industrial water risk management
activities.

In 2023, the market in Spain represents 61.8% of revenue. On a like-for-like basis, water consumption has
grown in Spain as a whole in 2023 by 1.8%, which reflects the lifting of COVID-19 restrictions, with the
amount invoiced increasing by 2,57% compared to 2022. Furthermore, there has been an improvement in
Operation and Maintenance (O&M) activities, efficiency improvements in operations and a higher volume
of works undertaken in relation to concession agreements. The recovery of economic activity, especially
in the services and tourism sector, has been affected by high inflation, which has slowed down over
the course of the year and the crisis in the availability of water resources due to the prolonged drought
suffered across large areas of Spain.

The central government and some regional governments have approved emergency plans, in particular
for the construction of new infrastructures, emergency works involving the construction of new deep
catchments, expansion of desalination plants and the improvement of surface water utilisation. Worth
particular mention are the new actions in Barcelona, Almería and Málaga in relation to desalination, and
reuse in Andalusia and Alicante, valued as a whole at 1,400 million euros, which will be implemented
in 2024 and subsequent years. The Spanish government has approved the third cycle of hydrological
planning for all national basins, for the period ending in 2027, with a particular focus placed on the
maintenance of ecological flows and the maintenance of quality standards set by the European Directives,
with a joint budget for the necessary actions of 22.8 billion euros.

The international market reached a turnover of 38,2%. FCC Aqualia focuses its activity in Europe, North
Africa, the Middle East and the Americas, with ongoing contracts in 16 countries at present.

At the end of 2023, a 97% holding was acquired in Municipal District Services, Llc. (MDS), a company that
manages the integrated water cycle on the outskirts of Houston (Texas). In total, it serves a population of
364,000 inhabitants.

421

FCC Aqualia seeks to maintain its competitive position in those end-to-end water management markets
where it has an established presence (Europe) and to take advantage of the opportunities that arise in this
activity. In other expanding markets, it plans to boost growth via BOT and O&M (North Africa, Latin America
and the Middle East), along with end-to-end cycle management, while the study of opportunities in others
(such as the USA).

In addition, FCC Aqualia will use its extensive experience in end-to-end water cycle management for
business opportunities in countries with a stable political and social balance.

Construction

The Construction Area focuses its activity on the design, development and construction of large civil,
industrial and building infrastructure projects. The presence in public works of complex elements such as
railways, tunnels and bridges stands out, which together with those involving installation and industrial
maintenance, form a large part of the activity. It has a selective presence in more than 16 countries across
Europe, MENA and America.

Its teams have the experience, technical training and innovation to participate in the entire project value
chain, from the definition and design, to its complete execution and subsequent operation.

In 2023, 60.8% of total income came from abroad, with a special emphasis on the performance of large
infrastructure works such as lines 4, 5 and 6 of the Riyadh Metro and the Neom tunnels (Saudi Arabia),
Mayan Train (Mexico), the A-465 highway (Wales), Lima Metro (Peru), Industrial Bridge (Chile), Toyo Tunnel
(Colombia), Sotra Link (Norway), A-9 Badhoevedorp-Holendrecht Highway (Netherlands), the Gurasada-
Simeria railway line (Romania) – Sectors 2a, 2b and 3, Regional Express Rail On-Corridor in Ontario
(Canada), Scarborough Subway Extension (Canada) and the construction and rehabilitation project of 9
bridges in Pennsylvania (USA).

Although there were no relevant awards abroad in 2023, it is worth noting that for the first quarter of
2024, new projects are expected to be secured, such as the EPC project for the natural liquefied gas (LNG)
storage and regasification terminal in Stade (Hamburg), the construction of the Rubí line of the Porto
Metro (Portugal), “Pape Tunnel and the Underground Station” for the Toronto Metro (Canada) and the
construction of a nuclear reactor in Petten (Netherlands), to name just a few.

At a national level, worth mention are the awards for the R-2 Underground Construction project
as it passes through Montcada i Reixac (Barcelona), the demolition of buildings, renovation of the
Auditorium and execution of the New ONCE Headquarters at Paseo de la Habana 208 (Madrid), the new
Aranda de Duero Hospital (Burgos), the A-73 Highway Construction project, Aguilar de Campo-Burgos
Quintanaortuño-Montorio Section (Burgos), the urban development of phase 3 in Los Berrocales (Madrid)

or the EPC projects for the Guillena Reunión photovoltaic plants of 268MWp (Seville) and TAGUS of
380MWp (Cáceres).

Cement

The Group carries out its cement activity through the Cementos Portland Valderrivas Group. Its core
business is cement manufacturing, which accounted for 92% of its turnover in 2023. The remaining
percentage was contributed by the concrete, mortar and aggregate businesses.

In terms of geographical diversification, by 2023, 38% of income came from international markets. The
Cementos Portland Valderrivas Group is present in Spain, Netherlands, Tunisia and via export in the United
Kingdom. Exports from these three countries also go to Africa, Europe and America.

It boasts a leading position both in its main market, Spain, and in the Tunisian market.

The main objective of the Cementos Portland Valderrivas Group is to maintain a competitive edge both
regarding costs and in the markets in which it operates, seeking to remain a leader in the sector in all the
countries in which it is present.

Real Estate

The Area is mainly active in property development and office rental. In 2023, the consolidation of the real
estate area of the FCC Group continued with the increase in the holding by FCC Inmobiliaria (FCyC S.A.),
a company 80.03% owned by FCCSA, in the listed companies Realia Business S.A. and Metrovacesa S.A.,
summarised as follows:

• Increase in the holding in Realia Business S.A. by 13.56% to 67.05% at the end of 2023 (53.49% in 2022).

• Increase in the holding in Metrovacesa S.A. by 7.38% to 21.21% at the end of 2023 (13.81% in 2022).

These operations are in addition to those performed over the past two years:

• Contribution to FCC Inmobiliaria of 100% of the shares in Jezzine Uno S.L.U, a property company that

operates 405 premises intended for bank offices whose only tenant is Caixabank.

• Increase of 37.11% in the holding in Hermanos Revilla S.A. (now Planigesa, S.A., following the merger)

taking the holding to 87.76%, this property company operates assets in prime areas of Madrid.

• Increase in its holding in Realia Business S.A and voluntary tender offer for 24% of the shares in

Metrovacesa S.A, obtaining 11.47% of its share capital.

FCC Medio Ambiente consolidates its presence in the waste treatment sector in the
United Kingdom, Spain and the USA

Last December, FCC Medio Ambiente agreed to buy out the Urbaser Group's business in the United
Kingdom. The enterprise value (including debt and equity) amounts to £398 million. The transaction is
expected to be completed in the second quarter of 2024, subject to the satisfaction of certain conditions,
customary in this type of transaction. The acquired business in the United Kingdom consists mainly of
recycling and waste treatment activities.

In Spain, relevant events included the award to modernise and operate the end-to-end waste management
facility in Jerez, serving a population of almost half a million people. The new facilities will increase their
recovery capacity and reduce shipment to landfill and are expected to come online in 18 months, with
the associated operation contract for a 20-year period and expected revenues of €317 million. Also worth
particular mention is street cleaning and municipal solid waste contract for the northern area of the city
of Valencia, which was renewed in September for a period of fifteen years, providing a revenue backlog of
€486.5 million.

In the United States the strengthening continues, with the award in the county of St. Johns (Florida) of the
municipal solid waste collection service for $575 million; with a duration of seven years and two possible
five-year extensions, covering a population of 300,000 residents. The planned investments include the
acquisition of a fleet of 62 compressed natural gas collection trucks and 13 auxiliary vehicles. Likewise,
work continues to expand and modernize the first recycling center in California (Placer County), with an
investment of more than 120 million dollars and an operating period of 20 years. The complex will be
one of the biggest of its kind, with a treatment capacity of 650,000 tonnes per year. Finally, the renewal
of the municipal solid waste collection contract in the western part of Polk County (Florida) is also worth
particular mention, with a turnover coming in at almost €140 million over a period of five years and three
possible one-year extensions.

Consolidated Group | Management Report | Page 6 of 46

All of this has allowed us to consolidate a solid and large real-estate group, with greater management
efficiency resulting from operational and financial synergies that allow us to harness sector growth
opportunities, diversify risk and the presence of FCC Inmobiliaria in Spain by expanding its activity to new
areas of operation in which it was not present; and finally, significantly increasing the recurring activity of
rental assets as a whole. The valuation of equity assets, in December 2023, accounted for more than 60%
of the group's total assets.

In December 2023, FCC Inmobiliaria achieved representation on the governing bodies of Metrovacesa,
S.A., which entails the consolidation of the company's financial statements applying the equity method,
reflecting the holding in the company at fair value and allocating, starting in 2024, 21.21% of future results
(notes 4,11, 13, 17 and 30 to the financial statements).

FCC Inmobiliaria considers that the acquisition of this significant interest, although a non-controlling
interest, in Metrovacesa, enhances the solidity of the real-estate group, thus benefitting from its cash-flow
generation capacity.

2. Business performance and results

2.1. Operating performance

2.1.1. Significant Events

FCC completes sale of 24.99% of the Environment parent company for €965 million

On 31 October, Canadian pension fund CPP Investment completed its acquisition of capital in the
Environment parent company, following the agreement reached on 1 June for it to acquire a minority stake
of 24.99% for an amount of €965 million. The entry of the new shareholder will enhance the position and
strategic development of the subsidiary, its areas and geographical footprint.

The Real Estate area reinforces its competitive position with new acquisitions

Last December, the real estate area, through its parent company FCyC, consolidated its competitive
position by investing €178.8 million in the purchase of shares in Metrovacesa and Realia, maximising the
value of all its assets and real-estate opportunities. After these acquisitions, reported to the stock market
regulator, its participation amounted to 21.19% in Metrovacesa and 66.29% in Realia.

423

FCC Aqualia expands its international activity and seals its entry into the US market

Last December FCC Aqualia entered the US market with the purchase of MDS (Municipal District Services),
a company based in Texas, for 81.4 million euros. MDS manages the comprehensive water cycle of more
than 360,000 local residents, mostly in the outskirts of Houston, with nearly 140 service contracts in place
with different district clients.

authorized the operation on October 25 and the acceptance period ended on November 30. This saw
4.502% of company's share capital, or 20,560,154 shares, being redeemed. As a result of this operation, the
company's share capital at the end of December 2023 stood at 436,106,917 shares.

2.1.2. Executive Summary

In relation to new end-to-end management contracts, worth particular mention is one for the design,
construction, rehabilitation and operation of hydraulic infrastructure in Riohacha-La Guajira in Colombia,
with a backlog worth €292.7 million for a duration of 30 years, in addition to the other relevant contracts
secured in France and Saudi Arabia.

KEY FIGURES

Revenue

As a result of the increase in water cycle management activity, the backlog at the end of the year grew by
7% and international contracts now account for 68.4% of the total in the water management area.

FCC Construcción secures an important industrial contract in Germany

FCC Industrial, a specialist subsidiary of the Group's construction division, has been awarded, in
consortium with other companies, the provisional contract for the construction of a regasification terminal
in Germany, the second of its kind in the country, for Hanseatic Energy Hub, with a revenue backlog of
€270 million. Likewise, FCC Industrial has also been awarded a contract to build solar facilities in Guillena
(Spain), with a total capacity of 263 MW and an investment of 140 million euros.

During the final quarter of the year, worth particular mention is the selection of the consortium led by
FCC Construcción to perform works on the new Porto metro line, dubbed Rubi (H), worth more than €379
million. The new line will add 6.3 kilometers to the city's metro network. Furthermore, the joint venture
in Spain in which FCC Construcción has a holding has been awarded the works for the underground
construction of line R2 in Montcada i Reixac (Barcelona) as well as the construction of the new station in
this town, for an amount attributable to FCC Construcción of €148.9 million.

In December, FCC completed the voluntary takeover bid for the amortization of its
own shares

The Board of Directors meeting held on June 28 announced that an Extraordinary General Shareholders'
Meeting would be scheduled for the acquisition of own shares for subsequent redemption, as part of a
takeover bid to be formulated by the Company and addressed to FCC shareholders for a maximum of
32,027,600 treasury shares, representing approximately 7% of the company's share capital, at a share price
of €12.50. The Extraordinary Shareholder's Meeting, held on 19 July, approved its submission. The CNMV

Gross operating profit (EBITDA)

EBITDA margin

Net operating profit (EBIT)

EBIT Margin

Income attributable to the parent company

Equity

Net financial debt

Backlog

Dec. 23

Dec. 22

Chg. (%)

(Millions of euros)

9,026.0

1,529.6

16.9%

910.3

10.1%

591.0

6,146.0

3,100.1

7,705.7

1,311.4

17.0%

610.5

7.9%

315.2

4,939.0

3,192.7

41,620.8

40,273.8

17.1%

16.6%

-0.1 p.p

49.1%

2.2 p.p

87.5%

24.4%

-2.9%

3.3%

The FCC Group saw an increase in its income to €9,026 million, 17.1% up on 2022. The increase in
activities in the construction sector (Cement and Construction) had a significant contribution to make to
this, followed by the major increase recorded in the Water area. Overall, this evolution does not include any
appreciable impact of acquisitions or divestitures carried out in the entire consolidated perimeter of the
Group.

Gross operating earnings (Ebitda) were up 16.6% to 1,529.6 million euros. This trend mirrors the increase
seen in income, with stability in operating profit, with a margin of 16.9%, similar to the margin seen the
previous year. This evolution is explained by a general maintenance of margins in a large part of the areas
of activity, together with notable progress in Cement, where there has been a more favourable sales price
environment together with lower energy costs. In turn, EBIT increased by 49.1% to €910.3 million, largely
thanks to the increase in EBITDA explained above and the favourable performance compared to the
previous year, which saw an adjustment of €200 million to the goodwill of the Cement area.

(Millions of Euros)

Area

Dec. 23

De22

Chg. (%)

% s/ 23

% s/ 22

REVENUE BY GEOGRAPHICAL AREA

Spain

America

United Kingdom

Rest of Europe and Others

Czech Republic

Middle East, Africa and Australia

4,737.3

1,305.7

1,113.8

1,052.8

413.7

402.7

4,271.2

760.3

1,048.4

878.2

385.4

362.2

10.9%

71.7%

6.2%

19.9%

7.3%

11.2%

52.5%

14.5%

12.3%

11.7%

4.6%

4.5%

55.4%

9.9%

13.6%

11.4%

5.0%

4.7%

9,026.0

7,705.7

17.1%

100.0%

Consolidated Group | Management Report | Page 8 of 46

The attributable net result reached 591 million euros, 87.5% higher than the previous year. In addition to the
performance seen in relation to EBIT, this increase notably reflects the effect of the consolidation under the
equity method of Metrovacesa's holding in the Real Estate area, for an approximate sum of €142.4 million.
This change occurs after access to the entity's board and the acquisition of influence in the management
of the investee entity.

In turn, net financial debt ended the year at €3,100.1 million, 2.9% down on 2022. This slight reduction
reflects many different factors, but worth particular mention on account of their uniqueness, on the
one hand, are the large investments made in assets and stakes in companies, for the combined sum of
€1,493 million, the collection of €965 million from a minority holding in the environmental division and the
€691.4-million increase in working capital, attributable both to cyclical factors and the increase in operating
activity seen by the Group.

There was a considerable increase in equity at the end of the year, up by 24.4% year on year, to €6,145.9
million; this can be attributed to the increase in consolidated profit and the positive impact of the sale of a
24.99% stake in FCC Medio Ambiente's parent company on reserves and non-controlling interests.

The FCC Group's revenue backlog stood at €41,620.8 million at 31 December, up by 3.3% compared to the
final balance for the previous year, with a notable increase in the Water area and similar volumes in other
areas that operate under contract revenues.

2.1.3. Summary by Business area

(Millions of Euros)

REVENUE BY BUSINESS AREA

Environment

Water

Construction

Cement

Real Estate

Corporate serv. and others

3.853,2

1.487,4

2.823,1

614,3

253,8

(5,8)

3.641,1

1.323,2

1.966,9

516,5

270,8

(12,8)

Total

9.026,0

7.705,7

5,8%

12,4%

43,5%

18,9%

-6,3%

-54,7%

17,1%

42,7%

16,5%

31,3%

6,8%

2,8%

-0,1%

47,3%

17,2%

25,5%

6,7%

3,5%

-0,2%

Total

EBITDA*

Environment

Water

Construction

Cement

Real Estate

Environment

Water

Construction

Cement

Real Estate

100,0%

Corporate serv. and others

Total

Area

Dec. 23

De22

Chg. (%)

% s/ 23

% s/ 22

Corporate serv. and others

Total

1,529.6

1,311.4

OPERATING PROFIT/(LOSS)

646.7

384.3

169.4

139.5

104.9

84.8

593.1

350.2

122.8

30.3

143.8

71.2

337.6

216.3

118.4

129.1

55.8

53.1

910.3

304.7

203.8

89.4

(203.3)

165.7

50.2

610.5

9.0%

9.7%

37.9%

n/a

-27.1%

19.1%

16.6%

10.8%

6.1%

32.4%

n/a

-66.3%

5.8%

49.1%

42.3%

25.1%

11.1%

9.1%

6.9%

5.5%

45.2%

26.7%

9.4%

2.3%

11.0%

5.4%

100.0%

37.1%

23.8%

13.0%

14.2%

6.1%

5.8%

49.9%

33.4%

14.6%

-33.3%

27.1%

8.2%

100.0%

425

Area

Dec. 23

De22

Chg. (%)

% s/ 23

% s/ 22

(Millions of Euros)

2.1.4. Income Statement

DEUDA FINANCIERA NETA*

Corporate

With recourse

Without recourse

Areas

Environment

Water

Cement

Real Estate

Total

BACKLOG*

Environment

Water

Construction

Real Estate

Total

(1,233.1)

(840.1)

74.3

87.1

1,424.7

1,665.8

131.4

1,037.0

1,227.6

1,642.8

157.6

917.7

46.8%

-14.7%

16.1%

1.4%

-16.6%

13.0%

-39.8%

2.4%

46.0%

53.7%

4.2%

33.5%

-26.3%

2.7%

38.5%

51.5%

4.9%

28.7%

3,100.1

3,192.7

-2.9%

100.0%

Revenue

Gross Operating Profit (EBITDA)

EBITDA Margin

Provision for amortisation of fixed and non-current assets

Other operating income

Net Operating Profit (EBIT)

EBIT margin

Financial income

Other financial profit/(loss)

P/L of companies accounted for by the equity method

Profit/(loss) before tax from continuing activities

13,328.4

13,255.5

21,730.7

20,312.7

6,425.9

135.8

6,586.0

119.6

41,620.8

40,273.8

0.5%

7.0%

-2.4%

13.5%

3.3%

32.0%

52.2%

15.4%

0.3%

32.9%

50.4%

16.4%

0.3%

Company tax on profits

Income from continuing operations

Net Income

Non-controlling interests

100.0%

Income attributable to the parent company

Dec. 23

9,026.0

1,529.6

16.9%

(596.9)

(22.5)

910.3

10.1%

(150.0)

(18.4)

174.0

915.9

(171.1)

744.8

(153.8)

591.0

Dec. 22

7,705.7

1,311.4

17.0%

(519.7)

(181.1)

610.5

7.9%

(119.1)

29.6

550.7

(72.7)

477.9

(162.7)

315.2

Chg. (%)

17.1%

16.6%

-0.1 p.p

14.9%

-87.6%

49.1%

2.2 p.p

25.9%

-162.2%

n/a

66.3%

135.4%

55.8%

-5.5%

87.5%

2.1.4.1. Net Revenue

Consolidated revenues grew by 17.1% compared to the previous year, reaching 9,026 million euros. This
shift reflects sustained growth during the year, with the increase in the contribution of the Construction
and Cement areas worth particular mention, seeing double-digit growth, on account of the expansion
of activity in practically all its areas of operation as well as the increase in contracting volumes and sale
prices, respectively. The Water area also registered significant growth in all its activities.

* See note 10 for a definition of the calculation in accordance with ESMA Guidelines (2015/1415en).
Note: Corporate Services and others includes the Concessions activity.

426

For each of the business Areas the evolution was as follows:

The Environment Area saw an increase of 5.8%, following the entry into force of new contracts in Spain
and the USA, both for waste collection and street cleaning activities as well as in treatment, with Central
Europe also making a positive contribution, thus compensating for the decrease in activity in the United
Kingdom, which can be entirely attributed to a drop in revenue on account of the landfill tax, resulting from
the change in the type of waste being managed.

Revenues in the Water area grew by 12.4%, on account of the strong performance, mainly in end-to-end
activity, supported by the inclusion of new contracts in Colombia and France, as well as in Technology and
Network activity thanks to work associated, to a large extent, with the operating concessions in Spain, Italy,
Colombia, and Mexico.

In Construction, revenues increased by a notable 43.5% due to the sustained good pace of execution in
ongoing projects along with new contracts obtained mainly in America and various European countries.

In the Cement area, revenues saw growth of 18.9%, on account of the increase in prices registered in
all markets, together with an increase in exports from Spain, which offset the decrease in activity in the
Tunisian market.

Finally, in the Real Estate area, revenues dropped by 6.3%, entirely attributable to the fact that no land
was sold during the year compared to the sales seen during the previous year, which came to €35 million.
This is despite the positive impact of price reviews on rental property activity and the increase in sales of
housing development.

Revenue breakdown by geographical area

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

Spain

America

United Kingdom

Rest of Europe and Others

Czech Republic

Middle East, Africa and Australia

4,737.3

1,305.7

1,113.8

1,052.8

413.7

402.7

4,271.2

760.3

1,048.4

878.2

385.4

362.2

Total

9,026.0

7,705.7

10.9%

71.7%

6.2%

19.9%

7.3%

11.2%

17.1%

By geographic area and contribution, Spain saw an increase in its revenues of 10.9%, to €4,737.3 million.
The double-digit increase in both the Construction and Cement areas stands out, 27.4% and 21.1%
respectively. The increase in the Construction area can be attributed to the strong performance of ongoing
projects and the start of new projects, while the increase in Cement can be traced to the sustained rise
in sale prices. In the Water and Environment areas there was also an increase in revenues, although
more moderately, by 6.7% and 5.6% respectively. The Environmental Area recorded an increase in waste
treatment and collection activity as well as street cleaning, while the Water Area saw an increase in rates
along with a moderate increase in consumption, although more pronounced in the non-residential sector,
in addition to the favourable performance of Technology and Networks operations. Real-Estate activity,
performed in its entirety in Spain, saw a drop in its income of 6.3% on account of the lack of land sales
explained above, despite the increase in its two main activities: rental property and housing development.

Revenues in America increased significantly, by 71.7%, to €1,305.7 million, thanks to the stronger pace of
the implementation of civil engineering projects in the Construction area, particularly in Mexico, combined
with the impact of new contracts launched in the US and Canada. In the Environment Area, there was an
increase in the contracting and entry into operation of new contracts for the collection and treatment of
municipal waste in the USA, and in the Water Area there was greater activity in Colombia in end-to-end
water cycle management.

The United Kingdom saw revenue growth of 6.2% to €1,113.8 million, attributable to the increase
in activities under transport infrastructure concession contracts, which compensated for the drop
Environmental services activity, exclusively on account of the drop in revenue caused by landfill tax, as
there has been an increase in recycling and recovery activities at the revaluation plants.

Rest of Europe and Others, on 1,052.8 million euros, saw growth of 19.9%, largely due to higher revenues
from Construction contracts in the Netherlands and the United Kingdom, combined with an increase in
activity in the end-to-end water cycle in Georgia and France.

The Czech Republic saw 7.3% growth to €413.7 million, with a greater contribution from the Water Area,
on account of the rate review performed, reinforced by the positive impact of the exchange rate for the
Czech koruna (+2.3% in the period). The Environment area maintained similar activity to the previous year,
tempered by lower sales prices for recycled materials (SRM).

Finally, in the Middle East, Africa and Australia (thanks to the contribution made by a new Construction
contract), activity increased by 11.2% to €402.7 million, mainly on account of the increase in the
contribution in Saudi Arabia, both attributable to the work performed as part of the Neom project, as well
as the increase in concession activity in the Water area.

% revenue by geographical area

4.5%

11.7%

14.5%

4.6%

Spain

United Kingdom

Rest of Europe and Others

Middle East, Africa and Australia

America

Czech Republic

12.3%

52.5%

2.1.4.2. Gross Operating Profit (EBITDA)

The Gross Operating Result amounted to 1,529.6 million euros, which represents an increase of 16.6%
compared to the previous year. This amount represents a margin of 16.9%, practically the same as in 2022.
This growth is very similar to the growth seen in revenue, where the increase registered in the Cement
area is worth particular mention on account of the differential effect and relief brought about by a drop in
energy costs, especially in electricity prices as well as the decrease in the Real Estate area attributable to
the adjustment made for a drop in the value recorded for homes unsold.

By business area, the most noteworthy developments have been:

427

In the Construction area, the gross operating result increased by 37.9% to 169.4 million euros. This
increase can be traced to the performance of revenue mentioned previously, with the international area
making a greater contribution. In this way, the operating margin in the period reached 6%, a level very
similar to that achieved in the previous year.

In Cement, gross operating profit stood at 139.5 million euros, notably up compared to the 30.3 million
euros seen the previous year. This increase can be explained by the combination of the substantial
increase in revenues, supported by higher sales prices, together with a reduction in energy costs, with a
notable impact in Spain. In this way, the margin rose to 22.7% compared to 5.9% the previous year.

The Real-Estate area saw a 27.1% decrease to €104.9 million, with a margin of 41.3%, on account of the
lack of any contribution from land sales this year and the provision set aside for the impairment of housing
assets unsold worth €25 million, which was mitigated by the increase in the contribution made by the
rental property backlog and the delivery of housing developments.

Finally, it is worth noting that Corporate Services and Others includes the Infrastructure Concessions,
which reflects the entry into operation of line 1 of the Murcia Tramway; as a whole, this activity contributed
€45.7 million euros during the year, compared to €31.1 million in the previous year.

% EBITDA by business Area

An increase of 9% in the Environmental Area to €646.7 million, higher than the increase seen in revenue,
to such an extent that the operating margin increased to 16.8%, up from 16.3% the previous year. This
can be traced to the increase in the contribution of activities in the USA, the contribution of treatment and
recovery plants in the United Kingdom and the positive impact of the lower collection of the landfill tax,
which made no contribution to the Area's operating result.

The Water area recognised €384.3 million, up by 9.7% year-on-year, attributable to the changes in revenue
mentioned previously and the impact of last year's reversal of a provision recognised in accounts for the
sum of €11.2 million, associated with a final decision in relation to a dispute in Spain.

Environment

Water

Cement

Construction

Real Estate

Corporate

11.1%

6.9%

9.1%

5.5%

25.1%

42.3%

428

The performance of the utilities areas of Environment and Water maintained their high contribution
to operating profit of 67.4% during the year. If the recurring activity of Real Estate rental assets and
transportation concessions is added, this contribution percentage rises to 77.1% of the total.

2.1.4.3. Net Operating Profit (EBIT)

Net operating profit amounted to 910.3 million euros, 49.1% more than in the previous year. This increase,
combined with the performance of gross operating profit indicated above, includes the base effect of the
adjustment made the previous year for the sum of €200 million to the value of different fixed assets and
goodwill in the Cement area. This aim of this was to reflect their estimated future capacity to generate
cash. This year, however, the review of the market value of the rental property assets in the Real Estate
area has had an impact of -€49 million, compared to the positive impact of €22.3 million in 2022.

2.1.4.4. Earnings before Taxes (EBT) from continuing operations

Earnings before taxes from continuing operations stood at €915.9 million euros, up 66.3% year on year
from €550.7 million. This increase is attributable, as well as to the positive performance of business
operations, to the significant increase in the profit of companies consolidated using the equity method,
which has offset the increase in financial expenses.

Thus, the performance was as follows for the various components:

2.1.4.4.1. Financial income

The net financial result reached -150 million euros, compared to -119.1 million euros in the previous year,
25.9% more due to the effect of a higher average financing cost together with a certain increase in the
average volume of financial debt recorded during the year compared to the previous one.

2.1.4.4.2. Other financial profit/(loss)

This heading includes the amount of -€18.4 million compared to €29.6 million in 2022. The difference can
mainly be attributed to the change in the exchange rate of certain currencies against the euro, which had
an impact of -€20.9 million euros during the period, compared to the positive contribution of €26.1 million
the previous year.

2.1.4.4.3. Profits/(losses) of companies accounted for by the equity method

The contribution of investee companies reached 174 million euros, compared to 29.6 million in the
previous year. This increase can mainly be attributed to the accounting reclassification of the holding in
Metrovacesa in the Real Estate area from financial investment to investment accounted for by the equity
method, having acquired significant influence in the company by joining its Board of Directors at the end of
the year. The impact of the adjustment of the 21.19% stake in the entity has been 142.4 million euros. The
remaining areas of activity did not experience any noteworthy changes in contribution during this period.

2.1.4.5. Income attributable to the parent company

The attributable net result achieved at the end of the year amounts to 591 million euros, which is 87.5%
higher than the previous year. This performance can mainly be attributed to the explanation given under
EBT, as well as the regularisation of corporate tax accrued compared to the previous year, which included
the registration of nearly €90 million of outstanding deductions and tax losses. Added to this is a reduction
in the result attributable to minority shareholders in the Real Estate area, which recorded 5.9 million euros
compared to 28.8 million euros the previous year.

2.1.4.6. Profit and loss statement figures on a pro rata basis

The most significant figures in the income statement, calculated on the basis of the percentage of
effective shareholding in each of the subsidiaries, joint ventures and associates, are as follows.

Revenue

Gross Operating Profit (EBITDA)

EBITDA Margin

Net Operating Profit (EBIT)

EBIT margin

Income attributable to the parent company

Dec. 23

8,522.7

1,280.8

15.0%

762.6

8.9%

591.0

Dec. 22

Chg. (%)

7,306.0

1,098.6

15.0%

449.1

6.1%

315.2

16.7%

16.6%

0.0 p.p

69.8%

2.8 p.p

87.5%

2.1.5. Balance sheet

Intangible fixed and non-current assets

Property, plant and equipment

Real Estate investments

Investments accounted for using the equity method

Non-current financial assets

Deferred tax assets and other non-current assets

Non-current assets

Inventory

Trade and other receivables

Other current financial assets

Cash and cash equivalents

Current assets

TOTAL ASSETS

429

(Millions of Euros)

Dec. 23

Dec. 22

Chg (Mn€)

2,483.5

3,829.8

2,091.3

1,034.3

748.4

468.3

2,342.1

3,496.8

2,122.9

502.6

910.6

499.5

10,655.7

9,874.5

1,234.3

2,957.4

260.5

1,609.7

1,143.2

2,468.0

221.3

1,575.5

6,062.0

5,408.0

141.4

333.0

(31.6)

531.7

(162.2)

(31.2)

781.2

91.1

489.4

39.2

34.2

654.0

16,717.7

15,282.5

1,435.2

Equity attributable to shareholders of the parent company

Non-controlling interests

Equity

Subsidies

Non-current provisions

Long-term financial debt

Other non-current financial liabilities

Deferred tax liabilities and other non-current liabilities

Non-current liabilities

Current provisions

Short-term financial debt

Other current financial liabilities

Trade and other payables

Current liabilities

TOTAL LIABILITIES

(Millions of Euros)

Dec. 23

Dec. 22

Chg (Mn€)

4,450.1

1,695.9

6,146.0

226.6

1,230.6

4,361.0

456.0

434.1

3,387.9

1,551.1

4,939.0

202.9

1,141.7

3,860.7

410.6

430.7

6,708.3

6,046.6

159.6

604.1

322.7

2,777.0

148.1

1,121.8

211.3

2,815.7

1,062.2

144.8

1,207

23.7

88.9

500.3

45.4

3.4

661.7

11.5

(517.7)

111.4

(38.7)

3,863.4

4,296.9

(433.5)

16,717.7

15,282.5

1,435.2

2.1.5.1. Property, plant and equipment, intangible assets and real estate investments

Operating fixed assets increased by 5.6% to €8,404.6 million year on year, on account of the new assets
incorporated following investments made, mainly by the Environment and Water areas in intangible and
tangible fixed assets. Real estate investments, adjusted for variations in their estimated market value at
the end of the year, remain without appreciable variations compared to last year.

430

2.1.5.2. Investments accounted for using the equity method

2.1.5.5. Equity

The heading of investments accounted for by the equity method amounts to 1,034.3 million euros at the
end of the year, 531.7 million more than at the end of the previous year. This increase can be attributed,
firstly, to the accounting reclassification of the holding in Metrovacesa in the Real Estate area from
financial investment to investment accounted for by the equity method, given its significant influence,
and secondly, to the increase in capital of an associate in the Cement area, which operates in the USA.
The breakdown of the most relevant investments at year-end is as follows:

Equity at the end of the period came to €6,145.9 million, compared to €4,939 million the previous year.
This increase can largely be attributed to the contribution of net income achieved in the period and in
particular the increase in reserves and non-controlling interests due to the sale of a non-controlling interest
in the Environmental Area for the combined amount of €953.8 million. In the opposite direction, the impact
of the reduction in capital following the buyback of own shares for their subsequent redemption for the
sum of €257 million is also worth particular mention.

1) 233.2 million euros for the stake in companies in the Environment area (recycling and municipal

services, mainly in Spain and the United Kingdom).

2) 123.0 million euros for the stake in transport and public infrastructure concessions, mainly in Spain,

Peru and the United Kingdom.

3) 67.6 million euros for stakes held in companies in the Water area, largely concessionary companies

that manage services abroad (North Africa, Spain and Mexico).

4) 132.4 million euros from the subsidiaries of the parent company in the Cement area.

5) 442.0 million euros from investee companies in the Real Estate area.

6) 36.1 million euros in investees in the Construction area located abroad.

2.1.5.3. Non-current financial assets

The balance of non-current financial assets dropped by €162.2 million compared to year-end of the
previous year, coming to €748.4 million, on account of the aforementioned reclassification of Metrovacesa
from financial investment to investment accounted for using the equity method.

This heading also includes the collection rights from concession agreements, for the combined sum of
547.3 million euros, mainly from the Environment, Water and Transport Concessions areas, as well as
financial credits granted to third parties, and long-term deposits.

2.1.5.4. Cash and cash equivalents

The balance of the heading Cash and other equivalent liquid assets amounts to 1,609.7 million euros as of
December 31, with no appreciable variations from the previous year. This balance is distributed in such a
way that:

In the perimeter with recourse, cash and equivalents totalled 818.3 million euros.

In the perimeter without recourse, cash and equivalents amounted to 791.4 million euros.

2.1.5.6. Endeudamiento financiero

Bank borrowings

Debt instruments and other loans

Finance lease payables

Other financial liabilities

Gross Financial Debt

Treasury and other current financial assets

Net Financial Debt

Net financial debt with recourse

Net financial debt without recourse

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (M€)

2,710.0

2,107.0

14.0

134.1

2,778.4

2,040.8

24.9

138.4

4,965.1

4,982.5

(1,865.0)

(1,789.8)

3,100.1

3,192.7

(68.4)

66.2

(10.9)

(4.3)

(17.4)

(75.2)

(92.6)

(901.7)

(677.2)

(224.5)

4,001.8

3,869.9

131.9

At year-end, the Group's gross financial debt remained practically the same as the previous year, down by
Є17.4 million to €4,965.1 million. 87.8% has long-term maturity, for an amount of 4,361.0 million euros and
a balanced distribution between bank debt and capital markets. The remaining 12.2% matures in the short
term, equally distributed between bank borrowings and commercial paper in the Environment Area.

The balance of net financial debt was down compared to the previous December by €92.6 million to
€3,100.1 million. Worth particular note was the collection of €965 million from the sale of a non-controlling
interest in the parent company of the Environment Area and the investments made both in assets and
company shares, as well as the expansion of working capital linked to the increase in the Group's activity.

Breakdown of Net Financial Debt without recourse by Business Area

2.1.6. Cash Flow

431

Environment

Water

Cement

Corporate

Real Estate

1.8%

23.9%

32.9%

3.0%

38.4%

The entire net financial debt is non-recourse and the vast majority is located in the Water and Environment
Utilities areas along with the recurring activity of rental assets in the Real Estate area. As a result, the
Group's parent company had a net cash position with recourse of €1,233.1 million at the end of December.

