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ACS reports 20% rise in net profit as sales grow in US

FILE PHOTO: The logo of Spanish construction conglomerate ACS is displayed atop the company's building in Madrid

MADRID (Reuters) -Spanish builder ACS posted a nine-month net profit of 576 million euros ($616.2 million) on Monday, a 20% rise from last year and topping market expectations, as it expanded projects in the United States and benefited from toll-road unit Abertis.

Analysts on average expected net profit to jump 15% to 552.67 million euros from the 480 million euros reported in the same period in 2022, according to LSEG estimates. They had forecast a slight adverse impact on earnings due to currency exchange rates of both the U.S. dollar and the Australian dollar.

The company's sales rose 7.6% to 26.3 billion euros, it said.

On the back of strong results from construction activities, the company is evaluating a sale of its services unit Clece, which operates mainly in Spain, ACS Group CEO Juan Santamaria said, following a report published by local business newspaper Expansion on Monday.

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"It is true. ... We are looking at different possibilities and different options in the market," said Santamaria during a call with analysts after results were released. "We are in the early stages. ... We have not made a final decision," he added.

ACS's construction businesses generated 309 million euros in profit between January and September, up 21.5% from the same period in 2022. The concessions unit earned 173 million euros, mostly contributed by Abertis, whose net profit grew 35% compared with last year.

Services division Clece booked net profits of 22 million euros, 4.6% more than the previous year.

The Spanish builder's activities are mainly concentrated in the U.S., Australia, Spain and Canada. ACS shares closed up 1.6% at 33.78 euros on Monday in Madrid.

Last month, Abertis, in which ACS holds a 50% stake, announced it had won a tender in Puerto Rico to operate and maintain four new toll roads over the next 40 years.

ACS said traffic in motorways exceeded pre-pandemic levels in almost all countries in which Abertis operates.

The chairman of Hochtief, in which ACS holds a 73% stake, said last week the group was also winning projects related to the energy transition, new mobility options and digitalisation, boosting sales and profit.

ACS's construction activities in North America accounted for 66% of total construction revenue, with sales up 7% compared with 2022, after the company won projects to build new airport terminals, stadiums and highways, mainly in the U.S.

Group sales in the Asia-Pacific region accounted for 23% of total construction revenue.

($1 = 0.9348 euros)

(Reporting by Corina Pons in Madrid;Editing by David Latona, Matthew Lewis, Jesús Aguado and Leslie Adler)