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Spain's Sacyr sees motorways fuelling double-digit core profit growth

MADRID (Reuters) - Spanish construction firm Sacyr is confident its core earnings will grow by double digits in each of the next few years as it focuses on road projects where the terms of its concessions are linked to inflation, its finance chief said on Friday.

Sacyr posted a 47% rise in nine-month earnings before interest, taxes, depreciation and amortisation (EBITDA) to 924 million euros ($952 million), mainly benefiting from its concessions business after eight major transport projects came into operation this year.

"The group's EBITDA growth is going to continue at very strong rates over the next few years...always in double digits," CFO Carlos Mijangos told Reuters at the company's headquarters in Madrid.

Motorways recently completed in several Latin American countries and in Italy, along with three more transport projects that will be ready by 2023, should provide the world's fourth-largest transport concession group with steady cash flow for the next 25 years.

Most of Sacyr's concession contracts are tied to inflation and have a mechanism making them less dependent on traffic volumes.


The company, which also posted a 13% rise in nine-month net profit to 68 million euros, plans to launch the sale of 49% of its cleaning and recycling services business and seek a partner for its water subsidiary before the end of 2023. It expects to announce financial advisers for the divestment deals early next week.

The assets have attracted interest from infrastructure funds, industrial companies and private firms, the executive said, with bids expected by next summer.

The divestment plan would bring additional funds to speed up growth in its concession infrastructure businesses mainly in continental Europe, Britain, Australia and Canada.

It also hopes to slash net debt in the next two years, minimising its financial risks.

The CFO ruled out a total exit from the water business as it looks to take advantage of opportunities for new water supply units in Central Europe, the United States and Australia amid widening droughts.

($1 = 0.9707 euros)

(Reporting by Corina Pons, editing by Andrei Khalip, Kirsten Donovan)