Investment cash flow

Interest paid

Net financial debt without recourse to the Group's parent company is structured as follows:

(i) The Water Area accounts for €1,665.8 million, mainly including a long-term syndicated loan for €1,100
million and a corporate bond in its parent company with a balance of €658.3 million, maturing in June
2027;(ii) the Environment Area accounts for €1,424.7 million, of which the majority corresponds to two
bonds issued by the parent company of the area, one for the nominal amount of €500 million maturing
in 2026 and another for €600 million maturing in 2029. A further €95 million correspond to activity in the
United Kingdom and €73.7 million to activity in the USA (iii) the Real Estate Area accounts for €1,037
million, mostly from the rental property business and (iv) the Cement Area accounts for €131.4 million.

2.1.5.7. Other current and non-current financial liabilities

Other current and non-current financial liabilities comes to €778.7 million at the end of the year. The
balance mainly includes the item suppliers of fixed and non-current assets for operating leases, amounting
to 420.9 million euros. It also includes other liabilities that are not financial debt, such as those associated
with hedging derivatives, suppliers of fixed and non-current assets, guarantees and deposits received.

Gross Operating Profit (EBITDA)

1,529.6

1,311.4

16.6%

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

(Increase)/decrease in working capital

Corporation tax (paid)/received

Other operating cash flow

Operating cash flow

Investment payments

Divestment receipts

Other investment cash flows

(Payment)/receipt of financial liabilities

Other financing cash flow

Financing cash flow

Exchange differences, change in consolidation scope, etc.

Increase/(decrease) in cash and cash equivalents

2.1.6.1. Operating cash flow

n/a

-49.2%

4.0%

-29.7%

46.0%

2.6%

39.5%

-65.9%

n/a

(691.4)

(124.2)

71.4

785.4

285.3

0.7

(51.6)

1,545.8

(1,104.6)

(1,062.1)

36.2

106.0

51.5

72.6

(962.4)

(938.0)

(172.5)

(113.8)

496.6

210.3

1.0

34.2

(123.7)

(333.9)

(109.6)

(567.2)

-137.1%

(0.6)

n/a

40.0

-14.5%

The operating cash flow generated in 2023 amounted to €785.4 million euros, 49.2% down on the previous
year. This performance was largely attributable to the investment in operating working capital, which
entailed the allocation of funds for the sum of €691.4 million, compared to an inflow of €285.3 million the
previous year. This investment was concentrated in the Construction Area in projects at different degrees
of completion and to a lesser extent, in the Environment Area, which will tend to reverse this trend in the
first quarter of 2024. Income tax payments/collections includes an outflow of €124.2 million compared to
an almost non-existent amount in the previous year; this shift can be attributed to the receipt during the
previous year of €153.7 million in tax refunds owned from 2020 and 2021, well above the receipts seen this
year for advance payments made in 2022.

Consolidated Group | Management Report | Page 16 of 46

432

Other operating cash flow includes an inflow of €71.4 million compared to an outflow of €51.6 million the
previous year, due to the reduced application of provisions mainly in the Construction area.

2.1.6.2. Investment cash flow

The investment cash flow represents an application of 962.4 million euros compared to 938 million
euros in the previous year. The investment payments heading includes 1,104.6 million euros, compared
to 1,062.1 million euros the previous year. Investments by the Environment and Water Areas for the sum
of €545 million and €247.8 million respectively, are worth particular mention, as is the capital increase
performed in a Cement investee for the sum of €105.8 million. Finally, it is worth highlighting the increase
in Metrovacesa's participation in the Real Estate area costing €89.4 million. In this fiscal year 2023, no
relevant divestments have been recorded.

The breakdown of net investments by business area, excluding other cash flows from investment
activities, in terms of payments and collections, is as follows:

The Proceeds from/(payments on) financial liabilities heading includes an outflow of €113.8 million
compared to an outflow of €333.9 million the previous year. The reduction is concentrated at the Group's
parent company due to the aforementioned sale of a minority stake in the Environmental area.

The Other financing cash flows heading includes an inflow worth €496.6 million compared to an outflow
of €109.6 million the previous year. This increase can be attributed to several factors, including the
aforementioned sale of a non-controlling interest in the parent company of the Environment area for the
sum of €965 million and the takeover performed by the parent company of the Group for 4.502% of its
share capital, resulting in an outflow of €257 million, the purchase of an additional holding in Realia, in
the Real Estate area, for €117.3 million and the payment of dividends to shareholders and non-controlling
interests for the joint amount of €80.8 million.

2.1.6.4 Change in cash and cash equivalents

As a result of the evolution of the different cash flow components, the FCC Group's treasury position
closed the 2023 financial year with an increase of 34.2 million euros, to a balance of 1,609.7 million euros.

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

2.1.7. Analysis by business Area

Environment

Water

Construction

Cement

Real Estate

Corporate serv., other & adjustments

(531.8)

(241.6)

(47.1)

(129.7)

(109.7)

(8.5)

(407.5)

(362.9)

(21.4)

(22.2)

(154.4)

(42.2)

(124.3)

121.3

(25.7)

(107.5)

44.7

33.7

Net investments (Payments - Collections)

(1,068.4)

(1,010.6)

(57.8)

In turn, Other investment flows increased to 106 million euros in the period compared to 72.6 million euros
the previous year, attributable to an increase in the collection of interest up to 46.6 million euros.

2.1.6.3. Financing cash flow

The financing cash flow represents an inflow of 210.3 million euros compared to the outflow of 567.2
million euros in the previous year. The interest payment heading includes an outflow of €172.5 million,
mainly in relation to the Water and Environment Areas.

2.1.7.1. Environment

The Environment area contributed 42.3% of the Group's EBITDA in the 2023 business year. Around 80% of
its activity focused on the provision of essential waste collection, treatment and disposal services, as well
as street cleaning. The remaining 20% corresponded to other types of urban environmental activities, such
as the conservation of green areas or sewage systems.

In Spain it provides services in more than 3,700 municipalities and serves a population of more than
32 million inhabitants. It is worth mentioning the important weight of the urban waste management and
street cleaning services. In the UK, it focuses on urban waste treatment, recovery and disposal activities
and serves more than 16 million people. In central Europe, mainly Austria and the Czech Republic, it is
present throughout the entire waste management chain (collection, treatment and disposal). The activity
in the US is carried out both in the collection and in the comprehensive recovery of urban waste and serves
more than 11 million inhabitants. The Environment activities within the FCC Group have over 120 years of
experience and service over 66 million inhabitants over 5,200 municipalities in the world.

Consolidated Group | Management Report | Page 17 of 46

2.1.7.1.1. Earnings

Turnover

Waste collection and street cleaning

Waste processing

Other services

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

In the United Kingdom, revenues fell by 2% to €778.7 million on account of the reduction in the collection
of the landfill tax, which could not be offset by the increase in the contribution made by recycling and
recovery plants. Adjusted for this component, without impact on the operating result, revenues grew by
9.3% in the year.

3,853.2

1,938.6

1,142.6

772.0

646.7

16.8%

337.6

8.8%

3,641.1

1,765.0

1,130.1

746.0

593.1

16.3%

304.7

8.4%

5.8%

9.8%

1.1%

3.5%

9.0%

0.5 p.p

10.8%

0.4 p.p

In Central Europe, revenues increased by 2.5% to €607 million, on account of the favourable performance
especially in Austria and Poland, mainly in collection and street cleaning, compensating for the slight
decrease in waste treatment, on account of lower international sales prices recorded in relation to
secondary raw materials (SRM).

Last but not least, revenue in the United States and other markets was up by an impressive 36.7% to
€381.2 million, supported by the contribution of the new contracts secured in collection and treatment
activity, mainly in Florida, Texas and California, respectively.

The revenue figure for the Environment area increased by 5.8% and reached 3,853.2 million euros at the
end of the year. Waste collection and street cleaning activity billed €1,938.6 million, recording growth of
9.8% on account of the entry into operation of new contracts, especially in Spain and the USA. The Waste
Treatment activity reached 1,142.6 million euros, with a 1.1% increase, due to the good performance in
Spain and the US, which compensated for the lower contribution from the United Kingdom. Other services
grew by 3.5% to 772 million euros.

Breakdown of revenue by geographical area

Spain

United Kingdom

Central Europe

15.8%

20.2%

9.9%

Breakdown of revenue by geographical area

(Millions of Euros)

USA and Others

Dec. 23

Dec. 22

Chg. (%)

54.1%

Spain

United Kingdom

Central Europe

United States and other

Total

2.086,3

1.975,2

778,7

607,0

381,2

794,9

592,2

278,8

3.853,2

3.641,1

5,6%

-2,0%

2,5%

36,7%

5,8%

By geographical area, in Spain, revenue increased by 5.6% year on year to €2,086.3 million, on account of
the expansion seen in waste collection and street cleaning activity as well as waste management. Other
services, such as maintenance of green areas, remained at similar figures to those of the previous year.

The gross operating result (EBITDA) increased by 9%, with 646.7 million euros, motivated by the evolution
described in the income figure. The increased contribution of the treatment and recovery plants in the
United Kingdom comfortably offset the drop in SRM sales prices combined with the impact of the planned
shutdown of a plant in Austria during the first quarter of the year. The operating margin increased to 16.8%
compared to 16.3% the previous year, on account of the aforementioned impact of the drop in income
collected on account of the landfill tax paid to the public authorities in the United Kingdom, which made no
contribution to operating income.

Consolidated Group | Management Report | Page 18 of 46

The net operating result (EBIT) grew by 10.8% compared to the previous year, up to 337.6 million euros,
due to the evolution of the different components mentioned in the Ebitda with a lower impact of other
non-recurring operating expenses.

Breakdown of backlog by geographical area

(Millions of Euros)

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

8,390.6

4,937.8

8,224.1

5,031.4

13,328.4

13,255.5

2.0%

-1.9%

0.5%

At year-end 2023, the revenue backlog had not suffered significant changes compared to last December,
standing at €13,328.4 million. In Spain, it increased by 2% to €8,390.6 million on account of new contracts,
including the urban sanitation contract in northern Valencia or the management of the Las Calandrias
Environmental Complex, in Jerez de La Frontera, which compensated for the slight decrease seen in the
international area.

434

In Spain, the area serves more than 13 million inhabitants. In Central and Eastern Europe, it is mainly
present in the Czech Republic and Georgia, serving close to 3 million users across the two countries; in
other EU countries, its presence in Italy, France and Portugal is worth particular mention. In Latin America,
the Middle East, and Africa its activity centres on the design, equipping, and operation of hydraulic
infrastructures and processing plants. Overall, the Water area provides supply and/or sanitation services to
more than 45 million inhabitants.

2.1.7.2.1. Earnings

Turnover

Cycle Management and Services

Technology and Networks

EBITDA

EBITDA Margin

EBIT

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

1,487.4

1,343.7

143.7

384.3

25.8%

216.3

14.5%

1,323.2

1,212.2

111.0

350.2

26.5%

203.8

15.4%

12.4%

10.8%

29.5%

9.7%

-0.7 p.p

6.1%

-0.9 p.p

2.1.7.1.2. Financial Debt

Net Financial Debt

(Millions of Euros)

EBIT margin

Dec. 23

Dec. 22

Var. (Mn€)

1,424.7

1,227.6

197.1

Net financial debt increased by 197.1 million euros compared to December 2022, up to 1,424.7 million
euros, due to greater investment activity in new contracts and to a lesser extent due to the absorption of
current operating capital, which will reverse in the first quarter of 2024.

2.1.7.2. Water

The Water area contributed 25.1% of FCC Group EBITDA in the period. 90% of its activity is focused
on public service concession and asset management related to the end-to-end water cycle (collection,
treatment, storage and distribution) and the operation of different types of water infrastructures;
the remaining 10% corresponds to Technology and Networks, which is responsible for the design,
engineering and equipment of hydraulic infrastructures, related in the large part to the development of new
concessions and maintenance and improvement works for operations.

Revenue at the end of the year increased by 12.4% year on year, coming in at €1,487.4 million. This
increase was seen in all activities and geographies, supported both by the increase in rates, the increase
in new contracts, in the case of Colombia and France, and by the increase in activity in Technology and
Networks, for the large part linked to concessions in Spain, Italy, Colombia and Mexico.

Breakdown of revenue by geographical area

(Millions of Euros)

Spain

Central and Eastern Europe

Middle East, Africa and Other

Rest of Europe (France, Portugal and Italy)

Latin America

Total

Dec. 23

Dec. 22

Chg. (%)

919.2

232.7

134.6

109.5

91.4

861.4

190.0

131.1

92.3

48.4

1,487.4

1,323.2

6.7%

22.5%

2.7%

18.6%

88.8%

12.4%

435

By geographical area, revenues in Spain increased by 6.7%, reaching 919.2 million euros, due to the
combined increase in consumption and the increase in rates. Technology and Networks also saw
favourable performance following the implementation of work under investment plans associated with
concession agreements and the execution of water infrastructure.

Gross operating earnings (EBITDA) increased by 9.,7% to €384.3 million. Its progress reflects the increase
described above in all geographical areas, together with the base effect of the accounting in the previous
year of a reversal of 11.2 million euros corresponding to a provision linked to the resolution of a dispute in
Spain. As a result, the operating margin stood at 25.8%.

In Central and Eastern Europe it grew by 22.5%, with revenues of 232.7 million euros, due to greater activity
in the Czech Republic and Georgia thanks to the favourable behaviour of rates and consumption in the
latter. Worth particular mention was the revaluation of the Czech koruna (+2.3%) and the Georgian lari
(7.9%).

In the rest of Europe, revenues also increased significantly, by 18.6%, to €109.5 million on account of the
increase in concession activity from new contracts in France and infrastructure activity in the end-to-end
cycle management in Italy.

In the Middle East, Africa and Others, turnover increased by 2.7%, to €134.6 million, with an increase in
concession activity, with the two regional contracts ("Cluster") in Saudi Arabia worth particular mention, in
addition to the increased contribution from Algeria. On the contrary, the Technology and Networks activity
saw the completion of the construction of projects in Qatar and Egypt, with their entry into the operation
phase.

In Latin America, turnover experienced notable growth of 88.8% to €91.4 million, with new concessions
of the end-to-end water cycle in Colombia and works associated with its investment plans, as well as the
implementation of hydraulic infrastructure in Mexico.

Breakdown of revenue by geographical area

Spain

Middle East, Africa and Others

Central Europe

Latin America

Rest of Europe

61.8%

15.7%

9.0%9.0%

6.1%

7.4%

Net operating profit (EBIT) increased by 6.1% to €216.3 million, on account of the improvement in gross
operating profit combined with the increase in provisions made for amortisation, associated with the
increase in the volume of assets owned and operated during the period.

Breakdown of backlog by geographical area

(Millions of Euros)

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

6,860.6

7,049.2

14,870.1

13,263.5

21,730.7

20,312.7

-2.7%

12.1%

7.0%

The portfolio at the end of December 2023 reached 21,730.7 million euros, 7% more than the previous
year. At an international level, there was an increase of 12.1% on account of the addition of new contracts
in Saudi Arabia, Colombia and the United States, in addition to the consolidated tariff updates during the
year.

2.1.7.2.2. Financial Debt

Net Financial Debt

(Millions of Euros)

Dec. 23

1,665.8

Dec. 22

Chg. (Mn€)

1,642.8

23.0

Net financial debt remained at very similar levels compared to December last year, coming in at €1,665.8
million. This evolution is a combination of greater containment of investments after the acquisition of
GGU in Georgia in 2022, which has compensated for the greater absorption of current capital and financial
expenses due to the rise in interest rates.

436

2.1.7.3. Construction

The Construction Area contributed 11.1% of the FCC Group's EBITDA in 2023. Its activity is structured
around the design and construction of large civil, industrial and building works, with a selective presence in
specific regions across more than 15 countries. Special mention should go to participation in major works
like tunnels, bridges and motorways that constituted a major part of the project backlog.

Likewise, in the Rest of Europe and other markets, revenue grew by 38.9% year-on-year, coming to 695.1
million euros, mainly on account of the strong progress made with the A-9 motorway in the Netherlands
and A-465 in Wales (United Kingdom), which comfortably offset the end of other works.

The Middle East, Africa, Australia and Others increased their contribution to revenue to €200.6 million,
23.8% up year-on-year, mainly due to the increase in the contribution of works as part of the Neom project
and Riyadh Metro in Saudi Arabia, which is now close to completion.

Turnover

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

Chg (%)

2,823.1

169.4

6.0%

118.4

4.2%

1,966.9

122.8

6.2%

89.4

4.5%

43.5%

37.9%

-0.2 p.p

32.4%

-0.3 p.p

Revenues from the area increased by an impressive 43.5% to 2,823.1 million euros attributable the
continued good pace of ongoing projects combined with new contracts secured mainly in America and
several European countries.

Breakdown of revenue by geographical area

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

Spain

America

Rest of Europe

Middle East, Africa, Australia and Others

1,108.1

819.3

695.1

200.6

870.1

434.3

500.5

162.0

Total

2,823.1

1,966.9

27.4%

88.6%

38.9%

23.8%

43.5%

By geographical area, turnover in Spain increased by 27.4% to €1,108.1 million, on account of the faster
than expected progress on ongoing projects, mainly in the public sphere.

In America, turnover grew significantly by 88.6% to €819.3 million, on account of the increase in the
contribution of the Mayan Train project in Mexico, which is now close to completion, and the start of
railway works in Toronto (Canada) and the USA.

Breakdown of revenue by geographical area

Spain

Middle East, Africa,
Australia and Others

Rest of Europe

America

7.1%

39.3%

24.6%

29.0%

Gross operating profit increased by 37.9% to 169.4 million euros compared to 122.8 million euros the
previous year. This increase can be traced to the performance of revenue mentioned previously, with
the international area making a greater contribution. In this way, the operating margin in the period has
reached 6%, a level similar to that achieved in the previous year.

In turn, net operating profit stood at 118.4 million euros, 32.4% up on the previous year, reflecting the
performance of gross operating profit explained earlier and including the higher depreciation of machinery
compared to the increase in activity.

Breakdown of backlog by geographical area

(Millions of Euros)

2.1.7.4.1. Earnings

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

2,386.1

4,039.8

1,817.3

4,768.7

6,425.9

6,586.0

31.3%

-15.3%

-2.4%

The revenue backlog at year-end fell by 2.4%, to €6,425.9 million. Spain saw notable growth of 31.3%
to €2,386.1 million on account of the award of new works, including the construction of the new ONCE
headquarters in Madrid or the undergrounding section of the R-2 line as it passes through Montcada i
Reixac (Barcelona). The International Area saw a 15.3% reduction following the impressive accumulated
increase in contract awards the previous year, with the contract for the modernisation of a series of
bridges in Pennsylvania (USA) worth particular mention.

Turnover

Cement

Other

EBITDA

EBITDA Margin

EBIT

EBIT margin

437

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

614.3

563.6

50.7

139.5

22.7%

129.1

21.0%

516.5

474.1

42.4

30.3

5.9%

(203.3)

-39.4%

18.9%

19.6%

n/a

16.8 p.p

n/a

60.4 p.p

Breakdown of the Backlog by Activity Segment

(Millions of Euros)

The area's revenue grew by 18.9% year-on-year to €614.3 million, following an increase in prices, mainly in
Spain, in addition to an increase in exports from the same region.

Breakdown of revenue by geographical area

(Millions of Euros)

Civil engineering works

Building

Industrial Projects

Total

Dec. 23

Dec. 22

Chg. (%)

5,112.4

5,569.7

656.9

656.6

503.9

512.4

6,425.9

6,586.0

-8.2%

30.4%

28.1%

-2.4%

Spain

Tunisia

Miscellaneous (exports)

By activity type, civil engineering continues to dominate, accounting for 79.6% of the total, concentrated in
large public contracts in certain selective markets in Europe, America and the Middle East.

Total

Dec. 23

Dec. 22

Chg. (%)

380.9

62.2

171.2

614.3

314.6

62.6

139.3

516.5

21.1%

-0.6%

22.9%

18.9%

2.1.7.4. Cement

The Cement area accounted for 9.1% of the FCC Group's EBITDA during the period. This activity was
undertaken by the CPV Group, which focuses on manufacturing cement and by-products, with seven main
production centres in Spain and 1 in Tunisia, in addition to a minority stake of 45% in Giant Cement, which
owns a number of factories on the east coast of the USA.

By geographical area, in Spain, turnover increased by 21.1% to €380.9 million on account of the significant
sustained increase in prices combined with unchanged volumes.

In the local market of Tunisia, the turnover remained at similar levels to the previous year, with 62.2 million
euros, since the increase in prices has almost entirely compensated for the drop in demand.

In turn, revenue from exports grew by 22.9%, coming to €171.2 million, on account of the increase
in shipments from Spain to certain countries in Europe and America, combined with price increases,
offsetting the decreased in shipments from Tunisia.

Breakdown of revenue by geographical area

Spain

Tunisia

Other

27.9%

10.1%

62.0%

438

The financial debt, in its entirety, without any recourse to the Group's parent company, decreased by
€26.2 million compared to last December, down to €131.4 million as a consequence of the operating
performance explained above and the impact of the investment in the capital increase performed by the
subsidiary, Giant Cement (USA), for an attributable amount of €105.8 million.

2.1.7.5. Real Estate

The Real Estate area contributed 6.9% of the FCC Group's EBITDA during the year. Its activity is centred in
Spain and is structured in two main activities, with the first being the holding, development, and operation
of all types of real estate on a rental basis (mainly offices and shopping centres). This is in addition to the
development for sale of properties, which includes the urban management of its land portfolio, providing
development management services for third parties.

There was a significant increase in gross operating profit, coming to €139.5 million compared to €30.3
million during the previous year. This increase can be attributed both the increase in sales figures and the
significant drop in electricity prices in Spain, which saw the operating margin recover to 22.7% compared
to 5.9% the previous year.

Net operating profit stood at €129.1 million compared to losses of €203.3 million in 2022, due to the
aforementioned change in gross operating income and the €200 million adjustment in the previous year,
corresponding to the lower value of different tangible fixed assets and goodwill, reflecting its estimated
future cash generation capacity. Likewise, this year the favourable resolution of a dispute in Spain has also
contributed positively, with a recorded amount of 24.5 million euros.

2.1.7.5.1. Earnings

Turnover

Development and land

Rental Property

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

253.8

138.0

115.8

104.9

41.3%

55.8

22.0%

270.8

165.0

105.8

143.8

53.1%

165.7

61.2%

Chg%)

-6.3%

-16.4%

9.5%

-27.1%

-11.8 p.p

-66.3%

-39.2 p.p

2.1.7.4.2. Financial Debt

Net financial debt

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

131.4

157.6

(26.2)

The Area's income dropped by 6.3% year on year, to €253.8 million, with price reviews in relation to Rental
activity and the increase in sales of housing developments failing to offset the impact of the absence of
land sales during the year.

Development and Land recognised €138 million of income, down by 16.4%, on account of the fact that the
increase in housing development sales, despite being higher than expected, failing to compensate for the
absence of land sales, compared to the €35.93 million recognised the previous year.

In Rental Property, income reached 115.8 million euros, with an increase of 9.5% compared to the previous
year. Its revenues are concentrated in the use of offices (comprising Jezzine's network of properties
dedicated to the rental of bank branches), which accounted for more than 85% of the total, followed by rent
generated by the operation of shopping centres. At year-end, the occupancy levels exceeded 93% high in all
uses, locations, and the very long-term contract held by the subsidiary Jezzine in relation to bank offices.

EBITDA dropped by 27.1% to €104.9 million, with a contribution margin of 41.3%, on account of the
impact of the provision for the impairment in housing development for the sum of €25 million and the
aforementioned absence of land sales during the year. These two impacts mean that almost all of the
EBITDA for the year was generated by Rental activity.

In addition to the explanations provided under EBITDA, EBIT includes the impact of the shift in interest
rates on the fair market value of the rental assets, amounting to losses of €49 million, compared to the
gains of €22.3 million the previous year.

The market valuation (G.A.V.) of the real estate assets in the area as of December 31, 2023 reaches 2,902.1
million euros, 2.6% lower than the previous year. The majority of the estimated value of assets corresponds
to Property, which account for 73.6% of the total, on €2,134.8 million, while Residential Development
assets, which include land in the different stages of development as well as housing developments for
sale, both in progress and finished, account for 26.4% of the total, on €767.3 million.

GAV by Activity (not including Metrovacesa)

Property

Development

73.6%

26.4%

439

Property

Residential Development

16%

79%

Offices

Retail

Others

2.1.7.5.2.Financial Debt

Net financial debt

35%

46%

18%

Planning and Others

Land for Development

Finalist

In progress and completed

(Millions of Euros)

Dec. 23

1,037.0

Dec. 22

Chg. (Mn€)

917,.7

119.3

The balance of net financial debt increased by €119.3 million compared to December of the previous
year, coming to €1,037 million, mainly on account of the acquisition in December 2023 of two significant
packages of holdings in Metrovacesa and Realia for the combined sum of €178.8 million.

440

2.2. Business performance. Environment

2.3 Business performance. Personnel

The information relating to the FCC Group's environmental policy is set out in greater detail in note 28 and
29 to the consolidated financial statements and in the Non-Financial Information Statement.

Aware of the importance for the Group of preserving the environment and the responsible use of available
resources, and in line with the vocation of service through activities with a clear environmental focus,
the Group promotes and encourages the following principles throughout the organisation, on which the
contribution to sustainable development is based:

• Continuous improvement: Promote environmental excellence by establishing objectives for the

continuous improvement of performance, minimising the negative impacts of the Group's processes,
products and services, and enhancing the positive impacts on its areas of activity.

• Monitoring and control: establish environmental indicator management systems for the operational
control of processes, which provide the necessary knowledge for monitoring, assessment, decision-
making and communication of the Group's environmental performance and compliance with the
commitments undertaken.

• Climate change and pollution prevention: Lead the fight against climate change through the

implementation of processes with lower greenhouse gas emissions, and by promoting energy
efficiency and renewable energies. Prevent pollution and protect the environment through responsible
management and consumption of natural resources, and also by minimising the impact of emissions,
discharges and waste generated and managed by the Group's activities.

• Observation of the environment and innovation: Identify the risks and opportunities of the activities in
the face of the changing natural environment in order, among other things, to drive innovation and the
application of new technologies, and also to generate synergies between the Group's various activities.

Attached is a breakdown of the Group's headcount at the end of the year, by business area:

AREAS

2023

Environment

Water Management

Construction

Cement

Real Estate

Central Services and Others

Spain

Abroad

Total

%s/Total

36,152

6,971

4,115

865

388

8,279

6,793

3,150

212

44,431

13,764

7,265

1,077

457

66%

21%

11%

TOTAL

48,587

18,503

67,090

100%

3. Liquidity and capital resources

Liquidity

In order to optimise its financial position, the Group maintains a proactive liquidity management policy with
daily cash monitoring and forecasts.

The Group covers its liquidity needs through the cash flows generated by the businesses and through the
financial agreements reached.

• Life cycle of products and services: enhancing environmental considerations in business planning,

procurement of materials and equipment, and relations with suppliers and contractors.

In order to improve the Group's liquidity position, active collection management is carried out with
customers to ensure that they meet their payment commitments.

• The necessary participation of all parties: promote the knowledge and application of environmental

principles among employees and other stakeholders. Share experience in the most excellent practices
with the different agents in order to promote alternative solutions to those currently in place, which
contribute to the achievement of a sustainable environment.

To ensure liquidity and meet all payment commitments arising from the business, the Group has cash
flows as shown in the balance sheet (see note 16 to the consolidated financial statements) and detailed
financing (see note 19 to the consolidated financial statements).

Note 29 to the consolidated financial statements sets forth the policy implemented by the Group to
manage liquidity risk and the factors mitigating said risk.

441

Capital resources

The performance of interest rates in recent years is shown below.

The Group manages its capital to ensure that its member companies will be able to continue as profitable
and solvent businesses.

As part of its capital management operations, the Group obtains financing through a wide range of
financial products.

During 2019, FCC Servicios Medioambiente Holding, S.A.U. completed the issuance of two single bonds
in the amount of 1,100 million euros, just as FCC Aqualia, S.A. did in 2017. In December 2023, the bond
amounting to 600 million euros from FCC Servicios Medioambiente Holding, S.A. was repaid with funds
from the issuance of a new bond for the same amount.

In November 2018, FCC, S.A. registered a 300 million euros promissory notes programme, which was
subsequently expanded to 600 million euros in March 2019. Since then, new funding facilities were also
arranged in the form of credit facilities. In 2020, FCC Servicios Medioambiente Holding, S.A. registered a
promissory note programme which it renewed annually for an amount of up to €400 million; it also has
financing facilities in the form of credit facilities and bilateral loans.

Furthermore, in June 2022 FCC Aqualia, S.A. took out a syndicated loan for the amount of €1.1 billion, the
main purpose of which was to refinance part of the bonds issued in 2017 maturing in 2022 and the early
repayment of the bond that the Georgia Global Utilities Group had on the takeover date (Note 4 to the
consolidated financial statements).

These operations have made it possible to complete the process of debt reduction and financial
reorganisation initiated five years ago and to continue with the policy of diversifying financing sources; all
this contributing to achieving a much more stable and efficient capital structure, with amounts, terms and
financing costs suitable according to the nature of the different business Areas.

In order to optimise the cost of capital resources, the Group maintains an active policy of interest rate risk
management, constantly monitoring the market and taking different positions depending mainly on the
assets financed.

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

-1.00%

Dec18

Dec19 Mar20 Jun20

Sep20 Dec20 Mar21 Jun21 Sep21

Dec21 Jan22 Mar22 Jun22 Sep22

Dec22 Jan23 Feb23 Mar23 Apr23 May23 Jun23 Jul23 Aug23 Sp23 Ocy23 Nov23 Dec23

EURIB 6M

GBP-LIBOR 6M

USD-LIBOR 6M

SOFR

SONIA

As can be seen from the graph above, in 2022, the Secured Overnight Financing Rate (SOFR) and the
Sterling Overnight Index Average (SONIA) replaced the LIBOR in dollars and LIBOR in pounds sterling,
respectively.

This section is discussed in greater detail in note 29 to the consolidated financial statements.

442

4. Major risks and uncertainties

4.2. Major risks and uncertainties

4.1. Risk Management Policy and System

The FCC Group's Risk Management Model is designed with the aim of identifying, analysing and assessing
the potential risks that could affect the different areas of the Group, as well as establishing mechanisms
integrated into the organisation's processes that allow risks to be managed within accepted levels,
providing the Board of Directors and senior management with reasonable security in relation to the
achievement of the main objectives defined. This Model applies to all FCC Group companies, as well as
to those affiliates where FCC has effective control, promoting the development of work frameworks that
enable suitable risk control and management in those companies where effective control is not available.

This model is mainly based on the integration of the risk-opportunity vision and the assignment of
responsibilities, which, together with the segregation of functions, favour the monitoring and control of
risks, consolidating an adequate control environment.

The activities included in the FCC Group's Risk Management Model include the identification and
classification of risks depending on their type, their assessment, in terms of impact and probability of
occurrence, the application of prevention and control activities to mitigate the effect of these risks and
the establishment of reporting flows and communication mechanisms at different levels, which enable
decision-making as well as their review and continuous improvement.

The risk management duties and responsibilities at the different levels of the organisation are detailed in
section E on the Risk Management and Control System of the Annual Corporate Governance Report.

The FCC Group is exposed to various risk factors inherent to both the nature of its activities and the risks
related to environmental, economic, social and geopolitical upgrades in the different countries in which
it carries out these activities and to the risks arising from its relations with third parties, including the
risks arising from the non-exhaustive application of the principles of ethics and compliance set out in its
regulations. Many of these risk factors are strongly interconnected and could potentially affect both the
achievement of business objectives and the image and reputation of the FCC Group.

Details of the main strategic, environmental, operational and compliance risks that could affect the Group's
activities, as well as a description of the systems used to manage and monitor them, can be found in
section E of the Annual Corporate Governance Report, as well as in section 6.1 of the Non-Financial
Information Statement.

With regard to financial risks, which are considered to be the changes in the financial instruments arranged
by the FCC Group due to political, market and other factors, and their repercussions on the financial
statements, the risk management philosophy is consistent with the business strategy, seeking maximum
efficiency and solvency at all times. To this end, strict financial risk control and management criteria have
been established, consisting of identifying, measuring, analysing and controlling the risks incurred by
the Group's operations, with the risk policy being correctly integrated into the Group's organisation. The
financial risks to which the Group is exposed are discussed in greater detail in note 29 to the consolidated
financial statements, in section E of the Annual Corporate Governance Report and in section 6.1 of the
Non-Financial Information Statement.

In addition, the FCC Group is also subject to certain risks relating to environmental and social issues, the
management of which is described in greater detail in sections 5.3 and 6 of the Non-Financial Information
Statement.

5. Acquisition and disposal of own shares

On 14 June 2023, the redemption of a maximum of 0.85% of the share capital was approved at the General
Shareholders' Meeting, ratified by the Board of Directors on 15 June and registered in the Mercantile
Registry of Barcelona on 27 June 2023, with a total of 3,521,417 shares redeemed, taking the company's
capital stock to 434,823,566 shares. As a result, the treasury stock position at 30 June 2023 amounted to
854,234 shares, equivalent to 0.19% of the capital stock.

At the Board of Directors meeting held on 28 June 2023, the resolution was approved to additionally
redeem the 854,234 treasury shares circulating on that date; this operation was registered in the
Mercantile Registry on 25 July.

Then, in the month of August, FCC, S.A. requested authorisation from the CNMV for a takeover bid
by means of a capital reduction through the acquisition of a maximum of 32,027,600 own shares,
representing 7.01% of its capital stock. On 19 July, the Extraordinary General Meeting agreed, with a vote
in favour of 93.58% of the capital in attendance, on the reduction of capital, as well as the determination
of the main terms and conditions of the Bid. On 25 October, authorisation was received from the CNMV
and on 6 December, it published the results, accounting for 4.502% of share capital. On 19 December, the
resulting capital reduction was registered in the Mercantile Registry. The company's share capital at the
end of December 2023 was set at 436,106,917 euros, represented by 436,106,917 shares with a nominal
value of 1 euro each.

The treasury stock position at 31 December was 44,957 shares.

The acquisition and disposal of treasury shares carried out during the year are disclosed in Note 17 of the
Notes to the consolidated financial statements.

443

6. Significant events occurring after
the end of the year

7. Outlook

The outlook for the performance of the Group's main business Areas in 2023 is given below.

In the countries where the Environmental Services Area operates, the sector is undergoing a process of
transformation, mainly due to the environmental requirements of each country derived from the European
Directives (new opportunities based on the ambitious objectives set by the European Union in relation to
the circular economy and climate change). The new services will focus on energy efficiency, urban mobility
and smart cities.

In Spain, moderate growth is expected based on the implementation of new contracts, competing in all
tenders that may be of interest due to their strategy and/or attractiveness.

As regards waste collection and street cleaning activity, the current rate of contract renewal is expected to
be maintained, at above 90%, and the rate of new contracts at around 20%, with growth in activity based on
obligation to apply the current legislation on waste in towns with smaller populations.

In relation to waste treatment, the opportunities that may be generated by the new Waste Master Plans of
the different regional governments will be harnessed.

In relation to industrial waste activity, the aim is to diversify into other types of processing in addition to
those currently being developed and expand the portfolio of services to large customers.

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2.2.1. Europe

2.2.2. USA

In Portugal, business opportunities related to processing industrial waste and the disposal of municipal
waste is worth particular mention.

Consideration shall be given to any growth opportunities (including inorganic growth), especially if they can
add value to the Group.

In the United Kingdom, at a macroeconomic level, as in other Western economies, a moderate slowdown
in growth is expected in 2024. In relation to the environment, the government's objectives are, in general,
consistent with those of the EU circular economy, with expectations of 65% recycling and a maximum
of 10% of waste to landfills in 2025. The recent (2021) Environmental Law, which covers key aspects of
environmental policy such as Extended Producer Responsibility ("EPR"), the "Deposit Return Scheme"
("DRS") or recoverable packaging payments (single-use beverage containers), and there will be some
delay in the implementation of the principle of consistency across collection systems, as a result of both
political and economic factors. In terms of fiscal measures, the "Plastic Tax" was established in 2022
for packaging with less than 30% recycled content and an emissions tax has been announced for 2028,
which would affect the sector. Within this scenario of uncertainty caused by this delay, FCC continues to
pursue its policy of offering a wide range of waste treatment and recycling services, both at municipal and
commercial and industrial levels.

In Central Europe, inflation will remain a critical issue in 2024 as it will mean lower consumption and less
waste on the market. For this reason, greater emphasis will be placed on increasing energy efficiency
in treatment processes, cost reduction and rapid tariff adjustment with customers. On the other hand,
electricity and gas prices are expected to remain at lower levels than those seen towards the end of 2022
and throughout much of 2023.

