VINCI : Report on the financial statements 2022 - English

Report on the financial statements 2022

VINCI - Report on the financial statements for the year 2022

Report of the Board of Directors - sections A and B

A. Report on the financial statements for the year

1. Consolidated financial statements

VINCI's overall performance was of a very high quality in 2022, despite a particularly turbulent geopolitical and macroeconomic backdrop. This shows the resilience of the Group's business model and the excellent adaptability of its companies.

Strong revenue and earnings growth came along with record free cash flow.

The recovery in VINCI Airports' passenger numbers accelerated throughout the year. In Portugal, Serbia and several countries in Latin America, they are now higher than they were in 2019. Combined with the impact of the cost-cutting measures adopted during the Covid-19 crisis, VINCI Airports thus posted substantial increases in profit and cash flow, both reaching high levels. In addition, the purchase of a controlling stake in Mexican airport operator OMA, which handled 23 million passengers in 2022, was completed at the end of the year.

Despite higher fuel prices, VINCI Autoroutes' traffic levels were higher than pre-pandemic levels for both light and heavy vehicles. VINCI Autoroutes also deployed new initiatives to help decarbonise road mobility.

VINCI Highways continued to build its international footprint. For example, it is currently finalizing the purchase of a majority stake in a Brazilian motorway, and it took control of a US-based company specialising in electronic toll management.

VINCI Energies continued to grow its business and increase its profitability, while further extending its network with around 30 new acquisitions including the IT services business of Kontron AG, which covers 10 countries in Central and Eastern Europe.

Another highlight of 2022, in the Energy business line, was the successful integration of Cobra IS. It won a number of major contracts linked to energy transition.

Regarding renewable energy production, the Group will enter a new phase in 2023 when its Belmonte solar farm in Brazil, with a capacity of 0.6 GW, comes into operation. New projects adding a further 1.4 GW of capacity are scheduled to enter the construction phase in the coming months, in Spain and Latin America.

VINCI Construction saw very strong business levels and improved its margin, despite higher costs and supply chain difficulties. Its highly selective approach when taking on new business and its new organization are bearing fruit.

The Group's order book remains very robust, allowing it to plan ahead with visibility and serenity.

Finally, the ongoing megatrends shaping the future of global economies and societies - faster energy transition through the production of renewable energy, decarbonisation of transport infrastructure and buildings, digital revolution - will require massive investments.

These developments are all opportunities for VINCI to achieve sustainable growth while delivering on its ambition of achieving all-round performance.

Xavier HUILLARD

VINCI Chairman and CEO

VINCI - Report on the financial statements for the year 2022

Key figures

(in € millions)	2022	2021	2022/2021 change	2019
Revenue	61,675	49,396	+24.9%	48,053
(*)
Revenue generated in France (*)	27,948	26,319	+6.2%	26,307
% of revenue (*)	45.3%	53.3%		54.7%
Revenue generated outside France (*)	33,727	23,078	+46.1%	21,746
% of revenue (*)	54.7%	46.7%		45.3%
Operating income from ordinary activities	6,824	4,723	2,101	5,734
% of revenue (*)				11.9%
11.1%	9.6%
Recurring operating income	6,481	4,464	2,018	5,704
Operating income	6,489	4,438	2,051	5,664
Net income attributable to owners of the parent	4,259	2,597	1,662	3,260
% of revenue (*)	6.9%	5.3%		6.8%
Diluted earnings per share (in €)	7.47	4.51	2.96	5.82
Dividend per share (in €)	4.00 (**)	2.90	1.10	2.04
Cash flows from operations before tax and financing costs	10,215	7,884	2,332	8,497
% of revenue (*)
16.6%	16.0%		17.7%
Operating cash flow	6,270	6,098	172	5,266
Free cash flow	5,433	5,282	151	4,201
Equity including non-controlling interests	29,409	24,771	4,638	23,191
Net financial debt (***)	(18,536)	(19,539)	1,002	(21,654)

1. Excluding concession subsidiaries' revenue derived from works carried out by non-Group companies. (**) Dividend proposed at the Shareholders' General Meeting of 13 April 2023.
   (***) Amounts adjusted following the final allocation of the Cobra IS purchase price.

VINCI's 2022 financial statements show a sharp rise in revenue and earnings compared with 2021. All business lines posted significant growth in earnings, taking them very close to or above levels achieved before the Covid-19 pandemic. This good momentum was accompanied by record free cash flow.

Consolidated revenue totalled €61.7 billion in 2022, up 25% on an actual basis relative to 2021 and up 11% like-for-like. Relative to 2019, the year before the Covid-19 crisis, revenue was up 28% . For the first time in VINCI's history, revenue generated outside France exceeded that generated in France (55% in 2022 as opposed to 47% in 2021).

