Mota-Engil — Earnings Release 2019

Aug 29, 2019

1H 2019

Earnings Release

A World of Inspiration

29th August 2019

01 Key Highlights

Page 3

02 Results Overview

Page 5

03 Regional Segments

Page 14

Europe Africa Latin America

04 Final Remarks

Page 21

05 Appendix

Page 23

KEY HIGHLIGHTS

Europe Africa Latin America

02 Results Overview

Page 5

5

Earnings Release 2018

Turnover up 7% YoY to €1,344 mn

P&L (€ mn)

	1H19	1H18	YoY
Turnover	1,344	1,251	7%
EBITDA	194	176	10%
Margin	14%	14%	0 p.p.
EBIT	91	90	1%
Margin	7%	7%	(0 p.p.)
Net financial results	(52)	(10)	n.m.
Associates	1	2	(24%)
Net monetary position1	-	(9)	n.m.
EBT	40	73	(45%)
Net income	26	41	(38%)
Attributable to:
Non-controlling interests	17	35	(51%)
Group	8	6	42%

• Turnover was fueled by a strong activity in Africa
• EBITDA was up 10% YoY to €194 mn driven by the growth both in Africa and in Latin America
• IFRS 16 impact in EBITDA was c.€7 mn
• Financial debt interest costs remained broadly stable
• Non-controlling interests are mainly related to Angola and Mexico
• Net income was up 42% YoY to €8 mn

1The caption "Net monetary position" reflects partially the accounting of Angola as a hyperinflationary economy (IAS 29) in the 1H18. After January 1, 2019 the Group discontinued the application of IAS 29 to its affiliates located in Angola.

EBITDA margin of 14%

Earnings Release 2018

P&L breakdown (€ mn)

	1H19	1H18	YoY
Turnover	1,344	1,251	7%
Europe	407	406	0%
Africa	453	362	25%
Latin America	457	486	(6%)
Other and intercompany	1 28	(3)	n.m.
EBITDA	194	176	10%
Margin	14%	14%	0 p.p.
Europe	41	47	(13%)
Margin	10%	12%	(2 p.p.)
Africa	91	82	11%
Margin	20%	23%	(3 p.p.)
Latin America	59	42	39%
Margin	13%	9%	4 p.p.
Other and intercompany	3	5	(47%)

• Turnover in Europe reflected a recovery in the E&C activity in Portugal
• Africa's turnover was up 25% YoY as Mozambique showed a very strong growth alongside with new western and eastern markets
• Angola showed a reasonable growth in the 1H19, but its activity will accelerate going forward with a speed up of backlog execution
• Africa's EBITDA margin reached 20% with balanced contribution from all markets
• In Latin America, despite the political changes, the region maintained a comfortable top line with a better operating margin

Backlog of €5.2 bn

• The E&C activity represents 87% of the total backlog with a backlog to sales2 ratio of 1.9x
• Africa continues to account for the majority of the backlog reaching €2,648 mn
• Good commercial perspectives for 2019, namely in the main markets such as Portugal, Mozambique, Brazil and Colombia

Earnings Release 2018

Major construction projects currently in backlog

Project 1	Range (€ mn)	Country	Segment	Exp. Year of Completion
Vale Mining Moatize	> 250	Mozambique	Mining	2022
Gran Canal highway	> 250	Mexico	Roads	2020
Classes: G1 Caribbean; G2 Eje Cafetero - Pacific; G3 Antioquia - Eje Cafetero - Pacific	> 250	Colombia	Civil Construction	2020
Requalification of the Soyo Naval Base	> 250	Angola	Ports	2021
Las Bambas dam (phase 4 under execution)	[200;250]	Peru	Power	2020
Cardel-Poza Rica highway	[200;250]	Mexico	Roads	2020
Tuxpan-Tampico highway	[200;250]	Mexico	Roads	2020
BR-381 highway dualisation (section 3.1 and section 7)	[200;250]	Brazil	Roads	2020
Siguiri gold mine	[150;200[	Guinea Conakry	Mining	2022
General Hospital of Cabinda	[100;150[	Angola	Civil Construction	2020
Capacity Improvement Kampala Northern Bypass	[100;150[	Uganda	Roads	2022
Offshore platform - operational unit Rio Section B	[100;150[	Brazil	Oil&Gas	2022

Total capex of €107 mn

Earnings Release 2018

• The E&S capex was mainly driven by: (i) the Energy business in Mexico (€38 mn) due to the development of Jorge Luque first phase (Gas Power Plant) and the construction works of Bordo Poniente landfill; (ii) the waste activity in Ivory Coast (€14 mn) and the E&S activity in Europe (€22 mn)
• Growth and long term contracts capex accounted for 63% of the total capex
• Guidance of capex in the high end of the range of €150 mn-€180 mn

¹¹¹ 1H19 1H18

1Includes mining contractsin Africa and the Energy business in Latin America.

Earnings Release 2018

Working capital to Turnover ratio of 9%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

Working capital evolution

• Working capital increased to €251 mn impacted by the E&C seasonality and increased activity in Africa, where Mota-Engil's operations are fully vertically integrated with very low level of subcontracting
• Working capital/Turnover ratio stood at a comfortable level

125

225

325

425

525

Solid CFFO of €127 mn

Earnings Release 2018

Free cash flow (€ mn)

CFFO €127 mn

1Net debt considers Angola's sovereign bonds denominated in US\$ and US\$ linked as "cash and cash equivalents" which amounted to €160 mn (€176 mn nominal value) in June 2019, €152 mn in December 2018 and €150 mn in June 2018 and Malawi's sovereign bonds that amounted to €14 mn in December 2018.