It is expected that the prices of recycled goods will remain stable or very slightly higher than those seen
in 2023, the backlog of soil decontamination projects (solidification and biodegradation) in the Czech
Republic and Slovakia will be very similar to the backlog seen the previous year, with greater importance
placed on treatment due to legislative changes in several countries where FCC has already made (or
has begun to make) the necessary investments to be able to face them and an increase in rates across
practically all commercial activities thanks to contractual flexibility or price clauses included in municipal
contracts.

FCC has begun to promote mechanical biological treatment plants in the United States, in line with new
regulations that are beginning to make it mandatory in some statuses to minimise waste sent for landfill
disposal. The group's significant experience at an international level will bring considerable development
in this business for FCC, which has a clearly differentiating experience in this technology compared to its
usual competitors in the country. During mid-2022, the first contract of this type was launched in Placer
County (California), renovating and operating facilities where 650,000 tonnes will be treated per year,
pursuant to the new and more restrictive environmental regulations in force in California. Throughout
2023, these operations have been consolidated, while the final handover of the facilities is scheduled for
December 2024 and we believe that this will shake-up the market once they are fully operational.

Water

The outlook for 2024 is for the definitive consolidation of the recovery of pre-pandemic activity in relation
to non-residential consumption. This situation will be reinforced by the new contracts incorporated into the
perimeter during 2023 in Colombia, France and the USA, as well as the improvement in results, reinforced
by the continuation of cost optimisation actions.

The high rates of contract renewal that Aqualia has historically recorded on maturity (over 90%) are
expected to be maintained.

Electricity rates are expected to standardise and policies maintained to increase the number of contracts
that mitigate the potential volatility in prices with a higher volume of consumption closed at a fixed price.

It is also considered that many towns managed by Aqualia will adapt their tariffs or the company's
remuneration, to reflect the effect of the CPI increase during 2022-2023.

During 2024, the process for awarding projects eligible for the PERTE programme subsidy mechanism
is expected to be streamlined with a view to promoting the digitalisation of the management of the
integrated water cycle. We hope that as part of this process, Aqualia will be successful with a number of
the bids submitted.

In addition, Aqualia has worked hard to expand its presence in the O&M and facilities market (WWTP,
DWTP, desalination and network management). In terms of new procurement, several contracts, currently
operated by competitors, are expected to be tendered out.

Looking to Europe, in Portugal, the problems caused by the prolonged droughts have sparked an interest
amongst the public powers to consider the feasibility of building desalination plants for the first time in
mainland Portugal. Aqualia is striving to maintain active communication so that part of these investments
can be channelled as part of the robust Portuguese concession framework. Furthermore, a consortium led
by Aqualia and FCC Construcción was proposed as the successful candidate for the installation of a green
hydrogen production plant, including water supply and treatment facilities, in Setúbal, the first project of its
kind in the country.

In Italy, work on the Caltanisseta concession (Sicily) is expected to continue, with the improvement and
modernisation of the remote control and reading services of the facilities that serve more than 90,000
customers, from which 14 million euros have been obtained as part of the REACT-EU programme, as well
as continuing with the work to condition the general supply network.

In France, efforts will continue to increase activity by looking for and selecting new business opportunities
in towns and cities within the current perimeter of concession activity (Île-de-France, Bretagne) and
further afield (Normandie, Alsace, Lorainne, Val de la Loire). The population served in France comes to
920,000 inhabitants, with the Pays de Dreux contracts and the renewal of Andresy being the most relevant
milestones in 2023.

In the Czech Republic, |Czech subsidiary SmVak has designed an ambitious Sustainability Plan, aligned
with Aqualia's Sustainability Plan, establishing new investments aimed at improving the energy efficiency
of existing infrastructure and reducing the system's carbon footprint. Commercial activity in the country
has been intense, with tenders submitted for water contracts in important Bohemian cities where
existing private operators are already in place such as Prîbram and Pîsek, despite the trend of changing
the management model towards direct management. In the geographical area of coverage, Silesia and
Moravia, Aqualia, through its Czech subsidiary, has managed to win the tenders in Opava, Třinec, Žabeň,
Doubrava, Háj ve Slezsku and Těrlicko.

In Georgia, the trend in terms of results for the current year is expected to continue and the new 2024-
2026 regulatory period will begin once the foundations that will regulate the three-year Infrastructure
Master Plan and the new tariff framework have been laid.

In Saudi Arabia, development work has continued on the management projects for the two clusters
awarded to Aqualia from the six tendered by the National Water Company during 2022. An ambitious
programme is also under way to modernise and optimise the integrated water cycle services, with a view
to preparing them for the future phase of privatisation. The operation of the Jizan desalination plant will
also be consolidated with an operating contract starting for three mobile desalination plants on the Saudi
coast.

445

In Egypt, following completion of the start-up stage, Aqualia continued operating the Abu Rawash
wastewater treatment plant to full satisfaction, with a treatment capacity of 1,600,000 m3/d that
serves the western area of the city of Cairo., over a duration of 3 years. During the year, the ambitious
Desalination Plan will begin in Egypt associated with photovoltaic energy generation, where Aqualia leads a
multidisciplinary and multinational consortium.

In Algeria the two desalination plants, Mostaganem and Cap Djinet, continued to operate at full capacity
and without significant incidents, providing a critically important service to the population of the country's
most important metropolitan areas, Oran and Algiers.

In Latin America, the 20-year operating period of the Guaymas SWDP began in mid-2022 (Sonora, Mexico).
In June 2023, the contract for the Comprehensive Improvement of Management Procedures (MIG) in
Los Cabos (Baja California Sur) formally began and the operation of the El Realito aqueduct continued.
Furthermore, work will be completed on PTAR Salitre (Colombia) during the first half of 2024. In both
countries, new concessions for desalination hydraulic infrastructure will be tendered in the states of Baja
California and Sonora in Mexico and for purification.

In Peru, the State is in the process of evaluating the efficiency of its public supply services in order to give
way to private initiatives in those areas with the worst management indicators. Aqualia is developing seven
co-financed private initiatives corresponding to wastewater treatment plants and desalination plants.
Four of these projects are in the advanced structuring phase and are part of the important short term
ProInversión app project backlog.

Finally, in the USA, as a result of the efforts to acquire a platform for business development in the US
market, on 31 December 2023, FCC Aqualia USA Corp acquired 97% of Municipal District Services, Llc.
(MDS), whose main objective of which is the integrated management of water and sanitation infrastructure
in the Municipal Utility District (MUD).

Water scarcity, the obsolescence of the hydraulic infrastructures and the low penetration of private
operators in the sector are the source of the main growth opportunities for the company in certain states.
The increasingly more demanding legislation on the control and elimination of processing contaminants
for the protection of aquifers and surface water is a business opportunity to be explored in the coming
years.

446

Construction

In the international market, FCC focuses on countries and markets with a stable presence and on the
execution of projects with guaranteed financing.

The search for contracts in the domestic and international markets is one of the Group's objectives,
although this is done through demanding risk management that must provide access to a selective
backlog of projects that ensure the company's profitability and cash flow generation.

Taking into account the above, it is estimated that in 2024, the turnover obtained in Spain will remain
similar to that obtained in 2023.

In the foreign market, it is estimated that turnover in 2024 will be similar to that obtained in 2023, with
the development of large infrastructure works obtained between 2021 and 2023 and the contribution
of markets in America (USA, Canada,, Mexico, Chile, Peru), the Middle East (Saudi Arabia) and Europe
(Norway, the Netherlands, the United Kingdom, Portugal and Romania).

Cement

The cement sector in Spain has experienced a slowdown in consumption in recent months and since
September every month has seen negative growth rates.At the same time, exports continued to decline
slightly this year and imports collapsed by more than 40%.

According to estimates from the Association of National Construction Companies (SEOPAN), official
tenders up until November 2023 increased by 1.9% compared to the same period in 2022. Civil engineering
tenders saw 3.5% growth, while tenders for buildings fell by 1%. Building permits compared to 2022 grew
by 2% to 111 thousand homes and by 2024, growth is expected to continue to 116 thousand units. Non-
residential building dropped by 20% in 2023 and is expected to stabilise in 2024. In terms of investment in
infrastructure in 2024, this could be affected by budgetary restrictions as a result of the reactivation of EU
deficit rules.

According to data from the sector's employers' association, OFICEMEN, cement consumption in 2023
decreased by 3% to 14.5 Mt and according to estimates for the month of October, this volume will remain
in 2024.

In 2023, sales by the Spanish Business Unit of the Cementos Portland Valderrivas Group totalled 4.3
million tonnes of cement and clinker in the aggregate of domestic sales and exports, the same volume
seen in 2022.

In Tunisia in 2023, the domestic market came to 5 million tonnes, 9% down on 2022. According to the
Group's estimates for 2024, domestic cement consumption is expected to fall by around 4% compared to
2023. Tunisia has been immersed in an economic, social and political crisis in recent years.

In 2023, sales by the Tunisian Business Unit of the Cementos Portland Valderrivas Group came to 1.2
million tonnes of cement and clinker in the aggregate of domestic sales and exports, down by 12%
compared to 2022. The main destinations for exports were Mexico, Libya, Italy and the USA.

In this context, the Cementos Portland Valderrivas Group will continue to develop its cost and investment
optimisation policies and to adapt all its organisational structures to the reality of the various markets
in which it operates, with the aim of improving the generation of resources and support sustainable
development.

Real Estate

FCC Inmobiliaria's actions for 2024 will focus on the development of its three business lines exclusively in
Spain:

Office, premises and shopping centre rentals

In the real-estate area and in relation to service-sector assets (offices and shopping centres), where the
Company's exceptional real estate portfolio gives it a prominent position, the optimisation of services and
their management will continue to meet the new demands of tenants and environmental requirements,
with the FCC Group assuming the cost of achieving these objectives.

In 2024, the company will focus on supporting its subsidiary companies, to adapt its buildings and
business to the new trends in efficiency and sustainability of the office and shopping centre market,
adapting the commercial relationship with tenants by adapting contracts to the demands of the market,
such as the flexibility of spaces, duration, etc., increase the backlog of buildings under management
certified with the BREEAM sustainability seal and improve the performance of offices, premises and
shopping centres in terms of energy consumption, water and waste management through continuous,
automated and digital monitoring.

The main notes in this line of business include:

• Business backed by the quality of the assets where most of the offices are located in prime areas, and

also the group of shopping centres it owns, which are centres located in the shopping areas of the cities.

• Recurrence of revenues from Jezzine, the lessor of Caixabank's offices, whose lease expires in 2037.

447

Real-estate development and land management

8. R&D+I Activities

During the course of 2024, the Real Estate Area will keep development activity at similar levels to last year,
with the completion of projects in progress, as well as the start of new projects, with special attention
to their profitability, and also to the viability of their commercialisation, bearing in mind the evolution of
demand and the macro scenario of the Spanish economy, which are vital for development activities.

The land portfolio will continue to be actively managed, allowing it to be consolidated as urban land, with
the resulting increase in value and contribution to the maintenance of development activity. It will also be
possible to acquire new assets and/or land with a value path, either for their management and/or by the
market.

Rental housing

During 2023, the Group completed two Build to Rent (BTR) projects with 195 publicly protected homes
(VPPL-VPPB) intended for rent in the town of Tres Cantos (Madrid). The first of these, “Residencial Nao”
with 43 homes went on the market and operations started in April, with 100% now rented; the second,
“Residencial Provenza”, was completed in two phases, the first 50 homes went on the market and
operations started in July, with 88% rented, and the second 102 homes went on the market in September,
with 27% rented.

In addition, operations have continued at the “Jardín de Tres Cantos” residential building with 85 homes,
100% of which are rented.

The total investment made in the three Build to Rent projects, with a total of 280 homes, amounted to
€59.5 M.

In 2024, the Group will continue with the operation of Build to Rent and will analyse opportunities for the
acquisition or development of new land with the same aim of residential rental housing, provided that the
return on investment is maintained.

The FCC Group's R&D&I activities in 2023 have resulted in more than 35 projects.

These projects seek to respond to the challenges of each business area while maintaining overall
coordination between the different business Areas of the FCC Group.

The activities of the different Business Areas and the main projects developed throughout 2023 are
detailed below.

Services

In the environmental services activity, we have continued with the development of projects started in
previous years, such as:

VISION

INSECTUM

DEEP PURPLE

PLASMIX

H2TRUCK

BICISENDAS

B-FERTS

SCALIBUR

LIFE 4 FILM

ECO2D4.0

LANDFILL BIOFUEL

SEALING OF MINING DEPOSITS

MINETHIC

ECLOSION

IRRIGATION AND WASHING TANK

PV4INK

In addition, new ones have been launched during 2023, which are summarised below:

448

In the field of waste management we have 5 new projects:

There is another new project in Industrial Waste activity:

• ABATE: consists of the use of compact, high-performance marketable technologies for the reduction of

VOCs in EU waste treatment plants, reducing CO2 emissions and energy consumption.

• BIOPROLOGNO: this project pursues several objectives, (i) optimising and developing the pyrolysis
process of lignocellulosic waste using microwave technology to obtain Wood Vinegar and biochar,
(ii) obtaining and characterising the bio-products by measuring their structural characteristics, (iii)
demonstrating the agronomic characteristics of biochar as a biofertiliser and soil improver, and finally
(iv) assessing the feasibility and effectiveness of using Wood Vinegar as a substitute for synthetic
herbicides in infrastructure, roads and gardening.

• LUCRA: this project aims to demonstrate biotechnical and green processes for the production of:

biologically based succinic acid using organic waste, PU polyester polyol dispersions based on the
succinic acid of biological origin and polyester polyol resins based on the succinic acid obtained.
In short, it aims to demonstrate the sustainable production outside a laboratory of succinic acid of
biological origin and its use in the production of innovative products also of biological origin.

• MPB DEHESAS: project aimed at investigating the digestion of leachate treatment plants, specifically

leachate (i) post bio-methanization, (ii) FORS and (iii) compost.

• LIFE ZEROLANDFILLING: the aim of the project is to deploy and demonstrate, in a pioneering way and
at a semi-industrial scale, the profitability and sustainability of an innovative advanced and integrated
pilot plant to allow the treatment and chemical recycling of non-recyclable MSW that normally reaches
the landfill, revaluing it as: (i) a liquid mixture of high quality hydrocarbons known as green naphtha
for the chemical and petrochemical industries; (ii) solid charcoal for the construction industry; and (iii)
synthesis gas for self-consumption during the pyrolysis process.

In the field of specialised machinery for waste collection activities there is a new project:

• CNG SIDE LOADING BODY FOR WASHING CONTAINERS: consists of developing a new side loading

body for washing containers with a capacity of between 1,100 and 3,200 litres, with a washing chamber
made from aluminium, maximum clean water capacity up to 9,750 litres, with special interior and
exterior washing pumps to allow the containers to be washed during an entire day's work.

• COMPLAST project: the general aim of the project is to obtain new thermoplastic composites for high
added value applications in the aeronautical, railway and automotive sectors. These composites will
boast improved properties, be recyclable and/or incorporate recycled materials.

End-to-end Water Management

Innovation activity at Aqualia is aligned with the European Green Deal policies, which promotes the
transition to a circular economy with a zero carbon footprint. The Department of Innovation and
Technology (DIT) develops new services and sustainable processes using smart and eco-efficient
management tools. Thus, the DIT projects help the company to achieve the UN's Sustainable Development
Goals (SDGs), focussing on an affordable and high-quality water and sanitation service (SDG 6), an
optimised energy balance (SDG 7) without affecting the climate (SDG 13) as well as responsible
production and consumption (SDG 12).

The projects highlighted in 2023 are listed below:

• UE MSCA – REWATERGY: focussed on scientific education, within the H2020 Marie Sklodowska Curie
programme of European academic networks. It pursues technological development at its purification
plants through methods of adsorption of ammonium from wastewater and its conversion into hydrogen;
as part of the project, photo and electro-disinfection processes were assessed to eliminate micro-
pollutants in drinking water or wastewater.

• LIFE ULISES: it aims to transform conventional WWTPs into “energy and biofertiliser production

factories”, achieve energy self-sufficiency and eliminate its carbon footprint, with anaerobic pretreatment
implemented with the PUSH reactor. To improve the energy balance, bio-methane is used for the
purposes of vehicle fuel supplied at a gas service station equipped with a refining system.

• RIS3 EFLUENT-EX: its aim is to promote clean energy and the use of organic and agro-industrial waste,
with Aqualia working to convert WWTPs into bio-factories and renewable energy sources, promoting
sustainable mobility based on green biofuels.

• LIFE INTEXT: the project optimises low-cost purification technologies in small towns with a view
to minimising the energy cost, carbon footprint and waste from the treatment process. It assess
sustainable solutions from an ecological and economic perspective for settlements with less than 5,000
residents, supported by specialist SMEs from Germany, Greece and France.

449

• LIFE PHOENIX: the project optimises tertiary risk management to achieve the most ambitious

objectives of the new European regulation on water reuse, assessing effluents at several mobile plants.
These devices combine physicochemical treatments with advanced filtration and various ultra- and
nanofiltration membrane refining skids.

• LIFE ZERO WASTE WATER: the project seeks to achieve a purification process with a zero carbon

footprint. To this end an anaerobic reactor with AnMBR membranes has been set up, which produces
biogas, followed by the ELAN® process in the water line to eliminate nitrogen with low energy
consumption. The management of FORSU is assessed with the transport the mixture of organic matter
in a single stream in the sewerage system.

• LIFE INFUSION: as part of the project, new resource recovery plants have been designed using

municipal solid waste and the leachate digestion system has been optimised.

• LIFE RESEAU: the RESEAU project aims to increase the capacity and resilience of the existing sanitation
water infrastructures to the impact of climate change. The aim is to develop a flexible flow management
model.

• H2020 BBI B-FERST: project to develop new biofertilisers using urban wastewater and by-products of

agri-food industries. The potential of raw materials recovered from municipal waste and effluents in the
production of fertilisers in three countries (Spain, Italy and Czech Republic) is analysed.

• H2020 BBI DEEP PURPLE: the project implements on a demonstration scale a new biorefinery model
that integrates purple and phototrophic bacteria (PPB) in anaerobic carousels. These bacteria use
solar energy to treat wastewater without aeration, and transform the organic content of wastewater
and municipal wastes into raw materials for biofuels, plastics, cellulose and new base materials in the
chemical and cosmetics industry.

• H2020 SEA4VALUE: project focussed on recovering resources from concentrated brines in seawater

desalination stations (SWDPs). At least eight innovative technological solutions are being developed at a
basic scientific level. The aim is to enrich the most valuable components of seawater (lithium, caesium
and rubidium) and to recover critical raw materials (magnesium, boron, scandium, gallium, vanadium,
indium, molybdenum and cobalt) to a purity that allows them to be exploited on the market.

• H2020 ULTIMATE: the project consisted of the installation in the WWTP with a fluidised anaerobic
reactor (FBBR/Elsar) on an industrial scale, to recover biomethane and supply a fuel cell. The co-
digestion of residual yeast is also being studied.

• H2020 REWAISE: the project reinforces Aqualia's strategic lines of technological development, with
sustainable desalination and new membranes, the recovery of materials from brine, the reuse of
wastewater and its transformation into energy and by-products. To improve the operation and control of
the processes, work is under way on the simulation of networks and plants, optimising the efficiency of
the service as well as water quality.

• H2020 NICE: the generates scientific knowledge using nature based solutions (NBS), such as wetlands
or green walls. These elements are involved in the purification and recovery of resources from urban
wastewater.

• ECLOSION MISSIONS: project co-financed by the CDTI (Centre for Technological Development and

Innovation), its main objective is to create new materials, technologies and processes for the generation,
storage and transport of renewable and indigenous gases, such as hydrogen and biomethane. These
energy vectors will be made using urban waste, agri-food, wastewater and sewage sludge and will be
monitored using eco-efficient, flexible and smart optimisation tools.

• ZEPPELIN MISSIONS: project co-financed by the CDTI that researches a flexible series of green
hydrogen production and storage technologies based on the use of waste and by-products (agri-
food, textiles, treatment plants and refineries). The aim is to make this energy vector more efficient,
addressing the technological challenges linked to biogas and bioethanol reforming, dark fermentation,
microbial electrolysis, gasification and hydrogen storage.

• HE D4RUNOFF: develops tools to quantify, avoid and manage diffuse pollution created by urban runoff

water.

• HE CHEERS: the project aims to revalue by-products that are underused or wasted by the brewing

industry, such as bagasse, wastewater, CO2 and methane. Through a biorefinery approach, inspired by
the biodiversity of nature (insect and microbe platforms), five innovative bio-products are generated that
are competitive at a market level: insect protein, disinfectant, microbial protein, ectoin and caproic acid.

• HE NINFA: the project develops groundwater monitoring and protection systems, starting with the

measurement, modelling and treatment of different pollutants (nutrients, pesticides, pharmaceuticals,
hydrocarbons, heavy metals, micro plastics and salinity). The groundwater management and pollution
prevention strategy is structured around early detection systems, a better understanding of the effects
to achieve synergies and to control the risks of multiple disturbance factors. These elements are
combined with predictive methodologies to increase resilience and implement treatment and mitigation
solutions.

• UMI AQUATIM: its aim is to respond to current challenges, by studying and implementing new

technologies throughout the entire water cycle. Innovation, the development of new circular economy
models and digitalisation are key factors in obtaining new sources of green energy (H2 and biogas), new
natural resources and their efficient use (nutrients, metals and water). It also includes the protection
of ecosystems and biodiversity through nature-based solutions (NBS), the development of new digital
technologies (sensors, traceability, models and predictive systems) and the introduction of improvement
actions to ensure the quality of water masses.

• RESURGENCE: the project pursues a model of circularity in industrial water consumption from a broad
perspective: efficient technologies for the circularity of water, the recovery of energy and raw materials,
with a view to contributing to climate neutrality, circularity and the competitiveness of the European
Union.

In addition, during 2023, ten families of patents and brands that have continued to grow since 2014 were
maintained, with two Aqualia Industrial patents still in force.

Construction

FCC Construcción promotes an active policy of technological development, constantly bringing innovation
to its projects, with a strong commitment to research and development, sustainability and contribution
to the quality of life of society as competitive factors. This innovation policy is coordinated with all other
business Areas of the FCC Group.

The development and use of innovative technologies to carry out the works is an important contribution to
added value and is a differentiating factor in today's highly competitive and internationalised market.

The three types of projects developed by FCC Construcción and its investee companies are: internal
projects, projects with other companies in the FCC Group and projects in collaboration with other
companies in the sector or other related sectors, often with technology-based SMEs, which enables open
innovation projects to be carried out with the participation of the value chain and occasionally in horizontal
cooperation. In addition, the presence of universities and technology centres is essential in almost all
projects.

In addition, the presence of universities and technology centres is essential in almost all projects.

A number of the projects are being undertaken in coordination with the public administrations, as is the
case of CIEN "Bicisendas", as part of which several municipalities across Catalonia have been contacted
for the creation of a pilot bicycle lane.

At an international level, in 2023 work was undertaken as part of (i) the European R&D&i project
"DigiChecks", funded by the EU Research and Innovation Framework Programme, Horizon Europe, as part

450

of which a Digital Environment is being developed to facilitate interoperability and communication between
different construction industry platforms, the management of permits and controls accordingly. The
project is structured around new technologies (including BIM, GIS, Artificial Intelligence, Blockchain, Digital
Twin), using previous international initiatives as a reference, and (ii) the "EC2" project financed by EDF-DA
(European Defence Fund). The EC2 project consists of the development of software that provides the
functional capacity of strategic command and control for a future General Headquarters of the European
Union, which will help to achieve the capabilities for planning and conducting military operations, both
executive and non-executive. The system will make it possible to centralise all operating capacities in a
single point of access.

In relation to the National Projects undertaken during 2023, the development of the following projects is
worth particular note:

• BICISENDAS: part of the CDTI's CIEN 2018 programme, the objective of which is the development of a
new generation of bicycle lanes, which will be modular, produced with sustainable materials and can be
custom designed for the integration of various technologies and depending on arising to be covered sycg
as helping to increase comfort, safety, environment and communications in the bike lane environment,
thus contributing to promoting sustainable transportation.

• PRACAN: included in the call for CDTI Cooperation projects, the aim of which is to develop a robotic

platform for the identification, control and monitoring of carcinogenic agents in construction
environments. This platform will be structured around a series of mobile nodes, one land-based and
one airborne, with the ability to detect/estimate carcinogens, in particular asbestos and respirable
crystalline silica (RCS) as well as a decision-making and alarm configuration system for occupational
risk prevention (ORP) technicians, which will activate action protocols and recommendations

• ROBUST: submitted to CDTI Cooperation projects, the aim of which is to develop a georeferenced

mapping and automated monitoring system for confined environments, mainly tunnels and ditches. To
this end, it is due to use new monitoring technology that will require the development and deployment
of autonomous aerial robots (drones), as well as the design and development of control systems and
algorithms to communicate with the robots.

• SAIM: project developed by Mantenimiento de Infraestructuras, S.A., which consists of developing
a new technological solution to aid environmental management of coastal areas that allows the
ecological characterisation of the environment automatically and in real time using information from
a new sensorised data collection system, a new satellite information processing algorithm and a new
computational simulation model.

• DESIRE: project developed by FCC Industrial and Infraestructuras Energéticas. S.A. and financed by the
CDTI, its objective is to develop a prototype of a basic RPAS simulator that, with the use of the software
developed and the prototype of mixed reality glasses and the tracking system, complements the
information presented to the RPAS pilot and the camera operator.

• CYBERSEC: developed by FCC Industrial and Infraestructuras Energéticas, S.A. and financed by the

CDTI as part of the CIEN programme, this project entails research into various technologies, techniques,
tools, methodologies and knowledge aimed at developing technological solutions for securing against
cyber-attacks in highly critical connected environments, such as Industry 4.0, smart cities or critical
infrastructures.

• EDIFICTEH: collaborative project submitted to CDTI that aims to develop a new 4.0 technological
solution for the construction sector employing connected and centralised management for the
installation of facades.

• SMART CONSTRUCTION MANAGER: project presented as part of the CDTI national CIEN programme,
the objective of which is the development of a new smart and autonomous system for the control
and management of works; research into a variety of technologies that allow the main management
processes of a project to be digitised and automated, integrating them into a collaborative tool in
which the entities involved can share reliable and secure information about the progress made and the
materials used, thus promoting transparency.

• 0ACCIDNTES: project submitted as part of the CDTI's CIEN programme, the objective of which is

research into new safety and health in construction technologies with 0 accidents: development of a
comprehensive cognitive ecosystem for real-time monitoring and prediction of dangerous situations
for the safety and health of construction workers, carrying out research that facilitates the collection,
interpretation, digitization and smart and automatic management of information generated in different
construction environments, based on state-of-the-art sensors, autonomous robotic systems, cyber-
secure connectivity ecosystems and various elements of artificial intelligence.

• ESPADIN: project developed by FCC Industrial e Infraestructuras Energéticas, S.A., included in the CDTI
MISSIONS programme, the objective of which is to make collaborative technological developments
dedicated to take the sharing and use of the value of data to industrial practice under the paradigm of
the so-called shared data spaces.

• ECOLOGÍA COTORRAS: project developed by Mantenimiento de Infraestructuras, S.A., within the

framework of the industrial doctoral candidates programme organised by the Community of Madrid;
its aim is to delve into the ecology of the Argentine parrot and Kramer's parrot (and its ecological and
health impacts) to better understand how biological invasion processes work and integrate the scientific
knowledge generated into the management plans in place for these species.

451

• CLIMPORT: project submitted to the Public-Private Collaboration programme, as part of the 2021-2023

State Plan for Scientific, Technical and Innovation Research, within the framework of the Recovery,
Transformation and Resilience Plan, the main objective of which is to develop an innovative modular
system with new professional methodologies for the design and construction of port infrastructure
adapted to climate change.

• BIOPROLIGNO: project developed by Mantenimiento de Infraestructuras, S.A., submitted to the Public-
Private Collaboration programme as part of the 2021-2023 State Plan for Scientific, Technical and
Innovation Research, within the framework of the Recovery, Transformation and Resilience Plan, which
will investigate the transformation of lignocellulosic waste into bio-products for use in the maintenance
of infrastructure and green areas.

• FOTOVOLPLAS: project developed by Megaplas, S.A., submitted for one of the electrical self-

consumption grants offered by IDEA, the objective of which is the installation of photovoltaic panels
on the MEGAPLAS factory roof. The proposed installation consists of 463 LONGI SOLAR bifacial and
monocrystalline cell technology modules, specifically, the LR5-72 540 Wp HBD model and 2 HUAWEI
Smart PV String-type photovoltaic inverters, model SUN2000-100KTL-M1.

Research, Development and Innovation (R&DI) is expressly contemplated in the Sustainability
Management System under procedure PR/FCC-730. The company holds an RD&I Management System
Certificate: RD&I Management System requirements based on Spanish-harmonised standard UNE
166002:2021, certified by AENOR, the Spanish Standardisation and Certification Association. MATINSA
and FCC Industrial and Infraestructuras Energéticas are also R&D&i Management System certified
pursuant to UNE 166002:2021.

Cement

In 2023, the project involving the ASSESSMENT OF THE POTENTIAL FOR GEOLOGICAL CO2 STORAGE, in
collaboration with the Geological and Mining Institute of Spain and the Oficemen Group, was completed.

Las conclusiones principales del estudio han sido el desarrollo de escenarios para el eventual despliegue
de las tecnologías de captura, uso y almacenamiento de CO2 en el sector evaluando sus posibilidades y
costes asociados.

452

9. Other relevant information.
Share performance and other information

10. Definition of alternative performance measures
according to ESMA regulations (2015/1415en)

9.1. Share performance

EBITDA

Attached is a table detailing the performance of FCC's shares during the year compared to the previous
year.

We define EBITDA as earnings from continuing operations before tax, earnings of companies accounted
for using the equity method, financial result, depreciation and amortisation charges, impairment, gains
or losses on disposals of non-current assets, grants, net changes in provisions and other non-recurring
revenues and expenses.

Closing price (€)*

Change in the period

Maximum (€)*

Minimum (€)*

Average daily trading (no. of shares)

Average daily trading (million euros)

Capitalisation at end of period (million euros)

No. outstanding shares

* Adjusted by scrip dividend for 2022 and 2023.

9.2. Dividends

The Company's Board of Directors, at its meeting held on 28 June 2023, agreed to implement the
agreement on the distribution of the scrip dividend adopted for the sum of €0.50/share, at FCC's General
Shareholders' Meeting on 14 June 2023, in item 7 of the Agenda, in compliance with the terms and
conditions agreed at the General Shareholders' Meeting. Subsequently, at the end of the first six months
of the year, in July, the holders of 99.18% of the free allocation rights chose to receive new shares, up on
previous years. Therefore, the increase in paid-up capital stood at 22,697,739 shares.

Jan. – Dec. 2023

Jan. – Dec. 2022

14.56

69.1%

15.40

8.16

55,044

0.6

6,350

8.32

-20.4%

10.50

7.08

51,109

0.5

3,866

436,106,917

438,344,983

EBITDA

Operating profit/(loss)

Amortisation of fixed assets and allocation of grants for non-financial and
other assets

Impairment and gains/(losses) on disposal of fixed and non-current assets

Other gains/(losses)

Dec. 2023

Dec. 2022

910.3

587.4

47.0

-15.1

610.5

512.1

174.9

13.9

1,529.6

1,311.4

Its calculation is justified by the wide use of this indicator by the different agents of the financial markets,
as it is a measure of the operating profit generated before depreciation and amortisation, which does not
imply a cash flow for the company and does not depend on its capital structure.

EBIT

This corresponds to the operating profit/(loss) in the consolidated income statement presented in the
accompanying consolidated financial statements.

Its calculation is justified by the wide use of this indicator in the economic and financial field, as it is a
measure of the operating profit obtained after the amortisation and depreciation of assets that allows the
comparison of the company's results without taking into account its capital structure.

Consolidated Group | Management Report | Page 37 of 46

453

Backlog

Net financial debt

As at any given date, the backlog reflects pending production, that is, amounts under contracts or client
orders, net of taxes on production, less any amounts under those contracts or orders that have already
been recognised as revenue. We value pending production according to current prices as at the date of
calculation. We include in backlog only amounts to which clients are obligated by a signed contract or firm
order.

At the Environment division, we recognise the backlog for our waste management contracts only when the
relevant contract grants us exclusivity in the geographical area where the plant, landfill or other facility is
located.

In our Water business area, we calculate initial backlog on the basis of the same long-term volume
estimates that serve as the basis for our contracts with clients and for the tariffs set in those contracts.

In our Construction business area, we recognise the backlog only when we have a signed contract with,
or a firm order from, the end client. Once we have included a contract in our backlog, the value of pending
production under that contract remains in backlog until fulfilled or cancelled. However, we do adjust the
values of orders in the backlog as needed to reflect any price or schedule changes that may be agreed
with the client. For example, after the date of calculation, a price may increase or decrease as a result of
changes in contractual production due to additional works to be performed. Due to a number of possible
factors, we could fail to realise as revenue part or all of our calculated backlog with regard to a given
contract or order. Our backlog is subject to adjustments and project cancellations and is, therefore, an
uncertain indicator of future earnings.

Net financial debt is defined as total gross financial debt (current and non-current) less current financial
assets, cash and other cash equivalents. The numerical breakdown is provided in note 29 to these
consolidated financial statements.

Helps to determine the situation of a company in terms of its financial debt obligations before third parties
from outside the Group, less its cash and equivalents. It is often used to assess the solvency of a company
and calculate financial indicators.

EBITDA Margin

Considered as EBITDA (or gross operating profit) divided by Net Turnover in each case.

A measure of a company's operating profit compared to its income. Used to determine the efficiency of the
operating activities it performs.

EBIT margin

Considered as EBIT (or operating profit) divided by Net Turnover in each case.

A measure of a company's net operating profit compared to its income, before paying taxes and interests.

We do not calculate the Cement area's backlog due to the typically short-term nature of the order cycle.

Working capital

In the Real Estate area, the real estate portfolio corresponds to the amount of the collection corresponding
to the sales of properties pending formalisation at the end of the period in the Development activity.
The GAV at the market value of the real estate assets as determined by independent experts and the
occupancy rate at the occupied surface area of the portfolio of rental property assets divided by the
portfolio's operating surface area.

The part of Current Assets financed using long-term funds (Non-Current Liabilities and Net Equity). It is
calculated as the sum of Current Assets minus the sum of Current Liabilities.

This is an important when it comes to obtaining an insight into the company's capacity to continue
performing its activities and assessing its liquidity to meet short-term obligations.

We calculate the backlog for our Environment, Water and Construction areas because these businesses
are characterised by medium and long-term contracts. This indicator is a measure of the expected future
income of certain areas of the company.

Net cash with recourse

It is defined as Cash and other equivalent liquid assets, plus short-term Financial Assets, minus the
Gross Financial Debt, of the parent company and that of those subsidiary companies that are financially
guaranteed with the equity of the forementioned parent company.

Helps to determine the situation of a company in terms of cash and equivalents less its financial debt
obligations before third parties from outside the Group. It is often used to assess the solvency of a
company and calculate financial indicators.

Gross financial debt

Debts with credit institutions, debt instruments and loans, financial lease payables and other financial
borrowings from third parties, joint ventures and associates on the Liabilities side of the consolidated
balance sheet.

Its calculation provides an overview of a company's financial debt obligations, determining future
maturities and its financial situation.

Economic value generated and distributed

Both indicators are calculated pursuant to GRI 201 (2016). Below is the formula for calculating both
indicators, facilitating, as applicable, the reconciliation of the corresponding items of the financial
statements (in thousands of euros):

454

Economic value generated

Turnover

From renewable sources

Other operating income

Financial income

Economic value distributed

Operating costs

Supplies

Other operating expenses

Changes in inventory of finished products and
products in progress

Employees

Staff costs

Capital suppliers

Financial expenses

(-) Other financial profit/(loss)

Taxes

Corporate income tax

Community

Economic value retained

2023

2022

8,039,315

7,705,687

333,628

6,965,466

4,518,220

9,359,423

9,026,016

333,407

8,273,550

5,367,165

288,480

45,148

3,004,337

1,540,539

-26,656

257,555

75,852

3,700,000

1,677,916

-10,751

2,474,449

2,238,733

2,474,449

2,238,733

244,201

134,635

225,824

18,377

186,635

164,240

-29,605

72,723

1,155

1,073,849

186,635

1,100

1,085,873

"Community" includes donations to non-profit organisations.

