EUR 200.00 For Business Accounts Only

FERROVIAL: HEATHROW TRAFFIC FALLS BY 52% IN MARCH (ANÁLISIS BANCO SABADELL)

According to the press, traffic in Heathrow (25% FER; 9% of our T.P.) would have fallen by -52.4% in March to 3.1 M passengers due to the impact from COVID-19, whereas April’s data would show a drop of around -90% in traffic next month.
Negative news although expected. Although the extent of the drop in traffic expected for April (-90%) is higher the one we are assuming in our base-case scenario (-75% drop in traffic for 3 months that would mean a -20% drop in sales in 2020), we continue to expect gradual recovery in the second half of the year and a small impact on the valuation (of less than -2% on our T.P. for FER). Separately, we welcome the fact that Heathrow Airport is a regulated asset (RAB), which, aside from the temporary impact from COVID-19, ensures its financial viability in the long-term, and also its liquidity position of £~3.3 Bn, which would allow it to meet its commitments over the next 12 months, including debt maturities totalling £ 500 M (~3% of its debt). In terms of shareholder remuneration, we believe it is highly likely that Heahtrow will cancel the dividend, which would mean an acceptable loss of €~125 M for FER (~0.9% of the market cap; ~7.7% net cash ex infra), especially considering that it has €~6 Bn of liquidity ex infrastructures.