Mota-Engil — Investor Presentation 2016

Oct 13, 2016

Group's Vision, Mission and Values

VISION

To be an international reference in the infrastructure value chain, in line with the best market practices in productivity, with permanent innovation, assuming a strong identity, recognized in technical skills by providing a service of excellence to its clients and to the community.

Group's Vision, Mission and Values

MISSION

To create shareholder value respecting the community and the future, in a socially responsible way.

Group's Vision, Mission and Values

VALUES

Ambition, Integrity, Cohesion, and Group Spirit.

The strategic concept is developed around three pillars, a regional balance, and is based on five critical goals.

Strategic concept

ME Group's strategic pillars for 2020 horizon

SUSTAINABLE GROWTH

ME GROUP'S VISION 2020

CASH-FLOW GENERATION

"GLOBAL COMPANY SPECIALIZED IN INFRASTRUCTURE, FOCUSED ON CREATING VALUE AND SUSTAINABILITY"

• Greater selectivity of projects – profitability and cash-flow;
• Rotation and monetization of portfolio assets's;
• Capex and Working Capital optimization;
• Divestment of non-strategic assets.

ORGANIZATIONAL STRENGTHENING

ME Group's strategic pillars for 2020 horizon

SUSTAINABLE GROWTH

• New infrastructure value chains (recurrence);
• Focus on current strategic markets;
• Focus on projects with scale and higher profitability;
• Focus on businesses of services to the community (waste and energy).

SUSTAINABLE GROWTH

"GLOBAL COMPANY SPECIALIZED IN INFRASTRUCTURE, FOCUSED ON CREATING VALUE AND SUSTAINABILITY"

ORGANIZATIONAL STRENGTHENING

ME Group's strategic pillars for 2020 horizon

CONTROLLED RISK

• Regional balance;
• Balancing business portfolio risk;
• Diversification of the client and supplier base;
• Funding sources diversification;
• Balance among the geographical markets in each Region;
• Focus on risk assessment and on risk management.

SUSTAINABLE GROWTH

"GLOBAL COMPANY SPECIALIZED IN INFRASTRUCTURE, FOCUSED ON CREATING VALUE AND SUSTAINABILITY"

ORGANIZATIONAL STRENGTHENING

The size and global nature of the Group require the implementation of an organizational model that is standardized, efficient, and known by the entire Group, in order to improve the perception of the Group as a true multinational, thereby facilitating communication, processes, and mobility among markets and regions.

Organizational Strengthening

The repositioning as a global company specialized in infrastructure will require the Group to expand in the life cycle and to other value chains. DE INFRAESTRUTURAS

Expansion in the infrastructure value chains

EXPAND THE CONSTRUCTION BUSINESS TO OTHER INFRASTRUCTURES AND CIVIL CONSTRUCTION SECTORS

DEVELOP THE ENERGY BUSINESS ACCORDING TO LIFE CYCLE OF SUCH INFRASTRUCTURES

LEVERAGE THE KNOW-HOW OBTAINED FROM THE ACQUISITION OF EGF (WASTE TREATMENT), IN THE MARKETS WHERE WE ARE PRESENT

FOSTER THE EXPERIENCE OBTAINED FROM STRUCTURING AND SETTING UP CONCESSIONAL PROJECTS, EXTENDING IT TO ALL KINDS OF INFRASTRUCTURE

MARKET

• Reinforcement of current partnerships:
• Angola [Sonangol, BPA, Finicapital and Globalpactum – 49%];
• Brazil [Bonsucesso – 49,99%];
• Mexico [Prodi 49%];
• Development of partnerships in new markets.

BUSINESS

• Establishment of partnerships to allow expansion in the value chain of infrastructure;

• Maintenance of current partnerships with business.

municipalities in the waste

Development and strenghthening of strategic partnerships

Focus on building stable partnerships.

FINANCE

• Establishment of new partnerships to develop concessions projects, as the one established with Novo Banco in the past;
• Reinforcement the relationship with global banks in order to support the Group globally.

Strategic drivers according to region

Strategic drivers according to region

INCREASE EFFICIENCY BY IMPROVING PROCESSES, USE OF TECHNOLOGY AND INNOVATION, CULTURE OF ACCOUNTABILITY, ORGANIC GROWTH, AND RISK MANAGEMENT

HIGHER EXPOSURE TO CLIENTS WITH HIGHER RECURRENCE AND THAT ARE LESS EXPOSED TO THE EMERGING MARKET'S USUAL VOLATILITY

EXPANSION IN THE VALUE CHAIN, GROWING FROM CONTRACTOR TO SOLUTIONS PROVIDER

DEVELOP SKILLS TO EXECUTE LARGE-CAPITAL PROJECTS

DEVELOP AND TRAIN

KEY LOCAL STAFF

Strategic drivers according to region

The financial strategy for the 2015-2020 period is supported by five pillars:

Financial strategy

EFFICIENT CAPITAL ALLOCATION

CAPEX RATIONALIZATION AND WORKING CAPITAL OPTIMIZATION

FOSTERING LONG-TERM FINANCIAL PARTNERSHIPS

PROACTIVE DIVERSIFICATION OF FUNDING SOURCES

LOCAL FUNDING FOR TREASURY AND LIQUIDITY MANAGEMENT

Four strategic axes that should support the development of organizational culture and of human resources, to deal with the main Group challenges.