Information on the creation and distribution of economic value reflects the economic profile of an
organisation and is useful when it comes to looking at how a company generates wealth, through the
direct monetary value added to the economies in which it operates. In relation to the headings on the
income statement, balance sheet and statements of cash flows provided in note 2.1 of the management
report, the following reflects their reconciliation with the corresponding headings on the financial
statements of the FCC Group shown in italics:

Income statement

(Millions of Euros)

Income statement

Revenue

Self-constructed assets

Other operating income

Changes in finished goods and work in progress inventories

Procurements

Staff costs

Other operating expenses

Gross operating profit (EBITDA)

EBITDA Margin

Provision for amortisation of fixed and non-current assets

Amortisation of fixed assets and allocation of grants for non-financial and
other assets

Non-financial and other capital grants taken to income (*)

Other operating income/(losses)

Impairment and gains/(losses) on disposal of fixed assets

Other gains/(losses)

Non-financial and other capital grants taken to income (*)

Dec. 23

Dec. 22

9,026.0

7,705.7

Net operating profit (EBIT)

87.7

257.5

10.8

-3,700.0

-2,474.5

-1,677.9

1,529.6

16.9%

-596.9

-587.4

-9.5

-22.4

-47.0

15.0

9.5

74.1

288.5

26.6

-3,004.3

-2,238.7

-1,540.5

1,311.4

17.0%

-519.7

-512.0

-7.7

-181.1

-174.9

-13.9

7.7

EBIT margin

Financial income

Finance expenses

Other financial profit/(loss)

P/L of companies accounted for by the equity method

Profit/(loss) before tax from continuing activities

Company tax on profits

Income tax

Income from continuing operations

Net Income

Consolidated profit/(loss) for the year

Non-controlling interests

Profit/(loss) attributable to non-controlling interests

Profit attributable to the Parent

455

(Millions of Euros)

Dec. 23

Dec. 22

910.3

10.1%

-150.0

75.8

-225.8

-18.4

174.0

915.9

-171.1

744.8

-153.8

591.0

610.5

7.9%

-119.1

45.1

-164.2

29.6

550.7

-72.7

477.9

-162.7

315.2

(*) In the financial statements, the heading "Amortisation of fixed assets and allocation of grants for non-financial and other assets"
includes Apportionment of grants for fixed and non-current assets and others", which in the management report is included under
"Other operating profit/(loss)".

Balance Sheet

Intangible assets

Property, plant and equipment

Investment property

Investments accounted for using the equity method

Non-current financial assets

Deferred tax assets and other non-current assets

Non-current assets

Inventory

Trade and other receivables

Other current assets

Other current financial assets

Cash and cash equivalents

Current assets

TOTAL ASSETS

(Millions of Euros)

Balance Sheet

Dec. 23

Dec. 22

2,483.5

3,829.8

2,091.3

1,034.3

748.4

468.3

2,342.1

3,496.8

2,122.9

502.6

910.6

499.5

Equity attributable to shareholders of the parent company

Non-controlling interests

Equity

Grants

Non-current provisions

Long-term financial debt

10,655.7

9,874.5

Non-current financial liabilities

1,234.3

2,957.4

2,886.5

70.9

260.5

1,143.2

2,468.0

2,409.3

58.7

221.3

Other non-current financial assets not included in financial debt (*)

Other non-current financial liabilities

Other non-current financial assets not included in financial debt (*)

Deferred tax liabilities and other non-current liabilities

Deferred tax liabilities

1,609.7

1,575.5

Other non-current liabilities

456

(Millions of Euros)

Dec. 23

Dec. 22

4,450.1

1,695.9

6,146.0

226.6

1,230.6

4,361.0

4,817.0

-456.0

456.0

434.1

284.2

149.9

3,387.9

1,551.1

4,939.0

202.9

1,141.7

3,860.7

4,271.3

-410.6

410.6

430.7

282.0

148.7

6,062.0

5,408.0

Non-current liabilities

6,708.3

6,046.6

16,717.7

15,282.5

Current provisions

Short-term financial debt

Current financial liabilities

Other current financial assets not included in financial debt (*)

Other current financial liabilities

Other current financial assets not included in financial debt (*)

Trade and other payables

Current liabilities

TOTAL LIABILITIES

159.6

604.1

926.8

-322.7

322.7

148.1

1,121.8

1,333.1

-211.3

211.3

2,777.0

2,815.7

3,863.4

4,296.9

16,717.7

15,282.5

(*) Non-current and current "Other financial liabilities" include amounts that form part of the financial debt and others that do not.
Financial debt is included under "Long/short-term financial debt" and non-financial debt are reported under "Other non-current/
current financial liabilities" in the management report.

11. Annual Corporate Governance Report

The Annual Corporate Governance Report is available on the website of the National Securities Market
Commission and on the issuer's website.

https://www.cnmv.es/portal/consultas/ee/informaciongobcorp.aspx?TipoInforme=1&nif=A-
28037224&lang=en

12. Annual Directors' Remuneration Report

The Annual Directors' Remuneration Report is available on the website of the National Securities Market
Commission and on the issuer's website.

https://www.cnmv.es/portal/consultas/ee/informaciongobcorp.aspx?TipoInforme=6&nif=A-
28037224&lang=en

Consolidated Group | Management Report | Page 41 of 46

Cash flow

Gross Operating Profit (EBITDA)

Profit/(loss) before tax from continuing operations

Amortisation and depreciation

Impairment and gains/(losses) on disposal of fixed assets

Other adjustments to profit/(loss) (net) (*)

(Increase)/decrease in working capital

Changes in working capital

Corporation tax (paid)/received

Other operating cash flow

Dividend collections

Other adjustments to profit/(loss) (net) (*)

Operating cash flow

Investment payments

Proceeds from divestments

Other investment cash flows

Investment cash flow

Interest paid

(Payment)/receipt of financial liabilities

Other financing cash flow

Issuance/(amortisation) of equity instruments

(Acquisition)/disposal of own shares

Dividends paid and payments on equity instruments

Other collections/(payments) from financing activities

Financing cash flow

Exchange differences, change in consolidation scope, etc.

Increase/(decrease) in cash and cash equivalents

(Millions of Euros)

Dec. 23

Dec. 22

1,529.6

1,311.4

915.9

596.9

47.0

-30.2

-691.4

-124.2

71.4

70.2

1.2

550.7

522.2

174.9

63.6

285.3

0.7

-51.6

40.2

-91.8

785.4

1,545.8

-1,104.6

-1,062.1

36.2

106.0

-962.4

-172.5

-113.8

496.6

-0.4

575.7

-80.8

2.1

210.3

1.0

34.2

51.5

72.6

-938.0

-123.7

-333.9

-109.6

-0.3

-39.1

-73.2

3.0

-567.2

-0.6

40.0

(*) "Other adjustments to net income" on the financial statements is divided into two subheadings on the statement of cash flows in
the management report, taking EBITDA as a starting point and not the "Profit/(loss) before tax from continuing operations".

458

Audit Report on Consolidated Financial Statements
issued by an Independent Auditor

FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. AND
SUBSIDIARIES
Consolidated Financial Statements and
Consolidated Management Report
for the year ended
December 31, 2023

Ernst & Young, S.L.
C/ Raimundo Fernández Villaverde, 65
28003 Madrid

Tel: 902 365 456
Fax: 915 727 238
ey.com

AUDIT REPORT ON CONSOLIDATED FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT
AUDITOR

Translation of a report and financial statements originally issued in Spanish. In the event of discrepancy, the
Spanish-language version prevails

To the shareholders of Fomento de Construcciones y Contratas, S.A.:

Audit report on the consolidated financial statements

Opinion

We have audited the consolidated financial statements of Fomento de Construcciones y Contratas,
S.A. (the parent) and its subsidiaries (the Group), which comprise the consolidated balance sheet at
December 31, 2023, the consolidated income statement, the consolidated statement of recognised
income and expense, the total statement of changes in the consolidated equity, the statement of
consolidated cash flow, and the notes thereto, for the year then ended.

In our opinion, the accompanying consolidated financial statements give a true and fair view, in all
material respects, of consolidated equity and the consolidated financial position of the Group at
December 31, 2023 and of its financial performance and its consolidated cash flows, for the year
then ended in accordance with International Financial Reporting Standards, as adopted by the
European Union (IFRS-EU), and other provisions in the regulatory framework applicable in Spain.

Basis for opinion

We conducted our audit in accordance with prevailing audit regulations in Spain. Our responsibilities
under those standards are further described in the Auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.

We are independent of the Group in accordance with the ethical requirements, including those related
to independence, that are relevant to our audit of the consolidated financial statements in Spain as
required by prevailing audit regulations. In this regard, we have not provided non-audit services nor
have any situations or circumstances arisen that might have compromised our mandatory
independence in a manner prohibited by the aforementioned requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.

Domicilio Social: Calle de Raimundo Fernández Villaverde, 65. 28003 Madrid - Inscrita en el Registro Mercantil de Madrid, tomo 9.364 general, 8.130 de la sección 3a del Libro de Sociedades,
folio 68, hoja nº 87.690-1, inscripción 1a. C.I.F. B-78970506.

A member firm of Ernst & Young Global Limited.

Consolidated Group | Management Report | Page 43 of 46

459

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the consolidated financial statements of the current period. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole, and in
forming our audit opinion thereon, and we do not provide a separate opinion on these matters.

Recoverability of the deferred tax assets of the Spain Tax group

Description As explained in note 23 to the accompanying consolidated financial statements, at 31

December 2023 the Group recognised deferred tax assets on the consolidated
balance sheet for the Spain Tax Group amounting to 540.019 thousand euros.

According to the accounting policy described in note 3.q to the accompanying
consolidated financial statements, the Group recognises deferred tax assets except in
cases where there are reasonable doubts about their future recovery.

The assessment made to determine the recoverable amount of these assets requires
Group management to make complex judgements regarding the estimates of the
future taxable profit of the companies comprising the Spain Tax Group based on
financial projections and business plans considering applicable tax laws and
accounting standards.

Given the complexity inherent in management's projections of business performance
to estimate future taxable profits of the companies comprising the Spain Tax Group
and the significance of the amounts involved, we determined this to be a key audit
matter.

Our
response

Our audit procedures related to this matter included:



Understanding the process designed by Group management to assess the
recoverability of deferred tax assets and assessing the design and
implementation of the relevant controls in place in that process.

Assessing the reasonableness of the key assumptions used by Group
management to estimate the period for recovering deferred tax assets, focusing
on the economic, financial and tax assumptions used to estimate the future
taxable profits of the Spain Tax Group based on budgets, business performance
and historical experience.

Assessing, with the involvement of our tax specialists, the key assumptions
made by Group management regarding applicable tax laws.

Testing how sensitive the results are to reasonably possible changes in the key
assumptions made.

► Reviewing the disclosures made in the notes to the consolidated financial

statements and assessing whether they are in conformity with the applicable
financial reporting framework.

Recognition of revenue from long-term contracts in the Construction segment

Description As explained in note 3.s to the accompanying consolidated financial statements,

performance obligations in the construction activity are satisfied over time, so
revenue is recognised using the percentage of completion method.

The recognition of revenue from long-term construction contracts requires Group
management to make significant estimates regarding, e.g. total contract costs to be
incurred, estimated contract revenue and, where appropriate, the amount of contract
modifications and claims relating to, e.g. the total costs to be incurred, the estimate
of expected revenue and, where appropriate, the amount of contract modifications
that will finally be accepted by the customer.

Given the significance of the amounts involved since this affects a large portion of
total "Revenue" and the measurement of completed work pending certification
recognised under "Trade and other receivables", which amounted to 554,475
thousand euros at 31 December 2023, and the complexity required to make these
estimates, which requires Group management to make judgements in determining the
assumptions used, which means changes in those assumptions could give rise to
material differences in the amount of revenue recognised, we determined this to be a
key audit matter.

Information on the applicable measurement standards and the disclosures for
revenue and the aforementioned accounts receivable are provided in notes 3.s, 15.a
and 26.a to the accompanying consolidated financial statements.

Our
response

Our audit procedures related to this matter included:



Understanding the process designed by Group management to recognise
revenue, assessing the design and implementation of the relevant controls in
place in that process, and verifying the operating effectiveness of those
controls for the main components of the Group that have this type of contract.

Selecting a sample of projects from the Group's main components with this type
of contract, for which we obtained the related contracts to read and understand
the most important clauses and their implications, and, e.g. budgets, internal
assessments of revenue recognition, certifications, follow-up presentations on
the execution of projects and amounts received.

Assessing for these contracts the reasonableness of Group management's
assumptions through meetings with technical staff and project managers, and
analysing the reasons for deviations between originally planned and actual costs
and their impact on estimated project margins.

Assessing the reasonableness of estimates of completed work pending
certification recognised as revenue at year-end, checking the status of
negotiations of the main customer contracts, and reviewing the reasonableness
of documents supporting the probability of recovery.

Assessing the reasonableness of Group management's approach for recognising
and measuring contract modifications and claims submitted, covering especially
the estimate of amounts expected to be recovered and the probability of
success.

Reviewing the disclosures made in the notes to the consolidated financial
statements and assessing whether they are in conformity with the applicable
financial reporting framework.

A member firm of Ernst & Young Global Limited.

Consolidated Group | Management Report | Page 44 of 46

460

Measurement of investment properties and inventories

Measurement of the investment in Metrovacesa, S.A.

Description At 31 December 2031, the Group recognised an amount of 2,091,328 thousand

Description As explained in note 13.a to the accompanying consolidated financial statements, the

euros in the consolidated balance sheet under "Investment properties" related mainly
to office buildings and shopping centres held to earn rentals or for capital
appreciation, and 719,718 thousand euros under "Inventories" relating to land,
developments in progress and other properties held for sale or inclusion in a real
estate development.

Group management determines the fair value of investment properties on a half-
yearly basis by reference to appraisals performed by independent experts to reflect
current market conditions at year-end. It also determines whether an item of
inventory is impaired by engaging independent experts to estimate the fair value of
the main assets included in inventories.

Given the significance of the amounts involved and the complexity of the process
used to identify indications of impairment and measure investment properties and
inventories to determine recoverable amount for the purpose of assessing potential
impairment, which requires Group management and independent experts to make
significant estimates in applying judgements to determine the assumptions used (in
particular, assumptions underlying estimated rents, discount rates and exit yields
used for investment properties and, development, construction and marketing costs
for inventories, and the periods used to estimate future cash flows from investment
properties), we determined this to be a key audit matter.

Information on the measurement standards for investment properties and inventories
is provided in note 3.e and 3.j to the consolidated financial statements. Information
on the approaches and main assumptions used in the valuations and sensitivity
analyses is provided in notes 8 and 14 to the consolidated financial statements.

Our
response

Our audit procedures in relation to this matter included:

► Understanding the process designed by Group management to determine

whether there are indications of impairment and to determine the recoverable
amount of items of "Investment properties" and "Inventories", and assessing
the design and implementation of the relevant controls in place in that process.

► Reviewing the appraisal models used by independent experts to determine

recoverable amounts, with the involvement of our valuation specialists,
covering especially, for a sample of the appraisals performed, the model's
mathematical coherence, and assessing the reasonableness of the rents used
and/or the peers used, the discount rates and exit yields for investment
properties, and the development, construction and marketing costs and periods
used to estimate the future cash flows associated with land held in inventories,
and analysing the sensitivity analyses performed by independent experts,
including the performance of valuation testing procedures, where necessary.

► Reviewing, for a sample of appraisals by independent experts, whether the
rents used in the valuations take into account lease contracts in force.

► Reviewing the disclosures made in the notes to the consolidated financial

statements and assessing whether they are in conformity with the applicable
financial reporting framework.

Group recorded equity instruments related to Metrovacesa shares representing
13.81% of share capital at a carrying amount of 133,471 thousand euros in “Current
financial assets” on the balance sheet as at 31 December 2022. These equity
instruments were classified as financial assets at fair value through equity.

In addition, as explained in note 4.b to the accompanying consolidated financial
statements, during the year ended 31 December 2023, the Group acquired an
additional share of Metrovacesa, S.A., increasing its net share in the company to
21.21%, and obtained representation on the company’s governing bodies. As a result,
Group management considers that it currently has significant influence over the
Company.

According to the accounting policy described in note 2.b of the accompanying
consolidated financial statements, the investments over which the Group does not
exercise control but does have significant influence are included in “Investments
accounted for using the equity method” on the consolidated balance sheet and are
shown net of the Group’s share in the after tax profit or loss of these companies in
“Share of profit(loss) of companies accounted for using the equity method” in the
consolidated income statement.

The change in the classification of this investment required recognition of profit
amounting to 142,413 thousand euros in “Profit/(loss) of entities valued using the
equity method” in the consolidated income statement, due to the difference between
the fair value its net assets and their listed value at the date they were included in the
consolidation scope.

Consequently, at 31 December 2023, the investment in Metrovacesa, S.A. amounts
to 402,120 thousand euros and is recorded in “Investments accounted for using the
equity method”.

Due to the complexity of the judgments made by Group management that are
inherent in measuring this investment, and given the significant impact that the
changes in the assumptions made could have on the accompanying consolidated
financial statements and the relevance of the amounts involved, we have determined
this to be a key audit matter.

Information on the measurement standards used and the related disclosures are
provided in notes 4.b, 11.b, 17, 26.h and 30.d to the accompanying consolidated
financial statements.

Our
response

Our audit procedures related to this matter included:

► Understanding Group management's process for determining and accounting

for the fair value of the investment.

► Reviewing the documentation supporting the increase in the Group’s share of

the investment and the amount paid.

► Reviewing the accounting impact of the change in the classification of the

investment, verifying that it was correctly recorded in the consolidated financial
statements.

► Assessing Group management’s conclusion that the increase in the share of this

investment constitutes having significant influence over the company.

A member firm of Ernst & Young Global Limited.

Consolidated Group | Management Report | Page 45 of 46

461

► Assessing, in collaboration with valuation specialists, the methodology used to

determine the fair value of real estate assets classified as inventory in
Metrovacesa, S.A., checking its consistency in accordance with the applicable
financial reporting framework, focusing specifically on mathematical coherence
and evaluating the reasonableness of the assumptions made in connection with
the valuations carried out by independent experts on a sample of real estate
assets.

► Reviewing the disclosures made in the notes to the consolidated financial

statements and assessing whether they are in conformity with the applicable
financial reporting framework.

Other information: consolidated management report

Other information refers exclusively to the 2023 consolidated management report, the preparation
of which is the responsibility of the parent company’s directors and is not an integral part of the
consolidated financial statements.

Our audit opinion on the consolidated financial statements does not cover the consolidated
management report. Our responsibility for the consolidated management report, in conformity with
prevailing audit regulations in Spain, entails:

Checking only that the consolidated non-financial statement and certain information included
in the Annual Corporate Governance Report and in the Annual Directors' Remuneration
Report, to which the Audit Law refers, was provided as stipulated by applicable regulations
and, if not, disclose this fact.

Assessing and reporting on the consistency of the remaining information included in the
consolidated management report with the consolidated financial statements, based on the
knowledge of the Group obtained during the audit, in addition to evaluating and reporting on
whether the content and presentation of this part of the consolidated management report are
in conformity with applicable regulations. If, based on the work we have performed, we
conclude that there are material misstatements, we are required to disclose this fact.

Based on the work performed, as described above, we have verified that the information referred to
in paragraph a) above is provided as stipulated by applicable regulations and that the remaining
information contained in the consolidated management report is consistent with that provided in the
2023 consolidated financial statements and its content and presentation are in conformity with
applicable regulations.

Responsibilities of the parent company´s directors and the Audit and Control Committee for the
consolidated financial statements

The directors of the parent company are responsible for the preparation of the accompanying
consolidated financial statements so that they give a true and fair view of the equity, financial
position and results of the Group, in accordance with IFRS-EU, and other provisions in the regulatory
framework applicable to the Group in Spain, and for such internal control as they determine is
necessary to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the directors of the parent company are
responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Group or to cease operations, or has no realistic alternative
but to do so.

The Audit and Control Committee is responsible for overseeing the Group’s financial reporting
process.

Auditor’s responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with prevailing audit regulations in Spain will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with prevailing audit regulations in Spain, we exercise professional
judgement and maintain professional skepticism throughout the audit. We also:



Identify and assess the risks of material misstatement of the consolidated financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.

Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Group to cease to
continue as a going concern.



Evaluate the overall presentation, structure and content of the consolidated financial
statements, including the disclosures, and whether the consolidated financial statements
represent the underlying transactions and events in a manner that achieves fair presentation.

A member firm of Ernst & Young Global Limited.

Consolidated Group | Management Report | Page 46 of 46

462

Additional report to the Audit and Control Committee of the parent company

The opinion expressed in this audit report is consistent with the additional report we issued to the
Audit and Control Committee of the parent company on February 29, 2024.

Term of engagement

The ordinary general shareholders’ meeting held on June 2, 2020 appointed us as auditors of the
Group for 3 years, commencing on December 31, 2021.

ERNST & YOUNG, S.L.
(Registered in the Official Register of
Auditors under No. S0530)

(Signature on the original in Spanish)

_______________________________
Fernando González Cuervo
(Registered in the Official Register of
Auditors under No. 21268)

February 29, 2024



Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance of
the group audit. We remain solely responsible for our audit opinion.

We communicate with the Audit and Control Committee of the parent company regarding, among
other matters, the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.

We also provide the Audit and Control Committee of the parent company with a statement that we
have complied with relevant ethical requirements, including those related to independence, and to
communicate with them all matters that may reasonably be thought to bear on our independence,
and where applicable, related safeguards.

From the matters communicated with the Audit and Control Committee, we determine those matters
that were of most significance in the audit of the consolidated financial statements of the current
period and are therefore the key audit matters.

We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter.

Report on other legal and regulatory requirements

European single electronic format

We have examined the digital files of the European single electronic format (ESEF) of Fomento de
Construcción y Contratas, S.A. and subsidiaries for the 2023 financial year, which include the XHTML
file containing the consolidated financial statements for the year, and the XBRL files as labeled by the
entity, which will form part of the annual financial report.

The directors of Fomento de Construcción y Contratas, S.A. are responsible for submitting the annual
financial report for the 2023 financial year, in accordance with the formatting and mark-up
requirements set out in Delegated Regulation EU 2019/815 of 17 December 2018 of the European
Commission (hereinafter referred to as the ESEF Regulation). In this regard, the Annual Corporate
Governance Report and the Annual Directors' Remuneration Report have been incorporated by
reference in the consolidated management report.

Our responsibility consists of examining the digital files prepared by the directors of the parent
Company, in accordance with prevailing audit regulations in Spain. These standards require that we
plan and perform our audit procedures to obtain reasonable assurance about whether the contents of
the consolidated financial statements included in the aforementioned digital files correspond in their
entirety to those of the consolidated financial statements that we have audited, and whether the
consolidated financial statements and the aforementioned files have been formatted and marked up,
in all material respects, in accordance with the ESEF Regulation.

In our opinion, the digital files examined correspond in their entirety to the audited consolidated
financial statements, which are presented and have been marked up, in all material respects, in
accordance with the ESEF Regulation.

A member firm of Ernst & Young Global Limited.

1_
Letter from the
Chairwoman and CEO

2_
Ethical governance
at the highest level

3_
Strategy and
value creation

FCC in 2023

Business lines

A1_
Financial
Statements

A2_
Sustainability
Report

FCC. Annual Report 2023

463

Fomento de Construcciones y Contratas, S.A.

Balance sheet at year-end 2023 _ 464

Income statements corresponding to the business year _ 466

Statement of changes in net equity for the business year _ 467

Cash flow statement for the business _ 469

Notes to the financial statements _ 471

Management Report _ 515

Fomento de Construcciones y Contratas, S.A. | Balance sheet at year-end 2023 | Page 1 of 2

Balance sheet at year-end 2023
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

464

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportA S S E T S31/12/202331/12/2022 NON-CURRENT ASSETS 3,883,749 3,606,009Intangible assets (Note 5) 4,366 5,496Property, plant and equipment (Note 6) 23,953 26,762Land and buildings11,672 11,718 Other intangible assets12,281 15,044 Long-term investments in Group and associates (Notes 9.a and 19.b) 3,717,258 3,418,265Equity instruments3,296,179 3,002,856 Loans to companies421,079 415,409 Long-term financial investments (Note 8.a) 20,360 20,414Deferred tax assets (Note 16) 117,812 135,072CURRENT ASSETS 640,279 302,527Trade receivables and other accounts receivable 63,083 88,848Trade receivables for sales and services (Note 18)2,615 8,042 Clients, Group companies and associates (Note 19.b)12,047 26,186 Receivables from the public administrations (Note 16.a)48,004 54,023 Other receivables417 597 Short-term investments in Group and associates (Notes 9.b and 19.b) 409,471 199,452Short-term financial investments (Note 8.b) 1,198 3,644Cash and cash equivalents (Note 10) 166,527 10,583TOTAL ASSETS 4,524,028 3,908,536Fomento de Construcciones y Contratas, S.A. | Balance sheet at year-end 2023 | Page 2 of 2

Balance sheet at year-end 2023

FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

465

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportEQUITY AND LIABILITIES31/12/202331/12/2022 EQUITY (Note 11) 3,207,375 2,356,749Shareholders’ equity 3,207,375 2,356,749 Capital 436,107 438,345 Share premium 1,673,477 1,673,477 Reserves 2,348,223 2,619,098 Shares and equity interests (410) (27,264) Prior years' losses (2,392,774) (2,392,774) Profit for the year 1,142,752 45,867 NON-CURRENT LIABILITIES 927,220 917,811Long-term provisions (Note 12) 120,371 110,896Non-current payables (Note 13) 1 29Long-term payables to Group companies and associates (Note 9.c) 806,479 806,479Deferred tax liabilities (Note 16) 369 407CURRENT LIABILITIES 349,433 633,976Short-term provisions 1,883 2,069Current payables (Note 13) 73 180,117Debt instruments and other marketable securities− 23,200 Bank borrowings73 155,837 Other financial liabilities− 1,080 Short-term payables to Group companies and associates (Notes 9.d and 19.b) 362,650 413,058Trade and other payables 24,827 38,732Suppliers977 2,861 Suppliers, Group companies and associates (Note 19.b)2,090 11,964 Other payables to public administrations (Note 16.a)1,022 2,924 Other payables 20,738 20,983 TOTAL EQUITY AND LIABILITIES 4,524,028 3,908,536Fomento de Construcciones y Contratas, S.A. | Income statements corresponding to the business year

Income statements corresponding to the business year
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

466

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report 31/12/2023 31/12/2022 CONTINUING OPERATIONS Revenue (Note 18)95,270 115,020 Trade receivables for sales and services61,237 84,479 Income from interests in Group companies and associates (Note 19.a)14,286 15,822 Financial income from marketable securities and other financial instruments in Group companies and associates (Notes 18 and 19.a)19,747 14,719 Other operating income38,865 37,239 Staff expenses (Note 18)(24,354) (28,631) Other operating expenses (Note 18)(56,249) (75,328) Depreciation and amortisation (Notes 5 and 6)(5,585) (5,891) Provision surpluses (Note 12)639 5,920 OPERATING PROFIT(LOSS)48,586 48,329 Financial income (Note 18)3,457 168 Interests in equity instruments in third parties− 34 From marketable securities and other financial instruments of third parties3,457 134 Financial expenses(47,485) (38,218) Payables to Group companies and associates (Note 19.a)(38,039) (34,830) On payables to third parties(9,446) (3,388) Change in fair value of financial instruments (Note 8.a)436 2,441 Exchange differences91 (3,571) Impairment losses and gains/(losses) on disposal of financial instruments (Note 9)1,151,511 (68,321) FINANCIAL PROFIT/(LOSS)1,108,010 (107,501) PROFIT BEFORE TAX1,156,596 (59,172) INCOME TAX (Note 16)(13,844) 105,039 PROFIT FOR THE BUSINESS YEAR FROM CONTINUING OPERATIONS1,142,752 45,867 PROFIT FOR THE YEAR 1,142,752 45,867 Fomento de Construcciones y Contratas, S.A. | Statement of changes in net equity for business year | Page 1 of 2

Statement of changes in net equity for the business year
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

467

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportA) Statement of recognised income and expense31/12/2023 31/12/2022Profit per income statement1,142,752 45,867 Income and expenses recognised directly in equity436 −Write-offs to income statement(436) −TOTAL RECOGNISED INCOME AND EXPENSE1,142,752 45,867 468

Fomento de Construcciones y Contratas, S.A. | Statement of changes in net equity for business year | Page 2 of 2

Statement of changes in net equity for the business year
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

B) Statement of changes in equity

Equity at 31 December 2021

425,174

1,673,477

2,386,556

(26,674)

(2,392,774)

274,497

2,340,256

Share capital
(Notes 3 and 11.a)

Share premium
(Note 11.b)

Reserves
(Notes 3 and 11.c)

Own shares
(Note 11.d)

Prior
years' losses

Profit/(loss) for
the year (Note 3)

Equity

Total recognised income and expense

Transactions with partners or owners

Capital increases

Capital reductions

Distribution of dividends

Transactions with shares or equity interests (net)

Other changes in net equity

13,171

14,871

(1,700)

(41,955)

(14,962)

(16,210)

(10,783)

274,497

(590)

17,910

(18,500)

45,867

(29,374)

(91)

–

(10,783)

(18,500)

(274,497)

Equity at 31 December 2022

438,345

1,673,477

2,619,098

(27,264)

(2,392,774)

45,867

2,356,749

Total recognised income and expense

Transactions with partners or owners

Capital increases

Capital reductions

Distribution of dividends

Transactions with shares or equity interests (net)

Other changes in net equity

(2,238)

22,698

(24,936)

(316,742)

(22,810)

(274,480)

(19,452)

45,867

26,854

298,588

(271,734)

1,142,752

(292,126)

(112)

(828)

(19,452)

(271,734)

(45,867)

Equity at 31 December 2023

436,107

1,673,477

2,348,223

(410)

(2,392,774)

1,142,752

3,207,375

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the financial statements for the 2023 business year. In particular, note 11 "Net equity" contains further details on this statement.

Fomento de Construcciones y Contratas, S.A. | Cash flow statement for the business | Page 1 of 2

Cash flow statement for the business
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

469

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report 31/12/2023 31/12/2022Profit for the year before tax 1,156,596 (59,172) Adjustments to profit/(loss) (1,139,476) 76,921 Depreciation and amortisation (Notes 5 and 6)5,585 5,891 Impairment loss allowances (Note 9)(263,225) 67,954 Changes in provisions (Note 12)(3,026) (5,508) Profit/(loss) from de-recognitions and non-current asset disposals – (123) Gains from cancellations and disposal of financial instruments (Note 9.a)(888,279) 69 Financial income (Note 18)(37,489) (30,709) Financial expenses47,485 38,218 Exchange differences(91) 3,571 Change in fair value of financial instruments(436) (2,442) Changes in working capital 8,428 6,494 Trade and other receivables19,600 (9,075) Trade and other payables(11,225) 15,542 Miscellaneous current assets and liabilities53 27 Other cash flows from operating activities (7,444) 31,702 Interest paid(48,324) (37,742) Interest and dividend collections11,523 19,004 Corporation tax refunded/(paid) (Note 16.h)29,357 50,440 TOTAL CASH FLOWS FROM OPERATING ACTIVITIES 18,104 55,945 Fomento de Construcciones y Contratas, S.A. | Cash flow statement for the business | Page 2 of 2

Cash flow statement for the business

FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023 (in thousands of euros)

470

Notes 1 to 22 and the attached annexes I to III form an integral part of the financial statements and, together with these, make up the annual accounts for 2023.

FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report 31/12/2023 31/12/2022Payments on investments (377,672) (138,324) Group companies and associates (Note 9)(375,165) (133,709) Intangible fixed and non-current asset, property, plant and equipment and other assets (Notes 5 and 6)(2,507) (4,615) Proceeds from divestments 1,055,972 136,008 Group companies and associates (Note 9)1,053,522 134,054 Intangible fixed and non-current asset, property, plant and equipment and other assets (Notes 5, 6 and 18)2,450 1,954 TOTAL CASH FLOWS FROM INVESTING ACTIVITIES 678,300 (2,316) Proceeds and (payments) from equity instruments (Note 11) (272,676) (18,589) Proceeds from (payments on) financial liabilities (Note 13) (247,625) (73,697) Issuance of: Debt instruments and other marketable securities226,030 279,000 Bank borrowings – 154,564 Payables to Group companies and associates32,224 18,264 Repayment and amortisation of: Debt instruments and other marketable securities(249,230) (285,800) Bank borrowings(154,564) (200,000) Payables to Group companies and associates(102,056) (39,725) Other payables(29) – Dividend payments (Note 11) (19,452) (10,783) TOTAL CASH FLOWS FROM FINANCING ACTIVITIES (539,753) (103,069) Effect of changes in exchange rates (707) (1,737) NET INCREASE/(DECREASE) IN CASH OR CASH EQUIVALENTS 155,944 (51,177) Cash and cash equivalents at the start of the period 10,583 61,760 Cash and cash equivalents at the end of the period 166,527 10,583 471

Notes to the financial statements
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 december 2023

1. Company activity

2. Basis of presentation of the financial statements

3. Distribution of profit

4. Recognition and measurement standards

Intangible assets

6. Property, plant and equipment

7. Leases

8. Current and non-current financial assets

Investments and payables to Group companies and associates

10. Cash and cash equivalents

11. Equity

12. Long-term provisions

13. Non-current and current payables

14. Trade payables

472

473

474

479

480

481

482

483

487

490

492

15. Information on the nature and level of risk of financial instruments

16. Deferred taxes and tax matters

17. Third party guarantees and other contingent liabilities

18. Revenue and expenses

19. Transactions and balances with related parties

20. Environmental information

21. Other information

22. Events after the reporting period

Annex I: Group companies

Annex II: Joint ventures

Annex III: Associates and jointly controlled companies

493

497

501

502

503

509

510

511

513

514

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 1 of 44FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability Report
Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 2 of 44

472

1. Company activity

Fomento de Construcciones y Contratas, S.A. is the parent company of the FCC Group, which comprises a
wide range of both Spanish and foreign subsidiaries and associates.

• Cement. Operation of quarries and mineral sites, the manufacturing of cement, limestone, plaster and

derivate pre-manufactured products and the production of concrete.

• Concessions. Mainly includes concession agreements related to the operation of motorways, tunnels

and other similar infrastructures and urban tramways.

Company identification data

Name of the reporting entity or other means of
identification

Fomento de Construcciones y Contratas, S.A.

2. Basis of presentation of the financial statements

Legal form of the entity

Public Limited Company (In Spain: Sociedad Anónima)

Address of the entity's registered office

C. Balmes 36, 08007 Barcelona, Spain

The financial statements have been drawn up from the accounting records of Fomento de Construcciones
y Contratas, S.A. and the temporary joint ventures in which it participates, so they present fairly the equity,
the financial position, the results of the Company and the cash flows for the year.

Address of the entity

Country of incorporation

Main place of business

Avenida Camino de Santiago 40, 28050, Madrid, Spain

Spain

The regulatory framework applicable to the Company is established in:

• The Spanish Commercial Code and other commercial legislation.

Name of the parent company

Control Empresarial de Capitales, S.A. de C.V.

• General Accounting Plan and its sector adaptations.

Name of the controlling parent of the Group

Control Empresarial de Capitales, S.A. de C.V.

• The mandatory rules approved by the Spanish Institute of Accounting and Auditing in order to

Changes in the name of the reporting entity

No changes have occurred this year

implement the General Accounting Plan and its supplementary rules.

FCC The Group operates in the following business Areas:

• Environmental Services. Services related to urban sanitation, industrial waste treatment, green area

conservation, including both the construction and operation of treatment plants and the energy recovery
of waste.

• Integrated Water Management. Services relating to the integrated water cycle: collection, purification
and distribution of water for human consumption; wastewater collection, filtration and purification;
design, construction, operation and maintenance of water infrastructure for municipal, industrial,
agricultural services, etc.

• All other applicable Spanish accounting legislation.

These financial statements, which have been prepared by the Company's Board of Directors, will be
submitted for approval at the Annual Shareholders' Meeting, and they are expected to be approved without
any modification. For its part, the annual accounts for the 2022 financial year were approved by the
General Shareholders' Meeting held on June 14, 2023.

The financial statements are expressed in thousands of euros.

Joint ventures and similar entities

• Construction. Specialising in infrastructure, building and related sectors: motorways, highways, roads,

tunnels, bridges, hydraulic works, ports, airports, urban developments, housing, non-residential building,
lighting, industrial climate control installations, environmental restoration, etc.

