The appointment of PJT BY OHLA’s bondholders is the needed bucket of cold water for the board. We have spent years being told Mañana when it came to
A capital raise of €150m would mean a significant dilution for any shareholder that doesn’t take part. It is also questionable if the Amodio family will want to
The agreement to proceed with the sale of Canalejas is a positive for OHLA. We see €200m net proceeds for OHLA, which will bring it closer to being able to
The FY23 numbers were ahead of our expectations in terms of EBITDA and cash generation. The construction order book is also healthy. Total cash was
The €300m highway contract in Illinois represents a strong end to the year for OHLA. OHLA needs to continue building its infrastructure
The headline about Canalejas is positive, but the devil will be in the details. If Santander finds a buyer willing to pay €800m (€400m for OHLA), that would be A
Q3 numbers beat our estimates. Maybe we were hasty in losing patience with the equity. EBITDA and Operating Cash flow were ahead of
Please find our amended analysis here.
We have updated our OHLA model to reflect progress in the last 12 months. With the first €206m tranche of the SSNs falling due in March 2025, we expect OHLA to undertake a
The 2025/26 bond coupons have stepped up 315bp (PIK). We do not see the bonds being called yet given the coupon that would be required. Once the CHUM/Services and
This is the final legacy arbitration case in Algeria for OHLA, and the settlement is for around half what we had modelled. Algeria will pay €38m
OHLA is seeking growth in the concessions business, where it got burned in the past. Overall order book growth was 11%, driven by the concessions business,
The Canalejas dispute will take time to resolve as it is before the Court of Arbitration in Paris. The sale of OHLA’s 50% stake will not happen until
The suit from Mark Scheinberg against OHLA will further delay any sale of the Canalejas complex. Whether the legal action is just a tactic
The timing of CEO Fernandez Gallar deciding to leave is awkward, and for now, the executive control will now fall on the Amodio brothers. The
OHLA needs to sell its 50% stake in Canalejas, and any blocking by its partner in the project is negative. Our valuation on the stake is around
23Q1 results were light vs our expectations, with construction revenue of €602m and total revenue of €638m. This weakness fed into EBITDA, which was
OHLA’s successful consent solicitation allows the working capital requirement of €40m for the Services business to be provided by new lenders. It also
Moody’s rating change acknowledged the importance of the sale of Caneljas and CHUM for OHLA. The growth opportunities shown in a healthy order book are constrained by cash trapped in JVs and the banks due to
All,
Please find our unchanged analysis here.
In our recent update to clients on OHLA, we talked about what we wanted to see in the 1H22 results. Mostly this revolved around order cancellations if the
Please find our unchanged analysis here.
OHLA is once again on the naughty step with the Spanish competition authority (CNMC), albeit in the company of its domestic competitors. Whilst a fine is never pleasant, the health of the domestic and foreign construction market is more important for OHLA's wellbeing. Inflation and raw material availability continue to hurt construction activity, but that needs to be viewed alongside raised government spending plans and emerging political will to assist the industry in addressing costs. Whilst waiting for both shoes to drop, the challenge for management is defending cash and building up the order book.
It’s been widely anticipated that OHLA would continue to see its order book development mirror the progress it has made since the completion of its restructuring program. At the quarter-end, it was 2.8% up on Q121 at €5.98bn. The return to
The Spanish government has approved a law allowing cost pass-through for public works contracts signed before 2021. The construction trade body is now asking for
We had expected this to take longer, however, yesterday Moody’s upgraded OHLA’s SSNs to B3 (positive) from Caa2. Whilst, OHLA has
Since 2019 OHLA’s banks have trapped €140m of cash currently held as collateral, the company is tentatively seeking the release of that security. Releasing that cash would
Please find our updated analysis here.
OHLA – As we emerge from the Covid pandemic governments are seeking to kick start the economy through infrastructure investment. As a result, OHLA is now
Sometimes good news brings its own challenges, but we see the reasons behind Spain’s construction labour shortage as a positive for OHLA. Increasingly
The filing of a formal agreement on collaboration between OHLA and the family business of its largest shareholder with the CNMV is a potentially
Inflationary pressure in material and labour costs is prompting action in the US and EU from contracting agencies to support builders. This will benefit
After the successful settlement of the Cemenosa litigation, OHLA is allocating some of the cash to buy back bonds and repay debt. We will