Earnings Release 2018

• Leasing operations, including the impact of IFRS 16 (€34 mn), amounted to €271 mn
• Liquidity position corresponds to 1.1x of non-revolving financing needs with maturity less than one year
• Monetisation of Malawian bonds (€14 mn 1H19) and Angolan bonds (€7 mn July 2019)
• New 5 year maturity €100 mn loan from pan-African multilateral Afreximbank during 1H19
• Club Deal amounting to €105 mn was closed after June 30

Gross debt maturity2, June 2019 (€ mn) Cost of debt and gearing3

1Excluding leasing and factoring amounting to €271 mn and €119 mn, respectively, and including €160 mn (€176 mn nominal value) of Angolan sovereign bonds; 2Excluding leasing and factoring; 3Net debt/EBITDA.

12

Page 14

Europe Africa Latin America

Activity to be driven by recovery in Europe

Tua's hydropower plant construction works, Portugal

• Portugal with relevant infrastructures projects in the transport (airport, railway and metro) and healthcare (hospitals) segments with European Union funds committed
• Some of those are projects expected to be awarded during this year (e.g. Porto light rail and Lisbon Central Hospital)
• Despite the 1H19 performance of the E&S activity, mid-long term perspectives are positive (changes in the regulation of the portuguese waste treatment concession sector was already published)
• Top line in Ireland increased 102% YoY in 1H19
• Guidance FY2019: Turnover up low single digit with stable profitability

Good momentum continues in Africa

Waste collection, Ivory Coast

• Growth driven by long-term mining contracts in Mozambique with Vale and in Guinea Conakry with Ashanti Gold, as well as, by the new Western and Eastern African markets
• 2019 is the first full year of activity of the waste contract operation in Ivory Coast (seven year contract worth c. €300 mn)
• Good mid term perspectives for several projects in the context of the LNG projects in Mozambique (estimated global capex of US\$50 bn for the period 2022-20251 )
• Guidance FY2019: double digit turnover growth with EBITDA margin of c.20%

Consolidation of a regional player

Coatzacoalcos-Villahermosa highway, Mexico

• Backlog as of June 2019 was recently reinforced by project awards in Panama and Brazil in E&C and E&S
• Awards are expected to take place in several countries of the region
• Mexico activity to be driven by the E&C works related to the Tourism project Costa Canuva
• Empresa Construtora Brasil (ECB) was considered the 6th largest construction company in Brazil, according to a local press ranking published in July 2019
• Guidance FY2019: Turnover of c.€1 bn with stable EBITDA margin

04 Final Remarks

Page 21

Final remarks

• Top line reachs 7% growth YoY with expectations to maintain such pace in the 2H19
• Net income increased 42% YoY
• Stable gearing at 2.5x
• Organic cash flow generation with focus in capex related to long-term projects with recurring cash conversion
• CFFO improved 26% YoY to €127 mn
• Financial strategy focused in strengthen the capital structure and goal to continue extending debt maturities and financing sources diversification

05 Appendix

Page 23

Balance sheet

Earnings Release 2018

Balance sheet (€ mn)

	Jun.19	Dec.18	Jun.19 - Dec.18
Fixed assets	1,300	1,296	5
Financial investments	300	290	10
Long term receivables	122	117	4
Non-current assets held for sale (net)	85	90	(6)
Working capital	251	199	52
	2,057	1,992	65
Equity	418	447	(29)
Provisions	98	104	(6)
Long term payables	474	486	(12)
Net debt 1	1,067	955	112
	2,057	1,992	65

Earnings Release 2018

Europe performance breakdown

Key financials (€ mn)

	1H19	1H18	YoY
Turnover	407	406	0%
E&C	284	266	7%
E&S	127	145	(12%)
Other, elim. and interc.	(4)	(5)	24%
EBITDA	41	47	(13%)
Margin	10%	12%	(2 p.p.)
E&C	10	1	(1,063%)
Margin	4%	0%	4 p.p.
E&S	29	46	(37%)
Margin	23%	32%	(9 p.p.)
Other, elim. and interc.	1	-	-

Disclaimer

Earnings Release 2018

This presentation used sources deemed credible and reliable but is not guaranteed as to accuracy or completeness. It also contains forward looking information that expresses management's best assessments but might prove inaccurate. The information contained in this presentation is subject to many factors and uncertainties and therefore subject to change without notice. The company declines any responsibility to update, revise or correct any of the information hereby contained. This presentation does not constitute an offer or invitation to purchase securities of Mota-Engil nor any of its subsidiaries.

The financial information presented in this document is non-audited.

PEDRO ARRAIS Director, Head of Investor Relations pedro.arrais@mota-engil.pt

MARIA ANUNCIAÇÃO BORREGA Investor Relations Officer maria.borrega@mota-engil.pt

investor.relations@mota-engil.pt

Rua de Mário Dionísio, 2 2796-957 Linda-A-Velha Portugal Tel. +351-21-415-8671

www.mota-engil.com

www.youtube.com/motaengilsgps