The balance sheets, income statements, statements of changes in equity and cash flow statements of
the joint ventures in which the company participates were incorporated by the proportional consolidation
method, based on the shareholding of each joint venture.

• Real Estate. Dedicated to the promotion of housing and the rental of offices, commercial premises and

residential properties.

The main figures of the consolidated annual accounts of Fomento de Construcciones y Contratas, S.A.
prepared in accordance with International Financial Reporting Standards (EU-IFRS) are the following:

2023

2022

16,717,675

15,282,541

4,450,067

3,387,882

9,026,016

7,705,687

590,988

315,182

Total assets

Equity attributable to the Parent

Revenue

Profit attributable to the Parent

Restatements

No restatements were made in the current financial statements.

3. Distribution of profit/loss

The Board of Directors of Fomento de Construcciones y Contratas, S.A. decided to allocate the remaining
profit for 2023 of 1,142,752 thousand euros to retained earnings; accordingly, it was not proposed to
distribute or apply this profit to any other account.

On the other hand, in fiscal year 2022 the Company had a profit of 45,867 thousand euros, distributed as
follows: 2,634 thousand euros to Legal reserves and 43,233 thousand euros to voluntary reserves. After
the preparation of these financial statement, the Ordinary General Shareholders' Meeting approved the
distribution of a scrip dividend with an impact on voluntary reserves of 42,262 thousand euros (note 11).

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 3 of 44

The joint ventures were included through adjustments to unify the accounting period and the valuation
methods, together with the reconciliations and reclassifications required and the appropriate eliminations,
both of the asset and liability balances and of the reciprocal revenue and expenses. In the notes to the
financial statements, the corresponding amounts are broken down when they are large.

The balance sheet and income statement include the balance sheet aggregates at the shareholding in the
joint ventures shown below:

Revenue

Operating profit

Non-current assets

Current assets

Non-current liabilities

Current liabilities

2023

502

499

2022

138

417

423

The joint ventures and percentage holdings are listed in Appendix II.

Grouping of epigraphs

Certain balance sheet, income statement and cash flow statement epigraphs have been grouped together
so that they may be more easily understood; in any event, all significant information is broken down
separately in the corresponding notes to the financial statements.

Consolidated financial statements

Fomento de Construcciones y Contratas, S.A. is the head of a group of companies forming FCC Group,
so its directors are obliged to prepare separate consolidated financial statements. These consolidated
financial statements were prepared in accordance with International Financial Reporting Standards (IFRS-
EU), as set forth in Regulation (EC) No. 1606/2002 of the European Parliament and of the Council of 19
July 2002 and all enacting provisions and interpretations. The 2023 consolidated financial statements
of the FCC Group, which have been prepared by its directors, will likewise be submitted for approval at
the General Shareholders’ Meeting. For its part, the consolidated financial statements for the year 2022,
prepared on 23 February 2023, were approved by the General Shareholders' Meeting held on 14 June 2023
and deposited in the Mercantile Registry of Barcelona.

4. Recognition and measurement standards

The main recognition and measurement bases used by the company in the preparation of the 2023
financial statements, in accordance with the Spanish General Chart of Accounts, were as follows:

a) Intangible assets

a.1) Acuerdos de concesión

Concession arrangements are recognised pursuant to Order EHA/3362/2010, approving the rules for
adapting the Spanish General Chart of Accounts to public infrastructure concessionary companies.

The Company has assets classified as concession agreements corresponding to assets from contracts
operated jointly through temporary joint ventures, all of which are intangible assets under the intangible
asset model, given that the demand risk is assumed by the concessionary company and this company
does not have an unconditional entitlement to receive anything from the granting authority.

a.2) Other intangible assets

The remaining intangible assets, basically software applications, are recognised at their acquisition or
production cost And, subsequently, at cost less any accumulated amortisation and any accumulated
impairment losses. At year-end, no signs of losses in value were identified in any of the company’s
intangible fixed and non-current assets relating to this heading.

Maintenance costs are recognised in the income statement for the period in which they are incurred.

Generally, intangible assets are amortised over their useful lives on a straight-line basis.

b) Property, plant and equipment

Items of property, plant and equipment are measured initially at acquisition or production cost when the
company has performed in-house work on its non-current assets, and are subsequently carried net of
accumulated depreciation and any impairment losses. Upkeep and maintenance costs relating to property,
plant and equipment are taken to the statement of profit and loss in the business year in which they are
incurred. However, improvement expenses leading to increased capacity or efficiency or to a lengthening
of the useful life of the assets are capitalised.

474

For property, plant and equipment that necessarily takes a period of more than twelve months to get ready
for their intended use, the capitalised costs include such borrowing costs as might have been incurred
before the assets are ready for their intended use and which have been charged by the supplier or relate
to loans or other specific-purpose or general purpose borrowings directly attributable to the acquisition or
manufacturing of the assets.

The company’s in-house work on property, plant and equipment is recorded at the accumulated cost
resulting from external costs, in-house costs determined on the basis of the in-house consumption of
materials, direct labour costs and general manufacturing overheads.

The Company depreciates essentially all of its property, plant and equipment on a straight-line basis, using
annual rates based on the years of estimated useful life of the assets, as follows:

Buildings and other constructions

Technical installations and machinery

Other installations, tools and furniture

Other property, plant and equipment

Years of estimated useful life

25 – 50

5 – 15

8 – 12

4 – 10

c) Impairment of intangible assets and property, plant and equipment

All of the company's intangible assets and property, plant and equipment have a finite useful life and
it therefore performs impairment tests to estimate the possible existence of losses that cause their
recoverable amount to fall below their carrying amount.

Recoverable amount is determined as the greater of fair value less costs to sell and value in use. In order
to calculate the recoverable amount of assets subject to impairment tests, the current value of the net
cash flows originating from the associated cash-generating units (CGUs) is estimated, and a pre-tax
discount rate is used to discount cash flows; this discount rate includes the current market assessments
of the time value of money and the risks specific to each cash-generating unit.

Where an impairment loss on the assets is subsequently reversed, the carrying amount of the asset or
cash-generating unit is increased to the revised estimate of its recoverable amount, up to the limit of
the carrying amount that would have been determined had no impairment loss been recognised in prior
business years. The reversal of an impairment loss is recognised as income in the income statement.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 5 of 44

d) Leases

e) Financial instruments

Leases are classified as finance leases whenever the terms of the lease transfer substantially all of the
risks and rewards incidental to ownership of the leased asset to the lessee. Other leases are classified as
operating leases. All leases contracted by the Company are classified as operating leases.

e.1) Financial assets

When the company acts as lessee, it recognises the expenses from operating leases in profit or loss in the
business year in which they accrue.

Classification

When the company acts as lessor, revenue and expenses from operating leases are recognised in profit or
loss in the year in which they accrue. The acquisition cost of the leased asset is presented in the balance
sheet in accordance with the nature of the asset, increased by the amount of the investments arising from
the directly attributable lease arrangements, which are expensed over the term of these arrangements,
using the same method as applied for recognition of lease income.

Any collection or payment that may arise when an operating lease is concluded is treated as a collection or
prepayment that is allocated to profit or loss over the leasing term as the benefits of the leased asset are
transferred or received.

The financial assets held by the Company are classified in the following categories:

1. Financial assets at amortised cost. In general, the following fall into this category:

• Credits for commercial operations: financial assets originating from the sale of goods and the

provision of services from the company's ordinary business subject to deferred payment.

• Credits for non-commercial operations: financial assets which, not being equity instruments or

derivatives, do not originate from trade operations and whose collections are of a determined or
determinable amount, deriving from loan or credit operations granted by the company.

Financial assets classified in this category are initially measured at their fair value which, unless there is
evidence to the contrary, is assumed to be the transaction price, which is equivalent to the fair value of
the consideration given, plus directly attributable transaction costs.

However, loans for commercial operations maturing in no more than one year and that do not have an
explicit contractual interest rate, as well as loans to personnel, dividends receivable and disbursements
required on equity instruments, the amount of which is expected to be received in the short term, are
measured at their nominal value when the effect of not updating the cash flows is not significant.

For subsequent measurement, the amortised cost method is used. Accrued interest is recorded in the
profit and loss statement (financial income), applying the effective interest rate method.

476

2. Financial assets at fair value through changes in equity: investments in equity instruments are

e.2) Financial liabilities

included, provided that they are not held for trading or should be valued at cost.

The subsequent measurement is at fair value, without deducting the transaction costs that could
be incurred in its sale. Changes that occur in the fair value are recognised directly in equity, until
the financial asset is removed from the balance sheet or is impaired, whereupon the amount thus
recognised is allocated to the profit and loss statement.

3. Financial assets at cost: includes investments in Group, associated and jointly controlled companies.
Group companies are considered to be those over which the company has control, while associated
companies are companies over which the company exercises a significant influence. Jointly controlled
companies include companies over which joint control is exercised with one or more partners through
an agreement.

The investments included in this category are initially measured at cost, which is equal to the fair value

of the consideration given plus the transaction costs that are directly attributable to them.

The subsequent measurement is also at cost less the accumulated amount of the valuation corrections
for impairment. These adjustments are calculated as the difference between their book value and the
recoverable amount, understood as the greater of their fair value minus selling costs and the present
value of the future cash flows resulting from the investment. Unless better evidence of the recoverable
amount is available, the estimated loss for impairment is calculated based on the investee’s equity,
consolidated where appropriate, corrected for any unrealised gains at the measurement date, including
any goodwill.

At least at the end of each reporting period, the company books the related impairment loss allowances
for financial assets that are not carried at fair value when there is objective evidence of impairment if
this value is lower than its carrying amount, in which case, the impairment is recognised in the income
statement. In particular, the company calculates impairment loss allowances for trade and other
receivables by carrying out a case-by-case analysis of the insolvency risk of each receivable.

The Company derecognises financial assets when the rights to the cash flows from the financial asset
expire or have been transferred and substantially all the risks and rewards of ownership have been
transferred.

All financial liabilities held by the Company are classified in the category of financial liabilities at amortised
cost.

Financial liabilities are those payables and accounts payable that the Company has and that have resulted
from the purchase of goods and services as a result of the Company's trade transactions, or those that,
without having a commercial origin, cannot be considered as financial instruments.

Financial liabilities classified in this category are initially measured at their fair value which, unless there is
evidence to the contrary, is assumed to be the transaction price, which is equivalent to the fair value of the
consideration given, adjusted by the transaction costs that are directly attributable.

Accounts payable are initially measured at the fair value of the consideration received. These financial
liabilities are subsequently measured at amortised cost.

Bank borrowings and other current and non-current financial liabilities maturing within no more than
twelve months from the balance sheet date are classified as current liabilities and those maturing within
more than twelve months as non-current liabilities.

The Company derecognises financial liabilities when the obligations giving rise to them are extinguished.

e.3) Equity instruments

An equity instrument represents a residual interest in the company’s equity after deducting all of its
liabilities from its assets, and the securities issued are recognised in equity at the amount received, after
deducting the issue charges, net of taxes.

Own shares acquired by the company during the business year are recognised at the value of the
consideration paid and are deducted directly from equity. Any gains or losses on the purchase, sale,
issue or redemption of own equity instruments are recognised directly in equity and never in the income
statement.

f) Foreign currency transactions

The Company's functional currency is the euro. Consequently, transactions in other currencies are
considered to be denominated in foreign currency and are translated at the exchange rates prevailing on
the transaction date.

At each reporting date, monetary assets and liabilities denominated in foreign currencies are translated to
euros at the closing exchange rate. Profits or losses are directly recorded in the income statement in the
business year in which occur.

g) Corporation tax

The expense for corporation tax is calculated on the basis of profit before tax, increased or decreased, as
appropriate, by the permanent differences between taxable profit and accounting profit. The corresponding
tax rate based on the applicable legislation is applied to this adjusted accounting profit. The tax relief and
tax credits earned in the year are deducted and the positive or negative differences between the estimated
tax charge calculated for the prior year’s accounting close and the subsequent tax settlement at the
payment date are added to or deducted from the resulting tax charge.

The temporary differences between accounting profit and taxable profit for corporation tax purposes,
together with the differences between the carrying amounts of assets and liabilities recognised in the
balance sheet and their tax bases, give rise to deferred taxes that are recognised as non-current assets
and liabilities. These amounts are measured at the tax rates that are expected to apply in the business
years in which they will foreseeably be reversed, without performing financial discounting at any time.

The Company recognises deferred tax assets corresponding to temporary differences, negative tax bases
pending compensation or deductions pending application for which it is likely that the Tax Group will have
future taxable profits that make it possible to recover these assets. To calculate the value of deferred tax
assets, the Directors estimate the amounts and dates on which future taxable profits will be obtained and
the reversal period for temporary differences.

h) Revenue and expenses

Income and expenses are allocated on an accrual basis, i.e. when the actual flow of goods and services
they represent takes place, regardless of when the resulting monetary or financial flow occurs. Revenue is
measured at the fair value of the consideration received, less discounts and tax.

The main income recognised by the Company corresponds to income from subsidiaries, both from the
provision of services and dividends and financial income. As a result of the publication in 2009 by the ICAC

477

of a consultation relating to the accounting recognition of income from holding companies, “Income from
investments in Group companies and associates” and “Finance income from marketable securities and
other financial instruments of Group companies and associates” are recognised under “Revenue” in the
accompanying income statement.

Interest received on financial assets is recognised using the effective interest method, while dividends are
recognised when the shareholder’s right to receive payment has been established. In any case, interest and
dividends on financial assets accrued subsequent to acquisition are recorded as income in the income
statement.

In keeping with the accounting principle of prudence, the company only recognises realised income at
year-end, whereas foreseeable contingencies and losses, including possible losses, are booked as soon as
they become known, through the posting of the appropriate provisions.

i) Cash and cash equivalents

Cash and other liquid equivalent assets include cash on hand and demand deposits with credit institutions.
Other highly liquid short-term investments are also included under this concept as long as they are easily
convertible into cash and are subject to an insignificant risk of changes in value. For these purposes,
investments with maturities of less than three months from the date of acquisition are included.

j) Provisions and contingencies

The company recognises provisions on the liability side of the accompanying balance sheet for present
obligations arising from past events for which the company considers it probable that there will be an
outflow of funds to settle them on maturity.

Provisions are classified as current or non-current in the accompanying balance sheet on the basis of the
estimated maturity date of the obligation covered by them, and non-current provisions are considered
to be those whose estimated maturity date exceeds the average cycle of the activity giving rise to the
provision.

478

Contingent liabilities resulting from possible obligations that might arise from past events, whose
existence will be confirmed only by the occurrence or non-occurrence of one or more future events not
wholly within the control of the company are not recognised in the financial statements, as the probability
that such obligation will have to be met is remote.

Although these estimates were drawn up on the basis of the best information available as at 31 December
2023, future events may require adjustments in coming years, where appropriate to be made in advance.

n) Related party transactions

k) Capital assets of an environmental nature

The company carries out all transactions with related parties at arm’s length.

Environmental assets are assets that are used on a lasting basis in the Company's activities, the main
purpose of which is to minimise environmental impact and to protect and improve the environment,
including the reduction or elimination of future pollution.

The Company, due to its nature and activity, (Note 1) does not have a significant environmental impact.

Note 19 “Related party transactions and balances” to these financial statements details the main
transactions with the company’s significant shareholders, its directors and senior executives, and between
Group companies or entities.

o) Cash flow statement

l) Pension and similar obligations

The Company has not established any pension plans to supplement the social security pension plans.
Under the Consolidated Pension Plans and Pension Funds Law, in those specific cases in which similar
obligations exist, the company outsources its commitments to its employees in this area.

The following terms are used in the statement of cash flows with the meanings specified:

• Cash flows: cash entries and withdrawals and their equivalents.

• Cash flows from operating activities: payments and collections from the company’s principal revenue-

producing activities and other activities that are not classified as investing or financing activities.

Contributions made by the company are recognised under “Staff expenses” in the income statement.

• Cash flows used in investing activities: payments and collections resulting from purchases and

divestments of non-current assets.

• Cash flows from financing activities: payments and collections from the placement and settlement of

financial liabilities, equity instruments and dividends.

m) Use of estimates

In the preparation of these financial statements, estimates were made by the company’s directors to
measure certain of the assets, liabilities, income, expenses and obligations reported herein. These
estimates relate basically to the following:

• The recoverability of deferred tax assets (Notes 4.g and 16).

• The recoverability of investments in Group companies and associates, and loans and receivables with

these, as well as financial assets with third parties (notes 4.e, 8 and 9).

• The measurement of possible impairment losses on certain assets (notes 4.c, 5 and 6).

• The useful life of property, plant and equipment and intangible assets (notes 4.a and 4.b).

• The calculation of certain provisions (notes 4.j and 12).

479

5. Intangible fixed assets

Details of the fixed and non-currents assets and of the related accumulated amortisation as of 31
December 2023 and 2022 are as follows:

Changes in this heading in the accompanying balance sheet in the 2023 and 2022 financial years were as
follows:

Cost

Accumulated
amortisation

Impairment

Net

Concession
agreements

Software

Other
intangible
assets

Accumulated
amortisation

Impairment

Total

53,292

1,126

(46,766)

1,353

563

(2,449)

—

(1,676)

—

7,705

(533)

(1,676)

5,496

54,645

1,139

—

(49,215)

(2,254)

(7)

(1,122)

2023

Concession agreements

Software

Other intangible fixed and non-current
assets

2022

Concession agreements

Software

—

(10)

—

(8)

Other intangible fixed and non-current
assets

55,784

(51,467)

(7)

4,366

Balance at 31.12.21

Receipts or
endowments

Release, removals and
transfers

Balance at 31.12.22

Receipts or
endowments

Release, removals and
transfers

Balance at 31/12/23

—

(28)

55,784

(51,436)

(3)

55,840

(51,467)

(25)

54,645

(49,184)

(6)

54,711

(49,215)

(7)

—

(7)

—

4,348

—

4,366

5,461

5,496

The balance for "Software applications" relates mainly to implementation, development and improvement
costs for the corporate information system, and costs related to information technology infrastructure.

With regard to net intangible assets, only 19 thousand euros (28 thousand euros at 31 December 2022)
relate to assets arising from arrangements operated jointly through joint ventures.

All intangible assets at year-end were used in production processes; however, some such intangible assets,
basically software applications, had been fully amortised, in the amount of 47,815 thousand euros (43,121
thousand euros at 31 December 2022). The amount corresponding to joint ventures was insignificant.

At 31 December 2023, the company did not own any significant intangible assets pledged as security or
purchase commitments of a significant amount.

480

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 10 of 44

6. Property, plant and equipment

Changes in this heading in the accompanying balance sheet in the 2023 and 2022 business years were as follows:

Balance at 31.12.21

Receipts or endowments

Release, removals and transfers

Transfers

Balance at 31.12.22

Receipts or endowments

Release, removals and transfers

Balance at 31.12.23

Land and
buildings

Plant and other items of property,
plant and equipment

Advances and PP&E
under construction

Accumulated
amortisation

Other intangible assets

17,843

—

17,843

—

17,843

35,094

941

(6)

1,529

37,558

437

—

37,995

399

1,130

—

(1,529)

—

(20,286)

(3,269)

—

(23,551)

(3,330)

—

(26,881)

Impairment

(5,088)

—

(5,088)

—

(5,088)

Total

27,962

(1,198)

(2)

—

26,762

(2,809)

—

23,953

The detail of property, plant and equipment and of the related accumulated depreciation at 31 December
2023 and 2022 is as follows:

The company owns buildings, whose value separated from the net depreciation of said buildings and the
value of land, at year-end, was as follows:

2023

Land and buildings

Cost

Accumulated
amortisation

Impairment

Net

17.843

(1.083)

(5.088)

11.672

Land

Buildings

2023

10,500

1,172

11,672

2022

10,500

1,218

11,718

Plant and other items of property, plant and equipment

37,995

(25,798)

Advances and PP&E under construction

—

12,197

55,922

(26,881)

(5,088)

23,953

2022

Land and buildings

17,843

(1,037)

(5,088)

11,718

Plant and other items of property, plant and equipment

37,558

(22,514)

—

15,044

55,401

(23,551)

(5,088)

26,762

At the end of the 2023 and 2022 financial years there are no significant assets from contracts operated
jointly through joint ventures.

In the 2023 and 2022 business years, the company had not capitalised any finance costs under “Property,
plant and equipment”. It did not have any significant commitments to acquire property, plant and
equipment. It also has no assets subject to significant ownership restrictions.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 11 of 44

481

Most of the items of property, plant and equipment, at the closing date, are used in the various production
processes. Part of said property, plant and equipment, however is fully depreciated, amounting to 6,229
thousand euros (3,942 thousand euros at 31 December 2022).

The Company takes out insurance policies to cover the possible risks to which its property, plant and
equipment are subject. At year-end, all items of property, plant and equipment had been fully insured
against these risks.

7. Leases

As explained in Note 4.d, all the leases contracted by the Company are classified as operating leases.

The amount recognised in the 2023 business year for operating lease expenses totalled 10,623 thousand
euros (10,721 thousand euros at 31 December 2022).

Noteworthy among the operating lease arrangements signed by Fomento de Construcciones y Contratas,
S.A., due to their size, were those relating to FCC Group’s corporate headquarters:

• Office building in Las Tablas, Madrid

On 19 November 2010, the owner and the Company signed a lease agreement on this building, with
the rental arrangement beginning, once the building had been completed, on 23 November 2012. This
arrangement has an 18-year term, extendable at the company’s discretion by two periods of five years
each, with annual rent adjusted annually in line with the CPI.

On 21 September 2018, a non-extinguishing modifying Addendum to the original agreement was signed
with the new owner, “Las Tablas 40 Madrid, S.L.U.”. The modified terms and conditions mainly lead to a
5.6% reduction in rent and the possibility of sub-letting to third parties without the consent of the owner,
provided that certain requirements are met.

• Office buildings at Federico Salmón 13, Madrid and Balmes 36, Barcelona

On 29 December 2011, the owners of these buildings and Fomento de Construcciones y Contratas, S.A.
had signed two lease agreements for them, for a minimum committed period of 30 years, extendable,
at the company’s discretion, by two periods of five years each, with initial annual rent adjustable in line
with the CPI. These buildings were transferred by the company to their current owner through a sale and
leaseback arrangement. The owners, in turn, granted a purchase option to Fomento de Construcciones y
Contratas, S.A., which can only be exercised at the end of the lease period, at fair value or at the amount
of the sale adjusted by the CPI, if this is higher.

On 1 June 2016, the company ceded its contractual position to Fedemes, S.L., wholly owned by it, which
signed sub-lease agreements with the FCC Group companies that occupied the buildings, including
Fomento de Construcciones y Contratas, S.A., with the same duration conditions as the original
arrangement as indicated previously.

At year-end, there were non-cancellable future payment commitments amounting to 106,297 thousand
euros (110,552 thousand euros in 2022). Details, by maturity, of the non-cancellable future minimum
payments at 31 December 2023 and 2022 were as follows:

Up to one year

Between one and five years

After five years

2023

10,852

42,449

52,996

2022

10,224

39,921

60,407

106,297

110,552

As the lessor, when it is the holder of the lease arrangements, the company invoices FCC Group investees
based on the use they make of such arrangements, recognising such revenue as operating income.

8. Long-term and short-term financial investments

a) Long-term financial investments

The balance for “Long-term financial investments” at 2023 and 2022 year-end is as follows:

2023

Financial assets at amortised cost

Financial assets at fair value changes
in net worth

2022

Financial assets at amortised cost

Financial assets at fair value changes
in net worth

Equity
instruments

Loans to third
parties

Other financial
assets

Total

—

1,488

—

18,871

—

20,359

1,488

18,871

20,360

1,488

—

18,845

—

20,333

1,488

18,845

20,414

482

The most significant amount recognised was for the 15,088 thousand euros deposit (15,062 thousand
euros at 31 December 2022), in relation to the sale of Global Vía Infraestructuras, S.A., formalised in the
2016 business year, the maturity of which was “2029 and beyond” in view of its indeterminate nature,
since it was tied to the release of the collateral provided by the aforementioned company to third parties
to meet financial commitments. This heading also includes guarantees and deposits for legal or
contractual obligations in the development of the company’s activities.

Financial assets at fair value through changes in equity

The entire amount corresponds to a residual interest in the company Aguas Industriales de Tarragona, S.A.
In fiscal year 2022 it included a 17.80% stake in the company Port Torredembarra, S.A. for a value of 81
thousand euros. This stake was incorporated during financial year 2023 to the wholly-owned subsidiary
FCC Concesiones e Infraestructuras, S.L.U, through a non-monetary contribution to a capital increase of
this company (Note 9.a). The fair value of the business portfolio is worth 516 thousand euros, generating
a profit of 436 thousand euros, as reflected in the heading "Change in fair value of financial instruments"
of the attached profit and loss account, by allocating the adjustments for changes in value to the results
corresponding to this stake.

b) Short-term financial investments

The balance of “Current financial assets” at 2023 and 2022 year-end is as follows:

Financial assets at amortised cost

The detail by maturity of this category of financial assets is as follows:

Financial assets at
amortised cost

2025

2026

2027

2028

2029 and
beyond

Total

—

20,359

2023

Financial assets at amortised cost

Financial assets at fair value changes in the profit and loss account

2022

Financial assets at amortised cost

Financial assets at fair value changes in the profit and loss account

Other financial
assets

1.198

—

1.198

1.203

2.441

3.644

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 13 of 44

The balance of this heading in fiscal year 2023 corresponds to guarantees and deposits for legal or
contractual obligations. During the financial year 2022, it included the amount receivable for an adjustment
in the sale price of FCC Aqualia, S.A. formally arranged in 2018, for 2,441 thousand euros (Note 18). And
the rest corresponded to guarantees and deposits for legal or contractual obligations.

Details of changes in these epigraphs is as follows:

Equity
instruments
of Group
companies

Equity
instruments
of associates

Loans
to Group
companies

Loans to
associates

9. Investments and payables to Group
and associated companies

a) Non-current investments in Group companies and associates

The detail of the non-current investments in Group companies and associates at 31 December 2023 and
2022 is as follows:

Cost

Accumulated
impairment

Total

2023

Balance at 31.12.21

4,059,952

4,744

432,203

Receipts or
endowments

Disposals and
reversals

Transfers

137

—

11,617

(377)

(1,542)

—

Balance at 31.12.22

4,060,089

4,367

444,049

Receipts or
endowments

Disposals and
reversals

107,030

(182,835)

Transfers

45,000

—

22,030

—

(45,000)

Equity instruments in Group companies

4,029,284

(737,472)

3,291,812

Balance at 31/12/23

4,029,284

4,367

421,079

Equity instruments of associates

Loans to Group companies

2022

4,367

421,079

—

4,367

421,079

4,454,730

(737,472)

3,717,258

Equity instruments in Group companies

During 2023, the following changes should be noted:

483

Impairment

Total

(1,022,131) 3,474,792

(193,277)

(181,522)

125,168

123,249

—

(1,090,240) 3,418,265

(1,316)

127,745

354,083

171,248

—

(737,472)

3,717,258

—

1,771

(25)

—

1,746

Equity instruments in Group companies

4,060,089

(1,061,600)

2,998,489

Equity instruments of associates

Loans to Group companies

4,367

—

4,367

444,049

(28,640)

415,409

4,508,505

(1,090,240)

3,418,265

• Sale of a 24.99% stake in FCC Servicios Medioambientales Holding, S.A., worth 75,211 thousands of
euros, to the CPP Investments fund for 965,000 thousand euros, generating a profit, net of expenses
inherent to the operation, of 888,279 thousands of euros (Notes 13 and 15.d)

• Operations related to FCC Concesiones e Infraestructuras, S.L.U. derived from the reorganization of

concessional interests in the FCC Group.

– Acquisition of the stake held by FCC Construcción, S.A. worth 89,789 thousands of euros and

originating from the subsequent capital increases in 2023 by FCC Concesiones de Infraestructuras,
S.L.U. in which FCC Construcción, S.A. has contributed its own concession assets.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 14 of 44

484

– Contribution from the company FCC Versia, S.A.U. to the capital increase of FCC Concesiones e

Infraestructuras, S.L.U. The value of the portfolio was 12,972 thousands of euros and has resulted
in the divestment in FCC Versia, S.A.U. and in return, the acknowledgement of an investment in FCC
Concesiones e Infraestructuras, S.L.U. for this amount. Additionally, and prior to the aforementioned
contribution, several operations have taken place at FCC Versia, S.A.U.

- Capitalisation of the equity loan granted to this Company for 45,000 thousands of euros, with a

total impairment of 28,640 thousands of euros.

- Distribution of a dividend of 5,116 thousand euros and considered as a return of contributions.

- Write-off of the entire portfolio with a net worth of 12,972 thousands of euros (gross investment

Equity instruments of associates

There have been no movements in this heading during the 2023 financial year.

In 2022, Sigenera, S.L. (50% holding) was removed after it was wound up with a net investment value of
259 thousand euros (gross value of 377 thousand euros with accumulated impairment of 118 thousand
euros), generating losses of 69 thousand euros, reflected in "Impairment and gains on disposal of equity
instruments".

Long-term loans to Group companies

102,508 thousands of euros and accumulated impairment of 89,536 thousands of euros).

The most significant balances were as follows:

– •Capital increase with monetary contribution of 3,672 thousand euros.

– Capital increase through non-monetary contribution of the 17.80% stake in the company Port

Torredembarra, S.A. for 516 thousand euros (note 8.a).

FCC Servicios Medio Ambiente Holding, S.A.

• Acquisition of stakes in Cementos Portland Valderrivas, S.A. from third parties for an amount of 81

FCC Concessions and Infrastructure, S.LU.

thousands of euros.

• Incorporation of the company FCC LDF Limited in the United Kingdom, with a capital stock of 50
thousand pounds sterling (58 thousand euros), fully subscribed by Fomento de Construcciones y
Contratas, S.A. and pending to be paid in.

It is worth noting that in 2022, shares were acquired in Cementos Portland Valderrivas, S.A. from third
parties for the value of 137 thousand euros.

The details, by company, of the “Investments in Group companies and associates” headings for 2023 and
2022 are presented in Annexes I and III, respectively, indicating the following details for each company
in which direct ownership interests are held: name, registered office, activity, share of capital directly or
indirectly owned, amount of equity (capital, reserves and others), profit or loss, dividends received, together
with its carrying amount.

Furthermore, as at 31 December 2023 and 2022, none of the companies in which Fomento de
Construcciones y Contratas, S.A. has a direct holding is listed on the stock market.

FCC Construcción, S.A.

FCC Medio Ambiente, S.A.

FCC Versia, S.A.U.

Rest

GROSS TOTAL

Impairment:

FCC Versia, S.A.U.

NET TOTAL

2023

379,731

31,548

8,565

1,173

—

2022

370,515

28,473

—

45,000

421,079

444,049

—

421,079

(28,640)

415,409

The following are noteworthy with regard to the balance at 31 December 2023:

• Subordinated loans granted to FCC Servicios Medio Ambiente Holding, S.A. for a total of 345,203

thousand euros, with a final maturity date on 2034, without partial repayments and at a fixed interest
rate of 2.5% per year that will be capitalised. Any amount, whether interest or principal, to be collected by
the lender will be subordinated to the full repayment of the bonds issued by the borrower. At year-end,
the final balance, including capitalised interest, was 379,731 thousand euros. The interest accrued in the
current year amounts to 9,216 thousand euros (9,082 thousand euros at 31 December 2022).

485

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 15 of 44

• Loan granted to FCC Concesiones de Infraestructuras, S.L.U. for an amount of 20,568 thousand pounds
sterling (23,667 thousand euros at the closing exchange rate), to help a subsidiary within the framework
of the concession for the construction, financing, operation and maintenance of the A-465 road in Wales
(UK). The concession has two phases: (i) Construction from 29 October 2020 to 31 October 2025 and (ii)
Operation from 1 November 2025 to 30 September 2055. The repayment of the aforementioned loan will
begin at the beginning of the second phase provided there is a cash surplus and all accrued interest has
been paid and, in any case, at the end of the operation phase. The aforementioned loan accrues interest
(3.419% and 12% in the first and second phases, respectively). Interest accrued is not capitalised and
will be paid once the second phase begins. As of December 31, 2023, the aforementioned interest
amounts to 7,880 thousand euros, of which 2,489 thousand euros have been generated in the current
year (2,534 thousand euros as of December 31, 2022).

The most significant movement in 2023 was the cancellation of the equity loan granted to FCC
Versia, S.A.U. for 45,000 thousand euros, with an accumulated impairment of 28,640 thousand euros,
which has been capitalised within the process of contribution of this company to FCC Concesiones
e Infraestructuras, S.L., for which a note has been included in this Report, in the heading of "Equity
instruments of Group companies".

Impairment

The following significant changes occurred in the 2023 financial year:

• Reversal of the impairment associated with the stake in Cementos Portland Valderrivas, S.A. worth
81,800 thousands of euros, mainly due to the improvement of the ordinary results of its activity. An
impairment of 192,666 thousands of euros was recorded in 2022, mainly due to the drop in net worth
caused by the impairment of Uniland's goodwill.

• Reversal of the impairment of the investment in FCC Construcción, S.A. for the sum of 181,019

thousand euros, mainly on account of the improvement in the ordinary results of its activity. In 2022,
there was a reversal for a sum of 116,105 thousand euros for the same reason.

• Reversal of the impairment of the stake in FCC Versia, S.A.U. for the entirety (89,536 thousand euros) as
a consequence of the process of contribution of this company to FCC Concesiones e Infraestructuras,
S.L. and commented on in this same note of the Report within the heading of "Equity instruments of
Group companies".

b) Current investments in Group companies and associates

This section includes mainly the loans and other non-trade credits granted to Group companies and
associates, among others, in line with certain specific cash situations, as well as other temporary financial
assets, measured at the lower of cost or market value, increased by interest earned at a market rate. It
also includes the balances generated by tax effects with the subsidiary companies in the tax consolidation
Group, as well as outstanding dividends.

The most significant balances in this regard were as follows:

FCyC, S.A.

Realia Business, S.A.

FCC Servicios Medio Ambiente Holding, S.A.

FCC Environmental Services Florida, LLC

Cementos Portland Valderrivas, S.A.

FCC Aqualia, S.A.

Rest

2023

227,481

99,894

25,237

17,519

12,558

12,485

14,297

409,471

2022

119,267

70,080

2,921

—

7,184

199,452

During 2023, it is worth highlighting the loan granted to FCyC, S.A. for an amount of 178,804 million,
with annual maturity and interest rate referenced to Euribor plus a spread, with the possibility of partial
repayment, mainly aimed at purchasing the 12.19% stake in Realia and 5.934% stake in Metrovacesa,
which directly or indirectly control Control Empresarial de Capitales, S.A, de C.V. With regard to the loan
granted to this company in 2022 for a total amount of 126,500 thousands of euros, it should be noted
that, at the end of financial year 2023, the outstanding balance of this loan is 39,933 thousands of euros
(118,208 thousands of euros as of 31 December 2022). This loan has an annual maturity and interest rate
tied to Euribor plus a spread, with the possibility of partial repayments. The interest accrued for these loans
during this year was 3,843 thousands of euros (1,530 thousands of euros as of 31 December 2022).

Also during 2023, an additional loan was granted to Realia Business, S.A. for an amount of 40,000
thousands of euros, of which 34,000 thousands of euros have been drawn at year end, with annual
maturity and an interest rate referenced to Euribor plus a spread, with optional partial repayments.
Regarding the loan granted to this company in 2021 for a total amount of 120,000 thousands of euros,
it should be noted that, at the end of financial year 2023, the outstanding balance of this loan is 65,000
thousands of euros (70,000 thousands of euros as of 31 December 2022). On December 21, 2023, an
addendum to the main contract has been signed, by which the original contract is extended for one year
under the same conditions as the main contract. The interest accrued on the aforementioned loans in the
current year amounts to 3,759 thousand euros (1,124 thousand euros as of December 31, 2022).

In addition, the increase in the balance with FCC Aqualia, S.A. is due to the distribution of the dividends,
which were pending to be paid as of 31 December 2023.

c) Non-current payables to Group companies and associates

The balance at 31 December 2023 (same as at 31 December 2022) corresponds in its entirety to the loan
that FCC Aqualia, S.A. has granted to the Company, in accordance with the following conditions:

• Loan amount: 806,479 thousand euros

• Maturity: 28 September 2048.

• Interest periods: annual periods, except the final period which will end on 28 September 2048.

• Interest rate: 3.55%.