Ebitda rose sharply to €10.2 billion (€7.9 billion in 2021 and €8.5 billion in 2019). It equalled 16.6% of revenue (16.0% in 2021 and 17.7% in 2019).

Operating income from ordinary activities (Ebit) was €6.8 billion, much higher than in previous years (€4.7 billion in 2021 and €5.7 billion in 2019). It equalled 11.1% of revenue compared with 9.6% in 2021 and 11.9% in 2019.

Recurring operating income amounted to €6.5 billion (€4.5 billion in 2021 and €5.7 billion in 2019). It includes a share-based payment expense (IFRS 2) and a slightly positive contribution from companies accounted for under the equity method.

Consolidated net income attributable to owners of the parent was almost €4.3 billion in 2022, representing growth of 64% compared with 2021 (€2.6 billion1) and a 31% increase relative to 2019 (€3.3 billion). Earnings per share, after taking account of dilutive instruments, amounted to €7.47 (€4.51 in 2021 and €5.82 in 2019).

1 €2.8 billion excluding the non-recurring deferred tax expense in the United Kingdom that was recognised in 2021.

VINCI - Report on the financial statements for the year 2022

Free cash flow - after operating investments by the business lines - hit a record €5.4 billion. This was driven by higher Ebitda, a stable working capital requirement following a high level of cash collection at the end of the year, and a firm grip on operating investments.

Net financial debt at 31 December 2022 was €18.5 billion. This represents a fall of €1.0 billion relative to 31 December 2021 after taking into account financial investments during the period (€2.7 billion), dividend payments (€1.9 billion) and share buy-backs net of capital increases (€0.6 billion).

At 31 December 2022, VINCI had a large amount of liquidity, around €20 billion, breaking down into €9.2 billion of managed net cash (€9.0 billion a

year earlier) and €10.5 billion of confirmed credit facilities not used by VINCI SA (€8.0 billion a year earlier).

The Group carried out several bond issues and refinancing transactions in 2022, totalling €2.8 billion. Debt repayments during the year amounted to €3.6 billion.

Order intake at VINCI Energies, Cobra IS and VINCI Construction totalled €55.7 billion in 2022, up 32% year on year (up 13% excluding Cobra IS).

At 31 December 2022, the combined order book of VINCI Energies, Cobra IS and VINCI Construction amounted to €57.3 billion, an increase of almost

9% (4% excluding Cobra IS) relative to 31 December 2021 (up 10% outside France, up 6% in France). It represents over 13 months of average business activity. International business made up 69% of the order book, as opposed to 68% at 31 December 2021.

1.1 Highlights of the period

1.1.1 Main changes in scope in 2022

Acquisition of OMA

On 7 December 2022, VINCI completed the purchase of a 29.99% stake in OMA (Grupo Aeroportuario del Centro Norte), which holds concessions for 13 airports in northern and central Mexico until 2048, from the Mexican investment firm FinTech Advisory for $ 1.17 billion. These airports together handled 23 million passengers in 2022, including one that serves the major industrial city of Monterrey and accounts for almost half of OMA's passenger numbers. The company is fully consolidated in in VINCI's financial statements.

VINCI Highways

In April 2022, VINCI Highways acquired the 70% stake it did not already own in TollPlus, a provider of technology solutions for the mobility industry and specifically for motorways. VINCI Highways has held a 30% stake in TollPlus since 2016, and has been developing its free-flow toll business in the United States, the Republic of Ireland and India. The acquisition makes VINCI Highways a leading player in electronic toll collection (ETC), a market that is growing rapidly, particularly in the United States.

In late May 2022, VINCI Highways acquired OMERS Infrastructure's 65.1% interest in Strait Crossing Development Inc. (SCDI), which holds the concession for the Confederation Bridge connecting the Canadian provinces of Prince Edward Island and New Brunswick until 2032. The transaction therefore increased VINCI Highways' stake from 19.9% to 85% .

TollPlus and SCDI are now fully consolidated in VINCI's financial statements.

VINCI Concessions subsidiary VINCI Highways and Lineas - whose main shareholder is Mota-Engil - exercised their right of first refusal to acquire Atlantia's 17.2% stake in Lusoponte, which holds concessions for two bridges over the river Tagus in Lisbon until 2030. As a result, VINCI Concessions now holds a 49.5% stake in Lusoponte, and jointly controls the company with its Portuguese partner. Lusoponte remains accounted for under the equity method in the Group's financial statements.