Organizational culture and human resources

STRATEGIC AXES

DEVELOPMENT AND TRANSVERSALITY OF SKILLS

GLOBAL STAFF MOBILITY

MERIT CULTURE

REINFORCEMENT OF CULTURE AND ORGANIZATIONAL MODEL

GENERATING OPPORTUNITIES

Focus on organic cash-flow generation (FCF):

• Accumulated FCF for the period 2016-2020 > 1 bi €;
• Accumulated FCF to equity (1) for the period 2016-2020 > 450 M€.

Additionally, it should be added the inflow of the disposals of Tertir, Indaqua, Ascendi and some real estate assets, in an amount higher than 500 M€.

Focus on nominal net debt reduction:

• Reinforcement of capital structure;
• In 2020, net debt tentatively should only finance:
• working capital, notwithstanding it should be lower in nominal terms;
• non construction business;
• equity stakes in infrastructures concessions.

Expansion in the infrastructure value chains will keep the profitability as "Best in class":

• Maintenance of EBITDA margins of c. 15%;
• EBITDA in line with historical margins;
• Optimization of the organizational structure in order to reduce overheads to 3% of turnover;
• Improvement in net margin to 3%.

Turnover increase to 4 bi€

Assumptions:

• African countries economic recovery;
• Commodities price increase;
• Maintenance of international financial entities appetite to finance relevant projects in Africa and Latin America, through equity or debt;
• Turnover growth with decreasing working capital;
• Promote at least 2 markets in each region, which represent 60% of regional turnover.

The Group's homogeneous growth objective, balanced among the three regions where it is present, as a way to manage the risk and have sustainable growth.

Turnover and EBITDA

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.

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www.mota-engil.com

AFRICA

ANGOLA

Rua Joaquim Cordeiro da Mata, nº 61-63 Bairro da Maianga Luanda Angola

MALAWI

Nasra House – City Centre P.O. Box 31379 – Lilongwe 3 Malawi

MOZAMBIQUE

Edifício Milenium Park, 14º / 15º andar Avenida Vladimir Lenine, nº 179 2284 Maputo Mozambique

SOUTH AFRICA

Oxford Corner 6th, 7th and 8th Floor 32A Jellicoe Avenue West Rosebank Johannesburg 2196 South Africa

CAPE VERDE

Rua S. Vicente, 63, 1º andar, Palmarejo 721 – Plateau – Praia Cape Verde

SÃO TOMÉ AND PRÍNCIPE

Av. Marginal 12 de Julho, nº 1011 – CP 167 São Tomé e Príncipe

ZAMBIA

Incito Office Park Reed Buck Road, 45 / 5B Kabulonga – Lusaka P.O. Box 320337 Woodlands – Lusaka Zambia

ZIMBABWE

7, Routledge Street,Milton Park, Harare Zimbabwe

UGANDA

4, Upper Kololo Terrace P.O. Box 8453 Kololo, Kampala Uganda

RWANDA

Kigali City Tower Plot no. 6418 15th Floor, Avenue du Commerce, Office 1507 Kigali Rwanda

PERU

Av. Nicolás Ayllón, nº 2634 Ate, Lima 3 Peru

MEXICO

Horacio 828 esq. Tennyson Col. Polanco Reforma C.P. 11550 Del. Miguel Hidalgo Mexico, D.F.

BRAZIL

Rua Gonçalves Dias, 2316 Bairro Lourdes – Belo Horizonte/MG CEP.: 30140-092 Brazil

COLOMBIA

Carrera 13A-87-81 38007 Bogotá Colombia

CHILE

Avenida Vitacura 2736 Oficina 504 Las Condes, Región Metropolitana, Santiago de Chile Código postal 7550000 Chile

DOMINICAN REPUBLIC

Avenida Winston Churchill, esq. Calle Andrés Julio Aybar Torre Acrópolis, Piso 11, Ens. Piantini, Santo Domingo Codigo postal 10147 Dominican Republic

PARAGUAY

Calle 22 de septiembre 221, esq. Calle Eligio Ayala Primer piso, oficinas 202 y 203 Asunción Paraguay

LATIN AMERICA

EUROPE

PORTUGAL

Rua do Rego Lameiro, nº 38 4300-454 Porto Portugal

Rua Mário Dionísio, nº 2 2799-557 Linda-a-Velha Portugal

POLAND Ul. Wadowicka 8 W 30-415 Kraków Poland

SPAIN

Campus Tribeca Carretera de Fuencarral a Alcobendas, nº 44, Edifício 4 – B, nº 21 Alcobendas – Madrid Spain

IRELAND

Railway House Station Road Loughrea Co. Galway Republic of Ireland

CZECH REPUBLIC

Kavcˇí Hory Office Park, Building A, Silver tower, 5th floor Na Hrˇebenech II 1718/10 Praha 4, 140 00 Czech Republic