• Payment of annual interest when the borrower and its subsidiary companies, excluding the FCC Aqualia

subgroup, hold “available cash” at 30 September which is not less than the amount of the accrued
interest. Any unpaid matured interest will be capitalised and accrue interest, as regulated in article 317
of the Code of Commerce.

• Collateral: the guarantees mentioned in note 16 continued to be granted.

The aforementioned loan has accrued interest of 29,028 thousand euros in the business year (same
amount as at 31 December 2022).

486

d) Current payables to Group companies and associates

Payables to Group and associated companies include loans received by the Company which are
remunerated at market prices, as well as the balances generated by the tax effect with the subsidiary
companies of the tax consolidation Group. The most significant balances on the liabilities side of the
accompanying balance sheet are as follows:

Asesoría Financiera y de Gestión, S.A.U.

FCC Construcción, S.A.

Fedemes, S.L.U.

FCC Environmental Services Florida, LLC

FCC Environmental Services Texas, LLC

Cementos Portland Valderrivas, S.A.

FCyC, S.A.

Rest

2023

235,781

46,534

22,605

15,184

11,783

6,495

4,548

19,720

2022

300,570

30,122

22,108

2,803

5,708

11,370

25,697

14,680

362,650

413,058

The most significant amount in both years was the amount corresponding to Asesoría Financiera y
de Gestión, S.A. for the sum of 235,781 thousand euros (300,570 thousand euros as at 31 December
2022). In 2015, cash pooling contracts were signed between the aforementioned company and FCC
Group companies, including the Parent Fomento de Construcciones y Contratas, S.A., whereby financial
movements are channelled through said subsidiary.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 17 of 44

10. Cash and cash equivalents

The composition of this heading as of December 31 is as follows:

Cash

Demand current accounts

NET TOTAL

2023

166,493

166,527

2022

10,529

10,583

Current accounts earn the usual market interest rate for this type of account.

Almost all of the amounts in this heading have no availability restrictions.

11. Net equity

The Ordinary General Shareholders' Meeting held on 14 June 2023 adopted resolutions including but not
limited to the following:

1. Reduction of share capital through the redemption of treasury stock

Reduction of the share capital of Fomento de Construcciones y Contratas, S.A. for a maximum nominal
amount of 3,725,383.00 euros, through the cancellation of up to 3,725,383 own shares with a nominal
value of one euro each.

487

2. Distribution of a scrip dividend

Implemented through the issuance of new common shares with a nominal value of 1 euro each, with no
issue premium, of the same class and series as those in circulation, charged to reserves. This resolution
also included an offer by the company to acquire the free allocation rights at a guaranteed price.

At its meeting on 28 June 2023, following the General Shareholders' Meeting, the Board of Directors
resolved to execute the scrip dividend distribution resolution adopted by the Shareholders' Meeting, the
most significant characteristics of which are described below:

• Maximum value of the scrip dividend: 219,172,491.50 euros, equivalent to 0.50 euros per share.

• Shareholders received the corresponding allocation rights and could choose between three options:
receiving the new shares released, transferring their rights in the market or selling their rights to the
company for the guaranteed price of 0.50 euros per share.

• The number of free allotment rights required to receive a new share was set at 19. Shareholders who

chose this option also received a compensatory cash dividend of 0.78 euros for each new bonus share
received, to make this financially equivalent to transferring their rights to the company.

• At the end of the trading period of the free-of-charge allocation rights on 17 July 2023, holders of

431,257,401 (99.18%) rights opted to receive new shares, while shareholders holding 3,566,498 rights
opted to accept the Company's offer to acquire their rights at a guaranteed price. Accordingly, the final
number of 1 euro bonus shares issued was 22,697,739 shares, corresponding to 5.22% of the capital
stock prior to the increase, resulting in a cash outflow for the compensatory dividend, as well as for the
rights acquired by the Company of 19,452 thousand euros.

• On 25 July 2023, the public deed to increase the Company's paid-up capital with a charge to voluntary

reserves was registered at the Barcelona Mercantile Registry.

In addition, at the Ordinary General Shareholders' Meeting held on 14 June 2022, a decision was taken to
distribute a scrip dividend, with the following characteristics:

• Maximum value of the scrip dividend: 170,069,454.40 euros, equivalent to 0.40 euros per share.

• The number of free allotment rights required to receive a new share was set at 28. Shareholders who

chose this option also received a compensatory cash dividend of 0.493 euros for each new bonus share
received, to make this financially equivalent to transferring their rights to the company.

• At the end of the trading period for the free allocation rights, on 4 July 2022, holders of 416,397,716
(97.94%) rights had chosen to receive new shares, while shareholders holding 8,775,898 rights had
opted to accept the Company's offer to acquire their rights at the guaranteed price. Accordingly, the final
number of bonus shares with a par value of 1 euro issued was 14,871,347 shares, corresponding to
3.50% of capital stock prior to the increase, resulting in a cash outflow for the compensatory dividend,
as well as for the rights acquired by the Company of 10,783 thousand euros.

The following table shows the effect of distribution of the scrip dividend on the equity of Fomento de
Construcciones y Contratas, S.A., in both financial years:

Capital stock increase

Share capital

Capital stock increase

Costs, net of tax

Acquisition rights at guaranteed price

Compensatory dividend

Voluntary reserves

Change in equity

2023

22,698

(22,698)

(112)

(1,783)

(17,669)

(42,262)

(19,564)

2022

14,871

(14,871)

(91)

(3,510)

(7,273)

(25,745)

(10,874)

Furthermore, the Extraordinary General Shareholders' Meeting held on 19 July 2023 adopted resolutions
including but not limited to the following:

1. Reduction of share capital through the redemption of treasury stock

Reduction of the share capital by a nominal amount of 854,234.00 euros through the redemption of a
maximum of 854,234 treasury shares with a nominal value of one euro.

The Board of Directors, at its meeting on 19 July 2023 after the Extraordinary General Shareholders'
Meeting, decided to proceed with the agreement for the distribution of the reduction of share capital
through the redemption of treasury stock for the nominal amount established of 854,234 shares, bringing
the share capital to 456,667,071 shares with a nominal value of one euro. On 25 July 2023, the public deed
for the aforementioned reduction in capital was registered in the Mercantile Registry of Barcelona.

488

2. Reduction of share capital through the redemption of treasury stock acquired

within the framework of a public takeover bid

Reduction in share capital through the acquisition of treasury stock for subsequent amortisation through a
takeover bid formulated by the Company and addressed to its shareholders for a maximum of 32,067,600
treasury shares, with a nominal value of one euro each, representing 7.01% of the company's share capital,
at a price of 12.50 euros per share.

The Board of Directors, at its meeting on 19 July 2023 after the Extraordinary General Shareholders'
Meeting, decided to proceed with the agreement for the distribution of the reduction of share capital
through the redemption of treasury stock for the nominal maximum amount of 32,027,600.00 euros, under
the terms agreed at the Extraordinary General Shareholders' Meeting. Specifically, the Board of Directors
determined that the formulation of the takeover bid would be made after the end of the opposition period
of the creditors of the capital reduction, which ended on 21 August 2023, without any of the Company's
creditors having opposed this reduction.

On 25 October 2023, the National Securities Market Commission (CNMV) authorised the takeover bid.
The acceptance period was extended from 30 October 2023 to 30 November 2023, both inclusive.

On 6 December 2023, the result of the takeover bid was announced, accepted by 20,560,154 shares,
accounting for 64.20% of the shares to which the bid was aimed and 4.50% of the share capital in the
Company. The disbursement made amounted to 257,002 thousand euros. On December 19, 2023, the
public deed of the aforementioned capital reduction was registered in the Barcelona Mercantile Registry.

With regard to the financial year 2022, it was agreed to reduce the share capital of Fomento de
Construcciones y Contratas, S.A. for a maximum nominal amount of 1,700,000.00 euros at the Ordinary
General Shareholders' Meeting held on 14 June 2022, through the repayment of up to 1,700,000 own
shares with a nominal value of one euro each.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 19 of 44

The capital reduction for the sum of 1,700 thousand euros meant a decrease in the balance of treasury
stock in the amount of 17,910 thousand euros, taking the difference for the sum of 16,210 thousand euros
to voluntary reserves as well as making the mandatory provision of a restricted reserve for amortised
capital for the sum of 1,700 thousand euros, equal to the nominal value of the amortised shares, charged
to voluntary reserves.

a) Capital

The capital of Fomento de Construcciones y Contratas, S,A. at 31 December 2023 comprises 436,106,917
ordinary shares represented through book entries with a par value of 1 euro each.

All shares are fully subscribed and paid and carry the same rights.

In relation to the part of the capital held by other companies, directly or through their subsidiaries, when
it exceeds 10%, according to the information provided, the company Control Empresarial de Capitales,
S.A. de C.V., controlled by the Slim family, holds directly and indirectly, at the date of preparation of these
accounts, 69.58%. Furthermore, Finver Inversiones 2020, S.L.U., 100% owned by Inmobiliaria AEG, S.A.
de C.V., which in turn is controlled by Carlos Slim Helú, has a 11.91% holding. Finally, the company Nueva
Samede Inversiones 2016, S.L.U. has a direct holding of 3.18% of the capital. Esther Koplowitz Romero de
Juseu also holds 151,102 direct shares in Fomento de Construcciones y Contratas, S.A.

b) Share premium

The Spanish Limited Liability Companies Law, as amended, expressly permits the use of the share
premium account balance to increase capital and does not establish any specific restrictions as to its use
for other purposes.

c) Reserves

The breakdown for this heading for the 2023 and 2022 financial years is as follows:

Legal reserve

Other reserves

2023

87,669

2,260,554

2,348,223

2022

85,035

2,534,063

2,619,098

In accordance with the Spanish Corporate Enterprises Act, as amended, 10% of the net profit for each
financial year must be transferred to the legal reserve until the balance of this reserve reaches at least
20% of the share capital. The legal reserve cannot be distributed to shareholders except in the event of
liquidation.

The legal reserve may be used to increase capital provided that the remaining reserve balance is greater
than 10% of the increased capital.

Otherwise, until it exceeds 20% of capital stock and provided there are no sufficient available reserves, the
legal reserve may only be used to offset losses.

As of December 31, 2023, the legal reserve is fully covered.

Noteworthy under “Other reserves” were restricted reserves amounting to 12,110 thousand euros,
equivalent to the nominal value of the own shares redeemed which, pursuant to article 335.c of the
Spanish Limited Liability Companies Law, is restricted, except with the same requirements as for the
capital reduction.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 20 of 44

490

d) Own shares

Movements in the “Own shares” heading in the 2023 and 2022 financial years were as follows:

12. Long-term provisions

The changes in the financial year were as follows:

Balance at 31 December 2021

Sales

Accumulated

Acquisitions

Balance at 31 December 2022

Sales

Accumulated

Acquisitions

Balance at 31 December 2023

(26,674)

—

17,910

(18,500)

(27,264)

—

298,588

(271,734)

(410)

Details of own shares at 31 December 2023 and 2022 were as follows:

2023

2022

Number of shares

44,957

Amount

(410)

Number of shares

2,741,524

Amount

(27,264)

At 31 December 2023, the company’s treasury shares represented 0.01% of the capital stock (0.63% at 31
December 2022).

Liabilities and
contingencies

Contractual and
legal guarantees
and obligations

Self-insurance
reserve

Balance at 31.12.21

Provisions

Applications/reversals

Balance at 31.12.22

Provisions

Applications/reversals

Transfers

Balance at 31/12/23

97,123

—

(19,789)

77,334

3,594

(3,868)

—

77,060

21,716

—

(2,493)

19,223

—

19,223

19,158

118

(4,937)

14,339

(87)

9,738

24,088

Total

137,997

118

(27,219)

110,896

3,692

(3,955)

9,738

120,371

Provision for liabilities and contingencies

This item includes the risks arising for the company in the performance of its activities that are not
included in other categories. These include the risks arising from international expansion, as well as tax
risks. As regards the movements in 2022, the application of 18,726 thousand euros is worth particular
mention, related to the completion of the Corporation Tax audit actions to which the Tax Group headed by
Fomento de Construcciones y Contratas, S.A. had been subject, starting the previous years (Note 16.f).

Provisions for guarantees and contractual and legal obligations

This heading includes the provisions to cover the expenses arising from contractual and legal obligations
of a non-environmental nature. Practically the entire balance corresponds to the financial commitments
granted to the buyers of the company Globalvia Infraestructuras, S.A., formalized in fiscal year 2016
(note 8.a).

491

Self-insurance reserves

This heading includes provisions to cover actions as the insurer itself. During the audit conducted in
financial year 2023 by the General Audit Office of the Social Security regarding how self-insurance
arrangements were being managed in previous years, it is suggested that the self-insurance reserve
of all the companies of the FCC Group with this arrangement be registered in the parent company.
Therefore, at the end of this financial year, the wholly-owned subsidiaries FCC Construcción, S.A. and FCC
Medio Ambiente, S.A. have transferred the entire balance of the aforementioned reserve to Fomento de
Construcciones y Contratas, S.A. for a total amount of 9,738 million euros, which appear in the "transfer"
item of the table shown below.

Other information

In relation to the winding up of the Alpine Group, 2023 saw no significant changes in terms of the amount
reported in the Group's 2022 Financial Statements.

In 2006, the FCC Group acquired an absolute majority in Alpine Holding GmbH, hereinafter AH, and thereby,
indirectly in its operating subsidiary company, Alpine Bau GmbH, hereinafter AB. Seven years later, on 19
June 2013, AB filed for insolvency before the Commercial Court of Vienna, but after the unfeasibility of
the reorganisation proposal was established, the insolvency administrator filed for, and the court decreed,
the bankruptcy, closure and liquidation of the company. On 25 June 2013, the liquidation of the company
was commenced. As a consequence of the bankruptcy of AB, its parent company, AH filed for bankruptcy
before the Commercial Court on 2 July 2013, which declared the bankruptcy and liquidation of AH.

As a result of both bankruptcies, FCC Construcción, S.A. loses control over the Alpine Group, interrupting
its consolidation.

On the reporting date, the administrators recognised liabilities of approximately EUR 1,669 million
in AB and EUR 550 million in AH as part of the corresponding receivership proceedings. The share
of the bankrupt estate in AB currently amounts to 15% whereas for AH's bankruptcy, the bankruptcy
administrator has not been able to estimate and determine the share.

Ten years after the bankruptcy of both companies and having definitively filed the criminal proceedings,
won proceedings brought by bondholders and settled a retroactive action, two proceedings brought by the
insolvency administrators against Fomento de Construcciones y Contratas, S.A. and FCC Construccion
S.A. are still pending, in addition to other proceedings against auditors, former directors, and intermediary
banks in the acquisition of bonds issued by AH in 2010, 2011 and 2012, admitted to trading on the
Luxembourg and Vienna stock exchanges for a joint nominal value of 290 million euros.

Between the bankruptcy of AH and AB and the date on which these financial statements were issued, a
number of proceedings were instigated against the Group and directors of AH and AB. At 31 December
2022, and as far as FCC could be directly or indirectly affected, two commercial proceedings and one
labour proceeding are still in progress:

• In April 2015, the bankruptcy administrator of Alpine Holding GmbH filed a claim for 186 million euros
against FCC Construcción, S.A. and other ex-executive of AB, considering that these parties should
compensate Alpine Holding GmbH for the amounts collected through two bond issues in 2011 and
2012 that were allegedly provided by this company for its subsidiary, Alpine Bau GmbH, without the
necessary guarantees and complying with a “mandate-order” from FCC Construcción S.A. On 31 July
2018, the ruling dismissing the claim was handed down and the claimant ordered to pay the costs.
Having filed appeals and cassation appeals for procedural infringement, in April 2020, the Austrian
Supreme Court declared the need to return the Orders to the Court of Instance so that the testimonial
evidence could be practiced in person before the Judge of First Instance. Such testimonial statements
took place in June 2021 and, in light of the mandate contained in the Supreme Court Judgment, the
judge has yet to decide whether to consider the procedure closed or whether to agree to the practice
of the expert evidence requested by the bankruptcy trustee AH. On 7 June 2023, the judge ruled that he
was ready to pass sentence.

• In April 2017, a Group company, Asesoría Financiera y de Gestión S.A. was notified of a suit in which
an AB bankruptcy administrator made a joint and several claim against the former finance director
of Alpine Bau GmbH and against Asesoría Financiera y de Gestión S.A. for the payment of 19 million
euros for the alleged violation of corporate and bankruptcy law, considering that Alpine Bau GmbH, on
making a deposit at Asesoría Financiera y de Gestión S.A., allegedly made payments charged against
equity, considered to be a capital refund, and therefore prohibited by law. The proceedings are still at
the evidentiary phase, the court expert having issued his report according to which the deposit and the
factoring transactions between subsidiary companies of AB and Asesoría Financiera y de Gestión S.A.
would not have caused any loss to AB. Given the multiplicity of allegations made by the bankruptcy
administrator, the judge is weighing the request for a complementary expert report. On November 16,
2023, a hearing was held in which the judicial expert was questioned about various questions posed to
his report through various writings presented by the parties. The same day, the judge declared that no
further instruments or proposed evidence would be admitted and that he would adopt a decision to be
communicated in writing.

492

• Also in April 2017, a former FCC employee and former executive at AH and AB was notified of a claim

filed by the insolvency administrator of Alpine Bau GmbH in the Social Claims Court for 72 million euros.
The claimant argues that this amount represents the damage to the bankruptcy estate caused by the
alleged delay in initiating insolvency proceedings. In the event that the insolvency administrator's claim
succeeds, with a firm ruling on an indemnity duty, the FCC Group's subsidiary liability could arise in a
remote case.

In terms of these disputes, the FCC Group and its legal advisors do not consider it very probable there will
be any future outflows of cash prior to the issuance of these financial statements; therefore, no provisions
have been set aside, as the Group believes that they represent contingent liabilities.

13. Long and short term debt

All the financial liabilities reflected in the table above are classified within the category of financial liabilities
at amortised cost.

a) Bonds and other current marketable securities

Fomento de Construcciones y Contratas, S.A has had a promissory note programme, Euro Commercial
Paper Programme (ECP), registered since November 2018 on the Irish stock exchange (Euronext Dublin)
for a maximum amount of 600 million euros as at December 2023, at a fixed interest rate and with a
maximum maturity of one year, which allows issuance with maturities of between 1 and 364 days from the
date of issue, in order to meet general financial needs.

As of 31 December 2023, there were no promissory notes pending to be issued (23,200 thousands of
euros as of 31 December 2022).

The balance of “Non-current payables” and “Current payables” was as follows:

b) Current bank borrowings

Long-term

Short-term

On 21 November 2023, the loan worth 150,000 thousands of euros was settled, i.e., the company had no
debt with credit institutions as of 31 December 2023.

2023

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

2022

Debt instruments and other marketable securities

Bank borrowings

Other financial liabilities

—

23,200

155,837

1,080

180,117

As a result of the sale of 24.99% of the subsidiary FCC Medio Ambiente Servicios Holding, S.A. and the
corresponding cash inflows (965,000 thousands of euros), all short-term debt held by the Company was
settled, so only the interests of the interim disbursements made in December and long-term bonds (note
9.a and 15.d) remain.

However, neither did the company use the financing facilities in the form of credit facilities and bilateral
loans with a maximum limit of 215,000 thousand euros with a number of financial institutions at 31
December 2023. They have annual maturity and interest rates referenced to Euribor plus a market
differential.

14. Trade creditors

In relation to the Spanish Accounting and Audit Institute (ICAC) Resolution dated 29 January 2016, enacted
in compliance with the Second Final Provision of Law 31/2014, of 3 December, which amends the Third
Additional Provision of Law 15/2010, of 5 July, stipulating measures to combat late payment in commercial
transactions, the following table provides information on the average payment period to suppliers for
commercial transactions arranged since the date of entry into force of Law 31/2014, i.e. 24 December 2014.

Additionally, Article 9, Chapter IV of Law 18/2022 of 28 September, on the creation and growth of companies,
introduces the obligation to report the following indicators: monetary volume and number of invoices paid in
a period less than the maximum established in the late-payment regulations and the percentage that these
represent from the total number of invoices and the total monetary value of payments to suppliers.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 23 of 44

Average payment period to suppliers

Ratio of paid operations/transactions

Ratio of operations/transactions pending payment

2023

Days

2022

Days

Amount

Total payments pending

Total payments made

Total payments made in a period less than the maximum
established in the late-payment regulations

Ratio (%)

Total number of invoices paid during the period

Number of invoices paid in a period less than the maximum
established in the late-payment regulations

Ratio (%)

5.828

66.559

30.562

46%

6.334

3.115

49%

6.878

61.623

24.765

40%

5.668

2.450

43%

15. Information on the nature and risk
of financial instruments

The concept of financial risk refers to changes in the financial instruments arranged by Fomento de
Construcciones y Contratas, S.A., as a result of political, market and other factors and their impact on the
financial statements. The risk management philosophy of the company and of FCC Group is consistent
with their business strategy, and seeks to achieve maximum efficiency and solvency at all times. To this
end, strict financial risk management and control criteria have been established, consisting of identifying,
measuring, analysing and controlling the risks incurred in the Group’s operations. The risk policy has been
integrated into the Group’s organisation in the appropriate manner.

In view of the company’s activities and the transactions through which it carries on its business, it is
currently exposed to the following financial risks:

493

a) Capital risk

To manage capital, the main objective of the company and of FCC Group is to reinforce its financial-equity
structure, in order to improve the balance between borrowed funds and shareholders’ equity, and the Group
endeavours to reduce the cost of capital and, in turn, to preserve its solvency status, in order to continue
managing its activities and to maximise shareholder value, not only at Group level, but also at the level of
the parent, Fomento de Construcciones y Contratas, S.A.

The essential base considered by the FCC Group to be capital is recognised under “Equity” in the balance
sheet. Given the sector in which they operate, the company and the Group are not subject to external
capital requirements, although this does not prevent the frequent monitoring of equity to guarantee
a financial structure based on compliance with the prevailing regulations of the countries in which it
operates, also analysing the capital structure of each of the subsidiary companies to enable an adequate
distribution between debt and capital.

Furthermore, in June 2022, the refinancing in the Water area was completed for the sum of 1,100 million
euros. Moreover, in July 2020, FCC Servicios Medioambiente Holding, S.A. registered, and since then
has renewed once a year, a promissory note programme, Euro Commercial Paper Programme (ECP), on
the Irish stock exchange, for a maximum amount of 400 million euros and in October 2023 refinanced
600 million euros through a new bond issue. Fomento de Construcciones y Contratas, S.A. has had a
promissory note programme - Euro Commercial Paper Program (ECP) - registered in that same market
since November 2018, for an amount of 600 million euros, with no active issuances as of 31 December
2023. In 2023 new financing facilities were also renewed and taken out in the form of lines of credit and
bilateral loans.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 24 of 44

494

b) Foreign currency risk

d) Solvency risk

A noteworthy consequence of FCC Group’s positioning in international markets is the exposure resulting
from net positions in foreign currencies against the euro or in one foreign currency against another when
the investment and financing of an activity cannot be arranged in the same currency.

Although the benchmark currency in which the company and the Group mainly operate is the euro, they
also hold financial assets and liabilities accounted for in currencies other than the euro. Exchange rate risk
is mainly found in debt denominated in foreign currency, except when this entails a natural hedge of the
assets financed since they are denominated in the same currency, in investments in international markets,
and in collections and payments in currencies other than the euro.

FCC Group’s general policy is to mitigate the adverse effect on its financial statements of exposure
to foreign currencies as much as possible, with regard to both transactional and purely equity-related
movements. The Group therefore manages the effect that foreign currency risk can have on the balance
sheet and the income statement.

c) Interest rate risk

Fomento de Construcciones y Contratas, S.A. and the FCC Group are exposed to the risk derived from
variations in interest rates because their financial policy aims to guarantee that their current financial
assets and debt are partially linked to variable interest rates. The benchmark interest rate for debt arranged
with credit entities in euros is mainly the Euribor.

Any increase in interest rates could give rise to an increase in financing costs associated with its
borrowings at variable interest rates, and could also increase the cost of refinancing the borrowings and
the issue of new debt.

In order to ensure a position that is in the best interests of the company and of FCC Group, an interest
rate risk management policy is actively implemented, with on-going monitoring of markets and assuming
different positions depending primarily on the asset financed.

The table below summarises the effect on the Company’s income statement of increases in the interest
rate curve with regard to gross debt:

Impact on profit or loss

+25 pb

766

+50 pb

1,531

+70 pb

2,297

+100 pb

3,062

Below is a table in which you can see the evolution of the net financial debt that appears in the attached
balance sheet.

Bank borrowings (note 13)

Debt instruments and other marketable securities (Note 13)

Financial payables to Group and associated companies (
notes 9.c and 9.d)

2023

—

2022

155,837

23,200

1,112,632

1,183,275

Financial loans with Group and associated companies (note 9.b)

(404,987)

(194,756)

Other current financial assets (note 8.b)

Cash and cash equivalents (Note 10)

(1,198)

(166,527)

(3,644)

(10,583)

539,993

1,153,329

The decrease in net financial debt shown in the table above is basically due to the cash inflows from the
sale of a 24.99% stake of FCC Environmental Services Holding, S.A. (notes 9.a and 13).

e) Liquidity risk

Fomento de Construcciones y Contratas, S.A. and its group of companies carry out their operations in
sectors that require a high level of financing, having to date obtained adequate financing to carry out
their operations. However, the company cannot guarantee that these circumstances relating to obtaining
financing will continue in the future.

The ability of the Company and the FCC Group to obtain financing depends on many factors, a lot of
which are beyond their control, such as general economic conditions, the availability of funds at financial
institutions, the depth and availability of the capital markets and the monetary policy of the markets in
which they operate. Adverse effects in debt and capital markets may hinder or prevent adequate financing
being available to develop the company’s activities

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 25 of 44

495

Historically, the FCC Group has always been able to renew its loan arrangements, and it expects to
continue doing so in the coming twelve months. However, FCC Group’s ability to renew its financing
depends on various factors, many of which are outside the control of the Group, such as general economic
conditions, the availability of funds for loans from private investors and financial institutions, and the
monetary policy of the markets in which it operates. Negative conditions in debt markets could hinder
or prevent FCC Group’s capacity to renew its financing. Accordingly, the FCC Group cannot guarantee
its ability to renew its financing on economically attractive terms. The inability to renew such loans or
to ensure financing under acceptable terms may have a negative impact on the liquidity of Fomento de
Construcciones y Contratas, S.A. and its Group companies, and on its ability to meet its working capital
needs.

To adequately manage this risk, the Group performs exhaustive monitoring of the repayment dates of all
credit facilities of each Group company, in order to conclude all renewals in the best market conditions
sufficiently in advance, analysing the suitability of the funding and studying alternatives if the conditions
are more unfavourable on a case-by-case basis. The Group is also present in several markets, which
facilitates the obtainment of credit facilities and the mitigation of liquidity risk.

g) Credit risk

The provision of services or the acceptance of client engagements, whose financial solvency was not
guaranteed at the acceptance date, situations not known or unable to be assessed and unforeseen
circumstances arising during the provision of the service or the execution of the engagement that could
affect the client’s financial position could generate a payment risk with respect to the amounts owed.

The company and FCC Group request commercial reports and assess the financial solvency of clients
before doing business and perform on-going monitoring, and have put in place a procedure to be
adopted in the event of insolvency. In the case of public-sector customers, the Group does not accept
commitments that do not have an assigned budget and financial approval. Offers that exceed a specific
payment period must be authorised by the Finance Division. Likewise, on-going monitoring is performed of
debt delinquency in various managing committees.

With regard to credit ratings, the Company and the FCC Group apply its best judgement to impair financial
assets on which it expects to incur credit losses over their entire lives. The Group regularly analyses
changes in the public ratings of the entities to which it is exposed.

f) Concentration risk

h) Risks generated by the Russian invasion of Ukraine

The risk arising from the concentration of lending transactions with common characteristics is distributed
as follows:

• Funding sources: in order to diversify this risk, the company and FCC Group work with a large number

of Spanish and foreign financial entities to obtain funds.

• Markets/geography (domestic, foreign): The FCC Group operates in a wide variety of national and

international markets, with the debt mainly concentrated in euros and the rest in various international
markets, with different currencies.

• Products: the company uses various financial products, such as loans, credit facilities, promissory

notes, syndicated loans, assignments and discounting.

FCC Group’s strategic planning process identifies the objectives to be attained in each of the areas of
activity, based on the improvements to be implemented, the market opportunities and the level of risk
deemed acceptable. This process serves as a base for preparing operating plans that specify the goals
to be reached each business year.

Given that the Group does not operate in the aforementioned geographic markets, no significant increase
in the credit risk of its financial assets has been seen; therefore, no additional impairments have been
recognised beyond those considered inherent to the different activities it performs. Furthermore, no
difficulties have been identified in the Group's ability to obtain financing.

The invasion has had a limited impact on the Company and its Group, meaning that the individual and
consolidated financial statements have been prepared applying the going concern principle, considering
that the effects described do not jeopardise the continuity of their activities.

• The Cement Area takes measures that are specified at each facility, taking into account the current

context of each one, its technological, human and economic resources, the applicable legislation and
the expectations of the interested parties. The objectives of such measures are to promote the circular
economy and to reduce greenhouse gas emissions by increasing material and energy recovery with
a greater use of decarbonised raw materials, recoverable waste and biomass fuels, increasing energy
efficiency through the optimisation of the fuel mix and the use of expert systems in the manufacturing
process and transition to LED lighting and increasing the mix of renewable energies through solar and/
or wind energy facility projects and boosting the consumption of biomass in clinker manufacturing.

Pursuant to the reporting requirements set out in the Taxonomy Regulation (EU) 2020/852, the FCC Group
has analysed the proportion of its economic activities that are eligible, and where appropriate, aligned and
non-aligned, and ineligible under the Environmental Taxonomy, in terms of business volume, CapEx and
OpEx relative to 2023. The Statement of Non-Financial Information that forms part of the Management
Report provides greater details about the results and methodology followed in the application of the
aforementioned Regulation, in particular specifying how the Group has analysed the climate risks affecting
all its activities.

As a result of the foregoing, these individual financial statements were prepared under the going concern
principle, since there are no doubts regarding the continuity of the Company and its group of companies.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 26 of 44

i) Climate change risks

The performance of the activities carried out by the FCC Group may be impacted by adverse weather
conditions, such as floods or other natural disasters and in some cases, by the decrease in temperature
that may hinder, or even prevent in extreme cases, the performance of their activities, such as the case of
intense frosts in the Construction business.

The Company and its Group of companies take all the appropriate measures to adapt to the effects
of climate change and mitigate its possible effects on their activity and fixed assets, as shown in the
corresponding environmental provisions, committing to the decarbonisation of the activities it carries out,
for which it uses the most efficient technologies in the fight against climate change and by the very nature
of some of the activities it carries out, it promotes the circular economy. In order to attain these objectives,
specific policies are implemented in the activities carried out:

• The Construction area has an Integrated Policy to analyse environmental incidents, the involvement of
the interested parties and the establishment of a plan to reduce the significant impacts of the activities
of the works, emphasising the mitigation of the generation of waste, the consumption of resources,
the generation of noise and vibrations, promoting the use of sustainable and reusable materials and
the sustainable use of water. It has environmental certifications in several of the countries in which it
operates, as well as environmental certification according to ISO 14001 at the centres located in Spain
at some of its main investees.

• The very nature of the Environmental Services Area aims to protect and conserve the environment

and contribute to the circular economy by treating waste as a resource, through its reuse and energy
recovery. Likewise, it uses technologies and equipment to optimise water consumption, promoting a
rational use and the use of water from alternative sources, such as the use of rainwater. As for policies
aimed at optimising energy consumption, Spain has an Energy Management System certified in
accordance with the ISO 50001 standard and projects for the use of landfill gas to generate electricity
and hot water.

• In 2021, the Water Area was the first company in the sector to certify the Strategy for the Contribution
of the Sustainable Development Goals, by AENOR. Furthermore, the Area has implemented energy
management policies with a view to optimising energy consumption at its facilities; this policy is
reflected in the calculation of the company's Carbon Footprint at its plants in Spain. The Area has
also implemented policies to reduce greenhouse gas emissions, through the signing of a PPA (Power
Purchase Agreement) contract for renewable energies (photovoltaic) and projects to install renewable
energy (photovoltaic) at some of its facilities.

16. Deferred taxes and tax situation

In accordance with file 18/89, as the parent, Fomento de Construcciones y Contratas, S.A. files
consolidated corporation tax returns, including all the Group companies that comply with the requirements
of the tax legislation.

a) Balances with public administrations and deferred taxes

a.1) Tax receivables

Non-current

Deferred tax assets

Current

Current tax assets

Other receivables from the public administrations

The breakdown of the “Deferred tax assets” heading is as follows:

Tax loss carryforwards and activated deductions (Note 16.e)

Non-deductible provisions

Rest

2023

2022

117,812

135,072

47,738

266

48,004

2023

95,674

14,770

7,368

53,743

280

54,023

2022

96,221

26,178

12,673

The management of Fomento de Construcciones y Contratas, S.A., the parent of the Tax Group 18/89,
has assessed the recoverability of deferred tax assets by estimating future tax bases relating to the
aforementioned Group, concluding that no doubts exist with respect to their recovery.

117,812

135,072

Provisions

Rest

497

The estimates used to assess the recoverability of deferred tax assets are based on the estimated future
tax bases, based on the pre-tax consolidated accounting result for the year from continuing activities,
which has been estimated based on the Strategic Plan prepared by the Group for the 2024-2026 period.
Turnover growth of 10.4% in 2024, 1.5% in 2025 and 2.9% in 2026 is assumed. In turn, the projected Ebitda
margin is 11% for 2024 and 12% and 2025 for 2026. During subsequent periods, vegetative growth is
projected at the level of pre-tax profit equal to 2%. Based on profit projections, it is estimated that there will
be sufficient positive taxable income to totally absorb both the tax losses recognised in the balance sheet
and the Tax Group's deferred tax assets.

During the period in which these financial statements were prepared, specifically on 20 February 2024,
the ruling the Constitutional Court declaring Royal Decree-Law 3/2016 as partially unconstitutional
was published in the Official State Gazette. In particular, the provisions introduced by these to limit the
compensation of tax loss carryforwards and to limit the application of deductions for double taxation,
as well as the reversal of portfolio tax impairments that took place between 2016 and 2020 were
considered unconstitutional. As a result, and to the extent that, at the time of preparing these financial
statements, there was no evidence of any law in the pipeline that would reintroduce these limits, with
the Group management considering that, in the coming years, only the limits to the compensation of tax
loss carryforwards indicated in the current regulations will be applicable, and equivalent to 70% of the tax
base prior to compensation. Taking into account this regulatory change and the profit projections made,
it is estimated that the tax group headed by Fomento de Construcciones y Contratas, S.A. will be able to
substantially absorb both the negative tax bases and deductions recognized on the balance sheet over an
estimated period of 6 years.

Already in 2022, and based on the positive growth expectations, the Company decided to recognise in
its financial reports all tax credits not used in previous years, which included negative tax bases and
deductions pending application, as well as temporary differences, largely due to the limitation of the
deductibility of financial expenses from previous years and provisions with a level of deductibility specified
in 2022 and, to a lesser extent, during this financial year. The breakdown of the aforementioned activation
by concepts (in terms of share) is as follows:

Tax loss carryforwards and deductions

Non-deductible finance costs

42,611

27,831

23,901

6,180

100,523

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 28 of 44

498

a.2) Payable balances

Non-current

Deferred tax liabilities

Current

Other government/public administration credits/loans:

Withholdings

VAT and other indirect taxes

Social Security bodies

2023

2022

The "Other adjustments" heading mainly includes the positive or negative differences between tax
estimates made at the end of the year and the subsequent settlement of the tax at the time of payment,
as well as, and specifically in 2023, the impact on the reassessment of future deductibility of certain
provisions.