In November 2022, VINCI Highways increased its stake in the company holding the concession for the Rion-Antirion bridge in Greece from 57.4% to 72.3% .

VINCI Energies

VINCI Energies completed acquisitions of 31 new companies in 2022, representing combined full-year revenue of €745 million. The main acquisitions in the period were as follows:

• the majority of the IT services business of German-based group Kontron AG (previously S&T AG). This transaction, completed in late December, will enable VINCI Energies to strengthen its ICT (information and communication technology) business and develop its Axians brand in 10 countries in Central and Eastern Europe ;
• Rhön-MontageGroup in Germany, one of the country's leading providers of FTTH (fibre to the home) infrastructure services;

VINCI - Report on the financial statements for the year 2022

• TLT-Buildingand TLT-Connection in Finland, strengthening VINCI Energies' Nordic presence in energy and telecoms infrastructure.

VINCI Construction

In 2022, VINCI Construction strengthened its position in North America with the following transactions:

• completion of the acquisition of several Canadian companies specialising in roadworks and the production of asphalt mixes and aggregates in the provinces of New Brunswick and Nova Scotia from the family-owned Northern Group of Companies;
• acquisition of two US companies - Farrell Design-Build in California and Earth Tech in Florida - which specialise in ground improvement and foundation technologies.

The most significant transactions are mentioned in Note B.1 to the consolidated financial statements ("Changes in consolidation scope during the period").

1.1.2 Concessions - Other highlights

VINCI Airports

In July 2022, VINCI Airports and its Portuguese subsidiary ANA signed a forty-year concession contract to operate seven airports in the Cape Verde islands, which handled 2.8 million passengers in 2019. These airports' operations will be transferred to the new concession company once the transaction has closed, which should take place in 2023.

VINCI Concessions

Olympia Odos - which is 29.9% owned by VINCI Concessions and holds the concession for the motorway connecting Corinth and Patras - signed a concession extension with the Greek authorities in late March 2022. The extension relates to a new 75 km section of the motorway, extending it to the city of Pyrgos in the north-west Peloponnese. VINCI Concessions and its partners will be responsible for designing, funding, building and operating this new section until 2044.

VINCI Highways

In December 2022, VINCI Highways formed an agreement to acquire a 55% stake in Entrevias - which holds concessions for two toll motorway sections in Brazil, covering a total distance of 570 km in São Paulo state until 2047 - from Brazil's Patria Investments. The transaction is expected to close in the first half of 2023.

1.1.3 Contract wins at VINCI Energies, Cobra IS and VINCI Construction

Order intake at VINCI Energies, Cobra IS and VINCI Construction totalled €55.7 billion in 2022, up 32% year on year (up 13% excluding Cobra IS). At VINCI Energies, it amounted to a record €17.9 billion (up 12%). Order intake at VINCI Construction (up 13% at €29.8 billion) and Cobra IS (€8.0 billion) also rose sharply thanks to the good performance of flow business activities and the major contracts won in recent months. It was not held back by the Group's selective policy regarding new business.

Among the contracts won by the Group in 2022, the most significant were those listed below.

VINCI Energies

• Multi-servicenetwork and monitoring systems for Line 18 of the Grand Paris Express.
• Technical installations and maintenance of a new swimming pool in the Grasduinen recreation park in Belgium. The 3,000 sq. metre building will be CO2-neutral because of the 761 solar panels on its roof.
• M&E design and build packages for Phase 2 of the buildings at Mohammed VI Polytechnic University in Rabat, Morocco.
• Electrical system works for a data centre in Singapore.
• Reconstruction of the Five Forks to Windy Edge transmission line in Maryland, United States.
• EPC (engineering, procurement and construction) contract for the power supply of a ferry operator's terminal in the port of Rotterdam.
• Management of the city of Lisbon's public transport network, including smart ticketing systems and a leading-edge IoT (internet of things) architecture, which will control the network's components remotely.
• Turnkey construction of several electrical installations in Kuwait, forming part of the project to interconnect the power systems of the Gulf Cooperation Council countries and its extension to Iraq.
• Rural electrification contracts in Rwanda, financed by the World Bank and Agence Française de Développement.

Cobra IS

• Construction and maintenance contract for the electromechanical infrastructure of the Fehmarnbelt Fixed Link road and rail tunnel between Denmark and Germany.
• Design-buildcontract for Germany's first liquefied natural gas (LNG) terminal; at the mouth of the Elbe (North Sea).
• Public-privatepartnership (PPP) contract in the state of Minas Gerais in Brazil, to finance, design and build six 500 kV power transmission lines over a distance of 1,020 km, and then operate and maintain them over a thirty-year period.