369

402

182

438

1,022

407

2.119

472

333

2,924

b) Reconciliation of accounting profit and taxable income

The reconciliation between accounting profit and taxable profit for corporation tax purposes is as follows:

Accounting profit/(loss)
for the financial year
before tax

2023

2022

1,156,596

(59,172)

Additions

Reductions

Additions

Reductions

Permanent differences

1,502

(1,122,420)

(1,120,919)

193,372

(142,433)

50,939

a.3) Changes in deferred tax assets and liabilities

Movements in deferred tax assets and liabilities in the 2023 and 2022 business years were as follows:

Taxable temporary differences

Balance at 31.12.21

Arising in the year (Note 16.b)

Arising in prior years (note 16.b)

Activation of tax credits (note 16.a)

Other adjustments

Balance at 31/12/22

Arising in prior years (note 16.b)

Other adjustments

Total balance at 31.12.23

Deferred
tax assets

Deferred
tax liabilities

50,268

365

(25,285)

100,523

9,201

135,072

(1,885)

(15,375)

117,812

371

–

407

–

(38)

369

Adjusted accounting
profit/(loss)

Temporary differences
(Note 16.a)

- Arising in the year

- Originating from
previous years

Income and expenses
recognised directly in
equity

Tax base (taxable profit/
(loss)

35,677

(7,542)

(8,233)

(99,680)

–

1,459

–

1,459

(7,542)

–

(101,139)

(1,255)

(121)

26,880

(108,034)

Looking at the above table, the following is worth note:

• The permanent differences corresponding to both years have their origin basically in:

– It should be noted that the most significant value in 2023 is the 95% exemption from the sale of

24.99% of FCC Medio Ambiente Servicios Holding, S.A to CPP Investments (Note 9.a).

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 29 of 44

499

– Impairment on investments of the Tax Group 18/89 and at the remaining investees (Note 9).

e) Tax loss carryforwards and unused tax credits

– The exemption to avoid the double taxation of dividends. Corporate Income Tax Law 27/2014, of

27 November, eliminated the tax credit for the double taxation of dividends, substituting it with the
aforementioned exemption.

• The temporary differences in both financial years in essence correspond to the deductibility of financial
expenses during the year that were not deductible in previous years and that were activated during the
year 2022 (Note 16.a).

c) Reconciliation of accounting profit to the corporation tax expense

The reconciliation of accounting profit to the corporation tax expense was as follows:

Adjusted accounting profit/(loss)

Corporation tax charge

Activation of tax credits (note 16.a)

Other adjustments (Note 16.a)

Corporation tax expense/(income)

d) Breakdown of the corporation tax expense

The breakdown of Corporate Income Tax expense was as follows:

Current tax

Deferred tax (note 16.a)

Total tax (expense)/income

2023

35,677

(8,919)

–

(4,925)

2022

(8,233)

2,058

100,523

2,458

(13,844)

105,039

2023

8,693

(22,537)

2022

20,271

84,768

(13,844)

105,039

At year-end, the company had tax loss carryforwards from prior years pending offset amounting to
336,674 thousand euros, as a member of Tax Group 18/89, detailed as follows, by year:

2013

2014

2016

2019

2020

2022

Total

Amount

199,388

44,908

48,480

16,855

8,709

18,334

336,674

The company also has unused tax credits pending application from previous years amounting to 12,603
thousand euros. The breakdown is as follows:

Deducción

R+D+I Activities

Reinvestment

Creation of employment

Internal double taxation relief

Rest

Amount

Application deadline

6,781

4,688

749

312

12.603

18 years

15 years

Indefinite

—

The Company has capitalised all the tax bases pending compensation and deductions pending application
(Note 16.a).

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500

f) Financial years pending verification and inspection actions

g) Other tax information

Fomento de Construcciones y Contratas, S.A. has all the financial years not yet statute-barred open for
review by the tax authorities for the taxes applicable to them.

The following table includes the details of the “Corporation tax refunded/(paid)” heading in the statement
of cash flows for the 2023 and 2022 financial years..

In May 2023, the Tax Administration announced the start of corporate tax inspection activities involving
the tax group headed by Fomento de Construcciones y Contratas, S.A., for 2018 to 2020, as well as VAT
and withholdings/payments on account for employment income and income from professional services
corresponding to the period between April 2019 and December 2020 for Fomento de Construcciones
y Contratas S.A., FCC Construcción S.A., FCC Medio Ambiente S.A., FCC Industrial e Infraestructuras
Energéticas S.A. and Cementos Portland Valderrivas S.A.

In May 2019, the tax authorities completed a procedure to recover state aid, arising from European
Commission Decision 2015/314/EU, of 15 October 2014, relating to the tax amortisation of financial
goodwill from the indirect acquisition of foreign holdings. This procedure aims to adjust the tax incentives
applied by the company and FCC Group in prior years as a result of the acquisition of the Alpine,
FCC Environment (formerly the WRG Group) and FCC CEE (formerly the ASA Group) Groups. The tax
authorities made a payment for a total amount of 111 million euros (instalment and interest) to Fomento
de Construcciones y Contratas, Parent of the FCC Group. The company has settled this tax debt but has
also filed an economic-administrative appeal against it, which is pending resolution. The legal advisors
of Fomento de Construcciones y Contratas, S.A. consider it likely that the amounts already paid in this
recovery procedure will be returned. Within the framework of this procedure, the Tax Administration
recognised a negative tax base in favour of the FCC Group, which generated in previous years a tax credit
capitalised in the amount of 63.2 million euros (49 million euros at the Company).

In relation to the rest of the business years and taxes open for review, as a result of the criteria that the tax
authorities may adopt in the interpretation of the tax regulations, the outcome of the inspections currently
under way, or those that may be performed in the future for the years open for review, could generate
contingent tax liabilities whose amount cannot currently be quantified objectively. However, Group
management considers that the liabilities resulting from this situation would not have a significant effect
on the Group’s equity.

Corporate tax (IS) from previous years

Prepayments

Collections from/payments to Group companies for prior years'
corporation tax charge and corporation tax prepayments in the year

Withholdings and other

2023

55,954

(71,607)

46,146

(1,136)

29,357

2022

149,127

(52,811)

(45,224)

(652)

50,440

h) Pillar II Project

The OECD has promoted a project to establish a complementary tax to guarantee a global minimum level
of taxation for multinational groups (the so-called "Pillar II" project). Pillar II regulations have been enacted,
or substantially enacted, in certain jurisdictions in which the FCC Group operates. The legislation will be
effective for the Group's annual periods beginning on January 1, 2024. The Group is in the process of
assessing the potential exposure arising from the Pillar II legislation.

The assessment of potential exposure to Pillar II taxes is based on the most recent tax returns, country-by-
country reports and the financial statements of the entities that make up the Group.

Based on the assessments performed to date, the Group identified potential exposure to Pillar II taxes
on profits in the United Arab Emirates, Ireland, Georgia and Serbia, where the expected effective Pillar II
tax rate is likely to be lower than 15%. Potential exposure would come from entities, primarily operating
subsidiaries, in these jurisdictions where the effective Pillar II tax rate is less than 15%. However, exposure
may also exist in other jurisdictions where evaluation is ongoing.

Currently, there is no quantitative information available that indicates potential exposure to income taxes
under Pillar II. However, the total profit attributable to the jurisdictions with regard to the ones in which
there is an obligation to pay for complementary taxes currently represent no more than 2% of the Group's
total profit. Consequently, we consider that the implementation of the regulations derived from the Pillar II
project should not have a material effect on the future taxation of the FCC Group.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 31 of 44

501

17. Guarantee commitments to third parties
and other contingent liabilities

As of 31 December 2023, Fomento de Construcciones y Contratas, S.A. has issued guarantees with
credit institutions for an amount of 20,135 thousands of euros (30,951 thousands of euros as of 31
December 2022), of which 12,788 thousands of euros (18,302 thousands of euros as of 31 December
2022) correspond to deposited guarantees to respond to obligations contracted with Group companies,
primarily from companies operating in the Environmental sector. The rest correspond to guarantees in
procedures with the Public Administrations in the countries in which the Company operates. In both cases,
the decrease seen during the year can be attributed to the transfer of guarantees to companies for the
aforementioned activity.

Fomento de Construcciones y Contratas, S.A. has also appeared as the respondent in some lawsuits.
However, the company's directors consider that the resulting liabilities would not have a material effect on
the company's equity.

The possible financial effects of the main contingent liabilities derived from the bankruptcy of the Alpine
subgroup would be the cash outflows indicated in the respective lawsuits detailed in Note 12 of this report,
a risk not considered likely.

On 15 January 2015, the Competition Chamber of the National Markets and Competition Commission
issued a decision on file S/0429/12, for an alleged violation of Article 1 of Law 15/2007 on the Defence
of Competition. The aforementioned resolution affects several companies and associations in the waste
sector, including companies belonging to the Group. The Group has filed an administrative appeal before
the Spanish National Appellate Court. At the end of January 2018, the Judgments issued by the National
Court were notified, upholding the contentious-administrative appeals filed by Gestión y Valorización
Integral del Centro, S.L. and Betearte, S.A. Unipersonal, both companies owned by FCC Servicios
Medioambiente Holding, S.A., against the CNMC's ruling imposing several sanctions for alleged collusive
practices. In both decisions, the argument put forward by these companies that no single, on-going breach
existed was upheld. In April 2018, we were notified of the agreement initiating new legal proceedings for
the same conduct investigated in the previous proceedings forming the scope of the upholding decision,
commencing an 18-month examining period. In September 2019, an agreement was issued suspending
the processing of the sanctioning file until the National Court ruled on the appeals presented by other
sanctioned companies. On 22 March 2023, a ruling was handed down by the CNMC's Competition
Chamber agreeing to archive the disciplinary case. The Chamber ruled that it was no longer appropriate to
continue with the proceedings and that the case should be archived, for the purposes of all parties.

In 2019, as a result of an internal investigation in May in application of its compliance policy and
regulations, the FCC Group became aware of the existence of payments between 2010 and 2014, initially
estimated at 82 million dollars, which might not be justified and, may, therefore be illegal. These acts were
uncovered as a result of application of the procedures in the Group's compliance rules. The company
has informed prosecutors in Spain and Panama about these acts, and has been providing the utmost
cooperation since then to clarify what happened, applying the "zero tolerance" principle for corruption that
permeates the entire FCC Compliance System.

The case is still in the investigation period, without us being able to determine at this time what type of
charges could be filed, if any. It should be noted that during 2023, the UCO (Central Operational Unit of the
Civil Guard) issued a report, referred to in various press articles, in which other amounts differing from
than those reported by Fomento de Construcciones y Contratas, S.A. are mentioned, although it must
be noted that these reports refer to behaviours conduct and sums of money that cannot all be attributed
to the Group. For all these reasons, we classify it as possible that economic impacts could arise for the
aforementioned companies, as a result of the aforementioned procedure, although we do not have the
necessary information that allows us to establish a quantification of them.

On 6 July 2022, the National Markets and Competition Commission issued a resolution imposing a sanction
on several construction companies, including FCC Construcción, S.A. for sharing the costs of technical work
to verify objective data in relation to public works tenders. The Group considers that the sanctioned conduct
not only fails to infringe any precept (including those contained in the competition law) but that this conduct
has also contributed to greater efficiency and cost savings in tenders. For these and other reasons, it filed
the corresponding contentious-administrative appeal before the National Court, which is still being heard.
Furthermore, it asked said court to grant a precautionary measure for the suspension of the payment of the
fine imposed by the CNMC until a final court ruling is handed down on this matter. This request was upheld.
Therefore, it has been considered that, although this sanction may result in cash outflows, at present and
given the situation we cannot estimate the corresponding amount and payment schedule.

502

The sale of 24.99% of the stake in FCC Servicios Medio Ambiente Holding, S.A. to the Canadian pension
fund, CPP Investments (note 9.a), incorporates a contingent price clause in relation to the cash flows
produced by certain assets included in the scope of the sale. Given that the value of collections or
payments cannot be determined with sufficient reliability and given the uncertainty of the time at which
they may occur, no assets or liabilities have been recognised. In addition, it is estimated that the net value
of these collections or payments will not be relevant.

Additionally, the 2018 agreement for the sale of the 49% FCC Aqualia holding envisages certain variable
prices that depend on the resolution of contingent proceedings. Accordingly, the company did not
recognise any assets due to their contingent nature, nor has it recognised liabilities for claims that may
arise against their interests, since it was not considered probable that material losses would occur and
given their insignificant amount with respect to the transaction price.

Also, as part of the aforementioned sales transaction, FCC Topco s.a.r.l. and its subsidiary FCC Midco, S.A.
were constituted, contributing shares representing 10% of the Group's shares in FCC Aqualia to the latter.
The aforementioned shares are pledged as collateral for certain obligations of the Group towards FCC
Aqualia, mainly for the repayment of the loan that the latter has granted to Fomento de Construcciones
y Contratas, S.A. for the amount of 806.479 thousands of euros as of December 31. At the date of
authorisation for issue of these financial statements, the Group believes that there is no risk that these
guarantees will be enforced.

The company is involved in other lawsuits and legal procedures aside from those already described that it
considers will not generate significant cash outflows.

The company’s stake in joint operations managed through joint ventures, joint ownership, participation
accounts and other similar arrangements means that participants share joint and several liability for the
activities performed.

18. Income and expenses

In addition to sales and services, revenue includes dividends and accrued interest arising from finance
extended to investees (Note 4.h).

The "Sales and provision of services" heading mainly includes billings for management support services
provided by Fomento de Construcciones y Contratas, S.A. to other Group companies. However, in 2022,
25,437 thousands of euros were posted, corresponding to an environmental services contract in the
US, awarded to Fomento de Construcciones y Contratas, S.A. at the end of the financial year 2021.
Subsequently, an authorisation process began with the US local authorities for the transfer of this contract
to the US subsidiary FCC Environmental Services Florida, Llc. which was completed successfully in
November 2022, so in 2023 there is no significant revenue in Fomento de Construcciones y Contratas,
S.A. from this contract. Additionally, in relation to this type of contract, in 2019 an agreement was formally
entered into between the Company and the subsidiary, FCC Medio Ambiente, S.A., to assign economic
rights and obligations to the latter, for contracts awarded directly to the Company until its transfer is
possible.

Details of "Staff expenses" are shown below:

Wages and salaries

Employee welfare costs

2023

19,656

4,698

24,354

2022

22,331

6,300

28,631

The company has not obtained any significant assets as a result of the guarantees enforced in its favour
or released.

In 2022, staff expenses corresponding to the aforementioned environmental service contracts were
included for 4,518 thousand euros.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 33 of 44

503

The detail of "Other operating expenses" is as follows:

External services related to information technologies

Leases

Royalties

Independent professional services

Insurance premiums

Repairs and preservation

Supplies and procurements

Banking and similar services

Other services

2023

20,063

10,623

9,947

3,431

544

393

268

110

10,870

56,249

2022

18,903

10,721

8,232

3,968

1,377

1,804

10,292

160

19,869

75,328

Lastly, in the financial year 2022, the "Changes in the fair value of financial instruments" heading included
income of 2,441 thousand euros for an adjustment to the sale price of the company FCC Aqualia, S.A. The
agreement to sell 49% of the aforementioned company, formalized in 2018, included a contingent price
clause (note 17). It should be noted that the conditions established for its collection have been met.

19. Operations and balances with related parties

a) Transactions with related parties

Details of transactions with related parties in 2023 and 2022 are as follows:

(wholly
owned) Group
Companies

Joint ventures

Associates

Total

Also in this case, in 2022, 20,857 thousand euros were included corresponding to the environmental
services contracts mentioned above.

2023

“Finance income from marketable securities and other financial instruments of Group companies and
associates” includes the accrued interest arising from the financing granted to investees (Note 9),
including most notably:

FCC Servicios Medio Ambiente Holding, S.A.

FCC Concesiones e Infraestructuras, S.L.U.

FCyC, S.A.

Realia Business, S.A.

Rest

2023

9,216

2,489

3,843

3,759

440

2022

9,082

2,534

1,530

1,124

449

19,747

14,719

Trade receivables for sales and services

Other operating income

Receipt of services

Dividends

Financial expenses

Financial income

2022

Trade receivables for sales and services

Other operating income

Receipt of services

Dividends

Financial expenses

Financial income

60,915

38,347

9,432

12,485

38,039

19,746

58,904

35,050

18,175

15,435

34,830

14,719

—

181

—

147

—

1,801

—

387

—

60,915

38,528

9,432

14,286

38,039

19,747

58,904

35,197

18,175

15,822

34,830

14,719

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 34 of 44

504

b) Balances with related parties

The detail of the balances with related parties at year-end was as follows:

The details of trade receivables from and trade payables to Group companies and associates are as
follows:

(wholly
owned) Group
Companies

Joint ventures

Associates

Total

Company

FCC Aqualia, S.A.

FCC Construcción, S.A.

FCC Medio Ambiente, S.A.

—

409,471

Hidrotec Tecnología del Agua, S.L.U.

4,367

3,717,258

FCC Environmental Services (USA) Llc.

FCC Environmental Services Florida Llc.

Rest

2023

2022

Receivables

Payable

Receivables

Payable

3,585

3,054

1,959

1,429

456

430

1,134

12,047

130

–

344

–

964

649

3,437

1,703

10,723

1,340

–

7,713

1,270

169

–

119

–

1,750

9,330

596

2,090

26,186

11,964

2023

Current financial assets (Note 9)

409,471

Non-current financial assets (Note 9)

3,712,891

Current payables (Note 9)

Non-current payables (Note 9)

Trade receivables

Trade payables

2022

362,650

806,479

11,995

2,090

Current financial assets (Note 9)

199,452

Non-current financial assets (Note 9)

3,413,898

Current payables (Note 9)

Non-current payables (Note 9)

Trade receivables

Trade payables

413,058

806,479

26,182

11,964

—

362,650

806,479

12,047

2,090

—

199,452

4,367

3,418,265

—

413,058

806,479

26,186

11,964

c) Transactions with directors of the Company and senior

executives of the Group

The directors of Fomento de Construcciones y Contratas, S.A. accrued the following amounts at the
company, in thousands of euros:

Fixed remuneration

Other payments

2023

735

1,245

1,980

2022

650

1,090

1,740

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 35 of 44

505

The senior executives listed below, who are not members of the Board of Directors, received total
remuneration of 2,180 thousand euros (5,793 thousand euros in the 2022 financial years).

Details of Board members who hold posts at companies in which Fomento de Construcciones y Contratas,
S.A. has a direct or indirect ownership interest were as follows:

2023

Marcos Bada Gutiérrez

Felipe B. García Pérez

General manager of Internal Audit

General Secretary

Miguel Ángel Martínez Parra

Managing Director of Administration and Finance

Félix Parra Mediavilla

Jaime Rocha Font

2022

Marcos Bada Gutiérrez

Felipe B. García Pérez

Managing Director of FCC Aqualia

CEO of Cementos Portland Valderrivas

General manager of Internal Audit

General Secretary

Miguel Ángel Martínez Parra

Managing Director of Administration and Finance

Félix Parra Mediavilla

Managing Director of FCC Aqualia

Under Article 38.5 of the Articles of Association, the Company has taken out a third-party liability insurance
policy covering directors and executives. This is a collective policy covering all the Group’s executives, with
a premium of 1,284 thousand euros being paid in 2023.

The Company has taken out an accident insurance policy for its directors, encompassing both the exercise
of their functions and their private life, comprising coverage in the event of death, total and absolute
permanent incapacity and severe disability. The premium paid in the business year amounted to 5
thousand euros.

Except as indicated in the preceding paragraphs, no other remuneration, advance payments, loans or
guarantees were granted to the Board of Directors, nor were any obligations assumed in terms of pensions
and life insurance policies by current and former members of the Board of Directors.

Name or corporate name
of the director

Company name of the Group entity

Position

ALICIA ALCOCER KOPLOWITZ CEMENTOS PORTLAND

VALDERRIVAS, S.A.

CHAIRWOMAN (ACTING ON
BEHALF OF EAC INVERSIONES
CORPORATIVAS, S.L.)

REALIA BUSINESS, S.A.

DIRECTOR

GERARDO KURI KAUFMANN

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

NON-EXECUTIVE VICE PRESIDENT

REALIA BUSINESS, S.A.

NON-EXECUTIVE VICE PRESIDENT

FCyC, S.A.

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

NON-EXECUTIVE VICE PRESIDENT

JUAN RODRÍGUEZ TORRES

REALIA BUSINESS, S.A.

NON-EXECUTIVE CHAIRMAN

FCC AQUALIA, S.A.

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

ALVARO VÁZQUEZ DE
LAPUERTA

ALEJANDRO ABOUMRAD
GONZÁLEZ

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

REPRESENTATIVE OF THE
DIRECTOR INMOBILIARIA AEG, S.A.
DE C.V.

FCC AQUALIA, S.A.

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

CHAIRMAN

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 36 of 44

506

Name or corporate name
of the director

Company name of the Group entity

Position

PABLO COLIO ABRIL

FCC CONSTRUCCIÓN, S.A.

CHAIRMAN

FCC ENVIRONMENT (UK) LIMITED

DIRECTOR

FCC MEDIO AMBIENTE REINO UNIDO,
S.L.U.

DEPUTY CHAIRMAN

FCC MEDIO AMBIENTE, S.A.U.

CHAIRMAN

e) Transactions with related parties

During the business year, a number of transactions took place involving companies in which shareholders
of Fomento de Construcciones y Contratas, S.A. own equity interests, the most significant of which were
as follows:

• Execution of construction and service provision contracts between Group companies and investees by

other parties related to the controlling shareholder, as follows:

DEPUTY CHAIRMAN

Buyer

Seller

FCC SERVICIOS MEDIO AMBIENTE
HOLDING, S.A.

FCC AQUALIA, S.A.

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

ESTHER ALCOCER
KOPLOWITZ

CARMEN ALCOCER
KOPLOWITZ

FCC AUSTRIA ABFALL SERVICE AG

CHAIRMAN

REALIA BUSINESS, S.A.

DIRECTOR

CEMENTOS PORTLAND
VALDERRIVAS, S.A.

DIRECTOR

In 2023, no significant transactions were performed entailing a transfer of assets or liabilities between
Group companies and their executives and directors.

d) Situations of conflicts of interest

No direct or indirect conflicts of interest arose in respect of the company’s activities, under the applicable
regulations (article 229 of the Spanish Limited Liability Companies Law), without prejudice to the
company’s transactions with its related parties set forth in these notes to the financial statements or,
where appropriate, agreements related to remuneration matters or appointments. In this regard, when
specific conflicts of interest have taken place with certain directors, they have been resolved in accordance
with the procedure stipulated in the Board of Directors’ Rules, with the directors involved abstaining from
the corresponding debates and votes.

Realia Patrimonio, S.L.U.

FCC Industrial e Infraestructuras Energéticas
S.A.U.

FCC Medio Ambiente,S.A.

Servicios Especiales de Limpieza,S.A.

Fedemes,S.L.

Fomento de Construcciones y Contratas,S.A.

2023

1,047

180

494

2022

926

174

508

Realia Business, S.A.

FCC Construcción, S.A.

6,772

6,326

Fomento de Construcciones y Contratas,S.A.

Fedemes,S.L.

FCyC, S.A.

Residencial Turo del Mar,C.B.

Jezzine Uno,S.L.U.

172

142

348

163

130

175

FCyC, S.A.

FCC Construcción, S.A.

41,050

30,170

FCC Ambito,S.A.

Fomento de Construcciones y Contratas,S.A.

Fedemes,S.L.

Realia Business, S.A.

Hermanos Revilla,S.A.

Servicios de Limpieza,S.A.

Fedemes,S.L.

Jezzine Uno, S.L.U.

Realia Business, S.A.

Fedemes,S.L.

–

140

3,780

127

104

130

3,560

134

AS Cancelas Siglo XXI, S.L.

Realia Business, S.A.

2,094

1,990

Receivable

FCyC, S.A.

Payable

Asesoria financiera y de gestión,S.A.

2023

170

2022

257

Fomento de Construcciones y Contratas,S.A.

227,485

118,474

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 37 of 44

Buyer

Seller

FCC Real Estate UK

Grupo FCC Environment (UK)

Cementos Portland
Valderrivas,S.A.

Realia Patrimonio, S.L.U.

Fomento de Construcciones y
Contratas,S.A.

Realia Patrimonio, S.L.U.

Fedemes, S.L.

Realia Patrimonio, S.L.U.

Giant Cement Holding Inc.

Cementos Portland Valderrivas, S.A.

Giant Cement Company

Uniland Trading B.V.

Coastal Cement Corporation

Uniland Trading B.V.

2023

568

272

5,771

13,550

2022

–

429

–

9,907

In addition, the following balance sheet balances are maintained:

Receivable

Payable

2023

2022

Realia Patrimonio, S.L.U.

Cementos Portland Valderrivas,S.A.

Fomento de Construcciones y Contratas,S.A.

FCC Industrial e Infraestructuras
Energéticas S.A.U.

FCC Medio Ambiente,S.A.

Servicios Especiales de Limpieza,S.A.

Realia Business, S.A.

Fedemes,S.L.

Fomento de Construcciones y Contratas,S.A.

FCC Construcción, S.A.

FCC Industrial e Infraestructuras
Energéticas S.A.U.

FCyC, S.A.

132

412

231

99,936

1,891

132

377

273

70,122

4,629

211

FCC Construcción, S.A.

FCC Industrial e Infraestructuras
Energéticas S.A.U.

Costa Verde Habitat,S.L.

Jezzine Uno,S.L.U.

Realia Business, S.A.

Fedemes,S.L.

76,776

55,040

FCC Real Estate (UK) Limited

FCC Environment (UK) Limited

FCyC, S.A.

Vela Borovica Koncern d.o.o.

FCyC, S.A.

Costa Verde Habitat, S.L.

FCyC, S.A.

Planigesa, S.A.

Servicios Especiales de Limpieza,S.A.

10,109

3,316

–

1,993

37,043

1,440

4,005

207

189

2,340

17,618

1,437

–

126

–

Fomento de Construcciones y Contratas,S.A.

Fedemes,S.L.

FCC Industrial e Infraestructuras
Energéticas S.A.U.

Realia Patrimonio, S.L.U.

2,290

2,409

Valaise, S.L. Unipersonal

Fomento de Construcciones y
Contratas,S.A.

Realia Business, S.A.

FCyC, S.A.

Residencial Turo del Mar,C.B.

Realia Business, S.A.

Hermanos Revilla, S.A.

Servicios Especiales de Limpieza,S.A.

Jezzine Uno, S.L.U.

Fedemes,S.L.

FCyC, S.A.

Realia Business, S.A.

Fedemes,S.L.

4,549

32,649

–

3,805

3,044

–

AS Cancelas Siglo XXI, S.L.

Realia Business, S.A.

8,370

10,012

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 38 of 44

508

Receivable

Payable

FCC Industrial e
Infraestructuras
Energéticas S.A.U.

Realia Patrimonio, S.L.U.

Realia Business, S.A.

FCC Construcción, S.A.

FCyC, S.A.

Realia Business, S.A.

FCC Environment (UK) Limited

FCC Real Estate (UK) Limited

Fedemes, S.L.

Realia Patrimonio, S.L.U.

Realia Business, S.A.

Residencial Turo del Mar,C.B.

Giant Cement Holding Inc.

Cementos Portland Valderrivas, S.A.

Uniland Acquisition
Corporation

Uniland International B.V.

Giant Cement Company

Uniland Trading B.V.

Coastal Cement Corporation

Uniland Trading B.V.

2023

–

330

1,36

–

4,692

1,628

3,341

2022

105

459

–

186

291

5,307

–

1,729

413,5834

276,025

• Contract for the provision of IT services by Claro Enterprise Solutions, S.L. to Fomento de

Construcciones y Contratas, S.A. in the amount of 15,146 thousand euros (15,662 thousand euros
in 2021).

• Commercial operations within the Cement segment with the company Trituradora y procesadora de
materiales Santa Anita S.A. de C.V. of the Elementia Group for an amount of 22,606 thousand euros
(9,390 thousand euros in 2022), with the debt pending collection as of 31 December 2023 being
713 thousand euros (2,011 thousand euros as of 31 December 2022).

• Acquisition by FCyC, S.A. of a 12.19% stake in Realia Business, S.A. from Soinmob Inmobiliaria

Española, S.A.U. for the amount of 105,000 thousand euros (Note 4).

• Acquisition by FCyC, S.A. of 3.99% of Metrovacesa from Control Empresarial de Capitales, S.A. de C.V.

for an amount of 49,571 thousand euros (Note 4).

• Acquisition by FCyC, S.A. of 1.95% of Metrovacesa from Soinmob Inmobiliaria Española, S.A.U. for an

amount of 24,233 thousand euros (Note 4).

• Granting of a loan by Fomento de Construcciones y Contratas, S.A. to Realia Business, S.A. for an

amount of 40,000 thousand euros.

• Granting of a loan by Fomento de Construcciones y Contratas, S.A. to FCyC, S.A. for an amount of

178,804 thousand euros.

• Agreement for the provision of services between Fomento de Construcciones y Contratas, S.A. and

Vilafulder Corporate Group, S.L.U. for a total annual amount of €355 thousand.

• Novation of the intragroup loan between Fomento de Construcciones y Contratas, S.A. and Realia

Business, S.A. to extend its maturity, the amount of the loan being 65,000 thousand euros.

• Agreement for the provision of services between Cementos Portland Valderrivas, S.A. and Gerardo Kuri

Kaufmann for €184 thousand.

• Contract for the provision of services between Cementos Portland Valderrivas, S.A. and Mr. Jaime

Rocha Font, for the amount of 150 thousand euros.

• Agreement for the provision of services between Realia Business, S.A. and Gerardo Kuri Kaufmann for

€184 thousand.

• In the framework of the debt refinancing associated with the Spanish activities of the Cementos
Portland Valderrivas Group in 2016, a subordinated loan agreement was entered into with Banco
Inbursa, S.A., Institución de Banca Múltiple, with carrying amount at 31 December 2022 of 50,405
thousand euros (70,405 thousand euros in 2022). On 20 October 2022, the extension of its maturity
until 20 October 2025 was signed off. The financial expenses accrued during the year amounted to
2,703 thousand euros.

• Contracts for the provision of cleaning services by Servicios Especiales de Limpieza, S.A. to Realia

Patrimony, S.L.U. and Hermanos Revilla, S.A. for an amount of 511 thousands of euros and a one-year
duration.

• Contracts for the provision of cleaning services by FCC Medio Ambiente, S.A. to Realia Patrimony, S.L.U.

for an amount of 177 thousands of euros and a one-year duration.

• Contracts for the provision of maintenance services by FCC Industrial e Infraestructuras Energéticas

S.A.U. to Realia Estate, S.L.U. for an amount of 755 thousands of euros and a one-year duration.

• Contracts for real-estate development management and marketing services provided by Realia

Business, S.A. to FCC, S.A. for an amount of 12,538 thousands of euros.

• Work execution contract by FCC Construcción, S.A. to Realia Business, S.A. for an amount of 19,851

thousand euros.

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 39 of 44

509

• Authorisation for the sale of dump sites in the United Kingdom to FCC Real State (UK) Ltd., both those

• Granting of a guarantee by Fomento de Construcciones y Contratas, S.A. for an amount of 30,000
thousands of euros to FCC Real Estate (UK) Ltd. in relation to the risks of the transferred landfills.

Furthermore, other transactions are carried out under market conditions, mainly telephone and internet
access services, with parties related to the majority shareholder for a non-significant amount.

21. Other information

a) Personnel

The average number of people employed by the company in the 2023 and 2022 financial years was as
follows:

f) Mechanisms established to detect, determine and resolve possible
conflicts of interests between the parent and/or its Group and its
directors, executives or significant shareholders

FCC Group has established specific mechanisms to determine and resolve any possible conflicts of
interest between the Group companies and their directors, executives and significant shareholders, as
indicated in article 20 and thereafter of the Board of Directors’ Rules.

Directors and managers

Supervisors

Technicians

Clerical Staff

Sundry trades

2023

2022

142

283

139

282

20. Information on the environment

The table below details the average number of people with a disability of 33% or more in 2023 and 2022,
pursuant to Royal Decree 602/2016, of 2 December, which introduced new disclosure requirements for
companies' financial statements:

As indicated in Note 1 to these financial statements, Fomento de Construcciones y Contratas, S.A. is the
parent of FCC Group, which carries out diverse activities that, due to their characteristics, specifically
focus on controlling environmental impact. These aspects are described in detail in the “Corporate Social
Responsibility” document published annually by the Group through various channels, including the www.
fcc.es website. Readers are advised to refer to this information as the best representation of this Note.

Technicians

Clerical Staff

Sundry trades

2023

2022

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 40 of 44

510

The numbers of employees, directors and senior managers at the company as at 31 December 2023 and
2022, broken down by gender, were as follows:

b) Remuneration to auditors

Men

Women

Total

The fees incurred for auditing and other professional services provided to the Company by the principal
auditor, Ernst & Young, S.L. and other participating auditors in 2023 and 2022, are as follows:

2023

Directors

Senior executives

Directors and managers

Supervisors

Technicians

Clerical Staff

Sundry trades

2022

Directors

Senior executives

Directors and managers

Supervisors

Technicians

Clerical Staff

Sundry trades

—

158

139

146

297

Audit services

Other assurance services

Total audit and related
services

Tax advisory services

Other services

Men

Mujeres

Total

Total professional services

2023

Principle
auditor

Other
auditors

385

408

–

408

–

786

828

Total

385

408

786

828

2022

Principle
auditor

Other
auditors

306

329

–

582

649

Total

306

329

582

649

978

TOTAL

1.236

329

—

156

136

138

292

The average number of employees, directors and senior executives of the company, distributed by men
and women, was as shown below in the 2023 and 2022 financial years:

Men

Women

2023

156

137

293

2022

158

135

293

22. Subsequent events

After the closing date of these consolidated financial statements, on 20 February 2024, the Official State
Gazette published the ruling of the Spanish Constitutional Court, which considers Royal Decree-Law
3/2016 to be partially unconstitutional. The Management of Fomento de Construcciones y Contratas,
S.A., parent company of Tax Group 18/89, considers that this event occurred after the closing date of the
consolidated financial statements and, therefore, requires the corresponding adjustments to be made,
since the ruling has declared part of the Royal Decree mentioned above to be without validity or effect,
considering this as a situation that already existed before the balance sheet closing date. Therefore,
as of 31 December 2023, the Company has registered the accounting impacts of this ruling, which has
increased the reimbursement limit of payments on account made during the financial year 2023, without
any impact on the Company's net equity or the profit/(loss) for the financial year (Note 16.a.1).

511

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 41 of 44

Annex I Group companies at 31 december 2023

Company

Asesoría Financiera y de Gestión, S.A.U.
Federico Salmón, 13 - Madrid
-Holding company-

Cementos Portland Valderrivas, S.A.
Dormilatería, 72 – Pamplona
-Cements-

Egypt Environment Services SAE
El Cairo – Egipto
-Urban sanitation-

FCC Aqualia, S.A.
Federico Salmón, 13 – Madrid
-Water management-

FCC Concesiones de Infraestructuras, S.L.U.
Avenida Camino de Santiago, 40 – Madrid
-Concessions-

FCC Construcción, S.A.
Balmes, 36 – Barcelona
-Construction-

FCC Servicios Medioambiente Holding, S.A.
Federico Salmón,13 - Madrid
-Environmental Services-

FCC TopCo S.à.r.l
48, Boulevard Grande-Duchesse Charlotte Luxembourg
-Holding company-

FCyC, S.A.
Federico Salmón, 13 – Madrid
-Real Estate-

Fedemes, S.L.U.
Federico Salmón, 13 – Madrid
-Real Estate-

TOTAL

Book value

2023 profit/loss

Assets

14,010

Impairment

Holding %

100

1,019,754

361,017

99.51

7,760

7,734

91,115

107,011

1,752,075

368,714

225,753

22,263

777,761

11,782

dta. 97.00
indt. 3.00

dta. 41.00
indt. 10.00

100

75.01

100

80.03

100

Dividends
received

Capital

6,842

Reserves

18,240

Other net equity
line items

Operating profit
or loss

Continuing
operations

344

7,114

233,955

206,376

692

89,284

56,919

8,000

(1,785)

(6,069)

(193)

(150)

12.,485

145,000

508,930

8,330

137,218

49,472

21,401

29,052

220,000

611,639

10,000

240,926

22,247

55,745

920,434

10,301

15,549

5,631

4,684

56,495

275,572

44,031

10,344

(36)

(41)

14,792

88,053

715

666

4,029,284

737,472

12,485

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 42 of 44

Annex I Group companies at 31 december 2022

Company

Asesoría Financiera y de Gestión, S.A.U.
Federico Salmón, 13 - Madrid
-Holding company-

Cementos Portland Valderrivas, S.A.
Dormilatería, 72 – Pamplona
-Cements-

Egypt Environment Services SAE
El Cairo – Egipto
-Urban sanitation-

FCC Aqualia, S.A.
Federico Salmón, 13 – Madrid
-Water management-

FCC Concesiones de Infraestructuras, S.L.U.
Avenida Camino de Santiago, 40 – Madrid
-Concessions-

FCC Construcción, S.A.
Balmes, 36 – Barcelona
-Construction-

Book value

Assets

14,010

Impairment

Holding %

100

1,019,673

442,817

99.50

7,760

6,425

91,115

1,752,075

549,734

FCC Servicios Medioambiente Holding, S.A.U.
Federico Salmón,13 - Madrid
-Environmental Services-

FCC TopCo S.à.r.l
48, Boulevard Grande-Duchesse Charlotte Luxembourg
-Holding company-

300,964

22,263

FCC Versia, S.A.U.
Avenida Camino de Santiago, 40 – Madrid
-Management company-

FCyC, S.A.
Federico Salmón, 13 – Madrid
-Real Estate-

Fedemes, S.L.U.
Federico Salmón, 13 – Madrid
-Real Estate-

TOTAL

62,624

777,761

11,782

4,060,089

1,061,600

15,435

512

Dividends
received

Capital

6,842

Reserves

12,785

Other net equity
line items

Operating profit
or loss

Continuing
operations

266

5,455

2022 profit/loss

233,955

335,796

6,978

(153,277)

(129,417)

8,000

(618)

(5,993)

(1,669)

(1,167)

12,485

145,000

420,783

7,330

68,808

103,445

2,109

220,000

566,276

10,000

229,988

2,950

19,335

120

(37,706)

677

451

97,514

45,363

39,237

10,937

(33)

2,962

(5)

8,946

55,745

693,383

4,258

34,454

29,223

10,301

14,297

1,362

1,252

dta. 97.00
indt. 3.00

dta. 41.00
indt. 10.00

100

80.03

100

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 43 of 44

513

Annex II Joint ventures

ALCANTARILLADO MADRID LOTE D

AQUALIA-FCC-VIGO

CENTRO DEPORTIVO GRANADILLA DE ABONA

FCC SANEAMIENTO LOTE D

LOTE 4 CULEBRO A

MANCOMUNIDAD DE ORBIGO

REDONDELA

% Participación

0.01

1.00

100.00

1.00

0.01

Fomento de Construcciones y Contratas, S.A. | Notes to the financial statements | Page 44 of 44

Annex III Associates and jointly controlled entities

At 31 December 2023

Book value

2023 profit/loss

Company

Suministros de Agua de Queretaro S.A. de C.V.
Santiago de Queretaro (Méjico)
-Water management-

TOTAL

Assets

4,367

Impairment

Holding %

dta. 24.00
indt. 2.00

—

At 31 December 2022

Book value

Company

Suministros de Agua de Queretaro S.A. de C.V.
Santiago de Queretaro (Méjico)
-Water management-

TOTAL

Assets

4,367

Impairment

Holding %

dta. 24.00
indt. 2.00

—

Dividends
received

1,801

Dividends
received

387

Capital

18,196

Reserves

29,527

Other net equity
line items

Operating profit
or loss

Continuing
operations

(2,247)

12,623

8,854

Capital

18,196

Reserves

23,584

Other net equity
line items

Operating profit
or loss

Continuing
operations

(7,916)

10,741

5,639

2022 profit/loss

515

Management Report
FOMENTO DE CONSTRUCCIONES Y CONTRATAS, S.A. at 31 December 2023

1. Status of the entity

2. Business performance and results

3. Liquidity and capital resources

4. Major risks and uncertainties

5. Acquisition and disposal of own shares

6. Significant events occurring after the end of the year

7. Outlook

8. R&D+I Activities

9. Other relevant information. share performance and other information

10. Definition of alternative performance measures according

to ESMA regulations (2015/1415en)

11. Annual Corporate Governance Report

12. Annual Directors' Remuneration Report

516

520

538

540

541

545

550

555

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 1 of 45FCC. Annual Report 20231_Letter from the Chairwoman and CEO2_Ethical governance at the highest level3_Strategy and value creation4_FCC in 20235_ Business linesA1_ Financial StatementsA2_Sustainability ReportFomento de Construcciones y Contratas, S.A. | Management Report | Page 2 of 45

516

1. Status of the entity

The Administration area directs the administrative management of the Group, and has, among others,
the following functions in relation to the Information and Internal Control Systems:

Fomento de Construcciones y Contratas, S.A. is the Parent Company of the FCC Group and holds direct
or indirect ownership of the interests in the Group's business and activity areas. Therefore, to provide
information on the economic, financial, social and environmental events that occurred during the year and
place them in their proper context, the FCC Group's Consolidated Management Report, which includes the
consolidated Statement of Non-Financial Information, is reproduced below. The company's non-financial
information can be found in the aforementioned report.

1.1. Status of the entity: organisational structure and decision-making

process in management

The Group's organisational structure is based on a first level consisting of Areas, which are divided into
two main groups: operational and functional.

i. Environmental Services

ii. End-to-end Water Management

iii. Construction

iv. Cement Business

v. Concessions

vi. Real Estate

i. General accounting

ii. Accounting standardisation

iii. Consolidation

iv. Tax advice

v. Tax procedures

vi. Tax compliance

vii. Administrative procedures

Internal Audit and Risk Management: Its objective is to provide the Audit and Control Committee and
Senior Management with an independent and objective opinion on the Group's ability to achieve its
objectives through a systematic and methodological approach for the assessment, management and
effectiveness of internal control and risk management processes, assessing the effectiveness and
reasonableness of the internal control systems, as well as the functioning of processes according
to the procedures, proposing improvements and providing methodological support to the Division
in the process of identifying the main risks that affect activities and supervising the actions for their
management.

It is made up of the following areas: Legal Advice Department, Quality Management, Corporate
Security and General Services and Corporate Responsibility.

Each of these operating Areas is headed by one or more specialised companies which, depending on FCC,
encompass the Group's activities.

The Areas, on a second level, can be divided into Sectors, the operational ones, and Divisions, the
functional ones, establishing areas that allow greater specialisation when considered necessary.

In addition, there are the functional Areas, which carry out support tasks for the operational ones:

The structure of the main decision-making bodies is set out below:

1) Administration and Finance: the Administration and Finance Division comprises the Administration,
Taxation, Information Technologies, Finance, Communication, Purchasing and Human Resources
areas.

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 3 of 45

517

• Audit And Control Committee: its main function is to support the Board of Directors in its

supervisory duties by periodically reviewing the process for preparing economic and financial
information, its internal controls and the independence of the external auditor.

• Appointments and Remuneration Committee: supports the Board of Directors in relation to

• Managing Committee: Each of the business units has a Managing Committee with similar duties.

1.2. Status of the entity: business model and company strategy

Environmental Services

FCC Medio Ambiente has a strong presence in Spain, and has maintained a leading position in the
provision of urban environmental services for over 120 years.

The Group provides environmental services in more than 3,500 municipalities and organisations in all the
Autonomous Communities, serving a population of more than 31 million inhabitants. Waste collection and
street cleaning are two of the most important services, representing 63% of revenue. They are followed,
in order of importance, by disposal of wastes with 12%, cleaning and maintenance of buildings, parks and
gardens and, to a lesser extent, sewage. More than 85% of the activity is carried out with public clients

In turn, the international business is mainly undertaken in the UK, Central Europe and the USA. For
years, the Group has held a leading position in the United Kingdom and Central European markets in
the integrated management of municipal solid wastes, as well as in the provision of a wide range of
environmental services. The various services provided in this sector include treatment and recycling,
disposal, waste collection and the generation of renewable energy, with a growing weight and gradual
reduction of disposal in controlled landfills.

518

End-to-end Water Management

The international market reached a turnover of 38,2%. FCC Aqualia focuses its activity in Europe, North
Africa, the Middle East and the Americas, with ongoing contracts in 16 countries at present.

519

In addition, FCC Aqualia will use its extensive experience in end-to-end water cycle management for
business opportunities in countries with a stable political and social balance.

Construction

Its teams have the experience, technical training and innovation to participate in the entire project value
chain, from the definition and design, to its complete execution and subsequent operation.

or the EPC projects for the Guillena Reunión photovoltaic plants of 268MWp (Seville) and TAGUS of
380MWp (Cáceres).

Cement

It boasts a leading position both in its main market, Spain, and in the Tunisian market.

Real Estate

Increase in the holding in Realia Business S.A. by 13.56% to 67.05% at the end of 2023 (53.49% in
2022).

Increase in the holding in Metrovacesa S.A. by 7.38% to 21.21% at the end of 2023 (13.81% in 2022).

These operations are in addition to those performed over the past two years:

3. Contribution to FCC Inmobiliaria of 100% of the shares in Jezzine Uno S.L.U, a property company that

operates 405 premises intended for bank offices whose only tenant is Caixabank.

Increase of 37.11% in the holding in Hermanos Revilla S.A. (now Planigesa, S.A., following the merger)
taking the holding to 87.76%, this property company operates assets in prime areas of Madrid.

Increase in its holding in Realia Business S.A and voluntary tender offer for 24% of the shares in
Metrovacesa S.A, obtaining 11.47% of its share capital.

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 6 of 45

2. Business performance and results

2.1. Operating performance

2.1.1. Significant Events

FCC completes sale of 24.99% of the Environment parent company for €965 million

The Real Estate area reinforces its competitive position with new acquisitions

FCC Medio Ambiente consolidates its presence in the waste treatment sector in the
United Kingdom, Spain and the USA

FCC Aqualia expands its international activity and seals its entry into the US market

FCC Construcción secures an important industrial contract in Germany

In December, FCC completed the voluntary takeover bid for the amortization of its
own shares

521

4.502% of company's share capital, or 20,560,154 shares, being redeemed. As a result of this operation, the
company's share capital at the end of December 2023 stood at 436,106,917 shares.

2.1.2. Executive Summary

KEY FIGURES

Revenue

Gross operating profit (EBITDA)

EBITDA margin

Net operating profit (EBIT)

EBIT Margin

Income attributable to the parent company

Equity

Net financial debt

Backlog

Dec. 23

9,026.0

1,529.6

16.9%

910.3

10.1%

591.0

6,146.0

3,100.1

Dec. 22

7,705.7

1,311.4

17.0%

610.5

7.9%

315.2

4,939.0

3,192.7

41,620.8

40,273.8

(Millions of Euros)

Chg. (%)

17.1%

16.6%

-0.1 p.p

49.1%

2.2 p.p

87.5%

24.4%

-2.9%

3.3%

Dec. 23

Dec. 22

Chg. (%)

% s/ 23

% s/ 22

522

(Millions of Euros)

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 8 of 45

2.1.3. Summary by Business Areas

REVENUE BY GEOGRAPHICAL AREA

Spain

America

United Kingdom

Rest of Europe and Others

Czech Republic

Middle East, Africa and Australia

Total

EBITDA*

Environment

Water

Construction

Cement

Real Estate

(Millions of Euros)

Corporate serv. and others

Area

Dec. 23

Dec. 22

Chg. (%)

% s/ 23

% s/ 22

Total

1,529.6

1,311.4

REVENUE BY BUSINESS AREA

OPERATING PROFIT/(LOSS)

Environment

Water

Construction

Cement

Real Estate

Corporate serv. and others

3.853,2

1.487,4

2.823,1

614,3

253,8

(5,8)

3.641,1

1.323,2

1.966,9

516,5

270,8

(12,8)

Total

9.026,0

7.705,7

5,8%

12,4%

43,5%

18,9%

-6,3%

-54,7%

17,1%

42,7%

16,5%

31,3%

6,8%

2,8%

-0,1%

47,3%

17,2%

25,5%

6,7%

3,5%

-0,2%

Environment

Water

Construction

Cement

Real Estate

Corporate serv. and others

100,0%

Total

337.6

216.3

118.4

129.1

55.8

53.1

910.3

304.7

203.8

89.4

(203.3)

165.7

50.2

610.5

4,737.3

1,305.7

1,113.8

1,052.8

413.7

402.7

4,271.2

760.3

1,048.4

878.2

385.4

362.2

10.9%

71.7%

6.2%

19.9%

7.3%

11.2%

52.5%

14.5%

12.3%

11.7%

4.6%

4.5%

55.4%

9.9%

13.6%

11.4%

5.0%

4.7%

9,026.0

7,705.7

17.1%

100.0%

646.7

384.3

169.4

139.5

104.9

84.8

593.1

350.2

122.8

30.3

143.8

71.2

9.0%

9.7%

37.9%

n/a

-27.1%

19.1%

16.6%

10.8%

6.1%

32.4%

n/a

-66.3%

5.8%

49.1%

42.3%

25.1%

11.1%

9.1%

6.9%

5.5%

45.2%

26.7%

9.4%

2.3%

11.0%

5.4%

100.0%

37.1%

23.8%

13.0%

14.2%

6.1%

5.8%

49.9%

33.4%

14.6%

-33.3%

27.1%

8.2%

100.0%

Area

Dec. 23

Dec. 22

Chg. (%)

% s/ 23

% s/ 22

(Millions of Euros)

2.1.4. Income Statement

NET FINANCIAL DEBT*

Corporate

With recourse

Without recourse

Areas

Environment

Water

Cement

Real Estate

Total

BACKLOG*

Environment

Water

Construction

Real Estate

Total

(1,233.1)

(840.1)

74.3

87.1

1,424.7

1,665.8

131.4

1,037.0

1,227.6

1,642.8

157.6

917.7

46.8%

-14.7%

16.1%

1.4%

-16.6%

13.0%

-39.8%

2.4%

46.0%

53.7%

4.2%

33.5%

-26.3%

2.7%

38.5%

51.5%

4.9%

28.7%

3,100.1

3,192.7

-2.9%

100.0%

Revenue

Gross Operating Profit (EBITDA)

EBITDA Margin

Provision for amortisation of fixed and non-current assets

Other operating income

Net Operating Profit (EBIT)

EBIT margin

Financial income

Other financial profit/(loss)

P/L of companies accounted for by the equity method

Profit/(loss) before tax from continuing activities

13,328.4

13,255.5

21,730.7

20,312.7

6,425.9

135.8

6,586.0

119.6

41,620.8

40,273.8

0.5%

7.0%

-2.4%

13.5%

3.3%

32.0%

52.2%

15.4%

0.3%

32.9%

50.4%

16.4%

0.3%

Company tax on profits

Income from continuing operations

Net Income

Non-controlling interests

100.0%

Income attributable to the parent company

523

(Millions of Euros)

Chg. (%)

17,1%

16,6%

-0,1 p.p

14,9%

-87,6%

49,1%

2,2 p.p

25,9%

-162,2%

n/a

66,3%

135,4%

55,8%

-5,5%

87,5%

Dec. 23

9.026,0

1.529,6

Dec. 22

7.705,7

1.311,4

16,9%

(596,9)

(22,5)

910,3

10,1%

(150,0)

(18,4)

174,0

915,9

(171,1)

744,8

(153,8)

591,0

17,0%

(519,7)

(181,1)

610,5

7,9%

(119,1)

29,6

550,7

(72,7)

477,9

(162,7)

315,2

2.1.4.1. Net Revenue

* See note 10 for a definition of the calculation in accordance with ESMA Guidelines (2015/1415en).
Note: Corporate Services and others includes the Concessions activity.

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 10 of 45

524

For each of the business Areas the evolution was as follows:

Revenue breakdown by geographical area

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

Spain

America

United Kingdom

Rest of Europe and Others

Czech Republic

Middle East, Africa and Australia

4,737.3

1,305.7

1,113.8

1,052.8

413.7

402.7

4,271.2

760.3

1,048.4

878.2

385.4

362.2

Total

9,026.0

7,705.7

10.9%

71.7%

6.2%

19.9%

7.3%

11.2%

17.1%

% revenue by geographical area

4.5%

11.7%

14.5%

4.6%

Spain

United Kingdom

Rest of Europe and Others

Middle East, Africa and Australia

America

Czech Republic

12.3%

52.5%

525

2.1.4.2. Gross Operating Profit (EBITDA)

By business area, the most noteworthy developments have been:

% EBITDA by business Area

Environment

Water

Cement

Construction

Real Estate

Corporate

11.1%

6.9%

9.1%

5.5%

25.1%

42.3%

526

2.1.4.3. Net Operating Profit (EBIT)

2.1.4.4.3. Profits/(losses) of companies accounted for by the equity method

2.1.4.4. Earnings before Taxes (EBT) from continuing operations

2.1.4.5. Income attributable to the parent company

Thus, the performance was as follows for the various components:

2.1.4.4.1. Financial income

2.1.4.6. Profit and loss statement figures on a pro rata basis

The most significant figures in the income statement, calculated on the basis of the percentage of
effective shareholding in each of the subsidiaries, joint ventures and associates, are as follows.

2.1.4.4.2. Other financial profit/(loss)

Revenue

Gross Operating Profit (EBITDA)

EBITDA Margin

Net Operating Profit (EBIT)

EBIT margin

Income attributable to the parent company

Dec. 23

8,522.7

1,280.8

15.0%

762.6

8.9%

591.0

Dec. 22

7,306.0

1,098.6

15.0%

449.1

6.1%

315.2

Chg. (%)

16.7%

16.6%

0.0 p.p

69.8%

2.8 p.p

87.5%

527

2.1.5. Balance sheet

Intangible fixed and non-current assets

Property, plant and equipment

Real Estate investments

Investments accounted for using the equity method

Non-current financial assets

Deferred tax assets and other non-current assets

Non-current assets

Inventory

Trade and other receivables

Other current financial assets

Cash and cash equivalents

Current assets

TOTAL ASSETS

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

2,483.5

3,829.8

2,091.3

1,034.3

748.4

468.3

2,342.1

3,496.8

2,122.9

502.6

910.6

499.5

10,655.7

9,874.5

1,234.3

2,957.4

260.5

1,609.7

1,143.2

2,468.0

221.3

1,575.5

6,062.0

5,408.0

141.4

333.0

(31.6)

531.7

(162.2)

(31.2)

781.2

91.1

489.4

39.2

34.2

654.0

16,717.7

15,282.5

1,435.2

Equity attributable to shareholders of the parent company

Non-controlling interests

Equity

Subsidies

Non-current provisions

Long-term financial debt

Other non-current financial liabilities

Deferred tax liabilities and other non-current liabilities

Non-current liabilities

Current provisions

Short-term financial debt

Other current financial liabilities

Trade and other payables

Current liabilities

TOTAL LIABILITIES

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

4,450.1

1,695.9

6,146.0

226.6

1,230.6

4,361.0

456.0

434.1

3,387.9

1,551.1

4,939.0

202.9

1,141.7

3,860.7

410.6

430.7

6,708.3

6,046.6

159.6

604.1

322.7

2,777.0

148.1

1,121.8

211.3

2,815.7

1,062.2

144.8

1,207

23.7

88.9

500.3

45.4

3.4

661.7

11.5

(517.7)

111.4

(38.7)

3,863.4

4,296.9

(433.5)

16,717.7

15,282.5

1,435.2

2.1.5.1. Property, plant and equipment, intangible assets and real estate investments

528

2.1.5.2. Investments accounted for using the equity method

2.1.5.5. Equity

The heading of investments accounted for by the equity method amounts to 1,034.3 million euros at the
end of the year, 531.7 million more than at the end of the previous year. This increase can be attributed,
firstly, to the accounting reclassification of the holding in Metrovacesa in the Real Estate area from
financial investment to investment accounted for by the equity method, given its significant influence, and
secondly, to the increase in capital of an associate in the Cement area, which operates in the USA. The
breakdown of the most relevant investments at year-end is as follows:

Equity at the end of the period came to €6,145.9 million, compared to €4,939 million the previous year. This
increase can largely be attributed to the contribution of net income achieved in the period and in particular
the increase in reserves and non-controlling interests due to the sale of a non-controlling interest in the
Environmental Area for the combined amount of €953.8 million. In the opposite direction, the impact of the
reduction in capital following the buyback of own shares for their subsequent redemption for the sum of
€257 million is also worth particular mention.

1) 233.2 million euros for the stake in companies in the Environment area (recycling and municipal

services, mainly in Spain and the United Kingdom).

2.1.5.6. Financial debt

2) 123.0 million euros for the stake in transport and public infrastructure concessions, mainly in Spain,

Peru and the United Kingdom.

3) 67.6 million euros for stakes held in companies in the Water area, largely concessionary companies

that manage services abroad (North Africa, Spain and Mexico).

4) 132.4 million euros from the subsidiaries of the parent company in the Cement area.

5) 442.0 million euros from investee companies in the Real Estate area.

6) 36.1 million euros in investees in the Construction area located abroad.

2.1.5.3. Non-current financial assets

2.1.5.4. Cash and cash equivalents

In the perimeter with recourse, cash and equivalents totalled 818.3 million euros.

In the perimeter without recourse, cash and equivalents amounted to 791.4 million euros.

Bank borrowings

Debt instruments and other loans

Finance lease payables

Other financial liabilities

Gross Financial Debt

Treasury and other current financial assets

Net Financial Debt

Net financial debt with recourse

Net financial debt without recourse

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (M€)

2,710.0

2,107.0

14.0

134.1

2,778.4

2,040.8

24.9

138.4

4,965.1

4,982.5

(1,865.0)

(1,789.8)

3,100.1

3,192.7

(68.4)

66.2

(10.9)

(4.3)

(17.4)

(75.2)

(92.6)

(901.7)

(677.2)

(224.5)

4,001.8

3,869.9

131.9

Breakdown of Net Financial Debt without recourse by Business Area

2.1.6. Cash Flow

529

Environment

Water

Cement

Corporate

Real Estate

1.8%

23.9%

32.9%

3.0%

38.4%

Investment cash flow

Interest paid

Net financial debt without recourse to the Group's parent company is structured as follows:

2.1.5.7. Other current and non-current financial liabilities

Gross Operating Profit (EBITDA)

1,529.6

1,311.4

16.6%

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

(Increase)/decrease in working capital

Corporation tax (paid)/received

Other operating cash flow

Operating cash flow

Investment payments

Divestment receipts

Other investment cash flows

(Payment)/receipt of financial liabilities

Other financing cash flow

Financing cash flow

Exchange differences, change in consolidation scope, etc.

Increase/(decrease) in cash and cash equivalents

2.1.6.1. Operating cash flow

(691.4)

(124.2)

71.4

285.3

0.7

(51.6)

n/a

785.4

1,545.8

-49.2%

(1,104.6)

(1,062.1)

36.2

106.0

51.5

72.6

(962.4)

(938.0)

4.0%

-29.7%

46.0%

2.6%

39.5%

-65.9%

n/a

(123.7)

(333.9)

(109.6)

(567.2)

-137.1%

(0.6)

n/a

40.0

-14.5%

(172.5)

(113.8)

496.6

210.3

1.0

34.2

Fomento de Construcciones y Contratas, S.A. | Management Report | Page 16 of 45

530

2.1.6.2. Investment cash flow

The breakdown of net investments by business area, excluding other cash flows from investment
activities, in terms of payments and collections, is as follows:

2.1.6.4 Change in cash and cash equivalents

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

2.1.7. Analysis by business area

Environment

Water

Construction

Cement

Real Estate

Corporate serv., others & adjustments

(531.8)

(241.6)

(47.1)

(129.7)

(109.7)

(8.5)

(407.5)

(362.9)

(21.4)

(22.2)

(154.4)

(42.2)

(124.3)

121.3

(25.7)

(107.5)

44.7

33.7

Net investments (Payments - Collections)

(1,068.4)

(1,010.6)

(57.8)

2.1.6.3. Financing cash flow

2.1.7.1. Environment

In Spain it provides services in more than 3,700 municipalities and serves a population of more than 32
million inhabitants. It is worth mentioning the important weight of the urban waste management and
street cleaning services. In the UK, it focuses on urban waste treatment, recovery and disposal activities
and serves more than 16 million people. In central Europe, mainly Austria and the Czech Republic, it is
present throughout the entire waste management chain (collection, treatment and disposal). The activity
in the US is carried out both in the collection and in the comprehensive recovery of urban waste and serves
more than 11 million inhabitants. The Environment activities within the FCC Group have over 120 years of
experience and service over 66 million inhabitants over 5,200 municipalities in the world.

531

2.1.7.1.1. Earnings

Turnover

Waste collection and street cleaning

Waste processing

Other services

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

3,853.2

1,938.6

1,142.6

772.0

646.7

16.8%

337.6

8.8%

3,641.1

1,765.0

1,130.1

746.0

593.1

16.3%

304.7

8.4%

5.8%

9.8%

1.1%

3.5%

9.0%

0.5 p.p

10.8%

0.4 p.p

Breakdown of revenue by geographical area

Spain

United Kingdom

Central Europe

15.8%

20.2%

9.9%

Breakdown of revenue by geographical area

(Millions of Euros)

USA and Others

Dec. 23

Dec. 22

Chg. (%)

54.1%

Spain

United Kingdom

Central Europe

United States and other

Total

2,086.3

1,975.2

778.7

607.0

381.2

794.9

592.2

278.8

3,853.2

3,641.1

5.6%

-2.0%

2.5%

36.7%

5.8%

Breakdown of backlog by geographical area

(Millions of Euros)

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

8,390.6

4,937.8

8,224.1

5,031.4

13,328.4

13,255.5

2.0%

-1.9%

0.5%

532

2.1.7.2.1. Earnings

Turnover

Cycle Management and Services

Technology and Networks

EBITDA

EBITDA Margin

EBIT

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

1,487.4

1,343.7

143.7

384.3

25.8%

216.3

14.5%

1,323.2

1,212.2

111.0

350.2

26.5%

203.8

15.4%

12.4%

10.8%

29.5%

9.7%

-0.7 p.p

6.1%

-0.9 p.p

2.1.7.1.2. Financial Debta

Net Financial Debt

(Millions of Euros)

EBIT margin

Dec. 23

Dec. 22

Chg. (Mn€)

1,424.7

1,227.6

197.1

Breakdown of revenue by geographical area

(Millions of Euros)

2.1.7.2. Water

Spain

Central and Eastern Europe

Middle East, Africa and Other

Rest of Europe (France, Portugal and Italy)

Latin America

Total

Dec. 23

Dec. 22

Chg. (%)

919.2

232.7

134.6

109.5

91.4

861.4

190.0

131.1

92.3

48.4

1,487.4

1,323.2

6.7%

22.5%

2.7%

18.6%

88.8%

12.4%

533

Breakdown of revenue by geographical area

Spain

Middle East, Africa and Others

Central Europe

Latin America

Rest of Europe

61.8%

15.7%

9.0%9.0%

6.1%

7.4%

Breakdown of backlog by geographical area

(Millions of Euros)

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

6,860.6

7,049.2

14,870.1

13,263.5

21,730.7

20,312.7

-2.7%

12.1%

7.0%

2.1.7.2.2. Financial Debt

Net Financial Debt

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

1,665.8

1,642.8

23.0

534

2.1.7.3. Construction

Turnover

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

2,823.1

169.4

6.0%

118.4

4.2%

1,966.9

122.8

6.2%

89.4

4.5%

43.5%

37.9%

-0.2 p.p

32.4%

-0.3 p.p

Breakdown of revenue by geographical area

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

Spain

America

Rest of Europe

Middle East, Africa, Australia and Others

1,108.1

819.3

695.1

200.6

870.1

434.3

500.5

162.0

Total

2,823.1

1,966.9

27.4%

88.6%

38.9%

23.8%

43.5%

By geographical area, turnover in Spain increased by 27.4% to €1,108.1 million, on account of the faster
than expected progress on ongoing projects, mainly in the public sphere.

Breakdown of revenue by geographical area

Spain

Middle East, Africa,
Australia and Others

Rest of Europe

America

7.1%

39.3%

24.6%

29.0%

Breakdown of backlog by geographical area

(Millions of Euros)

2.1.7.4.1. Earnings

Spain

International

Total

Dec. 23

Dec. 22

Chg. (%)

2,386.1

4,039.8

1,817.3

4,768.7

6,425.9

6,586.0

31.3%

-15.3%

-2.4%

Turnover

Cement

Other

EBITDA

EBITDA Margin

EBIT

EBIT margin

535

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

614.3

563.6

50.7

139.5

22.7%

129.1

21.0%

516.5

474.1

42.4

30.3

5.9%

(203.3)

-39.4%

18.9%

19.6%

n/a

16.8 p.p

n/a

60.4 p,p

Breakdown of the Backlog by Activity Segment

(Millions of Euros)

The area's revenue grew by 18.9% year-on-year to €614.3 million, following an increase in prices, mainly in
Spain, in addition to an increase in exports from the same region.

Breakdown of revenue by geographical area

(Millions of Euros)

Civil engineering works

Building

Industrial Projects

Total

Dec. 23

Dec. 22

Chg. (%)

5,112.4

5,569.7

656.9

656.6

503.9

512.4

6,425.9

6,586.0

-8.2%

30.4%

28.1%

-2.4%

Spain

Tunisia

Miscellaneous (exports)

Total

Dec. 23

Dec. 22

Chg. (%)

380.9

62.2

171.2

614.3

314.6

62.6

139.3

516.5

21.1%

-0.6%

22.9%

18.9%

2.1.7.4. Cement

By geographical area, in Spain, turnover increased by 21.1% to €380.9 million on account of the significant
sustained increase in prices combined with unchanged volumes.

Breakdown of revenue by geographical area

Spain

Tunisia

Other

27.9%

10.1%

62.0%

536

2.1.7.5. Real Estate

2.1.7.5.1. Earnings

Turnover

Development and land

Rental Property

EBITDA

EBITDA Margin

EBIT

EBIT margin

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (%)

253.8

138.0

115.8

104.9

41.3%

55.8

22.0%

270.8

165.0

105.8

143.8

53.1%

165.7

61.2%

-6.3%

-16.4%

9.5%

-27.1%

-11.8 p.p

-66.3%

-39.2 p.p

2.1.7.4.2. Financial Debt

Net financial debt

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

131.4

157.6

(26.2)

GAV by Activity (not including Metrovacesa)

Property

Development

73.6%

26.4%

537

Property

Residential Development

16%

79%

Offices

Retail

Others

2.1.7.5.2. Financial Debt

Net financial debt

35%

46%

18%

Planning and Others

Land for Development

Finalist

In progress and completed

(Millions of Euros)

Dec. 23

Dec. 22

Chg. (Mn€)

1,037.0

917.7

119.3

538

2.2. Business performance. Environment

2.3. Business performance. Personnel

Attached is a breakdown of the Group's headcount at the end of the year, by business area:

AREAS

2023

• Continuous improvement: Promote environmental excellence by establishing objectives for the

continuous improvement of performance, minimising the negative impacts of the Group's processes,
products and services, and enhancing the positive impacts on its areas of activity.

• Climate change and pollution prevention: Lead the fight against climate change through the

Environment

Water Management

Construction

Cement

Real Estate

Central Services and Others

Spain

Abroad

Total

%s/Total

36,152

6,971

4,115

865

388

8,279

6,793

3,150

212

44,431

13,764

7,265

1,077

457

66%

21%

11%

TOTAL

48,587

18,503

67,090

100%

3. liquidity and capital resources

Liquidity

In order to optimise its financial position, the Group maintains a proactive liquidity management policy with
daily cash monitoring and forecasts.

The Group covers its liquidity needs through the cash flows generated by the businesses and through the
financial agreements reached.

• Life cycle of products and services: enhancing environmental considerations in business planning,

procurement of materials and equipment, and relations with suppliers and contractors.

In order to improve the Group's liquidity position, active collection management is carried out with
customers to ensure that they meet their payment commitments.

• The necessary participation of all parties: promote the knowledge and application of environmental

Note 29 to the consolidated financial statements sets forth the policy implemented by the Group to
manage liquidity risk and the factors mitigating said risk.

539

Capital resources

The performance of interest rates in recent years is shown below.

The Group manages its capital to ensure that its member companies will be able to continue as profitable
and solvent businesses.

As part of its capital management operations, the Group obtains financing through a wide range of
financial products.

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

-1.00%

Dec18

Dec19 Mar20 Jun20

Sep20 Dec20 Mar21 Jun21 Sep21

Dec21 Jan22 Mar22 Jun22 Sep22

Dec22 Jan23 Feb23 Mar23 Apr23 May23 Jun23 Jul23 Aug23 Sp23 Ocy23 Nov23 Dec23

EURIB 6M

GBP-LIBOR 6M

USD-LIBOR 6M

SOFR

SONIA

This section is discussed in greater detail in note 29 to the consolidated financial statements.

540

4. Major risks and uncertainties

4.2. Major risks and uncertainties

4.1. Risk Management Policy and System

5. Acquisition and disposal of own shares

The treasury stock position at 31 December was 44,957 shares.

The acquisition and disposal of treasury shares carried out during the year are disclosed in Note 17 of the
Notes to the consolidated financial statements.

541

6. Significant events occurring after the
end of the year

7. Outlook

The outlook for the performance of the Group's main business Areas in 2023 is given below.

In Spain, moderate growth is expected based on the implementation of new contracts, competing in all
tenders that may be of interest due to their strategy and/or attractiveness.

In relation to waste treatment, the opportunities that may be generated by the new Waste Master Plans of
the different regional governments will be harnessed.

542

2.2.1. Europe

2.2.2. USA

In Portugal, business opportunities related to processing industrial waste and the disposal of municipal
waste is worth particular mention.

Consideration shall be given to any growth opportunities (including inorganic growth), especially if they can
add value to the Group.

Water

The high rates of contract renewal that Aqualia has historically recorded on maturity (over 90%) are
expected to be maintained.

It is also considered that many towns managed by Aqualia will adapt their tariffs or the company's
remuneration, to reflect the effect of the CPI increase during 2022-2023.

543

544

Construction

In the international market, FCC focuses on countries and markets with a stable presence and on the
execution of projects with guaranteed financing.

Taking into account the above, it is estimated that in 2024, the turnover obtained in Spain will remain
similar to that obtained in 2023.

Real Estate

FCC Inmobiliaria's actions for 2024 will focus on the development of its three business lines exclusively in
Spain:

Cement

Office, premises and shopping centre rentals

The main notes in this line of business include:

• Business backed by the quality of the assets where most of the offices are located in prime areas, and

also the group of shopping centres it owns, which are centres located in the shopping areas of the cities.

• Recurrence of revenues from Jezzine, the lessor of Caixabank's offices, whose lease expires in 2037.

545

Real-estate development and land management

8. R&D+I Activities

During the course of 2024, the real-estate area will keep development activity at similar levels to last year,
with the completion of projects in progress, as well as the start of new projects, with special attention
to their profitability, and also to the viability of their commercialisation, bearing in mind the evolution of
demand and the macro scenario of the Spanish economy, which are vital for development activities.

Rental housing

In addition, operations have continued at the “Jardín de Tres Cantos” residential building with 85 homes,
100% of which are rented.

The total investment made in the three Build to Rent projects, with a total of 280 homes, amounted to
€59.5 M.

The FCC Group's R&D&I activities in 2023 have resulted in more than 35 projects.

These projects seek to respond to the challenges of each business area while maintaining overall
coordination between the different business Areas of the FCC Group.

The activities of the different Business Areas and the main projects developed throughout 2023 are
detailed below.

Services

In the environmental services activity, we have continued with the development of projects started in
previous years, such as:

VISION

INSECTUM

DEEP PURPLE

PLASMIX

H2TRUCK

BICISENDAS

B-FERTS

SCALIBUR

LIFE 4 FILM

ECO2D4.0

LANDFILL BIOFUEL

SEALING OF MINING DEPOSITS

MINETHIC

ECLOSION

IRRIGATION AND WASHING TANK PV4INK

In addition, new ones have been launched during 2023, which are summarised below:

546

In the field of waste management we have 5 new projects:

There is another new project in Industrial Waste activity:

• ABATE: consists of the use of compact, high-performance marketable technologies for the reduction of

VOCs in EU waste treatment plants, reducing CO2 emissions and energy consumption.

• LUCRA: this project aims to demonstrate biotechnical and green processes for the production of:

• MPB DEHESAS: project aimed at investigating the digestion of leachate treatment plants, specifically

leachate (i) post bio-methanization, (ii) FORS and (iii) compost.

• LIFE ZEROLANDFILLING: the aim of the project is to deploy and demonstrate, in a pioneering way and at
a semi-industrial scale, the profitability and sustainability of an innovative advanced and integrated pilot
plant to allow the treatment and chemical recycling of non-recyclable MSW that normally reaches the
landfill, revaluing it as: (i) a liquid mixture of high quality hydrocarbons known as green naphtha for the
chemical and petrochemical industries; (ii) solid charcoal for the construction industry; and (iii) synthesis
gas for self-consumption during the pyrolysis process.

In the field of specialised machinery for waste collection activities there is a new project:

• CNG SIDE LOADING BODY FOR WASHING CONTAINERS: consists of developing a new side loading

End-to-end water management

The projects highlighted in 2023 are listed below:

• LIFE ULISES: it aims to transform conventional WWTPs into “energy and biofertiliser production

547